The Growth Managed Death of Oregon’s Pear Farms

Oregon became a nationwide leader in statewide growth management when it passed its law in 1973 to protect farmland and open space. It turns out, an unintended side effect is the undermining of the financial viability of the state’s agricultural industry, specifically fruit farms.

Farms are unable to sell their land to underwrite their farm operations. As a result, they are going under. According to the Wall Street Journal (April 2, 2010):

“It is a paradox few foresaw in 1973, when Oregon passed Senate Bill 100. That measure, considered a landmark of the budding environmental movement, put Oregon on the map as the “greenest” of U.S. states by placing zoning decisions with a central agency, outside the purview of local authorities.

The law had a huge impact in restricting suburban sprawl throughout the state, preserving environmentally critical habitats.

But since the mid-1990s, more than 3,500 acres planted in pears have gone out of production here. From 87 pear farms operating in 1992, only 48 remain.

Three big companies here combine to operate 90% of the Rogue River Valley’s pear industry. Oregon is the second-biggest pear producer in the U.S., behind Washington. Pear cultivation produced $900 million in sales and ancillary services in Jackson County last year.”

Of course, this is the inherent problem with central planning of any kind. All human and government actions have unintended consequences. The question is which institutions are more effective and resilient in addressing these problems. Again, from the Wall Street Journal story:

“Land-use issues have defined Oregon politics for a generation. A tug-of-war among voters over what brings a better quality of life—healthy industry or a pristine environment—colors everything from how much Columbia River water can be dammed during salmon runs to whether timber harvests should be subordinated to protect the spotted owl.

Already $10 million in debt, Associated Fruit faces a crisis, Mr. Lowry says as he strolls through an orchard first planted by his family 75 years ago. The parcel, which abuts a housing development called Phoenix Acres, would fetch $100,000 per acre if the Lowry family could sell it to a housing developer, he says.

Selling the 70-acre orchard would raise $7 million, Mr. Lowry says, enough to refinance Associated Fruit’s debt, with plenty left over to plant new orchards on land further from Medford’s core. Instead, the land is valued at just $10,000 per acre, he says, a moot point since there are no takers.

“There’s a huge amount of land, either fallow or in low-value crops like hayfields” Associated could acquire and replant in pears, the 65-year-old farmer says. But, unless he can raise the cash to move, he may lose everything.”

But, that really isn’t a problem for many in Oregon now, regardless of the original intent of the growth management law. In the case of Oregon’s law, the primary environmental goal is now really about preserving as much open space as possible, regardless of the impact on the built environment or, as we are seeing, the agricultural industry. So, its no longer about farmland preservation, or preserving the agricultural industry. It’s about containing urban growth.

More from Reason Foundation on Oregon’s growth management laws can be found here (urban growth boundaries) and here (housing affordability).