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Memo to Les Lyle <br /> September 3, 1993 <br /> Page 3 <br /> Even if there is no new development within the neighborhood where the new facility <br /> was purchased /constructed, if the facts are strong enough to tie the expenditure to new <br /> development it may pass legal muster. For example, if new development elsewhere was <br /> putting too much pressure on an existing park or recreation facility (tennis courts, swimming <br /> pool, recreation center, etc.) that was used by the existing facility- deficient neighborhood, <br /> then the construction of a new facility in the deficient neighborhood might be tied enough <br /> to the new development to allow SDC funds to be used. It is certainly not a certain thing, <br /> but may be possible. <br /> One of the fundamental principles in the Methodology is that development impacts <br /> the entire city and therefore it will be used for development related projects anywhere in the <br /> city. This allows the proposed expenditure within an established neighborhood, but that is <br /> possible only if the project (or the portion of the project financed with SDC revenue) is <br /> reasonably related to development. Obviously, the closer to areas of new development, the <br /> easier it is to tie the acquisition to the pressure of new development. <br /> 3. ORS 223307(4) requires that the capital improvements upon which any SDC <br /> revenue is expended must appear in the approved plan. <br /> Since the Council may amend the statutorily required "plan" at any time, meeting this <br /> criteria should not pose a problem unless the capital improvement never makes it to the <br /> Plan. Then, fixing the situation after the fact may be difficult. <br /> Case law. <br /> As yet there are no Oregon cases dealing with the expenditure of SDC revenue by <br /> a public body. There is a trial court case pending involving the City of Sherwood's park <br /> SDC. Even that case only deals with the power of the City to exact the payment from the <br /> developer. The question you have raised deals with how such revenue is expended. <br /> We believe the courts will continue to look for a "reasonable relationship" between <br /> who paid the fee and how the revenue was expended. For example, although the facts are <br /> different, in Dolan v. City of Tigard, 113 Or App 162 (1992), the court found a reasonable <br /> relation between mandated easements for a bikeway and drainage way because the new <br /> development burdened the city's existing facilities. The court said there must be "...a direct <br /> and reasonable relationship between the conditions that the city attached to its approval of <br /> the intensified use and the impacts and public needs to which the use will give rise." Id. at <br /> 168. The methodology and Plan adopted by the Council provides the legislative <br /> determination of that reasonable tie. <br /> • <br />