[PRCo] OT: Portland StreetCars & Earl Blumenauer and the ”transportation mafia”

[Jim Holland]

-------- Original Message --------
Subject: 	Fwd: Earl Blumenauer and the ”transportation mafia”
Date: 	Sun, 18 Nov 2007 02:03:13 -0000

	

	



--- In LRPPro...s.com, Dave Dobbs <ddobbs at ...> wrote:

After I read the story below from the Willamette Week, I found the 
comments about it equally interesting. Go to:

http://portlandtransport.com/archives/2007/09/mafioso.html

Dave Dobbs
Texas Association for Public Transportation
9702 Swansons Ranch Road
Austin, Texas 78748-1424
(512) 282-1149
ddobbs at ...

Visit us at:
http://www.lightrailnow.org

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http://wweek.com/editorial/3345/9589/

Willamette Week
Wednesday, September 19th, 2007

Gravy Train

Earl Blumenauer and the "transportation mafia"

BY Corey Pein

On March 18, 2003, President George W. Bush told Congress he was about 
to invade Iraq. We all know how that went.

That same day, Rep. Earl Blumenauer, a Portland Democrat, introduced a 
bill to create a federal grant program for streetcars.

That effort has gone a bit better.

Two weeks ago, Portland got closer to benefiting from Blumenauer's work 
and receiving $75 million in federal funding for the eastside extension 
of the streetcar. While Portland's westside streetcar was built mostly 
with local money, the planned eastside loop—which will eventually cross 
the Broadway Bridge and run down to the Oregon Museum of Science and 
Industry—will be financed with tax dollars collected from citizens all 
over the country. It would be the first time such a big chunk of federal 
money—more than half the projected $147 million cost—has gone toward 
streetcars.

If the feds OK the funding—approval is possible by next spring—it will 
be another coup for Blumenauer, a streetcar booster for 20 years. It's 
no small feat to win congressional support for an anachronistic form of 
public transit, especially during an administration that prefers war 
machines.

"Earl, he's the godfather, you know," says Jeffrey Boothe, director of 
the national Community Streetcar Coalition.

Boothe's label cuts both ways. An analysis of public records, campaign 
finance reports and interviews with people here and in D.C. illustrates 
the murky ground on which the business of Washington sits. Depending on 
your point of view, Blumenauer has either masterfully maneuvered the 
levers of Washington to achieve longstanding goals, or brazenly used 
tens of thousands of dollars he's raised from those who stand to benefit 
from the streetcar expansion to make federal funding possible. And at 
the center of this effort are Blumenauer and his best friend, Rick 
Gustafson, whose employer has already received over $2 million in 
streetcar work.

"If this were money coming from a company seeking a big defense 
contract, and then—oh, what do you know—they got it, people would be 
jumping up and down," says Massie Ritsch of the Center for Responsive 
Politics. "It's hard to get worked up about a mass transit project. It 
serves a large number of people."

Some still manage to get agitated. "These guys are obsessed with 
trains," says Jonathan Charles, who heads the libertarian Cascade Policy 
Institute. "They know these trains don't make any sense" as a private 
investment, Charles says, so they go after federal funding instead.

"They call it the `transportation mafia,'" says Portland City 
Commissioner Erik Sten, who counts himself a streetcar supporter. The 
term, Sten says, is meant endearingly. "I think there's some jealousy in 
other circles because they're so effective."

And "Earl is the godfather for sure," Sten says.

Blumenauer is proud of his work with the streetcar. "It's something I 
passionately believe in, and it's made a big difference in Portland," 
Blumenauer says. "I think people like the work I do. I hope they like 
the work I do."

Earl Blumenauer, 59, is a different kind of politician. He's no 
baby-kisser. Not for him is the affability of Gov. Ted Kulongoski, who 
would just as soon talk baseball as discuss state issues. Neither does 
he have the rumpled earnestness of U.S. Sen. Ron Wyden, or the hellfire 
passion of U.S. Rep. Peter DeFazio.

Blumenauer, by contrast, is cool, steely, bow-tied and somewhat 
misanthropic (even his wife has been known to kid him for not liking 
people).

He has been in public office since the age of 23, when the Lewis&Clark 
College grad entered the Oregon Legislature. He later served as a 
Multnomah County commissioner, and on the Portland City Council until 
joining Congress in 1996.

The focus of his career has been livability—supporting local 
agriculture, bicycling and light rail. His work has helped save Portland 
from looking like Houston.

While the streetcar may not be the capstone to Blumenauer's record as a 
livability wonk, it is certainly a demonstration of what he does 
best—and an example of why some say the federal campaign-finance system 
needs to be reformed.

Like many elected officials, Blumenauer has gone on record criticizing 
the role of money in politics. At the same time, he has used the current 
system as well as anyone.

With perhaps the safest seat in Oregon (his district votes 
overwhelmingly for Democrats), he has never had anything but token 
opposition. In 2004, for example, his Republican opponent was Tami Mars, 
an executive at a Portland jewelry manufacturer with no government 
experience. Blumenauer beat her with 74 percent of the vote, a typically 
large margin for the congressman.

Despite his safe seat, Blumenauer has been a surprisingly aggressive 
fundraiser, raising more than $4.1 million since he was first elected.

Federal law limits the money one donor can give to a candidate's 
campaign to $2,300 per election. Shortly after he joined Congress, 
Blumenauer formed a leadership political action committee (PAC), a 
well-worn tool politicians use to circumvent the federal $2,300 limit. 
These PACs allow donors to give another $5,000 a year. While PAC money 
can't be spent directly on campaign expenses, it can pay for travel and 
be shared with other candidates, burnishing the stature and thus the 
electability of an incumbent.

Such PACs are common but controversial. "They're a means to evade the 
contribution limits," says Meredith McGehee, policy director of the 
Washington, D.C.,-based Campaign Legal Center. "If you want to move up 
into leadership positions, or you want to run for president, they're 
almost essential."

Over the past decade, Blumenauer's PAC has raised more than $1.1 
million, much of which has come from the same people who contributed to 
his reelection campaign, including people who have a direct interest in 
the streetcar.

They include Michael Powell of bookstore fame, who has given $12,000 
over the years to Blumenauer and his PAC; Hank Ashforth, a large Lloyd 
District property owner, who gave $7,500; Rick Parker, an eastside 
businessman who, with his wife, gave $38,000; Pearl District developer 
John Carroll, who gave $21,000; and another developer, Dick Cooley, who 
with a few of his employees gave a total of $17,700.

All sit on the board of Portland Streetcar Inc., the nonprofit that 
oversees the streetcar for the city. And all have a stake in the 
streetcar's success, because having a transit line nearby adds value to 
their properties. "Your property will probably be worth four times as 
much," Powell, who chairs the PSI board, told the City Council this 
August. "It brings three million customers' eyeballs onto your business."

Rick Parker, a Republican, says he's known Blumenauer since the 
"super-nice" congressman was a city commissioner. "That's why I've tried 
to help him out where I can," Parker says. "It's just been exciting to 
see a congressman from the east side get some seniority, and get us some 
things once in a while."

An analysis of Blumenauer's PAC shows that $162,000 has gone to fellow 
members of Congress who had one thing in common: They could help direct 
federal funds to the streetcar. That's nearly the same amount he has 
received from people WW can identify as having an interest in the streetcar.

The recipients were current and past members of the House Transportation 
Committee, on which Blumenauer served until last year. Among the top 
recipients:

Leonard Boswell of Iowa, who was given $20,000 from Blumenauer's PAC. 
Michael Michaud of Maine, who was given $16,000. Rick Larsen and Brian 
Baird of Washington state, who received a total of $22,000. All of the 
above were Blumenauer's colleagues on the committee that considered his 
streetcar bill, which was folded into a larger $244 billion 
transportation package. The transportation bill, which passed almost 
unanimously in 2005, created a new Federal Transit Administration 
program to give money to smaller projects, including streetcars.

Members of Congress who took money from Blumenauer—and returned WW's 
calls—denied that his donations influenced their support.

"Money is often given to get access to the decision makers," says Ritsch 
of the Center for Responsive Politics. "Blumenauer is a decision maker, 
so he had the access. The money may have been the cherry on top to make 
things happen."

When asked if his largesse helped get colleagues on board with the 
streetcar, Blumenauer said: "Well, [it] doesn't hurt. Part of what we 
try and do is develop a constituency for programs that would give people 
more control over their communities." Later, he added: "I have never 
accepted or given a contribution with a specific or implied request to 
anyone to support funding for a project in my district or for any other 
quid pro quo."

Chris Smith, who chairs the citizens advisory council for PSI, doesn't 
think Blumenauer's PAC contributions got Portland any special treatment. 
"In general, the impact of money on politics concerns me," says Smith, 
who may run for City Council next year. "With the way the game is played 
in Washington, I'm not sure Earl does anything that's particularly 
untoward."

Property owners aren't the only people who stand to gain from their 
contributions to Blumenauer.

A number of contractors who have given to Blumenauer and his PAC have 
already benefited from previous streetcar work and will probably benefit 
from the eastside extension.

The largest donor was Stacy&Witbeck construction, which also had the 
single largest streetcar contract: $34 million to lay track on the west 
side. Two of its top executives, John Bollier and Ronald Wells, have 
given nearly $70,000 to Blumenauer's funds. (In 1994, Stacy&Witbeck was 
banned from contracting with the City of San Francisco for overcharging, 
only to have the ban rescinded after hiring a lobbyist close to the 
mayor. The company went on to win a $118 million contract to build a new 
streetcar line.)

Employees of LTK engineering and Zimmer Gunsul Frasca architects have 
contributed $23,500 to Blumenauer over the years. LTK has overseen 
manufacture of the cars themselves, and ZGF has helped with planning and 
design.

"I am proud that a number of those people are friends and supporters of 
mine," Blumenauer told WW by phone from Washington, D.C.

"The streetcar is something I believe in, have worked for and championed 
for over 20 years, and there are any number of people who have supported 
me since before there was a streetcar," Blumenauer said. "I don't see 
any problem with [their contributions], and I don't think anybody else 
does."

The most interesting local connection to Blumenauer and the streetcar is 
the private nonprofit that runs it. Unlike, say, the bus system or light 
rail, which is operated by TriMet, a public agency, the streetcar has 
been run, since its inception, by the private nonprofit Portland 
Streetcar Inc.

While the City of Portland owns and is ultimately responsible for the 
streetcar, PSI manages the seven-mile line, plans new lines and chooses 
contractors. The nonprofit was formed in answer to the city's 1995 call 
for streetcar bids. The deal has been amended and renewed as the 
streetcar has grown.

The reasons for this "public-private partnership" depend on who you ask. 
Some say bringing the private sector in was the only way to pay for the 
streetcar, and that TriMet had little interest in trolleys. Others say 
the nonprofit allowed developers to retain more control over the routes 
and limit their risk. The structure is either "lean and efficient" (says 
Blumenauer) or "very corrupt" (says streetcar critic Charles).

Blumenauer was Portland's city commissioner in charge of transportation 
when PSI was formed. "Frankly, although we've had a great partnership 
with three general managers at TriMet, if this had been something that 
had just been dumped on them, it probably would not have ever gotten to 
the top of the list," he says.

The first PSI board was a self-selected group that included many developers.

And for most of the time since then, the guy in day-to-day charge of the 
streetcar has been Rick Gustafson, PSI's executive director.

If Blumenauer is the transit godfather, Gustafson is his consigliere.

The two men are best friends, says Gustafson, having known one another 
since they attended Centennial High School in Gresham.

"I don't know what difference it makes to Willamette Week who my `best' 
friend is," Blumenauer says.

They are also business partners, sharing real-estate investments in 
several properties around the city, according to Gustafson and the 
federal financial disclosures Blumenauer files each year.

Gustafson joined Blumenauer in the Oregon Legislature in 1975 after 
working for TriMet. Before that, he worked for General Motors in 
Detroit. After the Legislature, Gustafson went on to become Metro's 
first executive officer, serving the regional government until 1987. 
Since then, he has worked at Shiels Obletz Johnsen, which manages 
transportation and development projects for public and private clients. 
Shiels Obletz hired Gustafson in 1987 to work on a Portland contract for 
the Jefferson Street Rail Line to Lake Oswego. Blumenauer was the 
commissioner for transportation at the time. He told WW back then that 
he'd had nothing to do with his friend's hiring.

Rep. Blumenauer tells WW the same thing today, in regards to the 
streetcar, stressing that's he's never had influence over the awarding 
of city contracts, during or after his time on the council.

"None of this has anything to do with Earl," Gustafson says. "When we 
first bid on this thing, I wasn't part of the deal."

Gustafson is not paid for his role as PSI's director. But the nonprofit 
has awarded his firm, Shiels Obletz, at least $2.3 million in consulting 
contracts, according to a May 2007 tally by the city.

Principals at the firm—including Gustafson—have given nearly $27,000 to 
Blumenauer and his PAC since 1996.

Outsiders might find it odd, and possibly sticky, to have a nonprofit 
award large contracts to its director's firm. "It's a potential conflict 
of interest," says Andrew Svitek, a Portland nonprofit lawyer. He adds, 
"It only becomes a problem if you can show that somebody got 
preferential treatment." That's a difficult thing to show.

Others use stronger language. "It stinks to high heaven," says Laura 
Otten, director of the Nonprofit Center at LaSalle University in 
Philadelphia. She says a nonprofit director's company benefiting from 
contracts with the organization is "one of the biggest red flags you can 
wave."

"The board has the right to say, `We have a bid process,'" Otten says, 
"but there isn't a person whose eyebrows aren't going to be raised."

Gustafson, Powell and Vicky Diede, the city's streetcar project manager, 
stress that each streetcar contract follows a competitive bid process, 
subject to approval by the City Council. But since 1995 no company has 
ever bid against Shiels Obletz Johnsen.

"They're very valuable to us," Diede says. "They do have a lot of 
knowledge." PSI chairman Powell says nobody does a better job than 
Gustafson's firm.

"If I were advising the board, I would want them to get a couple of 
other bids," says Susan Gary, a University of Oregon law professor 
specializing in nonprofits.

There were a few questions about PSI's ongoing contract at a Sept. 6 
City Council meeting. Mayor Tom Potter wanted to know whether PSI makes 
any money by acting as a pass-through for government funds. (It doesn't, 
though it does bill for board expenses.) Commissioner Dan Saltzman also 
had questions, but he didn't press too far.

"The whole issue with Shiels Obletz Johnsen and Richard Gustafson…I 
frankly didn't want to go there," Saltzman said after the meeting. 
(Saltzman's sister, Julie Leuvrey, serves on PSI's board.)

Those who oppose the streetcar as a waste of taxpayers' money have 
seized on Blumenauer's network as an example of what is wrong with 
government. Said one prominent elected official, a Democrat who asked 
not to be identified, "It's certainly a very chummy group."

Says Charles of the Cascade Policy Institute: "All these little public 
processes they have, they're all done deals. You know they're not going 
to consider something different. Any public participation process is all 
for show."

But for streetcar supporters, it is simply part of the game, one that 
Blumenauer has played extremely well. "Blumenauer absolutely gets the 
credit. He worked very hard" to create a federal program for streetcars, 
says Portland City Commissioner Sam Adams, who now oversees the Office 
of Transportation.

The fruit of Blumenauer's work has been renewed interest in streetcars 
in cities around the country. Certainly, not every streetcar contractor, 
in Portland or elsewhere, has donated to the congressman. And not every 
lawmaker who supports streetcars has taken money from Blumenauer's PAC. 
But his success at creating a nationwide network of streetcar supporters 
is undoubtedly impressive. Last week, for instance, House Speaker Nancy 
Pelosi (D-Calif.) was in Portland, talking up streetcars as an 
eco-friendly mode of transit. Sitting next to her there inside the 
Oregon Convention Center was the savior of streetcars, Earl Blumenauer.

--- End forwarded message --- ^~^~^~^~^~^~^~^~^~^
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Jim  Holland
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Studying Pittsburgh Railways Company (PRCo)
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..............................From 1930 -- 1950
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Pennsylvania  Trolley  Museum  (PTM)
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http://www.pa-trolley.org/
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N.M.R.A.
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http://www.nmra.org/