Court Opinion

ID: 9940506
Source: CourtListenerOpinion
Date Created: 2024-02-14 17:12:35.667275+00
Date Added: 2024-06-11T13:44:56.585671
License: Public Domain

No. 95              February 14, 2024                  723

         IN THE COURT OF APPEALS OF THE
                 STATE OF OREGON

                    Joel HAUGEN,
                      Petitioner,
                           v.
                CITY OF SCAPPOOSE
               and David Weekley Homes,
                     Respondents.
               Land Use Board of Appeals
                   2023001; A182362

  Argued and submitted November 15, 2023.
   E. Michael Connors argued the cause for petitioner. Also
on the brief was Hathaway Larson, LLP.
   Garrett H. Stephenson argued the cause for respon-
dents. Also on the brief were Bailey M. Oswald, Ashleigh K.
Dougill, and Schwabe, Williamson & Wyatt, P.C.
   Before Aoyagi, Presiding Judge, and Joyce, Judge, and
Jacquot, Judge.
  JACQUOT, J.
  Reversed and remanded.
724                                      Haugen v. City of Scappoose

         JACQUOT, J.
         The City of Scappoose approved intervenor David
Weekley Homes’s consolidated planned development appli-
cation (the application) for an approximately 17-acre prop-
erty adjacent to Scappoose Creek.1 Petitioner appealed the
city’s decision to the Land Use Board of Appeals (LUBA),
which denied five of petitioner’s seven assignments of error
and remanded as to the remaining two. Petitioner now
seeks judicial review of LUBA’s final opinion and order,
contending that LUBA erred in its rejection of three of his
assignments of error before LUBA. First, petitioner argues
that LUBA erred in rejecting petitioner’s argument that,
although the planning commission had conducted a de novo
hearing for the application, closed the record, and recom-
mended approval to the Scappoose City Council, under the
Scappoose Municipal Code (SMC), the council was required
to conduct an additional de novo hearing, and to allow peti-
tioner and others to submit further evidence in opposition to
the application. Second, petitioner argues that LUBA erred
in rejecting his argument that intervenor’s proposed condi-
tion of approval, to lower the number of lots from 48 to 44
and increase the minimum lot size from 3,400 square feet to
4,000 square feet, and intervenor’s assertions made in sup-
port of the adoption of that condition, constituted “evidence”
as that term is defined in the relevant statute, and that,
therefore, petitioner had a procedural right to respond to
the proposed condition. Third, petitioner argues that LUBA
erred in concluding that the council’s approval of the appli-
cation was supported by adequate findings and substantial
evidence.
         For the reasons explained below, we affirm on peti-
tioner’s first assignment of error and reverse on his sec-
ond and third assignments. We conclude that LUBA erred
in rejecting on procedural grounds petitioner’s argument
that the new information submitted by intervenor was “evi-
dence,” and in declining to address the merits of petition-
er’s adequate findings and substantial evidence argument
on the grounds that the city council approved the original
    1
      Intervenor applied for a subdivision tentative plan, planned development
overlay, conditional use, and sensitive land development permits for floodplain,
wetlands, slope hazard, and fish and riparian corridors.
Cite as 330 Or App 723 (2024)                                               725

48-lot proposal rather than the modified 44-lot proposal.
Accordingly, we reverse and remand.
                                    FACTS
         The relevant facts are procedural. Intervenor filed a
consolidated application in the City of Scappoose for “needed
housing,” including a planned development overlay request.2
On October 6, 2022, the city published a notice that the
planning commission would hold a public hearing on the
consolidated application on October 27. Seven days before
the hearing, the planning commission issued a staff report,
made available to the public, which included findings that
addressed the relevant approval criteria. On October 27,
the planning commission voted to leave the record open for
10 additional days to allow petitioner and his attorney suffi-
cient time to review the materials and prepare their written
testimony and granted intervenor seven days after the close
of the 10-day period to offer a rebuttal. The hearing was con-
tinued on November 17, and the planning commission voted
to recommend approval to the city council.
         The city council held a public hearing on December 5,
2022, and allowed additional oral testimony, including
that of petitioner and his attorney, followed by intervenor’s
rebuttal. However, the council did not allow submission of
new written evidence, instead relying on the record created
before the planning commission. After the testimony, a num-
ber of council members expressed concerns about, among
other things, lot size and density. The council did not act
on the application at that time. When the council returned
for deliberations on December 12, it reopened the record
pursuant to ORS 197.522(3) (2021), amended by Or Laws
2023, ch 13, § 85, for the sole purpose of allowing intervenor
    2
      In 2023, the legislature amended, renumbered, and reorganized the stat-
utes related to “needing housing.” Or Laws 2023, ch 13. We refer to the stat-
utes in effect at the time of the relevant events in this case. “Needed housing”
refers to housing that is shown to meet the need for housing within an urban
growth boundary, on land zoned for residential or mixed residential use, at prices
and rent levels that are affordable to a variety of incomes. Former ORS 197.303
(2021), amended by Or Laws 2023, ch 13, § 27; Or Laws 2023, ch 223, § 18a; Or
Laws 2023, ch 326, §14, renumbered as 197A.348 (2023). A planned development
overlay is used to provide more flexibility in land use and gives the planning
commission the ability to approve applications that may not otherwise conform
with a land zone’s requirements. SMC 17.81.010.
726                                        Haugen v. City of Scappoose

to propose a condition of approval to address the council’s
concerns about minimum lot size.3 Intervenor proposed the
imposition of Condition 53, which limited the number of lots
to 44 (rather than 48) and required a minimum lot size of
4,000 square feet (rather than 3,410). Petitioner was not
allowed an opportunity to comment on or otherwise respond
to the proposed condition or intervenor’s assertions during
his presentation regarding the condition. The council then
approved the application and adopted the findings in the
October 20 staff report as its own.
        In his appeal of the decision to LUBA, petitioner
asserted, as relevant here, that, (1) by failing to hold a sec-
ond de novo hearing—instead relying on the evidence sub-
mitted before the planning commission—the city council
committed procedural errors that prejudiced petitioner’s
substantial rights; (2) the council improperly denied peti-
tioner an opportunity to respond to new evidence submitted
by intervenor regarding the condition of approval; and (3)
the council’s approval of the 44-lot project was not supported
by adequate findings or substantial evidence, because the
evidence in the record only addresses the 48-lot proposal
approved by the planning commission.
         As to petitioner’s first argument, LUBA concluded
that petitioner had not established procedural error, and
therefore no basis for reversal or remand on that ground,
because he failed to challenge the city council’s reliance on a
subsection of the SMC that did not require a de novo hearing
in this instance. As to petitioner’s second argument, LUBA
concluded that, notwithstanding petitioner’s argument that
several specific statements by intervenor’s counsel asserting
facts that were otherwise not present in the record consti-
tuted evidence, petitioner had not established that the infor-
mation submitted by intervenor when the council reopened
the record under ORS 197.522(3) (2021) was “evidence,”
as defined in ORS 197.797(9)(b), such that petitioner was
entitled to an opportunity to respond to that information.
    3
      ORS 197.522(3) (2021) provides that, “[i]f an application is inconsistent with
the comprehensive plan and applicable land use regulations, the local govern-
ment, prior to making a final decision on the application, shall allow the appli-
cant to offer an amendment or to propose conditions of approval that would make
the application consistent with the plan and applicable regulations.”
Cite as 330 Or App 723 (2024)                                727

Lastly, as to petitioner’s third argument, LUBA concluded
that the council had approved the 48-lot proposal with a con-
dition of approval limiting the development to 44 lots, rather
than a 44-lot proposal. Because petitioner did not identify
any criteria that he believed were violated by the council’s
approval of a 48-lot proposal with a condition of approval
limiting the number of lots, LUBA concluded that petitioner
had not developed an argument necessary for its review.
                  STANDARD OF REVIEW
         We review LUBA’s order to determine whether it is
“unlawful in substance or procedure.” ORS 197.850(9)(a). “A
LUBA order is unlawful in substance if it represents a mis-
taken interpretation of the applicable law.” Kine v. Deschutes
County, 313 Or App 370, 372, 496 P3d 1136, rev den, 369 Or
69 (2021) (internal quotation marks and brackets omitted). In
assessing a substantial-evidence challenge, we do not “assess
whether the local government erred in making a finding, but
to determine whether LUBA properly exercised its review
authority. Citizens for Responsibility v. Lane County, 218
Or App 339, 345, 180 P3d 35 (2008). “[W]here LUBA properly
articulates its substantial-evidence standard of review * * *,
we will not reverse its determination unless there is no evi-
dence to support the finding or if the evidence in the case is ‘so
at odds with LUBA’s evaluation that a reviewing court could
infer that LUBA had misunderstood or misapplied its scope
of review.” Stevens v. City of Island City, 260 Or App 768, 772,
324 P3d 477 (2014) (citing Younger v. City of Portland, 305 Or
346, 358-59, 752 P2d 262 (1988)). We may reverse or remand
based on LUBA’s procedural choices only when the proce-
dure is “unlawful” and prejudices the substantial rights of
the petitioner. ORS 197.850(9)(a); see also Waveseer of Oregon,
LLC v. Deschutes County, 308 Or App 494, 500, 482 P3d 212
(2021) (rejecting procedural challenge where county did not
identify a source of law that would allow the court to conclude
that LUBA’s procedural choices were unlawful).
                          ANALYSIS
        In petitioner’s first assignment of error, he contends
that LUBA erred in rejecting his argument that the proce-
dures specified in SMC 17.162.130 applied and required the
728                             Haugen v. City of Scappoose

city council to hold a second de novo hearing after receiv-
ing the planning commission’s recommendation. LUBA con-
cluded that the council had conducted its hearing as pre-
scribed by SMC 17.22.030, which requires that the council’s
review of a quasi-judicial zone change—which the parties
agree was at issue here—shall be on the planning commis-
sion’s record, and that petitioner was therefore not entitled
to a second de novo hearing before the council. Although
petitioner contended in his reply brief that SMC 17.22.030
did not apply, LUBA reasoned that petitioner had not chal-
lenged the council’s findings that SMC 17.22.030 applied,
explained why it did not apply, or explained why it did not
limit the council’s hearing procedures. On review, petitioner
asserts that LUBA erred by “ignoring” petitioner’s argument
in his reply brief regarding SMC 17.22.030. He maintains
that LUBA’s order was therefore unlawful in substance and
should be reversed.
         As noted above, a LUBA order is unlawful in sub-
stance if it represents a mistaken interpretation of the
applicable law. Kine, 313 Or App at 372. LUBA’s rules
require a petitioner to assign error in the petition for review
and demonstrate either that the issue was raised below or
explain why preservation is not required. OAR 661-010-
0030(4)(d). A petitioner’s reply brief “shall not include new
assignments of error or advance new bases for reversal or
remand” and is limited to responses to arguments in the
respondent’s brief. OAR 661-010-0039. Just as in other pro-
ceedings, parties before LUBA are required to preserve their
arguments for review in this court. Willamette Oaks, LLC v.
City of Eugene, 295 Or App 757, 765, 437 P3d 314, rev den,
365 Or 192 (2019); see ORAP 5.45(1) (“No matter claimed as
error will be considered on appeal unless the claim of error
was preserved in the lower court[.]”). An argument that is
“qualitatively different” than the argument made before
LUBA is likewise not preserved for our review. Willamette
Oaks, LLC, 295 Or App at 766.
        In his petition for review before LUBA, petitioner
argued that SMC 17.162, which sets out the procedures for
quasi-judicial decision making, governed the city council’s
review of the application, and SMC 17.162.130 specifically
Cite as 330 Or App 723 (2024)                            729

required the council to conduct a de novo hearing. Intervenor
responded that the council relied on a different section,
SMC 17.22.030, which sets out additional procedures for a
quasi-judicial comprehensive plan and zone change amend-
ments, and properly conducted an on-the-record review,
and that the council had articulated as much in its find-
ings. Petitioner’s reply on that issue consisted of two sen-
tences: “City Council never explained the basis for imposing
the procedural restrictions, and clearly did not rely on SMC
17.22.030. City Council’s findings for SMC 17.22.030 do not
reference the on-the-record review or address any of the pro-
cedural restrictions.”
         LUBA explained that, by adopting the findings in
the October 20 staff report, which was made available to
the public prior to the planning commission hearing, the
city council had identified SMC 17.22.030 as the basis for
its on-the-record review. The staff report included the entire
text of the provision and indicated that it applied in these
circumstances. LUBA noted that petitioner’s assertion that
the council did not identify SMC 17.22.030 below was incor-
rect, and petitioner had not addressed the city’s findings
under that provision. Because petitioner did not challenge
the council’s findings in his petition for review and had not
developed a challenge to it even in his reply brief, LUBA
accepted the council’s determination that SMC 17.22.030
applied.
         LUBA did not err. Petitioner made no mention of
SMC 17.22.030 until his reply brief to LUBA, and, even
then, he did not squarely challenge the city council’s use of
that provision or develop an argument about the adequacy
of the council’s findings under it. On review in this court,
petitioner has not explained why his brief reference to SMC
17.22.030 properly raised the issue or developed an argu-
ment for LUBA’s review. We conclude that LUBA complied
with its own procedural rules, and its order was therefore
not unlawful in procedure. To the extent that petitioner now
challenges the adequacy of the council’s findings regarding
SMC 17.22.030, because petitioner did not raise those argu-
ments before LUBA, we do not address them now.
730                             Haugen v. City of Scappoose

         In his second assignment of error, we understand
petitioner to assert that LUBA erred by declining to address
the merits of his argument that the information intervenor
discussed with the city council after it reopened the record
was “evidence.” ORS 197.797(9)(b) defines “evidence” in the
context of a land use hearing as “facts, documents, data or
other information offered to demonstrate compliance or non-
compliance with the standards believed by the proponent to
be relevant to the decision.”
         Petitioner argued before LUBA that the city coun-
cil had reopened the record under ORS 197.522(3) (2021)
specifically to allow intervenor to address the council’s con-
cerns about density, lot size, and floodplain issues, and that
the “modified plan” was in itself new evidence because it
“significantly changed the proposal.” As noted above, ORS
197.522(3) (2021) allows reopening the record only “[i]f an
application is inconsistent with the comprehensive plan and
applicable land use regulations.” Petitioner also identified
specific factual assertions made by intervenor’s counsel
while the record was reopened that were offered to convince
the council—the decisionmaker—to approve the applica-
tion, as limited by the condition, notwithstanding the coun-
cil’s apparent conclusion that the original application was
“inconsistent with the comprehensive plan and applicable
land use regulations.” ORS 197.522(3) (2021). Petitioner
argued that because intervenor had presented new evidence,
petitioner had a procedural right to respond under Fasano v.
Washington Co. Comm., 264 Or 574, 507 P2d 23 (1973) and
Woodstock Neigh. Assoc. v. City of Portland, 28 Or LUBA
146 (1994), both of which, petitioner argued, stand for the
proposition that all participants in a land use hearing have
a right to rebut evidence placed before the decisionmaker.
         Intervenor asserted a largely statutory argument
in response, claiming that ORS 197.522(3) (2021) provides
“applicants, and only applicants,” an opportunity to offer
amendments or conditions of approval to bring an applica-
tion into compliance once a decisionmaker tentatively deter-
mines that the application does not meet the applicable
standards. He argued that the statute does not provide for
other parties to respond to proposed conditions and that, in
Cite as 330 Or App 723 (2024)                             731

any event, under Marine St. LLC v. City of Astoria, 37 Or
LUBA 587, 597 (2000), a proposed condition of approval is
not new evidence, and so petitioner had no procedural right
to respond.
         LUBA did not adopt either party’s argument. LUBA
agreed with petitioner that intervenor’s statements to city
council, after it had reopened the record pursuant to ORS
197.522(3) (2021), that 44 was the fewest number of lots
intervenor could make “pencil” while maintaining a mini-
mum lot size of 4,000 square feet constituted “new informa-
tion.” (Emphasis in original.) See ORS 197.797(9)(b) (evidence
includes “information offered to demonstrate compliance or
noncompliance with the standards believed by the proponent
to be relevant to the decision”). However, LUBA concluded
that petitioner had not developed an argument that that
information was “evidence” as that term is defined in ORS
197.797(9)(b), because petitioner failed to identify specific
standards or approval criteria that required the imposition
of a condition limiting the number of lots or requiring a min-
imum lot size for the type of application at issue. LUBA also
suggested that petitioner had not identified any purported
new evidence beyond the condition of approval itself, which,
under Marine St. LLC, is not evidence. Consequently, LUBA
did not address whether, under ORS 197.522(3) (2021), peti-
tioner had a right to rebut any new evidence.
         We conclude that LUBA’s order is unlawful in sub-
stance because LUBA erred in declining to address peti-
tioner’s argument that the information provided by inter-
venor was evidence that petitioner had a right to rebut. In
declining to reach that argument, LUBA reasoned that peti-
tioner’s argument was not specific enough because he did
not identify specific approval standards to which the new
information related and did not develop his argument that
the information was evidence, “that is, information related
to approval criteria.” However, petitioner asserted below,
and again on appeal, that the record was reopened under
ORS 197.522(3) (2021) because city council members had
expressed serious concerns that the application did not meet
the relevant standards. Indeed, the council’s choice to reopen
the record under ORS 197.522(3) (2021) indicated that it had
732                              Haugen v. City of Scappoose

determined that the application was “inconsistent with the
comprehensive plan and applicable land use regulations.”
         Petitioner also identified—with as much specificity
as the city council had—the standards the council mem-
bers were specifically concerned about, including Council
President Greisen’s concerns, shared by Councilor McHugh,
about the “density, lot sizes and floodplain since the R-1
zone is a low-density residential zone and a significant
amount of the property is within the floodplain.” Petitioner
also recounted the content of statements made by interve-
nor’s counsel regarding density, lot size, and the floodplain,
including explanations of engineering issues related to and
the financial feasibility of smaller lot sizes, how the lot sizes
would impact the ability to protect Scappoose Creek and
other natural resources on the property, and whether proj-
ect amenities would “pencil” if intervenor were to abandon
the current application for a planned development overlay
and instead file a 46-lot subdivision application that did not
require the same project amenities.
         Nothing in the statutory definition of evidence in
ORS 197.797(9)(b) nor in LUBA’s caselaw indicates that the
information and argument provided by petitioner in this
case were insufficient for LUBA to address his argument.
LUBA itself has held that ORS 197.797(9)(b) “defines ‘evi-
dence’ quite broadly,” Friends of the Hood River Waterfront
v. City of Hood River, 67 Or LUBA 179, 194-95 (2013), and
LUBA did not explain why petitioner’s recitation of specific
statements made by city council members related to the
requirements for the specific zone for which they were con-
sidering a zone change and overlay request—which, under
the circumstances, represented a conclusion that the appli-
cation did not comply with relevant standards—and inter-
venor’s statements in response, were not specific enough.
Petitioner’s argument was developed enough that LUBA
could not fairly reject it for being inadequately developed.
See ORS 197.835(11)(a) (“Whenever the findings, order and
record are sufficient to allow review, and to the extent possi-
ble consistent with the time requirements of ORS 197.830(14),
the board shall decide all issues presented to it when revers-
ing or remanding a land use decision * * *.”); see also Schaefer
Cite as 330 Or App 723 (2024)                            733

v. Marion County, 318 Or App 617, 639, 509 P3d 718 (2022)
(reversing LUBA’s rejection of a petitioner’s argument on the
ground that the petitioner had failed to adequately develop
the argument or identify certain evidence in the record;
explaining that the petitioner’s argument before LUBA fully
addressed the point and that LUBA had erred in failing to
address the merits of the argument); Gunderson, LLC v. City
of Portland, 243 Or App 612, 626, 259 P3d 1007 (2011), aff’d,
352 Or 648, 290 P3d 803 (2012) (holding that LUBA’s order
was unlawful in substance when LUBA failed to consider an
issue sufficiently presented to it).
          Nor does LUBA’s citation to Marine St. LLC dispose
of petitioner’s argument. In that case, the petitioner argued
that a condition of approval itself was new evidence, and
LUBA rejected that argument. 37 Or LUBA at 597-98. In
this case, by contrast and as noted above, petitioner identi-
fied several statements made by intervenor’s counsel as well
as the modified proposal as evidence; the identified items
went significantly beyond the text of the condition itself. In
sum, under these circumstances, LUBA had to address the
merits of petitioner’s argument that the new information
presented by intervenor during the reopened record period
under ORS 197.522(3) (2021) was evidence within the mean-
ing of ORS 197.797(9)(b).
         We turn to petitioner’s third assignment of error.
Before LUBA, petitioner argued that, given the procedural
circumstances, the city council had approved a 44-lot project
without making the findings necessary to support such a
project. LUBA held that, because the council had adopted
the planning commission staff report, the council had found
that the 48-lot proposal met the applicable standards and,
after reaching that conclusion, the council simply imposed a
condition increasing the minimum lot size and limiting the
number of lots to 44. LUBA concluded that, because peti-
tioner’s arguments addressed a 44-lot project, those argu-
ments addressed only the condition reducing the number of
lots to 44, rather than the adequacy of the findings to sup-
port the council’s approval—which, LUBA concluded, was
of the 48-lot project. Because petitioner (like the council)
had not identified any standards that required imposition
734                             Haugen v. City of Scappoose

of the condition, LUBA reasoned, petitioner had not raised
any arguments for LUBA to address on the merits. That
is, petitioner’s argument before LUBA rested on the prem-
ise that, given the procedures it followed, the council had
approved only a 44-lot project. LUBA rejected that prem-
ise and instead relied solely on the face of the ordinance
approving the application to conclude that the council had
approved a 48-lot project.
         On review, petitioner contends that LUBA’s order
was unlawful in substance because LUBA failed to address
his argument. We agree. LUBA rejected out of hand petition-
er’s premise that, under the circumstances, the city council
approved a 44-lot project, but LUBA did not explain how the
procedure the council followed allowed the conclusion that
it had approved a 48-lot project. As explained above, after
the record was closed, council members expressed concerns
about whether the applied-for 48-lot project met the applica-
ble standards. The council then reopened the record under
ORS 197.522(3) (2021), which applies only if an application
does not meet the applicable standards. The council received
new information from intervenor and decided to approve the
application on the condition that it include only 44 lots with
a larger minimum size than the lots identified in the appli-
cation. Then the council adopted the planning commission
staff report, which supported the applied-for 48-lot project.
         There is an inconsistency between, on one hand, the
city council’s stated concerns about the application and sub-
sequent decision to reopen the record under ORS 197.522(3)
(2021) to allow for a condition of approval addressing those
concerns—both of which indicate that the council had deter-
mined that the 48-lot application was “inconsistent with the
comprehensive plan and applicable land use regulations”—
and, on the other hand, the council’s statement in its final
decision that it was adopting the planning commission’s
staff report and recommendation to approve the 48-lot pro-
posal. Petitioner’s argument was that, in light of that incon-
sistency, the council should be understood to have approved
only a 44-lot project, notwithstanding its configuration of
the ordinance as approving a 48-lot project with a condition
limiting the number and minimum size of the lots. LUBA
Cite as 330 Or App 723 (2024)                            735

did not explain why, given the procedures the council fol-
lowed, petitioner’s understanding was incorrect. By failing
to engage with the facts underlying petitioner’s argument
that the council’s order was not supported by substantial evi-
dence and reason, LUBA misapplied its standard of review,
and its order is therefore unlawful in substance. See Rogue
Advocates v. Jackson County, 282 Or App 381, 289, 385 P3d
1262 (2016) (“[T]he substantial evidence standard of review
includes a substantial reason requirement. To satisfy that
requirement, an agency order must supply an explanation
connecting the facts of the case and the result reached.”).
         In sum, we reject petitioner’s first assignment of
error. On his second and third assignments, we conclude that
LUBA erred in declining to address petitioner’s contention
that the new information presented by intervenor during the
period in which the city council reopened the record under
ORS 197.522(3) (2021) was “evidence” within the meaning
of ORS 197.797(9)(b), and in concluding that the council
approved the original 48-lot proposal without accounting
for the council’s reliance on ORS 197.522(3) (2021) and the
resulting imposition of the condition decreasing the number
of and increasing the minimum size of the lots. Accordingly,
we remand for LUBA to consider the merits of those issues
and determine whether petitioner was entitled to an oppor-
tunity to rebut any new evidence and whether the council’s
approval of the application is supported by adequate find-
ings and substantial evidence.
        Reversed and remanded.