A rendering the Hyatt Regency hotel proposed for the area north of the Oregon Convention Center.
With the Metro Council a day away from a scheduled vote on the financing plan for a $198 million hotel project, hotel advocates are starting to turn their attention beyond the Metro Regional Center.
The council has two votes scheduled for Thursday – a draft term sheet with the development team of the proposed Hyatt hotel, and an agreement between Metro, Multnomah County and Portland to modify the region's lodging taxing system to help pay for some of the hotel's bonds.
The amount of those bonds briefly caused a stir this week, as the Metro Council's resolution allows staff to issue up to $70 million in bonds for the project. Staff has said they'd issue up to $60 million in bonds, which would be paid back by the room taxes on visitors staying at the Hyatt.
In an e-mail to the Metro Council and staffers at Multnomah County and Portland, Andy Shaw, the chief of staff to Metro Council President Tom Hughes, said the public investment proposed for the hotel project has not increased, nor will it in the future.
In the e-mail, Shaw said the agreement bars the project partners from issuing bonds beyond what could be paid for by the room taxes on hotel visitors – projected at $60 million.
"The project term sheet for the OCC hotel, which the Metro Council will consider this week, continues to list the estimated revenue bond amount as $60 million," Shaw said. "The revenue bond amount will be finalized at the point at which a development agreement is reached."
After the Metro Council's Thursday vote, Hughes is slated to make the rounds with elected officials at the county and city ahead of their votes on the room tax agreement. Hughes met with Multnomah County Chair Jeff Cogen on Monday, and has meetings scheduled in the coming weeks with Portland commissioners Dan Saltzman, Amanda Fritz and Nick Fish, and county commissioners Judy Shiprack and Diane McKeel.
One of the concerns he's likely to hear at those meetings is a call for a rate floor, something some downtown hoteliers have asked for to avoid being undercut if the Hyatt struggles.
In an interview Tuesday, Hughes suggested the Hyatt would have a hard time cutting rates too low, regardless of a rate floor in code.
"This is going to be one of the few unionized hotels in town. Their operating expenses are going to be higher than most of the other hotels," Hughes said. "The idea that they're going to lead a downward thrust in hard times is a little like the car dealer who allegedly sold cars below cost but made up for it in volume."
Neither the Multnomah County Commission nor the Portland City Council have scheduled votes on the project.
Dana Haynes, a spokesman for Portland Mayor Charlie Hales, said the hotel is not yet on the Portland City Council's agenda.
"By September, it likely would be," Haynes said, adding that in about a month, "we should start seeing something that's manifested itself to such a degree that it can go to the city council."
Hughes said he expects that the Metro Council will have to vote on an amended agreement after the city council and county commission have considered the agreement. But, Hughes said, he didn't expect those amendments to be substantive.
"There are some tweaks they may make that will come back to us, but I think they're in the nature of tweaks," Hughes said. "Hopefully we will have talked out all of those issues before we vote Thursday."
David Austin, a spokesman for Cogen, said county commissioners will have to see a final finance package before they decide whether to offer support for the project.
"County staff have been meeting regularly with Metro as the agency tries to push forward on the hotel, and Tom Hughes and Andy Shaw have visited with Chair Cogen and the commissioners on a regular basis," Austin said.