The deal to bring Major League Soccer to Portland is back off life support for the time being, after the city took controversial urban renewal money off the table this afternoon as a means of plugging the $15million hole in the cost of renovations to PGE Park for Major League Soccer.
Timbers owner Merritt Paulson will plug the gap, with an $8million cash contribution, and a prepayment of $11.1million in rent and ticket taxes. Meanwhile the city will borrow $11.2million from its special "spectator fund," which is funded by a tax on ticket sales. If the cost of the construction overruns, the city will absorb up to $1million in costs, but Paulson will pay for all overruns beyond the initial $1million. The city will also pay a $700,000 "soft cost" by waiving certain development fees for the arena.
Removing urban renewal money—which is supposed to be used to regenerate "blighted areas"—means a major barrier to public support of the $31million renovation cost is removed. Who knows: This reporter may even be inclined to be supportive, from now on.
Almost all the money for the deal comes from a private investor and spectator revenue. There appears to be very little risk to the city. Everyone on council seemed very agreeable to the new deal this afternoon, and of course, a bunch of Timbers fans showed up with their scarves.
City Commissioner Amanda Fritz said, "Clearly this is a much better deal for taxpayers." Both she and Commissioner Nick Fish say they need two weeks to look at the details of the plan before expressing support.
The city waived its usual competitive bidding process to go forward with the deal, but Commissioner Randy Leonard said that was okay because "we have a private sector partner with a lot of skin in the game."
Nick Fish asked Paulson about potentially bringing in a Major League women's team (Fish's daughter is a keen soccer player). "It's on my radar," Paulson said.
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