Approve sale of housing.

Byline: The Register-Guard

The Oregon University System's staff report adds up to a persuasive case for the sale of the Westmoreland student housing complex in west Eugene. But when the state Board of Higher Education meets this week to consider giving its approval, the strongest point in favor of the sale has little to do with the details of a real estate transaction. The board should give its assent because the UO has been told to manage its financial affairs in an independent, businesslike fashion, and that's what it is doing.

With or without a sale, Westmoreland has reached a turning point. The 404-unit complex, built between 1960 and 1964, is a deteriorating asset. If the UO were to retain it as part of the university's inventory of student housing, the units would soon need to be remodeled and upgraded. The expense of this work would result in rent increases and drain funds from other UO housing projects.

For decades, Westmoreland has provided low-rent housing to a distinct group of students - many of them older, many with children, and many from other countries. Many current and former residents could not have attended the UO without the affordable rents and community support they found at Westmoreland, and this history has created a broad constituency against a sale.

But Westmoreland can't be the same place in the 21st century that it was in the last half of the 20th. Currently, only 187 units are occupied, and only 31 families living in the complex have children. Last fall, of the 39 children enrolled at the complex's child care center, only seven were Westmoreland residents. Students are seeking housing that is more modern or closer to campus - indeed, other UO student housing projects have the capacity to absorb any who choose to move as a result of a sale of Westmoreland.

The UO first offered the property for sale to public entities, as required by law, but found no takers. Then, subject to state approval, it accepted an offer of $18.45 million from Eugene broker Michael O'Connell Sr. A sale to O'Connell would serve the interests of renters better than a sale to a public agency. O'Connell plans to make the investments necessary to preserve Westmoreland as housing, whereas a public purchase would probably have resulted in the complex being demolished to make way for other uses. The UO promises to mitigate the transition to private ownership in a variety of ways, and O'Connell intends to keep rents low.

While relieving the UO of the need to find a way to arrest Westmoreland's slide, a sale also provides an infusion of unencumbered capital. With the proceeds from the Westmoreland sale, the UO can pay off its share of debt incurred to finance student housing at other Oregon universities. That will allow the UO to invest in its own housing stock, remodeling aging dormitories or building new student housing complexes. Money from the sale can also be used to buy property near campus that will be of far greater long-term value to the university than the Westmoreland parcel in west Eugene.

Westmoreland has been an important part of students' lives for generations. No one will celebrate closing that chapter in the life of the university. But the UO's ability to provide financial assistance of any kind is limited - and as the chancellor's staff report notes, students have received the benefit of Westmoreland housing without a means test, and many residents are not students. Both the UO, through its fund-raising efforts, and the state, through its grant programs, are moving in the direction of targeting financial assistance more precisely.

The UO and President Dave Frohnmayer have made a difficult but sound decision. The state board, which along with the Legislature has asked all Oregon universities to be businesslike in the management of their finances, should not stand in the way when one of them takes that direction seriously.