Northwest Land Matters Update - May 2015

May 19, 2015

Seattle’s Affordable Housing “Linkage Fee”: A Renewed Attempt to Impose Mandatory Affordable Housing Requirements

The City of Seattle has struggled for decades with the issue of how to provide sufficient affordable housing. In the 1980s and 1990s, Seattle attempted to discourage the demolition and conversion of existing low-income housing by adopting “Housing Preservation” ordinances that imposed fees or required developers to provide replacement housing. Washington courts rejected these mandatory requirements, ruling they were unauthorized taxes or unconstitutional conditions that placed an unfair burden on individual landowners to solve a “community” problem.

After Seattle’s failed experiment with mandatory affordable housing requirements, the City shifted its focus to voluntary programs. These programs include various land use incentive zoning provisions, first adopted in 2001, that allow additional floor area to developers who provide low-income housing or contribute cash to the City’s low-income housing program, as well as the City’s Multi-Family Property Tax Exemption (MFTE), adopted in 2004. 

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IN BRIEF

Neighborly Accommodation Does Not Put Owners at Risk of Prescriptive Easement Status

Last month, the Supreme Court further clarified Washington’s prescriptive easement case law, by finding that a presumption of permissive use applies to enclosed or developed land when the court can reasonably infer neighborly sufferance or acquiescence, and therefore no prescriptive right may vest. This type of dispute most commonly arises among neighbors when a property owner tries to stop a neighbor’s long-term informal use of a roadway over their private property.  In order to establish a prescriptive right to continued use, the neighbor must establish that their use of the roadway was “adverse” to the landowner.  Prior to the court’s decision, it was unclear whether the neighbor using the street could establish a presumption of adverse use if the landowner was generally aware of the use and did not affirmatively object, or whether the presumption should be one of permissive use. The Court ruled that case law and policy considerations (to avoid landowners adopting “dog-in-the-manger” attitudes simply to protect title to property) supported a presumption of permissive use.

Tiered Water Rates: Unconstitutional in California but What About in Washington?

On April 20, a California appellate court ruled that the City of San Juan Capistrano's tiered water rates, aimed at stimulating efficient water use through economic incentives, are unconstitutional.  The court found that in failing to correlate higher tiered rates to actual costs of providing water service, the City violated a voter-approved law.   Quoting Marc Reisner’s Cadillac Desert, the Court emphasized the importance of conservation to the future of California, but stressed the need to figure out the true cost of water, not simply drawing lines based on water budgets.  Although Washington State does not have the same voter-enacted constraints, the Court’s analysis of the record needed to justify tiered rates could provide valuable guidance to Washington’s municipalities and water districts.

Importance of Clarifying Intent in Purchase/Sale Agreements

The Washington Court of Appeals recently considered a buyer’s remedy for a seller’s breach under a real estate purchase and sale agreement.  In Grant County Port District vs. Washington Tire Corporation, the seller refused to close a sale of real property even after the buyer had satisfied all of the closing conditions.  The seller argued that the buyer’s sole remedy for the seller’s default was the right to rescind the agreement and receive a refund of the earnest money, based on language in the purchase agreement stating that “[i]f Seller refuses to complete the sale then Purchaser shall be entitled to” refund and rescission.  The court disagreed with the seller, holding that the contract language gave the buyer the right to invoke those remedies, but did not make those remedies mandatory or exclusive.  The court considered an “exclusive remedy presumption” from other cases, but found that the language in the agreement, together with an assumption that the parties did not intend to allow the seller to commit a “breach without consequences”, overcame the presumption in this case. Parties to real estate purchase and sale agreements frequently intend for some remedies stated in the agreement to be exclusive, but this case shows the importance of clarifying that intent in the agreement.

After Two Half-Steps, Statewide Drought Declared in Washington  

On May 15, Washington Governor Inslee issued a statewide drought declaration.  Previous drought declarations in March and April had covered about 44% of the land area and focused on watersheds impacted by low snowpack.  Since then, seasonally low rainfall has placed rain-dependent watersheds into drought conditions (defined as less than 75% normal water supply).   As of May 15, statewide snowpack stood at 16% of normal and streamflow at less than 5% of normal, with some rivers and streams reporting the lowest flows on record.  The drought's effects around the state are uneven, with large water utilities such as Seattle reporting full reservoirs and good water supply conditions, which poses challenges for public and customer communications.  The Governor's declaration opens access to emergency drought funds for water supply hardship, provided that the legislature approves the requested funds ($9.5 million) in the special session.  Also, the Department of Ecology issued drought orders for the covered watersheds that allow applications for emergency water right permits (or changes to existing water rights) to alleviate "undue hardship" when other requirements are met.  

Potential Slope Instability Prompts Emergency Rulemaking Power

In a recent opinion requested by Washington Public Lands Commissioner Goldmark, the Washington Attorney General stated that the Forest Practices Board does not have authority, either express or implied, to adopt a moratorium on Forest Practices applications that may pose a threat to public safety due to potential slope instability. The AGO stated that the Board can, however, adopt an emergency rule concerning unstable slopes on the basis of threat to public safety. Noting that the Board has emergency rulemaking power to protect public safety, and rulemaking authority to establish minimum forest practice standards and application designations, the AGO states that the Board could therefore redefine applications in areas of unstable slopes to the most restrictive class of forest practice. That move would subject the applications to SEPA review and possible conditions or denial.

King County Appeals Stormwater Regulation Decision

With Washington’s vesting rights doctrine in flux following the Supreme Court’s Potala Village decision last year, King County and other interested parties appealed the 2013-18 NPDES Phase 1 Municipal Permit, asking the court to confirm that stormwater regulations which apply to a complete and vested land use permit application also vest at the time the complete application is made. Otherwise, Special Condition S5.C5.a.iii will require municipal permittees to apply new stormwater regulations to land use permit applications that have already vested under state vesting laws.  King County’s brief focuses only on land use permits with clear statutory mandates to apply vesting rules: building permits (RCW 19.27.095), plat applications (RCW 58.17.033), and development agreements (RCW 36.70B.170). The court has not yet set oral argument.

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