City of Happy Valley's proposed withdrawal from NCPRD

In August 2019, a jury trial was held regarding litigation between the City of Happy Valley and the North Clackamas Parks and Recreation District.

The verdict was in favor of the city. The county and NCPRD are committed to acting in the best interest of all district residents as legal options are considered going forward.
Read county’s official statement.

Overview

In June 2017, the Happy Valley City Council took action to withdraw from NCPRD and to provide their own parks and recreation services to Happy Valley residents. However, the City did not follow appropriate state law in withdrawing from the District.

On Dec. 13, the Circuit Court ruled that the City of Happy Valley improperly withdrew from the District. Read the court ruling.

On Aug. 16, 2019, a jury awarded the City of Happy Valley roughly $18 million in its claims that NCPRD had breached its original 2005 contract with the city for failing to complete certain projects. NCPRD will review its legal options to determine its next steps, including a possible appeal of the judge’s original ruling. Read the county’s official statement.

During the legal proceedings, the District has continued to maintain facilities and programming in Happy Valley without receiving a permanent tax rate from Happy Valley residents.

NCPRD will continue to make any necessary adjustments to our operations and budgets to provide the best service and value possible to our residents.

What happened at the August 2019 jury trial?

On Aug. 16, 2019, a jury trial was held following an earlier ruling that NCPRD had breached its contract with Happy Valley for failing to complete certain projects within the city. The city was seeking monetary damages – specifically the return of Service Development Charges (SDC) assessed within the city.

Because of the earlier breach of contract ruling, NCPRD was not able to argue the issue of whether the contract was breached at the August 2019 trial. NCPRD has not yet had the opportunity to appeal the breach of contract ruling.

NCPRD strongly disagrees with the earlier ruling, as it is the district’s position that it was in compliance with the agreement. Nevertheless, the August 2019 trial assumed that a breach had occurred and the jury was instructed to render a verdict for financial damages based on this earlier ruling. The jury awarded Happy Valley roughly $18 million in its claims.

Isn’t the $18 million Happy Valley’s money?

No. The City of Happy Valley sued the District for what were NCPRD SDCs, collected within Happy Valley. Though collected in the City, these SDCs were based on the District’s ordinance. These funds were not City SDCs.

Does this outcome change Happy Valley’s status within NCPRD?

No. The city remains a part of the district as a result of a separate Circuit Court ruling nullifying the city’s earlier efforts to withdraw from the parks district after concluding that the city relied on the wrong law. Happy Valley residents are still residents of NCPRD, and will continue to enjoy the benefits available to all District residents.

NCPRD and the Board of County Commissioners remain resolute that the city must follow ORS 198, the appropriate state law, if it wishes to withdraw. To date, the city has not attempted to withdraw under that statute.

What would withdrawal from the District mean for Happy Valley residents?

The City’s withdrawal from NCPRD would mean that the District is no longer the provider of parks and recreation services within Happy Valley. The City of Happy Valley would become the provider of parks and recreation services for Happy Valley residents. If this occurs, residents of Happy Valley would:

  • No longer have access to the following NCPRD programs and services:
    • Meals on Wheels
    • Transportation program
    • Emergency firewood service
    • In-home care referral services
    • Movies in the Park
    • RecMobile
  • Possibly have to pay more or have reduced access to the following programs
    • Swim lessons
    • Aquatic fitness and training
    • Older adult services
    • Adult recreation and sports leagues
    • Youth recreation and sports programs
    • Summer camps
    • Travel program
    • Drop-in activity groups
    • Special events (e.g., Daddy-Daughter Dinner Dance, Winter Celebrations, etc.)
  • Likely enjoy fewer services or have to pay more for the same services, because NCPRD has existing infrastructure and is able to provide economies of scale otherwise unavailable to the City of Happy Valley.

What would withdrawal from the District mean for NCPRD residents outside of Happy Valley?

NCPRD residents in Milwaukie and unincorporated areas of North Clackamas County continue to receive high-quality services, have access to programs and facilities and pay taxes for parks and recreation programs. However, a withdrawal of the City of Happy Valley and the City’s financial contribution to the District could:

  • Reduce the District’s ability to offer remaining residents the same high level of programs, services and facilities at current costs. The District could be in a position of evaluating specific programs and services for reduction and/or elimination, or considering increased costs to participants to mitigate the impact of this lost revenue.
  • Require a scaling down of services, staff and/or infrastructure to accommodate the lost revenue from the City of Happy Valley.

What Is Going to Happen Next?

The county and NCPRD will continue to focus on serving the best interests of all District residents. NCPRD will review its legal options to determine its next steps, including a possible appeal of the judge’s original ruling. We will post updates on this website as they are available.

What is NCPRD?

The North Clackamas Parks & Recreation District (NCPRD) is a service district of Clackamas County. It provides exceptional parks and recreation programs, facilities and services to more than 122,000 residents in a 36-square-mile area, including the cities of Milwaukie and Happy Valley, and a large area of northern unincorporated Clackamas County including Oak Grove, Jennings Lodge and more.

The NCPRD offers residents the use of more than 39 parks, 25 natural areas, 15 miles of trails, the Hood View Sports Complex, the North Clackamas Aquatic Park, the Milwaukie Center and Mount Talbert Nature Park.

Citizens voted to create the NCPRD in 1990, and Happy Valley voted to join the District in 2006. According to the measure approved in 2006 by Happy Valley voters, “City Finances alone cannot adequately fund parks and recreation.”

The NCPRD has its own permanent taxing authority, with 54 cents of every $1,000 of assessed value dedicated to providing parks and recreation services in the community.

Timeline

Aug. 16, 2019 On Aug. 16, 2019, a jury awarded the City of Happy Valley roughly $18 million in its claims that NCPRD had breached its contract with the city for failing to complete certain projects. NCPRD will review its legal options to determine its next steps, including a possible appeal of the judge’s original ruling.
Jan. 22, 2019 A judge ruled that financial damages, if any arising from an earlier ruling that NCPRD breached the contract with the city to build parks, will be decided at trial.
Dec. 2018/
Jan. 2019

NCPRD held four public meetings in December 2018 and January 2019 for people who live in the District (Happy Valley, Milwaukie and unincorporated areas of North Clackamas County) and wanted to learn how this could affect them. View the latest presentation.

Read NCPRD’s letter to residents about the meetings.

Dec. 13, 2018 The Court determined that the City of Happy Valley had not followed Oregon law when it attempted to withdraw from NCPRD. The City was not allowed to act unilaterally to withdraw, but instead must follow the process in ORS 198 in which a petition is presented to the Board of County Commissioners to start the process.
Dec. 12, 2018 A hearing is held in Circuit Court in Happy Valley’s lawsuit on the form of Order on Summary Judgment. The court takes the question under advisement to decide if, after the Court’s earlier ruling that NCPRD was in breach of the agreement, Happy Valley is entitled to damages at this time or if damages must be determined at trial in August 2019.
Dec. 5, 2018 A hearing on NCPRD’s Motion for Summary Judgment is held in the declaratory judgment action in Circuit Court on the question of whether Happy Valley’s attempt to withdraw from NCPRD was proper, or illegal and void.
Nov. 28, 2018 The Circuit Court denied a request by Happy Valley to dismiss a declaratory judgment filed by the NCPRD, Clackamas County, and the Clackamas County Assessor to decide the question of whether the City’s attempt to withdraw from NCPRD was legal.
Oct. 29, 2018 The Circuit Court denied a request by Happy Valley to dismiss a declaratory judgment filed by the NCPRD, Clackamas County, and the Clackamas County Assessor to decide the question of whether the City’s attempt to withdraw from NCPRD was legal.
Oct. 12, 2018 The Circuit Court denies Happy Valley's motion to consolidate the declaratory judgment action with the lawsuit seeking a share of the District's assets filed earlier by Happy Valley. This decision allowed for an earlier hearing on a Motion for Summary Judgment.
Sept. 19, 2018 The Oregon Tax Court rules that the Oregon Department of Revenue (DOR) exceeded its authority in rescinding approval of a boundary change sought by the City of Happy Valley during its attempt to withdraw from NCPRD. The decision invalidates the June DOR decision that rescinded the boundary approval and reinstates the DOR’s March approval of the boundary change.
June 19, 2018 Oregon Department of Revenue (DOR) rescinds approval of Happy Valley's boundary change. DOR determined that the City did not follow appropriate state law in withdrawing from NCPRD.
May 15, 2018 City of Happy Valley voters approve establishing a five-year local option levy for parks and recreation services with the same assessed tax rate as NCPRD.
Nov. 2017 NCPRD files a countersuit against Happy Valley.
Oct. 2017 Happy Valley files a lawsuit against NCPRD seeking a share of the District’s assets and substantial cash.
June 2017 The Happy Valley City Council votes to withdraw from NCPRD effective Dec. 31, 2017.

News

Aug. 16, 2019 Statement on HV/NCPRD Litigation
Dec. 13, 2018 Court rules Happy Valley improperly withdrew from Parks District
Sept. 19, 2018 Oregon Tax Court rules Department of Revenue without authority to rescind Happy Valley boundary change; No longer part of NCPRD
July 3, 2018 Clackamas County Commissioners decline Happy Valley requests for NCPRD boundary change submission, tax delay
June 21, 2018 Oregon Department of Revenue invalidates Happy Valley boundary change; City remains part of NCPRD
April 10, 2018 NCPRD status change for Happy Valley residents
Oct. 9, 2017 Clackamas County on Happy Valley lawsuit: City has ‘misguided perception’ that it is owed more than authorized by state law in withdrawal from NCPRD
June 7, 2017 North Clackamas Parks and Recreation District to transition services within Happy Valley city limits

Contact Information

Questions or comments, feel free to contact NCPRD at 503-742-4348 or info@ncprd.com, or visit their website.