Portland Beavers owner Merritt Paulson agreed to all the financial demands laid down for the financing of a new ballpark and a PGE Park renovation — but there still may not be enough support on the City Council to finalize the deal.
Portland Beavers (Class AAA; Pacific Coast League) owner Merritt Paulson agreed to all the financial demands laid down for the financing of a new ballpark and a PGE Park renovation — but there still may not be enough support on the City Council to finalize the deal.
Paulson is proposing spending $88.8 million on the renovation of PGE Park as a soccer-only facility (at a cost of $33.7 million) and the construction of a new ballpark for the Bevos in the city’s Rose Quarter (at a cost of $55.1 million), dropping plans to locate the new facility in the Lents area of Portland.
The master plan now calls for a new Rose Quarter ballpark on land partially occupied by Memorial Coliseum, which would be torn down. The Portland Trail Blazers have been working on an entertainment district in the area, and while a new ballpark hasn’t been part of the Blazers’ plans, it certainly would add traffic to the venture.
A task force appointed by City Councilperson Randy Leonard laid out a financing plan that called for $30 million from the city, $30 million from city redevelopment funds and $5 million from taxes on pro-soccer player salaries, leaving Paulson to make up the remainder. The task force also recommended some stringent requirements that the funds be paid back no matter what, personally guaranteed by Paulson and his family.
Paulson initially balked at the requests, but negotiations with Leonard and Mayor Sam Adams led him to agree with all the requirements; he and his minority investor, former Treasury Secretary and Goldman Sachs head Henry Paulson will guarantee the $60 million in loans. In addition, Paulson will contribute an additional $12.5 million toward construction and to find another $11.8 million, which could include the player taxes if a proposal passes the State Legislature. Paulson also agree to a 7 percent ticket surcharge used to repay the city and will cover all cost overruns past the first $2.5 million.
The agreement calls for $31 million to come from the city’s so-called Spectator Fund, which receives revenues from ticket surcharges at the city’s three sporting venues, hotel taxes, parking and rental-car fees. A new part of the equation calls for a new tax-increment financing district in the west side of downtown Portland. Another new source of financing, $18.5 million, comes from revenues raised by the Oregon Convention Center urban renewal area, which has a $26 million surplus.
Despite Paulson’s concessions — and they are major, but we suspect some of the willingness to capitulate lies in the belief that an MLS expansion franchise won’t cost $40 million, as MLS originally wanted — there may not be enough support on the City Council to pass the measure. There are only two sure yes votes, and the use of city redevelopment money for the projects may end up leading councilmembers on the fence to oppose the measure. Still, Paulson’s willingness to step up and personally guarantee repayment of the funds will surely win him some goodwill on the council — but we’ll see if it’s enough.
RELATED STORIES: Bevos ballpark plan runs into serious financial obstacles; Portland task force gives preliminary approval to new Bevos ballpark — with plenty of conditions; Portland ballpark discussion shifts to Rose Quarter; Decision on new Bevos ballpark location delayed; Will new ballpark fly in Lents?
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