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By Janie Har August 30, 2012

Did Clackamas County negotiate a $19.9 million TriMet deal, down from $25 million?

A majority of the Clackamas County Board of Commissioners recently approved a new agreement that reduces the county’s share of paying for TriMet’s new Orange line project, better known as Portland-Milwaukie Light Rail. This prompted many pats on the back from the county.

Here’s the first sentence from the county media release sent out to press: "Clackamas County Commissioners on Wednesday approved a re-negotiated agreement to lower the county’s contribution to TriMet’s Portland-Milwaukie Light Rail project to $19.9 million from $25 million and approved the sale of bonds to pay the obligation."

The three commissioners who voted in favor put out statements congratulating their financial savvy. The re-election campaign of commission Chair Charlotte Lehan issued a press release that stated that "the new terms are expected to save Clackamas County taxpayers at least $6.6 million in general fund obligations."

Commissioner Jamie Damon, also up for re-election in November, issued a campaign release that stated that the settlement would "save over $5 million -- a reduction of over 20 percent from the original $25 million project."

Commissioner Ann Lininger, who is retiring, submitted a guest column to The Oregonian in which she said the county approved a $19.9 million financing plan and settlement terms to fulfill its obligations to TriMet. She also said the agreement enables the county "to avoid a late-payment penalty of as much as $1.25 million."

Cool, right? Taxpayers love saving money. And commissioners probably think this is a good way to placate residents who are on the fence about a MAX line between Portland and Milwaukie. The agreement comes before a Sept. 18 election on a county ballot measure, which, if approved, would require voter approval before officials can spend money on light rail.

Instead of singling out a commissioner, we will focus on the statement put out by the county since it sums up nicely the numbers on which the three-member majority wants to focus: $19.9 million versus $25 million.

The new agreement with TriMet does slice $2.4 million from the $25 million. But that leaves a balance of $22.6 million, not $19.9 million. The county also agrees to other actions that are in-lieu of cash payment:

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  • Donate a parcel of land with a real market value of $20,915.
  • Pay for road and signal improvements worth $1,279,740.
  • Waive the county’s engineering fees, valued at $1,365,307.

The total value of the listed in-kind contributions comes to $2,665,962 -- resources that could be used for other county services if they weren’t going toward light rail. Subtracting those contributions leaves a cash balance of $19,934,038 the county owes TriMet. In other words, $19.9 million. (The county isset to sell $19.1 million in bonds Sept. 6, toward the balance due.)

The Oregonian’s Clackamas County reporter has consistently characterized the cost of the new agreement with TriMet as $22.6 million, even if the new amount that requires financing is lower.  We think that’s more accurate, despite politicians’ inclinations to inflate. So does Dan Chandler, strategic policy administrator and the county’s point man on the subject.

"The reduction in borrowing is $5 million, but the actual savings are less than that," Chandler said.

The original agreement signed in February 2010 called for Clackamas County to pay TriMet $25 million toward the cost of the $1.5 billion project. Section 4.1 of the contract states the county could meet that amount by lump-sum payment or payments or in-kind contributions, or any combination.

Let’s return to the statement: Did the commission approve a new deal that lowers the county’s contribution to $19.9 million, down from $25 million? It did not.

The county’s financial contribution to TriMet for the new Orange line is now $22.6 million, much of which will be financed by borrowing. The in-kind contributions come from money the county will now forgo or must spend to meet its obligations. Those are real dollars.

We find the statement to be False.

Our Sources

The Oregonian, "Clackamas County commissioners approve $22.6 million agreement with TriMet for Portland-Milwaukie light rail," Aug. 23, 2012
Clackamas County, "Clackamas County Commissioners approve new TriMet agreement saving county millions and adding improvements," Aug. 23, 2012
Ann Lininger, "Clackamas County commissioners made the right choice on TriMet settlement," Aug. 27, 2012
Clackamas County and TriMet, "Memorandum of Understanding," August 2012
Interviews with Dan Chandler, Clackamas County, Aug. 29, 2012

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Did Clackamas County negotiate a $19.9 million TriMet deal, down from $25 million?

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