"No Clear Answers" About How City Property Would End Up in a Water District's Hands, Internal City Hall Memo Says

As Portland City Hall braces itself for a May vote that could strip its authority over its water and sewer bureaus, the city's lawyers are scrambling to understand what the ballot measure could mean for Portland property and finances.

The short answer: If Ballot Measure 26-156 passes, the rest of 2014 will be spent divvying up ownership of property and employees between the city and a new public water district.

An April 3 memo from the City Attorney's Office to Mayor Charlie Hales, released in response to a records request from WW and The Oregonian, shows the far-reaching effects—and uncertainty—created by changing the government that oversees public utilities.

"In numerous instances," the memo says, "the measure's language raises questions to which there are no clear answers."

The memo confirms previous reporting by WW that as much as $43 million in city funds could be jeopardized by the new board.

That money is paid by the water and sewer bureaus to other parts of city government—paying for legal advice, mechanics repairing bureau vans, payroll costs and other shared overhead.

A few other highlights from the memo:

1. If the measure passes May 20, the City Council will have less than a month to draw the seven geographic zones for the new elected board. "City Council must 'divide the district' into seven zones by July 15, 2014," the two attorneys write. The first board election would be this November, and the utility board would begin running the water and sewer bureaus starting Jan. 1, 2015.

1. Like a couple getting a divorce, the city and its new water district would have to split up stuff. "If an asphalt truck is used to repair potholes in a street one day," the memo says, "and to pave over a [Bureau of Environmental Services] trenching job the next, it would need to be determined whether that truck is an asset that is to be transferred to the district."

1. The City Council and the new utility wouldn't just divide up property, but workers. That process could take years. "The city's most recent experience in transferring employees between PDC and the Housing Bureau (including fewer than 100 PDC staff) took approximately a year to process," the attorneys write. "The transfer to the [water] district would involve significantly more employees."

Measure 26-156 co-petitioner Kent Craford says the City Attorney's Office is wrong in stating property will have to be divided between the city and the water district.

"The City Hall minions working to protect the status quo have made a basic error here," Craford tells WW. "What is property of the city today will remain property of the city tomorrow. To suggest otherwise is either ignorant, or an intentional attempt to mislead the voters."

Hales' office declined comment. 

WWeek 2015