A ruling this week by the Oregon Land Use Board of Appeals that overturned a citizen-approved ballot measure phasing out vacation rentals in unincorporated Lincoln County returns the issue’s focus from Salem back to the courthouse in Newport.
On Thursday, there is a circuit court hearing whether to consolidate challenges to a separate county vacation rental ordinance and its moratorium on issuing new licenses.
The moratorium expires Sept. 6, so county commissioners must also decide before then whether to extend it again or let it lapse. Since the moratorium was first enacted in 2020, the number of licenses has dropped from more than 600 to 511.
But the moratorium decision could also be complicated by a secondary ruling from LUBA — that the county’s longtime ban on transfer of vacation rental licenses to a property’s new owner also violates Oregon law.
County commissioners and the group that put Measure 21-203 on the November 2021 ballot must decide within 21 days whether to appeal LUBA’s ruling or to focus on defending the county’s ordinance in Lincoln County circuit court.
The LUBA and court cases are being closely watched around Oregon as other groups and jurisdictions wrestle with how – or if – to regulate the growing number of vacation rentals in popular tourist areas.
Although statements made last week’s ruling still contained aggressive language, the lodging group formed to fight the ballot measure and the neighborhood coalition that sponsored it both seemed to indicate they hope county commissioners could help work out some sort of compromise. But it is unclear whether the lodging group ViaOregon or the 15neighborhoods coalition would accept a negotiated cap on licenses rather than an outright ban, and other restrictions.
The alternative is to continue the fight in court — which has already involved hundreds of thousands of dollar in legal costs for the county, ViaOregon and 15neighborhoods.
After Monday’s ruling, the lodging group said: “ViaOregon hopes that this decision will lead to common-sense regulation. We hope the decision will clear the way for the county to accept our help instead of continuing to waste taxpayer money on the bad idea of banning vacation rentals.”
The neighborhood coalition had this to say: “15neighborhoods is like the archer who misses their mark, stops, corrects themselves, and shoots again. As we discuss next steps and how we can take our neighborhoods back, just know we will not give up. As intervenors, we will continue to work with Lincoln County to ensure that the voices of 10,080 residents who voted to phase out STRs, will not be silenced. We trust that the Board of Commissioners has heard you loud and clear. Please, continue to be patient as we try to work with the county on making things right for all of us. Technicalities do not mean the message or the intent was wrong.”
It may be Wednesday before county commissioners make their direction clearer. As of Thursday, its staff response was “no comment.” But commission chair Claire Hall met Thursday with the county’s attorneys to get briefed on LUBA’s decision and discuss implications and alternatives.
“I’m going to ask that this be added to next week’s commission agenda so we can have an open discussion and hopefully reach consensus on next steps,” Hall said in an email to YachatsNews.
It’s a complicated legal process involving multiple court cases for the county, ViaOregon and 15neighborhoods. Here’s a breakdown of issues:
Ballot Measure 21-203:
The measure made the Lincoln County ballot after the neighborhood coalition grew frustrated with the county’s stop-and-go efforts to regulate vacation rentals in unincorporated neighborhoods. They collected enough signatures to get their proposal on last November’s ballot, where it passed easily — 58 to 42 percent — after an expensive and bitter campaign.
The measure phased out short-term rentals in residentially-zoned areas of unincorporated Lincoln County. It also lowered occupancy limits and required regular septic inspections and improvements. The measure did not apply to vacation rentals inside cities, most of which have their own limits and regulations.
The ballot measure was immediately challenged in Lincoln County circuit court, but a judge ruled in March that the measure was a land-use issue and sent the dispute to LUBA.
In its ruling Monday, LUBA said the ballot measure conflicted with Oregon land-use law. The measure called short-term rentals in residential zones non-conforming uses and be phased out over five years. LUBA, a state quasi-judicial body that decides legal issues involving land use, determine that Oregon law (ORS.215.130) allows non-conforming uses to continue — that such uses cannot be changed retroactively at the local level if there is a conflict with state law.
In a second major element of its ruling, LUBA said a separate county ordinance that prevents transfer of a vacation rental license when a property is sold or changes owners also conflicts with the same law.
“We agree with petitioners that BM 21-203 violates ORS 215.130(5) by requiring STRs in the identified zones to cease within five years and by prohibiting their transfer of ownership,” the agency said. “ORS 215.130(5) prohibits the county from requiring lawful STRs that are nonconforming uses to cease in five years or prohibiting the transfer of their ownership.”
County Ordinance 523:
Commissioners passed Ordinance 523 six days before last November’s vote in an attempt to sway voters to reject the ballot measure, which they argued was too severe and susceptible to legal challenges. That ordinance did not phase out vacation rentals, but created five “zones” west of U.S. Highway 101 and limits the number of licenses in each area. It limits occupancy – not as much as BM 21-203 – but has similar septic rules.
Commissioners passed their ordinance as a business license regulation, not a zoning issue. ViaOregon challenged the ordinance in circuit court, saying it was a land-use decision and got it moved to LUBA. But LUBA later disagreed, saying it was not a land-use decision and sent it back to circuit court.
License moratorium:
At the direction of county commissioners, the Lincoln County Sheriff’s Office stopped issuing vacation rental licenses more than two years ago as the county wrestled with the vacation rental issue. Commissioners kept extending the moratorium but after voters approved the ballot measure agreed late last November to let it lapse.
When a judge put the ballot measure on hold, commissioners quickly renewed their moratorium Dec. 3, 2021, and made it retroactive to Nov. 30. But during that window, 9-10 people sought to get licenses and were denied.
In February, commissioners extended their license moratorium until Sept. 6.
The court hearing Thursday is to consider a request by ViaOregon to consolidate its challenges to county Ordinance 523 and the license moratorium into a single case. Lawyers for 15neighborhoods will ask the judge to intervene and oppose that request.
- Quinton Smith, a longtime Oregon journalist, is the founder and editor of YachatsNews.com and can be reached at YachatsNews@gmail.com