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My View: Give us a vote on public funds for bad hotel deal

Politicians avoid transparency, accountability in convention center project


On Dec. 19, Multnomah County commissioners made a major legislative decision. They voted to restructure how local lodging tax revenue will be allocated in order to approve the use of those taxes to pay off more than $60 million in public revenue bonds — payments totaling more than $100 million when the interest is added in — that Metro intends to issue to massively subsidize the construction of a privately owned convention center hotel.

There is a lot of public money at stake in this deal. The $60 million in bonds come on top of a direct $14 million subsidy and another $4 million in public loans that will be pumped into this risky hotel deal.

While Metro touts the contribution of Hyatt and the development team as being $120 million, the fact is they are putting in none of their own money and taking virtually no risk. Instead, they are mortgaging a public asset for their private benefit. That’s cause for concern, because similar convention center hotel projects in many other cities have flopped, leaving taxpayers on the hook for millions.

Here in Oregon, on controversial issues of such consequence, we have a well-established tradition of letting the voters have the final say. Our state’s initiative and referendum power is something we rightfully cherish.

But when our coalition of local hoteliers and other concerned citizens stepped forward to refer this massive public subsidy to the ballot, politicians at Multnomah County and Metro took the unprecedented step of blocking our effort, arrogantly claiming that their decision cannot be put to a public vote.

Right now, those same politicians are spending thousands of dollars in public funds to fight us in court in a desperate effort to avoid transparency and accountability. Metro President Tom Hughes, the chief author of this flawed hotel scheme, has even gone so far as to hire high-priced outside counsel, at a cost of hundreds of dollars an hour, to try to block the voters’ right to weigh in on this matter of public importance.

Plain and simple, his naked attempt to dodge public accountability is not just financially costly for taxpayers, it is wrong.

The Oregon System

Oregon’s initiative and referendum process has a storied history, for many years making our state synonymous nationally with the public exercise of direct democracy. Through the early part of the last century, the Oregon System, as it was known, led to a wave of progressive reforms: via direct public votes, Oregon became the first state in the country to popularly elect U.S. senators, to establish the first presidential primary election in the nation, and to create an eight-hour workday.

We should not restrict the right of the public to determine matters of substantial import because a few politicians don’t like their decisions to be questioned.

We believe strongly that the public should — and will — have the final say on whether to hand more than $100 million in public subsidies to build a privately owned hotel. We are confident not only that the law is on our side, but also that once the public gets a chance to review this backroom deal, they will agree with us that it should not go forward.

They will learn that Metro has structured this deal so that if the hotel succeeds, Hyatt will take all the profits. If it fails, the public will lose millions. They will learn that, contrary to Metro’s boosterish claims, a hotel of this size in that location is so risky that the private sector refused to build it — until Metro went behind closed doors to offer a highly profitable international hotel corporation huge subsidies.

They will learn that hoteliers in our coalition have no objection to privately funded hotel projects. Owners who are investing private capital tend to make rational business decisions. For example, there are many new privately financed hotel projects under construction and in the development pipeline in the Portland area. 

Those new projects create stiff competition; however, none of the coalition members are taking steps to oppose them because our members believe that everyone should be able to compete on a level playing field. 

In this case, the playing field becomes dangerously tilted when government creates a project that would never exist but for massive amounts of “free money” being handed to a private party.

Of course, that is exactly what the politicians at Metro and Multnomah County are afraid of. That’s why they want to shut down this debate, even if that means blocking the initiative and referendum right of the voters in the process.

At the Coalition for Fair Budget Priorities, we believe these politicians need to remind themselves that they work for the people, not vice versa. They should welcome public scrutiny of their decisions, not fight it.

Let’s uphold our tradition of direct democracy in Oregon. Let’s let the voters decided whether or not they want to hand millions in public funds to subsidize this hotel boondoggle.

In this state, it’s their right.

Paige Richardson is the campaign coordinator for the Coalition for Fair Budget Priorities, which opposes the Oregon Convention Center hotel deal.