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Friday, February 3, 2006

Today's tram lie

The latest from our underachieving daily newspaper:

Someone will have to pay. Crews have spent five months putting the tram together, and they can't stop now.

Who says? Mayor Potter, please -- not another penny from the city's property taxpayers! And people, don't fall for the head fake -- property tax money from all of us is what "urban renewal funds" are. Just don't do it!

Comments (24)

Here's another misleading one in today's Trib:

the research hospital’s new building in the South Waterfront

How much "research" will actually be done in the new building? As I understand it, little or none.

I listed others on your other thread entitiled

"New tram tab: $55 million -- or maybe more"

Well, to be fair it IS a research hospital. The headline doesn't say that building has anything to do with research.

sorry -- didn't mean headline... Meant line,

Someone needs Econ101 on sunk costs.

From the Tribune
""""The OHSU Center for Health and Healing now being completed there will house 100,000 square feet of clinical research labs""""

This is new.
The building is 16 floors and now in the heat of criticism they are all of a sudden calling 8 to 10 floors of it "research labs"?
Can this get any deeper?

And of course the health club is a "wellness center"


Thanks J. I'm glad somebody out there remembers Econ 101. Potter got a BA (generally a sciences degree) in Business from UP. He should know better. I don't think anybody else on city council has a single economics course under their belt, let alone practical experience. I'm sure Erik Sten didn't have to explain elasticities of substitution to get his BA in English.

The Orgo editorial is raging CODE RED for Tramland Security. Publisher and editors are blaming anyone, anywhere else but inside their own flim-flam myth mouth.

The tram's dead. The paper killed it with false hype. Their editorial endorsement -- or worse, if The O Leads The Band to do promotion for your project: it's the kiss of death. The paper's pumping for you is like having Liars Larson favor your campaign. That breath on it is the black plague, you're a goner.

The zerO never gave Portlanders the design and development fantasy-facts. They did not report the budget began bleeding buckets until blogs did. Remember, it's only graft and fraud if the paper says it is.

And the glow-in-the-dark dirt is not a deadly toxic dump ground until Stickel Says it's toxic. Besides, somebody's gotta get sick and die or the doctors don't have work.

City oversight could just shut down the tram and tell everyone the low-ball newspaper lied about Waterfront Money Demands to start a ponzi-scheme invasion of the area. Portlanders would be dancing in the streets to see the Enron of Info Inflation popped and flattened, and the politicos who pin it on them where it belongs, would be reelected unanimously. With the grateful thanks of friends of journalism everywhere.

Did anyone catch the Trib's note about $32 mil in cost overruns for the transit mall light rail project? The Trib basically made it sound like projects like this always have $30-40 mil in cost overruns. Of course, the the original estimate for that project was well over $100 million. Leaving aside whether it is a sane project, the transit mall light rail deal is not expecting an increase of 267% over the original cost. The tram gets that distinction.

To continue the Oregonian lack of reporting, or some may call it "lying".

The latest North Macadam 5 year budget presented at the Jan. URAC meeting had a total of $60.75M of public dollar expenditures. Of that amount there are three significant line items that the public will find interesting:

North Mac. Strategic Opportunity Fund-$12.532M
Description; Fund future public investment opportunites such as development agreement with property owner

Business Loan Program-$5.208M
Description; Financial assistance through loans and grants (e.g. the Quality Jobs Program) to help firms grow and create jobs. Also generates program income and leverages PDC dollars with private or public funds.

BioScience Development Strategy-$400T
Definition; Develop program/project recommendations to create jobs in target area sectors with high concentration, including accelerator facility.

These three items total $18.140M-almost ONE-THIRD of the whole 5 year budget. And these three items are what I call "gimmies" "fluff" "paybacks" at taxpayers expense. What do they have to do with what urban renewal is suppose to do? Do you want your tax dollars to be used this way-pay for a OHSU accelerator? Loans to the developers?

Now, couple this thought with items that the public thought they might be getting in the near future of at least 10 years in NM. Moderate Income Housing; Streetcar; Greeway along the Willamette; Park @ Moody; Park under Ross Island Bridge; Transportation improvements;etc.-they are all under or unfunded in the 5 year budget.

And PDC's Larry Brown admitted this at our last NM URAC meeting.

Here's another news item the media hasn't reported:

Another line item in the budget is:
Harbor-Naito Redevelopment Strategy & Implementation-$7.09M
Description; Redelopment strategy for Harbor-Naito area, bounded by Harbor, Naito, I-405 & SW Clay St. Estimates in FY 2008-09 & FY2009-10 include large amounts for transportation improvements.

In the area directly west of the existing RiverPlace area- the hillside between Front Ave. and the 1-5 entrance, PDC is planning to sell off land to create over 1,000,000 sq. ft. of offices, commercial, etc. buildings along SW Front. This is the only north portal point to exit North Macadam Urban Renewal area with projected 15,000 people. It is already a choke-point, now add additional 1M sq ft. of buildings and their traffic generation. Planning? $7M of the $60M budget?

The thing which struck me about the article on Friday was Stadum opining about how OHSU was reluctant to pay any more on this. Big surprise.

Along with that there was the very clear implication that the delays and cost overruns were the fault of the city construction management. That sure looks to me like they are trying to pin overages on the city.

I'm telling you, the city has been set up to be the fall guy on this. Expect OHSU to file a suit that the city mismanaged the project and should pay the cost overruns (probably after a certain date).

Get the city OUT of this thing ASAP!

Hopefully the City isn't on the line to back PATI. That would be the smoking gun of corruption.

Mr. Karlock, thank you so much for posting the tram documents on your website. They have proven an invaluable resource for my campaign.

I cannot believe that the City of Portland does not put "kill fees" directly into any of these projects. By that I mean, if you are going to grossly misestimate project costs or put something in motion eight years ago, like the downtown transit mall, there should be "kill fee" escape hatch clause in any contract that let's the City say, "We're getting way over budget," or "This doesn't make sense any more, not right now" and allow the City to just write a check for $1 million or whatever and walk away. The way things are beginning to look, City Hall was either grossly negligent or in cahoots with the big developers from day one.

Hopefully the City isn't on the line to back PATI. That would be the smoking gun of corruption.

Mr. Karlock, thank you so much for posting the tram documents on your website. They have proven an invaluable resource for my campaign.

I cannot believe that the City of Portland does not put "kill fees" directly into any of these projects. By that I mean, if you are going to grossly misestimate project costs or put something in motion eight years ago, like the downtown transit mall, there should be "kill fee" escape hatch clause in any contract that let's the City say, "We're getting way over budget," or "This doesn't make sense any more, not right now" and allow the City to just write a check for $1 million or whatever and walk away. The way things are beginning to look, City Hall was either grossly negligent or in cahoots with the big developers from day one.

Seems to me, as a rule, nobody "owns" a non-profit. Somebody controls it, but is accountable to the public for its assets.

RT Hinds sez: "Thanks J. I'm glad somebody out there remembers Econ 101. Potter got a BA (generally a sciences degree) in Business from UP. He should know better. I don't think anybody else on city council has a single economics course under their belt, let alone practical experience. I'm sure Erik Sten didn't have to explain elasticities of substitution to get his BA in English."

I've got some bad news for you, RT. Mike Lindberg, the past city commissioner and current presiding officer of the PATI board, is a former professional corporate economist....I believe for what was then Pacific Northwest Bell.

Which is why I keep saying he should have known better.

I got my undergraduate degree in economics.

Tenskwatawa: I love it!

BTW: Who owns the tram?

In one of the SoWhat agreements -- the Development Agreement, I believe it is -- it's very specific that the city will own the tram.

The tram contract is with the City of Portland. PATI is a non-profit suborganization to the City. Confirmed by a PATI bd. member

"The tram contract is with the City of Portland."
I'm glad we cleared that up.

What, no LID payment either!

In looking at the Tram docs Jim posted it appears the OHSU Medical Group,,,,(the 501c3 doctors who own the first SoWa building),,,,,,,,,,

Here's who they are:

What's Up, Doc?
http://www.wweek.com/editorial/3203/6965/
On the Waterfront
http://www.wweek.com/editorial/3201/6926/

,,,,,,,,,have avoided any contribution to the Tram LID (Local Improvement District).

No property taxes, no TriMet payroll taxes, no business taxes and now we find out that they are not paying for any of the Tram that goes to their building?

Maybe I'm missing it, but if I am not people should know.

If "PATI" is Portland Aerial Tram, Inc., which I believe it is, then it's not a non-profit, but is an ordinary business corporation. This evening the secretary of state's website shows it as having been formed on July 20, 2005 as a domestic business corporation, registry no. 300838-93. Its registered agent is J.R. Davis of 2331 SW 6th Avenue, Portland. Someone had tried to form a corporation of that name earlier, on June 22, 2005 (registry no. 293948-97), but the filing fee was returned and the corporation was not formed.

Correction: the contract is with Portland Aerial Transportation, Inc., registry no. 077976-99, which is a public benefit non-profit. Mike Lindberg is the president and Steve Stadum is the secretary.

"The tram contract is with the City of Portland. PATI is a non-profit suborganization to the City. Confirmed by a PATI bd. member"

Jerry,

http://www.filinginoregon.com/
Registry number 077976-99

PORTLAND AERIAL TRANSPORTATION, INC. (PATI) is not a suborganization of the city. It is a full fledged incorporated entity with all the powers that that entails, inclusive of pulling a Paul Allen if they do not like interest rates on a Rose Quarter deal (say oops, bankruptcy) or . . .

. . . if they do decide that they are no longer satisfied with the deal they made on August 22, 2003, that gives their consent to the city to negotiate construction costs even though the city only covers a fraction (with a 2 million max for the city at the time of signing).

The city could demand that under the terms of the contract that PATI come up with the necessary resources to cover the negotiated costs or declare PATI to be undercapitalized and not a trustworthy partner. It is PATI that could be in (anticipatory) breach for publicly asserting that they can optionally ignore their earlier contractual grant of consent. A really good thing, for good fun that is, would be to re-estimate the costs at 120 million and then demand that PATI put more cash into their own accounts immediately, in anticipation.

Ron, that is interesting. At least two PATI bd members think the tram ownership is entitled to City of Portland. Does this say something about the PATI Bd.?

TrackBack

Listed below are links to weblogs that reference Today's tram lie:

» PDC learns how to build the Tram on budget (Step 1: increase the budget) from Isaac Laquedem
Last week the Portland Development Commission received a Risk Assessment Report from Pinnell-Busch, an outside consultant, on the progress of the Fill-to-Pill-Hill Tram (Ftpht, sounding something like a Bronx cheer). Professor Bogdanski provided a link... [Read More]


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