A long-planned project meant to excise the Portland Streetcar system's last major chokepoint—that bit of track around SW 4th and Montgomery currently shared by trains heading both directions—has been in limbo ever since the demise of the Oregon Sustainability Center last year.

For years, the city planned on running a new double-track on a diagonal alignment through the ground floor of that would-be environmental showpiece. When the building was put on political ice, planners had to head back to the drawing board for a more traditional alignment.

But now, the Mercury has learned, that project might be the canary in the coalmine for another major bit of political uncertainty: whether to back away from an urban renewal area planned around Portland State University—one of the streetcar project's main funding sources.

According to to a budget review (pdf) obtained in a public records request, the Portland Development Commission has pulled back all but $200,000 of the $1.2 million in urban renewal funding it had planned to spend on the $3.8 million project. The project, because of that change, is now facing a $1.6 million shortfall.

Mayor Charlie Hales, for the record, has made no secret he's looking to make changes in the city's URAs. Neither his office nor the PDC has yet to return a message seeking comment on why, exactly, the PDC has decided to pull back on its funding plan for the streetcar track.

Meanwhile, the budget office report shows Hales looking to tap some of the city's newfound windfall in one-time cash, some $11 million worth, to bail out the project and keep it on track. That option is among a handful spelled out in the review.


Last on that list is abandoning the project, you'll note. And that's probably the least likely of them, by far. As the review notes, the city might have to pay the grant money it's already dipped into to pay for design work. And streetcar officials have been adamant that they can't fully develop the system and increase capacity and frequency with the 4th and Montgomery chokepoint still poking everyone in the eye.

This issue is one reason why Hales' office agreed to let the city budget office delay until November 13 a hearing on fall budget updates. The request for analysis on the streetcar came after bureaus made their requests for surplus money and didn't make it into an 82-page report by the budget office giving thumbs up or down on various requests.

The streetcar crisis isn't the only reason the hearing was pushed back, however. Plans for spending $1.7 million in one-time money on homelessness relief and prevention still needed more cooking. Commissioner Dan Saltzman only as of Monday had convened advocates for the second in a pair of steering meetings that tried to tease out the best and most effective ways to spend the cash.

Without that detail, despite council support, the budget office says it doesn't currently recommend the expense.