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This page contains a single entry from the blog posted on March 22, 2006 7:40 AM. The previous post in this blog was A divine fragrance. The next post in this blog is "Dirty money" at work. Many more can be found on the main index page or by looking through the archives.



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Wednesday, March 22, 2006

Follow the money

A couple of items in the papers yesterday shed some new light on just how much we taxpayers have spent so far on the infernal OHSU aerial tram [rim shot]. According to yesterday's Trib, actual cash outlays for construction have nearly reached the $40 million mark:

Unless the Portland Office of Transportation comes up with $13.4 million soon, the controversial aerial tram project will run out of money and grind to a halt in six weeks.

The department, which is managing the tram project, is expected to spend the $40 million pledged to the project by the end of April. Unless the Portland City Council authorizes more funds for the project by then, the transportation office will not have the money to continue buying materials or to pay the workers building the tram, which will connect Oregon Health & Science University’s new building in the South Waterfront area with its facilities on Marquam Hill.

Meanwhile, in its incredibly wrong-headed and inaccurate editorial yesterday arguing that the city simply has to pay more to build the Kohler-Coaster, the OHSUregonian revealed that the city has already borrowed $20 million of the construction costs to date:
Already, the city has borrowed $20 million to pay contractors to build the tram. Without a completed tram, the city could not collect from the other players to cover this advance, but would almost certainly have to repay it from the city's general fund.

And that's not counting the cost of the ensuing court battle.

If true, this illustrates how our city government misleads us. They strut around insisting that the city's paying only $3.5 million toward the tram, but they allow the city to run out and borrow $20 million toward building it, with no way to get it back from OHSU and the developers. Great work, guys! You deserve to be re-elected.

As for the main thrust of the O editorial, I won't even bother to argue with it here. Part of its error has been capably critiqued elsewhere. But at last report, the guy who runs the O editorial page is married to the chief p.r. flack at OHSU. Given that conflict of interest, the O's repetition of the latest threats and bullying from OHSU and Homer Williams isn't worth discussing in any detail.

Still, I can't resist noting that the O thinks the city now has a "legal and moral obligation" to build the tram. When you're lied to, cheated and manhandled, as the city surely has been, does morality require you to submit to the further demands of the people who are doing it to you? How sad that that's the Oregonian value system.

Some days part of me thinks that those folks deserve everything Craigslist is doing to them.

Comments (11)

From my perspective as an outsider following this issue primarily on your blog, the residents of the rose city owe you a debt of gratitude for exposing this very expensive folly. The O certainly cannot be trusted to provide fair and balanced coverage of this issue given the conflict you have brought to light. Do they give pulitzers for weblog content? If not, they should name you the first recipient. Good work.

If not, they should name you the first recipient. Good work.

Hey, I thought nice week was over. ;)

I have no idea if Portland has a legally binding obligation to guarantee the completion of the tram. The lawyers can figure that out.

BUT, "a moral obligation"? What are those editorial writers at that rag smoking these days?

Thanks for linking to the Portland Freelancer. As far as the ensuing court battles, the city’s attorney said there are two lawsuits currently underway that would stop if we canceled the tram, so we’d already be two up before the next lawsuits were filed.

My recollection of the City Attorney's statements were that the City was not responsible for payments beyond the originally dedicated $3.5 million, and that if no other funders provided the additional funds necessary to complete the tram *rimshot*, the City was not liable for providing those additional funds.

Contrarily, OHSU seems to think that the City is liable for all the funds to complete the tram *rimshot* and then will be paid back the portion which OHSU has committed. It sounds like if the City has borrowed $10 million to pay for parts and construction and it's already spent, then construction needs to stop and the City needs to collect sufficient funds to pay them back to the $3.5 million and then continue construction.

That brings into contention the contractor's contract with the contract manager, the City. I've said before that I suspect that the City will be left holding the bag and that the contractor will have to sue the contract manager, the City, before the City will then turn and sue OHSU and other unpaid or underpaid underwriters. Of course, OHSU is already threatening countersuit or some kind of preemptive suit on its own, waving around Councillor Markowitz like they are.

It's damned close to cards on the table time.

And did anyone notice that there was mention of a potential for a Government camp-to-Timberline tram in the O's front page Walden / Blumenauer Mt Hood Wilderness article? Mind you, not a lift, a tram.

Should be interesting how they spin this one to us. The engineering challenges you need would solve here would at the start be much more costly than OHSU's approach. And 2,000 vertical feet to boot!

Anyone whose "moral obligations" are dictated by the Oregonian needs some counseling... or medication.

to the point, from Rob Kremer:

"...They also want you to believe, I think, that their constant shilling for OHSU's tram has nothing to do with the fact that Bob Caldwell, the Oregonian's Editorial Board chair shares a pillow with Laura Kuykendahl, public information officer for OHSU.

Which must be why they have NEVER disclosed this little factoid in their editorials."

Come on, they are building this thing at top speed. The mantra now is that they can't collect LID taxes without the tram. I still think the Armory Theater is a bigger boondoggle, but who cares anymore? We'd get a slide show about why we need something we don't want to pay for anyways.

The idea of getting a developer to pay one dime for the tram he doesn't have to is laughable. You would think Erik would learn some of the subtleties of business by now.

It is also interesting that PDC's Larry Brown who is heading the NM Urban Renewal District (the tram) has stated in public at a NM URAC meeting that there are no "financing costs" for the tram, but as noted in the Trib the City/PDC has borrowed $20M so far for the tram costs. Can I borrow some free money like Larry is contending so that his "claim" can be true?

Borrowing $20M and going up as rumors have it, and paying for the interest on the amount is no small change. And, of course, Sam probably wouldn't even include the interest costs for the tram as a "tram cost". It's not direct enough.


Jobs jobs jobs. As spoken by Mr. Adams.

I'm elected and you're not.

That settles it . . . it is a valid public purpose and that is the complete and total end of the inquiry . . . costs and attorney fees awarded to the defendant against the plaintiff.


I was absolutely enraged when I read the (unsigned) editorial in the Whoregonian. My first thought was the writer obviously had some hidden agenda and is a shill for OHSU or the developers. I am sick of the rampant dishonesty of these people. They have made fortunes from "urban renewal" projects, and are in a large part responsible for the ever-growing debt the tax dollars is used for (instead of things like schools, roads jails, etc.) They lie about finances and play the shell game with the public. (Which hand has the money?? Neither! It's coming out of OUR pockets.) What wh*res!!


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