Jack Scott Farms, Inc. v. Dept. of State Lands

A jurisdictional determination by a state agency must be supported by substantial evidence and substantial reason under ORS 183.482(8).

Petitioner petitioned for judicial review of a final order from the Oregon Department of State Lands (DSL), which asserted regulatory jurisdiction over wetlands on Petitioner’s property under the Oregon Removal-Fill Law (ORS 196.800 to 196.990). The agency determined that a pond, an irrigation ditch, and a connecting ditch on the property were jurisdictional wetlands. On appeal, Petitioner argued DSL’s final order lacked substantial evidence and substantial reason because the agency erred in determining (1) the pond was not entirely created from uplands, (2) the connecting ditch was jurisdictional, and (3) the irrigation ditch was a regulated water feature rather than an exempt, non-jurisdictional irrigation ditch. DSL asserted its jurisdictional determination was supported by substantial evidence and Petitioner failed to meet its burden of proving the features were exempt from regulation. Under ORS 183.482(8)(c), substantial evidence exists when “the record, viewed as a whole, would permit a reasonable person to make that finding.” Additionally, under ORS 183.482(8)(a), an agency’s order must be supported by substantial reason, meaning it must articulate a rational connection between the evidence and its legal conclusions. SAIF v. Coria, 371 Or 1, 12, 528 P3d 785 (2023). The Court found DSL’s final order met the substantial evidence and substantial reason standard because the agency’s determination was based on expert testimony, historical data, and regulatory definitions, all of which supported the conclusion that the pond was created from a pre-existing wetland, the connecting ditch was part of the jurisdictional wetland system, and the irrigation ditch was not an exempt feature. The Court held that DSL properly exercised its regulatory authority over the wetlands on Petitioner’s property. AFFIRMED.