Wednesday, May 2, 2012

Alternative Approaches to Land Use Entitlement

In my last post, I spoke of the “fog of war” that can descend over a land use entitlement process.  I then proposed three community actions that can help provide some clarity through the fog.

To be fair, I should note that developers could also help by being clear about what they can afford to include in their project.  However, developers typically don’t have firm data about project finances until construction bids are received and construction financing is secured, both of which occur well after entitlements are received.  Thus, the nature of land development makes a lack of clarity more understandable on the part of developers.

But there is another question to be asked.  Is the entitlement process itself causing some of the fog?

Human beings have a tendency to bond to our first interaction, regardless of the activity.  I still follow the baseball team that was local club when I first became aware of the game.  When I was young, my father pasted a decal of his alma mater on my toy box.  I eventually went to the same university and still have season tickets to their football games.  And I won’t touch the religious and political predilections that we absorb from our early family surroundings.

I suspect the same tendency applies to land use entitlement.  If one’s first exposure to an entitlement process comes in California, one moves through life thinking that the California process is the way land entitlements should be.   Even if one grumbles about the details of the Land Map Act or CEQA, one sees those flaws as only warts on the process, not as a fundamental indictment of the process.

My first exposure to land use entitlement wasn’t in California.  It was in Oregon.  However, in Oregon the phrase would be land use “permitting.  In fact, the first time I ever heard the term “entitlement” was when I met with a California developer who was considering an Oregon project.

Not surprisingly, I can see a lot of good aspects to how entitlements are processed in Oregon.  I find it the cleaner approach.  But I can also be fair and admit that California has at least two entitlement features that are better than Oregon.

 (I actually spent the first decade of my career in hydroelectric energy, which is primarily a federal licensing system under the Federal Energy Regulatory Commission.  However, I’m absolutely not bonded to the FERC approach to entitlement.  We needn’t mention that process any further.)

There are two points of the entitlement process on which I think the advantage goes to Oregon.  First, there is no CEQA equivalent in Oregon.  (CEQA is the California Environmental Quality Act.  Although perhaps not intended by the drafters, many of the processing standards established by CEQA effectively constrain local land use processes.)  I think environmental protection has been a major achievement of our lifetime.  Our environmental attitudes and successes have moved upwards dramatically.  But CEQA, both through the constraints it imposes on local processes and through the option to project opponents to move a contested entitlement process into a slow-moving court system, interferes with timely land use decisions.

In the absence of a CEQA-equivalent, environmental protection in Oregon is incorporated into the land use standards.  If a project opponent feels that environment impacts haven’t been adequately addressed in the local process, the option remains to take the project to court, but only after all appeal options at city hall have been exhausted.  In practice, most issues are resolved in the hearing or the initial appeals and the courts are used less frequently than in California.

Second, Oregon land use hearings aren’t conducted in front of planning commissions or city councils.  Instead, the hearings are conducted by a hearings officer.  Only if an appeal is pursued does the matter proceed to a planning commission or city council.

The hearings officer is often a local attorney who has experience in land use.  The hearings officer conducts the hearing with almost a court room demeanor.  Not having to worry about future re-election or re-appointment, hearing officers typically run hearings with a strong hand, requiring that commenters not repeat previous comments and strictly enforcing time limits.

Most importantly, the primary task of the hearing officer is to objectively determine whether the proposal conforms to the governing local standards.   There are fewer political aspects to a hearing.

I was the engineering manager for an Oregon project that eventually encompassed 600 acres and 900 homes.  In a decade of managing the project through the initial entitlement and more than a dozen master plan revisions, the project never appeared before the planning commission or the city council.  At every step, the entitlements were handled either by staff or by a hearing officer.  The process was conducted so well that the opponents were never motivated to pursue an appeal.

When the entitlement process began, I was the primary local member of the project team.  I began building relationships with the planning and public works staffs and was able to coordinate the initial entitlement.  Prior to construction, the developer installed a local president, who thanked me for my work and advised me that he would now be handling entitlements.  He assumed that he could build relationships with the city council which would provide the connections he needed.  It took him awhile to realize that it was my connections with city staff that were the keys to continuing entitlements.  It was a very different world from California.

With those two points made for Oregon, I also must acknowledge two aspects on which I prefer the California approach.  First, because the hearing decision is written by the judge-like hearing officer after the hearing, the conditions of approval are not available for review by the developer prior to issuance.  In California, the proposed conditions of approvals are usually offered by city staff prior to the hearing and can be discussed during the hearing.

In the Oregon project I introduced above, the hearing officer misunderstood a key calculation in the application.  Furthermore, he applied a flawed solution to remedy the situation.  To meet the approaching construction season, the developer chose not to appeal the decision and instead modified the project to conform to the conditions of approval.  However, the changes were significant and affected market acceptance.  If the development team had been allowed to review the conditions of approval, the errors could have been remedied.  Years later, I spoke informally with the hearing officer.  After I explained the two situations, he agreed that he’d been in error on both.

Second, because the hearing officer is a rather Olympian figure, absolutely no communication is permitted in advance of an Oregon land use hearing.  In California, the rules are somewhat less absolute and there may be opportunities to casually review a proposal with a planning commissioner or a city council member before a hearing.  I’m certainly not supportive of undue influence, but ensuring that a project is properly understood in the context of the community and the land development standards would avoid the problem I described in the previous paragraph.

If I had to pick either the Oregon or the California system of entitlement, I’d pick Oregon.  But even better would be to incorporate the better aspects of both.  The quality of our eventual land uses could be affected, which we should take seriously.  Also, urbanist projects tend to be the more complex land use entitlements.  Therefore, having the best possible process is increasingly important.

As always, your questions or comments will be appreciated.  Please comment below or email me.  And thanks for reading. - Dave Alden (

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