Tram Town Hall Materials
Roland Chlapowski
For those of you who weren't able to attend Sam's Tram & South Waterfront Townhall, we want to let you see the materials that were shown there. The two presentations (one by the Portland Office of 
Transportation [PDOT], the other by Portland Development Commission [PDC]) were accompanied by commentary by knowledgeable city staff, which we unfortunately can't post online. While that makes this presentation a little less informative on the specifics of the project, we still feel that it would be useful for everyone to see, nontheless. We've converted them into Adobe pdf format to reduce the file size, but besides that they are the same PowerPoint presentations that were viewed at the Tram Townhall and the City Council Work Session on the Tram.
You can see the PowerPoints here:
Posted by Roland Chlapowski on March 17, 2006
(62) Comments | Permalink | TrackBack (0)
Filed Under Events, Front Page, Office of Transportation, Tram, Transportation
Comments by site visitors
As a non-conservative, non knee-jerk non-libertarian, I must say that the forge-ahead attitude coming down from those overseeing the tram has me concerned as well.
I think that all construction on the tram needs to stop now at least until a reassessment is completed of the construction and operating costs, and who will pay them.
Posted by: Concerned Non-conservative | Mar 20, 2006 6:58:50 PM
Mmmarvel- did you attend the Townhall? If so, I wish you had introduced yourself. But if you didn't, as I suspect, I hope you'll refrain from characterizing the value of the information presented because you had no exposure to it.
I'm sorry you feel the way you do; we are not trying to be sneaky and were definitely not trying to incite any antagonism.
Concerned Non-Conservative-
First, thank you for not being reactionary or "knee-jerk" - it seems as though you are actually open to information, even if it means that you need to evolve your initial preconceived ideas about the project. Let me tell you, this has been a huge learning process for me and the project is not easily summed up in a neat sentence as some people seem to want.
Your concerns are totally valid, so let me respond to them and do my best to lay out what we are faced with, and why were are doing what we are doing. There are a couple major considerations.
First, a short while ago, Sam called for an independent audit that looked at the construction costs and the risks for any future price increases. It was just recently completed. (It did not talk in detail about operating costs, but those are largely going to be footed by OHSU.) The independent auditors found that THE biggest risk for more cost-overruns was "delay." Let me give you a little background on why that is so:
First, the city entered a contract (voted on by the previous city council) that legally obligates us to deliver the project by a certain date, though that agreement assumed full funding, which plays a role in things. If we don't deliver on time, we are at least potentially liable for damages and will almost definitely be sued by OHSU and other interests in the SWaterfront. Since there isn't full funding for the project, we don't believe we're actually liable for damages, but we'll probably still need to go to court. Besides the obvious negative of potentially losing chunk of change, we may also weaken our bargaining position vis-a-vis OHSU and the developers, something we wouldn't want to happen.
Second, the tram is being largely funded by an LID (Local Improvement District), which is basically a property tax paid by adjacent property owners for specific infrastructure improvements. In this case, it is for the tram. Now, counting on those millions of LID dollars, the city (as is standard procedure) took out a temporary line of credit to pay for the construction, since the LID dollars don't technically go into city coffers until after the improvement is complete.
But... if we stop the project, the LID participants won't have to pay those taxes, since they were paying them for a particular project - the tram. If that were to happen, we would have to pay the line of credit off with other city dollars. That would mean dollars from the general fund, which would actually take money away from schools and other city programs. That is something that critics have charged us with, but it hasn't been true (at least not up to this point), since the city dollars are tax dollars paid by property owners specifically for the tram. But, if we stop the project, then we will in fact have to take money from the city-funded portions of schools and roads and social services.
Further, if we mothball the project (something we've looked at) we will face wind-down costs, and if we decide to continue with it, we will face considerable "start-up" costs all over again - probably a couple or a few million dollars worth.
So... if we seem eager to get this done, that is why; believe me, we are not thrilled with the tram (personally, in hindsight, I think there were better options), we have nothing "up our sleeves" as some are charging, and no agenda - other than trying to do right by the public. This is obviously not a great situation, but we are trying to do the best we can with what we've been handed.
The reality is that we are dealing with some pretty tight constraints - ones which aren't easily summarized in a soundbite. But these are the reasons we are doing what we are doing... I hope you can appreciate where we are coming from.
If there is anything else I can clarify for you, let me know. I will do my best to give you a complete picture of what is going on. I will try to get up the costs of the LID withdrawal soon. I wanted that to be part of this post originally, but decided that just getting this up was important to do right away.
Thanks again for being thoughtful. Feel free to email or call me, too, if you want to.
Posted by: Roland | Mar 20, 2006 8:02:49 PM
So my interpretation of the above is that the project is going full speed ahead. Then why bother with these sessions asking for people's input since you have already made up your mind.
Mr Adams was in on this from its inception as Vera's chief of staff and he knew (or should have known) where this was going. Pretty much the same sort of shaky financing is going on with the Armory Theater - or will we have some openness on this also?
Posted by: Steve | Mar 20, 2006 8:23:34 PM
Roland, where is the "life-cycle costs" that were requested and promised by Adams and PDC?
Posted by: Lee | Mar 20, 2006 8:35:17 PM
Wow, what a mess! All this public investment to benefit OHSU and developers and speculators at the waterfront. I do feel sorry for those who live around the tram who are paying into the LID without getting any benefit. This just seems like such a scandal to me. How about renegotiating the terms to make OHSU, the developers and speculators pay all city costs back with interest? I still bet that stopping this thing would cost less than continuing.
I hope that the city has learned its lesson with this thing. I'm no libertarian, as I've said, in fact am more what you'd call a communitarian. But I see no public benefit in this at all. Only bad. It would have benefited the whole city more, I believe, if we had spent the money to restore the waterfront to wetlands and park. A much bigger draw and positive focal point for the city than towers that violate the spirit, if not the letter, of the view corridor ordinance.
Posted by: Concerned Non-conservative | Mar 20, 2006 9:49:47 PM
Roland -
Just an FYI, I work in the construction field and am in contact with the workers and the companies involved. Your view/opinion might be, just that - your view/opinion. But its pretty well known by most of us in the industry, this is a fiasco and a HUGE waste of money. You may be dealing with the "higher ups" but I'm dealing with the folks who are actually doing the work and WE have a much different picture than the one that you paint (or the one that is being painted for you).
Posted by: Mmmarvel | Mar 20, 2006 9:54:02 PM
Sam and Roland - while obviously the tram is a mess at this point and, as everyone acknowledges would have never been done if the costs would have been know, I appreciate the cost-benefit and research you have done into every option including stopping the tram. As Roland points out at the point finishing the tram is the right thing to do financially, and the right thing to do to ensure the growth in the South Waterfront that has already started. At this point stopping the tram would clearly be a horrible decision that, while maybe politically positive, would be stupid from a financial perspective.
Posted by: J | Mar 21, 2006 7:50:47 AM
Lee- We're working to get a life-cycle cost figure and will post it as soon as we do.
Steve- We wanted to share the information we had in front of us with the public and then hear what they thought about it. Circumstances demand that we make decisions, so we are, and they have to be based on something... We wanted to share with folks what we were doing and why and remained (and still remain) open to pursuasive arguments for a contrary course of action.
Mmarvel- I definitely respect the construction workers putting the tram together, but at least from my point of view, that is a vantage point that cannot really take into account a wider reality of private and public investments and long-term economic benefits. No doubt they have a particuarly lucid window into the problems we're facing with cost overruns... and that is a valid issue. It is not, however, the only issue and extrapolating from that particular issue to the project as a whole without taking into account other information is probably not the best way to get a clear picture of the multi-faceted and complex project.
Concerned Neo-Conservative-
Our analysis up to this point has shown that it would cost the city a lot more to stop the project than to continue, and that stopping would entail more legal risk which could lead to even greater costs.
And here in our office, we have learned a few lessons that we are looking to codify into city code with some new ordinances. This includes measures to ensure that city staff give Council accurate numbers and what those numbers are based on, preventing city staff from private sector employment on projects they've been involved in, and requiring non-profits like PATI to report to Council as a whole regularly, which didn't happen before.
I should also say that within the bureaus that Sam has in his portfolio, we are taking oversight responsibility very seriously, though Sam has really always done so.
Finally, we can't just go back and renegotiate the terms of the previous contracts we've signed ... that said, we are committed to making sure that the cost overruns (which were not anticipated in the original agreements) are distributed fairly and that the private sector foots most of the bill. It's important to remember that the city is only covernig 9% of the tram costs so far, even though we are estimating that 15% of the ridership will be public, non-OHSU people.
Sam still believes that while the tram has not been well managed, the overall South Waterfront development -which ensures that OHSU (the largest employer in the city) expands within the city of Portland and which increases the future tax base for the city substantially - will be worth the city investment up to this point.
J-
Thanks for your post; we remain committed to being responsible stewards regardless of the political efficacy that entails.
Posted by: Roland | Mar 21, 2006 9:21:44 AM
Thanks for the background, Roland.
Whoever negotiated these terms with OHSU and the developers should be arrested. I hope that both OHSU and the developers are just as legally bound to deliver a tram as the city is. If so, we should be suing them over this, not vise versa. If not ... then who slept through the contract negotiations? (Aside from all of us citizens, I mean. =)
Even barring any accusations of sneaky dealings, why did the city sign a suicide pact to build a tram no matter what it costs? That's just asking to be screwed.
Come to think of it, Roland ... could you put that contract on-line for the contract minded among us to look at? Maybe the city can get some free legal advice ...
Posted by: mykle | Mar 21, 2006 9:26:47 AM
mykle-
The issue is that the city said it would be the contractor for the project and that the original agreement did not have any provision for cost-overruns. OHSU and property owners would foot the bill (for a set $15, then $40m) while the city would actually build the project.
When the cost overruns started, it put everything into a legal situation that was not clearly spelled out in the original agreement, hence all the problems now.
In hindsight, having a clause about any cost overruns seems like it would've been a wise course of action. But I don't know exactly how the agreement was drafted up or who did it.
Sam had left Vera's office about a year and a half before he was elected and entered office in January 2005, so the tram never came across his radar - because of that, we are learning a lot about the project now that Sam wasn't involved with and hadn't seen before. It's been quite a learning process!
We posted the contracts up on this site a while ago- you can find copies of the original contracts and ordinance on the links below. The second link has other information on the history of the project that may prove helpful.
http://www.commissionersam.com/sam_adams/2005/11/stop_the_tram_p.html
http://www.commissionersam.com/sam_adams/2005/10/issue_update_po.html
Posted by: Roland | Mar 21, 2006 10:23:36 AM
Hmmm.. those links aren't so good. I'll cut them in half so hopefully they can fit. Just paste them together and you should be okay.
http://www.commissionersam.com/sam_adams/2005/
11/stop_the_tram_p.html
http://www.commissionersam.com/sam_adams/2005/
10/issue_update_po.html
Posted by: Roland | Mar 21, 2006 10:26:03 AM
Sam & Roland - Thanks for the information you've provided here. I think it's clear that stopping the project, at this point, would be a big mistake. Knowing what we know today, the City Council, perhaps, would not have voted to build a tram. Knowing this now does not help the City make an informed decision about whether to continue or kill the project. It is reassuring to me that the City is weighing all relevant factors in considering whether or no to proceed with the tram.
Posted by: Mr. Magoo | Mar 21, 2006 10:51:03 AM
Roland: If one really did a true hard cost analysis of the tram (and not even a "life cycle cost analysis") as is being accounted for in many previous blogs, the hard costs really approach the $22M figure which is 40% of the tram cost. And the city isn't even adding in the financial costs of the tram borrowing as todays O finally has admitted.
You are misleading the public if you keep on saying the public's cost is only 9% of the tram cost. An independent accounting should be performed with common accounting practices to demonstrate the true cost to our own city council and staff.
Posted by: Lee | Mar 21, 2006 11:32:08 AM
Lee-
I am pretty sure you are conflating costs of the South Waterfront Development into costs of the tram. The city will expend money on other public projects like roads, the streetcar, and parks, but those aren't tram costs.
Right now, the city is only putting in $3.5m for the tram.
I don't want to be misleading, though, so let me look into this further and get back to you with a definitive answer soon.
Posted by: Roland | Mar 21, 2006 11:40:42 AM
Roland I forgot to add this comment and questions.
If Sam is still saying the public tram cost is still only the $3.5M of TIF money, then the public's portion is 6%. If Sam uses his costs that he identified in his Oregonian commentary several weeks ago, his total came to $11M, which equals 20% of the tram cost (assuming $55M for tram). Now, you state 9%.
Could you identify the numbers and what accounting method Sam is using today?
Since so many bloggers and other news media sources have specified other tram costs paid for by taxpayers, could you respond to why those items are not considered to be part of the tram cost in your reasoning? Most of us if we bought a $55M car would consider the financing cost as part of the car cost (an example).
Posted by: Lee | Mar 21, 2006 11:53:52 AM
Roland,
With all due respect, eluding the true current public cost of the Tram by suggesting someone is including SoWa roads is just a wee bit insulting.
Especially directed at Lee who I have read many posts with extensive data making it clear he understands that roads and such are not Tram costs.
Coming clean with numbers and information absolutely requires the full and genuine life cycle cost. It might be helpful to include an explanation as to why it was not provided long ago or at least since the SoWa URAC requested one back in December.
It appears the Tram will continue to completion with additional city funding
but few people see the current amount as only $3.5 million.
In addition to the Tram life cycle cost, no update to the SoWa plan adopted in 1999 has been completed.
The 1999 approved plan shows funding and progress projections which DO NOT match what is happening in SoWa.
A tremendous lack of revenue and progress with crucial infrastructure, transportation, housing and public spaces exists.
It is becoming evident to many, who have studied the original plan and are watching the Tram and SoWa unfold, that the original determination of "feasibility" was far off the mark.
The city's fiduciary responsibility demands that an updated budget and projections be produced.
The current SoWa plan is now irrefutably obsolete.
Perhaps the PDC is not accustomed to updating and validating their projections and budgets as major projects progress but this should be entirely unacceptable to city leaders.
Please print and study this 1999 SoWa plan to discover it is obsolete.
http://www.pdc.us/pdf/dev_serv/pubs/dev_macadam_report.pdf
South Waterfront, (formally North Macadam), is years behind and countless millions over budget and underfunded.
The $55 million Tram has gotten a lot of attention for being way over budget and city officials feel they were mislead by public agencies.
The estimates and projections made for the greater SoWa plan are following the same path as the early Tram estimates. It may be that the city council continues to be mislead by planning staff.
The original schedule for completed infrastructure shows most of the transportation improvements were to be completed this year.
This $288 (plus $160 million in debt service) 20 year plan is potentially a 40 to 50 year plan capable of devouring 100s of millions more in property taxes than ever imagined.
Again, take a look at the projections.
http://www.pdc.us/pdf/dev_serv/pubs/dev_macadam_report.pdf
"Table 6" has most of the evidence of the now obsolete plan yet other parts of the 19 page report are enlightening and indicate a severe problem.
Contrary to the approved plan the projected tax increment proceeds are NOT sufficient to cover projected expenditures and the Plan is NOT financially feasible.
I would also like to again request that Commissioner Adams pressure the PDC to provide the yearly Urban Renewal basic services impact reports, required by State law.
Posted by: Steve Schopp | Mar 21, 2006 1:48:57 PM
Steve,
Please don't say that I need to "come clean." I think that's rude and I don't appreciate it.
I am giving you what I have - the best numbers I have. I am sorry if you don't like what you're hearing. But it's the best I can do.
Posted by: Roland | Mar 21, 2006 2:07:06 PM
""""Please don't say that I need to "come clean." I think that's rude and I don't appreciate it."""""
I meant that in a generic sense. Not aimed at you or Sam.
I wrote
"""Coming clean with numbers and information absolutely requires,,,"
I didn't write "your" coming clean or "Sam" coming clean.
Sorry for the perceived implication.
I place most of the blame for the lack of clarity, unreliable numbers,
and unfolding SoWa problems upon the PDC.
However, the current worsening circumstances continue to provide opportunities for Sam's leadership to emerge as demand for better oversight and scrutiny has never been greater.
Posted by: Steve Schopp | Mar 21, 2006 4:34:17 PM
Sam officially resigned as Vera's Chief of Staff on August 15, 2003.
Two days earlier, on August 13, 2003 the below Agenda Items came before City Council:
*953-1 Adopt findings to approve an alternative contracting process and create an exemption to the competitive bidding of ORS Chapter 279 for the Marquam Hill Aerial Tram Project General Construction and Tramway Equipment Procurement (Ordinance 177795)
*958 Authorize agreement with Portland Aerial Transportation, Inc. for design, project management and expert tram advisory services for the Marquam Hill Aerial Tram (Ordinance 177797).
A cynic might argue THE FIX was already in, and that Sam was an integral part of creating the multi-party quasi-governmental quagmire that he's now sinking into.
Posted by: Alice | Mar 21, 2006 9:36:12 PM
Roland says: "Sam still believes that while the tram has not been well managed, the overall South Waterfront development -which ensures that OHSU (the largest employer in the city) expands within the city of Portland and which increases the future tax base for the city substantially - will be worth the city investment up to this point."
I don't think this point has been discussed enough. For all the cost-overruns, mismanagement, and lack of life cycle costs - which, yes, are bad things - this project must continue (as Roland has pointed out) and is serving as an anchor to one of Portland's best tenants. I don't know how likely it would be for OHSU to relocate outside the city bounds due to lack of elbow room (big employers certainly do relocate on occasion), though if that was ever a possibility I would take the current situation over Pill Hill becoming the State's newest ghost town anyday.
Posted by: Stephen | Mar 21, 2006 11:43:09 PM
Locating a hospital on a ravine rutted hillside was their first mistake.
Building out the location until
parking demand outstripped supply was their second mistake.
Persuading Portland to build a Tram to connect OHSU to their new parking lots ("biotech" expansion) was their third mistake. Will new biotech and healthcare jobs be created? Maybe: but they will be outnumbered 10 to 1 by new parking spaces.
The new Genentech Facility in Hillsboro will have more impact on biotech growth in Oregon than anything in SoWhat.
Posted by: Alice | Mar 22, 2006 6:57:55 AM
While I do not know where Alice resides, this is why I feel people outside of Portland should really preface their comments. I don't know any Portlander that truly wants to chase off their largest employer. I don't know any Portlander who doesn't think subsidies are important to continue to build a world class research organization. I don't know any Portlander who doesn't want to see PSU and OHSU become larger regional institutions. I don't know any Portlander that would rather see OHSU expand in the burbs than in our own city. I don't know any Portlander that is against OHSU's mission, or the good they do for our community, both inside Portland and for the entire region being one of only one of two trauma centers. I don't know any Portlander that thinks doctors are poor citizens. I don't know any Portlander that thinks a brownfield that has sat vacant for decades outside of downtown are negative when turned into sleek towers, a regional campus that connects three universities (OGI, OHSU, PSU), spectacular Willamette riverfront parks, better Salmon habitat, and green principles in all the buildings that are rising.
I understand the funding issues with the tram. I see people pointing fingers at everyone for a relatively small amount of money, compared to other projects in this city as well as nationally. I see people who don't live in Portland complaining about how Portland spends their money, when the tram, if the city indeed spends $10mil out of general funds money (which it is not), comes to roughly around $18 per person. I don't see the outrage in that number especially when the federal government just took a $30,000 loan out on the heads of every man, woman, and child in America on top of the loans we already owe.
The tram was poorly planned. There was some shady information withheld by irresponsible people that got the numbers wrong and didn't come forward even though they knew it. That doesn’t diminish the good this project can and will do. In ten years it will be more appropriate to judge the tram, SoWa, biotech in Oregon and our current community leader's decisions.
Posted by: MarkDaMan | Mar 22, 2006 9:40:29 AM
Mark,
You continue to claim that anyone who is opposes your viewpoints must be from out of Portland. This is dead wrong.
You sure do know how to peg Portlanders. What did you post previously? That you've only lived here for 5 or 6 years?
Gosh you've rapidly become an expert on all things Portland. You know what, Mark, you need to expand your social network a bit beyond underemployed creative class leeches.
I live in Portland. For a lot longer than you have, thank you very much. And I think the OHSU bluff was completely empty. Would a state funded institution spend a billion or more to rebuild a campus in Hillsboro and abandon Pill Hill? Hogwash.
Anytime you want to play poker, let me know. I need the money.
Posted by: john | Mar 22, 2006 12:47:44 PM
MarkDaMan might as well be OHSU's community relations chief Lora Cuykendall wife of none other than Bob Caldwell, editor of the Oregonian editorial page.
His, rather their, wholesale misrepresentations and public deceptions are unethical. Attempting to neutralize the legitimate criticisms with baseless claims and blatant omission of the most egregious outcomes makes them thoroughly discredited propagandizes.
And Portlanders aren't falling for it.
Posted by: Winston | Mar 22, 2006 2:16:02 PM
John mistakenly said "What did you post previously? That you've only lived here for 5 or 6 years?"
no I said I moved back. I am a native Oregonian and have spent most of my young life in Portland.
John mistakenly said "You know what, Mark, you need to expand your social network a bit beyond underemployed creative class leeches"
So you know nothing about me, but feel you can insult me? That should tell everyone here that you have no point, are attacking me because of my views, and don't share in the spirit of honest dialogue.
I do have a job and have had the same job in Portland for almost 4 years. I found the job while the unemployment rate was over 7.5% and my experience was minimal at best. I've been putting myself through college and currently have been promoted twice within the organization I work for. Most of my friends own their own homes and are in their 20s, we have cars that are paid for, and live frugally but not in poverty.
I did not claim that everyone that opposes me lives outside of Portland, but I also cannot ignore the CPI's presence on this site. Since Steve is based in another city, and so is the Conservative Propaganda Institute, I have to question how many commentors that are opposed to Portland, OHSU, and PDC actually are located in this city.
Anytime John you actually want to present something other than personal attacks, I'm willing to listen.
Posted by: MarkDaMan | Mar 22, 2006 3:55:23 PM
funny guy Winston claims "MarkDaMan might as well be OHSU's community relations chief Lora Cuykendall wife of none other than Bob Caldwell, editor of the Oregonian editorial page."
If only, but funny thing is, there is no scandal here. I don't work for OHSU, have nothing to gain from the tram, other than a better Portland economy, and don't write well enough to get my comments published in the Oregonian.
I do value higher education as I strive to put myself through it. I value hospitals as they have saved the lives of many people I love and I have a tremendous amount of respect for doctors because without them, we'd be a pretty sad, sick country.
It's too bad people like you are trying to demonize Portland largest employer, are only research institution, and our chance at becoming a small scale worldwide biological player. What are your motives Winston?
Posted by: MarkDaMan | Mar 22, 2006 4:01:20 PM
Mark - I'm interested in learning more about the CPI and their motives. Any info to pass on?
Thanks
Posted by: Stephen | Mar 22, 2006 4:14:31 PM
Go here: http://cascadepolicy.org/
But what's the point? You'll just continue to believe big government knows better than the private sector.
Who knows, maybe you'll get enlightened. I'll try to hold out hope for you.
Obviously, Mark is unsalvageable.
Posted by: Chris McMullen | Mar 22, 2006 4:59:39 PM
Thanks for the link, Chris. I hope my posts haven't given the impression that I think big government knows best. Really, I've only talked about two issues on this blog: alternative transportation (which I'm a fan of, but not to the extent that road maintenance is neglected) and the fact that I think OHSU is a valuable addition to Portland, so I'm not sure how you can have me pegged as an unenlightened, one-track thinker.
Oh well, here's hoping your ability to hold back judgement on people isn't so unsalvageable as you make Mark out to be.
Posted by: Stephen | Mar 22, 2006 5:38:06 PM
MarkDaMan:
I've lived in SW Portland (near Lewis & Clark) since 1995.
I left the Democratic Party in 2001 and registered Republican (my spouse has always been an Independent).
We are both sick of all the horse trading and back room deals that define City and County politics.
The City that Works is not working for us: the Tram is just the most glaring example of corruption and "planning" run amok.
Posted by: Alice | Mar 22, 2006 6:04:05 PM
CPI is in downtown Portland and they do some good work.
Cascade Policy Institute
813 SW Alder Street Suite 450, Portland, OR 97205
Tel.: (503) 242 - 0900, Fax: (503) 242-3822
Posted by: Mildly liberal but sane | Mar 22, 2006 8:41:54 PM
Alice, your post about the dates of the tram/NM hearings in relationship to Adam's participation is correct. Many times as Katz's Chief of Staff Adams was directly involved in the land use issues of NM and tram. I hope Adams can remember this and begin to correlate this with position he has taken on the tram-no more taxpayer's money.
And I hope he listens to the city attorney that the city is not obiligated to build the tram and pay for the cost overruns.
Posted by: Lee | Mar 22, 2006 8:44:32 PM
Alice | Mar 21, 2006 9:36:12 PM . . .August 13, 2003 the below Agenda Items came before City Council:
*953-1 Adopt findings to approve an alternative contracting process and create an exemption to the competitive bidding of ORS Chapter 279 for the Marquam Hill Aerial Tram Project General Construction and Tramway Equipment Procurement (Ordinance 177795)
*958 Authorize agreement with Portland Aerial Transportation, Inc. for design, project management and expert tram advisory services for the Marquam Hill Aerial Tram (Ordinance 177797).
Roland | Mar 21, 2006 10:23:36 AMThe issue is that the city said it would be the contractor for the project and that the original agreement did not have any provision for cost-overruns. OHSU and property owners would foot the bill (for a set $15, then $40m) while the city would actually build the project.
JK:
What kind of lawyer would draft a construction contract without a cost over-run clause? The lawyers I have dealt with always wanted to consider every conceivable event, why didn’t a big time city lawyer do the same? Malpractice?
When you combine this with a no-bid contract and Portland Aerial Transportation, Inc, then it smells of something far worse. Surely they knew there would be massive cost over-runs. So what to do? Carefully design it so that the city would be stuck. No one would really care because the fixer would keep the public reaction down and the O wouldn’t care. A rapist and buddies would get rich. Again.
A question about timing: When were the contracts issued for those tram parts allegedly on ship(s) headed here? Seems to me that the cost over-runs should have been known before they issued those contracts, assuming that a price was part of the procurement contract. Or was there funny business here too?
Roland | Mar 21, 2006 10:23:36 AM But I don't know exactly how the agreement was drafted up or who did it.
JK: Shouldn’t we find out? Maybe we could ask them to draw a few mil from their malpractice insurance or their kids college fund.
Is it time for the U.S Attorney yet?
BTW, how is the mall rip up doing? Is it going to be on budget? How much is the city spending on this one? And who gets the massive profits?
Thanks
JK
Posted by: jim karlock | Mar 23, 2006 7:14:53 AM
Roland -
Since Commissioner Adams has neglected to answer the questions I posted under his "Blog: 200+ Attend Tram Town Hall" post, perhaps you can take a moment to take a stab at them?
After reading your posts, I'm particularly interested in whether you believe that the North Macadam area would not have been developed save for the current plan....
Posted by: Larry | Mar 23, 2006 8:46:43 AM
My neighborhood association sponsored a City Council, County Chair and County Commission candidates fair this past Tuesday evening. Amanda Fritz, one of the City Council candidates stated that she was on the Planning Commission when the tram was reviewed. At that time, the projected cost was presented as 9 million dollars. At the public hearing on tram approval in Council Chambers, the planning commission’s recommendation to the City Council recommended further study rather than approving the project. As we all know, that recommendation was ignored. At the very least, the 6 million dollar cost increase from 9 million dollars to 15 million dollars should have raised some red flags. As we all now know, neither were accurate. Attending the hearing myself, the feeling was the tram was a done deal from the start, no matter what the cost, and before any citizen input or participation.
JK brought up transit mall reconstruction. Based on a 30 year old plan, ramming light rail up and down the mall was also a done deal right from the start. I also attended this public hearing. Citizen participation was only window dressing to hash over the details. There are even some Tri-Met employees who think the mall is the wrong place for light rail. It will only slow down all transit service through downtown Portland. The question must be asked, why won’t the City Council listen to the people, including transit supporters, calling for an independent review of this project before construction gets started? The City already has one fiasco with the tram. Taxpayers can ill afford yet another debacle with the mall.
Posted by: Terry Parker | Mar 23, 2006 4:11:26 PM
I understand why people who live on Lair Hill, especially Gibbs Street don't care for the Tram. But why the fuss over so little money? PDC spends 100 times that much each year in 12 different URAs around the city; mostly on projects that produce few if any jobs; nice projects but none that produce the ROI the Tram already has.
Bottom line...OHSU is our only research institution of note; it is the largest employer. If you care about Portland's economic future, you had better help OHSU grow.
Posted by: Lenny Anderson | Mar 24, 2006 11:03:33 AM
"In ten years it will be more appropriate to judge the tram, SoWa, biotech in Oregon and our current community leader's decisions." Ah, yes. And by that time several more scandals will likely have been finessed as I am now reading on this discussion board.
The hidden cost of completing the tram is that it is a teaching lesson, and the lesson it teaches is that misrepresenting cost is not sufficient to stop an overpriced project. That lesson will not be forgotten, no matter how many glittering promises and reams of new regulations are written. Fraud, once accepted, tends to become institutionalized. Let me guess. This is not the first overrun in Portland.
Posted by: Marvin McConoughey | Mar 24, 2006 4:13:28 PM
Lenny said,
"""Bottom line...OHSU is our only research institution of note; it is the largest employer. If you care about Portland's economic future, you had better help OHSU grow."""
Suppose Larry that the Crap shoot in SoWa is not what OHSU should be doing.
You seem to be stuck in a time warp
back to when 10,000 biotech jobs was still the daily chant.
Have you learned and considered All of the information available or are you engaged in something misguided or misleading?
It's quite possible OHSU has mismanaged down a crap shoot path that will pencil out as well as the $15 Tram or the rest of the SoWa budget now hopelessly obsolete.
Perhaps you have never seen the SoWa budget or any of the current costs and progress.
It is unimaginable that someone who does have the full awareness would be making the remarks you do.
I expect the hype and defense from the parties involved but why you?
Can you explain your motivation and basis behind your position?
If it's limited to only a feeling you have or yo have special inside info please let us know.
Posted by: Steve Schopp | Mar 24, 2006 7:18:31 PM
Marvin - I think this tram is the proverbial "straw that broke the camel's back" for a lot of folks. This City has far too much taxable assessed value (nearly 15% of the total, I've heard) tied up in urban renewal districts - property taxes diverted from paying for schools, cops, judges & jails. We are seeing now what that is doing to our schools. This City government is too enamored with development - to the detriment of basic services. Urban renewal, like many things in life, is best taken in small doses.
Posted by: Mr. Magoo | Mar 24, 2006 7:19:23 PM
Steve Schopp,
What exactly does "crap shoot" mean in this context, and are you really a loyal Lars Larson listener?
http://www.pbs.org/now/printable/transcript307_full_print.html
Posted by: mannequin x | Mar 25, 2006 12:10:54 PM
Oh Magoo, you've done it again. Seriously, your comments about urban renewal districts are right on target.
Posted by: Terry Parker | Mar 25, 2006 1:30:40 PM
There's been some good relevant question asked here that have yet to be answered by the host.
Instead we are getting some of these annonomous distractions.
"""What exactly does "crap shoot" mean in this context""""
A reckless risking of millions, mostly other people's money, on the long shot of getting 10,000 biotech jobs.
Are you up to speed on any of this?
"""" and are you really a loyal Lars Larson listener?"""""
What exactly does "loyal" mean in this context?
What exactly does Lars have to do with the SoWa obsolete budget, the Tram urban renewal, TIF or anything on this blog.
You must be, while hiding your identity, trying to help cover up what is happening in SoWa the PDC and Urban Renewal.
Otherwise you might be bringing something of substance to defend what you apparently don't even want discussed.
Here's a couple new tid bits to chew on.
The 1999 approved SoWa plan called for $9.8 millioh in expenditures for FY 05/06
The current number for this FY is $27 million.
SoWa has also exceeded it's interum maximun indebtedness and IMO will soon run out of money for the projects and public improvements (which are far behind schedule,overbudget and underfunded) before the Increment grows enough to allow further indebtedness and progress.
And anyone with more information or questions can e-mail me directly at
stevescare@aol.com
Posted by: Steve Schopp | Mar 25, 2006 7:30:06 PM
Hey, I'm just stating the obvious...OHSU is the City's largest employer and offers real jobs with benefits, not Walmart jobs.
Why wouldn't we spend $3.5M or even $10M to help it grow and put more people to work? We spend a lot more TIF dollars elsewhere on job growth with poorer prospects.
OHSU is the only research insitution we have that approaches the upper tier.
Anyone in the know on economic development knows that in this century knowledge and innovation is essential if you want to be a player. Without R&D even Gunderson and Freightliner are dead in the water. Adding infrastructure to facilitate more R&D is probably the best investment of public money there is.
Posted by: Lenny Anderson | Mar 27, 2006 10:27:41 AM
Lenny - What do you think happens if they don't build the tram? I am curious.
I wouldn't worry, it will get built anyways based on how they are going top speed now.
Posted by: Steve | Mar 27, 2006 7:42:22 PM
Lenny, as so many blogs have pointed out, the taxpayers cost isn't $3.5M, or $10M. The direct costs in taxpayer money for the tram have mounted to over $21M and growing. You'll probably be hearing soon about some additional costs for the tram, indirect costs or hard costs that keeps adding to OHSU's benefit. And maybe that is fair for an institution that has so many jobs.
But is it fair to the WMCA at Duniway Park or to the RiverPlace Athletic Club to have to compete with OHSU's Health Club being built in NM that doesn't pay prop, tri-met taxes, etc. and is receiving $5M from TIF for biotech design, but not one biotech job?
Did you know that OHSU at this date has only contributed approx. $2.5M to the building of the tram while the construction expenditures has reached $30M; and that the NM LID hasn't contributed any dollars because of LID lawsuits? That means the taxpayers (the city) has had to borrow in bonds over $20M to continue construction. And the PDC claims there is no "financing costs" for the tram. As this becomes messy, the taxpayers are on the hook for the $20M so far borrowed.
This tram deficit now has seriously affected the SoWhat Urban Renewal budget for other projects. It is presently over $100M in debt in just the next five year proposed budget; beyond what the UR District can legally assume debt for. The taxing income isn't keeping up with the expenditures.
Beside the "big picture" the tram represents about how the city goes about all our "partnerships", the tram also is seriously affecting NM UR District.
Posted by: Lee | Mar 27, 2006 8:47:01 PM
Hey Schopp,
For a guy who doesn’t even live in the City of Portland, you sure spend a lot of time bitching about how we spend our taxes. What business is it of yours if the citizens of Portland decide to tax themselves to build the streetcar, aerial tram or roads and sewers in the South Waterfront?
Here’s an idea: If you think money is wasted on public transit, why don’t you and your neighbors in Tualatin, Tigard, Beaverton or wherever you really live form a local improvement district and tax yourselves to add a lane to the freeway of your choice. Until then quit whining.
Posted by: mannequin x | Mar 28, 2006 6:26:21 AM
hey mannequin x<
When did the "citizens of Portland decide to tax themselves to build the streetcar, aerial tram or roads and sewers in the South Waterfront"?
Your display of near total lack of understanding on these issues makes you appear naive and misguided.
As with so many costly misadventures there has been no public decisions or votes on the Tram or SoWa.
Furthermore, you don't speak for Portlanders and Portlanders are not the only funding source for these reckless schemes.
Fed, state and regional dollars are included in the mix with regional significance and concerns on many fronts make this everyone's business.
Apparently you join others here who prefer the public not only do NOT get to vote on these matters but are prevented from discussing the gory details.
Who cares where the information comes from as long as it gets out.
I know many Portlanders of all political stripes who are disgusted at the diverting of basic services property taxes to fund these private developments.
$20 million this one fiscal year are being diverted from school funding alone, in Portland because of Urban Renewal.
That $20 million reduces the State common school fund and lessens the funding for all 198 districts in the state. As does ever other UR in every city.
I am in close contact with Portlanders who are studying the problems.
Just because you know nothing about them and the issues doesn't mean those that do are simply whiners.
Next time you anonymously shoot at me, as if I am the problem, bring something with you to contribute.
Posted by: Steve Schopp | Mar 28, 2006 9:07:26 AM
How many of these new OHSU high tech jobs will be filled by people already living in the Portland Metro area thereby making a significant impact on high regional unemployment? The other side of the coin, and highly likely, is the reality these jobs will be filled by new comers brought into the area by OHSU whom will require more infrastructure, housing and services, all of which will uncouthly be subsidized at taxpayer expense.
Posted by: Terry Parker | Mar 28, 2006 10:43:32 AM
Steve, you still didn't answer his/her question.
For a guy who doesn’t even live in the City of Portland, you sure spend a lot of time bitching about how we spend our taxes. What business is it of yours if the citizens of Portland decide to tax themselves to build the streetcar, aerial tram or roads and sewers in the South Waterfront?
I'm curious.
Posted by: MarkDaMan | Mar 28, 2006 12:55:07 PM
Mark
Read my last answer. It's not the Portland citizens deciding and it's not only Portland money involved.
There are many issues of "regional significance" (as Metro likes to say)
regarding SoWa and other misadventures.
Your problem is two fold.
One you haven't a clue what you are talking about and
Two, you are deluded in thinking Portlanders approve of these misadventures.
And as usual you brought nothing but distraction.
Posted by: Steve Schopp | Mar 28, 2006 2:26:03 PM
A couple of thoughts/responses...
South Waterfront with its Tram was a favorite project of our former Mayor who got easily re-elected twice. That should say something about who represents whom.
Urban Renewal Areas (URAs) typically run up a lot of debt in the beginning, before new tax money rolls in. SoWa is taking off so much faster than anyone anticipated that cash flow should be no problem. That said, the list of projects for public funds is always longer than is doable, so priorities need to be set. The Tram is literally lynchpin for the entire project, so it gets resources before parks, greenways, even affordable housing.
New jobs go to qualified people; if we continue to dis-invest in education as we have for the last 15 years, then many will go to new arrivals who have the needed skillsets.
OHSU teaches the next generation of medical professionals, provides ER care for the seriously injured, takes care of those in our community without health insurance as well as doing research. It may not pay property/business taxes, but it provides a lot of value to Portland. You'll be glad its there when you need it!
Posted by: Lenny Anderson | Mar 28, 2006 2:41:32 PM
Lenny,
The reality is that one of the undermining causes for the disinvestment in Portland schools is the fact that urban renewal districts siphon off dollars for infrastructure that in part would otherwise go to education. The life of these districts can be 20 to 30 years or more which is a long period of time when approximately 14 percent of the City’s land mass is part of urban renewal. Furthermore, the City keeps adding new districts and extending the life of existing ones. All this creates an unrecoverable funding gap. Add to that the fact that Portland property owners have an urban renewal bond charge on their property taxes which makes voters less likely to approve new school funding levies in addition to the high taxes they are already paying. Wages are not keeping up with inflation or the continual increases in taxes and other government charges such as sewer rates. The average Portland taxpayer/ratepayer is tapped out. Maybe with all your support for both urban renewal and moving freight, you can come up with a way for the freight hauling community to tax themselves to the tune of a few million dollars that would support education and bail out the loss to schools from urban renewal districts.
The simple fact is that urban renewal tax increment funding robs school funding along with other government services.
The simple fact is that urban renewal tax increment funding robs school funding.
Posted by: Terry Parker | Mar 28, 2006 8:53:17 PM
Lenny,
Do you get all your stuff from the Oregonian editorials?
If not you are making this stuff up and misleading whoever is reading it.
The only two ways you can spout this ridiculous nonsense is if you have never seen any of the original, interim and current budgets, projections and estimates.
Or you are deliberately being misleading.
I have the budgets and reports. I have studied them with others.
What they show is that you, the Oregonian and the PDC continue to "fool"
Commissioner Adams, city hall and the public, to a far greater degree than
was perpetrated with the $15.5 million Tram.
None of which is neutralized by either your rhetoric or "Vera being reelected twice".
"""Urban Renewal Areas (URAs) typically run up a lot of debt in the beginning, before new tax money rolls in."""""
No, they do every time. That's how they work. Borrowed money gets the project off the ground and TIF pays off the bonds over decades.
The Increment however has to be determined to be an amount capable of servicing the debt as the project proceeds as more borrowing ramps up. Project estimates and funding projections need to be reliable, sustainable and updated.
You have not looked at a single SoWa budget have you?
Who's fooling you?
"""SoWa is taking off so much faster than anyone anticipated that cash flow should be no problem""""
Who told you that? Who asked you to say that?
What's your motivation for such a complete and total fabrication?
You might as well be telling people the Tram is only costing $15.5 million.
Posted by: Steve Schopp | Mar 29, 2006 9:56:38 AM
Steve,
Please tone down the rhetoric and personal attacks.
Argue on your perception of the facts, don't try to SwiftBoat people by questioning their motivations and saying that they are making up "total fabrications" to mislead and fool people.
I understand you are passionate about this stuff, but the basis of democracy -the public debate of ideas- breaks down if the debate isn't civil.
Cool it.
Posted by: peter | Mar 29, 2006 10:24:31 AM
Peter,
Or whoever you are.
The facts speak for themselves. No perception needed.
The "basis of democracy -the public debate of ideas- breaks down" when distortion, misrepresentation and outright falsehoods are offered as facts.
Pointing it out doesn't.
If you have nothing but that lame lecture I'll assume you are among those doing the misleading. Either unintentionally or deliberately.
It isn't civil to deceive the public.
Posted by: Steve Schopp | Mar 29, 2006 11:33:46 AM
and yet Steve, you still don't answer the question.
You said something about "regional significance" but still didn't explain how that affects you and than,
"""One you haven't a clue what you are talking about and
Two, you are deluded in thinking Portlanders approve of these misadventures."""
but personal attacks aside, I'm curious,
For a guy who doesn’t even live in the City of Portland, you sure spend a lot of time bitching about how we spend our taxes. What business is it of yours if the citizens of Portland decide to tax themselves to build the streetcar, aerial tram or roads and sewers in the South Waterfront?
We've read your opinions, some might agree with you, some might not, why can't you leave it at that?
The more Portland screws up, the better it is for your community. Right? The exodus of families in Portland means steady growth in your school district, additional funding for your schools, and your favorite, more sprawl to accomidate the additional families. I think you would be elated to see Portland crash and burn.
I tend to believe the real truth is Portland isn't going to crash and burn. Last time I checked, Portland had a respectable credit score of around 686.
www.nationalscoreindex.com
http://moneycentral.msn.com/content/Banking
/Yourcreditrating/P80782.asp
That means our credit score is higher than the national average and equal to New York. It is also higher than San Francisco, Chicago, Phoenix, LA, Houston, and Denver; just to name a few. Cities that I would argue, aren't poised to crash and burn.
If you are going to continue to present the same tired tidbits, I do wish you would quit your George Bush "you agree with me or you are a terrorist" type hysteria. You've made it clear that if we don't agree with you, Schopp, we can than only spout "ridiculous nonsense" and are "deliberately being misleading." We "haven't a clue what we are talking about" and "display near total lack of understanding."
Very Bushie...
Posted by: MarkDaMan | Mar 29, 2006 11:46:43 AM
It may well be worth a re-examination of tax increment funding, but note that by state law no more than 15% of a jurisdiction's taxbase and/or land area can be in URAs. Also only the increment is shifted to projects within the URA, so taxes from the baseline year continue to go to the general fund, etc.
If the area included in a new URA is largely vacant, generating little tax, then a good case can me made for public investments that bring private investment into play. Jobs are created, housing built and projects of regional significant and/or value (Waterfront Park for instance) are the result. At some point...depending on extensions, bonding levels, etc..., the tax increment returns to the general fund.
But its a fair question to ask, what would have happened to an area without a URA? NW 23rd Avenue re-developed itself, driven by the market. Could the same have happened in the old rail yards in the River District URA? And over what time frame and with what public amenities?
Opponents of TIF should weigh in on the proposed extension of the Central Eastside URA. I think extensions should be the exception, not the rule.
What projects are funded within a URA are largely the result of the push & pull between the CAC (if there is one) and PDC/City Council. The former tend to favor local needs while the latter insist on regional projects, like New Columbia or Interstate MAX.
Should we have URAs at all...it is easy enough to see results, both positive and negative on the ground. I'm no fan of South Auditorium, but am pleased to see the gradual re-development along Interstate Avenue. By just about any measure, especially jobs and private investment, South Waterfront must be considered a success. And public dollar amounts invested in the Tram are really peanuts.
Posted by: Lenny Anderson | Mar 29, 2006 11:52:44 AM
Lenny (and all other Tram apologists):
We need at least $10 million worth of "peanuts" in order to close the current Tram funding gap: it will probably be closer to $15 million by the time it's completed (including legal and other soft costs).
Can you identify $10 million in general fund expenditure reductions, or would you prefer we let the PDC fairy godmother create $10 million out of thin air?
I am amazed at the naivete expressed by the current proposal: maybe OHSU thinks the PDC has a printing press in their basement, and they can just manufacture money upon request.
Posted by: Alice | Apr 1, 2006 10:12:38 AM
MarkDaChild:
Consumer credit scores have nothing to do with the credit rating of the State of Oregon or the City of Portland.
They are totally different measures with totally different criteria.
Experian doesn't rate the credit worthiness of municipalities: the score you reference (686) is an aggregate score for the people who live there (totally distinct from any government's credit rating).
Posted by: Alice | Apr 1, 2006 10:19:41 AM
Mannequin, MarkDaMan:
If you studied the proposed 5 year budget for NM, a high percentage of tax dollars proposed to be spent are federal and state dollars. These dollars are beyond the $500M of TIF money (local, Portland taxpayer's money).
For example in transportation projects for NM almost every project is funded with Fed and State dollar-$40M in fed dollars just for the I-5 off ramp.
Medium Income Housing is mostly fed/state dollars,
The Neighborhood Improvement Projects of $52M (Lair Hill, Ross Island/Naito Bridge Head, I-5 pedestrian bridge, etc.} are so far only funded with $11M of fed/state dollars-the remaining balance of $41M is "unfunded".
All of these numbers you can get from an earlier post from the 19 page PDC Proposed budget.
Now, I believe that NM URA and other URAs give other Oregonians the opportunity to comment on this subject since their federal and state dollars help pay for Portland's URAs.
Steve explaination about how any URA anywhere in the state affects each taxpayers dollars in how they are distributed and affects all of our school districts is correct. I believe he answered your question and I hope this helps.
Posted by: Jerry | Apr 1, 2006 9:30:17 PM
Alice, perhaps you should change your handle to "AliceDaMalice".
Now that would be appropriate.
Too bad I couldn't fit "rich west hills bitch" in there.
Posted by: YoungnativePDXer | Apr 2, 2006 7:39:16 PM
Post your comment
Please note: your email address, although required to post, will not be visible. We remove inappropriate or offensive content, and content deemed improper by State and City election and ethics law. The comments posted do not necessarily reflect the views of the office or the City of Portland.
Informative??? Informative about what??? That lots of steel and concrete are going into this SNAFU? Informative to do a smoke and mirrors presentation that doesn't address the issues of the cost overruns or the question about how much it will cost to run and maintain this fiasco - or where THAT money will come from?
And as all this "nothing-up-my-sleeve" presentation sucks up time, they have the construction crews working like crazy to get to a point to where we finally DO cross the line of "it's too expensive NOW to back out".
As I've said over and over, the cost doesn't matter; the ONLY thing that matters (to city hall) is that it WILL get built - PERIOD.
Posted by: Mmmarvel | Mar 20, 2006 6:16:01 PM