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The City Council brushed aside neighborhood opposition and legal questions last Wednesday to authorize opening a large homeless shelter in a vacant warehouse at Terminal 1 for up to 18 months — or permanently if developer Homer Williams can raise tens of millions of dollars to expand it into a homeless multiservice center.

“Make no mistake. I support the larger vision of a campus for homeless people. But we’re taking it in baby steps,” said Commissioner Dan Saltzman, who oversees the Portland Housing Bureau and presented the proposal to the council.

The council voted 3-2 to authorize PHB to lease the 14-acre property at 2400 N.W. Front Ave. from the Bureau of Environmental Services, which owns it. Voting for the lease were Saltzman, Mayor Charlie Hales and Commissioner Steve Novick. Voting against it were Commissioners Nick Fish and Amanda Fritz.

The lease is for six months with two automatic six-month extensions, unless it is canceled. It begins Oct. 7.

The payments approved in the ordinance are $10,000 a month, but that was immediately challenged by Portland attorney John DiLorenzo, who says he will seek an injunction against the project unless the payments are raised to around $100,000 a month, which BES says is the market value of the property, which is zoned industrial.

DiLorenzo already is suing the city over alleged misspending of sewer and water ratepayer funds by the council. The judge hearing the case has ruled such spending must be reasonably related to the missions of the utility bureaus.

“It is obvious that the arrangement outlined in the ordinance deprives the sewer ratepayers of significant value,” DiLorenzo wrote to the City Attorney Tracy Reeve shortly after the vote.

Fish, who oversees BES, said the same thing during the hearing. That position was supported during the hearing by the Portland Utility Board and the Citizens Utility Board. Their representatives said the interests of BES ratepayers need to be protected.

Saltzman’s office declined to comment on DiLorenzo’s threat, saying it is a legal matter.

Terminal 1 currently is being sold through a surplus sales process approved by the council. Bids were due Monday. According to the broker assisting the sale, companies showing interest include a brewery, a movie and video production studio, a greenhouse operator, and developers of light industrial spaces.

Fish wants Terminal 1 sold to create family-wage industrial jobs, with the proceeds from the sale used to reduce future BES rate increases. He accused the council of paving the way for a single-source contract to develop the property for a nonindustrial use. Williams did not bid on it.

Few details offered

Wednesday’s hearing was the first time the proposal had been discussed publicly. Williams did not offer a budget for either a temporary shelter or a permanent multiservice center, but said they would be forthcoming once the property is secured.

“In my business, it starts with the land. In this case, in order to do what I think is necessary, we have to have a significant piece of property. It needs to be close to the city,” Williams said.

Williams said the temporary shelter could house up to 400 homeless people and will be operated by the Union Gospel Mission, explaining that a couple hundred thousand dollars already have been raised for the conversion. Williams originally said the larger project — modeled after the Haven for Hope in San Antonio, Texas — could accommodate 1,000 people or more. He said it would cost $100 million, with half the money coming from the private sector, but later lowered the estimate to $60 million.

Saltzman said no permanent changes will be made to the 96,000-square-foot warehouse or surrounding paved land while the shelter is temporarily opened. He explained that portable toilets, showers and propane heaters, instead, would be moved to the site.

The council will vote Wednesday on whether to seek a $100,000 Equitable Housing and Planning Development grant from Metro to evaluate the feasibility of Williams’ long-term plan for the site, which he is calling the Trail of Hope.

The Oregon Department of Environmental Quality has notified the city that Terminal 1 was only cleaned up to industrial standards when the Port of Portland sold it to BES to be used as a staging ground for the Big Pipe project. Residential standards are much higher. The notification said the city must involve DEQ in re-evaluating the property if the use is changed.

“In my eight years on the council, I can’t recall any precedent for an action like this. Let’s be clear, there is no plan, no funding, and there has been no public process and no due diligence,” Fish said.

Most testify against the shelter

The vote followed more than three hours of public testimony from around 50 people, most of whom opposed the proposal.

The largest group was residents of Riverscape, a large condominium and apartment complex just south of Terminal 1. Many from the group said they felt blindsided by the proposal because no one from the city had contacted them before it became public. Many said they feared for their safety or the safety of their children if hundreds of homeless people were going to be housed at Terminal 1, either temporarily or permanently.

Also opposing even the temporary shelter was Bob Sallinger, conservation director of the Portland Audubon Society. He said it violated policies to preserve industrial lands recently approved by the council in the Comprehensive Plan update, and warned it might prevent the plan from being approved by state land-use regulators, as required by law.

The project also was opposed by John Jensen, political director of the International Brotherhood of Electrical Workers Local 48, who said the property should be used to create industrial jobs. That view was echoed by Andrew Baugh, the chair of the Portland Planning and Sustainability Commission, who testified as a private citizen.

Several of those who testified against the proposal suggested opening the unused Wapato Jail owned by Multnomah County in North Portland for the homeless instead. The idea is opposed by Multnomah County Chair Deborah Kafoury.

Prominent supporters included: Williams; consultant Don Mazziotti, a former Portland Development Commission director working with Williams on the project; and former City Hall staffer Rich Rodgers, who is working on homeless issues, among other things.

Most of those who supported the proposal said they wanted more information about it, however. Some supported opening a shelter in the warehouse only over the winter, but not as a permanent solution.

Notably absent was anyone from Multnomah County or either of the city-county organizations working on homeless and affordable housing issues: The Joint Office of Homeless Services and A Home for Everyone.

According to Saltzman’s office, the next step is for the joint homeless services office to negotiate an operating agreement for the shelter with Williams’ Trail of Hope.

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