Timber firm loses compensation fight

Environmental groups and governments won a key victory Thursday when the Oregon Supreme Court ruled a timber company should not be compensated for state restrictions that limited logging to protect a bald eagle nest.

The high court said regulation of private property for public purposes is not the same as taking the property, which would warrant compensation.

Wildlife safeguards curtailed logging on nine of the 40 acres involved and did not deprive the company, Coast Range Conifers of Monroe, of the property's full economic value, the court said in a unanimous opinion.

The decision is a blow to timber companies that had argued such wildlife protections violated federal and state constitutions by restricting use on private lands without compensation.

"This case pretty much brings that whole campaign by the timber industry to an end," said John Echeverria of the Georgetown Environmental Law & Policy Institute in Washington, D.C., who represented conservation groups in the case.

Local governments and groups as varied as Multnomah County, the National League of Cities and the American Planning Association filed arguments in the case, which had the potential to derail land policies such as zoning by forcing compensation of property owners.

Some think the decision hints that justices will be conservative when it comes to awarding compensation under Measure 37, the separate land-use initiative that requires broader payments to landowners hemmed in by land-use rules. However, the court stressed in a footnote that its ruling Thursday expresses "no opinion on the application and meaning of that statute."

At the center of the case was a 40-acre tract of Coast Range forest acquired by Coast Range Conifers in a 1996 land swap with the U.S. Forest Service. A bald eagle nest was found on the land in 1998, and the company sought state permission to log within 330 feet of the nest.

The state forester instead suggested a 400-foot buffer zone around the nest, and the company complied by logging only 31 of the 40 acres. But after the eagle nesting season, the company sought to log the remaining nine acres.

The state forester denied the request, saying eagles were likely to use the nest again.

Coast Range Conifers sued, saying the state's refusal to allow the logging took its property in violation of the Oregon Constitution. It claimed in court that the timber "has no economic value unless it can be logged."

The company wanted the courts to look narrowly at the nine acres where logging was halted to determine whether its property was unfairly taken. But the state said judges should instead consider the entire 40 acres because the logging restrictions on part of the parcel did not remove the value of the entire tract.

An appeals court sided with the company, saying it deserved compensation. But the Supreme Court on Thursday overturned that earlier decision and made clear the value of the entire piece of land must be considered.

"The regulation leaves plaintiff able to log more than three-fourths of its property," the ruling said. "The regulation, in effect, is no different from a rule that permits a landowner to log three out of every four trees in order to prevent soil erosion."

Justices hinted at the consequences if they were to weigh only the part of the land where restrictions applied. Homeowners required to locate their houses at least 10 feet from a street could seek claim payment for the loss of that 10-foot strip, even though they could build on the rest of their lot.

"Clearly this is an important precedent for the state," said Kevin Neely of the state Department of Justice, which argued the case on the state's behalf.

Sara Leiman, who runs Coast Range Conifers for her family, said there is no evidence the eagle nest has been occupied since her family has owned the parcel, but the Oregon Forest Practices Act requires them to protect the nest.

"It's worthless to us right now," she said. "The whole principle is how far do you go before the public helps. How much does the private landowner have to take care of before the public starts helping to pay?"

Assistant state forester Ted Lorensen said the state is sensitive to those concerns.

"It's important for society to think about," he said. "How do we deal fairly with landowners" who bear costs when complying with regulations?

Portland attorney Edward Sullivan, who represented the American Planning Association and 1000 Friends of Oregon in the case, said the ruling is good news for state and local governments. He said it suggests the Supreme Court will be cautious when considering Measure 37 claims.

Governments now face a barrage of requests for payment under Measure 37, which sets different standards for compensation than the Supreme Court applied in Thursday's ruling.

The Associated Press contributed to this report.

Michael Milstein: 503-294-7689; michaelmilstein@news.oregonian.com

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