COSTCO WHOLESALE CORPORATION v. KANE, Ordinance No. 4338 (Or. LUBA 8/30/2007)

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COSTCO WHOLESALE CORPORATION, Petitioner, and HENRY KANE, Intervenor-Petitioner, v. CITY OF BEAVERTON, Respondent.

WELLS REAL ESTATE FUNDS, INC., Petitioner, v. CITY OF BEAVERTON, Respondent.

BOLD, LLC, Petitioner, and HENRY KANE, Intervenor-Petitioner, v. CITY OF BEAVERTON, Respondent.

C.E. JOHN COMPANY, INC., Petitioner, and HENRY KANE, Intervenor-Petitioner, v. CITY OF BEAVERTON, Respondent.

Ordinance No. 4338.

Ordinance No. 4339.

Ordinance No. 4340.

Oregon Land Use Board of Appeals.

August 30, 2007.

On remand from Court of Appeals.Joseph S. Voboril, Portland, represented petitioner Costco Wholesale Corporation. Dana L. Krawczuk, Portland, represented petitioners Wells Real Estate Funds, Inc. and Bold, LLC. Roger A. Alfred, Portland, represented petitioner C.E. John Company, Inc. Henry Kane, Beaverton, represented himself. Alan A. Rappleyea, City Attorney, Beaverton, represented respondent.RYAN, Board Member; HOLSTUN, Board Chair; BASSHAM, Board Member, participated in the decision. REMANDED. AFFIRMED. You are entitled to judicial review of this Order. Judicial review is governed by the provisions of ORS 197.850.FINAL OPINION AND ORDER Opinion by Ryan.

NATURE OF THE DECISION In these consolidated appeals, petitioner Costco Wholesale Corporation (Costco) appealed Ordinance No. 4338 (LUBA No. 2005-044). Petitioner Wells Real Estate Funds, Inc. (Wells) also appealed that ordinance (LUBA No. 2005-046). Petitioner Bold, LLC (Bold) appealed Ordinance No. 4339 (LUBA No. 2005-050). Petitioner C.E. John Company, Inc. (C.E. John) appealed Ordinance No. 4340 (LUBA No. 2005-053). Each of those ordinances annexes several properties under ORS 222.750.¹ INTRODUCTION LUBA consolidated the above described appeals pursuant to OAR 661-010-0055 and issued a single decision to resolve all four appeals. Costco Wholesale Corporation v. City of Beaverton, 50 Or LUBA 476 (2005) (Costco I). In our opinion in Costco I, LUBA affirmed all three of the ordinances referenced above. We rejected petitioners' arguments that the use of the phrase "surrounded by" in ORS 222.750 requires that the property to be annexed must be adjacent to the city boundaries on all sides. Id at 484-85. Wells appealed our decision affirming the city's decision annexing the properties described in Ordinance No. 4338, and Bold appealed our decision affirming the city's decision annexing the properties described in Ordinance No. 4339. The Court of Appeals affirmed this Board's decision as to Bold, but reversed our decision as to Wells. Costco Wholesale Corp. v. City of Beaverton, 206 Or App 380, 136 P3d 1219 (2006) (Costco II).

After considering the text of ORS 222.750 in context, and the legislative history, the court held: "We thus conclude that the legislature, in enacting the current version of ORS 222.750, intended `surrounded by' to mean that the territory to be annexed must be completely enclosed by and contiguous with the corporate boundaries of the annexing city * * *." Id. at 398. The city appealed the Court of Appeals' decision to the Supreme Court.² T h e Supreme Court affirmed the Court of Appeals' decision, holding: "We conclude from our examination of the text of ORS 222.750, the statutory scheme in which it is embedded, and relatedly, its historical roots, that the legislature has granted cities the right to annex property beyond its borders in only particular, limited circumstances. Because ORS 222.750 does not explicitly authorize annexation of part of an island that is not itself surrounded, completely and contiguously, by city boundaries, we hold that the statute does not authorize annexation of the Wells property." Costco Wholesale Corp. v. City of Beaverton, 343 Or 18, 27, __ P3d __ (2007) (Costco III). The Supreme Court affirmed the Court of Appeals' decision and remanded the case back to LUBA for further proceedings. DECISIONS ON REMAND As we note above, our decision in Costco I affirmed three ordinances. The Court of Appeals reversed our decision in Costco I as to petitioner Wells and affirmed our decision in Costco I as to petitioner Bold. The ordinance that...