Transferring measure 37 waivers.

• Author: Maukonen, Jona
• Position: Property acquisition - Oregon

1. INTRODUCTION II. DISCUSSION A. Analytical Framework. B. Interpretation of Measure 37 C. Variances, Nonconforming Uses, and Vested Rights 1. Variance 2. Nonconforming Use 3. Vested Right D. How Measure 37 Claims Could Be Treated III. CONCLUSION I. INTRODUCTION

   Measure 37 provides that a government must compensate a landowner for the enactment or enforcement of certain land-use regulations adopted after the landowner or the landowner's family acquired the property. Measure 37 also provides that in lieu of compensation, the governmental entity that enacted the land-use regulation may choose to modify, remove, or not apply the regulation. Such actions are commonly referred to as waivers. One of the important issues, currently unresolved, is whether Measure 37 waivers can be transferred from the original claimant to a subsequent purchaser of the property.

   The resolution of the transferability issue will likely impact, among other things, the overall number of Measure 37 claims filed by landowners and the number of waivers granted by government entities. A waiver is more attractive to a landowner if the landowner is able to transfer the waiver to subsequent owners. If waivers are fully transferable, it is more likely that a landowner will file a Measure 37 claim seeking a use of the property that the landowner does not intend to undertake while he or she owns the land, but that may enhance resale value.

   Similarly, nontransferable waivers pose a lesser threat to government entities' land-use schemes. If the courts determine that waivers are not transferable, a governing body is more likely to grant a waiver in lieu of compensation because it will know that the waiver will be relatively short-lived; the use will be permitted only as long as that particular person owns the property.

   This essay first discusses the analytical framework for interpreting statutes, then applies that approach to Measure 37 and concludes that Measure 37 waivers are personal rather than running with the land. Next, the essay outlines the established principles of variances, nonconforming uses, and vested rights. The essay describes how the courts could apply those established principles to Measure 37 waivers to assess whether a landowner has a vested right in the use permitted by the landowner's Measure 37 waiver.

2. DISCUSSION

   The question of transferability arises due to the ambiguities contained in subsection (8) of Measure 37. That subsection provides:

   Notwithstanding any other state statute or the availability of funds under subsection (10) of this act, in lieu of payment of just compensation under this act, the governing body responsible for enacting the land use regulation may modify, remove, or not apply the land use regulation or land use regulations to allow the owner to use the property for a use permitted at the time the owner acquired the property. (1) A court could interpret that provision in at least four different ways. The first possible interpretation, and the most restrictive, is that waivers are personal to the owner and are not transferable at all. If a landowner obtained a waiver, he or she could make use of the land in accordance with the waiver. However, when title to that property passed to a new owner, the use and any improvements that are inconsistent with the land-use regulations that had been waived would become unlawful.

   A second possible interpretation--at the other extreme--is that waivers run with the land and are fully transferable. That scenario is the least restrictive: a waiver would run indefinitely with the land. When a landowner obtained a waiver, he or she could record the waiver with the title to the property and then, regardless of whether the landowner ever made use of the waiver, when the landowner passed title to that property, the waiver would pass with the property.

   A third interpretation of subsection (8) is that each governing body responsible for issuing waivers has authority to determine ff its waivers are transferable. Measure 37 provides that governing bodies may adopt procedures for processing claims, and many have done so. A governing body could explicitly provide that the waivers it issues are not transferable to subsequent owners. (2) Alternatively, a governing body could provide that a landowner may record a Measure 37 waiver with the landowner's real property records and then transfer the right to use the land in accordance with the waiver to subsequent landowners. Currently, a lawsuit is pending in Crook County addressing that county's right to specifically allow the transfer of Measure 37 waivers. (3)

   The fourth possibility is that waivers are personal, but are transferable to subsequent owners ff the use has vested. That interpretation parallels Oregon's approach to vested rights in the area of nonconforming uses.

   1. Analytical Framework

      To interpret a statute adopted through the initiative process, Oregon courts utilize the same methodology that they use for other statutes. (4) The court's objective is to determine the intent of the voters who passed the measure (5) and in doing so the court may engage in up to three levels of review. At the first level, the court looks to the text and context of the provision. (6) The text is the best evidence of the voters' intent in adopting the provision. (7) In interpreting the text, a court employs specific maxims of construction including giving words of common usage their plain and natural meaning...