Portland approves Moda Center funds, but Trail Blazers lease battle looms

The Portland City Council approved $120 million in funding to renovate the Moda Center and attempt to keep the Trail Blazers in the city.

The council voted 8-4 Wednesday to pass a non-binding term sheet, though it also included an amendment that would require the Blazers to pay about $3.1 million in rent annually.

The city’s approval was the final step in a monthslong process to line up financing for the arena, but it does not guarantee that the Blazers will stay. The vote instead launches a 4 1/2-month negotiation with the team on a new lease agreement.

The Blazers and the city of Portland have found little common ground so far in their negotiations, but a deadline now looms for both parties. Government officials at the state, county and local levels have voted to approve more than $573 million to refurbish and modernize the Moda Center, but there must be an agreement on a term sheet by Dec. 31 for the team to access the $365 million appropriated by the Oregon state legislature. The city council will likely vote on the lease on Dec. 17, its final scheduled meeting of the year.

The team’s Moda Center lease expires on Oct. 11, 2030, and the two sides are trying to agree on a new 20-year deal. The franchise and local government have publicly disagreed about how much the Blazers should contribute financially, along with other terms of the current bridge lease. New Blazers owner Tom Dundon has said he believes the team should not have to contribute to the renovation funds. Last month, Blazers president Dewayne Hankins said the city was is not a palatable business environment for the team.

The Blazers have also asked the city to remove a clause that requires the team to maintain the Moda Center “in a first-class manner.” Team executives say that leaves the Blazers open to lawsuits.

City officials have disputed that interpretation and have so for declined to take out a clause that was already negotiated in a signed lease. Deputy city administrator Donnie Oliveira also said the bridge agreement, signed in 2024, prevents the city from suing the Blazers during the course of the current lease.

“We again reiterate our position in this proposal that the information (Rip City Management) provides regarding any future renovation will not be used against (the Blazers) and the city has no intention of using the current Bridge Agreement in that manner,” Oliveira wrote in a July 28 email to Hankins. Oliveira’s message quoted, in bold and underlined text, the following language from the lease: “Landlord agrees not to raise, assert, pursue, or otherwise enforce in any manner the ‘first-class’ obligations of Tenant hereunder.”

For weeks, there was uncertainty about whether city and county officials would approve the funds to renovate the arena. Not only had the relationship between the city and team grown testy, but local politicians also began to voice skepticism about devoting taxpayer money to the renovation plan.

The Moda Center is the oldest NBA arena that hasn’t been renovated. Since the city bought the arena for $1 from the Paul Allen estate in 2024, the team and the city have been splitting the maintenance bills, which range from $8 million to $10 million a year.

Last week, the Multnomah County Board of Commissioners approved a term sheet that would offer up to $101.6 million to upgrade the arena. The city council voted Wednesday to finance its contribution.

Now the negotiations begin.