Governor Kitzhaber signed two bills that allow Oregon wineries to host commercial activities. HB 3280-B specifically applies to commercial activities for wineries located on land zoned for exclusive farm use, while SB 960 applies to all agricultural enterprises located on land zoned for exclusive farm use.
History of Commercial Activities on Exclusive Farm Use Land
Since the 1970s, Oregon’s land use laws have generally prohibited any commercial activity on land zoned for exclusive farm use (EFU). The statute provided an exception for “commercial activities in conjunction with farm use.” In fact, the first wineries and tasting rooms located on EFU land were approved as a “commercial activity in conjunction with farm use” until ORS 215.452 and 215.283 were amended in 1989 to make wineries a permitted use. A conditional use permit was generally the only way to obtain approval for commercial activities until 2010 when SB 1055 was passed in response to Marion County’s attempts to shut down commercial activities at a local winery. SB 1055 was passed quickly and quietly and without much input from the winery industry or other interested groups. The primary sections of SB 1055 were only effective until December 31st, 2012, prompting the industry and other groups to begin to craft permanent legislation on this issue.
HB 3280-B and SB 960
HB 3280-B and SB 960 were drafted to replace SB 1055. HB 3280-B affects only wineries located on EFU land and that have an on-site vineyard of at least 15 acres, or own or lease a contiguous vineyard of at least 15 acres. SB 960 affects all agricultural enterprises located on EFU land, not just vineyards and wineries.
As noted above, HB 3280-B only affects wineries located on EFU land and have an on-site vineyard of at least 15 acres, or own or lease a contiguous vineyard of at least 15 acres. HB 3280-B does not affect or benefit wineries with less than 15 acres of vineyard. All wineries addressed under HB 3280-B are allowed unlimited activities “conducted for the primary purpose of promoting wine produced in conjunction with the winery.” This includes, but is not limited to wine tastings, wine tours, and wine clubs. Wineries can also market and sell items directly related to the sale or promotion of the wine, including the sale of food and beverages in pre-packaged form.
All wineries are now also allowed twenty-five (25) event days for “private events, hosted by the winery or patrons of the winery.” These type of ‘events’ are not clarified, but it is believed that this provision is intended for charity dinners, birthday parties, or other events where catered food is served. Wineries may also get permission for outdoor concerts, facility rentals or celebratory events (e.g., wedding receptions) as part of their 25 event days if the county where the winery is located had previously allowed such events. The gross income from the incidental events and commercial activities cannot exceed 25% of the gross income from on-site wine sales.
Additionally, HB 3280-B allows the largest of wineries the ability to establish a full-service restaurant with the winery. In order to be able to establish the full-service restaurant, the winery must: (1) be sited on a minimum 80-acre parcel with at least 50 acres planted as a vineyard; (2) own an additional 80 acres of planted vineyards anywhere in Oregon; and (3) produce at least 150,000 gallons of wine in at least three of the previous five years before establishment of the restaurant.
HB 3280-B also grandfathers all lawfully permitted uses and activities that existed prior to the enactment of the bill.
SB 960 was sponsored by the Association of Oregon Counties and the Oregon Farm Bureau, and allows “agri-tourism and other commercial events or activities that are related to and supportive of agriculture” on EFU zoned land. Such commercial events or activities must be “incidental and subordinate to existing farm use” on the property, shall not exceed 72 consecutive hours in duration, limit attendance to 500 people, and limit parking to 250 vehicles. SB 960 provides counties with the ability to approve such commercial events as either a single event, up to six events in a commercial year, or up to 18 events in a commercial year. Additionally, SB 960 allows the county to approve a single event on an “expedited” basis, provided that such an event that is “incidental and subordinate to existing farm use,” occurs between 6 a.m. and 10 p.m., and is limited to 100 attendees and 50 vehicles. Approval of the expedited single event would not be considered a land use decision as defined by statute. All other event approvals would be through a local land use process.
The approvals allowed under HB 3280-B and SB 960 would be specific to the property owner, and would not transfer with a sale of the property or business.
HB 3280-B and SB 960 provide wineries and vineyards with some certainty regarding commercial activities and events designed to promote the sale of wine. However, many of the activities allowed under HB 3280-B are for a limited duration, as the bill is intended as a test to see how compatible the commercial activities are with surrounding agricultural uses. As relevant provisions of HB 3280-B will expire in just over two years, the industry and special interest groups will be examining this issue again shortly. Industry members will do well to monitor their peers and make sure that everyone is doing their best to be cognizant of neighboring agricultural uses. Otherwise, the bad or selfish actions of a few could cause the revocation or further limitation of commercial activities and events when HB 3280-B expires.