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Falls Legacy LLC still owes $285,000 for delinquent accounts related to the 23-acre site in Oregon City

After a long impasse, public partners are cautiously optimistic that the developer will continue to work toward fulfilling his obligations under an easement agreement for construction of a walkway to Willamette Falls.

JONATHAN HOUSE - A public riverwalk in front of the old Blue Heron paper mill is delayed, impacting the redevelopment of the area as part of the Willamette Falls Legacy Project.Private property owner George Heidgerken signed permit applications to the U.S. Corps of Engineers and Oregon City that give the public partners the legal right to proceed with constructing Phase 1 of the Riverwalk. Heidgerken signed the permits after an approximately four-hour meeting March 19 with Willamette Falls Legacy Project Manager Brian Moore and Oregon City Manager Tony Konkol at City Hall.

Heidgerken's company still owes a total of about $285,000 for delinquent accounts related to the 23-acre Willamette Falls site. Falls Legacy LLC owes the county more than $46,300 in back taxes, more than $39,000 to Oregon City for years of unpaid utilities and, to the public partners as a whole, another $200,000 for a past-due payment he agreed to under the terms of the easement agreement.

Doubling down on a Feb. 23 letter to Heidgerken, the public partners are still demanding that he pay off his debts before they will proceed with the permit applications. A joint permit application to the U.S. Army Corps of Engineers would kick off a Section 106 process taking up to nine months and costing the partners an estimated less than $50,000 in permit fees and staff time.

PHOTO COURTESY: METRO - George Heidgerken and Jim Desmond shake hands to finalize the signed agreement between the developer and Metro in 2014.The partners' position could remain tenuous even after they submit the signed application to the Corps for federal mandates on how cultural and historic resources should be handled throughout the construction of the riverwalk. Heidgerken could at any time revoke his signatures on the permits for the construction simply by writing to the city and the Corps to pull the permits.

Konkol said he received the assurance of Heidgerken that the partners would by April 30 receive everything that they're owed.

"Based on the meeting that we had with him Monday, he is in support," Konkol said. "He expressed his support for the project, the four core values."

Additional signature from developer?

Heidgerken's March 21 letter to Moore said he's wired funds to a lender in an effort to make good on what he owes the public partners.

"We wired funds to our lender yesterday enabling them to proceed with a fast track appraisal of the office building," wrote Heidgerken. "We are also seeking funding for the remaining property that will enable us to move forward with the detailed master plan necessary to move this project forward. As I expressed to you and Tony we are finally for the first time able to seek funding without resistance from my partner."

As previously reported, Heidgerken told the public partners that their offer amount was less than his December buyout of his business partner "based on our assessment of a fair market value," so he wasn't interested in selling the property. Heidgerken and the partners have both declined to publicly disclose the partners' recent offer amount, but the partners had at least $5 million from the state; Heidgerken paid $2.2 million in bankruptcy court for the property in 2014.

News media were permitted to attend a March 21 meeting of the partners, but under state law, journalists are not allowed to report on the deliberations in the executive session held to conduct a confidential real-estate transaction. In attendance at the executive session were Moore, Martha Bennett and Tom Hughes of Metro; Konkol and Dan Holladay of Oregon City; Paul Savas and Don Krupp of Clackamas County; and Raihana Ansary and MG Devereux from the state of Oregon.

After the executive session, Metro President Tom Hughes called to order a public work session and announced the breakthrough of getting Heidgerken to sign the permits. Hughes explained that Heidgerken still will have to pay his debts before the project moves forward.

"If all the conditions are met, staff has permission to move forward," Hughes said.

Not so fast, said Oregon City Mayor Dan Holladay. He and other partners are considering an additional requirement that would bring more assurance to the public that the developer wouldn't hold up the project again.

During the March 21 work session of the partners, Konkol discussed whether there are options for making sure that the developer doesn't rescind his signatures on the project. Konkol said attorneys from the city and Metro will be meeting next week to determine whether a document could be created that, if signed, would legally bind Heidgerken to allowing project to be completed.

Hughes said that the public partners may have to have an emergency meeting if the requirement to sign the document isn't met and the other requirements are met.

WFLP - Artist rendition of Riverwalk concept at the Willamette Falls Legacy Project, which has hit a snag.

Concerns moving forward

Heidgerken said his recent meeting with Moore and Konkol "went a long way to instill the predictability they all require in order to invest in this project." Falls Legacy has expressed concerns about trees potentially blocking views of the river from Heidgerken's conceptual hotel development. At the March 19 meeting, Konkol said he told Heidgerken that both the Corps and Oregon City's Natural Resources Overlay District could have requirements regarding the tree planting, for example.

"I can't guarantee him something I don't control," Konkol told this newspaper.

If the developer wants to construct a hotel above the Willamette River, he would have to submit his own permit to the Corps.

As for the riverwalk, it would take Oregon City staff an estimated four months to shepherd the project through the local planning process, which could take place concurrently to the application to the Corps, speeding up the timeline from two years to 18 months from permit application to project groundbreaking.

Construction drawings, the most expensive step prior to a ground breaking, would start after a signed memorandum of understanding between the Corps and property owner for addressing how the impacts to cultural and historical resources at the site could be mitigated throughout planning and construction.

Moore acknowledged that the partners are currently vulnerable to Heidgerken once again holding up the project. But he says that they are being judicious with public funding by waiting until Heidgerken's debts are paid before proceeding with permit applications for the riverwalk. He added that every time the partners get another signed document from Heidgerken, there's more assurance for both sides.

"Each time it moves in the right direction, it's safer," Moore said. "In general we want to stack many, many more wins in terms of the property owner demonstrating his commitment to the project."

Partners could also walk away from the project, if they get fed up with Heidgerken's antics.

"Just as easily as George could stop, we could stop," Konkol said. "I appreciate all the effort that Falls Legacy and George have put into working with us."

Other announcements

At the March 21 work session, the friends group made their own announcement. Andrew Mason, executive director of Open School for 22 years, will be starting as the full-time executive director of Rediscover the Falls Inc., replacing Shelly Parini, who is formerly an employee of Clackamas Community College. Also known as Friends of Willamette Falls Legacy Project, the nonprofit group hopes to raise $8 million through private contributions for the riverwalk by 2022.

Four videos were shown from various perspectives on the project: a tribal member, a PGE employee (who also happened to be a Bollywood director enamored with the falls as a filming location), a longtime advocate for the reopening of the Willamette Falls Locks and a former paper-mill employee.

CCC is hosting another free community Willamette Falls storytelling workshop starting 10 a.m. May 4. To register, visit willamettefallslegacy.org or email This email address is being protected from spambots. You need JavaScript enabled to view it..


Raymond Rendleman
News editor, Clackamas Review/Oregon City News
971-204-7742
email: This email address is being protected from spambots. You need JavaScript enabled to view it.
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