LOS ANGELES - Faced with legal challenges to its plans to construct a publicly-backed hotel near the Oregon Convention Center, the Metro Council in Portland, Ore. has asked a judge to validate its financing plan for the project, which includes issuing up to $60 million in bonds.
Metro filed a validation action Tuesday in Multnomah County Circuit Court, which asks the court to review the legal decisions upon which the convention hotel project is based.
Specifically, it asks the court to validate a bond measure and a contract to engage in a public-private project.
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.
"I am confident that the court will confirm Metro's legal authority and clear away any doubt that this project should move forward," Metro President Tom Hughes said in a statement.
Opponents of the plan, 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.
Andy Shaw, chief of staff to Hughes, said Metro has answered many questions raised by the group of opponents, but now it seems that the group is just trying to delay and obstruct the process of the project. Receiving validation from the court would put an end to that.
"It would stop a continuous process of lawsuits and challenges from holding the project up," Shaw said. "That will expedite the process and clear the questions that remain around the project and we hope save money and time as we move this project forward."
Funding for the $198 million plan to build a 600-bed Hyatt Regency would come from $60 million of bonds, issued by Metro and backed by room taxes generated at the new hotel.
Another $18 million in loans and grants would come from the city, state, and Metro. The remaining costs would be funded with investments from Hyatt, its development partners, and other private investments.
Metro, which operates Portland's convention center, says the hotel would attract five to ten more conventions every year, boosting tourism spending and creating jobs in Portland.
Metro officials have said construction on the hotel is planned to start in late 2014, with completion about two years later.
