OFF PAGE ONE KITZHABER: Website failed to enroll a single person Page 8A East Oregonian Continued from 1A cials misused federal money and improperly commingled oficial and political resources to enrich Kitzhaber’s polit- ical prospects. However, Democrats on the panel blamed the state’s contractor, California-based Oracle Corporation, for the website’s problems. In their own report released Wednesday, Demo- crats say Oracle failed to deliver a functioning website and misled state oficials. Oregon produced the country’s worst rollout of the new national health insurance program. While the crippled federal website eventually worked, Oregon’s failed to enroll a single person online. The state had to resort to hiring 400 people to process paper applications. The Centers for Medicare & Medicaid Services’ “failed oversight of the development and implementation of Cover Oregon resulted in millions of wasted taxpayer dollars,” the committee said. The federal agency should reform its grant and oversight process, the panel said. The committee said documents and testimony it obtained are consistent with the indings of the Govern- ment Accountability Ofice, a congressional watchdog agency. The committee report also noted Cover Oregon is not unique. “Several other states have had signiicant problems developing and imple- menting a health insurance exchange,” the report said. An email seeking comment from Kitzhaber early Wednesday morning through his iancée, Cylvia Hayes, wasn’t immediately returned. Representatives of CMS declined to comment. Ken Glueck, senior vice president at Oracle Corpo- ration, said Wednesday the company feels “pretty vindi- cated” by the Republicans’ report. Glueck took issue with the report by the panel’s minority members, saying Democrats never responded to company requests for meetings and conducted no analysis of their own. Glueck said Oracle would welcome any independent probes by the Justice Department or the state. Rep. Elijah Cummings, D-Md., rejected Oracle’s claims they weren’t involved in the investigation and said evidence obtained by the panel “reveals a company focused on covering up its incompetence and lining its own pockets at the expense of Americans trying to obtain health insurance.” In other indings, Repub- licans on the committee said: • Oficials with the Centers for Medicare & Medicaid Services applauded the progress at Cover Oregon and awarded the project addi- tional federal dollars even as the quality assurance vendor rated the project as “high risk.” • State oficials and Kitzhaber’s campaign advisers “collaborated to such an extent that the lines between oficial and political activities became blurry.” Kitzhaber resigned in February 2015 amid alle- gations his iancee, Cylvia Hayes, did private consulting work for organizations seeking to inluence state policies. The report noted discussions about Cover Oregon often included individuals with no authority over the matter, and it found that at least one email included Hayes, “who did not have any Cover Oregon role or responsibilities.” In their own report, Demo- crats said Oracle “misled state oficials by repeatedly assuring them its work was on track and on schedule when in fact it was riddled with errors.” The Democrats’ report also said independent experts said Oracle’s work was so lawed that the state should consider withholding payment to the contractor. In March 2015, Gov. Kate Brown signed legislation dissolving Cover Oregon. ROEMARKS: Building served as the library in 1914 Continued from 1A high-visibility space at the corner of Main and Second. They have already heard from some interested parties and said they welcome contact from more. “We really want something cool for the downtown community to go there,” Neighbors said. The Scrubs store, which sells medical professional clothing, already leases space along the Second Street side and will continue to do so from the new owners, and Neighbors said they have a prospective tenant for the space north of Scrubs. He said the second-story renova- tions on that side of the property will take place in a second phase in two years. The eastern side of the building (where RoeMark’s used to sell western wear) and its mezzanine will be converted into a reception area, ofice space and confer- ence rooms for Simmons Insurance. The 6,000-square-foot space will hold administrative ofices and commercial insurance, while Simmons Insurance’s home, auto and health ofices will remain in their current location down the street at 702 East Main. Once renovations are inished in November or December, the company will vacate the space it currently leases for administrative ofices in the 400 block of East Main. Simmons Insurance is a family-owned company founded in Hermiston in 1974. Today it has ofices in 20 locations, but 48 of its approximately 100 employees work in Hermiston. Neighbors said some of those employees have been working from home due to lack of ofice space, but will now have a desk at the RoeMark’s location. Simmons said the renovations that Staff photo by E.J. Harris The RoeMark’s building has been purchased by the Simmons Insurance Group and renovations have begun to transform the former store into ofice space. just got underway will include about $500,000 worth of new HVAC, lighting, windows, looring, walls and other updates. “It will look a lot different,” he said. Despite a complete transformation of the interior, Simmons said the plan was to keep much of the outside brick façade the same, with the exception of replacing the boarded-up window wells with glass panes. The purchase wasn’t oficially announced until Wednesday, but Simmons said as word leaked out in the weeks before, people said they were happy that someone local was going to put the building to good use. “Everyone I talked to is excited because that is a staple of the commu- nity,” he said. The two-story section of the building was irst built in 1907, and in 1914 it served as Hermiston’s public library. Later uses included a ladies’ boutique and the ofices of the East Oregonian from 1968 to 1973, when Roe Gardner purchased the building and renovated it, turning it into RoeMark’s Men’s and Western Wear. To inquire about the retail space that will be up for lease, contact Josh Woods at Simmons Insurance at 866-268-3796. ——— Contact Jade McDowell at email@example.com or 541-564-4536. LAND: Building will cost $4.78M, open by winter 2017 Continued from 1A everyone else as well.” Not only did the port gift several acres of land for each project, but Neal said they will also extend sewer and water services onto each lot. The area will have a far different look than the rest of the port, which is a 24/7 hive of manufacturing. Port businesses make everything from french fries and cheese to wood chips and ethanol. Neal estimates the port accounts for roughly 5,000 jobs, though a whopping 70 percent of workers commute from elsewhere. That, combined with the unique and changing skills required to ill those jobs, has created the demand for local work- force training. Enter BMCC, which will house its data center and industrial technology programs at the Boardman facility. The building will cost $4.78 million and open by winter 2017. “This is a momentous occasion,” said college Pres- ident Cam Preus at Wednes- day’s groundbreaking. “We think this is just the right stuff for the city of Boardman and Morrow County.” Sixteen students have already signed up for the school’s data center program, which is entering its second year. Neal said the port has two sites where data centers are up and running and more could be coming “in the not-too-dis- tant future.” By having BMCC at the port, Neal said they can also help local students make connections that lead to good-paying jobs in their own back yard. “My job is to create jobs for the people I represent,” he said. “Now, I just have to get them skilled up to be ready to enter those positions.” The BMCC Workforce Training Center will also host the school’s early childhood learning classes, allowing those students the opportunity to work directly with the port’s Early Learning Center that will be next door. Neal said that facility should break ground sometime later this year. Because employees at the port work long hours or odd shifts, Neal said they need a place for their young children to receive care and start their education. The Early Learning Center will be operated in partnership with Umatil- la-Morrow Head Start and IMESD, and paid for through $1.6 million in state lottery bonds. Finally, the Boardman Recreation Center is expected to provide another shot in the arm for the community. Nearly 60 percent of voters approved a $12 million bond to build the facility in 2014, which will include an indoor swim- ming pool, gym and training center. Once again, the port stepped up with free land, The Boys are back! Don’t miss this great Portland area band! Sat. May 28, 2016 8:00 pm and even spent $250,000 to move Les Schwab from that location to a new building on Lewis and Clark Drive. Along with the SAGE Center, Neal said the campus was a good it and ills a different role than the rest of the port’s heavy industry. “It’s about supporting the area we serve,” Neal said. “We think we’re striving to do that.” ——— Contact George Plaven at gplaven@eastoregonian. com or 541-966-0825. Thursday, May 26, 2016 Housing costs driven up by high demand, costly regulations By PARIS ACHEN Capital Bureau A conluence of factors — including low supply, high demand, obstructive regulations and inadequate infrastructure — are driving up housing prices in the state, a panel of state econ- omists and housing experts told a legislative committee Tuesday. “There are too few units given the strong and growing demand,” said Josh Lehner, economist with the Oregon Ofice of Economic Analysis. “In such a market, anything available at a remotely reasonable price and/or location is gone instantaneously. The lack of supply drives prices higher.” Panelists recommended a series of policy changes, many of which lay outside the Legislature’s control. Local zoning laws, permit- ting rules and even the state labor commissioner’s interpretation of prevailing wage law for residential construction projects can drive up the cost and time it takes to build units, said Kurt Creager, director of Portland Housing Bureau. “Who moves to Oregon? The short answer is everyone moves to Oregon,” Lehner said. In the past year, the state has attracted more newcomers than it had any year in the past two decades. About 30 new households move to the state or are formed in the state every day. Meanwhile, the state’s stock of affordable housing has failed to keep pace. Portland is a year behind in building new units to keep up with population growth. The city needed 23,000 more units than were built between 2006 and 2015. That combination has yielded the ifth lowest vacancy rate among the 100 largest metro areas in the nation, Lehner said. The economist said he doesn’t know why the city lagged behind in building units. “Coming out of the Great Recession, I know inancing was very, very hard for builders to obtain,” Lehner said. “Some analysts like to point out that demand increases much faster than supply can, given how long it takes to build housing.” New construction doesn’t necessarily equate to affordable housing. Much of the new construction is more expensive than existing housing, said Mike Wilkerson, senior economist with ECONorthwest. The median monthly rent in Portland is $1,200. In order to afford that, you’ll need to earn 113 percent of median income, Wilkerson said. If the unit was built after 2007, that price climbs to $1,750. Nearly 54 percent of Portland renters are paying at least 30 percent of their income toward rent, according to Lehner’s anal- ysis of census igures. Increased demand for construction work has driven up the bids contractors make on projects by up to 20 percent, Wilkerson said. The state labor commissioner’s rulings on prevailing wage also can drive up building costs, Creager said. One is example is the Yards at Union Station, a 1,200-unit development built in ive phases in downtown Portland. For the irst two phases, the Yards at Union Station developers were required to pay the residential wage to workers on the project. After Labor Commis- sioner Brad Avakian took ofice, he ruled the inal three stages — which were identical to the irst — demanded a commercial wage, because 20 percent of the development had commercial features. The other 80 percent of the project was residential. That decision drove up labor costs for the project by 25 percent, Creager said. A solution to help reign in those labor costs is to apply a split wage rate to such projects, he said. Local zoning laws limit where developers can build multifamily units, and there are few areas where building multifamily units is viable because of the high cost of installing infrastructure, Wilkerson said. Panelists recommended easing limits on density and prohibitions on duplexes, triplexes and garden-style apartments in single-family neighborhoods. Decreasing restrictions on construction of condos and prefabricated and modular homes also could help increase affordable housing capacity. Secondly, Wilkerson said, low-income housing credits need to be targeted geographically where the greatest need is, which is not happening now. Creager, of the Portland Housing Bureau said, even something as simple as including cost control into the charge of a city’s design review commission might help remove obstacles for developers. Last session, lawmakers passed legislation to end the state’s 17-year ban on requiring developers to include affordable housing in their plans, a measure to prohibit rent increases in the irst year of a month-to- month tenancy and increase notice for rent increases from 30 to 90 days, a pilot affordable housing program for smaller communities and a measure to allow annex- ations without going to the people for a vote. The Legislature also poured millions of dollars into emergency and home- less housing assistance, foreclosure counseling and other programs designed to keep people in their homes.