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Portland Public Schools’ Risky Real Estate Gamble

By Eric Fruits, Ph.D.

On December 2,Portland Public Schools (PPS) board voted unanimously on purchasing the One North commercial building for $16 million to house the Center for Black Student Excellence, but the building’s purchase price is only the beginning. The $16 million building needs another $20 to $25 million in renovations and 24 to 30 months of construction. For the next two years or more, PPS will own an expensive, mostly empty shell. Worse yet, staff cannot confirm whether the central atrium can be preserved while meeting building codes for classrooms.

While fostering student excellence should always be the district’s priority, this plan is fiscally reckless and logistically flawed. In November, Cascade submitted a Memorandum and Analysis to the PPS Facilities Improvement and Oversight Committee enumerating the risks associated with the One North purchase. We felt hopeful when the Oregonian editorial board repeated some of the concerns presented in Cascade’s analysis.

Portland Public Schools faces a $50 million budget shortfall, yet they have committed to purchasing property with a $271,000 annual operational deficit. When board members questioned this gap—money that could fund teachers or educational assistants—proponents dismissed concerns. One called it a “drop in the bucket.” Another complained that questioning the finances “doesn’t feel very fair.”

For taxpayers facing cuts, such resistance to basic financial scrutiny is unacceptable. PPS is now buying a property without knowing its final usable square footage, among other unanswered questions.

Most critically, the center will operate primarily after school, weekends and summers—yet the district doesn’t run buses during these hours. When asked how students from East Portland would access the center, staff called transportation a “puzzle piece we’ll have to figure out.”

There is a better solution: to integrate the center into the Jefferson High School reconstruction already planned. This eliminates costly conversions, cuts delays, and saves tens of millions of dollars.

The board has a mandate to spend $60 million on Black student excellence. It doesn’t have a mandate to spend it foolishly.

*Note: The preceding is an adaptation from a Nov. 30, Oregonian, letter to the editor by Eric Fruits, Ph.D.

Eric Fruits, Ph.D. is an Adjunct Scholar at Cascade Policy Institute. As a consulting economist, he has produced numerous research studies involving economic analysis, financial modeling, and statistical analysis.

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