Dont buy the team Ñ sell the stadium
SOAP BOX: Can PGE Park get back in black, or should we sell while it's still an asset?
Portland Mayor Vera Katz has put her finger on the solution to the growing debacle involving PGE Park, Portland Family Entertainment and the Portland Beavers baseball team.
She said, 'This is a problem that É has to be solved by the private sector.'
In 1999, the city sought proposals to renovate and operate the aging Civic Stadium and after unusually secretive negotiations signed a deal with PFE. The city would put in $33 million toward a $40 million renovation, and PFE would buy minor-league baseball and soccer teams Ñ the Portland Beavers and Portland Timbers Ñ and operating the renamed PGE Park.
Substantial profits for PFE and the city were forecast. Instead, Portland taxpayers may now be saddled with millions of dollars in losses after PFE's well-documented default. Some local officials are talking about buying PFE and/or the Beavers as a way out of this situation.
Here is a better idea: Sell the stadium to the highest bidder and use the proceeds to pay for an actual pressing obligation of the city. For example, the proceeds could be used to help retire the more than $1 billion in unfunded police and firemen's pension liability.
How did the city come to own a sports stadium, anyway? That decision dates to the 1960s, when several proposals to build sports facilities were floated and shot down by voters and legislators. Oregon voters twice rejected $25 million bond issues to build a domed stadium in Delta Park, and legislation to allow counties (e.g., the three metro-area counties) to build and operate a stadium was introduced in 1965 but failed.
Meanwhile, the Multnomah Athletic Club decided to sell Multnomah Stadium. The club built the 24,000-seat facility in 1926 but had been losing money on it for years.
Several downtown property owners launched a 'Save Our Stadium' movement, and the Portland City Council authorized a ballot measure for $2.5 million in bonds to buy it and spend $400,000 in maintenance and improvements. To show how little things have changed, the $2.1 million purchase price was nearly twice the city planning commission's appraisal of $1,077,000.
The 1966 bond measure passed with 55 percent of the vote, and the city bought the stadium, renaming it Civic Stadium.
The city now has a clear choice. The stadium is undeniably an asset. It sits on 7.09 acres surrounded by expensive real estate on all sides. The city can keep the stadium and continue throwing taxpayer money at it, or sell it as an asset not connected with core city services and use the proceeds to provide some relief for the tasks the city does need to do.
Fans of events at the stadium Ñ most notably the fewer than 5,000 fans on average who bought tickets to see the Beavers last season Ñ might object that with no alternative facility, Portland would lose these events. Maybe. But perhaps the owners of a prospective major-league team might buy the stadium for use as an interim facility. This is surely a problem for the private sector, recently rediscovered by the mayor.
What would happen to the stadium after such a sale would be decided neither by government officials nor well-connected local groups making sweetheart deals. What would happen to the site would be determined by the marketplace and by individuals risking their own money, instead of ours.
Michael L. Barton is a research associate with Cascade Policy Institute, a Portland think tank.