What has Lake Oswego learned from the West End Building?
The worst thing that happens to you may be the best thing for you if you dont let it get the best of you.
Last year, I asked, Has Lake Oswego exorcised its WEB demons? Over the past few months, its become pretty clear our WEB demons are going to be with us for a while.
After a $16.5 million offer from the Kensington Investment Group fell through in April, we were left with the same old demon on our back. There is no doubt that we have lost enormous wealth in the purchase decision supported by both the Hammerstad and Hoffman administrations.
Its a decision that has cost our city enormously in terms of our quality of life and our infrastructure investment, and is a stunning example of the tax and spend political philosophy. The previous council clearly overpaid for the West End Building, using our $20 million in taxpayer funds. They then claimed that a down real estate market was the reason for the WEBs poor performance. We now know (in a good market) that this excuse is simply just not true.
The WEB has cost us more than $10 million in lost taxpayer wealth (operating costs), and thats just the beginning. The recent offer of $20 million by local developer Nick Bunick may be a godsend to our community. If Bunick closes on the property in October, I and many community leaders wish him well. Why? He may have saved LO taxpayers from writing a check in excess of $3.5 million to any other buyer. With the Kensington deal falling through, we can see the real costs of the WEB. That deal represented a $3.5 million capital loss in addition to the operating costs.
Many realized that under the terms of the now-aborted deal, the WEB not only cost us millions in lost taxpayer wealth but also quality of life. Those with a detailed knowledge of the budget now lament that lost wealth. Why? These millions of dollars arent going toward reduced water rates, a new maintenance facility, a new South Shore fire station or street improvements. They also drain our general fund reserves. That $3.5 million capital loss represented nearly all our available general fund reserves, while the $1 million annual payment is a substantial drain on our available general fund monies.
What were these people thinking? The answer is that they werent thinking, and they provided a valuable lesson in how far ideological officials will go if not carefully held accountable. Its a very costly lesson for all of us in terms of lost wealth and a lower quality of life. Our opportunity costs what we cant currently improve in LO because of the WEB should be disturbing. LO can no longer afford to make these mistakes and retain our community character.
The good news is that we now have a council that is actively trying to correct the mistake and a potential buyer thats willing to pay more. Lets see if these elected officials can close a sale. If they do, it may help us move forward and address the real concerns of the community. I am doing all I can to assist our community in moving forward after this valuable lesson. Lets not make the same mistake again, but use our funds wisely.
Thank you for all your comments and your support.
Dave Berg is a 23-year resident of Lake Oswego and a board member of COLA LO.
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