The BulleTin • Sunday, March 13, 2022 A3
LOCAL, STATE & REGION
CONCORDIA PORTLAND
Legal issues could snag UO’s purchase of campus
The University
of Oregon board
of trustees will
meet Monday
to consider
the Concordia
property
purchase.
Oregon has
offered $60.5
million.
BY JEFF MANNING
The Oregonian
The University of Oregon’s pur-
chase of the former Concordia Uni-
versity campus in Portland to host an
ambitious youth behavioral health in-
stitute seems the proverbial win-win.
The deal solidifies UO’s relationship
with a pair of mega-wealthy support-
ers — Connie and Steve Ballmer, who
have contributed $425 million toward
the center — and establishes a new
Portland campus. The city of Port-
land gets a big economic development
win. Even the site’s northeast Portland
neighbors are thrilled the land will
remain part of a university after Con-
cordia shut down in 2020.
More broadly, if the Ballmer Insti-
tute for Children’s Behavioral Health
accomplishes its far-reaching goals,
troubled young people all over the
planet could benefit.
The most surprising winner of all
may well be Concordia’s parent orga-
nization — the Lutheran Church-Mis-
souri Synod. The conservative church
that threatened to withhold financial
support for Concordia Portland in
part because it was too supportive of
gay, lesbian, trans, queer and nonbi-
nary students could enjoy an unex-
pected $70 million windfall.
The University of Oregon board of
trustees will meet Monday to consider
the Concordia property purchase. Or-
egon has offered $60.5 million.
Matthew Harrison, president of the
St. Louis-based synod, said publicly in
2018 that shutting down Concordia in
Portland could blow a “$400 million
crater” in the church’s finances.
So far, it hasn’t turned out that way.
If the UO purchase goes through as
planned, the proceeds from the real
estate sales will cover the $37 million
the Lutheran Church Extension Fund
had loaned to Concordia and put
many millions more into the into the
extension fund’s treasury.
But there are two wildcards compli-
cating the purchase.
Concordia’s long-time technology
In this Oct. 10, 2016,
photo, students
study on the former
campus of Concor-
dia University in
Portland. The Uni-
versity of Oregon’s
plans to buy the
campus and turn it
into a youth behav-
ioral health institute
needs to clear sev-
eral legal hurdles.
Oregonian file photo
partner — a Bay Area firm called
HotChalk Inc. — has sued the college
and its parent church in an attempt
to collect $300 million it claims it is
owed.
On Feb. 7, 2020, two days before
Concordia publicly announced it was
shutting down, the school transferred
ownership of the campus to the exten-
sion fund.
HotChalk protested that it was
an insider deal that amounted to a
“fraudulent transfer.” In hopes of pro-
tecting its claim against Concordia,
HotChalk has filed what’s known as a
lis pendens on the campus property.
A lis pendens is a legal notice filed
with the county recorder’s office es-
sentially warning prospective buyers
that the property has become em-
broiled in a legal dispute. The result-
ing “encumbrance” on the property is
generally sufficient to scare off poten-
tial buyers.
There is another impediment to
closing the sale from a most unlikely
player in the drama — the Lutheran
Church Missouri Synod.
The synod has its own publicly re-
corded legal right that allows it, in the
words of UO officials, “to take title
to the (campus) property should the
property be used for a purpose other
than as a religious or educational in-
stitution affiliated with the Lutheran
Church.”
The UO’s tentative purchase agree-
ment requires the extension fund to
“reach agreement with the Missouri
Synod to extinguish that right of reen-
try. Should for any reason LCEF fail in
doing so, the University will not pur-
chase the property.”
Many players in the Concordia
drama consider the extension fund as
subordinate to the synod and believed
that the two entities were on the same
page. In its own mission statement,
the fund states its primary purpose “is
to support the Lutheran Church-Mis-
souri Synod.”
But the current situation challenges
that view.
David Foraker, a Portland attor-
ney representing the extension fund,
said there is no deal currently for the
synod to give up its right of reentry.
“They’re reluctant to engage with us,”
Foraker said. “There have been no ne-
gotiations.”
The extension fund is a significant
operation. It has $2.1 billion in assets
and invests money on behalf of the
synod and its members. It also loans
money to individual church work-
ers and affiliated colleges and other
schools.
“There’s this myth that the synod is
the parent and puppet master,” For-
aker said. “That’s not true. They don’t
have the same management, and they
have different boards of directors.”
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