Council sides with MIP over city staff

The McMinnville City Council went against an interpretation of code by three city attorneys to side with a longtime community partner in a minor partition appeal hearing Wednesday night.

McMinnville Industrial Promotions was approved by staff in December to partition a 26-acre lot at the end of Miller Street with the condition they construct a road, interim storm system and sidewalk, and compel its neighbor to complete its portion of the work.

MIP appealed the ruling, and the city thought an agreement was reached to strike the road, storm system and neighbor agreement. However, MIP argued at the appeal it shouldn’t have to complete a stretch of sidewalk on one side of the street until development occurs on the new 6.8- and 19-acre plots and permits are issued.

Applicants can enroll in a deferral agreement to delay the work using a surety bond, escrow account, cash or line of credit. MIP also objected to that requirement. The planning commission agreed with staff that code mandates the sidewalk construction.

At an appeal hearing before city councilors Wednesday, MIP attorney Kate Gowell argued that city code requiring the same construction improvements for entire subdivisions as a minor partition of a rural industrial property is “nonsensical.” Most of the council agreed and found the requirements shouldn’t apply to minor partitions, despite warnings from staff that the fallout of such a decision is unknown.

The central disagreement between MIP and city staff is an interpretation of the term “subdivider” in city code related to improvement requirements.

The Land Division Standards chapter of city code governs property line adjustments, partitions and subdivisions. Code requires projects to cover costs for items like connections with the city’s water and sewer system and the construction of necessary roads and sidewalks.

The list of requirements for the three types of projects begins with the line: “The following improvements shall be installed at the expense of the subdivider.”

Community Development Director Heather Richards said it’s been the position of three city land use attorneys the definition of subdivider applies to all property divisions, not just subdivisions.

“We don’t have a definition of a subdivider in our code, so when we don’t have a definition of something we have to use the common term for something,” she said. “The common term (for subdivider) is for the division of land. And because this section isn’t under the subdivision section of code, it’s been legally interpreted that this section applies to all land divisions.”

Gowell argued the term subdivider applies specifically to subdivisions, just as the term partitioner refers to partition cases.

“If this was not to be defined and we’re not using words with specificity, then why do we have these different names and uses depending on what part of the code we’re talking about?” she asked.

The city formerly allowed deferral agreements without bonds. Requiring sidewalks prior to platting makes sense for a subdivision with dozens of homes, but not an isolated industrial parcel, Gowell argued. Sidewalks would likely have to be redesigned and rebuilt when development eventually occurs, she added.

“This is a sidewalk that starts from nowhere and will go to nowhere,” she said. “There’s no connectivity, and I just don’t feel that people are going to be walking or using those sidewalks in the industrial park.”

Construction of the sidewalks would cost up to $50,000, and a prior deferral agreement with the city resulted in “significant costs” to MIP, Gowell said. Building the sidewalks would be a “waste of time and money,” while bond carrying costs could also rack up a large price tag.

“MIPs already held this vacant land for two decades,” she said. “I think that it is reasonable and likely that it will be another at least five or 10 years before any real development or anything occurs on it.”

The city policy results in only developers with deep pockets being able to pursue projects, Gowell said, giving examples of recent clients who backed out of property adjustments and partitions because of the rules.

“Either they have not moved forward with an application (or) they’ve abandoned planned partitioning altogether due to the expense involved with complying with these unreasonable improvement requirements,” she said.

The city has required the construction of sidewalks prior to platting as a condition of approval for at least the last 15 years, Richards said. However, it has not held applicants to the rules of deferral agreements until more recently.

“What (staff) haven’t done is require conditions of approval be achieved before recording of final plat,” Richards acknowledged. “So, we haven’t required that that particular improvement either be built or deferred with a deferment agreement prior to signing off on the ability to record the final plat. Historically, we’ve ignored that process.”

Richards (and contracted legal counsel Missy Ryan) agreed the code has problems and said the discrepancy could be revisited during an upcoming project to update code to reflect legislative changes.

Richards offered a deferral agreement that essentially would be a letter from a local bank guaranteeing funds are available. She said MIP would have been eligible for a variance for the work, but Gowell held firm that the code shouldn’t apply to their project.

“We felt that this portion of the code did not apply to partitions and therefore a variance wasn’t needed,” Gowell said.

Variances acknowledge code applies and ask for an alternative, she said. “In this particular case it’s just not applicable.”

The situation became more complicated as the night progressed. Mayor Kim Morris recused herself from voting after her husband Mike Morris testified in support of MIP. The mayor remained at the dais throughout the deliberations but didn’t weigh in. Morris casts a vote only in the event of a tie.

A decision timeline also added to the confusion. Under state law, the city has 120 days to make a ruling on a land use decision, unless an extension is requested by the applicant. Changing the staff recommendation could surpass the timeline and lead to the Land Use Board of Appeals automatically siding with MIP.

“With the deadline bearing down on us, I’m not sure that the council’s going to have time to adopt findings in support of its decision,” Ryan said.

However, Gowell agreed to extend the timeline after Councilor Chris Chenoweth made a motion siding with MIP.

After a lengthy discussion and variety of outside the box suggestions from councilors (including striking sections of code at the meeting), Chenoweth motioned to strike the sidewalk requirement on the basis that the code doesn’t apply to minor partitions.

Richards and Public Works Director Geoff Hunsaker repeatedly cautioned the council that that would prevent the city from requiring other improvements at time of platting because of how the code is written.

“If the definition is that those menu list of improvements can only be applied to subdivision if it says subdivision in the improvement language, then we don’t have (the) opportunity to require water, sewer, electricity, streets — only pedestrian ways and street trees,” Richards said.

The other requirements are largely required to be completed by the time of permitting through other sections of code; however, some aspects, such as street tree requirements, may be left out, according to Hunsaker.

“I’d have to individually look at each title to see if the triggers are met; and so they likely will (be), but it’s going to be a lot of pieces I’m putting together and it’s not going to apply perfectly to everything because those other titles aren’t written with this in mind,” he said.

Attempting to seek clarity, Council President Sal Peralta restated the possible effects of Chenoweth’s motion, asking if other improvements will be covered by the time of development. Staff reiterated more research is needed to identify the full impacts of the decision.

“If you’re asking me to verify that’s exactly what’s going to happen, I’m not going to state that tonight,” Hunsaker said. “I haven’t read all the code. If you want to make some assumptions as the council, you are welcome to do that, but as staff I’m going to reserve the right to say I don’t know and I’d have to look that up.”

The council approved striking the sidewalk requirement by a 4-1 vote, with Councilor Zack Geary opposed. Because the vote wasn’t unanimous, a second reading will be held at council’s May 12 meeting.