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Tuesday, February 24, 2004

Time to fold

Sometimes when I play video poker on my home computer, I lose some money (all pretend money, of course, with my little home program). But I'll keep playing and playing, sometimes until all hours, trying to win it back. I forget Kenny Rogers's admonition, "You got to know when to fold 'em." By the time I give up, I'm just as far behind as when I should have quit, if not more so. Plus, I've wasted a lot of time, and I'm exhausted to boot.

The City of Portland has been behaving exactly the same way in connection with the Oregon Convention Center, and there's no sign it's going to call it a night any time soon.

Just yesterday we hear that, it's official, no one's going to build a large flagship hotel near the Convention Center unless the city's taxpayers pay a good chunk of the construction cost. And of course, the City Council and its slush fund, the Portland Development Commission, are hard at work figuring out how to raise those tax dollars and get the hotel built.

What a crock. As I've argued on this blog at least once before, the Convention Center was a flop when it was smaller, and it's an even bigger flop now that the city has paid $116 million to double its largely empty space. That expansion never should have taken place until the hotel issue was settled, but Vera, Erik & Co. ran right out and spent tax dollars to build it, despite a clear mandate from voters that they didn't want it.

That misstep came along with the renovation of Civic Stadium -- tens of millions spent on luxury boxes and the like, for minor league baseball and funky league soccer. All of which has led to a string of fiscal disasters for our cash-strapped city.

Together these are among the worst public financing decisions in the city's history. Sure, the commissioners will tell you that the wasted money is all coming out of the hotel-motel tax, which is paid by tourists. But that's the same malarkey they'll try to sell about how the hotel is going to be built from "urban renewal" funds. There are "different pots of money," "different colors of money," and we should focus on the pots and the colors, rather than on the fact that it's all coming from us taxpayers.

Call them out on it. Those are all tax dollars that should have been spent on public safety and schools. We didn't need a larger white elephant Convention Center, and we don't need a white elephant hotel on top of it.

Portland's never been a good convention city, and there is a very good chance that it never will be. It's time to fold 'em while we're only down $116 million.

Regardless of how the hotel financing goes, I think we ought to name the new wing of the Convention Center after Mayor Katz. It's quite the symbol of her tenure, which, mercifully, will be ending soon: very, very expensive, and mostly empty, most of the time.

Comments (9)

Amen, brother Jack.

If a convention center hotel made economic sense, someone would have built it by now.
The Laquedem Solution:
(1) Designate the Lloyd Center Doubletree as the "convention center hotel." It's one MAX stop (1000 feet) away from the convention center. It has 476 rooms, within shouting distance of the 600 rooms that the City wants in a CC hotel.
(2) Let the Doubletree build 124 more rooms on an adjacent block, with a skybridge and tunnel to connect to the existing building.

Now we have a 600-room convention center hotel. Lots cheaper than starting from scratch!

In addition, the Hilton, Heathman, Embassy Suites, and many others downtown are a five-minute MAX ride away from the Convention Center -- enough room to hold any sort of convention that Portland could plausibly play host to.

What? Ask people to ride the MAX for five minutes? How plebeian. They might be exposed to Portland's poor people.

But that's the same malarkey they'll try to sell about how the hotel is going to be built from "urban renewal" funds. There are "different pots of money," "different colors of money," and we should focus on the pots and the colors, rather than on the fact that it's all coming from us taxpayers.

Call them out on it. Those are all tax dollars that should have been spent on public safety and schools.

Unfortunately, it doesn't work this way. There are, in fact, different pots/colors of money. Projects in urban renewal areas are paid for through proprty tax increases that would not have occurred without investment which prompts growth and development. Meaning: The money paying for those projects doesn't exist for general fund purposes, and therefore simply can't go to pay for other things, such as safety and schools.

That doesn't mean that all URAs or projects in URAs are the proper thigns to do. But it does mean that the money wouldn't be there at all for other purposes, so it's simply inaccurate to speak as if it could be used for, say, safety or schools instead of some URA-based development project.

Some of Katz's (ot the Portland Development Commission's) priorities may be off the mark. But she is nonetheless correct when she speaks of different color of money, no matter how much it may irritate her critics to hear it.

I agree with you, Jack, and I acknowledge that blX is also right. How can I reconcile that?
Well, in my mind it is simple.
Somehow, after twenty some years of "smart growth" I think things have gone terribly astray.
I think city government has gotten too far afield from the core functions of government. Market forces, not market manipulation, should drive development. Time and time again I have stated that the city should quantify the return on investment of these development projects. They can't and they won't, because they don't pencil out. If there are profits to be made through development, business interests will recognize it and make the proper investments. Some will argue that this will cause "uncontrolled development" (that's mostly from the 'business is evil' crowd), but that's what zoning is for. The city government's job is to provide fire and police services, water and sewer services and to enforce licensing and codes. The fact is, that part of their job is not sexy, not very exciting and they are bored by it. It's much more fun to play "sim city". Also, if, as an elected official, you are not driving development schemes, it becomes difficult to return campaign contribution favors from big developers. What they really ought to do is dissolve the PDC, take the money saved to abolish the business income tax, and create an environment where people can get back to work in this town.

Sorry, Bix, but the "pots" and "colors" are largely, if not entirely, accounting baloney.

First of all, the hotel-motel tax could have been used for anything the city wanted to use it for, including schools and public safety. It just isn't, because the City Council decided it shouldn't be.

As for "urban renewal" money, as I look at my property tax bill, 7.54% of the money I pay -- all green, all coming out the pot known as my checking account -- goes to something called "Urban renewal - Portland." I do not live in an urban renewal zone. There hasn't been a new building built anywhere near my house in probably 50 years. That money should also go for schools and public safety. Instead it is going to the Vera Katz Theme Park. Moreover, many beneficiaries of the Theme Park amusement rides (e.g., the streetcar) don't pay this tax, because the property taxes on their ugly highrise boxes are forgiven for a decade or more.

Dave Lister wrote: "The city government's job is to provide fire and police services, water and sewer services and to enforce licensing and codes."

I thought its job was to help fund projects for the clients of Uncle Neil, but I may be missing something.

Actually, Uncle Neil's funding comes from invested PERS retirement money by way of his wife, Diana.

There is at least one local con that is too big for current Portland facilities. It takes place every November at the Doubletree Columbia River, which doesn't really have enough function space and so the program is somewhat curtailed, and membership is limited to 1600. This con has sold out all but 1 of the last 10 years, and would like to grow, but there's nowhere else in Portland to go to serve the least, not a rate they want to accept. The room rates have been below $100 for a standard room, and the group is not very price elastic.

It's Orycon, the Oregon science fiction convention. Last fall was the 25th annual Orycon.


Listed below are links to weblogs that reference Time to fold:

» Urban Renewal Areas And Those Pesky Colors Of Money from The One True b!X's PORTLAND COMMUNIQUE
Elsewhere, Jack Bogdanski has a rant against the Convention Center, in which he hits upon some more general points we feel are important to discuss. Those of you who already have read the item will... [Read More]

» Property Taxes And The 'Urban Renewal Special Levy' from The One True b!X's PORTLAND COMMUNIQUE
As it happens, while perusing the Portland Development Commission's answers to questions about urban renewal raised by the City Council during its (continuing) consideration of extending the Downtown Waterfront Urban Renewal Area, we finally discovered... [Read More]

» Urban Renewal Areas And Those Pesky Colors Of Money from The One True b!X's PORTLAND COMMUNIQUE
Note: This post has been updated. Any and all updates appear at the end of the original post. Elsewhere, Jack Bogdanski has a rant against the Convention Center, in which he hits upon some more general points we feel are important to discuss. Those of ... [Read More]


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