Portland's $7 Million Shoe Factory Boondoggle Collapses After Executive Flees

Another Public Investment, Another Vanishing Act

When Portland's economic development agency Prosper Portland handed over $7 million in public money to an athletic shoe manufacturing incubator called Made in Old Town in early 2025, city officials were sold on a vision: a thriving nine-building campus filled with local shoe designers and manufacturers that would revitalize the struggling Old Town neighborhood.

One year later, that vision is dead. The project's executive director has disappeared without explanation, the promised private funding never materialized, and taxpayers are left holding the bag on a loan that may never be repaid.

A February 19 letter from Prosper Portland director Cornell Wesley to project trustee Greg Bui reveals the moment city officials finally lost patience with the failing venture. The letter, obtained by Willamette Week, shows that executive director Liz Rodgers' sudden resignation was the breaking point for an agency that had watched the project stumble for months.

"We Did Not Receive Formal Notification"

"It has come to our attention that Liz Rodgers, the project's executive director, has abruptly resigned from her role," Wesley wrote. "We did not receive formal notification when this occurred, and we do not know the date she resigned."

Let that sink in. The person running a $7 million publicly funded project walked away without bothering to tell the lender. That is not how responsible stewards of public money operate. That is how grifters operate.

Wesley's letter makes clear that Rodgers' departure was not just a personnel issue but a fundamental threat to the project's viability. "Occurring while the project is already facing significant challenges, creates a high degree of insecurity for us as lender," he wrote, adding that the agency "cannot effectively evaluate the project's path forward without understanding the stability of its leadership."

The letter demanded answers: Why did Rodgers resign? How would the project find new leadership? And most importantly, how did Made in Old Town plan to resolve the fact that it was already in "material default" on the loan for failing to raise the private funds it had promised?

Made in Old Town never responded in writing to any of those questions, according to Prosper spokesman Shawn Uhlman.

A Pattern of Broken Promises

The $7 million loan allowed Made in Old Town's principals to purchase two buildings in Old Town with the promise of eventually expanding into a nine-building manufacturing campus. But even before Rodgers' resignation, the project was showing signs of trouble.

The venture had committed to raising private matching funds by a June 30 deadline. That deadline came and went with no money materialized. By the time Wesley sent his letter in February, the project was already in default.

Wesley's letter references "active engagement" between Prosper Portland staff and the Made in Old Town team both before and after the missed deadline. Translation: city officials had been watching this train wreck in slow motion for months, offering the project multiple chances to make good on its commitments.

"Please come prepared to demonstrate how you intend to resolve the current default," Wesley wrote ahead of a scheduled meeting he described as a "critical juncture."

Apparently, Made in Old Town was not prepared to demonstrate anything. Two days before Wesley's letter, Willamette Week reported Rodgers' resignation. Neither she nor Made in Old Town responded to requests for comment then or now.

Who Pays When Public Investments Fail?

Prosper Portland has remained deliberately vague about what happens next. Wesley said in February that repossessing the buildings was "on the table," but the agency has not committed to any specific course of action.

When asked whether Prosper expects Made in Old Town to repay the full $7 million, spokesman Uhlman offered a carefully worded non-answer: "Any decision to accept less than full payment can only be made by our board. Until such a decision is made, our expectations for repayment are as set forth in the loan documents."

That statement does everything except answer the question. It suggests that Prosper Portland's board has the authority to forgive some or all of the debt, which means taxpayers could end up eating the loss on this failed venture.

This is a familiar pattern in economic development deals: public agencies take risks with taxpayer money that private investors would never touch, promising job creation and neighborhood revitalization. When those projects fail, the people who approved the deals face no consequences, the principals behind the failed projects move on to their next scheme, and the public is left to absorb the losses.

Accountability Starts With Transparency

Prosper Portland needs to answer some basic questions. Who conducted due diligence on Made in Old Town before approving a $7 million loan? What red flags were missed or ignored? Were there conflicts of interest among the decision-makers? And what safeguards existed to prevent an executive director from simply walking away from a publicly funded project without notice?

The agency also needs to explain its next steps in clear, unambiguous terms. Will it repossess the buildings? Will it pursue legal action to recover the loan? Or will the board quietly forgive the debt and hope nobody notices?

Portland taxpayers deserve answers. They deserve to know how their money was spent, who approved spending it, and what will be done to recover it. They deserve accountability for a process that allowed $7 million in public funds to disappear into a failed shoe factory with no consequences for anyone involved.

Economic development agencies exist to take calculated risks that can benefit communities. But there is a difference between calculated risk and reckless spending. When a project's executive director can resign without notice, when promised private funds never materialize, when deadlines pass with no accountability, that is not economic development. That is a failure of oversight that borders on negligence.

Prosper Portland's board meets in public. Portlanders should show up and demand answers.