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Tuesday, June 6, 2006

I love the smell of numbers cooking

Portland Commissioner Sam "the Tram" Adams has published a supposed life cycle cost analysis for the OHSU aerial tram [rim shot]. Under this analysis, the tram comes darn cheap. Be aware, though, that in Sam's world, trams last 50 years, major maintenance will be less than a half million dollars a year, nobody pays interest when they borrow tens of millions of dollars, and you don't need insurance. Oh, and the land and the design competition -- those don't count as costs to the city.

It's on the menu under "linchpins." Try it with the teriyaki sauce.

Comments (32)

I love the sequencing, too. Build it, then ask how much it will cost to run. Bankruptcy, here we come.

It'll last 50 years? Great, that way when the South Waterfront District is finally ready to contribute to the city tax revenue we can use the money to build another tram.

Would be interesting to compare to the 40 years that Jackson Hole got out of their tram, and Total Cost of Ownership.


In 50 years, I will be 75 years old. Maybe by then I will NEED the tram!

(That is unless some kind of flying personal transport is invented by then).

Harry: the Jackson Hole tram only operated for 8-9 hours per day, depending on the season.

If OHSU operates "their" tram for 18 hours per day, it is unlikely to last 10 years LONGER than Jackson Hole's.

And don't forget folks--Sam's Tram is closed on Sundays and holidays.


We really still do not know the "TRUE" life cycle cost. (TLCC)

As Jack posts, life cycle costs are usually performed early in proposed projects to determine their feasibility and comparisons to other possible solutions. "Waiting for the final construction bids, tram operation and maintenance contracts" as PDOT's Rob Bernard (tram project manager) posts is not standard procedure in TLCC.

In the tram's case, TLCC was requested over three years ago by the PATI Citizens Advisory Committee in a letter to city council. And again requested in Nov. O5 by the PDC NM Urban Renewal Advisory Committee to PDC and city council. Commissioner Adams promised a TLCC over seven months ago. You do not wait until a project is almost completed before you develop your TLCC, or you have something to hide. And what good does it do?

The tram's PDOT TLCC is missing some essential, normally included items that increases total cost substantially. Some items not included:
1)Financing costs on $57.7M hard costs plus on all costs incurred prior to construction.(Well over $3M per year)

2)Land Costs; two vacated streets w/land value of at least $4M

3)Design Competition and associated costs

4)PDC,PDOT, City Staff costs attributed to tram

5)Waived/reduced building permit/review costs

6)Special liability, etc. insurance

7)Federal/state Bond Costs for aerial rights over 1-5, Barbur and Macadam

The city's PDOT using a 50 year life cycle cost is also very suspect. Life expectancy of heavily used trams throughout the world has not achieved 50 year life spans. A more realistic life span, especially operating 18 hrs per day, 365 days a year (much more than most tram usage) would be 20 to 30 years. Your TLCC goes up as your life span decreases for a given period. Palm Springs had to replace their tram a few years ago at costs higher than it's initial cost.

Having the city's Portland Department of Transportation perform the LCC is also a "conflict of interest". Remember that PDOT's Matt Brown was
the "tram guru" who now works for Homer Williams/Developer in NM. Matt was a strong tram advocate who "mislead" many agencies and the public on the real tram hard costs. Having the same Department perform a LCC is unethical and not a general practice of those companies, agencies capable of performing a TLCC. Industry Planning groups frown on such practices. An "outside" TLCC should have been performed. Yes, my car only costs 18 cents per mile to operate.

As a member of NM URAC I am disappointed in the continuance of the "tram scam". I and others have projected at least a $260M TLCC for a 20 year period over a year ago based on the projected hard costs at that time ($45M). If all the items noted above were included in a TLCC for a 50 year period the TLCC total would be well over $325M and not the todays PDOT's projection of $273M.

When the tram's hard costs were projected to be $45M, the ridership cost for each trip was approaching $65 dollars based on PDOT/PDC trip total projections. Now, what will it be?

A gold plated cadillac ride with a tuxedo driver?

A week ago Sam said on his blog, "I'd like to believe we have nothing to hide"

This week the TLLC os hiding more of the SoWa folly.

Sam was provided these links below to assist in getting a legitimate TLLC.
He and PDOT chose to do their own.
They know they can come up with any number they want, not document any of it, never face any consequences and have their lap dog groopies (you know who you are) praise them for their work.


Private firm provides life-cycle cost analyses.

Life cycle cost analysis as a decision support tool for managing
municipal infrastructure

We work for government agencies. Our independence guarantees unbiased and untainted Life-Cycle Cost Analysis supported by facts and diligent research.

1. Perform a "reality check"
-All costs for the full system life cycle must be included.

Complete Product Life Cycle Cost Analysis Tool
Life Cycle Cost (LCC) analysis provides methodology for computing the cost of over its lifetime.
Life cycle cost tools endeavor to provide a picture of true cost over the life of your product.

I just called the Jackson Hole, Wyoming's Public Works Department and it DEFENDS their tram only lasting 50 or so years saying "How long would you last hauling Deadeye Dick Cheney's big, fat white @ss up the slopes all day long with his growing team of doctors, lawyers and syncophants?"

Hmmm... not very long, we guess.

Daphne: lap dog groupie AND one-trick pony....


I love it when you're angry. Would you be willing to call me on the phone and say "synchophant" over and over again?

"I want your linchpin..."


Given their willingness to build/operate the TRAM no matter how expensive it gets, I don't understand why they are trying so hard to low-ball the total cost.

The operating costs could double or triple, but we all know they're still going to operate it.

I don't understand why they feel the need to maintain the game of charades?

I and may other people would like to know what's going on here.

Did Commissioner Sam instruct Roland to post this reason why a professional life cycle cost was not prepared?

Has Mr. Barnard ever prepared a project life cycle cost before?

Who instructed Mr. Barnard to exclude debt service and other fundamental costs?

Who told Mr. Barnard what to include?

Was there an earlier draft or two?

Who Ok'd the final draft?

Did Mr. Barnard use professional Life Cycle cost estimating software or any other helpful means?

Is Mr. Barnard free to openly discuss his estimate?

Can Mr. Barnard be interviewed by a local journalist?

Can Commissioner Adams office obtain the full life cycle debt service costs?

If a professional company is willing to complete a thorough and complete full life cycle cost for a nominal fee will the city pay for it?

Will it take months to get
any more basic information?

Who keeps track of money spent on SoWa?

Where can one get a list of all SoWa payments to date with names or recipients and what the payment was for?

How many other projects in SoWa are over budget?
What is the current estimated budget overrun?
Where is a genuine SoWa budget to be found?

What is the current TIF interest rate the city is paying? What rate was used in the original 1999 SoWa plan estimates?

Should the city answer these question?

Pete Kohler may have recklessly endangered OHSU's fiscal stability right along with the PDC risking the city's.

His commitment of OHSU millions every year for decades towards this boondoggle Tram will hobble funding for all of their core missions.

OHSU employees should probably be up in arms.

Well, not the doctors.
The first SoWa OHSU building is owned by the OHSU doctors group, a 501c3, will pay no business taxes, no property taxes and no TriMet taxes. It will house doctors offices, a clinic, a health club, administration offices and "some research space".

All of which could have been acquired without the insane Tram.

But, it's not just the Tram.

The city is also providing the streets and other infrastructure as they poor millions into SoWa. The 1999 SoWa plan called for $288 million in projects and another $160 million in debt service over the first 20 years with millions more needed to retire the debt and to cover cost overruns.

It may be that the debt service itself is a much larger cost overrun than the Tram or the rest of the project overruns.
If the 1999 plan did not assume rising interest rates it may be that debt service is well on it's way to doubling.
ALL of which will be paid for decades with property taxes desperately needed by basic services general fund budgets.

That's why it is important to maintain updated and complete budgets.

Putting a happy face on this is no substitution for prudent management.

"""It'll last 50 years? Great, that way when the South Waterfront District is finally ready to contribute to the city tax revenue we can use the money to build another tram"""

Good one Bill.
That's about right too. It will indeed take around 50 years for the debts to be retired and the other losses break even.

At that point the city will need Urban Re-Renewal

Lord have mercy. There'd be more oxygen in these here parts if you weren't violating the living daylights out of the COMMENTS POLICY.

Cogent, salient, topical contribution.

Thanks Sebastian.

Lord have mercy. There'd be more oxygen in these here parts if elected officilas weren't violating the living daylights out of their FIDUCIARY RESPONSIBILITIES.

If the bond buyers want to maximize their "business" opportunity, and are complicit, who then would be the injured party to deceit? By the same token, would such knowing participation to defraud the little locals defeat the opportunity for the bond buyers to avail themselves of the benefit of judicial enforcement in any federal or state court, even a bankruptcy court?

If the DA had Mayoral ambitions then he could be like Rudy to Drexel. (Instead of a lazy slob, with no ambition; a common ordinary bum.)

There's a guy sleeping 15 feet from my bedroom, under the eve of a church; the DA better go do a "sweep" in the public interest similar to the demands of the St. Johns Negro Removal advocates, but this guy is easy pickin's because he's WHITE.

See generally Drexel Burnham Lambert.

A commenter at Amazon regarding "Den of Thieves" complains as follows:

"Anyone that knows anything about Milken knows that the guy created millions of jobs, and contributed much more to society than people like James Stewart, who often act like parasites at the expense of others."

There is always this kind of possibility:

Google diego pension "promoted to obtain better pension benefits"

Young Stennies:

From "Drexel Burnham Lambert: A Ten-Year Retrospective"
"Unlike other crusaders from Berkeley, I have chosen Wall Street as my battleground for improving society because it is here that governments, institutions and industries are financed." (Reportedly written by a 24 year old Milken)

It is all for a good cause, by any means necessary. I want the good folks at Orrick (and other bond counsel) put behind bars -- their obligation is to the locals and not the bond buyers. "Professional" parasites?

The DA is up for election in 2008. Who would bring charges in January 2009?

(Steve -- please keep good searchable records for such an event. Or write a book.)

Schopp 1 Sebastian nil.

I'll shoot for another.

It's more than a safe guess that not a single commissioner, either at the PDC or city council, (or their staff) can tell us how many $millions the PDC has already paid and is planning to pay OHSU during all this so called negotiations for Tram shares.

Since the South Waterfront Urban Renewal Citizens Advisory Committee, and their budget subcommittee has never been provided a running account, full budget or summary of money spent my bet is nearly a sure thing.

Equally bizarre is the inability for city hall groupies to recognize the recipe for fiscal calamity and maleficence this certainly represents.

Many of them toss out, with ease, all reasonable skepticism by way of "but look how pretty things are" or "you live in Tualatin, so shut up".

You got it SS. Last night I watched the documentary "Outfoxed" about how newsmedia gets co-opted by one political hard line. Very interesting. Made me think about the Goldschmidt gang's relationship to the big O.

But one thing I saw on Fox that I really liked was some citizens talking about the Kelo decision permitting local government to condemn private homes for economic development purposes. One guy used the other F word (fascist) to describe New London's relationship with the local redevelopment agency. I think Fox remains popular despite the fact that it is ANYTHING BUT fair and balanced because it allows discussion on issues the "left" isn't touching.

Hi boys. I am not angry. I'm part of the 75% (Zogby) of the USA that is way too busy laughing at W ad BigFatDick bringing "honor" and "integrity" back to the White House.

What's next, installing Goldy as White House pool lifeguard?

DeLay as Budget Director?

I'm laughing so hard I'm crying.


Can we assume you see a linkage between City Hall's lying about and hiding South Waterfront's financial woes, and the Bush Administration's lying and hiding from their critics?

If there is no linkage, then please find another thread to discuss Bush/Cheney.

Speaking of cooked numbers, did anyone read yesterday's Trib article about Portland mass transit? (with apologies to Jack for hijacking the thread...)

Larry scores a DIRECT HIT on Mister T, sending him back to his drink, minus the mix.

Gosh, I loved the "A Team". Didn't you?

Once again -
It appears "prominent," "reputable," "responsible," "heavyweight," citizens, or citizens otherwise described in the Oregonian, have become so morally seduced as to feel comfortable enough to bribe or blackmail city officials, lie, or hide facts from City Council in order to obtain taxpayer monies for their pet project.

It is time for citizens, if not the Portland City Council, to demand an immediate, complete and independent investigation with the objective of recovering those taxpayer funds paid to the City by its taxpayers.

It should include, but not necessarily be limited to, the following objectives:

1. Recover the additional tram costs from those responsible individuals and organizations found culpable for the increased costs;

2. Consider the potential of charging responsible parties with bribing/blackmailing a city official;

3. Because federal funds are involved, request the local Federal Attorney General to investigate whether the $11 million Commissioner Leonard states was granted OHSU (requiring a $3.5 million payment from the City of Portland) was based on fraudulent actions.

To allow "Portland heavyweights," or anyone, for that matter, to play fast and loose with taxpayer monies for any reason, particularly based on false and material misrepresentation, should not be condoned by Portland City Council or any city council in Oregon.

It sends a terrible message to those many citizen volunteers who give freely of their time and efforts participating in public/private partnerships on behalf of their city.

By not seeking the return of the funds, City Council sends the message that they will condone the formulation of public policy based on lies.

Or, they are, in fact, complicit in defrauding the public.

Without an immediate Council endorsed independent investigation, the "lets-burn-the-taxpayers" smell mentioned in a recent Oregonian editorial becomes immune to any political, legal, or ethical disinfectant. The smell eventually sticks to Portland's Council chambers and our city in general.

And we, the taxpayers, get burned while City Council fiddles a happy tune.

Jack, instead of teriyaki, I think you need a jerk rub?

(sorry, I couldn't resist)

Shadow: I hope your call for fed/state/co attorney general investigations become a reality. There is enough substance in all the information publically known about the tram and North Macadam to request investigations. I wondar who will have the political will to step up.

Citizens should be strongly requesting the investigations, and I hope the media joins in. Nibbling at the edges won't do it as the media is doing. State it like it is. Ryan Frank's article on Portland's Urban Renewal Districts with its midleading headline is a prime example of "editorizing" an article.


I wouldn't hold out much hope with headlines like these from the big "O".

"Officials clear Saif of wrongdoing
Workers' comp - The corporation was "sloppy" in turning over records but didn't break the law, investigators say
Friday, June 09, 2006"

when the stories have content like this buried in them....

The investigators said that, with two exceptions, the people and agencies they contacted cooperated. One exception was Cohen, who refused to cooperate with the investigation without a grant of immunity from criminal prosecution.
The other exception was Katherine Keene, who resigned as Saif president in December 2003, after the disclosure that the insurer had a $40,000-a-month consulting contract with a firm headed by former Gov. Neil Goldschmidt. When state police investigators asked to interview Keene, she invoked her Fifth Amendment right against self incrimination, the report said.

I guess this is what it feels like to be trickled on...

The good people at PDOT failed to include the effect of WIND on the "parrafin type of oil" that must be applied to the Tram's cables ("ropes" on the below Q&A) annually. Does anybody actually believe it will fall exclusively on the sidewalks?

Q: Will the oil from the ropes drip onto homes below? How frequently will the ropes be oiled?
A: The ropes are over the curb of the street so are not close to homes on Gibbs Street. The ropes will need to be oiled annually. The Doppelmayr representative present at the meeting stated that he did not believe that the oil will drip as it is a paraffin type of oil. If oil does drip from the ropes, property owners should document and report the damage to the City’s Risk office for investigation and resolution. There also will be a Tram Citizen Advisory Committee (CAC) that can help to resolve neighborhood concerns over tram operations.

Should the tram be christened "Sam's $50 million Erection"?

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