Cops called on Old Town sneaker scam

Boy, the folks at the Oregon Justice Department sure are busy with Portland malfeasance these days. On top of their newly opened probe into the school district's dubious Procedeo contract, now we learn that they're also asking questions about that highly sketchy real estate deal called "Made in Old Town." We've written about this previously. In this particular spasm of wheeling and dealing, the state and city forked over $9 million of public funds so that a strange little nonprofit could buy vacant buildings in Portland Old Town at way more than their appraised value and then walk away from the properties, leaving the taxpayers holding the bag.

Supposedly they were going to design and manufacture shoes there. Ha! Ha! It was the most ridiculous thing you ever heard, and yet out flowed the millions of tax dollars.

Willamette Weed Week has been screaming about these transactions from way back before they were even entered into, and its account of the ongoing investigation sums up the gory details as follows:

The Oregon Department of Justice has subpoenaed records as part of an investigation into the failed startup Made in Old Town, which secured a $2 million grant from the state legislature in 2024 and then a $7 million loan from Prosper Portland in 2025 before going belly up earlier this year.

The existence of the subpoena, first reported by The Oregonian, means that Oregon Attorney General Dan Rayfield—and specifically the DOJ’s Charitable Activities Section—has turned its scrutiny toward the shoe manufacturing startup that promised a revitalization of Portland’s Old Town neighborhood. The subpoena, dated July 13, requests records specifically from the Old Town Community Association, the neighborhood association that served as fiscal sponsor of the project....

The Old Town Community Association was led by hotelier and political consultant Jessie Burke throughout the Made in Old Town saga. Burke is married to Jonathan Cohen, one of the primary principals of Made in Old Town. Cohen, during much of that time, was also treasurer of the community association.

Burke and Cohen have since left Portland for the East Coast, and left their leadership roles at the association. Burke and Cohen did not immediately respond to a request for comment from WW, including whether they had been contacted by the DOJ as part of the investigation.

Current community association board chair Elizabeth Nye did not respond to a request for comment.

Whatever happens with the DOJ investigation, somebody needs to do something about that board running the city's "redevelopment" agency, "Prosper Portland" (formerly the Portland Development Commission). They broke every rule in the book making a $7 million loan that anybody with a brain knew was never going to be repaid. The funds went to buy real estate at an inflated price from some sharpies in San Francisco. That money is now completely down the drain, and city taxpayers are left with real estate that is more a liability than an asset.

The mayor and city council could clear out the entire "Prosper" board tomorrow, and they should. But what they really ought to do is start winding down "Prosper" altogether. It's achieved little good in a long time, and its delusional "urban renewal" adventures are bleeding the taxpayers dry.

Getting back to the sneaker disaster, the best we can hope for is that the Made in Old Town deal was just gross incompetence, as opposed to active fraud and corruption. That's government these days, at all levels. Smile for the camera: When they write the history of the decline and fall of the Republic, we'll all be in it.