Pair of factors are driving Foothills?
Like many concerned Oswegians, I have been following the scam that is the attempt to redevelop the Foothills neighborhood. It is not an easy task, because there are so many stakeholders involved.
Two factors appear to be driving this project:
First, the desire of Homer Williams and his firm to secure financing through a 'public and private partnership.' Rather than go out on the open market to secure construction loans, Mr. Williams and his partners are looking for a public subsidy to maximize profit. This gambit worked for them in the Pearl District and at the South Waterfront in Portland, but is it a 'fit' for Lake Oswego?
Williams, Dame and White have stated, repeatedly, that their project will not go forward without a streetcar component. If so, then maybe it should not go forward at all. The taxpayers don't owe Mr. Williams and his partners a profit on a speculative business venture, especially, one to be built in a floodplain.
Public and private partnerships are a red flag. They are an effort to avoid the marketplace. Crony capitalism is the use of public money to finance private gain, usually to the benefit of political insiders. Portland has been playing this redevelopment game for years, using light rail and streetcars, in conjunction with Mr. Williams, Metro, Portland Streetcar Inc., and various federal agencies, to finance redevelopment, which, in turn, produces enhanced tax revenues, through incremental tax financing, in urban renewal districts. Cities and counties are stakeholders in this process, as they receive increased real property tax revenue. Local government greed is the second driving force.
I also have a concern with the budgetary process for this project. How does a projected $458.3 million cost for the streetcar, as of 2010, get cut by about half in 2011, just because there is citizen pushback? Were the original numbers reliable and valid?
The Willamette Shore Line railroad right of way was purchased in 1988 by a syndicate to include the cities of Portland and Lake Oswego, Metro, Clackamas and Multnomah counties, TriMet and ODOT, for $1.9 million. Twenty-some years later that right of way is valued by its owners at between $94.5 and $97 million, as much as an increase of 5,105 percent.
Metro estimated that in addition to the value of the right of way, local, regional and state funding will amount to between $57.3 and $86.3 million. Federal funding was estimated to be between $227.8 and $275 million, for a total cost of $458.3 million.
There is no guarantee that the federal government is going to come up with 60 percent of the funding. If the federal government doesn't pick up its estimated share, then its undelivered portion will fall upon local, regional and state taxpayers, if Mr. Williams is to have his way.
There has been no public demand for a streetcar to Portland. If the public doesn't want it, it should not be built. An advisory vote on the issue, in May of 2012, would be a waste of time and money. We already know from the recent survey that 52 percent of the 300 people queried were opposed to the project.
What should happen is a binding public vote on the creation of the required urban renewal district - as soon as the final estimates are published.
Alan L. Baker is a resident of Lake Oswego.