Central Oregon LandWatch v. Deschutes County ( 2023 )

No. 304 June 14, 2023 439
IN THE COURT OF APPEALS OF THE
STATE OF OREGON
CENTRAL OREGON LANDWATCH,
Respondent
Cross-Petitioner,
v.
DESCHUTES COUNTY,
Respondent
Cross-Respondent,
and
Michael GEMMET,
Petitioner
Cross-Respondent.
Land Use Board of Appeals
2022087; A180668
Argued and submitted April 10, 2023.
Lisa Andrach argued the cause for petitioner-cross-
respondent Michael Gemmet. Also on the briefs was Fitch
& Neary, PC.
Carol Macbeth argued the cause and filed the brief for
respondent-cross-petitioner Central Oregon LandWatch.
No appearance for respondent-cross-respondent Deschutes
County.
Before Ortega, Presiding Judge, and Powers, Judge, and
Hellman, Judge.
HELLMAN, J.
On petition, reversed; on cross-petition, affirmed.
440 Central Oregon LandWatch v. Deschutes County
Cite as 326 Or App 439 (2023) 441
HELLMAN, J.
Petitioner Gemmet seeks judicial review of an order
of the Land Use Board of Appeals (LUBA) that remanded
to Deschutes County a declaratory ruling that a use had
been “initiated” on the property acquired by Gemmet’s
company. Central Oregon LandWatch (COLW), on cross-
petition, seeks judicial review of the same order, arguing
that LUBA erred in dismissing COLW’s challenge to the
hearings officer’s authority to consider Gemmet’s applica-
tion. We review LUBA’s order to determine if it is “unlawful
in substance or procedure.” ORS 197.850(9)(a). Addressing
COLW’s cross-petition first, we conclude that LUBA did not
err with respect to the argument raised by COLW at LUBA.
In addition, we do not address COLW’s proffered construc-
tion of the Deschutes County Code (DCC) that COLW now
urges us to adopt, because COLW did not preserve that
issue below. Turning to Gemmet’s petition, we agree with
Gemmet that LUBA erred in remanding the hearings offi-
cer’s decision, because the issue of whether the guest ranch
use was abandoned sometime after the use was “initiated”
was beyond the scope of the specific proceeding brought,
and irrelevant to the initiation determination. Accordingly,
we reverse on Gemmet’s petition and affirm on COLW’s
cross-petition.
As background to understand the facts and LUBA’s
order, we start by setting out the applicable law. Under OAR
660-033-0140(1), a discretionary decision that approves a
“proposed development on agricultural or forest land out-
side an urban growth boundary * * * is void two years from
the date of the final decision if the development action is
not initiated in that period.” Deschutes County has imple-
mented that rule in DCC 22.36.010(B)(1), which provides
that “a land use permit is void two years after the date the
discretionary decision becomes final if the use approved in
the permit is not initiated within that time period.”1 DCC
22.36.010(D)(1) provides that “[a] determination of whether
1
Notably, DCC 22.36.010
“does not apply to * * * [t]hose determinations made by declaratory ruling
* * * that involve a determination of the legal status of a property, land use
or land use permit rather than whether a particular application for a spe-
cific land use meets the applicable standards of the zoning ordinance. Such
442 Central Oregon LandWatch v. Deschutes County
a land use has been initiated shall be processed as a declar-
atory ruling.” With respect to determining whether a land
use has been initiated, the DCC also provides:
“Notwithstanding any condition to the contrary in an
individual approval, a determination may be made for
any land use approval described in DCC 22.36.010(B) * * *,
under DCC 22.36.010(D)(1) as to whether a use was ‘ini-
tiated’ within the duration of the land use approval. If it
is determined that the use was ‘initiated’ during the life
of the permit, the permit will be considered to be a valid
existing permit and any land use described in the permit
will be deemed to be authorized under the County’s ordi-
nances, subject to any applicable revocation provisions.”
DCC 22.36.025(B). What must be shown for initiation of use
under a permit is set out in DCC 22.36.020, the elements of
which are not at issue in this judicial review.2
Finally, the code also sets out the declaratory rul-
ing process under DCC 22.40. What types of determinations
may be sought through the declaratory ruling process are
limited, and include, among other things, “[d]etermining
whether an approval has been initiated or considering the
revocation of a previously issued land use permit, quasi-
judicial plan amendment or zone change” and “[d]etermin-
ing the validity and scope of a nonconforming use.” DCC
22.40.010(A)(3), (4). That provision also provides that “[i]n
determinations, whether favorable or not to the applicant or landowner, shall
be final, unless appealed, and shall not be subject to any time limits.”
DCC 22.36.010(A)(2)(a).
2
DCC 22.36.020 provides:
“A. For the purposes of DCC 22.36.020, development action undertaken
under a land use approval described in DCC 22.36.010, has been ‘initiated’ if
it is determined that:
“1. The proposed use has lawfully occurred;
“2. Substantial construction toward completion of the land use approval
has taken place; or
“3. Where construction is not required by the approval, the conditions
of a permit or approval have been substantially exercised and any failure to
fully comply with the conditions is not the fault of the applicant.
“B. For the purposes of DCC 22.36.020, ‘substantial construction’ has
occurred when the holder of a land use approval has physically altered the
land or structure or changed the use thereof and such alteration or change
is directed toward the completion and is sufficient in terms of time, labor or
money spent to demonstrate a good faith effort to complete the development.”
Cite as 326 Or App 439 (2023) 443
all cases, as part of making a determination or interpreta-
tion the Planning Director (where appropriate) or Hearings
Body (where appropriate) shall have the authority to declare
the rights and obligations of persons affected by the ruling.”
DCC 22.40.010(A). However, that authority is limited by
DCC 22.40.010(B), (C), and (D), which provide:
“B. A declaratory ruling shall be available only in
instances involving a fact-specific controversy and to
resolve and determine the particular rights and obligations
of particular parties to the controversy. Declaratory pro-
ceedings shall not be used to grant an advisory opinion.
Declaratory proceedings shall not be used as a substitute
for seeking an amendment of general applicability to a leg-
islative enactment.
“C. Declaratory rulings shall not be used as a substi-
tute for an appeal of a decision in a land use action or for
a modification of an approval. In the case of a ruling on a
land use action a declaratory ruling shall not be available
until six months after a decision in the land use action is
final.
“D. The Planning Director may refuse to accept and
the Hearings Officer may deny an application for a declar-
atory ruling if:
“1. The Planning Director or Hearings Officer deter-
mines that the question presented can be decided in
conjunction with approving or denying a pending land
use action application or if in the Planning Director or
Hearings Officer’s judgment the requested determination
should be made as part of a decision on an application for
a quasi-judicial plan amendment or zone change or a land
use permit not yet filed; or
“2. The Planning Director or Hearings Officer deter-
mines that there is an enforcement case pending in district
or circuit court in which the same issue necessarily will be
decided as to the applicant and the applicant failed to file
the request for a declaratory ruling within two weeks after
being cited or served with a complaint.”
To obtain a declaratory ruling, the code requires
that “[e]ach application for a declaratory ruling shall
include the precise question on which a ruling is sought.
The application shall set forth whatever facts are relevant
444 Central Oregon LandWatch v. Deschutes County
and necessary for making the determination and such other
information as may be required by the Planning Division.”
DCC 22.40.020(B). Finally, as relevant here, DCC 22.40.040
provides that a declaratory ruling is conclusive, and an
applicant cannot reapply for a ruling on the same question.
The facts about the land use approval at issue here
are undisputed and were sufficiently set out by LUBA:
“The subject property is an approximately 155-acre tract
of land located near the city of Sisters, with the Deschutes
National Forest adjacent to the north, west, and southeast.
The subject property is zoned Exclusive Farm Use-Sisters/
Cloverdale (EFU-SC).
“In 2002, the county approved a conditional use permit
(CUP) for a guest ranch on the subject property. * * *
“The county approved a series of extensions of the CUP,
with the last extension ending on June 26, 2007. Some of
the infrastructure and cabins for the guest ranch were
partially constructed pursuant to the extended CUP. As
we understand it, development of the guest ranch under
the CUP may have been discontinued between 2009 and
2021. Running Waters Properties of Oregon LLC (Running
Waters) acquired the property in 2021. [Gemmet] is the
agent, owner, and managing member of Running Waters.
[Gemmet] submitted a county land use application in which
they stated that they were seeking a ‘Declaratory Ruling
for an Initiation of Use.’ ”
(Footnotes and record citations omitted.)
The county hearings officer held a public hearing
on Gemmet’s application for an initiation of use and issued
a declaratory ruling that the guest ranch had been “initi-
ated.” In making that determination, as relevant here, the
hearings officer addressed two issues raised by opponents
in that proceeding. The first issue related to COLW’s argu-
ment that the county could not issue a declaratory ruling
that the use had been initiated because the conditions in the
CUP had not been fulfilled. The hearings officer determined
that the arguments were outside the scope of the proceed-
ing, stating:
“This action is a Declaratory Ruling limited to the scope
of the question that is presented in the Application. This
Cite as 326 Or App 439 (2023) 445
Decision, by approving the Application, is not approving the
Guest Ranch. Rather, the Decision is determining solely
that the use already approved in the CUP Approval has
been initiated. The approval of the Guest Ranch already
occurred, and DCC 22.40.010(C) expressly prohibits using
the Declaratory Ruling as an appeal of an earlier land use
decision. * * * To the extent there is any question about the
permit holder’s compliance with conditions of approval, the
County has a separate enforcement process that can be
used to adjudicate those issues. The question of use initia-
tion can be determined whether or not the permit holder is
in compliance with conditions of approval and, therefore, is
not necessary to resolve in this proceeding.”
The hearings officer also addressed arguments that the
declaratory ruling of initiation could not issue because the
guest ranch use had been abandoned:
“Testimony from multiple participants asserts that the
Guest Ranch use has been ‘abandoned’ and, therefore, the
Application must be denied. For similar reasons, COLW
argues that the Application Notice and the Hearing Notice
were deficient because they did not identify Code provisions
relating to nonconforming uses. In support of these asser-
tions, COLW cites to ORS 215.130(5) et seq.
“ORS 215.130(5), and the subsequent statutes referring
to that statute, relate to nonconforming uses. Under that
statute, a use that lawfully existed at the time of a land
use regulation’s enactment can lawfully continue even if it
would no longer be allowed because of the new regulation.
Such uses, however, can lose that nonconforming status if
they are abandoned. That statute is not applicable here.
The Applicant does not seek to continue a nonconforming
use. Instead, the Applicant seeks only a determination that
a conforming, conditional use was initiated within a cer-
tain time. It was therefore also not an error for the County
to exclude nonconforming use criteria as part of its notices.”
COLW appealed the hearings officer’s decision to
the board of county commissioners, which issued an order
that it would not hear the appeal. Under DCC 22.32.035, the
hearing officer’s decision became the county’s final decision.
COLW then petitioned LUBA for review. As rele-
vant to our review, COLW first argued that Gemmet’s CUP
became void on the date of its expiration because proof of
446 Central Oregon LandWatch v. Deschutes County
initiation was not offered before the CUP expired. COLW
asserted that the hearings officer was thus unable, as a
matter of law, to determine that use was initiated under
a void permit. COLW also argued that the hearings officer
findings were inadequate and misconstrued the applica-
ble law for Gemmet’s declaratory ruling application with
respect to nonconforming use. COLW argued that the guest
ranch development ceased in 2009 and that the applicable
regulations had changed, making the use as a guest ranch
an abandoned nonconforming use, based on ORS 215.130(5)
and (7) and DCC 18.120.010. Relying on Fountain Village
Development Co. v. Multnomah Cty., 176 Or App 213, 31 P3d
458 (2001), rev den, 334 Or 411 (2002) (Fountain Village),
COLW asserted that the hearings officer erred in conclud-
ing that the nonconforming use statute was inapplicable
because the inchoate right to resume the guest ranch use
could be lost by abandonment unless Gemmet could demon-
strate conformance with current land use regulations for
guest ranches.
LUBA upheld the hearings officer’s decision on the
question of initiation. However, LUBA remanded to the
county with instructions to consider COLW’s arguments
of nonconforming use and abandonment. Gemmet peti-
tioned for review of LUBA’s remand order and COLW cross-
petitioned for review of LUBA’s decision on initiation.
We address COLW’s cross-petition first because a
decision in COLW’s favor on this issue would resolve this
case. COLW argues that LUBA’s ruling was unlawful in
substance in its interpretation of OAR 660-033-0140(1) and
DCC 22.36.020(A). In support of that assignment, COLW
argues that a land use is not “initiated” under the DCC
until the county has made a determination of initiation in
a declaratory ruling. COLW presents us with a code con-
struction argument that a development action was “initi-
ated” only if there was a formal determination by the county
that substantial construction or other actions listed in
DCC 22.36.020(A)(1) to (3) had occurred and the qualifying
actions alone were insufficient in the absence of that formal
determination. Based on that construction of the code pro-
vision, COLW argues that Gemmet brought the declaratory
Cite as 326 Or App 439 (2023) 447
application too late, because a determination of initiation
would have to have been made before the expiration of the
CUP.
We reject that argument because it was not pre-
served below. Before LUBA, COLW argued only that
Gemmet’s CUP became void on the date of its expiration
because proof of initiation was not offered before it expired.
COLW did not present LUBA with the code construction
argument that “initiation” means a formal determination
of use, not any on-the-ground actions that occurred under a
permit.
“Our rules and practice require a party to articulate
a contention in a lower court or tribunal in order to assert
on review that the court or tribunal erred in taking action
inconsistent with that contention.” Willamette Oaks, LLC v.
City of Eugene, 248 Or App 212, 225, 273 P3d 219 (2012).
That preservation requirement applies to review of LUBA
orders. Indeed, “the statutory context of the LUBA review
statutes lends particular force to the requirement of preser-
vation of error before the board.” Id. (citing VanSpeybroeck v.
Tillamook County, 221 Or App 677, 690-91, 691 n 5, 191 P3d
712 (2008)). Mindful of the statutory framework that defines
our review function of LUBA decisions, we decline to take up
COLW’s unpreserved construction of the DCC here, where
the county was not given the opportunity to address the pro-
posed construction and interpret its own code, and COLW
has not provided us with any reason why we should consider
its unpreserved argument. See Gage v. City of Portland, 133
Or App 346, 350, 891 P2d 1331 (1995) (“Although the task
of interpretation in cases such as this is ours, we will not
reverse a lower body’s interpretation on grounds that that
body was not given any required opportunity to consider.”).
To the extent that COLW argues that LUBA failed
to properly construe the DCC in addressing the argument
that COLW did bring before LUBA, we reject that argu-
ment. As LUBA correctly concluded, neither OAR 660-033-
0140(1) or the DCC require an application for declaration
of an initiation of use to be brought before the land use
approval expires. Moreover, both the OAR 660-033-0140(1)
and DCC 22.36.010(B)(1) provide that a permit is void only
448 Central Oregon LandWatch v. Deschutes County
if the use has not been initiated. As a result, by operation of
law, a land use approval is not void if the use has been initi-
ated. DCC 22.36.025(B) explicitly so provides, stating a per-
mit is a “valid existing permit” if “it is determined that the
use was ‘initiated’ during the life of the permit.” The DCC
does not similarly require that the determination must be
made during the life of the permit. As LUBA noted, based
on the context of the DCC including DCC 22.36.025 and
DCC 22.36.010(C)(1)(b), which contains a time limit for sub-
mitting an application to extend a CUP, “[t]he county clearly
knows how to insert a time requirement into an application
provision if it wishes to do so.” LUBA’s order was not unlaw-
ful in substance in rejecting COLW’s assignment of error.
Turning to Gemmet’s assignments of error in the
petition, we briefly address and reject his second assignment
of error first, in which he asserts that LUBA failed to defer
to the county’s interpretation of the DCC, as required by
Siporen v. City of Medford, 349 Or 247, 243 P3d 776 (2010).
We have long held that when a governing body declines to
review a hearings officer’s decision, the hearings officer’s
interpretation is not imputed to the governing body, such
that it is due deference. Gutoski v. Lane County, 141 Or App
265, 268, 917 P2d 1048, rev den, 324 Or 18 (1996); see also
Gould v. Deschutes County, 322 Or App 340, 350, 520 P3d
433 (2022) (distinguishing between a hearings officer’s
interpretation and a hearings officer’s application of prior
interpretation made by the board of county commissioners
and holding that only the latter is due deference). Here, the
county did not adopt the hearings officer’s interpretation as
its own when it declined to review the decision on COLW’s
appeal. As a result, “the hearings officer’s interpretation is
to be reviewed for whether it is correct as a matter of law.”
Tonquin Holdings, LLC v. Clackamas County, 247 Or App
719, 722-23, 270 P3d 397, rev den, 352 Or 170 (2012).
Finally, we turn to Gemmet’s first assignment of
error, which directly challenges LUBA’s remand. Gemmet
argues that, under the text and context of the applicable law,
the declaratory ruling on initiation of use that he sought did
not involve the nonconforming use standards, so the hear-
ings officer correctly declined to consider COLW’s arguments
Cite as 326 Or App 439 (2023) 449
on nonconforming use and abandonment. Therefore, he
argues, LUBA’s order remanding to the county to consider
those arguments was unlawful in substance. We agree.
First, LUBA’s decision was based on a mistaken
factual premise. LUBA determined that the hearings officer
may have decided that a finding that the guest ranch was ini-
tiated “necessarily means that the guest ranch may, subject
to the conditions of approval, be constructed and operate on
the subject property without any other limitations.” Because
of that purported ambiguity, LUBA determined that the
hearings officer could have sua sponte expanded the scope of
the hearing to such a degree that it was required to consider
arguments on nonconforming use and abandonment.
LUBA incorrectly found an ambiguity in the hear-
ings officer’s ruling. The hearings officer repeatedly and
explicitly recognized that the only question before it was
whether the guest ranch use had been “initiated” during the
lifetime of the CUP. And the hearings officer was clear the
question of “initiated” was the only question it was deciding.
Nothing in the hearings officer’s decision suggested that the
hearings officer believed that the decision would allow the
guest ranch to be constructed and operate without regard to
any code compliance issues that may exist. Indeed, such a
ruling would conflict with DCC 22.36.025(B) which explic-
itly recognizes that even if “the use was ‘initiated’ during
the life of the permit,” further land use actions would be
“subject to any applicable revocation provisions.”
Relatedly, LUBA’s analysis misunderstands the law
as it applies here. A declaratory action is not an expansive
proceeding that covers any and all issues related to a land
use permit. Instead, it is narrowly confined to answering
the “precise question” presented by the applicant. DCC
22.40.020(B); see also DCC 22.40.010(B) (stating that a
declaratory ruling is “available only in instances involving
a fact-specific controversy and to resolve and determine
the particular rights and obligations of particular par-
ties to the controversy” (emphasis added)). Further limit-
ing the scope of the proceeding are the restrictions on who
can seek a declaratory ruling and for what purposes. See
DCC 22.40.020(A) (limiting the applicants to the owner of
450 Central Oregon LandWatch v. Deschutes County
property on questions of use of the property, to the holder
of a permit on questions of interpretation of a quasi-judicial
plan amendment, zoning change or land use permit, or the
Planning Director). We also note that under DCC 22.40.040,
the effect of a declaratory ruling is conclusive, binds the par-
ties, and prevents the parties from reapplying for a ruling
on the same question. The binding and preclusive nature of
a declaratory ruling supports our conclusion that the county
intended declaratory actions to have a limited scope.
In sum, those limits confirm that the hearings offi-
cer is not authorized to expand the scope of what is to be
decided by declaratory ruling on a particular application
beyond what the applicant has submitted. In this case, that
was the question submitted by Gemmet on his application:
“Declaratory Ruling for an Initiation of Use.” Thus, although
the hearings officer had authority to “declare the rights
and obligations of persons affected by the ruling,” DCC
22.40.010(A), that authority was not unlimited. It could only
be exercised within the contours established by the county
code, and under that code, by the “precise question” submit-
ted by Gemmet.
The issues raised by COLW related to nonconform-
ing use were not directed at initiation of use, which was
Gemmet’s “precise question.” Instead, they focused on the
lack of action on the part of the property owner after the ini-
tiation of the use. Those issues were thus outside the scope
of the declaratory ruling application. LUBA’s remand would
therefore have the effect of requiring the hearings officer to
decide a legal issue that was not before it, and which had not
been noticed as part of the hearing. But the hearings officer
cannot make advisory opinions or decide questions that are
more appropriately addressed to a different procedure. See
DCC 22.40.010(B), (C), (D).
LUBA’s reliance on Norvell v. Portland Area LGBC,
43 Or App 849, 604 P2d 896 (1979), for the proposition that
the hearings officer had to address the merits of COLW’s
arguments on nonconforming uses was also misplaced.
Given the scope of Gemmet’s “precise question,” the non-
conforming use standards do not inform whether a use had
been initiated. For all of those reasons, the hearings officer
Cite as 326 Or App 439 (2023) 451
properly addressed the arguments raised on nonconforming
use and abandonment when it correctly determined that
they were not within the scope of the proceeding.
Finally, COLW’s arguments based on Fountain
Village are unpersuasive. We understand COLW to be argu-
ing that, at most, Gemmet had an inchoate right to develop
(if the use had been initiated) that is analogous to the
common-law vested right discussed in Fountain Village. We
further understand COLW to argue that that to confirm that
kind of right Gemmet had to establish that the guest ranch
use could be continued as a nonconforming use as provided
in ORS 215.130(5) and (7) and DCC 18.120.010. Fountain
Village, however, is not analogous to the initiation of use
declaratory ruling that Gemmet sought because Gemmet’s
application did not involve a common-law property right.
The issue in Fountain Village was whether a land-
owner had a common-law vested right to complete construc-
tion of a log cabin on his property. 176 Or App at 215. A prior
owner had started building the cabin when the zoning on the
land allowed it as of right. Later, the zoning on the land had
changed such that the cabin was a conditional use. The land-
owner bought the property under the new zoning and did not
seek to resume construction of the cabin for a few years. Id. at
215-17. The county concluded that the landowner did not have
a vested right to complete the cabin because it was a discon-
tinued nonconforming use, explaining that a vested right is
simply a right to complete a nonconforming use. Id. at 217.
LUBA affirmed the county’s decision, and the landowner peti-
tioned for our review. We likewise concluded that common-law
vested rights are, in effect, inchoate nonconforming uses.
Id. at 221. As such, we concluded that the county had the
authority to apply the discontinued nonconforming use ordi-
nance to its determination of whether the landowner had a
vested right to complete the cabin. Id. at 223.
We revisited our Fountain Village opinion in Oregon
Shores v. Board of County Commissioners, 297 Or App 269,
441 P3d 647 (2019). That case involved landowners seeking
a vested right determination under Measure 49 to continue
developing a subdivision on their property. In address-
ing whether nonconforming use standards applied to that
452 Central Oregon LandWatch v. Deschutes County
determination, we explained the distinction between the
common-law vested right at issue in Fountain Village, and
the statutory right at issue in Oregon Shores. Id. at 276. A
common-law vested right to develop is an equitable claim
to an inchoate nonconforming use that requires showing a
current vested right to develop at the time that the claim is
made. Id. at 276, 279. The Measure 49 vested right, however,
was a statutory right to a particular remedy that required
showing a common-law vested right existed on the effective
date of the act, December 6, 2007. Id. at 277-78. As a result,
nothing that occurred after that date was relevant to the
statutory determination, such as the alleged discontinuance
of the nonconforming use in that case. Id. In addition, “[u]n-
like the right at issue in Fountain Village * * * a successful
claim under section 5(3) [of Measure 49] yields not an incho-
ate nonconforming use under the common law but, rather, a
development right expressly allowed by statute.” Id. at 279.
The issue here is more analogous to Oregon Shores
than Fountain Village. Gemmet is not seeking a determi-
nation of a common-law vested right, which we have said is
an inchoate nonconforming use. He is seeking a declaratory
ruling that the use allowed under the CUP was initiated
during the lifetime of the permit, because, if it was, the CUP
remains a valid, existing permit. That is not a right arising
under the common law, nor is it “inchoate,” because both the
applicable state rule, OAR 660-033-0140(1), and the appli-
cable DCC provisions provide that the CUP never was void
if the use was initiated. That is, there was no formless or
amorphous right that needed to be finalized or confirmed,
the CUP, as a matter of law, continued as a valid, existing
permit once the use was initiated during the lifetime of the
permit. Also, like in Oregon Shores, here, the applicable
DCC provisions place a date certain on which to make the
initiation of use determination—during the lifetime of the
permit—anything that occurred after that time was not rel-
evant to that determination.3 In sum, LUBA’s remand was
unlawful in substance, and we reverse it.
On petition, reversed; on cross-petition, affirmed.
3
Because it is unnecessary to our disposition, we do not address Gemmet’s
additional arguments that LUBA’s remand violates ORS 215.416(8)(a) and ORS
215.427(3).