Landwatch Lane Cnty. v. Lane Cnty.

291 Or.App. 41

420 P.3d 37

LANDWATCH LANE COUNTY, Respondent,

v. LANE COUNTY, Respondent,andKay King, Petitioner.

A166333

Court of Appeals of Oregon.

Argued and submitted January 9, 2018.

March 28, 2018

Michael J. Gelardi argued the cause for petitioner. With him on the brief was Hershner Hunter, LLP.

Sean T. Malone, Eugene, argued the cause and filed the brief for respondent LandWatch Lane County.

No appearance for respondent Lane County.

Before Ortega, Presiding Judge, and Garrett, Judge, and Powers, Judge.

GARRETT, J.

Petitioner, who owns a parcel of land zoned for exclusive farm use (EFU) in Lane County, received county approval under a 2013 statute to build three replacement dwellings on the property. Respondent LandWatch Lane County (LandWatch) appealed that decision to the Land Use Board of Appeals (LUBA), which reversed the county. On judicial review, petitioner argues that LUBA's order is unlawful in substance because it misconstrues the requirements of Oregon Laws 2013, chapter 462, section 2. We agree, and we therefore reverse and remand LUBA's order.

We take the relevant facts from LUBA's opinion. In 2016, petitioner applied for permits to replace three dwellings previously located on her property that had been demolished in 1997. A county planning director approved the applications. In response to LandWatch's challenge, Lane County conducted further proceedings, which resulted in the applications being approved by a county hearings official and ultimately by the county's board of commissioners. LandWatch appealed that decision to LUBA.

At issue before LUBA was the meaning of House Bill (HB) 2746 (2013) (the 2013 Act), through which the legislature amended the requirements for replacement dwellings in EFU-zoned land. Section 2 of the 2013 Act provides, in part:

"(1) A lawfully established dwelling may be altered, restored or replaced under ORS 215.213(1)(q) or 215.283 (1)(p) in the manner provided by either subsection (2) or (3) of this section.

"(2) The dwelling may be altered, restored or replaced if, when an application for a permit is submitted, the permitting authority:

"* * * * *"(b) Finds that the dwelling was assessed as a dwelling for purposes of ad valorem taxation for the lesser of:

"(A) The previous five property tax years unless the value of the dwelling was eliminated as a result of the destruction, or demolition in the case of restoration, of the dwelling; or"(B) From the time when the dwelling was erected upon or affixed to the land and became subject to assessment as described in ORS 307.010 unless the value of the dwelling was eliminated as a result of the destruction, or demolition in the case of restoration, of the dwelling."

Or. Laws 2013, ch. 462, § 2. The Land Conservation and Development Commission (LCDC) later amended OAR 660-033-0130 to implement the 2013 Act. OAR 660-033-0130 provides, in relevant part:

"(8)(a) A lawfully established dwelling may be altered, restored or replaced under ORS 215.213(1)(q) or 215.283 (1)(p) if, when an application for a permit is submitted, the permitting authority finds to its satisfaction, based on substantial evidence that:

"* * * * *

"(B) The dwelling was assessed as a dwelling for purposes of ad valorem taxation for the previous five property tax years, or, if the dwelling has existed for less than five years, from that time.

"(C) Notwithstanding paragraph (B), if the value of the dwelling was eliminated as a result of either of the following circumstances, the dwelling was assessed as a dwelling until such time as the value of the dwelling was eliminated:

"(i) The destruction (i.e. , by fire or natural hazard), or demolition in the case of restoration, of the dwelling[.]"

Before LUBA, LandWatch argued that the county hearings official had erroneously concluded that petitioner's applications satisfy the requirements of the 2013 Act and OAR 660-033-0130. The hearings official had determined that the applications satisfied the applicable requirements because the subject dwellings had been assessed for tax purposes from the time they were built until they were demolished and removed from the tax rolls in 1997. According to LandWatch, the 2013 Act is more restrictive; specifically, LandWatch contended that the 2013 Act requires a former dwelling to have been assessed as a dwelling within the five years immediately preceding the permit application.

LUBA agreed with LandWatch, concluding that subparagraphs 2(2)(b)(A) and (B) of the 2013 Act "work together to specify the default, and longest, assessment look-back possible—five years." LUBA further concluded that OAR 660-033-0130"eliminates the duplication in the statute and achieves the same limitation [that] the statute achieves" but that the rule "does not eliminate the statutory requirement to impose a look-back period of five years." Based on its construction of the 2013 Act's requirements, LUBA concluded that, because petitioner's dwellings had not been assessed as dwellings in the five years preceding her application, the county could not issue permits for their replacement under ORS 215.213(1)(q) and section 2(2)(b) of the 2013 Act. Accordingly, LUBA reversed the county's approval decision.

Petitioner seeks review of LUBA's final order, arguing that LUBA incorrectly construed the 2013 Act and OAR 660-033-0130. Petitioner argues that, contrary to LUBA's construction, the five-year time limit in the 2013 Act does not apply to dwellings that were destroyed or demolished. Petitioner further argues that OAR 660-033-0130 reflects that construction of the statute. To that end, petitioner argues that LUBA misread the text of the rule, which provides that, "[n]otwithstanding" the five-year taxation requirement stated in OAR 660-033-0130(8)(a)(B), "if the value of the dwelling was eliminated as a result of *** (i) [t]he destruction (i.e. , by fire or natural hazard), or demolition in the case of restoration, of the dwelling," then the dwelling need only have been assessed as a dwelling "until such time as the value of the dwelling was eliminated." OAR 660-033-0130(8)(a)(C).

We review LUBA's order to determine whether it is "unlawful in substance," ORS 197.850(9)(a), and we do not substitute LUBA's judgment with our own with respect to any factual issue, ORS 197.850(8). We review LUBA's construction of statutes for legal error. Bowerman v. Lane County , 287 Or. App. 383, 392, 403 P.3d 512 (2017). Because LUBA's order turned on its conclusion that (1) issuance of the permits was inconsistent with the statute's five-year "look-back" requirement and that (2) LCDC's rule was not inconsistent with that requirement, our review turns in large part on whether LUBA correctly construed the 2013 Act.

As a preliminary matter, petitioner asserts that LCDC's interpretation of a statute as embodied in OAR 660-033-0130 is "presumptively valid" based on the agency's land-use expertise, arguing that we must defer to LCDC's construction under Springfield Education Association v. Springfield School District , 290 Or. 217, 621 P.2d 547 (1980) ( Springfield ). In Springfield , the Supreme Court set forth the respective roles of courts and administrative agencies in construing statutes, delineating three categories of statutory terms—exact, inexact, and delegative. Id . at 223-30, 621 P.2d 547. "Both exact terms and inexact terms are complete expressions of legislative policy," Coffey v. Board of Geologist Examiners , 348 Or. 494, 508, 235 P.3d 678 (2010), and an agency's construction of either exact or inexact terms, i.e. , nondelegative terms, "is not entitled to deference on review," Blachana, LLC v. Bureau of Labor and Industries , 354 Or. 676, 687, 318 P.3d 735 (2014). "Delegative terms," by contrast, are those indicating that the legislature intended to delegate policy-making to the agency charged with implementing the statute, "such as the term ‘good cause,’ an open-ended phrase that necessitates further administrative agency policymaking." DCBS v. Muliro , 359 Or. 736, 745, 380 P.3d 270 (2016). If a statutory term is delegative, we will defer to an implementing agency's interpretation "as long as it is within the range of discretion allowed by the more general policy of the statute." State v. Richards , 361 Or. 840, 849, 401 P.3d 767 (2017) (internal quotation marks omitted).

To the extent that petitioner contends that the relevant statutory text here is delegative, we disagree. Unlike delegative terms, which "call[ ] for completing a value judgment that the legislature itself has only indicated," Springfield , 290 Or. at 228, 621 P.2d 547 (internal quotation marks omitted), the disputed replacement-dwelling requirements express a complete legislative policy, though not with such precision as to eliminate the need for statutory construction. The 2013 Act sets forth specific requirements for the issuance of a replacement-dwelling permit; the applicable requirements depend on circumstances such as whether the former dwelling has been taxed as a dwelling for the previous five years, whether the former dwelling was constructed less than five years before the permit application, whether the dwelling was destroyed or demolished, and whether the dwelling was improperly removed from the tax rolls by a party other than the applicant. Although the interplay of those requirements requires some interpretation, there is no indication that the legislature intended to delegate to LCDC the authority to add to, subtract from, or alter the content of those requirements. Therefore, because the terms at issue are nondelegative, we reject petitioner's contention that we must defer to LCDC's construction of the 2013 Act, as expressed in OAR 660-033-0130. See Blachana, LLC , 354 Or. at 687, 318 P.3d 735 (an agency's interpretation of a nondelegative term "is not entitled to deference on review"). In that light, we turn to the merits of petitioner's arguments on review.

In construing statutes, we use the framework set forth in PGE v. Bureau of Labor and...