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Monday, November 19, 2007

And now, some more delusion from the O

The falsehoods oozing from Portland's comical Oregonian newspaper get more outrageous by the week. Today we're treated to another "news story" that informs us that the City of Portland is simply awash in money.

Earth to Ryan Frank: The City of Portland is roughly $4.6 billion in debt, including $600 million in debt for "urban renewal." It has no money for roads or an adequate police force. Its mayor-to-be is holding meeting after meeting to inform residents of an unspeakable transportation crisis. The city's falling apart, both physically and financially. By any objective measure, it doesn't have money for any of the foolishness about which you so eagerly write.

Comments (19)

Yep, I was wondering the same thing when I read that column. The odd thing is that if you look at the Portland budget you'll see that property tax revenue is actually a fairly small part of the budget. So even if they're collecting more property tax it doesn't mean that there is enough money to cover the debt they've racked up.

I'm still baffled by the unfunded pension plan. The San Diego pension plan mess was actually smaller than the current Portland one. That one caused a big ruckus but nobody seems to care about the Portland liability? Instead the city council spends their time jacking off some splinter activist group about honoring Chavez?

Two things Ryan leaves out.

He said the district spent the money in the plan 9 years faster than anticipated. But he didn't say if all the planned projects were funded.

He didn't clarify that the new money is simply increasing the debt limit.

He also didn't say how long the pay off period would be extended if a couple hundred million in added debt was piled on.

He didn't clarify "expired" either.
The idea that 100s of millions of new money is being realized is completely dishonest.
Which is exactly what the PDC does best.

What I see here is the PDC looking to find millions more to fund itself.
So they recalculate the Pearl district UR to show they have a couple hundred more in borrowing capacity.

Then they spin their "recalculating" as some warm success and discovery of new money.

In reality, the city is maxed out with Urban Renewal.
Many projects are way over budget and they are grossly short and unfunded on current comittments in multiple districts. Primarily SoWa with at least 100 million in overrun projects unfunded.

They are making everything worse by covering up their mismanagement and imminent fiscal calamity.

I urge PDC employees to start whisleblowing immediately.

I'm confused. Is he saying that the extra $200 mil is additional unanticipated property tax revenues, or is he saying that they can borrow that much more?

******I'm still baffled by the unfunded pension plan. The San Diego pension plan mess was actually smaller than the current Portland one. *******

Part of the difference between Portland and San Diego is this. In San Diego they cooked the books to pretend they were paying into the pension plan when they weren't. In fact I think they were actually borrowing money from the plan to balance the city budget. In addition they had some massive investment losses in the plan.

In Portland the City has been paying the P & F pensions as a cash expense out of current revenues since the 1960's. So the difference between what is owed into the new pension plan and what cash is available to service that "debt" is much smaller than what SD's was when San Diego's pension plan went t's up. Whoop whoop.

Greg C

KPMG could surely offer some concise distinction between Potrland and San Diego. And so too a law firm that has collaterally represented both, as to bond and pension matters.

On the safety worker pensions, pay-as-you-go is the-way-to-go -- unless you want to double your risk exposure.

If the pension obligations are as legally enforceable as a full faith and credit obligation then we just need to consider the obligation as yet another entry when calculating bonded indebtedness; relative to limits on bonding. The word "bond" is not a magic word . . . "indebtedness" is the correct word and includes obligations such as contractual based promises for future pay already earned for past work.

You forget-

Upside money is uncommitted money that can be spent on any sill-ass thing commissioners want.

Debt repayments can only come from pre-determined and earmarked sources of funds that usually need a deidcated tax for them.

You sure about the "mayor-to-be" part? I'm hearing rumors of a serious threat.

"Debt repayments can only come from pre-determined and earmarked sources of funds that usually need a dedicated tax for them."

So, is the city legally prohibited from using discretionary funds to pay down debt? If so, this is a terrible public policy, but not surprising.

*****Upside money is uncommitted money that can be spent on any sill-ass thing commissioners want.******

Absolutely correct. That makes the P & F pension debt just one more dollar we all owe. My point was that the P & F pension obligation at least came with dollars available to help fund it so it wasn't all by itself as devastating to Portland as the pension blowup was to San Diego. Which is what I took Andy's question to be.

And of course the morons in Silly Hall can choose to treat it as just one more pot of loose change.

Greg C

If they have 210 million "sloshing around" in property tax revenue from URAs, why not let them expire and have the 210 million entering the general fund?

Why segregate this into a PDC piggy bank?

The URAs accomplished what they were intended to accomplish. Now it's time to get that money into the general fund to pay for things like our "transportation emergency."

"Debt repayments can only come from pre-determined and earmarked sources of funds that usually need a dedicated tax for them."

I was making a statement in general. When the CoP gets $30M upside on the budget it never thought of paying down debt, rather, doula training.

Its like the tobacco settlement money - It all got sent to the general fund. I thought it would be dedicated to healthcare and stopping people from smoking.

That's what so maddening, when it comes to any extra cash it never pays off debt. Any debt gets left until voters are forced to raise a tax or lose a service.

Well, now...Dan wants to spend half a billion dollars to build a public fiber-optic internet line for all of Portland. Sam the Scam wants us to pay $400 million in new fees and taxes to pay for roads. Sam's never come in on budget, so you know it'll be higher than $400 mil. Why not take Dan's half-billion pot o'cash and give it to Sam? What could possibly go wrong?

Why segregate this into a PDC piggy bank?

Because property taxes are shared with the County and School District.

That's what so maddening, when it comes to any extra cash it never pays off debt.

C'mon...how exciting --or headline grabbing-- is paying off debt versus providing some new service or program?

So what is hoing to happen in 2008 when the overly inflated property values crash and property tax revenue gets cut?

Why not use the "excess" to fix the darn streets? Using Opie-logic, you could expand the boundaries of the Pearl URD to include the unpaved streets and most needy portions of our major traffic arterials. Sam could save his breath, and quit begging for a new transportation tax that is likely to get defeated via referendum.

It's too bad the press both insufficiently expalins TIF urban Renewal abuse and echoes all of the cover up hype.
If Ryan and others did a better job [if their editors would allow] people would have a clearer understanding of the corrupted attempt to deal with blight.

In this misleading story, people are handed the cooked up idea that extra money has come into city coffers. It hasn't.
"Urban Renewal" TIF (Tax Increment Financing) is 100% all borrowing. It'a municipal credit card.
In fact the increment of UR property taxes siphoned from 12000 acres of Portland can only be used to retire debt, whic is massive and growing. Far from the idea of new money or generating new revenue.
Just how far has this once somewhat prudent minicipal tool been retarded.

The Urban Renewal Citizen Advisroy Committee for SoWa has discovered
30% of TIF spending in SoWa will be cash payments to the developers and OHSU.
Payments labeled as economic development, jobs accelerators, research enhancement and several other line itmes.
Tallying up PDC numbers shows OHSU getting $51 million in borrowed TIF cash payments, along with $11 million for lobbying the feds. Other developers have been receiving many millions as well.
This on top of the sweeping zoning changes and free infrastructure the UR plan provides.
Developers are whinning a bit about wanting a bigger share of the TIF feeding. They're angered about OHSUs TIF millions soaring.
But rememeber, these millions are being distributed while the city claims it's share of the Tram is small, and while public improvement projects in SoWa lanquish withoiut funding to complete. On and on it goes and with eveyone making out like bandits nobody wants to rock the boat. Despite the realization by all of the stakeholders that SoWa is broke.
And that for all intent and purposes so is OHSU.

Not a single city leader will rock the boat either. They're all too afraid of being a leader.

PDC reminds me of the plant in "The Little Shop of Horrors"..."Feed me!" and it just continues to get bigger and bigger and...

Hey, you guys don't seem down with the utopian Socialist vision. Taxpayer-funded wi-fi is in the Constitution, dammit!

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