On the heels of an intense lobbying campaign by the Portland Trail Blazers, the Oregon Legislature last month passed a $365 million funding package to renovate the Moda Center contingent on the Blazers remaining in Portland under new majority owner Tom Dundon.
State leaders trumpeted the passage of the funding package as an economic boon for Portland and a necessary first step to secure the Blazers’ future in the city, pending contributions totaling well over $200 million from the city of Portland and Multnomah County. Others weren’t quite so pleased.
“There’s been a lot of panic,” Portland City Councilor Steve Novick, who represents District 3 in Southeast Portland, said.
Now, as the city and county weigh contributing hundreds of millions of their own dollars to a renovation project that could cost the public more than the $600 million requested by the team, questions are mounting about the rush to approve funding for arena upgrades and what the public might get in return for any such investment.
“Portlanders need to understand how decisions are being made: what’s on the table, how public dollars would be used,” District 3 Councilor Tiffany Koyama Lane said. “So far, the process has kept community in the dark, mostly—and that needs to shift.”
Koyama Lane has been an outspoken critic of the arena funding process for several months. In February, she was the only member of City Council who declined to sign a letter applauding the progress of the funding package for the Moda Center through the State Legislature.
Since then, Koyama Lane has continued to cast a critical eye on the progress of arena funding talks—particularly at a moment when the city and state are facing budget crises that could result in cuts to a variety of essential services.
“I hear folks talking about how this arena has not had a renovation in 30 years—I’m going to hold that at the same time as having taught in our public schools for nearly two decades, where I’ve seen ceiling tiles fall on children’s heads,” Koyama Lane said.
Koyama Lane is far from the only person concerned about the speed at which state and city officials have rushed to sign off on a handout to a Blazers ownership group that just purchased the team for $4.3 billion and is led by an owner whose personal net worth is estimated at more than $2 billion.
Councilor Elana Pirtle-Guiney, one of three councilors who represents District 2, where the Moda Center is, wants to see the city strike a balance.
“We know that Portlanders feel strongly about keeping this team,” Pirtle-Guiney told the Mercury, but said the city’s deep loyalty shouldn’t translate into a position of weakness when it comes to re-negotiating lease terms at the Moda Center. “We need to make sure that when we enter those negotiations, we get a good deal for all Portlanders.”
Edan Krolewicz began following the Blazers when he was living in Portland in the late 2010s, and though Krolewicz moved back to New York City during the pandemic, his love of the Blazers stuck: he watches every game from his Brooklyn apartment. Krolewicz’s love of Portland stuck too—he and his family are moving back to the city this summer.
When Krolewicz began reading about a potential arena funding deal for the Moda Center over the winter, he quickly developed questions about what a deal would cost and why local officials appeared to be taking such a conciliatory approach to the team and league.
“I think there’s a plausible rationale for doing the renovation—it is an old stadium, we do need to actually renovate it,” Krolewicz, who has launched the website Rip City Not Rip Off, said. “I think it will help all the acts, not just the Blazers, that are there. However, we need to actually make sure that we get a return on the investment.”
Getting a return on an investment in an arena, as Krolewicz has surmised, is difficult. Roger Noll, an emeritus professor of economics at Stanford University, said public investments in stadiums and arenas are almost always economically inadvisable.
“The reason you can get away with [funding] is not because it creates a commensurate amount of economic activity to justify the cost,” Noll said. “It doesn’t. The reason people are willing to pay it is, they’re being held up. They’re in a situation where they lack economic power compared to the economic power of the team because the team has a unique and irreplaceable product.”
The threat, of course, whether expressed implicitly or explicitly, is that a team that doesn’t receive public funding will move—and there is little question that a desire to keep the Blazers in Portland has been the driving force behind the push to commit public money to the arena project.
But despite Portland’s smaller market size and Dundon’s lack of personal connections to the area, there are questions about how feasible it would be for him to move the team to begin with.
For one, relocating professional sports teams is often an expensive and protracted process: the NBA, for instance, requires teams to pay a fee just to apply for the opportunity to relocate a team and total relocation costs can run into the billions.
Then there are the particulars about where the Blazers might go. In late March, the NBA’s Board of Governors voted unanimously to explore expanding the league to 32 teams by adding new franchises in Seattle and Las Vegas—potentially weakening the market for the Blazers.
NBA Commissioner Adam Silver has not ruled out the possibility of relocation in recent public comments on the future of the league, but the Blazers, even with the Moda Center aging, do not appear to be prime candidates for relocation anyway.
“If I thought that additional public investment was absolutely needed, I would probably be willing to send something to the ballot and vote for it myself—but I would be willing to abide by the judgement of my fellow Portlanders as to whether it was worth it to them.”
Portland City Councilor Steve Novick
The Memphis Grizzlies and New Orleans Pelicans, for instance, are both facing expiring leases on their respective arenas at the conclusion of the 2028-2029 season, and both play in considerably smaller media markets than the Blazers do. Earlier this month, Sheel Tyle, a member of the new ownership group who lives in Portland, said relocation is not on the table.
Given all those factors, Novick said he hasn’t seen any compelling reason to be concerned about the Blazers departing—no matter how long it takes to hash out an arena funding deal.
“The [NBA] wouldn’t want to expand to Seattle and then lose Portland and lose the natural rivalry,” Novick said. “Nobody ever explained to me why, if we didn’t act now, then the Blazers would be on a plane out of town on June 26th or something.”
Krolewicz, who sees the odds of relocation as similarly low, said he wants local elected officials to realize they have some amount of leverage in regards to any arena funding deal.
“No one is actually thinking about this as a genuine negotiation,” Krolewicz said. “It’s just like, ‘Hey, we don’t want to be the people who let the Blazers go.’ And the reality is it would cost the Blazers way, way, way more to leave than just stay and participate and pay some money on this.”
What kind of return on investment the city and state might get from a Moda Center funding deal remains to be seen, but arena and stadium deals in other cities provide a template for what Oregonians might expect.
“If you just look at a list of stadium deals over the last decade or so, it’s very clear that a lot of jurisdictions got much more than Portland is seemingly getting: things like rent, payments in lieu of taxes, broad community benefits agreements—it’s pretty standard practice to negotiate,” District 4 Councilor Mitch Green said.
Those payments and benefits are particularly important given how economically damaging public investments in arenas can be for cities and states and given the state-approved money is contingent on contributions from the city and county.
Rip City Not Rip Off, for instance, has called for private investment in the arena renovations, a yearly contribution to the city’s general fund, payments in lieu of taxes, and a longer length of lease. Councilors and unions have also called for enhanced labor protections for Moda Center workers.
Koyama Lane, who is part of a new group formed by Council President Jamie Dunphy to explore the pros and cons of a potential funding deal, said she has been in communication with elected officials across the country who have worked on stadium deals and is planning on sharing her findings with the public in the near future.
The key, Green said, is for the city to understand that the economics of a giveaway for arena funding are not in its favor and act accordingly.
“The first question you need to ask is, are people accepting that as the starting position? Or do they dismiss that as the starting position? And the city of Portland right now seems to have dismissed that as a starting position and has substituted instead basically unscrutinized figures from a pitch deck from the Trail Blazers organization,” Green said.
The particulars of how the city might fund its portion of the renovation costs is not clear, either. Novick and Koyama Lane have both rejected an idea floated by Mayor Keith Wilson to help finance an arena funding deal with millions from the Portland Clean Energy Fund (PCEF), with Koyama Lane saying she opposes using PCEF as a “slush fund.”
Novick said he would be more amenable to sending a one-time bond measure to the ballot for voters to approve or reject using their tax money to fund arena upgrades.
“If I thought that additional public investment was absolutely needed, I would probably be willing to send something to the ballot and vote for it myself—but I would be willing to abide by the judgement of my fellow Portlanders as to whether it was worth it to them,” Novick said.
Novick said that, if he does become convinced that public investment is necessary, he would be interested in working with Metro to put a regionwide bond measure on the ballot—a proposal that would lower the per-person cost of the bond.
Green said he would also consider putting arena funding to a vote.
“I suspect that if you laid out some very clear terms in that ballot language that said these are the public benefits we’re expecting, this is the cost, these are the tradeoffs, and then referred it, I think you’d see an overwhelming support for it,” Green said. “But voters are not going to do that if you can’t make the case that we’ve fought for good community benefits.”
