Pay Up, Y'All! Part Two

How the city, state, and federal government combined to drop $ millions on a single nonprofit--and what that money may or may not buy.

“The past is never where you think you left it.”

—Katherine Anne Porter

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So, Albina got a raw deal.

But raw deals were being handed out wholesale in Portland during the go-go years of the ‘50s and ‘60s, when the city leadership decided to jump on the urban renewal bandwagon.

The Jewish community in South Auditorium got a raw dea, along with the old men taking refuge in the flophouses; no one would get excited about “affordable” housing in Portland for another fifty years. So did the displaced residents of Maywood Park, muscled aside by the I-405. So did the hundreds of homes and businesses demolished along Powell Boulevard, for a freeway that never got built. So did the residents and small businesses in the way of the I-405 Stadium freeway.

Which begs the question: Why are some raw deals more deserving of “restorative redevelopment” than others?

The legion of people poised to consummate the Albina Vision Trust’s gauzy plans for the battered old neighborhood (it’s been essentially defunct for five decades) have said yes—and backed it up with a flood of city, state, and federal money, along with an unprecedented transfer of a public property to private benefit.

Yes, yes, yes—we’ll stipulate that Albina was…here we’ll settle for the Vision Trust’s catch-all term, “thriving” five decades ago.

Which begs another question: If Albina was a mini-utopia, why were blacks and whites lobbying, sometimes at great physical peril, to do away with the covenants, redlines, and “gentlemen’s agreements” that had penned blacks up in Albina in the first place?

The various projects that targeted Lower Albina did not completely transform the neighborhood. (Or the white working-class neighborhoods to the north—the true forgotten folks of the story.) The “destruction” of a part of Albina happened at the same time the state’s first open housing laws were being passed. There was some die-hard resistance. But today, the idea that a black family moving anywhere in Portland would prompt the burning of a cross is beyond absurd.

As a result of the 1953 state law—and the civil rights desegregation movement—blacks, predictably, moved away from their “roots” in Albina. Here’s a recent map showing the current disposition of blacks in Portland…

…while a recent headline noted…

WillyWeek’s Nigel Jaquiss reported…

The demographic shift over four decades in the inner North and Northeast Portland neighborhoods of the Albina District is remarkable. In 1970, census data shows, 9 out of 10 Black Portlanders lived in those census tracts. Today, according to new calculations performed for WW by the Portland State University Population Research Center, just over 1 in 5 Black Portlanders live there.

Since 2015, the Portland Housing Bureau has been actively working to slow or reverse the decline, committing $80 million to a program called the North/Northeast Neighborhood Housing Strategy, which includes home repair loans, mortgage assistance and other investments aimed at keeping residents in Albina—or helping families pushed out by gentrification to return.¹

(We’ll get to that “strategy” in a while.)

Despite these numbers, every power-player in the Progressive Machine™ is marching in lockstep with the proposition that Albina was so special, so singular, so sui generis—supply your own kudos—that it’s worth making sweetheart laws, spending untold $-millions, cutting kinky deals, enriching the usual gaggle of developers for something that looks gauzier the more you look at it.

Was Albina that l’il bit ‘o’ heaven in whitey Portland? Here’s how the Trust makes the case for Albina’s extra-special status:

Admirable programs—none of which seem to be current these days (Portland’s last jazz club went bust in 2016; the tree canopy is declining, and the schools are mired in low test scores). Which should be cast against the fact that Albina’s residents were in a sort of prison with walls made out of mortgage redlining, covenants, and outright segregation.

A slightly different version of the neighborhood’s glory days emerges in former Journal and Oregonian columnist Phil Stanford’s magisterial “Portland Confidential: Sex, Crime and Corruption in the Rose City.” He recounts the years before Oregon finally passed open housing legislation…

Tom Johnson, a highly successful businessman reputed to be worth millions, owned a real estate agency, the Keystone Investment Co., which was situated in a large brick building on North Williams, about a hundred yards north of where the Rose Garden is today.

He sold real estate, all right. He had a corner on the blacks-only neighborhoods. Only a few people knew that he was also active in the white parts of town, buying and selling through Emanuel Green, a man of African and Jewish heritage who, to use the expression of that time, could "pass for white."

Real estate, however, was only one of Tom Johnson's business interests. In the rear of the Keystone was a gambling and after-hours club—just one of several illegal enterprises Johnson had a piece of on the Avenue and elsewhere. In the basement of the Keystone was an eight-foot-square safe filled with stacks of hundred-dollar bills.

Johnson may (or may not; the players didn’t write anything down) have been involved with the plot to plunk down what’s now the Moda Center in—you guessed it—lower Albina. In the tussle between various players over the arena’s location (subject of another documentary by Steve the Historian), this tumbled out: a deal to buy up the land slotted for the center between crime boss Jim Elkins, grubby businessman Clyde Crosby, and Johnson…

This will not be the last instance of behind-closed-doors dealmaking in the Albina saga.

In truth, the history of Albina is irrelevant, a sop to guilty whites in the peanut gallery. The best way to look past the propaganda is to view the Albina Vision Trust as a real estate development company that doesn’t pay taxes. They’re far from being the only players in this arena — as Metro and county government bonds pad the portfolios of the ultra-rich and drop massive “affordable” public housing projects into neighborhoods that lack the clout of, say, Alameda.

It’s telling that the Trust’s first actual construction project is a garden-variety “affordable” apartment block limited to the officially poor, units available only for those with 30 percent to 60 percent of the largely mythical² federal measure of poverty. Its 94 units of public housing were financed by an alphabet soup of government agencies: Portland Housing Bureau (PHB), Metro bonds (MAHB), Oregon Housing Services (OHSC), low-income tax credits (LITC), some leftover COVID-19 relief funds, the Hillman Family Foundation, and Metro Transit-Oriented Development funds. Best guess, given its financial complexity, the project cost taxpayers $ 66.7 million.

Developers of this sort of project—in this case Edlen and Co.³(one of their former midlevel managers, Carly Harrison, is now the Trust’s senior vice president of real estate)—never disclose the per-square-foot cost of such a project; too easy to do the arithmetic. Metro, in for just $ 14.4 million, calculates that their bond funds alone were worth $143K per unit.

…and while it may look like just about any other public “affordable” housing, it’s actually…well, here’s what a Trust copywriter gushed…

PS: There are only 16 parking spaces, and the nearest grocery store is “within a mile.”

As always with these projects, there’s fine print…

Other Incentives: Weatherization grants, System Development Charge (SDC) waivers, Construction Excise Tax (CET) exemptions, contributed developer fees, and donation of land.

This is the heart of the “affordable” game: link for-profit developers with nonprofit 501(c)(3) “owners” of the apartment blocks and cash the government checks. It’s the kind of sure-fire deal that attracts major league players, such as multinational Related Northwest, which did similar mega-projects in Montavilla and St. Johns. From the standpoint of a developer, these deals are a dream: no picky banks, no fees, no taxes, permitting greased, profits guaranteed. Piece ‘o’ cake, with the added benefit that the money is laundered through nonprofits which lack, in real terms, no supervision whatsoever—beyond the opaque IRS Form 990s that are at least a year late.

Give that a moment’s thought—along with the Trust’s assurances that this kind of construction will be a mainstay of their new Albina—and it’s a jaw-dropper: the possibility that, when the dust settles and the Trust has built out the new Albina, most of it will be tax-exempt.

As for what the new Albina will be, after its dose of “restorative redevelopment,” well…it gets a teensy bit vague. Here’s what the Trust hasn’t shared with taxpayers or politicians:

• An actual, itemized list of what will be constructed—and when.

• The actual design of any buildings.

• The purpose of future buildings—commercial, entertainment, cultural, etc.

• No list of how many housing units will be “affordable.”⁴

• How many housing units will be open to ownership?

• No metrics that could form the basis of an ongoing cost/benefit analysis.

There is nothing visual beyond “back of the napkin” sketches that architects call “conceptual.” Which have a disconcerting tendency to look different in different renderings: from dense piles of glowing high-rises to greenhouses to chummy plazas.

Spokesperson JT Flowers painted the Trust’s grand plan with a broad brush…

…which brings us to one of the keystones of the project…

What happens to the Prophet Center?

Recreating Albina couldn’t work without a deal with the Portland Public Schools board to—somehow—lay hands on the 10.5 acres of the PPS’s massive Dr. Matthew Prophet Education Center, which is parked right smack-dab in the middle of the Vision Trust’s target area.

Local media broke into gales of applause when the Board, with Herman Greene cheerleading (a chummy video of Greene and Flowers, pre-vote, has disappeared, but Flowers’s endorsement is still up)…

…voted unanimously to give the Trust “first refusal” to buy the complex. The sweetener was that the Trust would find another place to move the Prophet Center, perhaps even downtown, since real estate values are cratering over there.

Who knows; PPS could wind up in the Big Pink.

The Trust says it has located 14 properties that might fit the bill. The locations are a state secret: by some remarkable coincidence, the candidates will not be sorted out until after the election for the new school board. Green will probably be re-elected, but there’s no telling how new members of the board will feel about the deal, especially if the schools’ $1.83 billion monster bond to do… something…goes down. The fiscal picture will be different. Very different.

Whatever is selected, it will have to be something more than an office with desks,⁵ as the Northwest Labor Press explained, under the headline, “Union Trades Workers Left in the Dark as Portland Public Schools Prepares to Sell HQ.”

Prophet Education Center was purpose-built as a “one-stop shop” for district services, said Jennie Johnson, a journeyman electrician who works in the district’s musical instrument repair shop. The building has special power supplies to support specialized tools and machinery; ventilation systems; storage space for spare parts; freight elevators to move heavy equipment; garage space to easily load gear into vehicles; and central access to all 177 of the district’s buildings, Johnson said.

There’s more small print: according to the Labor Press…

A basic real estate analysis conducted for the potential relocation identified 14 alternative buildings, each with at least 125,000 square feet of office space.

Prophet covers 360,000 square feet. But kindly forget square footage: The Trust promised that if the ultimate winner doesn’t match Prophet’s “value,” the Trust will make up the difference.

But note: there was no independent audit of the Prophet Center’s “value,” or any move to put the Center on the market to see what might stir some real estate mogul’s animal instincts.

As with all “values,” it’s in the eye of the beholder. And one of the beholders has an interest in minimizing that number.

What about the Lid?

For a walk in the truly deep weeds, consider the matter of the “lid” over the infamous I-5, I-84 “merge,” which has been responsible for thousands of fender-benders and digitus impudicus gestures from one motorist to another over the years. ODOT has been hassling with this noxious bit of highway mal-engineering for years, hounded by the Bike Lobby and progressives who hate cars and would like to jackhammer freeways.

The Vision Trust has been dickering with the Oregon Department of Transportation (ODOT) about annexing the lid and even walked away from negotiations in 2020.

Then—surprise...! As reported in BikePortland (strangely, one of the best running accounts of the Vision Trust’s maneuvering)…

Congressman Earl Blumenauer and senators Ron Wyden and Jeff Merkley…have brought home $450 million to construct covers over Interstate 5 through the Rose Quarter, as well as an additional $38.4 million for a complete makeover of Northeast Broadway and Weidler streets to create a new “civic main street” between NE 7th and the Broadway Bridge. The grant is the largest ODOT has ever received from the federal government…

That’s a lotta money—although, as we reported in our first article, these things tend to metastasize, with the ticket now at $2 billion.

Part of the big price tag tracks back to the cap over the freeway: It will be engineered to support up to a six-story building. Which means the Vision Trust can build big—maybe as tall as some of their “conceptual” drawings indicate.

But—waitaminute! Who says the Vision Trust will get the lid? After all, it’s a public facility built with public money. Why not put it out to bids by developers salivating at the prospect of condos with river views (never mind the fumes filtering up from the traffic below)?

Sorry, the Trust’s very good friends down in Salem have put a solution in the pipeline (it may have been passed as you read this, since it is backed by three Machine heavies: Senators Lew Frederick and Kanh Pham, joined by Representative Travis Nelson.)

Short version: The cap gets built (somehow) and handed over, gratis, to the Trust. Case closed. ODOT will go through the formalities of a “work plan” (which will keep squads of bureaucrats busy), but they signed onto a “partnership” a year ago, and that’s that.

Here’s how BikePortland reacted to the development…

Back in ‘24, when the partnership was being discussed at the Capitol, Cascade Policy Institute’s president, John Charles, Jr., wrote a lengthy letter to Julie Brown, chair of the Oregon Transportation Commission. Charles, who has guest-appeared on this website, is a defender of what is amusingly known in Salem as “the taxpayers.” He offered a list of reasons the partnership wasn’t a good idea. Filed and forgotten.

When SB 1182 got tossed into the hopper, he followed up with yet another analysis and appeared as a witness before the Joint Committee on Transportation. As he wrote when I contacted him about the testimony, “If you watch the video of the hearing, you'll see that it was mostly a group hug and I was the only opponent.”

Charles zeroed in on the biggest problem with the Vision Trust’s scheme.

It’s blatantly racist.

No one in the majority party cares much about the Constitutional issues or the enormous cost of this boondoggle. It's no longer a transportation project, it's a racial reparations project.

…and noted in his testimony…

Because this proposal would involve deciding ownership or leasing rights on the cover by a strict requirement of the purchaser being Black, the Legislature has the burden of proving that the category plan is narrowly tailored to serve a compelling governmental interest….

Since ODOT did not consider any policy alternatives that would avoid racial categories, the proposals are unlikely to meet the [Supreme Court’s] narrowness requirement.

….and…

There is a level of uncertainty among the parties involved as to whether the Black Albina community at large will control the Rose Quarter Cap’s development and leases or a specific Black-owned corporation. Either option would qualify as an outright denial of opportunity to lease or develop the I-5 cover to Portlanders and Albina residents who aren’t Black, based solely upon their race, which raises equal protection and other civil rights issues with all of the cap proposals.

The letters should be required reading—and placed in a time capsule to be opened if and when the Vision Trust’s project implodes.

The Cascade Institute’s Charles was one of the very, very few who dared to mention the elephant in the room and the central issue confronting Portland and the Trust…

Race

It permeates their websites, PR, pitches, and rhetoric. The project isn’t just caused by race—it’s for the benefit of one particular race.

The Vision Trust is the progeny of Portland’s twisted centuries-old relationship with not just blacks, but Asians, Jews, Native Americans: the “others.” Its immediate forebear was the riotous ‘20s—when whatever happened to George Floyd was an excuse for Portlanders to join in BLM/Antifa riots, destroy storefronts, and assault the federal building and justice center.

Hovering over everything was Portland’s white guilt, with its overtones of paternalism and dominance, with whites extending charity, granting extra dispensations, lowering graduation requirements, awarding government money on the basis of race, and infesting schools and bureaucracy with DEI apparatchiks and their odious “struggle sessions.” And, always, “equity.” Which translates to what used to be called “stacking the deck.”

But the worm has turned.

Like everything else in American culture, attention span is attenuating, collapsing. The tropes that the race-revolutionaries deployed in the ‘20s now look, well… tired. American citizens generally find it difficult to keep feeling guilty or, for that matter, anything, beyond a year or so. Black Rage and Reparations are so…yesterday. And never forget, Trump got 70,759 votes in Multnomah County.

Like him or not, he has wielded executive power to actively dismantle the leftovers of the Floyd era. He’s working through the list of DEI/racist outliers. We’re on that list.

The Trust and its government allies have tried to finesse their 14th Amendment problems partly with JT Flowers’ bombast, but also by using other government wink-wink, nod-nod policies as cover.

For example, here are the rules for getting one of those below-market-rate pads at Albina One…

…which, atop a picture of blacks in the Albina utopia, tiptoes over the obvious racial-preference issues with “preference” and “generational ties,” while the city program moves in people who had any connection to the neighborhood (a grandparent will suffice) to the head of the line. And that grandparent might not have been actually displaced. Albina was and is a big place…

Who’s kidding whom?

If you read the Cascade Institute’s letters, they read like templates for what could be a very interesting—and dangerous—court challenge to the Trust’s program. It would have been unthinkable four years ago—but, as they say in legal circles, the issue is now “ripe,” thanks to the US Supreme Court’s Students for Fair Admissions decision. Portland attorneys are notoriously reluctant to buck the machine, but miracles do happen. And there are out-of-state players who might wade in.

Call it what you will: “restorative redevelopment,” or “culturally-specific,” or “displaced community members,” or “restitch the district,” or “contextualizing,” or “roots,” it boils down to: Race determines who gets what and when and why.

Without that, the Albina Vision Trust is just another real estate hustle with political connections.

Which is what got the neighborhood in trouble in the first place.

1. Which led the City Charter Commission to lament that it couldn’t find a large enough minority cluster to create a minority-controlled council district.

2. Former US Senator and head of the banking committee Phil Gramm argues that the Census Bureau’s official income statistics, which underpin MFI calculations, exclude most noncash government transfer payments (such as food stamps, Medicaid, and housing assistance), and that Census methodology does not subtract taxes from income, which results in an overstatement of the income of higher-earning households and an understatement for lower-income households.

3. “Our focus is to provide opportunities for affordability and social equity, while scaling the boundaries of sustainable development. We are committed to contributing to the quality of life in the communities in which we are invested.”

4. One well-known effect: as low-income renters’ income levels rise above the MFI limits, they tend to hold onto their apartments to continue to receive the rental break—perversely lowering the apartments available to the truly poor. Additionally, if the area’s overall wealth increases, both income limits and maximum allowable rents rise, even if the incomes of the poorest households do not.

5. You’ll note that the drone-shot of JT Flowers atop the Prophet Center’s roof cuts away before showing its full size.