Supporters of the proposed Hyatt hotel near the Oregon Convention Center got a big boost Thursday when the Portland Business Alliance announced its conditional support for the $200 million tourism project.
But the PBA, as well as downtown hoteliers skeptical of the project, all said they want to know more information about the project's tentative funding agreement.
The Hyatt, which would be built immediately north of the convention center, would keep 500 rooms available for large conventions. As part of the plan, Hyatt would receive about $14 million in direct public subsidies, $4 million in Portland Development Commission loans and $60 million in construction bonds, to be paid back through room taxes on Hyatt visitors.
Because room taxes are collected for a visitor fund jointly run by Portland, Multnomah County and Metro, all three governments have to agree on the hotel's finance plan. The Metro Council is first up, holding a public hearing on Thursday and a vote next week.
Raihana Ansary, a government relations manager for the PBA, said her organization will endorse the project if it produces a valid business plan that demonstrates it can meet its debt obligations, that the Visitor Development Fund – the joint account funded by regional room tax dollars – would only take a hit to pay down hotel debt in severe recessions, and that Metro, the city and county agree to never levy taxes or fees on other hotels to pay for the Hyatt project.
"An OCC hotel that meets the above conditions is a smart investment, and we urge you to move forward with this important regional project," Ansary said.
Teri Dresler, the director of Metro's visitor venues, said the PBA's questions were reasonable.
"We're very pleased with it," she said of the PBA's conditional support. "Just like elected officials, an agency that has business owners as its members has to be responsible to those constituents. "
But Paige Richardson, an organizer of the Coalition for Fair Budget Priorities and a skeptic of the current hotel proposal, called for more public review of the proposed plan. She wanted to know how much the hotel's bonds would cost after interest is incurred and whether Hyatt would have to own the property for the life of the bonds, among other questions.
"We urge you to allow public access to the specific terms of this project and to do more to protect the public and less to please the developers and the Hyatt Corporation," Richardson said.
Dresler said she hopes to have answers to all of the questions about the project raised at Thursday's public hearing – including those from the PBA and Richardson – by the end of the day Friday.
Most of the testimony Thursday was in favor of the project, with about three-quarters of the 22 speakers supporting the proposal.
"In the long run, this will benefit everybody in the industry – the lodging industry, the tourism industry and the economy as a whole," said Harold Pollin, a Portland hotel owner.
His thoughts were echoed by Paul Raynor, a 15-year hospitality industry veteran who said he's spent the last seven years working in room service at the Benson Hotel.
"I have absolutely no fears of the Hyatt opening up across the river. I think it'll be great for the downtown hotels," Raynor said. "I'm looking forward to the overflow. Six hundred rooms is nothing. They'll come across the river into my pocket, and I'll be very, very happy."
After about an hour of public testimony, Metro councilors generally seemed supportive of the funding proposal, but wanted more details.
Councilor Carlotta Collette asked if the financing projections looked at scenarios worse than those modeled after the downturn in the economy after the Sept. 11 attacks and the Great Recession.
"Are those the measuring points, or have you thought about what else could happen that could be a (even worse) case scenario?"
Ken Rust, Metro's financing consultant for the project, said the Great Recession and Sept. 11 represented significant downturns in the models.
"Obviously, it could be worse because we can't imagine how bad things can be," Rust said. "If you're worried about a pro forma that can't sustain the worst-case event we've prepared, I don't know what project is going to go forward if the threshold is worse than what we've had."
The fact that the project has some risk didn't discourage Councilor Craig Dirksen, who said he's close to supporting the funding package.
"There's no such thing as no risk," he said. "Can we get a program that has an acceptable risk? I believe that's attainable, and I'm willing to support this if we achieve that."
Council President Tom Hughes echoed Dirksen's statement.
"If we look for a project that's been scrubbed of all the risk, we will never do anything," he said. "I can't think of a time I've supported a 'Let's not do anything' approach."
The Metro Council is scheduled to vote on the finance plan on Aug. 15. It's unclear when the Multnomah County Commission and Portland City Council would hold their votes on the financing plan. County Commissioner Loretta Smith attended Thursday's public hearing.
Note: The name of PBA representative Raihana Ansary was mispelled in an earlier version of this story. This version has been corrected.