A BRIEF HISTORY OF BUSINESS IMPROVEMENT DISTRICTS IN PORTLAND
(excerpts from Caitlin Burke’s “An Examination of Portland’s BIDs: Their History and Approach” Thesis PSU 2008 with additions from Sandra Comstock )
In 1988, Portland’s downtown businesses lobbied successfully for the creation of a downtown Business Improvement District then called an Economic Improvement District, or EID. It’s purported goals were “to remove signs of physical decay, encourage prosecution of low level crimes, and criminalize nuisance activities.” To this end, on March 9, 1988, the City implemented Ordinance No. 160561, which was based on the Economic Improvement District Plan. The plan outlined the procedures and requirements to establish an EID. The ordinance itself established a working group to examine the feasibility of such a district. Several months later the City Council agreed formally to establish an Economic Improvement District by unanimous vote on June 29th, 1988 through Resolution No. 1609951. The businesses involved petitioned for an EID with mandatory funding, by submitting the Preliminary Economic Improvement Plan to City Hall. However, they ended up with a voluntary assessment mechanism, approved by the city in Ordinance 164665.
MAKING THE BID FEES MANDATORY
By 1993, one year before the next renewal of the EID, the EID Advisory Committee directed APP staff to change the initial EID and find ways to ensure a mandatory source of revenue to support the Downtown Clean & Safe. The businesses involved in the district argued that, after reviewing “all sources of municipal revenue authority under the Oregon Constitution and the Portland Charter”, they had decided that the current EID should become a Business Improvement District (BID). The BID would be financed by a business license fee, administered by the city and based on the approximate ‘load’ or need for private services that a given property placed on the district. This would be calculated by property value, square footage and passenger elevators.
In 1994,the businesses involved in the district lobbied City Hall, with the support of sixty-seven percent of businesses, to institute a BID funded by a business license fee on downtown property management (APP “A Work”). City Hall agreed with their argument for a BID that downtown was a unique area that attracted a concentrated number of people, especially disadvantaged individuals, and needed Downtown Clean and Safe’s supplemental services to maintain downtown as a “vital economic, cultural and citizenship center of the City and the region” (Establish Business). It also agreed that a business management license fee was necessary. So, on March 30, 1994, the City Council passed Ordinance 167514, which allowed businesses involved in the district to manage a BID through a business license fee (Amend City Code; Establish Business). They obtained an ordinance that allowed them to manage a BID – now, the BID had to be found constitutional in a tax court in order for City Hall to legally approve of their petition.
The city petitioned the Oregon Tax Court to obtain a ruling on the constitutionality of the BID and the tax court found the BID constitutional. In 1996, the City made the transition from EID to BID complete by implementing a Property Management License Fund that provided a process for the BID to receive monies from the city.
When the BID came up for renewal in 1997, APP, Central City Concern, Portland Police Bureau and seventy percent of businesses in the BID district petitioned City Hall to vote yes on the renewal, with modifications to ensure sufficient funding “for supplemental services in the district…consisting generally of security, cleaning…” (Petition for Adoption; Amend Downtown). Along with the petition, businesses involved in the district wrote a draft of the desired amendments to the city code (Amend Downtown).
Among other things the businesses involved in the district wanted the ability to tax managers of downtown rental and owner occupied properties (i.e. most condos), to prevent them from benefiting from the private services provided by the BID without paying for them (Doern). The City agreed to renew the BID with the fee increase and the new assessment of rental properties, but without the assessment on owner occupied properties “to allow time for further consideration of whether management of owner occupied dwellings should be subject to the license fee” (Amend Downtown). The City declared that single room occupancy properties, low income, and subsidized housing remained exempted for public policy reasons. On July 2nd, 2007, City Hall passed Ordinance No. 171365 that amended the city code (Amend Downtown).
AN INCREASED ROLE FOR PRIVATE SECURITY
A big part of those funds were directed toward restructuring the role, scope, and size of the private security force in the downtown area. Changes implemented drew strongly on a 1994 APP survey of downtown businesses in which most of the respondents worried downtown appeared unsafe to consumers, employees, etc. The survey and report that accompanied it came up a number of suggested solutions.
First, private patrol officers’ presence on the street should be increased. Second, more private patrol officers should patrol at night to “address public safety concerns”. Third, a panhandling team should be created to address “panhandling, aggressive panhandling, as well as dealing with the public through APP’s panhandler information and voucher program.” Fourth, one Portland Guides’ evening shift should be replaced by patrol officers. In addition to increasing the officers’ hours on the street, private patrol officers’ authority should be enhanced through a closer relationship with the Police and Parks bureaus. The close relationship between the patrol officers and the police, which would include similar uniforms, carrying guns, and a direct radio link, would increase the ‘police presence’ on the street and therefore deter individuals from committing crimes.
While the business community has largely lauded the benefits of private patrol officers, most studies have shown that private patrol officers are far less effective than police in reducing crime (Ozawa 283). Even more problematically, when private security does act, there is no public oversight of their actions – unlike the police bureau, which is more effective and is publicly overseen. Finally, Downtown Clean and Safe Patrolling borrows from the “Broken Windows Theory” of crime abatement — which is that keeping downtown visibly clean and patrolled will create a perception of safety and order that discourages crime and disorder in reality. Sadly, much of this activity amount to stopping our neighbors experiencing houselessness from carrying out life-sustaining activities such as sleeping, resting, and accessing basic services to meet their hygiene needs. Moreover, we have found that these patrols and the cleaning crews frequently call upon the city to clear people from life-sustaining shelters and often confiscate other types of critical survival gear that endangers live . For these reasons, many criticize this model as a ‘harassment model of policing and ‘cleaning’ that does lots of harm to achieve minimal and fleeting benefits (Worrall 74; ACLU; Selbin). Indeed, study upon study have show that policing and patrols are a very expensive and minimally and ephemerally effective way to improve safety (Branas, et. al. 2016; Harcourt, 2001; Browning et. al, 2010). Far more effective for improving whole community safety are funds put toward encouraging all members of the public to be in and use space actively in ways that improves passive surveillance. This includes establishing safe encampment sites for those who have nowhere else to rest their heads (ACLU; Schmid; Lynnes).
INCREASING REVENUE BASE AND AUTHORITY
In 2001, businesses involved in the district lobbied to renew the BID again and sent a draft of proposed amendments to City Hall. They argued that the BID should renew every ten years instead of every three years in order to have fewer “expensive” reviews. They declared that all residential properties should be assessed and owner occupied dwellings should be encouraged to pledge money to the BID. Mass shelters, property owned by religious organizations, and owner occupied dwellings would still be exempt from mandatory funding for public policy reasons. They also requested some modifications of the fee system to increase the fees. Finally, they wanted the BID to geographically expand and increase the number of properties being assessed. The City approved all the proposed amendments in Resolution 175729.
In the amended city code of 2001, the activities of the BID were expanded to allow the BID to manage supplemental services that address crime prevention (instead of just security), transportation (instead of improvements to parking system and parking enforcement), public policy, housing, marketing and communication, and a lighting program (all new) (Amend City). In order to increase the BID’s range of supplemental services, businesses involved in the district lobbied City Hall, and in most cases was successful at raising more funds for the BID.
Since then the Portland Business Alliance (PBA is APP’s successor) has manifested that it hopes to acquire more revenue sources, by assessing owner occupied dwellings and expanding the BID to include more city blocks. After an unsuccessful attempt by APP to include owner occupied units in the BID’s assessment system, PBA is planning to lobby City Hall again for the same purpose. This would boost the PBA budget and would address the free rider status of owner occupied dwellings. As well, PBA wants to expand the BID’s boundary, as far as 14th street, to assess new development in that area.
ACLU, Decriminalizing Homelessness, Why Right to Rest Legislation is the High Road for Oregon. 2017.
Bernard Harcourt Illusion of Order: The False Promise of Broken Windows Policing (Cambridge, MA: Harvard University Press, 2001).
Charles Branas, Michelle Kondo, Sean Murphy, Eugenia South, Daniel Polsky, and John MacDonald, “Urban Blight Remediation as a Cost-beneficial Solution to Firearm Violence,” American Journal of Public Health 106, no.12 (2016): 2158-64
Burke, Caitlin “An Examination of Portland’s BID: Their History and Approach” Thesis PSU 2008.
Christopher Browning, Danielle Wallace, Seth Feinberg, and Kathleen Cagney, “Neighborhood Social Processes, Physical Conditions, and Disaster-Related Mortality: The Case of the 1995 Chicago Heat Wave,” American Sociological Review 71 no.4 (2006) 661-78.
Lynes, Abby 05/29/2018 “Want neighborhood crime to come down? A sanctioned homeless camp could be the secret” The Oregonian.
Ozawa, Connie. ed. The Portland Edge: Challenges and Successes in Growing Communities. Washington, D.C.: Island Press, 2004
Schmid, Thacher 05/23/2018 Homeless Villages Crime No link between homeless villages and crime rates, Guardian review suggests. The Guardian.
Selbin, Jeffrey et. al, 2018 “Homeless Exclusion Districts: How California Business Improvement Districts Use Policy Advocacy and Policing Practices to Exclude Homeless People from Public Space UC Berkeley Public Law Research Paper.
Oregon/Portland Ordinances, Laws, and Court Cases
City of Portland v. Atwood, 13 OTR 136 (1994)
Direct the Portland Police Bureau to delay enforcement of Portland City Code Section 14A.50.030 Sidewalk Obstructions until 25 benches are installed, the shower in the Julia West facility is open and operational, the showers and lockers under RFP are open and operational and the 24 hour bathroom is open and operational are available for displaced persons under 14A.50.030 of 2007. Portland City Hall Resolution Resolution No. 36514
Property Management License Fund of 1 July 1996. City Hall Code. Title 5, Revenue and Finance, 5.04.480
Economic Improvement Districts (EID) of 1985. Oregon State Legislature Code. O.R. 2443
Purpose. City Hall Code. Title 3, Chapter 3.21, Code 3.21.010
Repeal and Replace Code Regarding Sidewalk Use (Ordinance; repeal and replace Code Section 14A.50.030)
of 2004. Portland City Hall Ordinance Ordinance No. 178958
State v. Kurylowicz No. 03-07-50223 (Or. Cir. Ct. 2004).
State v. Robinson No 0309 52392 (OR Ct. of Appeals 2005)
Establish Business Property Management License Fee for Downtown Business District of 1994. Portland City Ordinance Ordinance No. 167514
Establish the Street Access for Everyone workgroup to assess citywide problems associated with street disorder and sidewalk nuisances and recommend strategies for problem-solving (Resolution) of 2006. Portland City Hall Resolution Resolution No. 36413
Property Management License Fund of 1 July 1996. City Hall Code. Title 5, Revenue and Finance, 5.04.480
Repeal and Replace Code Regarding Sidewalk Use (Ordinance; repeal and replace Code Section 14A.50.030) of 2004. Portland City Hall Ordinance Ordinance No. 178958
The city petitioned the Oregon Tax Court, as provided by ORS 305.589, for a judicial declaration concerning the effect of section 11b, Article XI (Measure 5) on the license fee (Establish Business). In the case, City of Portland v. Atwood, the business management license fee was found within the limits of Article XI. The case stated that the fee, which required the person responsible for paying water utility charges for property or the person with right of occupancy to pay fee did not violate Measure 5 because the fee was not imposed on a property or upon a property owner as direct consequence of property ownership (City of Portland v. Atwood).
The city passed Resolution No. 170223, which created the Property Management License Fund. Under this fund, any revenues derived from assessments levied under the former downtown Economic Improvement District and all revenues generated by the Downtown Property Management License program would used by APP to manage Downtown Clean and Safe’s supplemental services and for any costs of the City’s administration of the Downtown Property Management License Fund (Property Management License Fund)