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Hales peels back renewal plans, adding $1 billion to tax rolls

Redrawing urban renewal boundaries could help schools


by: TRIBUNE FILE PHOTO: CHRISTOPHER ONSTOTT - Portland Mayor Charlie Hales is considering changes to the urban renewal district that helped develop the South Waterfront area. The changes, which could affect Portland State University and the Pearl District, would put more property back on local tax rolls.Mayor Charlie Hales wants to overhaul Portland’s urban renewal districts, enabling more redevelopment near OMSI and the South Waterfront while freeing more property taxes for public schools, Multnomah County and the city.

Hales also wants to ditch the new urban renewal district around Portland State University championed by former Mayor Sam Adams.

Hales’ draft plan would eliminate two urban renewal districts, shrink two others so some property value goes back on the tax rolls, and expand two others where the mayor sees ripe development potential.

Hales says he wants to shut down the district near PSU and one in the Willamette River industrial area, neither of which ever got off the ground.

He also wants to peel off some of the booming Pearl District, part of the River District Urban Renewal Area, to put it back on the tax rolls, and do the same with a big chunk of the Airport Way district.

Hales says he would be making good on a campaign promise to reduce the city’s bloated urban renewal program. His proposals would put more than $1 billion in property value back on the tax rolls, producing property tax revenue for the county, state schools and the city’s own general fund.

His plan also would reduce the net acreage tied up in urban renewal areas by 1,700 acres, or about 13 percent.

In the past, Hales says, the City Council tended to use urban renewal districts as an “ATM” to fund pet projects. He says he wants to show the public that urban renewal is still a good tool, but needs to be used more prudently and strategically.

Redrawing the urban renewal districts is the first step in rethinking the city’s approach, Hales says. “There is a larger discussion that we’re launching about the future of the Portland Development Commission and its multiple missions.”

Though he promises changes at PDC, his proposed plan supports the agency’s historic role in using subsidies and other development tools in the central city area.

“I believe the traditional mission of PDC is still very valid and this is an affirmation of that belief,” Hales says.

Patrick Quinton, PDC executive director, adds: “I think it’s kind of updating the structure of our urban renewal areas to fit the opportunities that we see in front of us to pursue.”

Help for Old Town buildings

Hales wants to expand the Central Eastside Urban Renewal Area by about 130 acres, and extend its life by five years, so the city can spur redevelopment near the new MAX line to Milwaukie, especially the light rail stops at OMSI and Clinton Street. That could yield an additional $21 million to spend, including $3.6 million for subsidized housing.

Hales also sees ripe opportunities to assist redevelopment of the Zidell barge site on the waterfront, as well as the Knight Cancer Research Institute proposed on Oregon Health & Science University’s adjoining property. To do that, Hales wants to add about 35 acres to the North Macadam Urban Renewal Area that includes the South Waterfront, and give it five more years to raise money.

“What we don’t want to do is shut down that urban renewal area before we make the most of it,” Hales says.

by: TRIBUNE FILE PHOTO: JONATHAN HOUSE - Hales plans to alter Portlands urban renewal districts could provide money to help owners of Old Town buildings who want to renovate structures like this one to meet seismic codes.The expansion could yield about $60 million additional funding for PDC and about $24.5 million for low-income housing projects, says Kimberly Branam, PDC deputy director.

Hales had indicated months ago that the Pearl District doesn’t need much more city subsidies, and he suggested he might put the entire district back on the tax rolls. Property values in the district have grown from $461 million when it was created to $2.1 billion now, and PDC collects taxes based on the increased property value, making it a veritable golden goose for funding projects.

But Hales’ proposal would put only about 15 percent of the River District Urban Renewal Area property value back on the tax rolls.

Hales realized that he needed to keep the urban renewal area mostly intact to raise more money to improve Old Town and Chinatown. He’d like the PDC to focus on subsidizing Old Town’s historic properties in need of seismic upgrades that don’t now pencil out.

But first Hales must get buy-in for his plan from members of the PDC board and the rest of the City Council.


Back on tax rolls

• Added property taxes to Multnomah County from Hales’ proposal during the next 30 years: $31.6 million

• Added taxes for the county library district: $8.6 million

• Added property taxes for public schools: $32.8 million

• Added property taxes for the city’s own general fund: $33.3 million

• Total Portland land now in urban renewal districts: 13,226 acres

• Net reductions proposed by Hales: 1,700 acres

• State law bars cities from having more than 15% of their land base in urban renewal. Hales proposal would reduce the city’s share from 14.2% of the land to 12.5%.

Source: Portland Development Commission