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Don't subsidize convention center hotel

My View: Ill-conceived tourism venture puts your tax dollars at risk


It’s a bad idea that just won’t die.

For years, Metro has flirted with the idea of pumping tens of millions of dollars in public money into subsidizing the construction of a private hotel adjacent to the Oregon Convention Center. Each time, the idea has been rejected as a risky giveaway of public funds to private corporations that don’t want to spend the money to build the hotel themselves because they know there’s a good chance it could turn into a major boondoggle.

But now, tourism boosters at Metro are back again, pushing a secret deal with Hyatt Hotels and a major developer that would risk more than $125 million in public money to benefit these private interests. They promise the moon and the stars if the public only looks the other way as our collective pocket gets picked.

Contrary to the Tribune editorial board’s reasoning (Tribune editorial, Hotel project a good bet, June 6) the hype — and the risk — is very real. That is why local business leaders, including many of Portland’s leading hoteliers, have announced that they are launching a coalition to oppose this misguided deal.

Our newly formed opposition group knows that if this headquarters hotel was a good bet, it would be funded and built by the private sector with no public subsidy involved. But the truth is that this “if you build it, they will come” convention center hotel strategy has repeatedly proven to fail. In markets from Phoenix to Baltimore, similar convention hotel projects have underperformed and taxpayers have been stuck with the bill while developers and landowners receive enormous windfalls.

It is time to bring sustained public scrutiny to the huge giveaway of tax revenue currently being brokered behind closed doors by officials at Metro, the City of Portland and the Multnomah County Commission. While Metro is touting this as a foolproof solution to the Oregon Convention Center problems, they have so far refused to turn over the exact details of the financing, claiming that information is protected, even though they are saying that they intend to approve the deal next month.

Why the rush? What have they got to hide? Could it be, as preliminary testimony has suggested, that this deal would place all of the risk on the taxpayers if the hotel fails, but give all of the profits to a private developer and international hotel chain if it succeeds?

And to make things even worse, the Portland Business Journal has reported that the planned 600-room hotel is going to cost a whopping $330,000 per room to construct. That’s twice what it typically costs per room to buy a hotel located on pricey downtown real estate. But hey, why shouldn’t the private developer and hotel corporation push this project? After all, they’re getting millions in free money from taxpayers, so why worry about the costs?

This terrible misuse of public funds must not stand. If Metro and other local elected officials persist in this risky giveaway of public money, we will refer the decision to a public vote. Taxpayers will then get a chance to decide whether $100 million in tax breaks and subsidies to an out-of-state corporation is more important than other pressing priorities like funding schools and other basic services.

At a minimum, local taxpayers deserve transparency and a voice in this decision. We already know what they think of this idea. A November 2012 poll of 400 Multnomah County voters confirmed that the public overwhelmingly opposes this proposal.

When asked “Would you strongly support, somewhat support, somewhat oppose or strongly oppose giving $110 million in public funding to private developers to build a major hotel as part of the Oregon Convention Center?”, 73 percent of voters say they opposed the idea (48 percent strongly) while only 21 percent of voters expressed support.

Elected officials currently considering this flawed hotel proposal need to think twice about whose interests they were elected to serve. Instead of handing public money over to private corporate interests, maybe they should spend the money on solving some of our nagging local challenges like funding for schools and basic services instead.

Paige Richardson is a spokeswoman for Coalition for Fair Budget Priorities, which represents the interests of several Portland hotels and others who are fighting public subsidy of a convention center headquarters hotel. The committee’s website is www.ouchportland.com.