I would like to know about the terms of the lease. What is the city receiving currently from the Blazers, and will that amount go up with a new lease in order to amortize the requested improvements? Does the city receive significant income from other events that take place at the Moda center, or where does that go?
What narratives like yours ignore is that the Blazers do not own the stadium, the city does. The Trailblazers are the best and only tenant, and they pay $6 million per year for their tenancy. They also provide employment for what, 1000 people? No small feat in a city like ours that is falling behind on employment numbers. Dundon rightly recognizes what he is and is not responsible for as a tenant. Any tenant who payed handsomely for their rent and got a crumbling property in return would be right to pack up and leave, regardless of their financial situation.
The city and county appear to be taking the lead from Seattle and Oakland—cities that “stuck to their principals” and lost their sports teams. As a lifelong blazers fan who understands that once Portland loses our NBA team, it’s never coming back, I’m disgusted at the lack of urgency and care this city is showing regarding our team. At least our mayor gets it.
Michele Peters, Great commentary, well researched and thoughtfully presented. Successful businessmen negotiate, they push and push. Dundon is no exception.
Our mayor on the other hand is a " pleaser". He is not a fighter. He doesn't want a sour story to tarnish his record ( his reputation is already on display).
I, for one, do not care if the Blazer's leave. A long season of watching primadona athletes ( arguably the best) play one type of game during the regular season and a better one in the playoffs. Watching on TV is just fine.
If the Commissioners and City Council push back and call Dundon's Bluff, we may actually win.
The Boston Celtics played in decrepit South Station for decades and were beloved champions.
What happens to the Moda center if the blazers leave …..The Portland Trail Blazers and the Rose Quarter generate roughly $670 million annually in overall economic activity. This operational footprint supports approximately 4,430 local jobs and drives $113 million in visitor spending across Portland's dining, retail, and transportation sectors…..get real….call Dundon bluff and he moves the team to Nashville or some place else.
View of someone who has not attended a Blazer game in 20 years, but would still hate to see them leave Portland: The return on that investment extends beyond the City’s balance sheet. The Blazers bring more than 40 regular-season home games to the Moda Center each year, generating business for restaurants, hotels, parking operators, retailers, and hundreds of arena employees. The team also provides national visibility for Portland and serves as the anchor tenant that helps support concerts, tournaments, and other major events. While economists debate the size of these economic benefits, they are not zero and should be part of any discussion about the public value of the investment.
Supporters also argue that Portland will face significant capital costs regardless because the City owns the Moda Center. Many of the building’s systems are now 30 years old and require replacement whether the Blazers remain or not. From that perspective, the choice is not between spending hundreds of millions of dollars and spending nothing. It is between investing now to extend the useful life of a publicly owned arena with an NBA anchor tenant or postponing necessary work and potentially facing even greater costs later.
To Michele Peters’ point, the City should negotiate the strongest deal possible. Mayor Wilson should avoid publicly signaling concessions before negotiations are complete and instead allow the City’s negotiators to pursue the best agreement for taxpayers—even if that means accepting the possibility that the Blazers could ultimately decide to leave.
That said, I suspect Tom Dundon currently has more negotiating leverage than the City. If the Blazers leave, Portland would still own an aging arena requiring substantial maintenance, and attracting another NBA franchise would likely require many of the same investments being debated today. Dundon is also a seasoned businessman who built his fortune through hard-nosed negotiations. Assuming he is bluffing would be a risky negotiating strategy.
Spot on! Economic consensus shows that major league sports arenas and stadiums rarely provide a positive financial return or massive economic growth for host cities. While proponents argue that facilities boost local business and tax revenue, extensive research indicates that sports venues do not increase overall employment or average income levels.
I've given this a lot of thought, even commented on it, when the subject first came up in these pages a few months ago. As long as we're talking business here. Let's get into some specific details.
First let's talk about what the franchise brings economically. I love that everyone drops some stratospheric numbers pulled out from any old place that suits their argument. So, lets be a bit clearer here and talk about some basics that are guaranteed truths and then you realistically decide if the financial impact is a gain.
And before I tear into this a little bit. Let us all remember that we voted for this mayor because he was a successful businessman and understood how to run a business. He told us he was tackling City problems with the experience of a man who practiced problem solving from a long career in business. Really? Anyone want to tell me why this successful businessman, so experienced, was busy misdirecting our attention to his gallant fight for homeless shelter beds, which he can't now finance beyond December 2026, while ignoring the devastating budget short fall of City, County and Metro. Could this businessman not see that giant vacancy rates and failing lease cash flows would have a devastating affect on property value and taxations or not see that crises-style sale of giant towers and city blocks in downtown Portland, selling at pennies on the dollar - and not foresee a coming crises in budgets? (But, this is a whole other topic.) The point is, I couldn't count on this guy or his staff of press releasing misinformation specialists to understand anything below.
Let's first look at the income generated coming into the state. After all, we are an affluent state, of sorts, lots of money from outside this state flow into it, from all sorts of state-wide businesses selling products and services outside our border. The net from that sale comes back here and becomes part of the state-wide flow of money. Sure lots of it flows back out, from purchase of raw goods and out of state services that these businesses cannot get at competitive prices or technology in state. But, the goal, in Econ 101, is to see that the state nets more dollars in than goes out.
Now someone, anyone with some serious numbers, tell me exactly how many out of state dollars does this franchise bring into the state - and how much of that is a net that remains here increasing the prosperity of those who live her? Anyone?
I can't find those numbers. I don't think they exist. And they likely don't exist because no one - not the franchisee, not the NBA and not our government elected officials want to really know what the net state income impact is. But, we can use our imagination to get a few ideas how this works. And I will start with sales income. Where does the gross ticket sale income come from? From out of state or outside the Metro area flow of dollars? Do you really think that a measurable size of the ticket sales, of each home game, is purchased from people coming from outside the state or metro-area market place? I'm not talking Bend or Grants Pass, I want to know what percentage of gross attendance sales (in all ticket type capacities) flow dollars to the state or market area, that were not already here. Why? Because our economy is served by two commodities: sale generation in state and sale generation out of state. But only one increases a growth in state wide revenue, increasing the amount of dollars which can continue to flow in state. And that's luring those dollars from out of state. So how is this franchise doing this, in the same way and same impact as our timber industry or Nike or our networking, software and personal computer industry?
Well, kids, they're not. Seriously. The vast majority of all gross sales made by this franchise in ticket sales comes from within our state and general market area. Sure, there might be some season ticket holders from Longview, plenty from Vancouver - where the richest Oregonians moved to avoid Oregon personal tax rates. But, they are not significantly bringing in a net return form outside the state. And mind, you they have plenty of costs paid outside the state that cause that locally collected money to flow out of state - in franchise fees and broadcast rights, etc. Hell, in net income to the owners who live out of state, in salaries to players and coaching and management staff recruited from outside the state, who maintain homes outside the state, while temporarily employed and living in state. You think all that money stays in Oregon? So let's stop playing stupid here. Show us some really hard evidence that this franchise brings in a useful net income to the state or metro area and I will believe they generate real dollars that assist our economy.
Oh, but I am not being totally fair. Because when anyone wants to float the net income value of the franchise, they turn immediately to it's local impact in opportunity income - for parking lots and restaurants and hotels and every single local sub-contract supplier of goods and services that make up the Moda center and franchise operations. And those that serve the needs of support services adjacent to the center and franchise. It's a nice domino effect. They are churning local dollars. that's what I would call it. They are creating a consumer demand for products and services, redirecting local earned dollars in the hands of local area consumers (state or metro wide) having them redistribute those dollars (corporate advertising, marketing and household entertainment spending) to all related industries tying livelihood to this franchise. It's redistribution of local dollars, changing hands.
Yes, that's a good thing. It's good to get people to spend in order to redistribute wealth between all workers and all industries in the metro area and the state. Just remember that while you are doing it, the guys with the biggest investment, are skimming the profit off the top. The impact is that while generating redistribution, they are redistributing wealth out of the local economy too. And I honestly do not think they are generating more net coming into state or metro area than they are spending and taking it out of state. But, no matter. The politicians don't want you to consider this, they aren't capable of understanding it themselves. For if they were, what remains is an intentional, criminal act of deception - lying to the public with false claims of profit to the state all the while protecting the investment and projected incomes of the wealthy - all financed by a truly ignorant public.
Now let's also be clear about this redistribution taking place. Is anyone here going to tell me that it wouldn't happen anyway? You mean that all those area corporations and consumers who spend money on this NBA form of entertainment simply will refuse to spend that same money on some other local entertainment? And you are going to suggest that they would rather save their money and not spend it, thereby refusing to regenerate the flow of local dollars in the community if they can't have this franchise to spend it on? Well, if that were even laughably true, the end result would clearly be more private and public savings, more wealth being held in savings rather than spent for recirculation. But that's nonsense. Of course they'd spend it. They would find other forms of entertainment. Maybe they'd buy more power boats. Maybe they'd go to more college games or switch their focus to minor league baseball. There is not an infinite amount of entertainment dollars available for recirculation in our state, but it's clear that there would be other entertainment to replace this one, to spend money on. It's not like these consumers won't find a replacement entertainment to occupy their leisure time. Maybe, even maybe, the household wives might claw back more of the household leisure dollars to spend towards entertainment that appeals to them. Maybe the arts might see a lot more money flow back to it, after decades of seeing it flow way, while this franchise and the Timbers got more insatiable. The point is, it is a joke to claim that this expenditure, which constitutes a redistribution of wealth locally, would cease to exist just because it currently is attributable to this franchise. I doubt those claims ae genuine to begin with, but the inference made by people claiming this is a benefit is that our economy would suffer at it's loss. Well, explain to me how it will be lost? At best, it's saved, at worst it's redistributed to some other leisure entertainment.
But, now let's now look at it from a business investment. Because, after all, this article wants us to consider the business side of this extortion proposal. I'm good with that. Let's begin by taking a look at the Moda Center investment. Who paid for it and who owns it? The public. Well, the City of Portland owns and manages it, they used public tax dollars, from a variety of sources, to build this capital asset. That's what's its called on a balance sheet. Then, to operate it in manner intended to generate revenue, they make the property available to entertainment operators who wish to lease it for a set period of time. You could call the NBA franchisee a resident anchor tenant. (I honestly do not know if they are the primary tenant with rights to sublease to every other entertainment operator wishing to lease the space while they remain there or whether those added leases are with the City. It really doesn't matter. The end result is that the City pulls a gross income from leasing the building.)
And they have overhead, there is management and maintenance and repairs and that must be maintained - whatever responsibilities fall to them as building owners (unless the master lease is triple net. We the public, who own this building, don't know. We are not privy to the specific terms of these arrangements.) But, for all of you who understand business, please tell me the following: as a responsible business owner, do you invest in capital assets and ignore their life expectancy? Do you make any provision for repair or replacement? Well, yes, most companies understand that a capital asset has a life expectancy, requires repair or replacement eventually and they retain earnings, year over year, to prepare for that expense as it comes to maturity. Now, my owner-fellow Portlanders - where's the City's effort to do that? Where is their remodel fund? These high-minded business people, are they retaining earnings yearly, a piece of the lease income, to cover upgrades and replacements? Because that's a standard practice of business, what responsible businesses do.
But, apparently not municipal governments. Nope, they let the operator pay whatever lease amount assures them a return on their investment annually (forget the profit when the franchise is sold) and the City simply lets the capital asset deteriorate until the need for repair or replacement arrives - upon which they seek new tax dollars or create new debt instruments to cover that expense. Like any business? Nope, not like any business that shows a shred of understanding and responsibility to it's share holders. But, then this is a city that expects it's share holders (the public) to be completely ignorant in these matters.
So I have this fundamental problem with this extortion event taking place. I am a little, well a lot, angry with my elected officials who are too stupid to understand that public investment in capital assets require that sufficient income be generated, and sufficient net annual income set aside, to meet the projected needs of future repairs, rehabs or replacement of those assets. That includes not just the Moda Center, but the Keller Auditorium, the Schnitzer and all of the entertainment complexes being poorly managed on our behalf as the public owners.
I don't expect anything to change. The media hasn't the mental acuity to understand this, media investors have dismantled public reporting to a point where public knowledge and opinion has atrophied. It is far better that the power elite keep the public stupid, uninformed and distracted with their toys. What I would like is, if you are going to have a serious chat about the economic impact let's start by getting real. We're fed misinformation and it's clear a majority of the public is too ignorant, too distracted and too lazy to care about reality. They prefer to pay the extortion and be left alone. And clearly the media prefers to favor the wealthy, their owners, and keep the public ignorant. Save this publication doing what it can. Unless you can build public awareness, followed by serious public anger and resentment, nothing here is gonna change. PSU, down in student enrollment and subsequent tuition income, shuttering some programs, struggling to balance their budget, is barreling head long into developing a completely unnecessary 3,000 seat auditorium on campus, with a savvy construction partner anxious to secure that big publicly funded project for their own profit, is working in concert with these same City leaders to snow the public in another fiasco - at tremendous cost to tax payers. Let's be clear here: The wealthy call upon elected officials to steer public money to their income-producing projects. Moda is just one of them. The State and The City are both firmly entrenched in seeing this get played out. They will lie about it's benefit, play on the sympathies of those fearing a franchise loss and count on the continuing ignorance of the public to see the private investors get what they want. How do you really propose to change a quid-pro-quo system like that, hundreds of years in successful operation?
Our mayor is not a fan of transparency. As the owner of a private business I suspect he made decisions independently and then informed his management team and staff. But as a mayor with limited independent authority, that management style doesn't work. He should be open, honest, and working with the Council to develop their support for expenditures.
This gotcha technique was on full display when he signed a 12 year lease for a shelter in the Pearl District without discussing its ramifications with the community. When the neighborhood reacted and pushed back promises were made hastily but without sufficient funding and support by the council, they could not be kept. Then he claimed to be closing the shelter in a few months. Now, we find out he has signed a new lease agreement through December. Another deal made behind closed doors.
Regarding the Moda center funding, it's clear he simply did not have the authority to make a financial commitment on behalf of the city when pressured by the governor. Now he is getting cranky and scolding the community when people are asking questions and the council is pushing back. Whether or not the negotiations with the Blazers are successful, the mayor has made a number of foolish turnovers and his three point play needs work.
If Tom Dundon offends every Portland constituency at once, which he is apparently trying to do, he can demonstrate to fellow NBA franchise owners that Portland is a hopeless case: can't raise the public dollars and the citizens/taxpayers/fans are unforgiving. He needs the approval of NBA owners to move, and they are less likely to allow it if there is widespread support for the franchise. They don't care if Dundon is a jerk. They want the Blazers in a city with a new arena and an enthusiastic fan base.
Thank you. Your analysis is sharp, and I think there is one vulnerability worth adding. NBA owners approving relocation is not simply about whether a city is “supportive.” It is about money. A franchise relocating carries real revenue risk for the league. Portland has a demonstrated fan base with decades of loyalty. Owners watch gate receipts, local broadcast deals, and merchandise. Those numbers don’t disappear because Dundon is difficult.
If Portland holds firm, requires private investment, and the deal still gets done on reasonable terms, Dundon has nowhere to go with that narrative. The relocation story only works if the public money actually dries up completely.
Which brings us back to my previous conclusion. Don’t collapse. Call the bluff. A negotiated deal with genuine private participation is both the fiscally responsible outcome and the one that defeats the strategy you are describing.
I would like to know about the terms of the lease. What is the city receiving currently from the Blazers, and will that amount go up with a new lease in order to amortize the requested improvements? Does the city receive significant income from other events that take place at the Moda center, or where does that go?
What narratives like yours ignore is that the Blazers do not own the stadium, the city does. The Trailblazers are the best and only tenant, and they pay $6 million per year for their tenancy. They also provide employment for what, 1000 people? No small feat in a city like ours that is falling behind on employment numbers. Dundon rightly recognizes what he is and is not responsible for as a tenant. Any tenant who payed handsomely for their rent and got a crumbling property in return would be right to pack up and leave, regardless of their financial situation.
The city and county appear to be taking the lead from Seattle and Oakland—cities that “stuck to their principals” and lost their sports teams. As a lifelong blazers fan who understands that once Portland loses our NBA team, it’s never coming back, I’m disgusted at the lack of urgency and care this city is showing regarding our team. At least our mayor gets it.
Michele Peters, Great commentary, well researched and thoughtfully presented. Successful businessmen negotiate, they push and push. Dundon is no exception.
Our mayor on the other hand is a " pleaser". He is not a fighter. He doesn't want a sour story to tarnish his record ( his reputation is already on display).
I, for one, do not care if the Blazer's leave. A long season of watching primadona athletes ( arguably the best) play one type of game during the regular season and a better one in the playoffs. Watching on TV is just fine.
If the Commissioners and City Council push back and call Dundon's Bluff, we may actually win.
The Boston Celtics played in decrepit South Station for decades and were beloved champions.
I say, Let them eat cake.
Thank you.
What happens to the Moda center if the blazers leave …..The Portland Trail Blazers and the Rose Quarter generate roughly $670 million annually in overall economic activity. This operational footprint supports approximately 4,430 local jobs and drives $113 million in visitor spending across Portland's dining, retail, and transportation sectors…..get real….call Dundon bluff and he moves the team to Nashville or some place else.
View of someone who has not attended a Blazer game in 20 years, but would still hate to see them leave Portland: The return on that investment extends beyond the City’s balance sheet. The Blazers bring more than 40 regular-season home games to the Moda Center each year, generating business for restaurants, hotels, parking operators, retailers, and hundreds of arena employees. The team also provides national visibility for Portland and serves as the anchor tenant that helps support concerts, tournaments, and other major events. While economists debate the size of these economic benefits, they are not zero and should be part of any discussion about the public value of the investment.
Supporters also argue that Portland will face significant capital costs regardless because the City owns the Moda Center. Many of the building’s systems are now 30 years old and require replacement whether the Blazers remain or not. From that perspective, the choice is not between spending hundreds of millions of dollars and spending nothing. It is between investing now to extend the useful life of a publicly owned arena with an NBA anchor tenant or postponing necessary work and potentially facing even greater costs later.
To Michele Peters’ point, the City should negotiate the strongest deal possible. Mayor Wilson should avoid publicly signaling concessions before negotiations are complete and instead allow the City’s negotiators to pursue the best agreement for taxpayers—even if that means accepting the possibility that the Blazers could ultimately decide to leave.
That said, I suspect Tom Dundon currently has more negotiating leverage than the City. If the Blazers leave, Portland would still own an aging arena requiring substantial maintenance, and attracting another NBA franchise would likely require many of the same investments being debated today. Dundon is also a seasoned businessman who built his fortune through hard-nosed negotiations. Assuming he is bluffing would be a risky negotiating strategy.
Spot on! Economic consensus shows that major league sports arenas and stadiums rarely provide a positive financial return or massive economic growth for host cities. While proponents argue that facilities boost local business and tax revenue, extensive research indicates that sports venues do not increase overall employment or average income levels.
Part 1
I've given this a lot of thought, even commented on it, when the subject first came up in these pages a few months ago. As long as we're talking business here. Let's get into some specific details.
First let's talk about what the franchise brings economically. I love that everyone drops some stratospheric numbers pulled out from any old place that suits their argument. So, lets be a bit clearer here and talk about some basics that are guaranteed truths and then you realistically decide if the financial impact is a gain.
And before I tear into this a little bit. Let us all remember that we voted for this mayor because he was a successful businessman and understood how to run a business. He told us he was tackling City problems with the experience of a man who practiced problem solving from a long career in business. Really? Anyone want to tell me why this successful businessman, so experienced, was busy misdirecting our attention to his gallant fight for homeless shelter beds, which he can't now finance beyond December 2026, while ignoring the devastating budget short fall of City, County and Metro. Could this businessman not see that giant vacancy rates and failing lease cash flows would have a devastating affect on property value and taxations or not see that crises-style sale of giant towers and city blocks in downtown Portland, selling at pennies on the dollar - and not foresee a coming crises in budgets? (But, this is a whole other topic.) The point is, I couldn't count on this guy or his staff of press releasing misinformation specialists to understand anything below.
Let's first look at the income generated coming into the state. After all, we are an affluent state, of sorts, lots of money from outside this state flow into it, from all sorts of state-wide businesses selling products and services outside our border. The net from that sale comes back here and becomes part of the state-wide flow of money. Sure lots of it flows back out, from purchase of raw goods and out of state services that these businesses cannot get at competitive prices or technology in state. But, the goal, in Econ 101, is to see that the state nets more dollars in than goes out.
Now someone, anyone with some serious numbers, tell me exactly how many out of state dollars does this franchise bring into the state - and how much of that is a net that remains here increasing the prosperity of those who live her? Anyone?
Part 2
I can't find those numbers. I don't think they exist. And they likely don't exist because no one - not the franchisee, not the NBA and not our government elected officials want to really know what the net state income impact is. But, we can use our imagination to get a few ideas how this works. And I will start with sales income. Where does the gross ticket sale income come from? From out of state or outside the Metro area flow of dollars? Do you really think that a measurable size of the ticket sales, of each home game, is purchased from people coming from outside the state or metro-area market place? I'm not talking Bend or Grants Pass, I want to know what percentage of gross attendance sales (in all ticket type capacities) flow dollars to the state or market area, that were not already here. Why? Because our economy is served by two commodities: sale generation in state and sale generation out of state. But only one increases a growth in state wide revenue, increasing the amount of dollars which can continue to flow in state. And that's luring those dollars from out of state. So how is this franchise doing this, in the same way and same impact as our timber industry or Nike or our networking, software and personal computer industry?
Well, kids, they're not. Seriously. The vast majority of all gross sales made by this franchise in ticket sales comes from within our state and general market area. Sure, there might be some season ticket holders from Longview, plenty from Vancouver - where the richest Oregonians moved to avoid Oregon personal tax rates. But, they are not significantly bringing in a net return form outside the state. And mind, you they have plenty of costs paid outside the state that cause that locally collected money to flow out of state - in franchise fees and broadcast rights, etc. Hell, in net income to the owners who live out of state, in salaries to players and coaching and management staff recruited from outside the state, who maintain homes outside the state, while temporarily employed and living in state. You think all that money stays in Oregon? So let's stop playing stupid here. Show us some really hard evidence that this franchise brings in a useful net income to the state or metro area and I will believe they generate real dollars that assist our economy.
Oh, but I am not being totally fair. Because when anyone wants to float the net income value of the franchise, they turn immediately to it's local impact in opportunity income - for parking lots and restaurants and hotels and every single local sub-contract supplier of goods and services that make up the Moda center and franchise operations. And those that serve the needs of support services adjacent to the center and franchise. It's a nice domino effect. They are churning local dollars. that's what I would call it. They are creating a consumer demand for products and services, redirecting local earned dollars in the hands of local area consumers (state or metro wide) having them redistribute those dollars (corporate advertising, marketing and household entertainment spending) to all related industries tying livelihood to this franchise. It's redistribution of local dollars, changing hands.
Part 3
Yes, that's a good thing. It's good to get people to spend in order to redistribute wealth between all workers and all industries in the metro area and the state. Just remember that while you are doing it, the guys with the biggest investment, are skimming the profit off the top. The impact is that while generating redistribution, they are redistributing wealth out of the local economy too. And I honestly do not think they are generating more net coming into state or metro area than they are spending and taking it out of state. But, no matter. The politicians don't want you to consider this, they aren't capable of understanding it themselves. For if they were, what remains is an intentional, criminal act of deception - lying to the public with false claims of profit to the state all the while protecting the investment and projected incomes of the wealthy - all financed by a truly ignorant public.
Now let's also be clear about this redistribution taking place. Is anyone here going to tell me that it wouldn't happen anyway? You mean that all those area corporations and consumers who spend money on this NBA form of entertainment simply will refuse to spend that same money on some other local entertainment? And you are going to suggest that they would rather save their money and not spend it, thereby refusing to regenerate the flow of local dollars in the community if they can't have this franchise to spend it on? Well, if that were even laughably true, the end result would clearly be more private and public savings, more wealth being held in savings rather than spent for recirculation. But that's nonsense. Of course they'd spend it. They would find other forms of entertainment. Maybe they'd buy more power boats. Maybe they'd go to more college games or switch their focus to minor league baseball. There is not an infinite amount of entertainment dollars available for recirculation in our state, but it's clear that there would be other entertainment to replace this one, to spend money on. It's not like these consumers won't find a replacement entertainment to occupy their leisure time. Maybe, even maybe, the household wives might claw back more of the household leisure dollars to spend towards entertainment that appeals to them. Maybe the arts might see a lot more money flow back to it, after decades of seeing it flow way, while this franchise and the Timbers got more insatiable. The point is, it is a joke to claim that this expenditure, which constitutes a redistribution of wealth locally, would cease to exist just because it currently is attributable to this franchise. I doubt those claims ae genuine to begin with, but the inference made by people claiming this is a benefit is that our economy would suffer at it's loss. Well, explain to me how it will be lost? At best, it's saved, at worst it's redistributed to some other leisure entertainment.
But, now let's now look at it from a business investment. Because, after all, this article wants us to consider the business side of this extortion proposal. I'm good with that. Let's begin by taking a look at the Moda Center investment. Who paid for it and who owns it? The public. Well, the City of Portland owns and manages it, they used public tax dollars, from a variety of sources, to build this capital asset. That's what's its called on a balance sheet. Then, to operate it in manner intended to generate revenue, they make the property available to entertainment operators who wish to lease it for a set period of time. You could call the NBA franchisee a resident anchor tenant. (I honestly do not know if they are the primary tenant with rights to sublease to every other entertainment operator wishing to lease the space while they remain there or whether those added leases are with the City. It really doesn't matter. The end result is that the City pulls a gross income from leasing the building.)
And they have overhead, there is management and maintenance and repairs and that must be maintained - whatever responsibilities fall to them as building owners (unless the master lease is triple net. We the public, who own this building, don't know. We are not privy to the specific terms of these arrangements.) But, for all of you who understand business, please tell me the following: as a responsible business owner, do you invest in capital assets and ignore their life expectancy? Do you make any provision for repair or replacement? Well, yes, most companies understand that a capital asset has a life expectancy, requires repair or replacement eventually and they retain earnings, year over year, to prepare for that expense as it comes to maturity. Now, my owner-fellow Portlanders - where's the City's effort to do that? Where is their remodel fund? These high-minded business people, are they retaining earnings yearly, a piece of the lease income, to cover upgrades and replacements? Because that's a standard practice of business, what responsible businesses do.
Part 4 - last in a series
But, apparently not municipal governments. Nope, they let the operator pay whatever lease amount assures them a return on their investment annually (forget the profit when the franchise is sold) and the City simply lets the capital asset deteriorate until the need for repair or replacement arrives - upon which they seek new tax dollars or create new debt instruments to cover that expense. Like any business? Nope, not like any business that shows a shred of understanding and responsibility to it's share holders. But, then this is a city that expects it's share holders (the public) to be completely ignorant in these matters.
So I have this fundamental problem with this extortion event taking place. I am a little, well a lot, angry with my elected officials who are too stupid to understand that public investment in capital assets require that sufficient income be generated, and sufficient net annual income set aside, to meet the projected needs of future repairs, rehabs or replacement of those assets. That includes not just the Moda Center, but the Keller Auditorium, the Schnitzer and all of the entertainment complexes being poorly managed on our behalf as the public owners.
I don't expect anything to change. The media hasn't the mental acuity to understand this, media investors have dismantled public reporting to a point where public knowledge and opinion has atrophied. It is far better that the power elite keep the public stupid, uninformed and distracted with their toys. What I would like is, if you are going to have a serious chat about the economic impact let's start by getting real. We're fed misinformation and it's clear a majority of the public is too ignorant, too distracted and too lazy to care about reality. They prefer to pay the extortion and be left alone. And clearly the media prefers to favor the wealthy, their owners, and keep the public ignorant. Save this publication doing what it can. Unless you can build public awareness, followed by serious public anger and resentment, nothing here is gonna change. PSU, down in student enrollment and subsequent tuition income, shuttering some programs, struggling to balance their budget, is barreling head long into developing a completely unnecessary 3,000 seat auditorium on campus, with a savvy construction partner anxious to secure that big publicly funded project for their own profit, is working in concert with these same City leaders to snow the public in another fiasco - at tremendous cost to tax payers. Let's be clear here: The wealthy call upon elected officials to steer public money to their income-producing projects. Moda is just one of them. The State and The City are both firmly entrenched in seeing this get played out. They will lie about it's benefit, play on the sympathies of those fearing a franchise loss and count on the continuing ignorance of the public to see the private investors get what they want. How do you really propose to change a quid-pro-quo system like that, hundreds of years in successful operation?
Our mayor is not a fan of transparency. As the owner of a private business I suspect he made decisions independently and then informed his management team and staff. But as a mayor with limited independent authority, that management style doesn't work. He should be open, honest, and working with the Council to develop their support for expenditures.
This gotcha technique was on full display when he signed a 12 year lease for a shelter in the Pearl District without discussing its ramifications with the community. When the neighborhood reacted and pushed back promises were made hastily but without sufficient funding and support by the council, they could not be kept. Then he claimed to be closing the shelter in a few months. Now, we find out he has signed a new lease agreement through December. Another deal made behind closed doors.
Regarding the Moda center funding, it's clear he simply did not have the authority to make a financial commitment on behalf of the city when pressured by the governor. Now he is getting cranky and scolding the community when people are asking questions and the council is pushing back. Whether or not the negotiations with the Blazers are successful, the mayor has made a number of foolish turnovers and his three point play needs work.
If Tom Dundon offends every Portland constituency at once, which he is apparently trying to do, he can demonstrate to fellow NBA franchise owners that Portland is a hopeless case: can't raise the public dollars and the citizens/taxpayers/fans are unforgiving. He needs the approval of NBA owners to move, and they are less likely to allow it if there is widespread support for the franchise. They don't care if Dundon is a jerk. They want the Blazers in a city with a new arena and an enthusiastic fan base.
Thank you. Your analysis is sharp, and I think there is one vulnerability worth adding. NBA owners approving relocation is not simply about whether a city is “supportive.” It is about money. A franchise relocating carries real revenue risk for the league. Portland has a demonstrated fan base with decades of loyalty. Owners watch gate receipts, local broadcast deals, and merchandise. Those numbers don’t disappear because Dundon is difficult.
If Portland holds firm, requires private investment, and the deal still gets done on reasonable terms, Dundon has nowhere to go with that narrative. The relocation story only works if the public money actually dries up completely.
Which brings us back to my previous conclusion. Don’t collapse. Call the bluff. A negotiated deal with genuine private participation is both the fiscally responsible outcome and the one that defeats the strategy you are describing.