You can't take a sharp picture of a fuzzy object
Does the Portland Development Commission do a good job? Is urban renewal working in Portland? City Auditor Gary Blackmer (right) sent out a crew to start asking these questions, and they came back with few answers but many additional questions.
The Blackmer report was written up by Oregonian reporter Ryan Frank the other day, and he offered readers his rose-colored glasses, to be sure. "Portland renewal zones flourish," proclaimed the headline. But a careful reading of Blackmer's report paints a much different picture -- an assessment that would better be described as lukewarm. It finds the PDC's job creation strategies only "somewhat effective," and concludes that the jobs picture didn't differ much in several of the city's urban renewal areas from what it was in comparable areas of town that didn't receive PDC subsidies. Employment in two key urban renewal areas was about the same as in the rest of the city -- down around 9 percent. And what additional jobs the PDC creates, the people who live in the urban renewal districts typically don't get.
The O article did own up to the fact that the report criticizes the PDC's data collection and performance measurement systems. But the O summary -- "the city needs to do a better job measuring the success of its business recruitment work" -- is putting it rather mildly. The Blackmer report found that "on an organizational level,... PDC lacks clear goals, measures and data it needs to continually improve its decision-making processes and better link its investments to community results." Indeed, in two key areas, the report finds, the PDC publishes misleading data -- showing projected economic development results for projects that are already completed, and leaving the impression that these are actual, observed results. And the scope of the auditor's investigation was limited by the fact that there isn't enough information readily at hand to evaluate the PDC's performance.
Indeed, a fairer summation of the Blackmer report is that there's no way to tell whether the PDC is doing a good job, because the agency has poorly defined goals and doesn't keep the information necessary to determine whether it's succeeding at whatever it's supposed to be doing. What data the auditor's office dug up on its own reveals mixed results, and some of the records that the PDC shows around are less than candid.
There's enough interesting material in the report that concerned readers ought to read the original document and see for themselves. It's here. Don't let the number of pages scare you -- there's a lot of white space in there. I'm going to post some more entries on various aspects of the report over the next week or so, and I invite readers to help me steer the additional discussion.
Before leaving the study for now, however, just one additional observation is in order. The Blackmer report spills most of its ink on the end results of urban renewal, but it never mentions the opportunity costs of the many hundreds of millions of dollars that ordinary Portland taxpayers have been forced to throw at urban renewal over the years. Remember, more than 19 cents of every property tax dollar the City of Portland collects, from every taxpayer in town, goes to pay for "urban renewal." If the PDC weren't blowing that money by way of its $200 million annual budget (estimated spending for this fiscal year was actually $248 million -- a 167 percent increase over just four years), what else would the money be available for? Expressed another way, how badly does "urban renewal" drain needed funds away from core government functions?
Oregon state law requires cities to estimate the financial impact of urban renewal activities (such as tax abatements) on tax collections, but as has been mentioned in this space before, Portland refuses to comply with that law. Other cities can do it (Lake Oswego, for example), but Portland says it's impossible.
There have been several calls by urban renewal critics for the city to start complying with this law in earnest, but so far they have fallen on deaf ears. You would have thought that the city auditor, while he's busy talking about unavailable data and missing performance measures, might have said something about that. But there's not a word in the report about it.
Posted at 12:42 AM
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Comments (15)
I still like your earlier suggestion, $250M (05-06 Budget) = 1666 $150K houses given away and have the owners pay prop taxes. At least with property taxes you get a 1.5% rough ROI.
Posted by Steve | June 8, 2006 5:34 AM
You especially can't take a sharp picture of a fuzzy object with a Kodak Instamatic.
Posted by Frank Dufay | June 8, 2006 5:37 AM
"""doesn't keep the information necessary to determine"""
I'm shocked!
Posted by Steve Schopp | June 8, 2006 7:19 AM
What is it with auditors in the Portland area? I mean Multnomah Co. auditor says he was pressured to "rosey" the numbers by defated Co. Chair Linn. The Metro auditor is defeated because of percieved ilregularities. Portland School District auditors are quitting one after another. And now the city auditor is releasing a report that if I'm understanding Jack correctly, leaves some very important questions unanswered or ignored, but are crucial to examining whether URD is worth it.
Posted by jim evans | June 8, 2006 11:55 AM
"What is it with auditors in the Portland area?"
I think the better question has to do with those who are cutting the package deals for instamatics. Alexis Dow wouldn't bow to David Bragdon, the son of Neil's good friend Paul. Methinks the picture is starting to come into focus. And shame,shame, shame on the electorate.
Posted by Cynthia | June 8, 2006 12:54 PM
"...the PDC publishes misleading data -- showing projected economic development results for projects that are already completed, and leaving the impression that these are actual, observed results." Sounds like the PDC stole a page out of an old Enron playbook. Private sector executives are being prosecuted and sent to prison for this type of thing. Maybe it is high time that the FBI begin investigating these people.
Posted by Kevin | June 8, 2006 1:29 PM
The PDC is attempting to walk their self serving fabricated line between what they can easily chartacterize as innocent ommission the what they are indeed doing, defrauding the public.
The Tram life cycle cost estimate was a classic example among many in SoWa.
My rub today is who told PDOT's Rob Barnard to exclude debt service and other fundemental costs?
Someone did.
Who told him to use the 50 year life span?
Who instructs the staff to exclude many numbers from reports and to withold budgets from officials and the publici?
Why do the electeds allow this?
Why did Sam Adams present such a flawed life cycle cost estimate? Many concerns for costs, especailly debt service, where communicated to the commissioner and others many times.
On another interesting note:
Is OHSU paying prevailing wage on it's projects?
There's an ongoing debate between the PDC and the State Labor dept over PDC subsidized projects,
but I have not heard any mention of OHSU.
A couple calls this monring and I am nearly believing that on top of many other generous public funding of the sometimes public sometimes private OHSU may alos be enjoying the luxury of not be required to pay prevailing wages on their construction projects.
Projects which are publiclly funded in one way or another.
Does anyone know?
Perhaps the pill projects are paying but their new SoWa not?
Posted by Steve Schopp | June 8, 2006 2:25 PM
Guilt by association? I thought I understood that there were performance issues with the outgoing Metro auditor. How is it that being the auditor of the son of a friend of Goldschmidt confers heroic status? General Metro issues aside, what's the real story here?
Posted by Allan L. | June 8, 2006 3:41 PM
Let's see,
The City Auditor investigated E. Boyles for the return of $150,000 plus fines for her apparent misuse of public election funding. Isn't that just precious?
When is the City Auditor going to investigate the payment of at least $3.5 million by the CoP to OHSU. Taxpayer money that Commissioner Leonard and the Oregonian state may have been paid based on false and material misrepresentations to City Council by OHSU representatives, associated developers and city officials.
How about the City Auditor investigating that?
Posted by The Shadow | June 8, 2006 4:31 PM
Alan L., Not guilt by association at all. The issue at Metro is whether Bradgon complained about Dow in retaliation for DOING her job. It's how the machine operates. On the chance you really are interested in these issues, I told a friend who knows the particulars that someone on Jack Bog's Blog is wondering about the situation.
Posted by Cynthia | June 8, 2006 5:09 PM
Cynthia:
I was wondering -- hence the questions. Answers would be welcome.
Posted by Allan L. | June 8, 2006 5:56 PM
Jack: I have a hunch that Ryan Frank did not write the headline for his article. Maybe Bob Caldwell?
The meat of his article doesn't go with its content. At least he tried.
Another point. Notice that only 5 URA's are analysed in the article, and they are generally thought of as being the most successful (Pearl District, Downtown, etc.), if you can consider it that way. When and if the remaining 6 URA's (Lents, NoPo) are added to the equation, I think the prognosis of all Urban Renewal (even using PDC's thrumped up, inflated, guessimates, etc) will be much bleaker.
Posted by Jerry | June 8, 2006 7:50 PM
Okay, that's enough - I demand that all of you who can't see the "wisdom" of the progressivness (is that a word?) that the PDC brings to the table, immediately turn in your "progressive" card. Next thing you know you'll be complaining when our "progressive" government wants that last dollar in your wallet. We all know that government KNOWS how to spend your money better than you - give it here!
Next item on the agenda - wealth re-distribution (from your pocket to those cozy with government).
Posted by mmmarvel | June 8, 2006 9:53 PM
"scuse me, while I kiss the sky"
Posted by Lily | June 9, 2006 1:36 AM
Yay ! Lily...it's the same old song, isn't it?
We just keep watchin' 'em.
Posted by Anne | June 10, 2006 12:24 PM