[ Council Communication ]  [ Proposed Ordinance ]  [ Letter from Attorney Jerome Lidz ]

JEROME LIDZ
Admitted in Oregon
jerome.s.lidz@harrang.com

VIA FACSIMILE (541) 488-5311
AND FIRST CLASS MAIL

April 10, 2002

Paul Nolte, City Attorney
City of Ashland
20 East Main Street
Ashland, Oregon 97520

Re: City of Ashland Mobile Home Park Conversion Ordinance

Dear Paul:

At your request, this letter reviews Ashland's proposed Mobile Home Park Conversion Ordinance and evaluates the two primary legal challenges presented in Jeff Condit's letter of March 18, 2002, to the Mayor and Council on behalf of HMC Three LLC (HMC).

1. Is Ashland's Mobile Home Park Conversion Ordinance preempted by state law?

Brief Answer: Generally, No. In their application, several provisions in the proposed ordinance may conflict with state law, but the conflicts could be avoided by relatively minor amendments to the proposed ordinance.

2. Does the proposed ordinance constitute a land use regulation that is not effective until it has undergone cost-acknowledgment review?

Brief Answer: No, unless it establishes standards for implementing a comprehensive plan. Nothing in the materials we have reviewed indicates that it does.

Background

The council will be considering a Mobile Home Park Conversion Ordinance that will make a number of additions to the state-required process for a park owner to terminate rental agreements when the park is closed or converted to another use. The most significant provisions are a requirement that owners provide a 90-day notice, a survey of available spaces and a tenant assistance plan, and a requirement that owners provide up to $5,000 either to assist in relocation or to purchase a tenant's mobile home when it cannot be moved. The ordinance also requires a public hearing. Compliance with the conversion ordinance is a condition of park closure or conversion of the park to another use.

Preemption

HMC contends that the proposed ordinance would be void because it is preempted by state statute. Specifically, HMC argues that ORS 90.115 expressly preempts the ordinance in its entirety and that other provisions of the ordinance are preempted because they conflict with various sections of ORS Chapter 90. Express preemption by ORS 90.115.  Whether a local ordinance is preempted by state statute depends on what the legislature intended. Ashland DrtTling, Inc. v. Jackson County, 168 Or App 624, 634, 4 P3d 748 (2000). Preemption can occur when the legislative intent is express or "clearly manifested" in the statute's language. Id. If dear intent is found, that is the end of the inquiry. Examples of express preemption language include ORS 731.840(4) (providing that "It]he State of Oregon hereby preempts the field" of taxing and regulating insurers), ORS 537.769 ("No ordinance, order or regulation shall be adopted by a local govemment to regulate" certain activities, in Oregon Ground Water Act), and ORS 471.045 (the state's Liquor Control Act "shall be paramount and superior to and shall fully replace and supersede any and all municipal charter enactments or local ordinances inconsistent with it."). See, City of Portland v. Sunseri, 66 Or App 261,265, 673 P2d 1369 (1983) (concerning Liquor Control Act); Ashland Drilling, 168 Or App at 637 (concerning the Ground Water Act).

In civil matters, the court presumes that the legislature did not intend to displace local regulation of local conditions unless it has made that intent apparent. City of La Grande v. Public Employes Retirement Board, 281 Or 137, 148-49, 576 P2d 1204, aff'd on rehearing 284 Or 173,586 P2d 765 (1978). See also, Denton Plastics, Inc. v. City of Portland, 105 Or App 302, 306, 804 P2d 1199, 19_01 (1991) ("When the substance of the two laws is civil and they do not conflict on their faces, there is a presumption against preemption, unless there is clear legislative intent" that the state statutes be exclusive); City of Portland v. Jackson, 316 Or 143, 149, 850 P2d 1093, 1096 (1993). The courtis reluctant to interpret ambiguous language as expressly preempting local regulation. Haley, 281Or at 211.¹

In this case, HMC contends that ORS 90.115 expressly preempts the ordinance. We disagree. The language of ORS 90.115 provides that Chapter 90 (Oregon Residential Landlord and Tenant Act) "applies to, regulates and determines rights, obligations and remedies under a rental agreement, wherever made, for a dwelling unit located within this state." This provision does not clearly indicate a legislative intent to prohibit any local regulation of the landlord-tenant relationship. Instead, the statute merely indicates the subject matter, purpose and scope of the ORLTA. There is no language of express preemption similar to that used in the three examples cited above: It does not state that local regulation of rental agreements is prohibited or preempted, and it does not state that Chapter 90 is the exclusive means of regulating residential landlord-tenant relations.

This conclusion is bolstered by the language of administrative rules adopted by the Oregon Housing and Community Services Department. OAR 813-008-0015 requires that termination notices to mobile home park tenants include a "description of any city ... regulations, laws or ordinances which apply to tenant interests in facility closures." The fact that the agency charged with implementing Chapter 90 recognized the possibility of local regulation of facility closures indicates that the statute does not expressly preempt such regulation.

Conflict preemption.

If the statutory language shows no express intent to preempt, it becomes necessary to examine whether the ordinance and the statute conflict or are inconsistent. Ashland Drilling, 168 Or App at 635. Inconsistency between state and local laws can be shown where both laws cannot operate concurrently, or where the legislature meant the statute to be exclusive. La Grande, 281 Or at 148. Inconsistency or conflict involves more than mere differences in the two laws; instead, the. ordinance must either prohibit what the statute permits, or permit what the statute prohibits. Ashland Drilling, 168 Or App at 635. A local ordinance that provides more stringent standards than the state statute is not incompatible unless the statute indicates otherwise. See, Oregon Restaurant Assoc. v. City of Corvallis, 166 Or App 506, 510-11,999 P2d 518 (2000) (ORA) (holding that the city could restrict smoking to a greater extent than the state), State ex rel Haley v. City of Troutdale, 281 Or 203, 211, 576 P2d 1238 (1978) (holding that the city could impose more stringent building standards than the state).

In this case, HMC contends that several provisions of the ordinance are inconsistent with, and therefore preempted by, the ORLTA. ORS 90.630 sets out several requirements for landlords wishing to terminate rental agreements in mobile home parks. ORS 90.630(5)(a) requires at least 365 days notice of termination when a mobile home facility is being closed. The landlord has the option of providing 180 days notice if the landlord finds an acceptable replacement space for each tenant and pays up to $3,500 toward the cost of moving and set-up. ORS 90.630(5)(b). The landlord also has the option of bargaining with tenants for a notice period of less than 180 days by providing "greater financial incentive" to tenants or by contracting for relocation arrangements. ORS 90.630(6). A tenant association has the right to be notified of any offer or listing agreement so that it can negotiate to purchase the park. ORS 90.760; ORS 90.800 to 90.840.

HMC contends that the following five provisions of Ashland's ordinance are inconsistent with the statutes described above: (1) owner's duty to notify city and tenants 90 days before conversion; (2) owner's duty to provide a report of available spaces to the city and to update the report every two months; (3) owner's duty to provide a tenant assistance plan that shows the location of two available spaces and estimated relocation costs; (4) owner's duty to provide up to $5,000 in relocation costs to each tenant regardless of the amount of notice given; and (5) owner's duty to purchase any mobile home that cannot be moved, up to a value $5,000.

(1) 90-Day Notice. Under state law, a tenant is entitled to at least 365 days notice without relocation assistance or 180 days notice with relocation assistance from the landlord. The statutes do not require the park owner to notify a local government of its plans. The City's ordinance requires the landlord to notify the City at least 90 days prior to mobile home park conversion, with copies of that notice to each affected tenant. Sec. 10.114.030(B).

We conclude that the 90-day notice provision does not conflict with state law. Providing 90-day notice to the City does not affect an owner's duty to provide the earlier notice to tenants required by the statute. Instead, it merely requires an owner to keep the City informed. An owner can easily comply with both laws. Thus, there is no conflict.

(2) Report and Survey. Under state law, a landlord who provides 180-day notice must find "space acceptable to the tenant to which the tenant can move." ORS 90.630(5)(b). The statute imposes no similar obligation on landlords who provide 365-daynotice. The City's ordinance would impose greater obligations on the landlord than the state law by requiring the owner, in all cases, to provide to the City and tenants a detailed report of the availability and cost of all spaces within the urban growth boundary. Sec. 10.114.030('B)(1). This report must accompany the 90-day notice described in section (1) above, and the landlord must provide an update to the report every two months.

We conclude that this provision of the ordinance does not conflict with state law. In some respects, it requires an owner to do more that the statute requires, but complying with the ordinance does not interfere with an owner's ability to meet the statute's requirements. The ordinance fits the model of ordinances that provide more stringent regulation than the state and that are not expressly preempted by the statute. See the discussion of ORA and Haley above.

(3) Tenant Assistance Plan. The statute requires a landlord providing 180-day notice to find new space acceptable to each tenant. ORS 90.630(5)(b). The administrative rule requires an owner to provide a tenant with notice of alternate available space at least 45 days prior to the 180-day notice so that the tenant can determine and notify the owner whether the space is acceptable. OAR 813-008-0020. The City's ordinance would require an owner to provide an individual assistance plan to each tenant, showing expected relocation costs and the location of two comparable replacement spaces. Sec. 10.114.030(B)(2). This plan would accompany the copy of the 90-day notice provided to each tenant.

The ordinance does not make compliance with the statute and rule impossible, but it would, in some cases, create unnecessary duplication. The administrative rule requires the owner, 225 days prior to a 180-day closure, to notify the tenant of alternate space, and the tenant has 20 days to decide if that space is acceptable. If the tenant accepts the space, the landlord then can provide 180-day notice. Under the City's ordinance, the owner subsequently would be required to provide the tenant with a tenant assistance plan identifying alternative space regardless of whether the owner and tenant have already agreed on an acceptable space. If the owner has complied with the statute's 180-day notice requirement and has secured an acceptable space according to the terms of the rule, the ordinance's tenant assistance plan would be superfluous. In such cases, the tenant's relocation is already settled, even if the move has not yet occurred.

Another section of the statute allows a landlord to provide additional compensation to tenants for a shorter notice period, or to contract with a tenant for an agreeable solution. ORS 90.630(6). If the notice period in such a case is less than 90 days, or if the tenant is still in residence at the 90-day mark, the terms of the ordinance would still require the tenant assistance plan and relocation costs to be applied, in addition to the terms of the agreement between the tenant and landlord. While the ordinance would not prevent application of ORS 90.630(6), it would undermine its purpose and is arguably inconsistent.

An owner who opts for the 365-day notice would have no obligation under state law to locate alternate space or pay for relocation costs. ORS 90.630(5)(a). However, under the ordinance, the owner would, at 90 days before closing, be required to provide a tenant assistance plan to all tenants who remain, regardless of whether they have already made arrangements to move.

We conclude that the tenant assistance plan portion of the ordinance does not conflict directly with, and is not preempted by, either the 180-day or 365-day provision of state law. However, it arguably docs conflict with ORS 90.630(6). We recommend that the provision be amended to make it clear that it does not apply to tenants who have reached agreement with the owner on relocation or have already secured alternate space. We also recommend that it be amended to provide that, in combination with the statute, it does not require the total relocation costs paid to exceed $5,000 in any case.

(4) Relocation Costs. State law requires a landlord to provide up to $3,500 in relocation costs to all tenants receiving 180-day notice. ORS 90.630(5)(b). The administrative rule provides that the landlord must pay these costs upon submission of bills or receipts by the tenant. OAR 813- 008-0030. The City's ordinance requires a landlord to provide up to $5,000 to all tenants receiving a tenant assistance plan with the 90-day notice. Sec. 10.114.030(D). The ordinance does not prescribe any particular method for payment of these costs.

Although the timing and mount of payment are different under each law, the laws are not contradictory. The ordinance requires the landlord to provide more assistance to tenants who have not relocated by the time of the 90-day notice. It would not require a relocation payment to tenants who received the statutory 365-day notice and who have relocated before a 90-day notice is filed with the city. We conclude that there is no preemption of this provision of the ordinance because the ordinance does not interfere with the statutory process. However, the ordinance's structure does allow a tenant to manipulate the system by purposely remaining in residence in order to get the higher payment under the ordinance. To address this contingency, we recommend that the ordinance be mended to provide that a tenant who has accepted alternative space under the 180-day statute and has failed to relocate within 30 days of the space becoming available shall not be eligible for the relocation cost provision under the ordinance.

(5) Purchase of Unmovable Home. State law does not address the circumstance in which a tenant's mobile home is in such a condition that relocation will destroy its usefulness. The City's ordinance requires a landlord, in such a circumstance, to purchase the mobile home for its market value, up to $5,000, in lieu of providing relocation costs. Sec. 10.114.030(D). There is no conflict here because the state has not legislated with regard to unmovable mobile homes. We conclude that this provision is not preempted.

Land Use

HMC argues that because the ordinance requires compliance as a condition precedent to mobile home park conversion, it will have a significant impact on land use and therefore is "arguably" a land use regulation that must undergo the statutory procedures in ORS 197.610 to197.625.

ORS 197.610 provides that a proposal'to amend a land use regulation or adopt a new land use regulation must be reviewed by the DLCD prior to adoption. "Land use regulation" is defined as "any local government zoning ordinance, land division ordinance.., or similar general ordinance establishing standards for implementing a comprehensive plan." ORS 197.015 (11 ). "New land use regulation" is defined as "a land use regulation other than an amendment to an acknowledged land use regulation adopted by a local government that already has a comprehensive plan and land regulations acknowledged under ORS 197.251." ORS 197.015(17).

The City's ordinance is not a zoning or land division ordinance, so the only remaining question is whether it established standards for implementing a comprehensive plan. There is no indication in the mater/als we've been provided that this ordinance concerns implementation of the comprehensive plan.

The "significant impact" test applies only to whether a decision is a "land use decision" for purposes of determining LUBAjurisdiction. See, Oregonians in Action v. Land Conservation and Development Com'n, 103 Or. App. 35, 38, 795 P.2d 1098 (1990) ("The 'significant impact test' wasdevised to supplement the legislative grant of jurisdiction to LUBA, by making some land use actions reviewable that do not meet the statutory definition of a "land use decision."). It does not apply to whether post-acknowledgment review is required.

Because the proposed ordinance is not a land use regulation, it is not necessary to demonstrate compliance with the statewide planning goals or to follow post-acknowledgment amendment procedures.

Other Issues

You did not ask us to address the other issues raised in Mr. Condit's letter, and we have not analyzed them in any depth. To the extent that they relate to the matters discussed above, however, we did form some opinions. Very briefly: We think the required public hearing and landlord's report serve legitimate public purposes. We agree that the definition of "comparable replacement space," as drafted, will be difficult to administer. We do not see any merit to the takings and due process arguments, unless the ordinance, as applied, prevented the owner from ever removing tenants and converting the property to another use; merely making it difficult to do so, as a result of regulation to protect affordable housing, would not have that result.

Conclusion

The proposed ordinance as a whole is not preempted by the ORLTA. Some parts of the ordinance do not mesh well with state statute, however, and that provides a colorable basis to argue that there is a conflict between the specific ordinance requirements and the comparable provisions in state law. Those problems could be resolved by amending the ordinance to describe more precisely how the ordinance intends to supplement the state requirements.

In our opinion, the ordinance is not a land use regulation.

If you would like to discuss any of this in greater detail, please don't hesitate to call either of us.

Sincerely yours,
Jerome Lidz
Karla Alderman

¹ The court also presumes that a local government intended its ordinance to function consistently with the relevant statutes. La Grande, 281 Or at 148.

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