keoadmin
01-07-2004, 01:19 AM
NewsBuzz - Tax Secrets
Willamette Week, Portland Oregon July 7, 1999
When the city council votes Wednesday on whether to spend $33 million renovating Civic Stadium, they'll do so without having publicly disclosed a big piece of information--where the money is coming from.
Last week, Mayor Vera Katz and her staff unveiled plans to give Marshall Glickman's Portland Family Entertainment group a 20-year deal to run the stadium but she and her staff have repeatedly refused all media requests to discuss funding details.
Part of the reason for Katz's reticence may be that not everyone is thrilled about the plan.
According to confidential city documents obtained by WW, Katz wants the funding for Civic to come from an increase--from 9 percent to 11.5 percent--in the Multnomah County hotel and rental car taxes.
The impact of the proposed tax increase has some local hoteliers grumbling.
"I'm irritated," says Sam Allen, owner of the Monarch Hotel and the Inn at the Meadows. "My great fear is this is going end up costing us business," he says
The tax increase itself is not all that's bothering some innkeepers. They're also unhappy with how some of the proceeds will be spent.
The biggest chunk of the new revenues will fund an expansion of the Convention Center, which they desperately want. It will also fund the Portland Center for the Performing Arts, Tri-Met's fareless square--and Civic Stadium, which is where their complaints lie.
The hoteliers say they originally approached Katz with the idea of raising money for the Convention Center after last November's ballot measure failed. Although the Multnomah County Commission must approve the final version of any hotel tax increase, the city's higher credit rating and stake in the Convention Center made it a natural partner. In the course of discussions, the two sides arrived at the idea of floating bonds backed by a 2.5 percent increase in the hotel tax. Later, it became clear that such an increase could raise as much as half a billion dollars over 25 years--far more than the convention center required.
In early June, according to Phil Peach, Executive Director of the Oregon Lodging Association, Katz suggested some of the money should go to Civic. "I guess the city saw an opportunity--that might be the understatement of the year," Peach says.
According to projections prepared by Katz's staff, the stadium could receive as much as $102 million of the new tax revenue. That's well above the $60 million officials say will be required to pay debt service on the renovation of the 73-year-old ballpark. It's unclear where the extra money will go--and again, city officials aren't talking.
To some hoteliers, what amounts to a subsidy for Civic and Portland Family Entertainment is hard to swallow.
"We're giving all this money to Marshall Glickman, the friend of the people?" says Stephen Gentner, whose family owns the Imperial and Mallory hotels. "I think we should call it Rip City Stadium."
Even if PFE brings Triple A baseball and professional soccer to Portland as promised, the lodging industry doesn't think it'll get much of a payback. Gentner says the Mallory, located right next to the stadium and owned by his family since 1943, has never gotten much business from the succession of minor-league teams that have played at Civic.
Negotiations over the final version of the tax increase continue, but with nervous hoteliers facing a glut of new downtown rooms, Katz's projects may have priority over the hoteliers' objections. "Hotel taxes used to be a way of promoting industry," Peach says. "Now they're a way of backfilling budget shortfalls."
--Nigel Jaquiss
Willamette Week, Portland Oregon July 7, 1999
When the city council votes Wednesday on whether to spend $33 million renovating Civic Stadium, they'll do so without having publicly disclosed a big piece of information--where the money is coming from.
Last week, Mayor Vera Katz and her staff unveiled plans to give Marshall Glickman's Portland Family Entertainment group a 20-year deal to run the stadium but she and her staff have repeatedly refused all media requests to discuss funding details.
Part of the reason for Katz's reticence may be that not everyone is thrilled about the plan.
According to confidential city documents obtained by WW, Katz wants the funding for Civic to come from an increase--from 9 percent to 11.5 percent--in the Multnomah County hotel and rental car taxes.
The impact of the proposed tax increase has some local hoteliers grumbling.
"I'm irritated," says Sam Allen, owner of the Monarch Hotel and the Inn at the Meadows. "My great fear is this is going end up costing us business," he says
The tax increase itself is not all that's bothering some innkeepers. They're also unhappy with how some of the proceeds will be spent.
The biggest chunk of the new revenues will fund an expansion of the Convention Center, which they desperately want. It will also fund the Portland Center for the Performing Arts, Tri-Met's fareless square--and Civic Stadium, which is where their complaints lie.
The hoteliers say they originally approached Katz with the idea of raising money for the Convention Center after last November's ballot measure failed. Although the Multnomah County Commission must approve the final version of any hotel tax increase, the city's higher credit rating and stake in the Convention Center made it a natural partner. In the course of discussions, the two sides arrived at the idea of floating bonds backed by a 2.5 percent increase in the hotel tax. Later, it became clear that such an increase could raise as much as half a billion dollars over 25 years--far more than the convention center required.
In early June, according to Phil Peach, Executive Director of the Oregon Lodging Association, Katz suggested some of the money should go to Civic. "I guess the city saw an opportunity--that might be the understatement of the year," Peach says.
According to projections prepared by Katz's staff, the stadium could receive as much as $102 million of the new tax revenue. That's well above the $60 million officials say will be required to pay debt service on the renovation of the 73-year-old ballpark. It's unclear where the extra money will go--and again, city officials aren't talking.
To some hoteliers, what amounts to a subsidy for Civic and Portland Family Entertainment is hard to swallow.
"We're giving all this money to Marshall Glickman, the friend of the people?" says Stephen Gentner, whose family owns the Imperial and Mallory hotels. "I think we should call it Rip City Stadium."
Even if PFE brings Triple A baseball and professional soccer to Portland as promised, the lodging industry doesn't think it'll get much of a payback. Gentner says the Mallory, located right next to the stadium and owned by his family since 1943, has never gotten much business from the succession of minor-league teams that have played at Civic.
Negotiations over the final version of the tax increase continue, but with nervous hoteliers facing a glut of new downtown rooms, Katz's projects may have priority over the hoteliers' objections. "Hotel taxes used to be a way of promoting industry," Peach says. "Now they're a way of backfilling budget shortfalls."
--Nigel Jaquiss