CANNON BEACH - Issues with private property rights dominated the Cannon Beach City Council meeting Tuesday, with city ordinance exceptions, the vacation rental ordinance, annexation and Measure 37 under discussion.

In general, the council was cooperative with citizens' wishes.

Two citizens received exemptions to previous land-use decisions, and another was able to purchase property from the city. But on one issue, the council did not waver. Members aren't changing the rules for renting homes to tourists.

The council voted 4-1 to allow Michele and Mike Johnson to increase the size of their building envelope - the specific space on their property where the city will allow them to build. A condition of the increase is for the Johnsons to protect nearby trees. The Johnsons' lot is one of six in the Tolovana Woods subdivision on Tanana Avenue. The Planning Commission decided on an envelope for each of the six properties in 1997 as a condition of allowing construction. Commission members at the time were concerned with protecting wetlands and trees. The commission upheld the decision in a June 23 meeting, and the Johnsons appealed to the council.

City Planner Rainmar Bartl agreed with the Johnsons that their expansion plan would not harm the wetlands or the trees on the property. He said the commission denied the Johnsons' application because the building envelope was in place when they bought the land.

Councilor Jay Raskin voted against the council's decision to overrule the commission. "There is absolutely no compelling reason," he said. "They actually bought this property knowing this was the boundary." He said the council should change Cannon Beach's zoning ordinance to have a standard for when a change can be made in a building's setback from the road or in an envelope.

Mayor Dave Rouse said envelopes should be considered on a case-by-case basis, unlike setbacks.

"The original footprint that was designated for the site may or may not have been adequate," said Councilor Tevis Dooley. "Until you get in there and actually work with it, you don't know." He said he felt the intent of the Planning Commission's original decision was met.

Joan Holden received a waiver in a unanimous decision from the council that will allow her building to remain where it extends into North Spruce Street. Bartl said the city can require removal of the encroachment at a later date if desired. He said the encroachment is minimal and will not affect city interests. It involves a substantial section of the building. "To actually remove that part of the structure would be fairly expensive," he said.

Proponents of the annexation of land north of Cannon Beach also won a victory as the council formally approved the annexation 4-0. This included waivers of Measure 37 rights by the four property owners who signed the petition requesting annexation. Raskin abstained because of a conflict of interest. The eight properties north of Sixth Street between Ecola Park Road and U.S. Highway 101 had been approved for annexation at the July meeting subject to a staff report.

Nancy Bosse won the bid on the city-owned Seal Rock Beach lot on Hemlock Street north of Seventh Street with $149,500. A condition was that Bosse combine the property with the eight surrounding lots she recently purchased. Other bids were submitted, but Bosse was awarded the bid because of her promise to combine the lots.

Bosse said in her application that the combined lots would meet the city's one-acre requirement for that area. She said the previous lots existed before the requirement was made. Bartl said outside the meeting that it is a city goal to combine lots in that area to create one-acre minimums to deal with steep slopes, stream and wetland issues.

But the council's cooperative mood ended at a request to change the vacation rental ordinance, which allows holders of permits to have guests every 14 days. Any citizen of Cannon Beach can obtain a vacation permit, unlike the 92 short-term rental permits, which allow holders to rent as often as desired. Citizens John Backes and Robin Roberts had requested relatives and non-paying guests be allowed to stay during the same 14-day period as paying guests.

"It would make enforcement probably very close to impossible," Bartl said. "Folks would just have to say they're non-paying guests."

Councilor Carmen Swigart said she did not want to interfere with the compromise reached with the vacation and short-term rental ordinances.

"If you accept that you're going to operate a business, you accept the regulations that go with that business," Rouse said.

• Voted unanimously to retain PGP Valuation Inc. to do an independent appraisal of David Holland's property east of Hemlock Street and south of Arbor Lane. Holland filed a $3.1 million Measure 37 claim stating that at the time he bought his property in 1973, he would have been allowed to subdivide it into 20 lots. City Attorney Bill Canessa said an independent appraisal would help the city make a decision on the claim. Since Holland did not submit an appraisal, Canessa said the council has no way to judge the accuracy of the $3.1 million figure. The appraisal is estimated to cost $7,500;

• Approved the Cannon Beach Arts Association grant for $10,000 in a 4-1 vote, with Swigart opposing. The grant was held from the July meeting due to an application that was not up to standard

Swigart said she was still not satisfied with the paperwork. She said she wanted to see more documentation of how the city's previous grants were spent.

"If we subjected all of the applicants to the same degree of scrutiny, we'd find some flaws there as well," Dooley responded.

Rouse said the city should reconsider issuing grant money before the recipient is ready to spend it, citing a $1,000 grant that has not yet been spent by the Arts Association. He said he was concerned the city is not making sure its grant money is spent appropriately;

• The council voted 4-1 to purchase a parcel of land bordering Ecola Creek from the Weyerhaeuser Company for $1,500. Dooley asked what benefit buying the land would have to the city. Bartl said the city could make sure the area was not logged and possibly conduct Coho salmon restoration. Dooley voted against the purchase;

• The council unanimously renewed an intergovernmental agreement with Tillamook County and the Oregon Water Resources Department to monitor discharges from the wastewater treatment plant.