Local Governments Sign On To Bond-Backed Portland Hotel

OPB | Sept. 19, 2013 5:04 p.m. | Updated: Sept. 20, 2013 8:24 a.m. | Portland

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Three Portland-area governments have voted a total of five times recently in favor of a new hotel next to the Oregon Convention Center. Portland City Council’s last vote comes next week. Multnomah County got its two hotel votes out of the way Thursday.

An artist's rendering of the proposed Hyatt at the Oregon Convention Center.

An artist's rendering of the proposed Hyatt at the Oregon Convention Center.

Courtesy Metro

Unions and business groups have come out in favor of the $200 million Hyatt Hotel. They see it as a shot in the arm for the construction industry and as a much-needed boost for the under-used convention center.

Supporters have far outnumbered critics at public hearings this week in front of Portland City Council and the Multnomah County commission.

New county chair Marissa Madrigal says she voted in support of the hotel because it could bring jobs to needy county clients.

“To be able to secure a secure, well-paid job with benefits that could propel them forward for a long time, to me is what pushes me over onto the side of supporting this project,” Madrigal says.

Critics have questioned the structure of the hotel deal. They say the $80 million in public subsidy, including a $60 million bond, is too much.

Lodging taxes paid by patrons of the new Hyatt Hotel would go to pay off the bond. But if the hotel underperforms and the taxes fall short, the payments would come from other lodging tax sources.

Some of the city’s other hotel operators object to that. And they lament that specifics of the deal have been kept private, as Metro continues to negotiate with Hyatt.

While commissioners, like Deborah Kafoury at Multnomah County, have expressed doubts, they’ve generally voted in favor.

“When private developers stand to make a lot of money on a project with public funds, I believe that they should carry some of the risks if the revenue doesn’t meet expectations,” Kafoury said. “In addition, I hope that Metro will continue to work closely with the developer to reduce the construction cost of the hotel, and that those savings would come out of the public’s part of the investment of the project.”

Multnomah County, Portland and Metro have now approved the overarching framework of the deal.

The county and Metro have also signed off on changes to the lodging tax. The city will take that up next week.

Once Metro and Hyatt have a final deal, Metro Council will have one more vote.

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