Portland’s cash-strapped leaders are looking to divert dollars from the city’s lucrative voter-approved climate tax to prop up a public financing deal deemed essential to keep the Trail Blazers from leaving town.
Mayor Keith Wilson and other officials could seek to pull as much as $75 million from existing city projects approved with money from the Portland Clean Energy Community Benefits Fund to help bankroll a renovation of the Moda Center, according to two sources with direct knowledge of the negotiations.
The substantial sum would cover only a portion of what might need to be a $185 million commitment from the city, based on current discussions between government officials and the basketball team, those sources said.
Securing any amount of clean energy fund dollars for a rehab of the city-owned arena, which opened in 1995, is far from guaranteed. Program proposals require a recommendation from a citizen-led advisory committee and approval from the City Council, while climate, racial and environmental justice groups that helped champion the fund’s creation are likely to remain influential in any final funding decision.
“While specifics have not yet been finalized, discussions between city leadership, the (program’s advisory) committee, and Portland City Council are underway on this topic,” Donnie Olievera, a deputy city administrator, said in a statement.
Wilson did not respond to a request for comment.
Money from the climate tax is intended to finance projects that aim to reduce carbon emissions, create jobs, promote workforce training in the clean energy sector and help vulnerable residents who face some of the most severe impacts from climate change.
Previous efforts by some city leaders to steer money from the program to other non-climate purposes has prompted fierce opposition.
One Portland lawmaker, Angelita Morillo, who co-chairs the council’s Climate, Resiliency and Land Use Committee, said she first learned of the proposal to potentially put climate dollars toward Moda Center when an Oregonian/OregonLive reporter contacted her Wednesday to ask about details.
“That’s pretty wild,” Morillo said. “No one has talked to me about this.”
The Trail Blazers are attempting to secure $600 million in public funds from the state, city of Portland and Multnomah County for a significant remodel of what is often called the oldest, non-renovated arena in the NBA.
The effort is driven by the pending sale of the basketball team to a group led by Texas billionaire Tom Dundon, which agreed to buy the team for $4.25 billion last summer.
The absence of an arena deal would stoke concerns that Dundon could be motivated to attempt to move the team to a city with a more business-friendly environment and more sponsorship dollars.
Under a working proposal, state lawmakers would contribute $360 million toward that cause through bonding that would need to be approved in the short legislative session that started this week, while Multnomah County leaders have publicly floated a $75 million commitment.
Portland would therefore be on the hook for the remaining balance. The city is expected to contribute roughly $50 million in business license tax generated by the sale of the Blazers, sources said, as well as a portion of revenue from Portland’s spectator facilities fee. Currently, the only fees collected at Trail Blazers games are directed toward Moda Center renovations but sources have indicated the team is asking for fees from all arena events to be reinvested into the project.
Portland’s one-of-a-kind clean energy fund, approved by voters in 2018, is seeded by a 1% surcharge on sales at large retailers in the city such as Walmart and Target. It generates about $200 million in revenue each year and is projected to raise more than $1.6 billion through 2028.
Any move to pour money into the Moda Center project would likely stretch the limit of what the fund is intended to do. It would also require changes to the city’s existing Climate Investment Plan, the program’s five-year spending blueprint, officials said.
Last month, city officials and staff led the advisory committee’s co-chairs, Deangelo Moaning and Tracy Scott, on a site visit of the Moda Center to build support for a potential funding ask. Neither Moaning nor Scott responded to requests for comment from The Oregonian/OregonLive.
Portland Councilor Steve Novick, the other co-chair of the council’s climate committee, sounded a note of skepticism in an interview Wednesday.
“Don’t get me wrong, I think it would be disastrous for the Blazers to leave Portland, both emotionally and economically,” Novick said. “But I just don’t see renovating the Moda Center as a reasonable use for the clean energy fund. It’s supposed to reduce carbon emissions, not fix basketball stadiums.”
Jenny Lee, deputy director of the Coalition of Communities of Color, one of the leading groups behind the creation of the clean energy fund, has her own concerns.
“It’s critical to understand how this will advance the fund’s goals,” Lee said. “I hope whoever is proposing this is coming forward with clear details about how this aligns with the program.”
Gosia Wozniacka contributed to this report.