Item B: New Land Use Regulations and Measure 37

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comply with the process created by the Measure 37 implementation ordinance. Measure 37 provides that a governmental entity may adopt a claims process, but also states that compliance with such a process is not a prerequisite to filing a lawsuit in circuit court if the government does not waive the regulation. By including a variance-type process in a new land use regulation, there is a good argument that a property owner will not be able to demonstrate that a land use regulation contains a “restriction on use” or reduces the fair market value of property, which are two of the requirements for a valid Measure 37 claim. Therefore, by incorporating a variance-type process within a new land use regulation, the City may have a better chance of requiring property owners to comply with the City’s process than the City would have if the only process is the City’s Measure 37 implementation ordinance. If the council decides that new land use regulations (or at least, the Goal 5 protection ordinance) should contain a variance-type process, the council should also address the following two questions. First, what criteria should be used for granting a variance? Second, what process should be used (including who should be the initial and final decision-makers)? With respect to the first question, the purpose for providing this variance-type process would be to ensure that a new land use regulation did not create a new Measure 37 claim. Therefore, the criteria should be tied to that purpose. In essence, if a restriction in a new land use regulation would give rise to a valid Measure 37 claim, then the criteria should allow for a variance to avoid the creation of that claim. With respect to the second question, the council can model the process after an existing process, or create a new one. The process that established as part of the Measure 37 implementation ordinance was constrained to a certain extent by Measure 37 itself; it is likely that only the governing body that enacted a land use regulation can waive that regulation if the authority for that waiver is Measure 37 itself. Here, however, the authority for the “waiver” or variance will not be Measure 37, but instead, will be the council’s home-rule power. Therefore, the council has the option of modeling this variance- type process after either the process in the Measure 37 implementation ordinance, or one of the existing land use processes in the land use code, such as a type II or type III process. Both type II and type III processes require notice to the public, opportunities for public input, initial decisions, and then appeals. A type II process is one in which the Planning Director makes an initial decision, with any appeal going to a Hearings Official. A type III process is one in which a Hearings Official makes an initial decision, with any appeal going to the Planning Commission. If the council chooses to model a new variance-type process after an existing process, the council should consider a modification to allow for the possibility that the City would rather compensate for a restriction, than waive that restriction. Therefore, once a decision has been made that the property owner would qualify for a variance or waiver, before that decision becomes effective, the council should have an opportunity to decide whether the City should pay compensation. RELATED CITY POLICIES Measure 37 affects many existing City policies, from the existing policies in the Metro Plan to Chapter 9. This discussion item is to set new policy related primarily to new land use regulations that will be coming in front of the council as Planning & Development moves through the work program adopted by City Council. L:\CMO\2005 Council Agendas\M051010\S051010B.doc