Paulson stadiums fiasco is a done deal
Portland's dying daily newspaper is breathlessly reporting this morning that the Paulson stadiums deal is sealed. According to the O, Little Lord Paulson and his Bush administration honcho dad have "agreed to hold the city virtually harmless for paying... back... most of" the construction costs in the ill-advised plan to spend nearly $90 million on new minor league sports stadiums for that family's private teams.
There is so much weasel room in "virtually" and "most of" that you just want to scream, but until the details of the deal are revealed, there's no way to verify whether the O reporter's sunny, vague assessment is anywhere close to correct, anyway.
The basic algebra that we have been detailing here for the past week or so has not changed. Unless the rent on the stadiums pays all of the city's construction debt, the rest will have to come from taxes and city "fees." There's no other money in the picture. If the debt is $85 million and the interest rate is 6 percent, the debt service will be $6.2 million a year for 30 years. Today, suddenly, they're talking about only $60 million of "city-backed loans" -- no telling where the other $29 million of construction funds in the liars' budget are supposed to come from. But at 6 percent interest (which is low -- the rates will likely be higher), $60 million of bonds would require annual payments of $4.4 million a year for 30 years. Unless the Paulson family is agreeing to pay $4.4 million in rent on the two stadiums, taxes will make up the difference. New taxes, old taxes -- unless it's rent, it's going to be taxes. How much rent the Paulsons are agreeing to pay, no one at the O is saying, and they probably don't even know. If the rent is only a couple of million dollars a year, a guarantee of that rent doesn't come anywhere close to paying off the bonds without taxes.
And indeed, there will be plenty of taxes paying off those bonds. Just as we noted yesterday, there will be a huge new "urban renewal" area declared all over northwest and southwest Portland -- from NW Thurman Street to Portland State -- and all increases in property taxes from that area for decades will go to pay for these stadiums. Since the new minor league baseball stadium will be built next to the Rose Garden, the same will apparently be done with property tax increases in the grossly overdrawn "Convention Center urban renewal" area.
And of course, we're ignoring for the moment the $27 million that the city still owes on the last renovation of PGE Park in 2001 to 2003. We're all just supposed to forget about that.
You think it's hard to fix a pothole or get a cop to show up now? It's only going to get worse for the next 30 years. While they close fire stations and police precincts, and cut off funds for mental health assistance and child abuse counselling, all our taxes are being dedicated to junk.
The next fake drama -- replacing last Friday's bogus lovers' spat between Fireman Randy and Lord Paulson -- surrounds the question whether the Fireman and Mayor Creepy have a third vote on the City Council for the stadiums. Don't be silly; of course they do. Nurse Amanda will probably go along, and if she doesn't, old Dan "Big Pipe" Saltzman surely will. Most readers will remember the "profiles in courage" moment when Danny Boy cast the dramatic final vote for the SoWhat District and the aerial tram -- truly the low point in the fiscal stewardship of the city. This is another one cut from the same cloth. As long as some big construction company and the construction union workers get tons of tax money, it doesn't matter how ill-advised a project is. Portland City Hall always comes through.
Oh, and guess who just showed up as a consultant on the deal -- Steve Janik! Let's see -- Vera Katz, Janik, "The Don" Mazziotti -- about the only guys missing are Neil Goldschmidt and Homer Williams. Done deal, people. As in, totally done.
The other stunning thing about the latest news is the cavalier way in which major decisions have been made about public assets without serious public input. For example, the Memorial Coliseum will be knocked down for a minor league baseball stadium. Period. Missed the hearings on that? Me, too. Remember the neighborhood involvement process surrounding the idea of putting the stadium in Lents Park? That's over now. Period. Meetings cancelled.
But the financial tragedy is more serious than the process insults. Certainly, with this misadventure, Fireman Randy passes his old nemesis Katz in causing the most lasting damage to Portland over my three decades here. When you add in the looming police and firefighter pension debacle, for which he is singularly responsible, he surpasses even the current occupant of the mayor's stall for fiscal irresponsibility.
As others have put it so well recently, the future of Portland -- what little was left after Williams and Peter Kohler sucked up most of it with the SoWhat district -- has been sold to Henry Paulson, folks. If the voting public in the Rose City ever comes to its senses, it will be too late to turn things around. Sadly, it seems time to stop paying attention to these things. It doesn't do any good.