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Rainier Economic Development Council getting back on track

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RAINIER — After members of the public and the Rainier Economic Development Council raised concerns about the committee’s operations in June, it is taking steps to get back on track.

At a Monday meeting, REDCO, which is made up of City Council members, officially passed an intergovernmental agreement ending the $75,000 annual payment from the city to the council which had ceased in practice some years before.

The council also heard from City Administrator Scott Jorgensen that he had resumed sending an annual report to the special taxing districts involved, which the city also stopped doing at some point in prior years.

“I am pleased to report I was able to obtain annual reports for REDCO going back many years,” Jorgensen said. “I made sure taxing districts had them ... I know it was important to the board, so I made sure it got done,” he said.

Rainier Economic Development Council starts inquiry into transparency questions

This summer, REDCO initially refused to pass its budget, putting the city in jeopardy of not making legally mandated payments as part of a 2012 settlement with U.S. Gypsum. Several members first voted against the budget because of some addition errors, missing reports and intergovernmental agreements.

REDCO budget committee member Terry Deaton and REDCO member Connie Budge brought up concerns about spotty record keeping, missed reports and a lack of REDCO policy and procedure education for new members at a June 16 meeting.

REDCO was created to attract businesses to Rainier. In 1999, it agreed to buy land from the Port of St. Helens for the U.S. Gypsum manufacturer to locate in Rainier.

The committee borrowed $3.4 million from USG and bought the property. REDCO was supposed to repay the loan in two separate installments of $300,000 annually over the span of 11 years beginning in December 2006, but could not make the payment due to a cap it had placed on its annual revenue the year before.

As REDCO was allowed to collect $300,000 per year — half of the required loan repayment — REDCO sued USG and the urban renewal consultants in April 2009 for misleading the agency with the original plan. U.S. Gypsum countersued.

A settlement reached in April 2012, requires the city and REDCO to pay U.S. Gypsum about $4.8 million by Dec. 31, 2029, or approximately $275,000 every year. By the end of 2021, the city will have about $1.85 million in principal left to pay off, according to a city settlement schedule.

In August, REDCO directed Jorgensen to investigate the original settlement agreement to see if prior payments by the city were subtracted from the final settlement sum; to check which special taxing districts were still contributing to the city to help pay for the settlement; to send the required annual reports to those taxing districts; and to draft a resolution officially terminating the intergovernmental agreement between REDCO and the city.

Rainier Economic Development Council passes budget, despite member concerns over transparency

REDCO and City Council used to be separate groups, but were merged in recent years, making the $75,000 payment redundant.

REDCO members Budge, Mike Kreger and Robert DuPlessis were physically present Monday night, while Jenna Weaver called in to achieve a quorum. Members Jeremy Howell, Levi Richardson and Scott Cooper were absent.

The economic development committee also heard the city is pursuing a regional federal grant for communities that have nuclear plants in them.

“It’s a pot of money out there for nuclear communities and we have a good chance of getting some of it because none of it has gone to Oregon recently,” Jorgensen said.

The city is hoping to use the money to do a comprehensive master plan update for its water and sewer systems.


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