New year, old tricks

Up Sucker Creek reported earlier about Metro's deal with a developer to help fund $60 million of a new convention center hotel using revenue bonds paid back with room taxes generated by the hotel.  (Borrowed money is always more than the principal, so $60 million is only what the developer would receive, not what the public would pay.)

The funding scheme is a variant of the urban renewal boondoggle, but instead of robbing property taxes to pay bonds, this one uses tourism taxes.  Not much of a difference, but if all our taxes keep getting diverted to politicians' development dreams, where will the money come from to cover basic services?  Think about that when you hit that next pothole while an urban renewal area (or hotel) is given wads of money.

Not surprisingly, hoteliers from Portland are not pleased with the preferential treatment given to one, hotel they would be competing against - government should not be picking winners and losers  Their attempt get a county-wide vote to stop county money from going to the developer was blocked by Multnomah County Commissioners.

This behavior sounds just like what the Clackamas County Board of Commissioners did with rail funds a couple of years ago - they borrowed $20 million for the PMLR project a few days before a vote that would have blocked the expense. This was one of the reasons Charlotte Leahan was replaced as Commission Chair.  Government these days does not want citizens voting on funding for their projects, and they are rightly afraid a public vote will block foolish, or unfair, or costly spending.  The political fallout will eventually hit Multnomah County, and when it does, will it spark a change for the region?  Metro cannot let voters anywhere have their say or their money house of cards would fall.  Hmmm...  the power of the purse in the hands of the public?  Dangerous, or democratic?
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Multnomah County blocks convention vote

At issue is $60 million public loan to fund hotel

PORTLAND, Ore. (KOIN) - The public will not get to vote on plans to build a controversial convention center hotel in Portland.

A group opposed to the $60 million public loan that would fund hotel construction wanted to bring the issue to a public vote. But Multnomah County blocked that plan Tuesday.

County officials said the basis for the group's ballot initiative did not meet legal requirements.

The opposition group calls the county's decision an attempt to avoid public accountability. They're planning an appeal.
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From NWWatchdog.org,  1/11/13
Taxpayer Money Sought For Oregon Convention Center Hotel

“This is what happens,” said Heywood Sanders, a professor at the University of Texas at San Antonia who tracks the convention center industry. “There’s a cycle here. You build a center, it under performs what the consultant said so you then say how do we fix it.”

And the answer is more often than not, build a hotel.

Sanders said the drive to push forward with publicly funded projects stems from political pressure to fix up downtown districts or drive tourism.

“They keep trying,” he said. “Failure never breeds a serious reconsideration of the strategy. It simply breeds trying it again or doing more.