Losing Ground in Oregon

Despite widespread dissatisfaction with it, the nation's toughest land-use control law keeps surviving challenges.

"Going to Oregon is almost like traveling to English-speaking Canada," observes the 1982 Almanac of American Politics: "the society is clearly similar, but everything is arranged in a slightly different way and the assumptions that guide public policy are noticeably different." In no area have those assumptions been more different than in the state's policies concerning private property. Beginning with the Oregon Beach Bill of 1967, under which the state declared its ownership of the entire shoreline from extreme low tide up to the 16-foot elevation, a series of legislative acts has aimed at preserving the countryside but has evidenced little regard for those who might own a part of it.

When Oregon's census figures grew by 18 percent during the 1960s and 25 percent during the '70s, many long-time residents displayed a strong xenophobic reaction. Automobiles sprouted bumper stickers reading "Don't Californicate Oregon." The James G. Blaine Society was chartered, dedicated to "various graceful, poetical, vague, and sinister means of discouraging overpopulation of Oregon." And, in a nation that has long equated population growth with prosperity and success, then-Governor Tom McCall publicly urged people to come visit but not stay.

These high feelings reached a crescendo in 1973, when the legislature passed Senate Bill 100, establishing a statewide system of land-use planning. An innocuously named Land Conservation and Development Commission (LCDC)—seven appointed members and their staff—was given considerable power over all land, air, and water resources. The commission was charged with developing what were to be known as "statewide planning goals" and with identifying "areas of critical state concern and activities of statewide significance." These would become the standards for approving or rejecting comprehensive plans that each city and county was required to develop and submit to the LCDC.

The first 14 "goals" were adopted in December 1974, and 5 more were added over the next two years. So vague and general were they that few except the LCDC could fully understand what was required to meet them. Goal 5 for example, is to "conserve open space and protect natural and scenic resources." It requires that "programs be provided that will: (1) insure open space, (2) protect scenic and historic areas and natural resources for future generations, and (3) promote healthy and visually attractive environments in harmony with the natural landscape character."

The guiding idea of these goals was to make sure that most future growth was within established urban areas, leaving the more pastoral areas in their pristine state. This aim is clearly expressed in Goal 14, which is "to provide for an orderly and efficient transition from rural to urban land use." To implement this goal, the commission stipulated that "urban growth boundaries shall be established to identify and separate urbanizable land from rural land."

As one might guess, the value of land outside these "urban growth boundaries" dropped dramatically once its use was so limited. Coos County Commissioner Ed Stevenson estimates that the 1973 law has translated into a $50-million loss in property value in mostly rural Coos County.

It is interesting to note that in passing Senate Bill 100, the legislature recognized that there could be an adverse impact on some private property owners. One provision of the bill established a committee to study and make recommendations "on the implementation of a program for compensation by the public to owners of lands for the value of any loss of use resulting directly from the imposition of any zoning, subdivision or other ordinance regulating or restricting the use of such lands." Oregonians felt a sense of foreboding when the committee reported back in 1976 that an adequate compensatory program would exhaust the resources of the state treasury. But instead of pausing to ask, Why devalue so much property if we can't pay for it? the legislature blissfully ignored the issue. Since compensation was impossible, it was no longer of concern.

Under the law, comprehensive plans by each city and county were to be completed and approved by the end of 1975, but as of September 1982, only 151 of a total 281 plans had gained the endorsement of the LCDC. Those involved in the system continually found themselves having to revise procedures in response to new law created by court decisions or bureaucratic whim, then revising the revised procedures in response to the next directive. Between 1973 and 1981, $29.4 million of state and federal taxpayers' money was spent in administering the program. Counties expended an additional $10–$15 million and landowners millions more in trying to work within the law.

The complexity of the law gave birth to an army of "planning consultants" whose job it was to generate the mountain of paperwork required for even the most simple project, since every proposal for change had to address every statewide planning goal. A 1973 Oregon Supreme Court decision made things even more difficult by upholding a requirement that applicants for a zone change or subdivision prove not only that the development was legal but that it was needed and that other suitable property was not available!

Land-use economists were called to testify in public hearings that there was demand for a given project and that the demand constituted a public need. Realtors were asked to testify that they had unsuccessfully searched the marketplace for other available property or, if other property was available, why it was unsuitable. Befuddled property owners wondered what earthly difference it made whether there was other property available when they were interested in the property they owned. In the event that approval was given at the local level, the system almost encouraged appeals to higher bodies. Opponents of change didn't even need to show that they were specifically being affected, since legal standing to file an appeal was granted to any individual or group interested enough merely to testify at the local hearing.

The path of one case could take years to complete, and throughout, the burden of proof was always on the property owner. A former vice-chairman of the LCDC was forced to conclude, writing in the Willamette Law Review, that "only the rich, the extremely tenacious or those paid annual salaries to advocate can afford to persevere in such a system."

By 1976, rancor against the program was such that enough signatures were gathered to put the entire matter on the ballot for voters to decide. The LCDC survived by a 57-to-43 percent margin. Two years later, in 1978, the issue was once more on the ballot and again was supported, this time by an even wider margin of 60 to 40 percent. After the 1978 defeat, LCDC opponents were becoming resigned to control of private property resting in the hands of a capricious state bureaucracy. But in 1979 a new development markedly changed Oregon's way of life: national interest rates rose to levels that in years past had been prohibited by usury laws.

To fully appreciate the implications of such a shift, one must understand the extent to which the state is dependent on the timber industry. It has been accurately said that when the housing market cools, Oregon freezes. When national housing starts cooled from 2 million units in 1978 to 1.1 million in 1981, three-quarters of Oregon's approximately 28,000 lumber mill workers were frozen out of work or were working less than a full shift. By July 1982, of the 197 lumber mills usually in full production, 73 had closed and 54 were running at less-than-normal capacity. Statewide unemployment rose from 6 percent in 1978 to 12.5 percent in 1982.

The ripple effect was startling. State income tax revenues declined so rapidly that the legislature had to be called into special session three times in 1981 to deal with projected budget deficits. Stores desperate to move merchandise ran continuous clearance sales, even during the usually busy Christmas season. Real estate foreclosures in one county hit 250 per month. And by 1981 the no growth advocates saw their goal met: figures from Portland State University's Center for Population Growth showed that, not only had Oregon's population growth stopped, but more people were now leaving the state than were arriving.

In the midst of such turbulence, people were beginning to ask why, in this era of high technology, Oregon was still at the mercy of national demand for its forest products. Conferences were held, consultants retained, and studies made, all to determine how best to deal with the economic problems.

With near unanimity, the experts announced that Oregon suffered from an antibusiness image. Frank Cappiello, a panelist on the PBS television series Wall Street Week, summed up the situation quite well when he told an economic development conference, "The perception we have of Oregon in the East is that it really doesn't want industry. Oregon is perceived as wanting a nice, clean, self-contained environment. Investors look around…and go to Arizona, where people are perceived to be more concerned about jobs. One day people who worry about the clear environment will be able to see the Cascade Mountains, but they won't be able to eat."

To confirm this view, an annual study of business climates in the 48 contiguous states by the accounting firm of Alexander Grant Co. ranked Oregon 36th in 1982. As an example of the indifference shown to industry, Allen E. Wood, director of real estate and plant siting for the $10-billion-a-year Westinghouse Electric Corp., told a reporter for the Portland Oregonian how he contacted the Oregon Department of Economic Development for information on industrial land in the state. The material he finally received, after sending in $15 for handling costs, consisted of brochures detailing campground opportunities. But the coup de grace was a scorecard published by National Industrialist magazine showing how many new industries each state had attracted during the first half of 1981: North Carolina, 179; Texas, 303; Florida, 191; and Oregon, only 4.

Hurting from such rejection, public officials and civic groups suddenly scrambled to find ways to change the state's image. Early attempts bordered on the bizarre. Gov. Victor Atiyeh at one point proposed dynamiting one of the signs along |he Oregon-California border welcoming visitors to the state. Because the sign read "Hope You Enjoy Your Visit," Atiyeh felt there was the inference that Oregon would take tourist dollars but still didn't want anyone to move in for good. Plans for the publicity stunt were dropped when someone pointed out that the massive carved wooden sign was worth over $15,000.

More rational thinkers, however, were increasingly pointing to the state's land-use laws and the LCDC as the main culprit in Oregon's bad business reputation. Since 1978, when the issue was last on the ballot, the planning bureaucracy had made many enemies. Becoming impatient with local governments to conform to its edicts, the commission began exercising its broad enforcement powers. Curry County suffered for two years under a total building moratorium because it had not taken the demanded steps to protect agricultural lands. Ignored was the fact that 94 percent of the county consisted of federal or corporate timber lands, and the only cash crops were cranberries and Easter lilies. At the other end of the spectrum, the small town of Happy Valley was ordered to speed up development and achieve greater density, even though the 1,440 residents indicated a strong desire to stay small.

Counties and cities were finding that after going through the laborious process to develop a comprehensive plan, nearly 86 percent were rejected on first submission as unsatisfactory. A comment by one former LCDC member to a reporter typified the state of affairs: "We're still struggling with how much freedom should be allowed," she said.

Though most local officials bowed to the commission's intimidation and arrogance, their constituents were not so accommodating. One county commissioner was recalled from office for being too sympathetic to the LCDC; voters in three counties threw out commission-approved plans; and bumpers around the state began to carry a new sticker saying, "Poland has martial law, Oregon has LCDC." The time seemed right for a petition drive to place the issue on the ballot again.

Other avenues for dealing with the planning bureaucracy, such as legislative modifications or court cases, had already been pursued, but without success. In every session of the legislature, strong attempts were made to gain relief, but the environmental lobby was always too powerful. A lawsuit challenging the constitutionality of the program was brought in 1977 by 21 local jurisdictions, only to bounce around the court system for five years. (In July 1982, all appeals were exhausted.)

So on November 14,1981, groups from around the state came together in a Portland suburb to evaluate the feasibility of another initiative campaign. In what may have been an omen of things to come, hurricane winds buffeted the area the day before, causing those in attendance to make their plans without the comfort of heat or electricity. Despite such inconvenience, a coalition was formed under the name Oregon Citizens for Fair Land Planning, and they decided to seek for a third time to overthrow the oppressive planning laws. By the end of June, petitions had been printed and distributed and 65,700 signatures gathered (only 56,000 were required), forcing the secretary of state to certify Ballot Measure 6 for the November general election. Relatively moderate in nature, Measure 6 called for elimination of the state's authority in land use planning but still required local elected officials to maintain master land plans.

It did not take long for the opponents of Measure 6 to make themselves known. While small in number, the list included many of Oregon's most prominent citizens. Both gubernatorial candidates, for example, seemed to disagree on everything except the inadvisability of 6.

Cochairman of Citizens to Defend Your Land—the group formed to defeat the measure—was John Gray. Gray was one of the state's most successful land developers and the chairman of the board of Omark Industries, the world's largest manufacturer of cutting chain for chain saws. He had built two of Oregon's largest luxury resorts in the days before the LCDC would prevent anything on a similar scale from getting off the ground.

Another member of the opposition was Bill Bowerman, cofounder of the Nike shoe company. In his 24 years as head track coach at the University of Oregon, Bowerman had trained 28 Olympians, 12 American record holders, 24 NCAA champions, and in the process, had become something of a guru to thousands of long-distance runners. Another Nike executive publicly declaring his abhorrence of the measure was Neil Goldschmidt, former mayor of Portland and secretary of the Transportation Department under Jimmy Carter.

No one had a greater impact on the outcome of Measure 6, though, than the man most instrumental in the passage of Senate Bill 100 in 1973—the late ex-Governor Tom McCall. With an unorthodox style and strong environmentalism, McCall had become something of an Oregon legend during his two terms in office. He was unsuccessful in a 1978 comeback bid for governor, but he still wielded considerable influence as an elder statesman and as a regular political commentator for a large Portland television station.

In 1973 McCall was found to have cancer, and despite surgery, the cancer appeared again in 1981, spreading throughout his body. Always one for theatrics, on October 7, 1982, McCall gave one of his best performances. Speaking for a gathering sponsored by two environmental groups, the ex-governor acknowledged that he had only a short time to live and pleaded with Oregonians not to repudiate the land-use planning system and "Oregon mystique" that were hallmarks of his administration. Asking the audience to bear with him for some personal remarks, McCall said: "I'm not embarrassed, I haven't got much time left. This is my last to talk to you about this. You all know I have terminal cancer—and I have a lot of it.

"But what many of you might not know," he continued, "is that stress induces its spread and induces its activity. Stress may even bring it on. Yet stress is the fuel of the activist. This activist loves Oregon more than he loves life. I know I can't have both very long, but the tradeoff's all right with me." McCall concluded by declaring, "But if the legacy we helped give Oregon and which made it twinkle afar—if it goes, then I guess I wouldn't want to live in Oregon anyhow."

Oregon's news media gobbled up the maudlin exhibition. The Salem Statesman-Journal wrote in an editorial, "Oregon owes Tom McCall something better than the repudiation of his dream for the state." The largest daily, the Portland Oregonian, followed suit when it melodramatically said, "Respect for the man, the former governor, left no eye without a shine among the many business and professional persons who heard him, but their understanding of his message went much deeper." Even network television devoted time to the story. CBS News ran a lengthy segment dealing with McCall on the October 22 evening broadcast, and NBC's Today show carried a similar report a week later.

Only one newspaper in the state, the Grants Pass Courier, had the temerity to note that McCall's "pending death cannot offset the fact that many of the state's 2 million individuals feel oppressed, stifled and indeed hurt by the iron hand of the LCDC and even the plea of this dying man cannot alter the fact." In an attempt to gain similar sympathy for their own position, Oregon Citizens for Fair Land Planning organized a press conference in which a widow told how her husband had also been a victim of cancer, leaving her with $100,000 in medical bills. LCDC regulations prevented her from selling part of her 21 acres to raise needed cash or to give a parcel to each of her two children—because the land was classified as agricultural, the property had to remain in farm use and couldn't be divided into pieces smaller than 20 acres. This story was almost completely ignored by the media.

The emotions generated by McCall's remarks were heightened by strong editorial support from the Oregonian. No less than 12 editorials and columns warned that a host of evils would result if the state's authority in land use were ended. Citizens could expect "condo-mania on the coast," where "beaches could be behind fences and walls…screened by buildings, never to be ours again." Measure 6 would subject "Oregon's rich farm and forest lands and coastal areas to the same type of private, greedy or unthinking trampling of natural areas that existed before LCDC." Oregon's "model state land use planning program" would be replaced with "chaos, sprawl, and disorderly growth." Residents would find "local politicians acceding to special interests rather than those of most residents and future citizens."

Television ads against the reform measure showed developers' bulldozers plowing up beaches and wheat fields while a narrator cautioned that this would be the result if Measure 6 passed. A radio spot featured a hysterical-sounding farmer saying that the only thing standing between his field and a lay of asphalt was LCDC. His plea: "Stop them! Please stop the land grabbers!" (The protection of farmland against urban development was one of the major objectives of the LCDC program. The commission proceeded to adopt a definition of agricultural land that included not only land currently in production but virtually any parcel that could possibly ever grow anything. Eventually in Oregon, 17 million acres will be in Exclusive Farm Use Zoning—more acreage under such tight restrictions than in the 49 other states combined, according to the 1981 National Agricultural Land Study.)

In contrast, the advertising in support of Measure 6 tried to rely on facts and reason. The dean of the University of Oregon School of Business talked about a Stanford Research Institute study showing that it took 3–5 times longer to prepare a new plant site in Portland, Oregon, than across the river in Vancouver, Washington, and 10–15 times longer than in Austin, Texas. Another ad featured the master of the Oregon State Grange telling why his agricultural organization was supporting Measure 6: farmland had been growing at a faster rate before the LCDC was created than afterward; regulations were denying farmers the flexibility to sell acreage when times were hard; and young people were prevented from breaking into farming because they could not afford the large initial investment required to purchase even the smallest allowable parcel.

Most major business organizations and chambers of commerce in the state endorsed the measure, as did the Association of Oregon Loggers, the Oregon Association of Realtors, the Association of Oregon Counties, the Oregon Cattlemen's Association, the Oregon Forest Industry Council, and many others. But it wasn't enough. The constant barrage of misinformation and scare stories had a devastating effect. Polls showing the percentage of those who would cast a yes vote went from 57 percent on September 24, to 52 percent on October 15, and finally down to 48 percent on October 30, dead even with those who would vote no.

The downward trend continued three days later when Ballot Measure 6 was defeated 55-to-45 percent. Although a majority in 21 of Oregon's 36 counties voted in favor of the proposal, the larger numbers of the Portland metropolitan area, where 40 percent of the state's population lives, were too much to overcome. As might be expected, the heaviest voting against the LCDC came from the areas the agency is most interested in preserving. Of the seven counties where 50 percent or more of the land is in farms, five showed voters casting their ballots decisively for abolishing the laws limiting the use of their property.

It is difficult to find a bright spot in the face of such a defeat. But perhaps the Oregon situation will serve to remind others that the right to own and enjoy private property, one of the most basic rights guaranteed by the Constitution, is probably also the most vulnerable to government encroachment. Because of the double standard in this country regarding political rights and economic rights, governments can quite easily impose an array of restrictions on a person's use of his property but not on something like speech, of which the late Supreme Court Justice Hugo Black once said, "Only the gravest abuses endangering paramount interests give occasion for permissible limitation."

University of San Diego law professor Bernard Siegan has written extensively on this subject and describes the situation quite well when he laments: "Few have better understanding of government abuses than the many organizations in the country dedicated to protecting civil and political rights. However, they never seem to apply this knowledge and prefer to look the other way when governmental agencies effectively deprive people of property, the fruit of their labor, savings, energy, and knowledge. They strenuously fight against the imposition of a minimal fine when political liberties are involved, and stand absolutely mute when the most arbitrary zoning and environmental restrictions reduce by hundreds or thousands of dollars the values of property owned by people of average means."

Let others take heed of what Oregonians have painfully learned: Once ground is lost, it is nearly impossible to regain.

Kelly Ross is a former aide to Sen. Mark Hatfield and is a member of the Curry County, Oregon, Board of Commissioners. He was active in Oregon Citizens for Fair Land Planning.