PDC and City Council sessions on the Eastside Streetcar
Well, it turns out I was wrong on several items in my post yesterday on funding the Eastside Streetcar. Mostly, in that it appears the deals have already been done.
Here’s what I learned last night, from watching the last part of the repeat cablecast of the 8/8/07 Portland Development Commission (PDC) hearing – a meeting that lasted over four hours:
1. A staff person told the Portland Development Commission board that “Council will vote on September 7 to allocate $27.4 million of tax increment money to provide part of the $75 million local match for the federal money.” It turns out the date was incorrect – Council will vote on September 6. But the emphasis was on the word WILL – apparently there is no question that there will be three votes for the project.
2. The federal money is almost certain.
3. In committing to the local match and submitting the report for the federal money, there is no future opportunity to rethink whether the Streetcar project makes sense.
4. The three Urban Renewal Area Citizen Advisory Committees have had limited (no?) opportunities to weigh in on the $27.4 million allocation being decided by Council.
5. The Portland Development Commission board members seemed to be hearing the details for the first time last week, on August 8.
Some comments from PDC Commissioners:
“Are we sacrificing everything other than housing and transportation to fund this project?” – PDC Board Chairman Mark Rosenbaum. It was a rhetorical question – nobody knows what will not be done if more tax increment money goes to the Streetcar than other projects, because the URA Advisory Committees that help PDC set funding allocations haven’t been consulted about the diversion of funds for the Streetcar. Mark said, “I’m trying to envision a process that will allow our URA Advisory Committees to look at where to find $27 million.” With a timeline of the Council vote scheduled on September 6, it seems highly unlikely any such process is feasible.
“I’m concerned about gentrification, and what happens if we don’t have development money to put in at the same time. We allow many years of market rate increases to occur.” i.e., pricing out existing residents on the inner Eastside if we pay for the Streetcar and don’t have money left over to help counter the resultant demographic shift.
Neither of these concerns were reviewed by the participants in this morning’s Council work session. Here are my notes from watching that meeting on cable:
(Present: Mayor Potter, Commissioners Leonard and Adams, Brendan Finn – Commissioner Saltzman’s Chief-of-staff, staff from the Portland Development Commission (PDC) and Portland Office of Transportation. And a TriMet staffer.)
Editorial comment: I am VERY distressed that no PDC Commissioners participated. One would have hoped that with all the time they put in volunteering on the Commission, the Council would ask for the PDC Board’s advice on these huge expenditures and potential impacts to Urban Renewal Districts.
* Sam Adams said all the cost estimates are “low confidence”. He noted all the Streetcar projects have been done on time and under budget so far, but this one is longer and involves crossing the river. If preliminary engineering studies show the project can’t be done for the current $146 million estimate, the options will be to shorten the route or go back to Council for more money. Mayor Potter: “Would we get less federal money if we have to cut the length of the route due to cost considerations?” Sam: “Probably not.”
* Randy Leonard clarified that increased cost would mean more citywide Systems Development Charge money. The amount coming from the Local Improvement District to be voted on tomorrow is fixed at $15 million, with only 10% contingency.
* Planned Tax Increment Fund (TIF) money from the Urban Renewal Areas (URAs) targeted:
River District – $17 million. $2.5 million currently budgeted.
Oregon Convention Center – $4 million. $2.5 million currently budgeted.
Central Eastside – $6.2 million. $4 million currently budgeted.
These numbers represent less proportion of TIF than the westside Streetcar segments.
* A study estimates the Streetcar will generate $54 million in extra tax increment money in the Central Eastside by promoting adjacent development; that it will pay for itself and provide $1.65 million additional tax money over ten years.
* Randy Leonard mentioned the tram construction was overseen by a committee rather than a point person. The Streetcar project will be overseen by the Portland Streetcar Inc., committee. Sam said the Council has the final call.
* Mayor Potter: “When did the Council decide to start contracting out projects like this to advisory boards?” Project management would be vested in Portland Streetcar Inc., rather than the City. Sam’s response: “I’m the one responsible to voters, subject to Council review”.
* The bridge for the Streetcar river rail-line crossing will be Streetcar only. Adding bike and pedestrian access would add $3.5 million to the cost. Randy expressed interest in finding funds for this use.
* The River District is currently collecting $18 million per year in TIF money. Centennial Mills, Burnside-Couch couplet (could take $40 million), Post Office (“possibly moving up to the airport”), and providing new facilities for the Mounted Patrol, already have calls on that money, also Union Station (currently in the Downtown Waterfront URA, apparently slated to move into the River District). Total cost for desired projects in the River District, without the Streetcar extension, exceeds $200 million – more than can be funded under its current debt limit.
Editorial comment – major waffle in response to Commissioner Leonard’s question of whether there’s capacity to add more projects. Staff mentioned that deciding whether to increase the maximum indebtedness is the first question to be decided. Then they said there is plenty of capacity so Council doesn’t have to choose between competing projects. That’s not what the Portland Development Commission heard and said last week.
* The Convention Center URA increase of $1.5 million “can be absorbed by the district” in its contingency budget, per staff.
* The Burnside Bridgehead project “may need more resources and will be delayed at least a year” ~ staff
* Sam: “If there’s more one-time money available in the General Fund in future years, we could loan it to the Central Eastside district to pay for seismic upgrades and such things, to put more money into the district now and then get it back.”
* “There’s no money for developing the Washington-Monroe High School site for a community center, even now.” ~ staff. Great question from Mayor Potter – “Why isn’t the school district responsible for the developable part? Why are we the Sugar Daddy?” – referring to staff saying PDC will likely be asked to help make the homes affordable on the part Portland Public Schools retained.
Editorial comment – the discussion morphed from this point, to multiple other issues, without members of the Council having voiced their opinions on the big TIF funding decisions, including expanding districts, increasing their maximum debt load, or extending their timelines. If the Council moves forward with promising the $27.4 million to the Streetcar extension on September 6, all of those other changes pretty much have to happen, to make it work.
* Mayor Potter asked great questions throughout the worksession. “How long does it take to get from NW to the end of the Streetcar on the Westside?” A – 35 minutes, with 40 stops. “The Streetcar is not intended for speed, it’s for the ease of access of adjacent uses.” ~ staff. Mayor Potter asked what about stopping every other stop, to reduce the time? A – People won’t walk an extra block, that would reduce ridership.
* Sam Adams: “It’s time to check in on Fareless Square and how that is working or may need to be modified.” Mayor Potter noted it’s not really Fareless, it’s only fareless for some passengers, plus the City of Portland and TriMet subsidize it. He agreed it’s time to re-evaluate what’s working and what needs to be changed.
* Bus routes 6 and 70 would be combined, i.e., passengers would have to transfer when route 6 ends earlier than it currently does. Truncating route 6 would save TriMet $470,000 which would be redirected to route 70.
* Mayor Potter (who by this point was my hero in this discussion), regarding using parking meter revenues to help pay for stuff: “I have to ask – a similar methodology was used to generate revenue estimates in South Waterfront for the tram, and they never materialized, did they?” Sam: “The Mayor is right.” He and staff continued by explaining South Waterfront is a new district so projections were more uncertain. The current plan will use parking meter revenues from the Lloyd District and other existing areas. But the meters don’t start paying for themselves for about 5 years. Mayor: “So the revenue would come from some other source for five years?” Staff appeared to fudge the response, saying they believe the revenue will come in.
* TriMet’s staffer said the Council should change the zoning to allow more residential in the Industrial Sanctuary – their Board says more residential capacity is needed to make the transit work, like in the Pearl. Sam responded that his commitment to the Central Eastside businesses is not to change the zoning.
Required additional actions: Extending/expanding the debt in the River District and “possibly” in the Central Eastside and Convention Center. “Working with OMF to address the cash flow issue in the Central Eastside” Translation: looking to the Office of Management and Finance to get some General Fund money, perhaps as a loan, to help provide stuff in the Central Eastside to give this project more chance of working.
The Council vote to commit all the funding is scheduled for September 6. Sam sounds like he thinks it’s a done deal.
Projected start of construction: September 2008.
Editorial comments: Very few of the tough questions asked by PDC Commissioners when hearing most of this information last week, were asked by the Council or addressed in the presentation at their worksession this morning. The Council wasn’t presented with concerns/questions about what won’t/can’t be done in the three Urban Renewal Areas being asked to carve out new chunks of money for this project. Staff implied everything could be funded, as well as the Streetcar extension. The fact that the PDC Commission has to vote on their budget to allocate the $27.4 million in Tax Increment money was ignored. Is this because Measure 26-92 passed, and the Council no longer has to defer to the PDC Board? Is the Portland Development Commission Board no longer a key stakeholder in making decisions about what happens in Urban Renewal Areas? I am shocked and dismayed that no PDC Commissioner was asked to participate in this morning’s work session.
My conclusion: If the Streetcar extension is a good idea and cost-effective in the long run, it seems to me that thoughtful people volunteering their services and expertise on the Urban Renewal Area Citizens Advisory Committees and the Portland Development Commission Board would buy into it, if asked. It’s very troubling to me that none of these groups gave input today, and that they seem to have had limited or no input into the proposed funding mechanisms. This morning at the Council worksession, there was NO discussion about what would not be done in the three URAs because of allocating many millions more to the Streetcar. Staff implied Council could just increase the maximum indebtedness and do everything in all three districts. That may be true – but I sure would like the Citizens Advisory Committees and the Portland Development Commission Board, our citizen experts, to be asked and have time to look over the proposal and see if they agree.
Council was only given one side of the story this morning – the side that says we can have the Streetcar and everything else, too. Maybe we can…. but shouldn’t the viewpoint be aired that sacrifices may need to be made, prioritization in funding choices is necessary, and that it’s the Council’s job to hear people talk about potential problems as well as rosy forecasted solutions? I can’t tell from the PDC meeting and this morning’s worksession if the Streetcar funding is a good idea or not. Based on this morning: Peachy. From last week’s PDC hearing: Not so much.