- Court: Oregon Land Use Board of Appeals
- Area(s) of Law: Land Use
- Date Filed: 10-30-2020
- Case #: 2020-009
- Judge(s)/Court Below: Opinion by Rudd
- Full Text Opinion
The city adopted an ordinance to prohibit the establishment of new fossil fuel terminals (FFTs) and the expansion of existing FFTs. This appeal followed.
Under ORS 197.175(2)(d), Statewide Planning Goal 2 (Land Use Planning), and Portland City Code (PCC) 33.835.040, land use decisions, including zoning ordinance amendments, must be consistent with the city’s comprehensive plan. Under Goal 2, land use decisions must be supported by an “adequate factual base.” City of Portland Comprehensive Plan (CP) Policy 4.79 is to “[l]imit development in or near areas prone to natural hazards.” Because most of the city’s industrial zoning is in areas with high levels of liquefaction susceptibility, the city found that the amendments would limit the increase in storage of fossil fuels in a hazardous area and were therefore consistent with CP Policy 4.79. In the second assignment of error, petitioners argue this finding is not supported by an adequate factual base and that allowing new FFTs would actually decrease risk because (1) most existing FFTs were built with limited seismic design criteria, (2) it is more challenging to seismically upgrade existing structures than to build new ones, and (3) allowing new FFTs would enable existing FFTs to relocate to more stable soil. Because the prior ability to expand storage capacity did not yield many seismic upgrades, LUBA concludes the city’s finding of consistency with CP Policy 4.79 has an adequate factual base.
CP Policy 6.48 is to “[l]imit fossil fuels distribution and storage facilities to those necessary to serve the regional market.” Because a modest growth projected in petroleum demand will not exceed peak volumes that the city’s FFTs handled in the past, and because state, regional, and local policies exist to shift from petroleum to electricity and natural gas, the city concluded the amendments were consistent with this policy. LUBA agrees with petitioners that, because natural gas falls under the city’s definition of fossil fuels, and because the city does not explain how the natural gas needed to meet any increased demand will be available if fossil fuel storage may not be increased, the city’s finding of consistency with this policy does not have an adequate factual base. Although the city’s only existing natural gas FFT has no plans to increase storage, the city does not argue other companies could not utilize natural gas facilities. In addition, the fact that the projected growth in petroleum demand does not exceed peak volumes handled by the city’s FFTs does not explain how the amendments ensure adequate natural gas storage. The second assignment of error is therefore sustained, in part.
In finding that amendments were consistent with various CP policies, the city stated it had “[c]onsidered applicable policies to determine that [the amendments] on the whole compl[y] with the [CP] and on balance [are] equally or more supportive of the goals and policies of the [CP] than the current regulations. In reaching this conclusion, the City Council has weighed and balanced competing policy directions.” In the first assignment of error, petitioners argue the city improperly used a balancing test to evaluate consistency with the CP. Although balancing is permissible in the quasi-judicial context only when the standards themselves are incompatible, LUBA has previously held that local governments have more flexibility to balance policies in the legislative context. The first assignment of error is therefore denied.
In the third assignment of error, petitioners challenge the city’s findings of consistency with various CP policies. Under CP Policy 6.23, the city must “[e]ncourage investment in transportation systems and services that will retain and expand [its] competitive position as a West Coast trade gateway and freight distribution hub.” The CP defines “encourage” as “to promote or foster using some combination of voluntary approaches, regulations, or incentives.” The city concluded this policy applies to the city as a whole and not to individual businesses or sectors, and that the city’s voluntary approaches to promote or foster investment in transportation systems and services do not have to extend to FFTs. The city concluded the amendments are consistent with this policy because the city will continue to invest in and encourage public sector transportation investments and because FFTs will still be able to invest in their non-storage components. LUBA concludes this interpretation is plausible, and that the city’s findings have an adequate factual base.
Under CP Policy 6.41, the city must “[e]ncourage freight-oriented industrial development to locate where it can maximize the use of and support reinvestment in multimodal freight corridors.” The city concluded this policy applies to zoning districts as a whole and not to individual businesses or sectors. The city concluded the amendments are consistent with this policy because the city promotes the location of industrial development through zoning and investments set out in its comprehensive plan and because the amendments will affect neither zoning nor those investments. LUBA concludes this interpretation is consistent with the policy’s text, and that the city’s findings have an adequate factual base.
Under CP Policy 6.7, the city must “[m]aintain and strengthen [its] comparative economic advantages including access to a high-quality workforce, business diversity, competitive business climate, and multimodal transportation infrastructure.” The city concluded “strengthen” means “to make stronger, improve.” The city concluded the amendments are consistent with this policy because the policy applies to the city as a whole and not to individual businesses or sectors. LUBA agrees with petitioners that the city’s findings are inadequate because, although the amendments apply directly to only one sector, the findings fail to address how the amendments will improve the city’s comparative economic advantages given the relationship between FFTs, other businesses, and their workforces. This subassignment of error is therefore sustained, in part.
Under CP Policy 9.30, CP Policy 9.32, and CP Goal 9.G, the city generally must maintain and enhance its multimodal freight transportation system. LUBA agrees with the city that these provisions apply only to infrastructure over which the city has planning responsibility (i.e., design and investment decisions in the city’s Freight Master plan) and that the amendments maintain the city’s role as a multimodal hub by allowing FFTs to continue to operate and enhance their non-storage components, regardless of whether those opportunities are realized. However, the city also concluded that, because existing petroleum storage is adequate to accommodate projected growth in demand, the amendments would not result in a change in transportation mode potentially impacting the multimodal system. Because the Oregon Freight Plan recognizes that constriction in one component of an intermodal system (i.e., FFTs) may shift demand to other transportation modes (i.e., truck traffic), and because the city’s conclusion that there is adequate natural gas storage does not have an adequate factual base, LUBA agrees with petitioners that the city’s conclusion that the amendments will not impact the multimodal system does not have an adequate factual base either. This subassignment of error is therefore sustained.
Because many of the existing FFTs are in the Guilds Lake Industrial Sanctuary (GLIS), the Guilds Lake Industrial Sanctuary Plan (GLISP) applies to the amendments. Under GLISP Policy 2, Objective 1, the city must “[m]aintain, protect, and enhance the public and private multimodal transportation investments in the GLIS, including rail and marine terminal facilities, to ensure its continued viability as a major center for the import and export of industrial products in the state of Oregon.” The city concluded the amendments are consistent with this objective because the purpose of the GLISP is to protect the sanctuary from encroachment, the amendments apply to only one type of business, and FFTs will still be able to invest in their multimodal components. Once again, LUBA agrees with petitioners that the city erred in failing to address the role of FFTs in serving other businesses in the area. In addition, LUBA agrees with petitioners that, while the purpose of the GLISP is relevant context, it cannot overrule the plain language of the objective. Because the city did not address whether the amendments will actually enhance private multimodal investments, such as by expanding existing FFTs or establishing new ones, or address whether the amendments will adversely impact the GLIS’ continued viability, LUBA agrees with petitioners that the city council’s findings are inadequate. This subassignment of error is therefore sustained, in part.
Under Goal 2, land use plans must include evaluation of alternative courses of action. LUBA has held that the directive to consider alternatives is a very general one that it is satisfied where the local government adopted findings explaining why it disagreed with the alternatives, set forth a rationale for the choices it made, and specifically responded to particular objections and alternatives raised. Petitioners argue the city’s failure to earnestly consider and adopt legislation from the range of available alternatives—specifically the planning commission’s recommendation to allow a 10% expansion of existing FFTs—violates Goal 2. Because the city council did consider the expansion option, explained that its reason for not including it was because FFTs pose considerable risks in the event of a major earthquake, and simply rejected petitioners’ argument that allowing expansion would increase seismic upgrades, LUBA concludes the city met its burden to consider alternatives. This subassignment of error is therefore denied.
In the fourth assignment of error, petitioners argue the amendments violate the Dormant Commerce Clause. The city responds that, because petitioners raised and LUBA resolved this issue in a prior appeal of similar amendments, issue preclusion applies. LUBA has held that issue preclusion applies only when, in relevant part, the party sought to be precluded was a party or was in privity with a party to the prior appeal. Although all of the petitioners in this appeal are represented by the same attorney as all of the petitioners in the prior appeal, because one of the petitioners themselves was neither a party nor in privity with a party to the prior appeal, LUBA concludes issue preclusion does not apply. In turn, because the prior appeal established that the amendments do not facially discriminate between in-state and out-of-state economic interests; because petitioners identify no similarly situated in-state and out-of-state competitors between which the amendments allegedly distinguish; and because petitioners have not established that any burden on interstate commerce (i.e., moving to truck and other non-pipe and terminal-based methods) is clearly excessive compared to the putative local benefits (i.e., reducing risk in the event of an earthquake), LUBA concludes the amendments do not violate the Dormant Commerce Clause. The fourth assignment of error is denied, and the city’s decision is REMANDED.