Hotel proponents score another legal victory, but process will likely drag on

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Supporters of a proposed Hyatt hotel near the Oregon Convention Center were celebrating another legal victory Thursday, but the project still faces challenges before it can go forward. For the second day in a row, a county judge ruled that Metro has the authority to issue bonds to help pay for the proposed hotel.

For the second day in a row, a county judge ruled that Metro has the authority to issue bonds to help pay for the proposed hotel. This time, Clackamas County Circuit Court Judge Henry Breithaupt issued a bench ruling, dismissing a case from project opponents.

The opponents claimed that Metro was required to get voter approval before it could issue $60 million in bonds to support construction of the $212 million hotel. The bonds would be paid back with room taxes off stays at the Hyatt.

On Wednesday, Multnomah County Judge Eric Bloch ruled that Metro was acting within its charter-granted authority to issue the bonds. Opponents of the project, backed by the owners of the Provenance hotel group, said they would appeal Wednesday's ruling to the Oregon Court of Appeals.

It was unclear Thursday whether Metro could issue the bonds while an appeal was pending. It can take months before a case is ready to get on the court's docket – and even longer before the case can have a hearing.

In Tacoma, the Provenance group successfully stalled the development of a proposed Residence Inn by Marriott for years, issuing a number of legal and political challenges to the new development.

According to the Tacoma News-Tribune, five years of litigation ended earlier this year, when the Tacoma City Council agreed to give Provenance a $2.5 million subsidy on parking lots adjacent to a Provenance-owned hotel, selling them to Provenance for a third of their assessed value.

In an email shortly after Breithaupt's ruling, Metro spokeswoman Stephanie Soden said it's unclear what practical impact, if any, an appeal would have on Metro's ability to issue the bonds.

"Two judges have now independently confirmed that Metro has the legal authority to proceed with the project and issue bonds in accordance with the terms of Metro’s Development Agreement," Soden said. "Unfortunately, Metro is unable to prevent the small but well-funded opposition from using their considerable resources to delay the project – but we nonetheless remain focused on moving forward as our community expects."

Metro officials hope the $212 million Hyatt will attract new conventions to the Oregon Convention Center, which Metro owns and operates. In exchange for $78 million in public subsidies, including the $60 million in bonds that would be repaid through room taxes, Hyatt would hold a 500 room block open for future conventions and operate the hotel at an upper-upscale rating.

– Nick Christensen

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