Oregon's Land Use Board of Appeals on Wednesday rejected Portland's limits on the expansion of fossil fuel infrastructure in the city, saying the ordinance violated the commerce clause of the U.S. Constitution.

The ordinance was passed last December and was the signature legacy of Portland Mayor Charlie Hales. The ordinance was born after the city decided against making zoning changes to accommodate a $500 million propane export terminal proposed by a Canadian energy company, Pembina Pipeline Corp., at the Port of Portland's Terminal 6.

Hales originally supported that project, but reversed course after a groundswell of public opposition that focused on the public safety, environmental and climate change impacts of large fossil fuel facilities.

The Portland Business Alliance joined fuel suppliers to appeal to the state Land Use Board of Appeals. They cited a number of grounds for the appeal, but Wednesday's decision was based on a violation of the commerce clause, which gives the federal government the right to regulate trade between states and other nations.

The city is considering an appeal to the State Court of Appeals.

"This decision is disappointing and goes against the interests of our community," according to a statement issued by Mayor Ted Wheeler. "It is incumbent upon us to protect our residents from the enormous risks posed by fossil fuels. The City is reviewing the ruling and exploring our options, including an appeal. Additionally, we will continue to work with environmental, energy, and resiliency experts to ensure Portland remains a leader on these issues."

The Portland Business Alliance issued the following statement: "We agree with the City of Portland that we should all be working together to address the issue of climate change. The Portland Business Alliance is looking forward to working with the City on next steps which are both legal and in line with the constitution."

The ordinance was a major victory for local environmental groups, which also expressed disappointment Wednesday.

"The people of Portland overwhelmingly supported this policy and strong climate action," Dan Serres, conservation director for Columbia Riverkeeper, said in a news release. "We will not be dissuaded by the fossil fuel industry's attempt to put our communities and climate at risk."



"The Portland Business Alliance should be ashamed at their attempt to undercut Portland's role as a leader in moving towards green energy and a safe community," said Micah Meskel, Conservation Field Coordinator with the Audubon Society of Portland.

"Although some of their members claim they to want to see the Paris Climate Accord upheld, the PBA chose to align itself with extreme fossil fuel interests."

- Ted Sickinger

503-221-8505; @tedsickinger

- Correction: The original version of the story said the board's decision to reject the ordinance was unanimous. It was not. Two members of the board recused themselves from the decision.