For Bob and Cathy Beck, the small community of Orenco, Oregon, seemed the perfect place to retire. Nestled in the heart of the scenic Tualitan and Willamette valleys, Orenco had roughly the same population--250 residents--that it had 50 years ago. Despite the rapid growth of Portland, located just 20 minutes away, Orenco is still surrounded by wide-open pastures, rickety barbed wire fences, and a nine-hole golf course built in 1953. "Orenco seemed like the kind of place where we wouldn't be bothered," says Cathy Beck, who poured her savings into a new two-story home. "It seemed so permanent."
This permanence collapsed in the fall of 1995, when urban planners discovered Orenco's potential for "transit-oriented development" (TOD). The community happens to border a 28-mile light-rail line that connects downtown Portland with its western suburbs. Portland's regional planning board, Metro, announced that Orenco--a quiet section of the booming suburb of Hillsboro--would be an ideal site for a light-rail station. But Orenco's wide-open streets and spacious homes were too amenable to car travel. So, to encourage local residents to jump on the rails, the Hillsboro city council passed an ordinance requiring "high density," multi-family TOD within Orenco's boundaries.
The light-rail regulations are transforming a sleepy, suburban community into a dense, urban landscape. On a piece of undeveloped land directly behind the Becks's new home, workers have begun construction of 20 pink and white condominiums. Three more condominium and apartment developments, housing an estimated 120 new residents, will blanket Orenco's remaining undeveloped land. Urban planners hope developers will finish the construction by 1998, to coincide with the grand opening of Orenco's new light-rail station.
While the Becks have no complaint with the light-rail system per se, they find the accompanying regulations needlessly stringent. In their spacious backyard, Cathy Beck had planned to build a small, one-story bungalow for her mother, who requires constant medical care. The local planning commission nixed the request. Under new minimum- density zoning regulations, the Becks cannot build a one-room apartment unless they construct an additional four units on the same property--something they aren't willing to do.
To avoid this hassle, the Becks considered selling their home and moving outside Portland's light-rail development area. But they say the market value of their property has fallen by 20 percent since the new development began earlier this year. Potential buyers are worried that Orenco has become too congested for a suburban home. "We might as well be living next to an office building in downtown Portland," says Cathy Beck.
The Becks are among many Oregon property owners frustrated with land-use regulations connected with Metropolitan Area Express (MAX)--the $2.6 billion light-rail project connecting downtown Portland with its swelling suburbs. Ever since Portland built its first MAX line a decade ago, light rail has been a regulatory quagmire.
The new regulations require that all housing developments within two square miles of a light-rail station contain at least 12 units per acre--roughly double what was allowed under previous zoning laws. Moreover, most local governments in the Portland area have passed strict parking limits to discourage auto use near light-rail stations. In case these regulations are not enough, the state legislature recently passed Senate Bill 1156. This legislation gives Metro the power to overturn any local zoning law or ordinance that interferes with light-rail development.
Developers who had planned to build commercial buildings or traditional suburban homes are now required to build apartment buildings, condominiums, or row houses. Homeowners who thought they were living in sleepy, suburban neighborhoods are finding themselves immersed in big-city neighborhoods.
"It doesn't matter how many people yell and scream," says Jon Chandler, director of governmental affairs for the Oregon Building Industry Association. "If the government passes a law requiring apartment buildings, the government will get apartment buildings."
Greg Specht, a Portland-area developer, knows that all too well. In 1988, he bought an option on 75 acres of prime land in Beaverton, a thriving suburb west of Portland. Specht planned to build on the land, which borders shoemaker Nike's corporate headquarters. But those hopes were dashed when the government announced plans for a new light-rail station next to his property. The Beaverton planning commission imposed minimum-density requirements and parking limitations on land surrounding the station. Then Metro required Specht to work with county and local governments to create a "master plan" for future development on his property.
Although Specht was willing to comply with most of the new regulations, he found a limit of fewer than two parking spaces per housing unit--regardless of the size-- unreasonable. Most people, he insists, expect to have parking spaces for their cars, even-- perhaps especially--with a nearby light-rail station. After several meetings, however, the Beaverton planning commission refused to budge. So Specht sold his option to Nike, which declines to divulge any plans for the property. "Had the government been just a little more lenient, I might still own that property," says Specht.
Indeed, the political process offers property owners scant protection against these regulatory intrusions. Most Portland area residents do not own land near the new light-rail stations; they have little reason to sympathize with those who must overcome obstacles to development. Some are grateful the new regulations are confined to the light-rail corridor instead of their own neighborhoods. As a result, regular public meetings on light rail simply enable a majority--which reaps the benefits but not the costs of light rail--to demand more regulations on those who have the misfortune of owning land near a public infrastructure project.
This is the political dynamic underscored in Richard Epstein's Takings: Private Property and the Power of Eminent Domain (1985). Public zoning laws, notes Epstein, a University of Chicago law professor, will almost always favor a broad majority interest over minority rights. "Land-use regulation places the land back into a modified common pool," writes Epstein, "where many persons can limit the future use of the land, even though only one person, the owner, can actually use it. Ill-defined rights replace well-defined ones." Property rights groups such as Oregonians in Action are speaking out against the zoning and planning laws on the grounds that they are regulatory takings restricted by the U.S. Constitution. Unless the government can make a compelling case why these regulations will improve neighborhoods, argues Bill Moshovsky, vice president of Oregonians in Action, property owners should receive "just compensation" from those governments imposing the new regulations. "We can't just let the government transform entire neighborhoods and communities without some accountability," he says.
So far, Oregonians in Action has filed no legal challenges in the light-rail case, choosing instead to wage a publicity campaign against the onerous regulations. The group has had some notable successes. It prevailed in Dolan v. the City of Tigard (1994), a groundbreaking U.S. Supreme Court case that should offer some inspiration to property owners affected by light-rail regulations. In Dolan--a decision heavily influenced by Epstein's analysis--the Court ruled that a government must prove a "rough proportionality" between its regulations and the "legitimate state interests" it is trying to advance. The Court ruled that a business owner could not be forced to build a public bike path and flood easement in exchange for a government permit to expand a hardware store. In this case, the "state interest" was to control traffic and floods. But the means--requiring one landowner to build public projects on her property--was ruled "excessive."
Oregonians in Action believes that Portland-area governments should be held accountable to this "rough proportionality" requirement. Zoning commissions, says Moshovsky, must explain how sweeping new regulations requiring dense development along a 28-mile light-rail corridor will accomplish a "legitimate state interest." If this correlation cannot be made, then private landowners should be compensated for any costs incurred from the new regulations.