Lincoln City City Council
Roads End

Despite another tongue lashing by another member of the Roads End Water District Board (REWD), the Lincoln City City Council, none the less, proceeded to vote unanimously Monday night to annex Roads End into the city of Lincoln City. The vote means Roads End will become the newest addition to Lincoln City effective July 1st. That’s when property taxes go up to reflect becoming a part of Lincoln City – that is – if no one goes to court to try to stop the marriage. A group of REWD Board members and angry Roads End homeowners are expected to take legal action to interrupt the process. The city has budgeted at least fifty thousand dollars for their legal fees to fight back.

The story started in the mid-1970s when the Roads End area ran out of water. The state stepped in and brokered a deal to have Lincoln City extend their municipal water lines outside their city limits north into Roads End. With that arrangement Roads End property owners made a commitment to annex into the city no later than 2003. But 2003 came and went and Roads End didn’t annex. What’s more there arose an anti-annexation chorus that also demanded that Lincoln City continue to serve them water.

At that point the 2004 city council asked a Circuit Court judge to rule on whether the city’s now-expired water contract with the Roads End Water District still meant the city had to provide water to Roads End. The judge ruled, “No contract, no water.”

More years came and went until recent pressure by the past two city councils initiated the annexation process themselves. They reasoned that Roads End property owners enjoy FREE backup emergency services from Lincoln City Police, SUBSIDIZED access to the Lincoln City Community Center, FREE benefits from tourism advertising throughout the state which benefits owners of vacation rentals, SUBSIDIZED water service and a number of other “urban level services” that Lincoln City taxpayers were shouldering on their own.

Many Roads End neighbors disagreed strongly saying that their higher water and sewer rates to the city substantially pays for their fair share of the cost of services.

However, Lincoln City appears to have state land use law on their side which notes that Roads End lies inside Lincoln City’s Urban Growth Boundary (UGB). State land use law dictates that any community inside a UGB means that the area outside the city will eventually annex in. It’s literally not a question of “if” but when.

REWD Board members have fought the annexation vigorously for months, declaring that the REWD is a duly created and elected government entity and that they have a right to contract with the city for water. The city council has repeatedly told them no. An REWD Board member Monday night accused the city council of being unfair and biased in their assessment of Roads End’s requirement to annex. The member said consent-to-annex signatures gathered by the city council were a product of coercion, if not extortion, since to fail to sign meant the homeowners’ water would be turned off. The council has reminded others that the aforementioned judge’s ruling in 2004 gave the city the green light to do just that if the contract for water service expires.

Still the board member pushed on, claiming that over one hundred letters-of-consent revocations were now on file with the city, meaning the city no longer has enough “valid” signatures to force the annexation. The city contends the revocations have no bearing on the matter.

With the council’s decision to annex Roads End, the city is expected to notify the Lincoln County Assessor’s office of the change in the status of Roads End and to begin assessing all those in the designated Roads End area as city taxpayers. And taxes will go up depending on the value of the property involved.

Under the plan, city property taxes will be gradually phased in over the next three fiscal years: 70% of the full rate effective July 1, 2013, 85% of full rate effective July 1, 2014, and 100% of the full rate effective July 1, 2015, this in an effort to soften the financial hit property owners will experience. Roads End sewer and water rates will be cut in half effective July 1, 2013. Those owning vacation rentals must obtain a business license from the city by the end of 2013 and room taxes on them must be collected, at the city rate, starting January 1, 2014.

Those who continue to oppose the annexation can take their grievance to the Oregon Land Use Board of Appeals (LUBA) in Salem and claim the process of annexation was not properly followed. But if they don’t get what they want, their next stop would be at the State Court of Appeals if that court would agree to review it. If the opponents get turned down there, they can petition the State Supreme Court to see if they will review it and make a ruling. Or they might just file a lawsuit in an attempt to get an injunction against the city thereby temporarily stopping the annexation process until it’s properly dissected by the courts as to whether those revoked signatures were legally revoked. However, state lawmakers created the LUBA – Court of Appeals – Supreme Court appeal process to keep land use challenges out of the mainstream courts in order to steamline the process.

Just before the vote, City Councilor Chester Noreikis and other city councilors said they regretted the hard feelings including down right anger expressed by Roads End residents but that the council has a duty to Lincoln City taxpayers. Noreikis said while many current Roads End property owners feel the annexation came out of the blue, it has, in fact, been developing for years in an effort to get Roads End property owners to pay their fair share of urban services. Noreikis said when the REWD allowed the water contract to expire in 2003, the district did not secure a water supply of their own. They simply let Lincoln City continue to serve them water. Even today, the REWD has no water supply nor a distribution system to deliver it. Noreikis continued, “On the other hand previous city councils did not property deal with the issue by not making the tough decision. So here we are today.” Councilman Roger Sprague said he remembers well the frightful situation Roads End was in when their water system was failing. Sprague said “I can tell you that in 1980 there was no question in anyone’s mind that annexation into Lincoln City would occur no later than 2003, when the water contract ended.” Mayor Dick Anderson lamented that while most Roads End residents have been cordial in their opposition some have been strident and angry, seemingly unwilling or unable to see the underlying issues. “A blind spot, if you will,” he added.

As Yogi Berra is so often quoted…”It’s not over ’til it’s over.” In this case, we’re probably not even close.

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In what will likely trigger a lawsuit by a number of Roads End residents, the Lincoln City City Council Tuesday night voted to annex the Roads End community just outside the north city limits. The action came after two public hearings during which opponents and supporters of annexation made their case.

Those in support said that Roads End property owners have enjoyed urban services from next door Lincoln City for decades. Those services include sewer, water, back-up police, parks, recreation and tourism promotions, all without paying their fair share of the cost of those services. Opponents characterized the annexation attempt as an unabashed power and revenue grab to make up for poor governance. Roads Enders claimed that they already pay enough taxes and that the issue should be brought to a vote of the people, not just the city council. Still others said that those who signed their consent forms for annexation did so under duress in fear that the city would make good on its threat to shut off their water (since a judge ruled in 2005 that the city was no longer under contract to provide water to Roads End). A few other opponents said that the city claiming it has enough property owner signatures to initiate annexation is baseless, since so many of those who signed did so under “coercion” and that many have since revoked their consent and that their revocation statements are now on file with the city.

City Manager David Hawker said despite receiving those revocation letters, he and City Attorney Joan Kelsey believe the original letters of consent are still valid.

City Attorney Joan Kelsey said the annexation controversy goes back decades. She said it was in the mid 1970′s that the private water system in Roads End had failed and that many of their septic tanks were also in the process of failing. State and local health authorities stepped in and arranged to have Lincoln City extend sewer and water lines to the area, with a commitment from Roads End property owners that they would eventually annex into the city. Kelsey said that contracts to provide sewer and water services were signed – water service expiring in 2003. Soonafter the city tried to convince the area to annex. Residents turned the city down. The city went to court to get a ruling as to whether it could stop serving water to Roads End since there was no longer a contract in place. Kelsey said the judge ruled that without a service contract, cutting off the water would certainly be legal. Hence the city’s current requirement that residents consent to be annexed or have their water shut off and therewith the use of their property.

Kelsey has also stated in the past that state land use law clearly intends for “urban-like high density” areas be annexed into cities so that adequate urban services can be delivered. State law also shows Roads End inside Lincoln City’s Urban Growth Boundary (UGB), the UGB meaning that all land within it will be annexed into the city eventually. Hawker said Lincoln City taxpayers have been promised for decades by Roads End residents that they would eventually join the city. But it never happened. Thus, Tuesday night’s decision by the city council to finally begin the annexation process.

Along with that decision to annex, the council made these provisions:
* The annexation would become official next July 1st.
* All sewer and water bills to Roads End property owners would be cut in half to reflect the same rate as paid by regular Lincoln City residents.
* All surcharges levied for Roads End users for city recreation facilities would be removed.
* Lincoln City Police would begin regular 24/7 patrols throughout Roads End.
* Logan Road and other streets would be maintained by the city.
* Current county zoning would remain in effect – no commercial development is contemplated within Roads End.
* Valid Vacation Rental Dwellings would remain so, but room taxes would rise from 9.0 to 9.5% to reflect the city rate.
* A slow ramp up to higher property taxes MAY be possible. City staff will evaluate its effects on city finances since it would be ramping up urban street and police services without matching revenues.
* Those having a very difficult time with higher property taxes may get some relief from a county run tax-deferral option.

Again, opponents to the annexation, spear-headed mainly by the recently resurrected Roads End Water District (which was disbanded in 1978 and which today owns no water nor pipes to deliver it) have made it clear they intend to seek a court injunction to stop the annexation. But city officials claim they are on firm legal ground in their pursuit of annexing Roads End.

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Lincoln City Planning Commission and Roads End neighborhood

The Lincoln City Planning Commission voted unanimously Wednesday night to ask the city council to annex the Roads End area to capture more revenue to pay for urban services rendered to Roads End residents. It’s claimed that Roads End property owners do not pay a fair share of taxes in supporting them. Those services include back-up police services, connecting roads, water, sewer, tourism promotion, community center, parks and other urban amenities.

However, in getting to that recommendation, planning commissioners had to wade through two public hearings during which many objections were raised challenging the city’s right to annex the area’s 246 acres and $241 million dollars in taxable property. A number of Roads End residents complained that they already pay enough taxes and that Lincoln City wastes taxpayers’ money by having a bloated employee roster. Others complained that they were being blackmailed into agreeing to be annexed since the city said, if they don’t agree to be annexed, the city will turn off their water thereby making their homes uninhabitable. Some residents demanded that the issue be put to a public vote among Lincoln City and Roads End residents.

In earlier discussions, city officials have outlined decades of interaction between Roads End and the city that included how to save Roads End when their water supply was over extended and their septic tanks started to fail. Over the years, the city extended its sewer and water lines into the Roads End area, investing over $9 million recently to keep the water flowing. City officials said they did so under the expectation that Roads End would eventually annex into the city. They added that the last contract for water service by Lincoln City to Roads End expired in 2003. So, under the law, the city is no longer obligated to serve the Roads End area. That conclusion has been backed up by court rulings.

City officials have often noted that the Roads End area doesn’t pay its fair share of local taxes; also that the Roads End area lies within what is called the Lincoln City Urban Growth Boundary (UGB). Under state law, residents and any businesses, that are located within such UGB’s, are forecasted to be eventually annexed into an adjacent city. City officials say state law requires such an orderly process for growth to be controlled and accommodated as well to provide the tax revenues to support it. City officials also claim that, for decades, Lincoln City residents have been burdened with having to subsidize urban services to Roads End residents who don’t pay city property taxes.

City officials contend they have sufficient property owner signatures to trigger the annexation.

Once the annexation is complete, city staff said Roads End streets, including Logan Road, will be maintained by city road crews. Currently only Logan Road is maintained, and that’s by the county. Police patrol services will be 24/7 which the county sheriff does not provide. Water and sewer bills would drop, garbage and trash pick-up fees would drop slightly and non-resident surcharge fees for the community center and other city facilities would be reduced. However, all that would not completely offset the increase in property taxes if Roads End is annexed into the city.

Following Tuesday and Wednesday night’s public hearings, the planning commission unanimously voted to recommend to the city council that the council consider annexing Roads End into the city. The city council will hold two public hearings of its own on November 19th and 20th starting at 6pm at Lincoln City City Hall. After that, the council decides whether to proceed with annexing Roads End.

A group of Roads End residents have vowed to go to court in an effort to block the annexation if the city goes through with it. They contend their constitutional rights of due process and equal protection would be violated if they were brought into the city against their will.

Again, city officials claim they have more than enough Roads End property owner signatures to initiate the annexation.

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Lincoln City City Attorney Joan Kelsey says the city will turn over copies of signed documents from Roads End property owners agreeing to be annexed into the city. The request for copies of those documents has been made by a Lincoln City property owner. But he won’t be getting them right away. In a letter to the attorney for the Roads End Water District directors, Kelsey said the request will have to stand in line behind other public records requests, one of them being very time consuming.

Kelsey had earlier indicated that the records would not be turned over to the water district, which is vigorously fighting the city’s annexation, since the request had come from the water district itself. Kelsey claims that “State law allows copies of public documents to be provided only to “persons,” not to government entities who are not, under the law, persons.” Kelsey added that while a second request for the documents was submitted by civic activist Jim Hoover (who strongly opposes the annexation), she recommended that request be turned down as well, since “Mr. Hoover represented himself as requesting the records in association with the water district.”

Mr. Hoover later denied that contention claiming he was requesting the records solely on the basis of him being a Lincoln City property owner.

Going on at the same time were written correspondence between Lincoln City and Roads End Water District attorney Jack Orchard. Those back-and-forth letters suggested that if Lincoln City could get copies of certain records from the Roads End Water District, then Lincoln City would consider turning over copies of the records requested by the district. However, water district president Chuck Jacobsen wrote to the city, “With no full time staff and limited meeting time of board members, it will take a while to complete the review. We will respond with a summary and estimate of costs as soon as we can.”

Meanwhile, Mr. Hoover claimed that the public records laws of Oregon were being disobeyed, filed a complaint with Lincoln County District Attorney Rob Bovett, demanding that Bovett order Lincoln City to turn over the records he requested. Mr. Hoover said in his letter to Bovett that he’s not affiliated with the water district, owns no land in Roads End, and that his request is that of an individual who owns property in Lincoln City. Mr. Hoover went on to claim that all he wants to do is to have the opportunity to acquire the records and then talk about the issue with his fellow citizens and property owners.

District Attorney Rob Bovett notified the city that he had received the complaint and requested relevant information from the city in order for him to make a ruling on whether the records were being illegally withheld. City Attorney Joan Kelsey responded to Bovett’s letter saying that the city was waiting to hear back from the water district’s attorney as to whether the city’s request of records from the water district were likely to be forthcoming. She said it appeared that it would be a while before the water district would respond based on the letter she had received from the president of the board. She added that the district’s attorney had not replied to her letter for a response. She added that she was hoping that the requests could be honored all the way around without anyone having to pay $1,680 in copying costs which covers only Lincoln City’s part of it.

Kelsey further responded to Bovett’s letter by saying that Mr. Hoover’s request for records will be honored but that it may take a while for him to receive them. She said there are over 5,000 pages of documentation dealing with the signed consent forms returned to the city by Roads End property owners who agreed to be annexed. Under state law, one method of initiating annexation is for the city to receive permission to be annexed by “a triple majority;” a majority of the population, a majority of the assessed valuation of properties owned, and a majority of the land mass to be annexed.

Bovett told News Lincoln County that since the city has now agreed to release the documents to Mr. Hoover, he no longer has any cause to pursue the case.

So, as it stands, the water district says it may take a while to provide the records requested by Lincoln City, and Lincoln City’s position is the same, adding that there are substantial public records requests ahead of the water district having nothing to do with the Roads End situation, and that staff is quite busy with that as well as their normal duties at city hall.

Meanwhile the city has launched procedures to annex the Roads End area, claiming they have received sufficient property owner consent forms to achieve the “triple majority” requirement for annexation. Contained in those annexation consent forms was a statement by the city that if they didn’t sign the agreement, the city would be in a position to turn off their water.

The battle goes back many years to a time when the Roads End Water District was ordered by the courts to hook up to city water and sewer due to failing groundwater and contamination of soils from septic tanks. Water and sewer systems were installed by Lincoln City on a promise that the area would eventually annex into the city since water and sewer bills would never cover the complete cost of the systems.

It’s been well over twenty years and yet Roads End residents still don’t want to become part of the city. Residents complain their property taxes would rise and they fear Lincoln City would allow hotels to occupy stretches of the bluff line overlooking the ocean. But Lincoln City officials contend the area still gets urban services, even back up police protection when no sheriff’s deputies are in the area. City officials also contend that Roads End, which is made up of many vacation rentals, benefits from the city’s costly tourism and special events promotion budget, community center, pool, parks, streets, and other urban advantages while not contributing significantly to their costs.

Under state law, areas like Roads End that lie within the city’s Urban Services Boundary, are expected to eventually annex into the city. City officials say that Roads End property owners have long been subsidized by Lincoln City taxpayers in offering urban services to Roads End without Roads End property owners having to cover the cost for them. Even Lincoln County Commissioners recently sent a letter to Lincoln City strongly supporting the annexation as long over due and that the county is not financially capable of providing sewer and water services, urban scale law enforcement and many other city-grade services to the Roads End area.

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