Legal tussle delays senior-living project

A legal tussle involving two potential senior-living projects in Sisters has gone through a land-use appeal.

The State Land Use Board of Appeals (LUBA) has issued its final opinions and orders regarding two appeals filed with them by Pinnacle Alliance Group, LLC, whose president is Mark Adolf, developer of a proposed assisted-living facility in Sisters.

The appeals are regarding decisions made by the City of Sisters, the Sisters Planning Commission, and the City Council regarding McKenzie Meadow Village (MMV), a multi-phase mixed-used development, including an assisted-living facility.

The grounds for the appeals have mainly to do with procedural errors and omissions, differences of opinion or interpretation, and missing documentation. The two appeals involved five attorneys in three law firms, three LUBA board members, untold hours of City staff time, and continued delays in the start of construction at McKenzie Meadow Village. The accompanying record of all relevant materials is 1,666 pages long.

One petition - which was dismissed by LUBA - asserted that Pinnacle was adversely affected by the City's community development director administratively extending the MMV Master Plan approval without a hearing.

The City contended, and LUBA agreed, that the extension was simply a reauthorization of the original master plan uses approved in 2010 and 2012. Oregon statute requires that Pinnacle show how the uses authorized by the extended master plan adversely affected its interests.

LUBA concluded that Pinnacle's brief only asserts that its interests will be impacted, with no explanation as to how or why. The brief contends that MMV will generate traffic impacts that will affect the petitioner's nearby property, which in fact is over a mile away from the McKinney Butte Drive location of MMV, next to the post office.

LUBA rejected Pinnacle's undeveloped claim that MMV may use the same city road and water system as Pinnacle, as insufficient to demonstrate that MMV's extended master plan will adversely affect Pinnacle.

Finally, Pinnacle's undeveloped assertions that the decision will have "economic impacts" and "violates petitioner's due process and equal-protection rights" also lack sufficient detail to demonstrate an adverse effect for purposes of establishing standing under Oregon law.

The conclusion reached by LUBA is that Pinnacle didn't establish it had standing to bring the appeal; therefore, it was dismissed. Pinnacle is entitled to judicial review of the order and could take it to the Court of Appeals.

The second appeal is much more complex, consisting of four assignments of error, one of which has three sub-assignments. The appeal concerns approval of a new site plan and modification of the original master plan for the MMV senior-living facility.

On June 18, 2015, the Planning Commission approved the new site plan and modification of the original master plan for the MMV senior-living facility. During that public hearing, Pinnacle's attorney requested that the hearing remain open to allow time for submission of more materials for the Planning Commission's consideration.

Planning Commission Chairman David Gentry closed the hearing. That was an error.

City Attorney Steve Bryant had not been asked to attend that evening's meeting, so was not there to avoid that error being made, which provided grounds for Pinnacle to appeal the decision to the Sisters City Council.

In August 2015, City Council held a de novo (new) public hearing at which Pinnacle was permitted to submit additional evidence, which adequately ensured that their rights to a full and fair hearing were not prejudiced. Council upheld the Planning Commission's decision. LUBA concluded that the Planning Commission's procedural error outlined in the first assignment of error provides no basis for reversal or remand under Oregon statute, since Pinnacle was able to receive a fair hearing in front of City Council. That assignment was dismissed.

In a second assignment of error - which was sustained by LUBA - Pinnacle contends that the two-page City Council decision from August 2015 is not supported by adequate findings. LUBA's rules require that the record include "the final decision including any findings of fact and conclusion of law."

The City Council decision said, "The findings of fact in this matter are located in the staff report, incorporated herein as Exhibit A."

No staff report was attached to the Council decision. It is clear from the quoted language in the City Council's decision that they meant to adopt a staff report as the findings to support its decision - but which one? There are two possibilities and neither is labeled "Exhibit A" or attached to or close to the two-page Council decision.

The staff report to the Planning Commission is the only one that comprehensively attempts to address applicable approval criteria. But the report to the City Council is the only one that addresses issues raised in Pinnacle's appeal of the Planning Commission decision to the City Council.

LUBA concluded that City Council didn't adequately identify which staff report it intended to incorporate as findings. Either choice presents benefits and problems. LUBA can't overlook "a City Council total failure to adequately identify any findings in a case that presents the factual and legal complexities presented in this appeal. "

LUBA suggests that City Council may want to consider adopting supplemental findings to further address the issues raised in the third and fourth assignments of error.

Because LUBA sustained the second assignment of error, they remanded the entire appeal so that Council can more clearly identify the findings it intended to adopt. That remand made it unnecessary for LUBA to address Pinnacle's other two assignments of error. However, they did discuss the third and fourth assignments to help clarify some of the issues Council may need to address on remand.

The third assignment of error asserts that the City should have required a new impact study be done by MMV to support the master plan modification. MMV and the City contend it isn't necessary because the modification replaces a larger facility with a smaller facility. LUBA suggests that MMV's argument would be stronger if there were some expert testimony. The 2010 impact study should also be included in the record.

Pinnacle also contends that the City erred by failing to approve the proposed modification as a major modification. In fact, the 2015 modified master plan was reviewed and approved as a major modification.

The final contention is that the MMV major modification proposal is instead "a substantially new proposal," which City staff concluded is not the case. However, staff provided no explanation for their conclusion. LUBA agrees with staff, but recommends the City adopt findings that explain their position, along with any interpretations of relevant development criteria they believe are appropriate.

The fourth assignment of error has to do with the May 2010 amended annexation agreement which stated that the senior-living center, or a phase of it, must be constructed as part of Phase 1 of the subdivision and receive occupancy permits before any other building can begin. It also specified the senior- living center must include three kinds of living options: assisted living for seniors 55+; assisted living for non-seniors; and independent living for seniors.

LUBA agrees and disagrees with both sides on certain points in the assignment and suggests some steps that the City staff and City Council might want to consider taking when they address the remand.

In the meantime, Pinnacle has not begun construction of its assisted-living facility by the post office, despite being permit-ready except for paying its fees. Due to the delays caused by the LUBA appeals, MMV has been prevented from breaking ground, despite the fact that the builder of the assisted-living/memory-care facility has financing lined up and permits secured.

There is still another appeal from Pinnacle waiting to be heard by LUBA regarding the entire MMV subdivision plan.