Legal Issues of the Timber Harvesting by PLA

    Ad Hoc Chairs to Patrick Schneider (outside attorney hired by the County):  7/20/15

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South Bay Community Association  (SBCA)                                                                                   120 Spinnaker Place  Port Ludlow, WA

 Ludlow Maintenance Commission (LMC)                                                                                       P.O. Box 65060        Port Ludlow, WA

Port Ludlow Village Council  (PLVC)                                                                                               P.O. Box 65012        Port Ludlow, WA

Patrick J. Schneider, Esq.                                                                                                 Foster Pepper PLLC    Seattle, WA 98101

Re: Timber Harvesting in the Port Ludlow MPR

As chairs of the SBCA, LMC and PLVC ad hoc committees on timber harvesting, the three of us are writing to explain our view of the pertinent legal issues and to comment on the arguments that we understand have been made by Mr. de Sa e Silva on behalf of PLA.

First we will discuss the issues that have been raised about whether the timber harvesting was legal. Next we will discuss the issues about the county’s potential remedies against PLA. Finally, we will briefly discuss our ideas about a sensible way to resolve the dispute and, hopefully, turn the present unhealthy relationship between PLA and the residents into a mutually beneficial “partnership” and a stronger resort community.

I. Illegality of Commercial Timber Harvesting in the MPR 

We think the appropriate starting point for analyzing the applicable legal framework is the Washington Growth Management Act, RCW chapter 36.70A, which was enacted to, among other things, encourage future development in urban areas and avoid uncoordinated and unplanned development in rural areas. See, generally, RCW 36.70A.010 – .020. The Act required certain counties and cities, and encouraged others, to develop comprehensive land use plans in furtherance of the Act’s goals. RCW 36.70A.040. State agencies are required to comply with local comprehensive plans and development regulations adopted pursuant to the Act. RCW 36.70A.103.

The Act allows a county to provide for “urban growth outside of urban growth areas” in a new (RCW 36.70A.360) or existing (RCW 36.70A.362) “master planned resort” only if certain criteria are met. An “existing resort” is defined as “a resort in existence on July 1, 1990, and developed, in whole or in part, as a significantly self-contained and integrated development that includes short-term visitor accommodations associated with a range of indoor and outdoor recreational facilities within the property boundaries in a setting of significant natural amenities. An existing resort may include other permanent residential uses, conference facilities, and commercial activities supporting the resort, but only if these other uses are integrated into and consistent with the on-site recreational nature of the resort.” RCW 36.70A.362 (emphasis added). Furthermore, “[a]n existing resort may be authorized by a county only if: . . . (3) The county includes a finding as a part of the approval process that the land is better suited, and has more long-term importance, for the existing resort than for the commercial harvesting of timber or agricultural production, if located on land that otherwise would be designated as forest land or agricultural land under RCW 36.70A.170.” Id. (emphasis added).

In 1998 Jefferson County adopted a new comprehensive plan and, pursuant to RCW 36.70A.362, designated Port Ludlow as an existing master planned resort. As required by the statute, the county commissioners adopted findings that the land in question was better suited for resort purposes than for the commercial harvesting of timber:

15. In 1998, during review of the Jefferson County Comprehensive Plan as recommended by the Jefferson County Planning Commission, the BOCC designated Port Ludlow as a Master Planned Resort based on its phased development patterns and because it meets the criteria for existing master planned resorts codified as RCW 36.70A.362.

 16. The BOCC finds that, because of its development history and patterns of development, the land on which Port Ludlow is located is determined to be better suited and has more long-term importance as a Master Planned Resort than for the commercial harvesting of timber or agricultural production.

Jefferson County Board of County Commissioners Resolution 72-98 (adopting 1998 Comprehensive Plan), Findings of Fact at 22-23 (emphasis added). The 1998 Comprehensive Plan superseded any prior inconsistent designation of forest lands or other natural resource elements. JCBOCC Resolution 72-98, Section 3: “The 1998 Comprehensive Land Use Plan shall govern all planning in Jefferson County. Where any conflicts may arise between the 1998 Comprehensive Land Use Plan and existing County rules, regulations, policy or ordinances, the 1998 Comprehensive Plan shall prevail.”

Note that the commissioners’ Finding of Fact No. 16, quoted above, was tantamount to a recognition that the treed parcels within the Port Ludlow MPR did not constitute “forest land” within the meaning of the Growth Management Act. The Act defines “forest land” as follows:

Forest land” means land primarily devoted to growing trees for longterm commercial timber production on land that can be economically and practically managed for such production, . . . , and that has longterm commercial significance. In determining whether forest land is primarily devoted to growing trees for long-term commercial timber production on land that can be economically and practically managed for such production, the following factors shall be considered:

  • (a) The proximity of the land to urban, suburban, and rural settlements;
  • (b) surrounding parcel size and the compatibility and intensity of adjacent and nearby land uses;
  • (c) long-term local economic conditions that affect the ability to manage for timber production; and
  •  (d) the availability of public facilities and services conducive to conversion of forest land to other uses.

RCW 36.70A.030(8)(emphasis added).

In 1999 the county adopted Ordinance No. 08-1004-99, known as the “MPR Code,” establishing land use regulations for the land within the Port Ludlow Master Planned Resort. The MPR Code is now codified as Jefferson County Code Title 17, entitled “Port Ludlow Master Planned Resort.” Section 2.20 of the MPR Code (now codified as JCC 17.05.090), entitled “Compliance With Regulations Required,” provides that “No structure shall hereafter be erected and no existing structure shall be moved, altered, added to or enlarged, nor shall any land or structure be used, or arranged to be used for any purpose other than that which is included among the uses listed in the following chapters as permitted in the zoning district in which the structure or land is located, nor shall any land or structure be used in any manner contrary to any other requirement specified in this Ordinance.” (Emphasis added).

Thus, the MPR Code provides that land uses that are not listed as permissible are therefore impermissible. (We understand that Mr. de Sa e Silva argues that the Code cannot really mean what it says in this regard, and that unless a use is explicitly prohibited it must be deemed permissible; we address that argument later in this letter.)

The three zoning classifications applicable to the parcels on which PLA has harvested timber within the MPR in 2014 and 2015 are MPR-SFT (Single Family Tract), MPR-RA (Recreation Area) and MPR-OSR (Open Space Reserve). The purposes, permissible uses and conditionally permissible uses for those zoning classifications are set forth in Sections 3.201, 3.202 and 3.203 (MPR-SFT) [JCC 17.15.010 – .030], Sections 3.601 and 3.602 (MPR-RA) [JCC 17.35.010 – .020], and Sections 3.701, 3.702 and 3.703 (MPR-OSR) [JCC 17.40.010 – .030] of the MPR Code.

Commercial timber harvesting is not listed as a permissible or conditionally permissible use under any of those zoning classifications, nor would such timber harvesting serve to promote the stated purposes of those zoning classifications (except to the extent the harvesting is done for the purpose of clearing the land for single family residential use in the MPR-SFT zone or for the designated recreational uses in the MPR-RA zone). Indeed, clear-cutting timber in the MPR-OSR zone is directly contrary to the stated purpose of that zoning classification:

3.701 Purpose: The Open Space Reserve zone preserves in perpetuity and enhances the natural amenities around Ludlow Bay, the Twin Islands and other natural areas within the MPR. Uses within the Open Space Reserve shall be low impact and serve to promote or enhance the aesthetic qualities of the Master Planned Resort. No residential or commercial development shall be permitted in the MPR-OSR zone.

MPR Code § 3.701 [JCC 17.40.010] (emphasis added). Clear-cut timber harvesting does not “preserve in perpetuity” nor “enhance the natural amenities” within the MPR, and it is neither “low impact” nor does it serve to promote or enhance the “aesthetic qualities” of the MPR.

Another provision of the MPR Code to keep in mind is Section 1.40 [JCC 17.05.050]. That provision lists other ordinances and requirements that “may qualify or supplement the regulations presented in this ordinance” (including, for example, Ordinance No. 01-0121-97, the Forest Lands Ordinance), and then goes on to state:

Where the regulations of this ordinance, those set forth below, or any other local, state, or federal regulations overlap, the most restrictive and/or protective standards shall apply.

MPR Code, Section 1.40 [JCC 17.05.050] (emphasis added).

On May 1, 2000 PLA’s predecessor-in-interest (“Pope”) entered into the Port Ludlow Development Agreement with Jefferson County. Article 3 of the Development Agreement sets forth “development standards” for the Pope (now PLA) property within the MPR. Zoning restrictions are addressed in Section 3.1 of the Agreement, which provides that the “permitted land uses, regulatory standards and density standards for development” within the MPR are set forth in the MPR Code attached as Appendix A to the Agreement. Section 3.2 says the planning goals and policies for the MPR are set forth in Appendix B. Ensuing sections of Article 3 deal with such subjects as surface water standards (§3.3, see Appendix C); critical area standards (§3.4, see Appendix D); platting standards (§3.5, see Appendix E); the shoreline master program (§3.6, see Appendix F); water service (§3.7); sewer service (§3.8); police services (§3.9); and fire services (§3.10). Section 3.11 allows for certain flexibility or modification of the initial development concepts. Section 3.12 addresses procedures for review and approval of proposed development applications (see Appendix E).

The key provision of the Development Agreement for present purposes is Section 3.13, entitled “Vesting of Development Standards and Mitigation.” It provides that all “development” proposed on Pope (now PLA) property within the MPR “shall be vested to and governed by the Port Ludlow MPR chapter of the Jefferson County Zoning Code (as defined in Section 3.1 and Appendices A-F) and shall be implemented through plats, short plats, binding site plans, boundary line adjustments, site development permits, building permits and other permits and approvals issued by the County.” It goes on to provide that, with certain exceptions not relevant here, “any new or different development standards adopted by the County during the term of this Agreement shall not apply to Pope [now PLA] property. To the extent this Agreement does not establish standards or requirements covering a subject, element or condition, then the development approval sought shall vest to and be governed by the County codes, regulations and standards in effect upon the date of the future application.” (Emphasis added).

What this provision says is simply that the “development standards” set forth in the Agreement and its Appendices will govern development of the Pope (now PLA) property within the MPR and that any new or different “development standards” adopted after the effective date of the Agreement will not apply to the Pope (now PLA) property. The present dispute does not involve any new or different development standards adopted after the date of the Agreement. They are exactly the same development standards, i.e., exactly the same restrictions on the permissible uses of the Pope (now PLA) property within the MPR, as set forth in the MPR Code attached as Appendix A, codified in JCC Title 17, and incorporated in the Development Agreement.

It is important to remember that the land use restrictions set forth in the Development Agreement were not imposed on Pope in some imperious fashion. Pope voluntarily entered into the Agreement with the county in May 2000 to establish the development standards that would apply for the term of the agreement, which was originally for 20 years and was subsequently extended for another five years.

Pope did not agree to those restrictions out of the kindness of its heart. As with any clustered development project, Pope got something very valuable in exchange for agreeing to those land use restrictions. For example, in return for agreeing to preserve open spaces in perpetuity to enhance the natural amenities and aesthetic qualities of the resort, and for agreeing to the other restrictions set forth in Appendix A to the Agreement, Pope got the right to build housing with much greater density than would otherwise have been allowed. In addition, Pope got the certainty of knowing what development standards would be in effect for the next 20 years (which, presumably, was expected to be more than enough time to finish the overall MPR development project).

One of the provisions included in Appendix B to the Agreement was the county commissioners’ formal finding in 1998, when the MPR was established, that “because of its development history and patterns of development, the land on which Port Ludlow is located is determined to be better suited and has more long-term importance as a Master Planned Resort than for the commercial harvesting of timber or agricultural production.” That finding is incorporated in and is part of the Development Agreement, and by entering into that Agreement Pope (now PLA) acknowledged and accepted that finding. By enforcing the prohibition of commercial timber harvesting in the MPR, the county is not depriving PLA of any of its rights as a property owner. The county is merely enforcing a prohibition that the developer agreed to in May 2000. In this connection, note that Section 4.14 of the Agreement, entitled “Construction,” states that “This Agreement has been reviewed and revised by legal counsel for all parties and no presumption or rule that ambiguity shall be construed against the party drafting the document shall apply to the interpretation or enforcement of this Agreement.”

The Development Agreement must be viewed in the context of implementing the purposes for establishing the Port Ludlow MPR, including the county commissioners’ finding, incorporated in the Agreement, that the land in question is better suited for resort purposes than for commercial timber harvesting. Viewed in this light, the Agreement cannot fairly be read as impliedly allowing commercial timber harvesting within the MPR despite the express language to the contrary set forth in MPR Code § 2.20 [JCC Title 17.05.090] (prohibiting land uses not listed as permissible) and the sections listing the purposes and permissible uses of the various zoning classifications for the MPR.

PLA’s principal argument, as expressed to us by Mr. de Sa e Silva at our meeting on July 7, is that any activity is permissible unless it is explicitly and specifically prohibited. We are unaware of any legal support for that proposition.

First, his suggestion that zoning codes must be strictly construed against the governmental entity imposing the land use restrictions would not be applicable here, even if there were any merit to that notion generally. That is because the land use restrictions here were contractually and voluntarily agreed to by Pope in the Development Agreement, not “imposed” upon Pope by the county. If this dispute ends up in litigation, the court’s job will be to ascertain the parties’ mutual intent as expressed in the Development Agreement, viewed in the context of the circumstances giving rise to the Agreement. See Berg v. Hudesman, 115 Wn.2d 657 (1990), and its progeny. In view of (i) the purposes and statutory criteria for establishing an MPR, (ii) the county commissioners’ finding that the land in the MPR is better suited for resort purposes than for commercial timber harvesting, (iii) the express language of the MPR zoning code prohibiting land uses that are not listed as permissible, (iv) the language describing the purposes of the MPR-OSR zone, and (v) the language stating that in the event of any overlap with other ordinances or regulations “the most restrictive and/or protective standards shall apply” (MPR Code § 1.40, JCC 17.05.050), we think it is highly unlikely that a court would conclude that the parties intended to allow commercial timber harvesting within the MPR.

At our meeting Mr. de Sa e Silva offered lawn mowing as an example of an activity that is not listed expressly as permissible but surely would be allowed in a residential zone and argued that therefore the Code cannot literally mean what it says. The answer to that argument is that case law and zoning codes generally recognize the concept of “accessory” or “incidental” land uses. In Jefferson County that concept is reflected in JCC 18.20.020: Accessory uses are customarily incidental and subordinate to the principal use of a structure or site. They must be:

  • Clearly secondary to, supportive of, and compatible to the principal or permissibly principal uses;
  • Consistent with the purpose of the land use district; and
  • In compliance with the provisions of this code. The land use category of an accessory use shall be the same as that of the principal use(s) listed in Table 3-1 or Chapter 18.18 JCC, unless otherwise specified.
  • (1) Limitations on Accessory Uses and Structures. Accessory uses and structures are permitted in any district, except as limited or prohibited in this section, in Table 3-1, or in the sections covering the various land use districts in Chapter 18.15 JCC, or in Chapter 18.18 JCC.

Jefferson County Code § 18.20.020 (emphasis added). Thus, incidental activities like lawn mowing (as well as growing and cutting flowers, hiking, and guitar playing, the examples cited in paragraph 2 of Mr. de Sa e Silva’s letter of May 19), would constitute permissible “accessory” activities in a residential land use zone, because they are “incidental and subordinate” to the principal use (residential) and are “clearly secondary to, supportive of, and compatible” with the permissible principal use.

We doubt if Mr. de Sa e Silva would get very far with the court if he tried to argue that hauling in heavy equipment and converting a heavily treed parcel into an ugly clearcut “war zone” is analogous to mowing the lawn, picking flowers or playing a guitar.

Logging for the purpose of clearing the land for a permissible use (such as development of residential lots in the MPR-SFT zone) is impliedly permissible, because it is in furtherance of (i.e., secondary to, supportive of and compatible with, and consistent with the purpose of) the permissible use; but clear-cut logging solely for the commercial purpose of selling the logs, with no intention of developing the land for a permissible use, is not.

In this connection, note that under JCC 17.05.050(8) and JCC 18.15.138, Titles 17 and 18 are in effect incorporated in each other. Thus, for example, the “accessory uses” concept set forth in JCC 18.20.020 is equally applicable to Title 17 (as well as being implied in law), and the enforcement provisions of JCC 18.50 are applicable to violations of Title 17.

Nor is there any merit to Mr. de Sa e Silva’s argument that “growing trees is appurtenant to land ownership.” (Letter of May 19, Item 2.) In the first place, the issue here is clear-cut logging for commercial purposes, not “growing trees.” Commercial timber harvesting is no more “appurtenant to land ownership” than any other business that uses land, such as operating a steel mill, a cattle feedlot or a strip mine.

Mr. de Sa e Silva’s next argument, that timber harvesting was an “existing use” when the Development Agreement was entered into, is similarly unpersuasive. There is no evidence that any commercial timber harvesting was taking place within the boundaries of the MPR at any time close to the 1998-2000 time period when the MPR was being established, the MPR zoning code was being adopted, and the Development Agreement was being entered into by Pope and the county. MPR Code § 2.40 [JCC 17.05.110] applies to “existing” uses, not to historical prior uses. The fact that many decades ago a sawmill was operated in the marina area does not mean that PLA could start up a sawmill operation there now as an “existing use.” “Existing” means existing, not prior. See JCC 18.20.260(1).

The last argument on the “illegality” issue set forth in Mr. de Sa e Silva’s letter is that the county does not have “authority to regulate forest practices” because it has not “taken that authority from the DNR” as provided in RCW 76.09.240. The simple answer to that argument is that the county is not “regulating” forest practices; it is enforcing a contract that PLA’s predecessor-in-interest voluntarily entered into in 2000, in the form of the Port Ludlow Development Agreement. In that Agreement Pope agreed to be subject to the MPR zoning code attached to the Agreement as Appendix A, now codified in JCC Title 17. A court would need to look no further than that Agreement to dispose of Mr. de Sa e Silva’s argument on this point.

Furthermore, by entering into the Development Agreement, and thereby acknowledging and accepting the county commissioners’ finding in Appendix B that the land in the MPR was better suited for resort purposes than for commercial timber harvesting, Pope in effect withdrew its forested land within the boundaries of the MPR from the scope of what constitutes “forest land” within the meaning of the Growth Management Act (see RCW 36.70A.030(8), discussed above) or “forest resource lands” within the meaning of Jefferson County Code Title 18 (see JCC § 18.10.005 and definition of “forest resource lands” in JCC § 18.10.060 F). While the definition of “forest land” in the Forest Practices Act is different (see RCW 76.09.020(15)), the best way to harmonize the statutory schemes of the Growth Management Act and the Forest Practices Act in this context is to recognize that by entering into the Development Agreement Pope was agreeing that the land within the Port Ludlow MPR would not be treated as “forest land” but as land designated for the non-forestry uses set forth in the MPR zoning code.

Moreover, the county’s zoning code does not regulate forest practices, i.e., how timber may be grown or harvested, just as it does not regulate how other commercial enterprises may be conducted. It only regulates where particular kinds of businesses may be operated. Nothing in the Forest Practices Act says that a county cannot adopt or enforce zoning laws governing where commercial timber harvesting may be conducted (as distinguished from regulating how the harvesting must be done).

Finally, in its applications under the Forest Practices Act PLA expressly acknowledged that the proposed forest practice was “subject to . . . all other federal, state or local regulations” (¶ 32), and the DNR Notices of Decision expressly stated that “Operating as described in this application/notification does not ensure compliance with . . . other federal, state or local laws.” (Notices of Decision, page 2).

DNR apparently issued logging permits to PLA in disregard of the requirement in RCW 36.70A.103 that DNR must “comply with the local comprehensive plans and development regulations and amendments thereto adopted pursuant to” the Growth Management Act, but even in those permits PLA was cautioned that it must comply with “other federal, state or local laws.” Simply put, the granting of a DNR permit under the Forest Practices Act does not preempt application of the county’s MPR zoning code and does not relieve PLA of its contractual obligation to comply with the land use restrictions set forth in the MPR zoning code incorporated in the Development Agreement.

We do not believe there is merit to any of the arguments made by Mr. de Sa e Silva in his letter of May 19, and we do not believe they would be persuasive to a court. PLA cannot get around the basic fact that Pope agreed to the land use restrictions set forth in Appendix A to the Development Agreement, and PLA is bound by that Agreement. The MPR Code incorporated in that Agreement expressly provides that uses not listed as permissible are therefore impermissible, and we do not believe that any court, arbitrator, mediator or other objective observer could be persuaded that clear-cut commercial timber harvesting for non-conversion purposes is merely “incidental” to the permissible residential or recreational uses for the parcels zoned MPR-SFT or MPR-RA, or that it “preserves in perpetuity and enhances the natural amenities” or is “low impact and serve[s] to promote or enhance the aesthetic qualities” of the MPR, as required for the MPR-OSR zones.

II. Enforcement Remedies 

The Development Agreement sets forth “development standards” for the MPR, including the land use restrictions set forth in Appendix A (the MPR zoning code, now codified as JCC Title 17). The original version of the MPR zoning code, included in the Agreement as Appendix A, did not include any provisions dealing with enforcement or remedies for violations. Nor is there any other provision in the Development Agreement dealing with enforcement mechanisms or remedies for violations of the land use restrictions. As noted above in this letter, Section 3.13 of the Agreement provides that while the “development standards” applicable to the Pope property within the MPR will not be changed for the next 20 years, if the Agreement is silent on a particular subject then the rules currently in effect at the time an issue arises in the future will be applicable.

Nothing in the Development Agreement says that the county cannot adopt new or different enforcement mechanisms or procedures to deal with violations of the zoning restrictions set forth in the Agreement. In this connection, note that Appendix E attached to the Agreement deals only with procedures for review and approval of land use applications. It does not deal with enforcement or remedies for violations.

Thus, the county is free to adopt enforcement mechanisms and remedies for zoning violations at any time, and PLA is subject to those new or different mechanisms and remedies the same as any other party. The only real effect of the Development Agreement is to prohibit the county from imposing upon PLA’s land within the MPR any new or different zoning restrictions or other such “development standards.” The county has not imposed any new zoning restrictions on PLA; it is merely exercising its inherent police power to enforce the zoning restrictions that were agreed to in the Development Agreement.

Mr. de Sa e Silva’s letter of May 19 seems to acknowledge that §3.13 of the Development Agreement applies only to development standards and development approval procedures, “not code enforcement.” (Letter, at page 4). His letter then goes on to make a completely illogical argument: since there are some enforcement provisions included in the appendices covering other subjects (stormwater management, critical areas, subdivisions, and shoreline management), this somehow precludes the county from adopting provisions for enforcement of zoning restrictions.

That argument makes no sense. There is nothing in the Development Agreement that addresses remedies for violations of the zoning restrictions incorporated in the agreement, and there is nothing in the Agreement that precludes the county from adopting enforcement mechanisms to provide remedies for violations of those restrictions. Since there is nothing in the Development Agreement that precludes the county from subsequently adopting methods to enforce the agreed zoning restrictions, PLA has no basis for claiming that it is exempt from the remedies set forth in JCC Chapter 18.50, which are applicable to violations of JCC Title 17 by virtue of JCC 17.05.050(8) and JCC 18.15.138.

Under JCC 18.50.020(4), it is a violation for any person to fail to comply with any provision of the zoning code. Under JCC 18.50.030(3), “[t]he owner of any real or personal property subject to enforcement action and/or any person responsible for a violation at a particular site or real property shall be individually and jointly liable for failure to comply” with the zoning code. Thus, as to the parcels owned by PLA, both PLA and its logger (Joseph T. Cedarland or Cedarland Forest Resources) are individually and jointly liable for the zoning violation.

JCC 18.50.110 provides, in relevant part, as follows:

18.50.110 Civil and criminal penalties.

(1) Civil Penalties. Any person who violates any development regulations, or rules or regulations adopted under the UDC, or the conditions and/or mitigation measures of any permit issued pursuant to such ordinance, rule or regulation, or who, by any act or omission procures, aids or abets such violation shall be subject to civil penalties as provided in this chapter.

(a) Civil penalties may be assessed by the administrator by means of a formal notice and order issued pursuant to this chapter and may be recovered by legal action filed by the prosecuting attorney.

(b) Civil penalties, once perfected through the appropriate legal action, shall be collected in the same manner as judgments in civil actions.

(c) Civil penalties shall be a cumulative penalty in the amount of $100.00 per day for each violation. Penalties for the second separate violation of a like nature by the same person within a period of two years shall be double that rate.

(d) Each and every day or portion thereof during which any violation is committed, continued, permitted or not corrected shall be deemed a violation for purposes of this chapter. . . .

(e) In addition to the penalties set forth in this section, violations causing significant damage as defined by the following acts may also be assessed penalties at an amount reasonably determined by the administrator to be equivalent to the economic benefit that the violator derives from the violation, as measured by the greater of the resulting increase in market value of the property or the value received by the violator, or savings of construction costs realized by the violator:

(i) Grading (filling and/or excavation), clearing of vegetation and trees, and/or draining of riparian corridors, wetlands and their buffers; or

(ii) Destruction of a historic landmark, or cultural or archaeological artifact as defined by county ordinance.

(2) Payment of a civil penalty initially assessed pursuant to this chapter does not relieve a person of the duty to correct or remediate the violation as ordered by the administrator.. .

(5) Additional Relief. Notwithstanding other remedies in this chapter, the administrator may seek legal or equitable relief to enjoin any acts or practices or abate any conditions which constitute or will constitute a violation of any land use provision or regulations adopted under the UDC when civil or criminal penalties are inadequate to effect compliance.

(6) Violator’s Liability for Damages. Any person who violates any provisions or any permit issued under the UDC shall be liable for all damage to public or private property arising from such violation, including the cost of restoring the affected area to its condition prior to violation. The prosecuting attorney may bring suit for damages under this chapter on behalf of the county. If liability has been established for the cost of restoring an area affected by a violation, the court shall make provision to assure that restoration will be accomplished within a reasonable time at the expense of the violator. [Ord. 2-06 § 1]

(Emphasis added).

The clear-cutting of the parcels in question obviously caused “significant damage” as defined in JCC 18.50.110(1)(e)(i) (“clearing of vegetation and trees”), subjecting the violators to penalties in an amount “equivalent to the economic benefit that the violator derives from the violation,” as measured by “the value received by the violator.” JCC 18.50.110(1)(e). The “value received by the violator” means the gross revenues received from the sale of the timber, not merely the profits realized.

Thus, the potential civil penalties include (1) $100 per day, from the date the logging commenced until it has been fully remediated, for the logging in the MPR-SFT one on the north side of Oak Bay Road, plus (2) $200 per day, from the date the logging commenced until it has been fully remediated, for the logging in the MPR-RA zone, plus (3) $200 per day, from the date the logging commenced until it has been fully remediated, for the logging in the MPR-OSR zones, plus (4) the amount of the gross revenues received from the sale of the timber, plus (5) the costs of fully remediating the violations. Full remediation would include, at a minimum, restoring the sites to their pre-logging condition and remediating any environmental damage to streams and slide-prone areas, as well as dealing with the reported spillage of oil or hydraulic fluid.

In addition, it should be noted that violations of the MPR zoning code also constitute misdemeanors, potentially subjecting PLA to the criminal penalties set forth in JCC 1.01.160, including a fine of up to $500 per day for each day since the logging commenced:

Any person violating any provision or failing to comply with any mandatory requirement of the laws, resolutions or ordinances of Jefferson County shall be guilty of a misdemeanor. Any person convicted of a misdemeanor under the laws, resolutions or ordinances of Jefferson County shall be punished by a fine of not more than $500.00 and/or be incarcerated for a period not to exceed 90 days. Each person shall be guilty of a separate offense for each and every day during any portion of which any violation of the provision of the laws, resolutions or ordinances of Jefferson County is committed, continued or permitted by any such person, and shall be punished accordingly.

Finally, if litigation is necessary and the county prevails in establishing that PLA has violated the land use restrictions under the MPR zoning code, then PLA will not only have to pay its own attorney fees but under Section 4.12 of the Development Agreement will also be liable for the county’s attorney fees.

In Mr. de Sa e Silva’s letter of May 19, he makes four arguments about the amount of penalties that could be assessed against PLA. First, he argues (Item 5 of his letter) that the enforcement provisions of the UDC (JCC Title 18) do not govern enforcement of the MPR zoning code. Apparently his argument is that since the MPR zoning code (Appendix A to the Development Agreement) does not contain enforcement provisions, whereas other appendices to the Agreement do contain certain enforcement provisions, this somehow leads to the conclusion that the county is powerless to enforce the MPR zoning code. That argument is devoid of logic, as explained above in this letter at pages 11-12. Although the Development Agreement bars the county from imposing new or different “development standards” on Pope (now PLA) for the 20-year (now 25-year) term of the Agreement, there is nothing in the Agreement, and nothing in the law, that prevents the county from adopting ordinances or amendments to enforce the development standards that were agreed to in the Development Agreement. That is an inherent power of the county.

Next, Mr. de Sa e Silva argues (Item 6 of his letter) that the UDC (JCC Title 18) enforcement provisions could not be used for the benefit of the South Bay Community Association, citing JCC 18.50.030(1). In its May 7, 2015 letter to PLA, the county was not making a demand to PLA to pay anything to SBCA. The county was proposing a compromise to PLA, under which PLA would provide an amenity to the adversely affected community in lieu of incurring otherwise applicable penalties. The county had every right to propose such a compromise. If PLA does not wish to accept that compromise proposal, PLA can of course opt to pay the full panoply of monetary penalties to the county as described above.

The next argument set forth in Mr. de Sa e Silva’s letter (Item 7) is that the penalties cannot include an amount “equivalent to the economic benefit that the violator derives from the violation” (JCC 18.50.110(1)(e)), purportedly because that penalty component can arise only when the clearing of vegetation and trees occurs in riparian corridors, wetlands or their buffers. That is an obvious misreading of the ordinance. The “economic benefit” penalty applies when the violation causes “significant damage” as defined in the ordinance. The ordinance defines “significant damage” as either:

(i) Grading (filling and/or excavation), clearing of vegetation and trees, and/or draining of riparian corridors, wetlands and their buffers; or

(ii) Destruction of a historic landmark, or cultural or archaeological artifact as defined by county ordinance.

JCC 18.50.110(1)(e). Subsection (i) says that either “grading (filling and/or excavation)” or “clearing of vegetation and trees” or “draining of riparian corridors, wetlands and their buffers” constitutes “significant damage” triggering the “economic benefit” penalty. Mr. de Sa e Silva’s suggestion that “clearing of vegetation and trees” constitutes “significant damage” only if it occurs in riparian corridors, wetlands or their buffers makes neither grammatical nor common sense. Any objective observer who makes a before-and-after comparison between a beautifully treed parcel and the devastated wasteland of a clear-cut would agree that the clear-cutting constituted “significant damage” within the meaning of JCC 18.50.110(1)(e).

The final argument made in Mr. de Sa e Silva’s letter about the amount of penalty (Item 8) is that in assessing the “economic benefit” penalty, the county would have to “take into account” the diminution in value of PLA’s property, since “it is impossible to cut and remove trees from real property without reducing the value of the land.” That argument totally disregards the language of the ordinance. The ordinance expressly explains that the “economic benefit” is to be “measured by the greater of the resulting increase in market value of the property or the value received by the violator, or savings of construction costs realized by the violator.” JCC 18.50.110(1)(e). In this context “value received” means gross revenues, or arguably gross revenues less sales costs (such as sales commissions if any); it almost certainly does not mean gross revenues less production costs or cost of goods sold, or net revenues, or profits.

Finally, at our July 7 meeting with Mr. Verrue, Mr. de Sa e Silva said he had just thought of a “new argument” that was not included in his letter of May 19. As we understand it, that argument is based on a strained interpretation of JCC 18.50.120, which relates specifically to enforcement of JCC Chapter 18.35 relating to land divisions, not zoning or land use restrictions. JCC 18.50.120 provides: The procedures and penalties of this chapter expressly do not repeal and replace the penalties and enforcement provisions of Chapter 18.35 JCC, Land Divisions, but shall apply only to conditions of final plat approval.

All other enforcement and penalty provisions of Chapter 18.35 JCC, as they now exist or are later amended, shall remain in full force and effect. JCC Chapter 18.35 includes its own enforcement provisions (see, e.g., JCC 18.35.050). What JCC 18.50.120 says is simply that the enforcement provisions of Chapter 18.50 “do not repeal and replace” the enforcement provisions of Chapter 18.35 but do apply to enforcement of the conditions of final plat approval. Mr. de Sa e Silva’s “new argument” that Chapter 18.50 was not intended to apply to anything other than conditions of plat approval, and that in adopting the UDC “Enforcement” Chapter 18.50 the county commissioners intended it to apply only to one tiny sliver of land use law dealing with conditions of plat approval, and intended to leave all other provisions of Titles 17 and 18 unenforceable, is patently absurd.

III. Resolution

As explained above, we believe it is perfectly clear that PLA’s commercial timber harvesting within the Port Ludlow MPR was and is illegal and in violation of the Development Agreement. However, we understand that PLA may feel just as strongly that it had and has every right to harvest trees on any property it owns. It is not necessary for PLA to agree with us or the county about the illegality of the timber harvesting in order for the parties to reach an agreement on how to resolve the dispute and make a stronger resort community. As you well know, parties settling a dispute almost never admit they did anything wrong or agree that the other side’s position was correct. They simply agree to a course of action that makes the dispute go away. As most lawyers will agree, settling a business dispute is almost always better than litigating it. A settlement eliminates the risk, expense and distraction of litigation and allows a businessman to get back to running his business. A settlement that leaves both sides to a dispute in a better position than they had before is especially desirable.

We think that kind of settlement can and should be reached here. We think that a settlement having the following elements should be acceptable to the county and would be embraced by the community as a huge stride forward toward forging a healthy “partnership” relationship between PLA and the residents of Port Ludlow:

  1.  Agreeing that there will be no further commercial timber harvesting within the Port Ludlow MPR, except for the purpose of converting the treed land to an expressly permissible use under the MPR zoning code:
  2.  Screening the visual blight and remediating the environmental damage resulting from the logging, to the extent reasonable and feasible; and
  3. Confirmation that any net revenues of PLA and its logger Cedarland from the logging in 2014 and 25015 have been used for the screening and environmental remediation or will otherwise be used for the benefit of the Port Ludlow community.

We understand that PLA is already in the process of trying to determine what would be involved in dealing with the second of these three elements. We suspect that the amount of PLA net revenues from the logging after screening the visual blight and addressing the environmental damage would be substantially less than the cost of litigating the dispute. As to the first element, we believe the benefits for PLA of improving the partnership between PLA and the residents and making a stronger resort community would far outweigh any conceivable profits from additional logging.

We believe a settlement along these lines would allow PLA, the county, SBCA, LMC and PLVC to announce to the public that an agreement has been reached that resolves the dispute and forges a new and improved “partnership” between PLA and the residents that will make Port Ludlow an even stronger resort community that lives up to iits motto  as a lovely “Village in the Woods by the Bay.”

Sincerely,

Dave Jurca, chair –  Ad hoc Committee for SBCA                                                                 Dave McDearmid, chair –  Ad hoc Committee for LMC                                                       Bill Dean, chair –  Ad hoc Committee for PLVC

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