A recent Oregon court ruling has bolstered a Westwide effort to force local governments to compensate landowners who lose property value to land-use regulations. But celebrations may be premature.
On Feb. 21, the Oregon Supreme Court upheld Measure 37, which was originally passed by the state’s voters in November 2004, but declared unconstitutional by a lower court last October (HCN, 11/14/05: Property-rights measure overturned). Under Measure 37, residents who think new land-use laws have damaged their property values can demand either compensation or waiver of the rules. Landowners around the state have filed about 2,500 applications under the measure, many proposing new subdivisions on farmland.
Activists are considering similar measures in about a dozen states, including Utah, Colorado, Nevada, Arizona and Wyoming, says Ross Day, legal affairs director for the pro-Measure 37 group Oregonians in Action. The Washington Farm Bureau is pushing to put a measure on the November ballot that would "require compensation when any government regulation damages the use or value of private property," and "forbid regulations that prohibit existing legal uses of private property"; it would allow some exceptions.
"What we’re telling folks is, ‘Full steam ahead,’ " says Day.But even Measure 37 supporters acknowledge that the issue remains unsettled. Oregon Attorney General Hardy Myers has opined that the Measure 37 prerogatives are linked to the owner, not to the land. In other words, a farmer who has owned land for 40 years, since before even early land-use rules were passed, could build a subdivision, but a developer probably couldn’t buy that land and then do so, since the rules would have been in place at the time of his purchase. Health, safety and other land development requirements remain in place.
Developers and their financial backers have said they’re queasy about legal risks associated with Measure 37 claims. According to Ken Sherman with the Oregon Bankers Association, the measure "will almost certainly make real estate lending more unpredictable."