Skip to main contentWhen the powerful director of the Portland Development Commission abruptly resigned last week, there was much talk of Don Mazziotti's brusque style, fancy suits and power ties.
Many had expected the city's urban-renewal czar to clash with new mayor Tom Potter-Mazziotti's autocratic, secretive approach seemed directly at odds with Potter's vow to make city operations more transparent.
Mazziotti's departure, however, was ultimately not a matter only of style-he hadn't changed much during his four-year tenure. Nor did it hinge on Potter's rise to power. "The decision did not come from this office," says Potter's chief of staff, Nancy Hamilton.
Instead, it had to do with the political ambitions of Matt Hennessee, the chairman of PDC's appointed board.
Hennessee, a former city manager, top aide to Ted Kulongoski and Nike executive, is now the CEO of the financial-services company Quiktrak. In recent months, he has begun shopping around for an elected office to pursue. He declined to discuss the specifics of Mazziotti's departure.
"Don is a talented executive, and he did great work," Hennessee says. "How he did it was the issue for us as a commission. Now he's made a decision to move on, and I support that decision."
(Mazziotti says the decision to leave was his own.)
Two factors made Mazziotti's position untenable. The first was the general climate within PDC. Mazziotti kept an iron grip on operations within the agency, which controls a budget of $300 million and high-profile redevelopment projects such as South Waterfront and the Burnside Bridgehead.
"Management restraints are in place to discourage PDC commissioners and staff at all levels from communicating with each other," concluded a City Club research report on PDC released in January.
(Although performance evaluations for city bureaucrats are public record, PDC counsel denied WW's request to see an outside evaluation of Mazziotti, performed last summer at a cost of $50,000.)
Mazziotti's other problem was the Portland Family of Funds, a PDC offshoot. In 2001, Mazziotti hired the controversial Norris Lozano-who later became PFF's head-despite Lozano's unpaid bills and lingering litigation over a bad investment (see "Coming Clean," WW, Nov. 26, 2003).
After jump-starting PFF with public funds, Mazziotti allowed Lozano to retain control of the organization, which acquires federal tax credits for use in impoverished neighborhoods, when it became independent of PDC. PFF has come under increasing scrutiny in recent weeks on issues ranging from its hefty fees to the lack of transparency in its operations.
"I've got a lot of questions about how PFF was set up," says City Commissioner Erik Sten. "The process to access its funds is not clear, nor is who benefits from the decisions it makes."
Political strategist Mark Wiener says PDC's baggage left Hennessee in a difficult position. Having overseen the formation of PFF as commission chairman, Hennessee, whose term expires in July, could share in any fallout that may occur.
"If you are in a leadership role and there is a budding problem, you have two choices: Take the initiative to address it, or allow others to dictate the course of events," Wiener says. "Letting something fester increases the odds that the situation could bite you in the butt. That's never a pleasant experience, especially if you are looking towards a future in politics."
WWeek 2015