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New model needed to increase investment


by: SUBMITTED PHOTO - John CarterIf you look around our region, you can’t help but notice the existing infrastructure — bridges, roads, electric and gas systems, communication networks — that provide the energy for our homes and businesses and allow us to move the goods and to provide the services that drive our economy. That infrastructure also enhances the livability and our enjoyment of this special place.

Some of these investments, like our roads and bridges, are obvious. Some, like the Bull Run and Hagg Lake water systems, are tucked away. Some, like Forest Park, are recreational gems.

These projects weren’t just built to suit the needs of the day. They were designed to provide room for growth and to support long-term economic prosperity, reflecting confidence in our region’s future.

Today we struggle just to keep up with maintenance on what we have, and to build what we need now. Overall, our infrastructure is in decay. Why does that matter? It’s the framework and backbone of economic growth. We need to improve it, not only to maintain our ability to attract new business, but also to maintain competiveness in the businesses that we have.

To grow our economy, and to provide the jobs we need for our children and grandchildren, we have to increase our investment in our infrastructure. But with the old public funding models under pressure, we have to be innovative in our approaches.

Three years ago, I was asked to join a group looking at how we improve economic growth in the region. The group formed as the Community Investment Initiative, and has been working the problem on a volunteer basis with support and research funding from Metro.

We concluded that the key to growth was improving and expanding our infrastructure foundation. The numbers we found were frightening — we need to spend billions of dollars in the coming decades just to keep up with basic infrastructure needs, and billions more to accommodate any real growth. And funding sources are uncertain.

The CII group has been working to develop a realistic strategy to pay for tomorrow’s needs.

After more than two years of research, discussion and understanding, we think we have a formula that can succeed. We’re calling it the Regional Infrastructure Enterprise, or RIE, a project developed by the Community Investment Initiative’s Leadership Council, with input from many members of the community.

With the RIE, we are planning to tap into private sector expertise to identify and develop projects suitable for a combination of public and private investment to help bridge the funding gaps. The RIE will be open to projects throughout the region — from Gresham to Wilsonville to Hillsboro; we’ll pay less attention to city boundaries than to regional needs.

This doesn’t mean we’re “privatizing” the public sector projects. It is a model of combining both private and public resources, and finding projects that can be approached with that combined model. We’re talking about being smarter about development, construction contracts and financing options.

We’ve done this in the region before, when we built the MAX Red Line to the airport. This was a model cooperative project between the public and private sector - the port, the city, TriMet and Bechtel.

Bechtel built the MAX line, on time and budget, and its development arm with partners created hundreds of jobs at the Cascade Station shopping area. More than a decade after the MAX line launched, 3,200 people daily avoid driving to PDX and take the publicly owned train instead.

The key element for both public and private sectors is the need to be globally competitive in today’s integrated economic world. We’ve got to be able to efficiently move people and goods around this region, and help our traded sector export, to stay globally competitive.

The CII plan to create the RIE is only part of the many things we need to do to improve economic growth. Another important area is utilizing our industrial land sites. Two of the first steps we can take are approval of House Bill 2284 and Senate Bill 246.

These bills will help us finance the investments we need to develop our industrial sites, and provide clear job-creation incentives and requirements.

Our average annual income continues to trail our neighboring states and the nation - to improve our economic growth outlook we need to invest in our basic infrastructure. It’s imperative for our regional competitive position, and with limitations on available public funding, we need to come up with creative solutions. One answer, from the Community Investment Initiative, is a new development and finance approach through RIE.

Our children’s and grandchildren’s well-being depends on how successfully we provide the economic foundation for their future.

John Carter is chairman of Schnitzer Steel Industries and is a member of the Community Investment Initiative’s Leadership Council. In the interest of full disclosure, Mark Garber, president of Community Newspapers, is a member of the steering committee of the Community Investment Initiative.