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http://portlandtribune.com/news/story.php?story_id=127975191271371400

What should come first: Defining precisely which downtrodden areas of Portland are in need of transformation, or having development ideas already in hand before drawing new urban renewal boundaries?

Mayor Sam Adams has decided to take the latter approach, and his new direction for urban renewal districts is raising eyebrows among some who closely follow the city's policies.

Adams wants the City Council to see a detailed list of potential redevelopment projects before creating new urban renewal areas or expanding existing ones.

"In the past, the council didn't always know what to expect or how to measure an area's success," Adams says.

This new approach was on display last week at two urban renewal-related events. The Portland Development Commission is considering expanding the Interstate Corridor urban renewal district to include the Rose Quarter. At a July 12 public forum on the future of the area, Adams announced that the PDC was already talking to the Portland Trail Blazers about redeveloping the area - even though a Rose Quarter Stakeholders Advisory Committee appointed and chaired by Adams was just starting to take up the issue.

The news surprised some of those at the forum, including Portland Monthly Editor Randy Gragg, who moderated the session. He accused Adams of changing the process for deciding the future of the Rose Quarter - a charge that Adams denied.

The next day, the PDC presented preliminary plans for a new Central City urban renewal area to another advisory committee appointed and chaired by Adams. As proposed to the committee, it would encompass 325 acres and include portions of downtown, Old Town and Northwest Portland. Potential development partners mentioned by the staff included Portland State University, Multnomah County, Portland Public Schools and the Con-way trucking company.

The presentation was so detailed, in fact, that newly elected Multnomah County Chair Jeff Cogen asked if the committee had already approved the new urban renewal area. Cogen, who recently replaced former Chair Ted Wheeler on the committee, wondered if he missed the debate on whether the city even needs a new renewal district at this time.

"Has the group already decided the big question of, do we need a new (urban renewal area)?" Cogen asked.

Adams assured Cogen that no such decision has yet been made.

"It's important that we specify the costs and benefits first, then we'll have the big picture discussion," said Adams, who expects the council to consider both plans by the end of the year.

More upfront planning

It's not surprising that Gragg, Cogen and others are confused by Adams' new approach to creating new urban renewal areas  and expanding existing ones. In the past, the city has taken the opposite approach to the issue - first deciding what part of town needs redevelopment help and then seeing who proposes a project. Adams believes that lining up the projects first makes more sense.

"This is the first time we've had such an overt investment strategy," Adams says of the detail included in the preliminary discussion of a westside urban renewal area.

The council has, however, almost always had at least one large publicly financed project in mind when creating a new urban renewal area or expanded an existing one. The Civic Auditorium was planned before the first urban renewal district - South Waterfront - was created in 1958. The council knew the Oregon Health & Science University would invest money in the North Macadam urban renewal area when it was created in 1999. And the council created the Interstate Corridor renewal area in 2000 largely to help finance the Interstate MAX light-rail line.

But Adams is right when he says the council does not always know which privately financed projects are likely to result from such public investments, or how they will turn out. For example, urban planners are now disappointed about the lack of public spaces around the tall residential towers that sprang up in the South Auditorium urban renewal area. Financial problems have stalled new construction projects in the North Macadam renewal area (also called South Waterfront). And it was not until 2008 that the council changed the zoning along the Interstate MAX line to allow the kind of high-density mixed-use projects it had envisioned there.

In comparison, much more information is now being presented about the Rose Quarter and Central City urban renewal areas.  Appearing with Adams at Monday night's event, the Trail Blazers presented their complete Rose Quarter development team, including the Cordish development company, Nike, architect Rick Potestio and the Design Collective. And when the PDC advisory committee met the next day, it was presented with a detailed block-by-block map of the proposed Central City renewal area.

Committee members also reviewed a 25-year budget projection that broke down how $252 million in property taxes would be spent in five-year increments. Specific projects discussed by the group included building family-oriented student housing near Portland State University and remodeling or replacing the Metropolitan Learning Center.

After the meeting broke up, Cogen said he assumed an advisory committee appointed by Adams would do what Adams wanted in the end. But he also said at least some of the projects sounded like deals being cut to win the support of individual members.

"It sounded like we were discussing a done deal." Cogen said.



How urban renewal works in Portland


The basic idea behind urban renewal financing is simple. The council draws a line (the urban renewal boundary) around an area in need of help. Once the renewal area is formally created, property tax collections within it are divided into two parts: taxes applied to the assessed value of the district at the time it was created, and taxes applied to the increase in value after the district was created.

Taxes collected on the frozen tax base continue to be distributed to all taxing jurisdictions, including the city, county and school districts. But taxes collected on the increased value are only collected by the city for reinvestment in the area. This is called tax increment financing.

Urban renewal areas are intended to last for a specific amount of time, usually 20 years. When they expire, all taxes collected from an area are then supposed to be available for general government purposes.

But in recent years, the council has voted to extend the life and increase the maximum indebtedness of several areas. These extensions helped fuel criticism from Multnomah County Chair Jeff Cogen, who worried that the county might never see the tax benefits of the city-supported redevelopment projects. The county was unable to collect about $22 million in property taxes last year from within the city's urban renewal areas.