On December 30, 2020, the Oregon Court of Appeals released its first decision interpreting statutory provisions governing prospective Measure 49 claims. The question in Moore v. City of Eugene, 308 Or App 318  (2020) is whether a residential dwelling size restriction adopted and applied after petitioner purchased her property entitled her to Measure 49 protection. The court held that it did not, because the size restriction did not restrict the residential use of the property.

Measure 49 was a statewide ballot measure passed in 2007 that provided landowners with relief from land use regulations that restricted the use of their property when those land use regulations were enacted after the landowner had purchased the property. The main thrust of Measure 49, at least initially, was to allow owners of resource land to construct houses on the affected property if the property owner had owned the land prior to the residential use restrictions. A separate facet of Measure 49, however, allowed property owners relief from any post-purchase land use regulation as long as that regulation met a number of requirements. As pertinent here, the challenged regulation must be a “land use regulation,” the desired property use must be residential or a farm or forest practice, and the regulation must restrict the claimant’s desired use of the property.

Petitioner purchased her property before the City of Eugene adopted an ordinance limiting the size of dwelling units on lots like hers to ten percent of the total lot area. Prior to the limitation, petitioner could have built a 1200 square-foot house. After the limitation, petitioner could only build a 462 square-foot house. The Eugene City Council denied petitioner’s Measure 49 claim for compensation for the reduced fair market value of her lot or waiver of the regulation, because it concluded that the ordinance did not restrict the residential use of the property – just the size of the residence allowed. The trial court upheld the City’s decision on the basis that the challenged provision was not a land use regulation within the meaning of Measure 49, because it did not restrict the residential use of the property. The trial court read the Measure 49 requirement that the regulation must restrict the claimant’s desired use of the property to mean that the regulation must actually prohibit the residential use of the property.

The court of appeals relied on the context of the term “restriction” in the Measure 49 statutory scheme, as well as analysis in other Measure 49 cases relating to non-prospective claims, to define the “use” of the property as a broad categorical level of use. In other words, to qualify the regulation must restrict the actual employment of the land for, as relevant here, a residential purpose. The City’s size restriction did not restrict the actual employment of the land for a residential purpose. Petitioner could still build a house on her property, albeit a smaller one. The size restriction is a siting and development standard, not a use restriction. Therefore, petitioner was entitled to no relief under Measure 49.