Judge to hear arguments in ratepayer suit against city
Water bureau spending related to two parks is being challenged in the final stages of the long-running ratepayer lawsuit against the City of Portland.
Multnomah County Judge Stephen Bushong is scheduled to hear final arguments about how much the City Council should repay the water and sewer bureaus on Friday. A little more than $20 million is under discussion. Of that amount, almost $2.6 million was spent at city-owned Dodge Park in Clackamas County and just over $11.7 million was spent at Powell Butte in Portland, where two reservoirs and a nature park are located.
Attorneys representing ratepayers say all the spending related to the parks was illegal because it benefits them more than the water bureau. According to a May 12 trial memorandum from the City Attorney's Office, Powell Butte projects included a $1.3 million caretaker's house and a $2.4 million interpretative center. Bushong previously ruled that ratepayer spending must be "reasonably related" to the missions of the bureaus.
"The city is still trying to justify illegal spending. It should just come clean and admit ratepayers shouldn't have paid for these projects," says ratepayer attorney John DiLorenzo.
But in the memorandum, the city argues that only $920,014 did not meet Bushong's standard at Dodge Park. The figure is even less, $842,531, at Powell Butte, the city says. The rest of the spending — approximately $12.4 million — either supports water bureau programs, was required by state land-use laws, or should not be counted for technical reasons.
Exchanges between the two sides became heated as the hearing date approached. DiLorenzo singled out the money spent on the caretaker's house in a May 8 letter to the City Attorney's Office. He said it replaced a manufactured home formerly used by a Portland Parks & Recreation employee to oversee the nature park at Powell Butte.
"It is time to regain the trust of Portland ratepayers," DiLorenzo wrote.
City Attorney Tracy Reeves wrote back in May 10. She accused DiLorenzo of threatening to try the case in the media and privately had said it would be "politically advantageous" for Commissioner Nick Fish, who is in charge of the water bureau, to concede the cost of the caretaker's house. Fish accused DiLorenzo of "political blackmail" in an email to the Portland Tribune. DiLorenzo says he merely said it would be the right thing for Fish to admit the money spent on the caretaker's house was inappropriate.
Defending the spending, the city attorneys say visitors to the Bull Run Watershed stop at Dodge Park during their city-approved tours. They also say the caregiver who lives at Powell Butte provides around-the-clock security for the reservoirs, and the interpretative center there educates people about Portland's water system and mitigates the environmental impact of reservoir construction. And the spending includes a $3 million-plus maintenance building that is mostly used by the water bureau.
Altogether, the city is only conceding it may have misspent around $6 million of the $20 million under discussion — including money spent on the public toilets known as Portland Loos, the now-defunct public campaign finance program, sending city bureau employees to New Orleans for Hurricane Katrina relief, creating "hydro parks" as city reservoirs, and paying for maintenance and other work undertaken by Portland Parks & Recreation employees.
"The city is committed to fulfilling its obligation to properly spend ratepayer funds wisely and efficiently, and is looking forward to full resolution of these issues through the judicial process," says Senior Deputy City Attorney Karen L. Moynahan.
Even if Bushong awards the ratepayers all the money identified in the memo, it will be far less than the more than $120 million their attorneys originally sought. He previously ruled that more costly expenditures — including over $50 million in sewer funds spent on the Portland Harbor Superfund cleanup process — were authorized by the charter.
"This lawsuit has dragged on for more than five years, at great expense to taxpayers. At this point, I have to wonder whether John is more interested in billing his time than actually litigating this case," says Fish. "We have great respect for the court, and trust the legal process John initiated to see us through. Our City Attorney will continue representing the interests of ratepayers and taxpayers — John's threats and bluster won't change that."
After Bushong finalizes his ruling, the city must decide whether to appeal the case or live with the "reasonably related" standard for spending he has declared.