Oregon Magazine
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Court Zaps Urban Renewal
  By Fred Delkin 

 Can there be any city on earth that has adhered more to the shibboleth of "Urban Renewal" than Portland, Oregon?  The Rose City’s devotion to this cause began with the creation of the Portland Development Commission in 1958.  That august body has since presided over the planning and financing of seminal changes in the urban landscape…some good, some not so good, and some beyond financial practicality.  The latter negative has been predominant in the past decade.  A visit to the PDC web site offers a tribute to Portland’s most profligate politician: "...the one person who has been a strong voice and committed supporter for urban renewal…Mayor Vera Katz."
  Vera Katz Memorial Cyber Viewpoint and Rest Area - Enter here

(Official photo is a hotlink to her page)
Commissioner of Finance and Administration
1221 SW 4th Ave, Room 340, 97204
(503) 823-4120
e-mail: mayorkatz@ci.portland.or.us
  Vera Katz Memorial Cyber Viewpoint and Rest Area - Exit here

Yes, the same spendthrift who promotes covering downtown freeways, building an under-utilized streetcar line, the financial fiasco of PGE Park…who has presided over expensive mismanagement in her city’s water and police bureaus and hides from taking any leadership or responsibility for the recent and costly troubles in finding an effective schools superintendent…and who worships at the altar of that overwhelming leader in public projects’ expense, light rail…all the while bemoaning the lack of dollars for police, fire protection and adequate education for our children. 

Blowing the whistle

We hasten to state that urban renewal can be a good thing when it is allowed to operate free of political deceit and doesn’t place an inordinate burden on the taxpayer.  The latter sin has just resulted in a taxpayer’s successful revolt against the Portland Development Commission’s conspiracy with the Katz regime to funnel tax dollars to purposes unrelated to those prescribed by state law…light rail being a salient example. 

The state supreme court has slapped stolen dollars from the PDC’s hands with a December ruling that upheld that taxes paid by a private business (Shilo Inns) located in an urban renewal district (Airport Way) were collected in violation of the 1990 state Measure 5 property tax limitation.  The Court decision requires tax refunds and demonstrates that tax dollars have been used to fund pet political projects without voter approval, while drawing resources away from schools…whereas a primary purpose of Measure 5 was to limit the level of property tax levied and dedicate a substantial share of taxes collected to the public school system. 

Can it be any surprise that local government has been collecting tax dollars claiming the money was going towards schools, while knowing full well the bucks would never be used for education?  Shilo Inns’  attorney, Greg Byrne, states that "urban renewal skews the property tax system."  Byrne says dollars siphoned from property taxes for urban development represent
"…money that otherwise would pay for schools, police protection, parks and social programs."  Byrne submits that "urban renewal diverts a substantial amount of tax revenue… "(dollars) more crucial to livability than the bricks, mortar and rails that urban planners promote." 

The good and the bad

The PDC’s first major effort was the South Auditorium Project.  This was supposed to replace a long-standing low income residential and small business community with a vibrant high rise bloc dedicated to business and apartments. Banished was the ethnicity and charm of the original Jewish and Italian neighborhood, replaced by a concrete bastion with no esthetic appeal and lack of street access.  It did bring citizens the Forecourt Fountain, dedicated to the first PDC director, Ira Keller, a successful industrialist and powerful voice for urban modernization. 

Several subsequent PDC-promoted projects have contributed substantially to both Portland’s livability and its economic health.  Among these, we include Waterfront Park, Riverplace, Pioneer Square and Place, Performing Arts Center and the Convention Center…each with substantial contributions to both the economy and the urban environment.  PDC kicked off, in 1966, the effort to create the current Portland State University campus complex that borders on the ultimate use of inner urban space.  Another rewarding PDC effort was creating a renewal designation for a swampy piece of Willamette riverside that became a home for the German high tech firm, Wacker Siltronics.. 

Riding the rails

Then there’s light rail.  Neil Goldschmidt (third from the right in the governor's day rogue's gallery, below) became Portland mayor in 1973, espousing a focus on transportation enhancement that created the Portland transit mall, the launching of light rail and carried the mayor to Washington D.C. as federal Transportation Secretary.  Goldschmidt’s disciple, Ms. Katz 

has since ignored virtually all other fiscal priorities (and legalities) to fund a tax dollar-gulping Tri-Met empire.  The initial light rail route, Portland to Gresham, today carries only 10% as many people as the same length of I-84 freeway. The next light rail link, Portland to Hillsboro, has even less usage.  PDC, meanwhile,  proceeded to pungle up money to create the Interstate Urban Renewal district which features another rail extension, meanwhile creating traffic and business disruption greater than its predecessors. 

The newly-opened Max rail line addition to Portland Airport gets our nod as a possibly practical use of this costly transportation medium.  Costly? The investment of $100 million per mile was estimated as the expense for creating a light rail south/north route between Clackamas and downtown, and proponents have admitted that operation of this line would cost $15 million more per annum than running buses.   Voters, sensing the reach for their pocketbooks, turned this addition down.

The Katz administration’s love for light rail generated a totally unecessary loss to the city’s economy when it forced Columbia Sportswear (one of the state’s most successful businesses and an international symbol) to move to the suburbs.  This came about because a PDC redevelopment area on the downtown east bank of the Willamette was established as a home for OMSI (Oregon Museum of Science & Industry), leaving  substantial desirable acreage with a rail link as yet undeveloped since being cleared. Why?  Because Columbia proposed to occupy space proposed by PDC as a light rail station and thus protected by Katz and cronies as off limits for private development…the type of development that generates dollars instead of spending them.  (Photo is a hotlink to a page that explains how to ride a lightrail train.)

Eugene follies

Urban renewal has been a vehicle in these United States that too often carries dreams rather than reality.  Ask the good citizens of Eugene, who allowed civic planners (read "dreamers") to close the core of downtown to vehicle traffic some 30 years ago.  The resultant pedestrian mall devastated downtown business.  Just last month the Eugene city council took a final step in rehabilitation by approving another $4.2 million to erase the last vestige of street closures.  (OMED: The PDC just spent $250,000 for a survey that said the Meier&Frank building should be left in downtown, and that the removal of automobiles from the core area isn't a good idea.  A fifty-cent phone call to Eugene would have provided that information.)

Get honest, folks!

When Shilo Inns’ legal protest got court sanction, it cast light unwanted by civic politicians on the latter’s funding schemes.  The judge’s decision on this case placed emphasis on adhering to the purposes for which taxes are dedicated (such as schools).  Measure 5 was a voter statement that politicians must be up front about what they do with taxpayer dollars.  The Shilo case reaffirmed that dishonesty or obfuscation by political spendthrifts will be apprehended and punished. 

Now our happy civic schemers are wringing their greedy hands over having to delay no less than 70 projects in 10 urban renewal districts, and they may face refunding up to $30 million to property owners in these districts. 

However, the PDC is still struggling to find another source that ultimately impacts the taxpayer.  The Portland Tribune reports that PDC is "sending two staff members to Washington D.C. to investigate a federal tax credit program that could potentially replace money lost in a recent tax court decision.  The U.S. Treasury Department plans to distribute $2.5 billion in "credits for economic and business development nationwide," and PDC director Don Mazziotti is quoted as saying these credits "look like a promising source of funding for projects." 

It’s not easy to discourage the folks on the public payroll from spending your hard earned dollars!!

                                          Related article: 
 Portland Tribune:  Renewal is in, but renters are out 

Text (C) 2002 Oregon Magazine   Photos from the PDC, MAX and city hall are links.

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