House Divided

[April 1st, 2009]

A $25 million low-income housing project for recovering substance abusers will go forward in the Rose Quarter after unions won a puzzling battle with one of their most powerful leaders.

On March 20, Administrative Law Judge Linda Lohr ruled the Rose Quarter Housing project is subject to prevailing wage, union-scale wages that can be as much as 20 percent more than non-union.

Lohr’s ruling could make the project a couple million dollars more expensive, but adds certainty to the unsettled future of Rose Quarter real estate.

The issue began last year when the Bureau of Labor and Industries ruled Central City Concern’s planned renovation of a Ramada Inn at 10 N Weidler St. was subject to prevailing wage because the project was receiving millions of dollars in public funding.

Central City appealed, with the help of a surprising ally—Bob Shiprack, executive secretary of the Oregon State Building and Construction Trades Council. For years, Shiprack led the fight to get projects that received public funding covered by prevailing wage (see “What’s Up Bob?” WW, Oct. 29, 2008).

In legislative testimony, Shiprack said his advocacy for prevailing wage led to $100 million worth of projects paying those rates. Shiprack supported an exemption from prevailing wage for mixed-use affordable projects of four or fewer floors that contained less than 20 percent commercial space. Although Shiprack lost the Rose Quarter battle, he’s continuing to annoy historical allies by taking his quest to the Legislature for an exemption of similar public housing projects, which he says are only a “narrow slice” of publicly funded projects.

At Shiprack’s request, Rep. Mike Schaufler (D-Happy Valley) introduced a bill in January that would exempt future mixed-use projects from prevailing wage. That bill, House Bill 2430, is scheduled for a second hearing before Schaufler’s Labor Committee on April 6.

Representatives of two building trade groups—the International Brotherhood of Electrical Workers Local 48 (of which Shiprack is a member) and Operating Engineers Local 701—said Shiprack’s bill would represent a major concession in pay.

“Commercial work has never previously been exempt from prevailing wage,” IBEW 48 general counsel Norman Malbin testified.

Meanwhile, Central City plans to begin renovation of the former Ramada just north of the Rose Garden arena as soon as the end of April.

The project will create 176 studio apartments for low-income Portlanders recovering from substance abuse, says Central City executive director Ed Blackburn.

Central City’s plans preceded the recent land rush in the Rose Quarter, which pits the Blazers’ recently unveiled plans for a “live entertainment district” of bars, restaurants, a boutique hotel and possibly housing versus the City Council’s recent approval of plans to replace Memorial Coliseum with a new minor-league baseball stadium (see cover story, page 15).

Three weeks ago, Blackburn says the Blazers asked whether the Central City facility might work better in a different location. Blackburn says that although the project has been planned for years, that was the first time he’d heard such concerns.

Blazers President Larry Miller says his organization supports Central City’s mission but worries the Rose Garden and the entertainment district might not be a good environment for recovering substance abusers. “Is that the best location for folks going through recovery?” Miller says.

But Tom Miller, chief of staff to Mayor Sam Adams (and no relation to Larry Miller), says the Blazers’ worries come too late.

“From the city’s perspective, we are committed to supporting the service,” Miller wrote in an email, “and supporting the service at that location absent a better location.”