Bottom line: WEB is for sale
- Bill Tierney
- Lake Oswego Review - Opinion
We have a problem with the West End Building. In a nutshell, since the city's 2006 purchase, there is no community consensus if we should keep it, how to best use it or how to pay for it. This is compounded by the fact we bought it for more than it is worth today.
I joined the city council in January 2009 and even though the building was bought years before, it is now my problem.
Let me bring you up to speed. My fellow Councilor (Jeff) Gudman used this space to start the conversation. The Review is not my preferred method to discuss public policy but I think it important to add my voice so the community can look at the problem without glib comments and barnyard analogies.
Also, we do not have a lot of good choices, so your input is encouraged and appreciated.
I have two goals that I think are shared by all councilors. One, get permanent financing in place. Two, maximize the building's value.
We have been working on solutions much slower than anyone would like. Why, because every solution comes with a high cost. If it was easy, it would be done.
To the first goal, council supported my request to get permanent financing. On May 17 council authorized it. Previously the building was financed through interest only loans. It was relatively low cost but not a sustainable and prudent approach. Although it will cost us about 2 percent of our budget, a million dollars more per year, it is the right thing to do and was supported by all Councilors.
To maximize value, of the many options considered the one making the most sense was move city hall and the police department to the West End site. We need to put police and emergency communications in a seismically sound building and the city hall building has problems. Not an ideal solution since it is expensive and many believe city hall should be downtown, but we did not have a lot of good cards to play. Recall, the building is under water so the sale option means a sizeable multi-million dollar loss. A special working group reported to the council early last fall this solution looked viable in large part because focus group research indicated community support. We were all pretty excited and supportive, we finally had a solution. We talked about a November 2011 ballot to ask you to support a $46 million general obligation bond.
A smarter councilor than I suggested we confirm the community support assumptions. The answer was clear - no!
Back to square one. Council shifted its thinking and authorized the city manager to sell the building along with other options. We used research to hear you and then acted. Bottom line, WEB is for sale.
This is not over. In this challenging real estate market, once we find a willing buyer, most expect we will sell it at a loss so we will need to figure out how we make up the significant difference.
Maximizing value is elusive. It is a tough issue with multi-million dollar costs and no easy solutions. We will continue to come up with alternatives and if one does not work, we will try another.
Bill Tierney is a Lake Oswego City Councilor.