Sam Adams touts plan for eastside streetcar
Financing - The commissioner is seeking $27 million from Portland urban-renewal districts
Wednesday, August 15, 2007
JAMES MAYER
The Oregonian
Portland City Commissioner Sam Adams pitched his plan to the City Council on Monday to squeeze three urban-renewal districts for the $27 million needed to complete financing for the eastside streetcar.
Mayor Tom Potter and Commissioner Randy Leonard, the only other council members present for the work session, didn't say where they stood on the plan, but Potter, in particular, seemed skeptical.
He sought assurances that the city wasn't heading for another debacle such as the aerial tram, in which poor council oversight led to large cost overruns.
"I am responsible to the voters for this project," Adams said.
The city money represents the last piece of the financing puzzle for the $147 million project, which would take the streetcar from Northwest Portland, over the Broadway Bridge to the Lloyd District, and then on Martin Luther King Jr. Boulevard and Grand Avenue to the Oregon Museum of Science and Industry.
If approved, construction would begin in September 2008, with service beginning February 2011. The line could be extended across the Willamette River to the South Waterfront area in the future.
Adams said the project could spark the kind of development boom on the east side that has accompanied the westside line through the Pearl, the west end of downtown, the River District and South Waterfront.
The route is expected to attract 2.4 million square feet of development and 15,000 new jobs, while reducing congestion and global warming, Adams said.
But it may come at the cost of delaying other important city priorities, such as redevelopment of the Centennial Mills site or building affordable housing in the central east side. And a proposed operating subsidy also features controversial elements such as reducing bus service and installing parking meters in the central east side.
"It's a good but tough project," Adams said.
The council will have little time to absorb the complex financing plan before it must vote on the proposal Sept. 6, one day before a deadline to apply for $75 million in federal money for the project.
The city doesn't have to work out all the details now, but it has to make a firm commitment to the Federal Transit Administration, said Michael Powell, chairman of Portland Streetcar Inc., the nonprofit board that operates the service.
"They have to come up with a believable story," Powell said.
The federal money comes from the Small Starts program, created by Congress with heavy lifting from Oregon's delegation.
Federal Transit Administrator Jim Simpson, in Portland earlier this summer, said the agency is following the streetcar project closely and is awaiting the application.
Other sources include $20 million in state lottery bonds to buy vehicles, $15 million from property owners along the route in the form of a local improvement district, $3.7 million from a separate pot of federal money controlled by regional officials, and $6 million from system development charges.
The City Council will hold a hearing today on the local improvement district, but officials don't expect significant objections from property owners.
The city contribution would come from three urban-renewal districts: $17 million from the River District, $4 million from Convention Center and $6.2 million from the Central Eastside.
Keith Witcosky of the Portland Development Commission explained that each of the these districts has money budgeted for the streetcar extension but at much smaller amounts than Adams is asking for.
That may require the city to raise debt limits, put off other projects, and take out short-term loans backed by the city's general fund.
These problems are most acute in the Central Eastside district, which has not seen the kind of growth in property values that has generated tax revenues in westside urban renewal districts.
Ken Rust, the city's top finance official, said that almost all the project costs would occur in the next five years, while most of the potential growth in the Central Eastside sparked by the streetcar and other investments won't emerge until well beyond five years. The plan for operating money also poses problems.
The streetcar will require a public subsidy of $2.2 million a year, to be split equally between the city and TriMet under Adams' plan.
But this assumes creation of a central city fare district with streetcar fares set at $1 and also assumes savings from service cuts on TriMet Line No. 6.
TriMet General Manager Fred Hansen said the subsidy plan will require public involvement and negotiations with the city.
Hansen was also surprised to see the transit agency down for a $1.1 million subsidy, noting that he had only discussed $1 million.
"I don't like surprises," he told the council.
Hansen also mentioned that TriMet board President George Passadore would like to see zoning changes to allow more residential development in the central east side, a suggestion opposed by Adams and businesses in the district.
James Mayer: 503-294-4109
http://www.oregonlive.com/news/oregonian/index.ssf?/base/news/118714833861600.xml&coll=7
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