If Mayor Keith Wilson wants to allocate clean energy fund dollars to renovate the Moda Center, he’ll have to go through Portland City Council first. And it’s not clear if they’re going to let him.
Earlier this year, amid a fervor to ensure Portland Trail Blazers’ new owner Tom Dundon keeps the basketball team in the city, Wilson joined the chorus of local government officials vowing to contribute public funds to upgrade the arena. Since then, alongside Governor Tina Kotek, Wilson’s commitment to the plan has only seemed to grow—despite backlash from constituents and other Portland leaders.
In total, the city of Portland—which owns the Moda Center—would be expected to invest more than $400 million in the renovation and subsequent upkeep. The mayor proposed that $75 million of that could come out of the Portland Clean Energy Community Benefits Fund (PCEF).
While some Portland City Council members have gotten on board with the plan to use city funding for the arena renovation, others have been hostile to the idea. The conversations so far have been opaque and difficult to parse, with city leaders expected to sign nondisclosure agreements in order to participate in the talks. For some, the suggestion of using PCEF dollars on the project is especially jarring.
PCEF was adopted by voters in 2018 as a 1 percent tax on purchases at big businesses in Portland to fund local carbon reduction and climate justice projects. The program has proven more financially lucrative than initially anticipated, raising about $200 million a year. As other city programs face budget shortfalls, PCEF has become one of Portland’s most alluring pots of money.
Climate advocates say the fund should remain focused on its initial, important mission, as the region grapples with the increasingly dire effects of the climate crisis.
Plus, the program’s funds are mostly spoken for, at least through the next few years. PCEF’s Climate Investment Plan lays out $1.6 billion in spending through 2029, most of which is already allocated to specific programs. While the program may have a larger-than-expected budget to work with, it’s not clear if PCEF could make major programming changes without rescinding funds from other projects.
At a May 7 City Council budget work session for Portland’s Community and Economic Development service area, Councilor Steve Novick called on Wilson to elaborate on his belief that PCEF can spare $75 million to help fund the Moda Center renovation. Novick said he thinks councilors deserve to know if the city administration finds unallocated PCEF dollars that could “reasonably be diverted to the Moda Center.”
“The City Council should know where that money might come from, so we can think about other ways to spend it,” Novick said. “Is it true that, at this point, you have absolutely no idea where, within PCEF, that $75 million might come from?”
In response, Wilson focused on connecting the potential Moda Center improvements to PCEF’s mission. He didn’t say if he’s been able to identify a source of the funding within PCEF.
“I work with my team to determine and contemplate areas in which we can find the financing for Moda. There are a significant amount of improvements we can do that are emissions-reduction focused,” Wilson said.
Wilson’s answer seemed to confirm Novick’s assumptions.
“All the money has been allocated. So the $75 million would have to come from somewhere,” Novick said. “I take your answers to mean we do not, in fact, have it yet.”
Novick’s frustration about the idea of using PCEF funds for the Moda Center reflects a broader sense of unease around the program’s funding decisions. In theory, the City Council is granted the power to weigh in on PCEF’s funding strategy through annual amendments to the Climate Investment Plan. But leveraging that power is a different story.
Earlier this year, the City Council was asked to approve a plan to reallocate $15 million that PCEF originally intended for an electric car financing program. PCEF leaders determined the money could be better used elsewhere, and the program’s advisory committee recommended it go toward building energy-efficient affordable housing. But city councilors wanted to have a say, and in January, the Council’s since-disolved Climate, Resilience, and Land Use Committee heard from various organizations vying for a piece of the $15 million.
But some local affordable housing providers, believing that City Council would simply accept the PCEF Committee’s recommendations, had already penciled the new funding into their budgets. Ultimately, the Council decided to stick with the committee’s decision, as not to pull the rug from under the organizations counting on receiving PCEF grants.
At the May 7 meeting, Novick requested city leaders share potential PCEF funding changes with the City Council while they still have a chance to meaningfully weigh in, instead of expecting councilors to rubber-stamp their decisions after the fact. Councilor Eric Zimmerman, who has generally been more supportive of spending public dollars on the Moda Center renovation, also raised concerns about City Council’s power of the purse when it comes to PCEF dollars.
“It often comes up that, for some reason, the City Council isn’t the budget authority for PCEF,” Zimmerman said. “I don’t know why it continues to be this lagging concern that if a group of community members say so, then it just shall be.”
Donnie Oliveira, deputy city administrator for the Community and Economic Development service area, highlighted the community-led nature of PCEF, and indicated the committee members may be defensive due to the “scrutiny and armchair quarterbacking” the program is exposed to.
“I’ve never seen a program nitpicked the way this one has been,” Oliveira said, and emphasized that the City Council does have agency to make changes to the program.
“The truth is, we have a very complex program with a lot of initiatives that take a lot of staff time…to deliver on,” Oliveira said. “And I think it would [benefit] everybody…for us to be disciplined enough to allow the teams and the bureaus to deliver on the strategic plans we’ve committed to.”
The PCEF Committee has kept quiet about the potential Moda Center deal. In an OPB interview last month, Novick said he’s puzzled by the committee’s apparent decision to stay out of the conversation. PCEF Committee members have also declined requests for comment and interviews on the topic. It’s unclear if and how involved the body will be in decision-making as the plans continue to develop.
As it is, there’s a lot that’s up in the air.
At the May 7 meeting, Oliveira said staff “have not dove into anything that even looks like final blueprints or plans for engineering” to decide if the renovation project could be eligible for PCEF funding. He indicated staff plan to begin that work over the summer.
Wilson, meanwhile, said he believes the Moda Center renovations could “have a nexus” to PCEF.
“But, in the end, these 12 councilors will determine whether that nexus is appropriate or not.”
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