Salem police facility could waste $20 million of downtown urban renewal funds

So, fellow citizens of Salem, do you agree with me about this?

Making downtown more attractive, people-friendly, and economically vibrant is a way better use for $20 million in urban renewal funds than using that money to subsidize a supersized, overly expensive new police facility.

Most people in this town would emphatically answer "Yes!" 

Unfortunately, today the City's Urban Development Director, Kristin Retherford, said at a Salem City Watch meeting that $10 million to $20 million of urban renewal funds might be used to finance construction of a vastly over-priced $80 million police facility on the old O'Brien Auto Group site just north of downtown. 

On the positive side (the rest of what I'm going to say will be negative), kudos to Retherford for being open and transparent about this plan. Too often in the past City officials have sprung bad ideas on citizens late in the policy-making game, knowing there will be opposition to them.

Now, let's look at why this proposal to spend up to $20 million in urban renewal money on a new police facility deserves to die a quick death.

(1) City officials have said only about $1 million in urban renewal money would be used. 
Here's part of a March 1 City of Salem press release issued after the City Council chose the O'Brien site as the location for a new police facility.

The total development cost at the O'Brien site is estimated at $81.4 million, with a property tax impact of $9.08 per month for the same valued home. Leveraging urban renewal resources for required traffic circulation improvements in the area could reduce the cost by over a million dollars, resulting in a savings of about 12 cents per month to an average home owner.

The exact figure cited by City Manager Steve Powers is $1,086,000 in urban renewal funds. See:
Download Police Facility Planning Progress Report

This is the information that was presented to the public, Mayor, and city councilors prior to the City Council meeting where vigorous opposition to the block south of the Library led to the O'Brien site being chosen as the preferred location for a new police facility. 

Yet now we're being told that up to $20 million in urban renewal funds may be used to pay for its construction.

Ideally, no urban renewal money at all should go for this purpose. But $1 million for street improvements in the vicinity of the police facility perhaps could be justified; $20 million, mostly for construction, can't be. Because...

(2) A police facility doesn't fit into the City's own Downtown Urban Renewal Plan. That plan, which was last updated in 2014, includes no mention of an objective anywhere akin to building a 148,000 square foot, $80 million police facility on the O'Brien site. Take a look on pages 3-4. 
Download Downtown Urban Renewal Plan

By contrast, the Urban Renewal Plan does talk about objectives that would truly make the downtown area more vibrant and, to not-coin-a-term, renewed. For example:

To beautify and enhance the streetscape by participating in projects involving public art, landscaping, sidewalk surfacing, signing, street furniture, intersection corner bulbs, weather protection, and related improvements.

Recognize Mill Creek as a community asset by providing open space and good pedestrian access to and along the Creek, by acquisition of property and construction of pedestrian/bicycle ways along the Creek and potentially grade separated paths at major barriers such as streets.

To participate in the development of the Willamette Riverfront in a way that provides an opportunity for a mixture of commercial, residential, public, and other uses compatible with the Riverfront, and facilitates safe pedestrian and bicycle movement along the Riverfront with linkages to adjoining areas.

This is how Salem Community Vision put it in their position paper, "Salem's New Police Facility: The Best Way to Achieve It." 

Our concern is that the City of Salem may use urban renewal funds to reduce the cost of a police facility bond that will be presented to voters in November 2016. This would take money away from more worthy projects aimed at vitalizing the downtown area. After all, few people say, “What I really want to visit in Salem is the police facility.”

So whatever the cost of building a new police facility is, along with seismic retrofitting of the Civic Center, citizens should be asked to pay that amount directly through a bond that increases their property taxes. This is honest. Paying for much of the cost through urban renewal funds disguises the amount of public money going into these projects, and prevents limited downtown urban renewal funds from being used in better ways.

(3) There are indeed many better ways to use downtown urban renewal money. Urban renewal funds are property taxes from a defined area that are intended to vitalize the area. A good description of how urban renewal works is in this 2014 Oregonian story.

Urban renewal is a way for a city to finance improvement projects or bolster private investments within an area considered “blighted.” That includes developing vacant properties and providing adequate utilities or street improvements. The program aims to increase property values, and thus generate higher tax revenues, to offset the costs of the city's investment.

Well, until 2015 the O'Brien location was occupied by three auto dealerships. A Statesman Journal story written at the time the dealerships moved said: 

“With Lithia Motors's recent relocation to a new facility on Salem Parkway, a space that's ripe with opportunity has opened in downtown."

Thus it is difficult to view this property as blighted.

Further, a police facility will not pay any property taxes (unless the land is kept in private hands and leased to the City of Salem, which is unlikely). As noted above, the City's own Downtown Urban Renewal plan has many objectives, none of which call for using up to $20 million in urban renewal money to build a tax-exempt government building.

A few days ago I blogged about a Salem 2025 report that looked at the future of downtown. There are a lot of good ideas in the report, along with a few bad ones.

Today Urban Development Director Retherford told people at the Salem City Watch meeting that local businessman Larry Tokarski, president of Mountain West Development Corporation, had commissioned the Salem 2025 study -- a fact that wasn't mentioned in the report.

Here's some excerpts from the Salem 2025 report pertaining to the use of downtown urban renewal funds.

Approximately $30M in urban renewal bonding authority will be available in the next three years (as the bond for the Convention Center is paid down). This is a tremendous asset that, if leveraged and steered properly, will be a game changer in the emergence of downtown Salem as a successful urban place.

...Based on this assessment of assets and challenges, we believe that the stars are aligned for Salem to make an ambitious move to make its downtown a major success story. Key pieces are in place (see the “assets” above”), and most if not all of the challenges can be overcome with sufficient political will. Salem has the resources – or will have, in the near future – to use urban renewal funds in a strategic way, to leverage major private investment.

...The last section of the report proposes a process to determine what the strategy ought to contain, who needs to be at the table, and how the decisions are made. In anticipation of such an effort, we surmise that there will be strong support for the following investments which will have the capacity to re-energize downtown Salem:

• Promotion of high density mixed use development – this means dollars for public/private deals, for land acquisition of strategic properties, and for predevelopment work

• Rehabilitation of Salem’s fine stock of historic buildings, including development of housing or high tech office uses on upper floors

• Access to waterfront

• Streets to serve all modes, not solely the auto. Fewer lanes, attractive lighting and pedestrian furnishings, curb extensions, bike lanes, and ample sidewalks.

• Tools to incentivize the sorts of places that energize a district – brewpubs, wine bars, etc.

Hard to see -- no, impossible to see -- how spending $20 million of downtown urban renewal money on a new police facility furthers these strategic goals.

An $80 million police facility on the O'Brien site isn't going to leverage major private investment. It isn't going to energize downtown. It isn't part of the City's Downtown Urban Renewal Plan. It isn't part of the Salem 2025 vision for downtown that calls for a bold, creative, collaborative vision of what Salem's urban core can become.

So why is spending $20 million of urban renewal funds on a new police facility being considered by City officials? Us citizens await the answer.

My suspicion is that the folks at City Hall are so attached to their over-priced, supersized $80 million plan for a 150,000 square foot police facility, while recognizing that it will look really bad if seismic upgrades aren't made to the Library and City Hall as part of a Public Safety bond to be voted on in November 2016 as was previously planned, they want to use the $20 million as a way to do this.

Meaning, this would allow the $80 million bond request to include $20 million for the seismic upgrades, along with $60 million for the police facility. The remaining $20 million to build the police facility would come from urban renewal funds that can be tapped by the Urban Renewal Agency Board.

Which, conveniently, consists of the Mayor and City Council.  

In this depressing scenario, vitalizing downtown would be sacrificed for a wasteful Police Palace. Downtown property taxes would be used for a government building that will do nothing to stimulate private investment in the area, a core goal of urban renewal. 

Hopefully this bad idea soon will die a well-deserved death. 

Comments

[JT]

Police palace! Lol...

[Alex Kohan]

Oof, it is unfortunate that Larry Tokarski commissioned the Salem 2025 study. It puts even more doubt into the objectivity of the report. Since 2007 Larry Tokarski, his family, and Mountain West have contributed around ~$300,000 to area candidates, the vast majority of whom were Republican. Of course he can afford to do that when his projects get tax abatements, like the Boise Cascade site, and he is able to make huge profits on his developments.

As to the point of the blog post. This seems to be a complete mismanagement of Urban Renewal Funds. The City needs to stop neglecting downtown businesses and infrastructure in favor of their own hubristic plans. Between this and the Kubler Station South concept it is becoming painfully obvious that the city council has little regard for downtown and worse are willfully destroying it.

[Brian Hines]

Alex, I agree that Mountain West has gotten some sweetheart deals from the City. Still, Larry Tokarski didn't write the Salem 2025 report. Consultants did, apparently. It has many good ideas, so the fact that Tokarski commissioned the report doesn't take away from this. Who knows? He may not even agree with some, or much, of the content of the report.

(It is curious that more than two months after Salem 2025 was completed, the report hasn't been released in any sort of official manner.)

Regardless, I felt that here is one of those times when Right and Left, Conservatives and Liberals, seem to agree on something: downtown needs to be vitalized through public/private partnerships. Leveraging urban renewal funds to promote downtown economic development can, and should, go hand in hand with making the Historic District a more people-friendly place.

[Alex Kohan]

I'm sorry but I am having trouble taking the study seriously based on it's contents. Lets start with the list of interviewees, without exception they are all either business people or from the City of Salem. If we are going to build a better downtown then that effort has to include all of Salem's partners, not just a small subset.

That leads me to another point. There is a lot of decrying the fact that Salem hasn't done well in the past, however the people who were interviewed are the ones who have been in charge of Salem for the past 10 years. I mean they talk about millennials in the report, but then they didn't even bother to interview any. And that is the problem, until the City starts listening to new and diverse voices, we are going to continue in the same rut that we have been in the last 10 years.

In the end this report's suggestion sounds very similar to SEDCOR, an organization whose mission statement is good, but which has questionable leadership and whose work seems to benefit a very small section of Salem.

And that is what I am afraid of. This report does have a lot of good ideas in it, but any progress in Salem's downtown needs to come from all of Salem's citizens. Too often in Salem we look at the private/public partnership as businesses/city government, but we need to include non-profits, private citizens, transit, etc. We need true creatives, not just a single mindset. And I don't see this report being used to fix anything in the future.

[John Gear]

The report reveals perfectly the mindset of the ruling cabal, with its mutterings about "naysayers" and talking about how these "naysayers" have to be managed. People who think for themselves and don't take orders from the Chamber are the ones that they're talking about.