SAN FRANCISCO - A Multnomah County, Ore. judge has ruled that Portland-area regional government Metro can issue bonds for a hotel at the Oregon Convention Center without voter approval, but the legal process will likely drag on.
Faced with legal challenges to its plans to construct the Hyatt Hotel, the Metro Council in April asked a judge to validate its financing plan for the project, which includes issuing up to $60 million in bonds.
Oregon law provides local governments with the ability to ask a court to confirm the legality of an action they have taken and address any other potential concerns. This allows local governments to address the issues in many potential lawsuits at once.
Opponents, who have objected to the public subsidy for the hotel, have filed lawsuits seeking a referendum on the use of lodging taxes in the financing and challenging Metro's authority to participate in building any venue without a vote.
In an 11-page ruling Nov. 19, Judge Eric Bloch of the Multnomah County Circuit Court ruled that Metro has the authority to issue revenue bonds under the Metro Charter alone. He said that this home-rule charter, approved by the voters, supersedes the state law that requires voter approval to issue bonds.
"[Wednesday's] ruling validates the truth behind the convention center hotel project," Metro Council President Tom Hughes said in a statement. "Judge Bloch made the right decision by finding that Metro has clear authority to enter into the agreements and obligations related to the hotel, clearing away any doubt that this project should move forward."
Metro has been trying for more than a year to begin work on the $212 million, 600-room Hyatt hotel that would be built just north of the Oregon convention center.
The financing plan includes $78 million in public finance to be matched by about $134 million in private-sector investment. Room taxes would pay off the $60 million of bonds.
Metro, which operates the convention center, says the hotel would attract five to ten more conventions every year, boosting tourism spending and creating jobs.
Opponents, backed by the owners of the Provenance hotel group, said they would continue their attempts to stop the hotel's finance plan and file an appeal to the judge's ruling.
Metro officials said it's unclear what practical impact, if any, an appeal would have on its ability to issue the bonds.