Word on The Street #1

Portland Business Alliance, Downtown Clean & Safe, Enhanced Service Districts, Auditor's Report & the Missing Audit Response

Dear Readers,

I was in the middle of writing last week's edition of The Agenda when Ashley Henry, former Executive Director of Business for a Better Portland (BBPDX), dropped her latest blog post, and I decided to share it with you instead. In it, she details her experience with the Portland Business Alliance (PBA) and her concerns about their entanglement with an affiliate partner, Downtown Portland Clean & Safe (Clean & Safe). Clean & Safe is the organization that oversees the Enhanced Service District (ESD) by the same name. Specifically, she raises the issue of whether ratepayer funds intended for the ESD are being used to subsidize PBA efforts that fall outside the scope of the ESD contract. She also shares how PBA threatening to sue her and BBPDX impacted her life.

“One of the reasons I decided to leave my job is that the Portland Business Alliance (PBA) threatened to sue both my employer and me personally because I spoke publicly about a massive public subsidy the PBA receives from the City of Portland.” —Ashley Henry

However, by the time I was nearly finished writing this, the prime time for sending out newsletters had passed, and since I wanted to make sure Street Wonk subscribers read this, I decided to wait until after the weekend to send it. Ultimately, I went down a PBA/ESD rabbit hole, requiring another couple of days to complete. I'll send out a combined issue of The Agenda covering last week and this week tomorrow.

So, welcome to the inaugural issue of a new section of Street Wonk—Word On The Street! This is where I’ll be covering timely and typically single topics that fall outside of The Agenda. Today’s focus: the Portland Business Alliance (PBA), Downtown Clean & Safe, and Portland’s problematic Enhanced Service Districts (ESD).

Thanks as always, for your support! Feel free to leave comments, questions, and suggestions for future issues.

A Better Portland is Possible!

Chloe

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Disclosure

I’m professionally and personally friendly with Ashley Henry, and I’m a fan of BBPDX. I cannot say the same about the Portland Business Alliance or anyone affiliated with them. I met with representatives of both organizations during my time on Council. I’m not, and have never been, a member of either organization.

What is the Portland Business Alliance (PBA)?

The Portland Business Alliance (PBA) is Greater Portland's Chamber of Commerce and is the largest business association in our region. “The Alliance advocates for business at all levels of government to support commerce, community health and the region’s overall prosperity. We also offer a variety of networking events and professional development opportunities to connect and foster growth in our region’s business community.”

That’s a nice way of saying they lobby for business interests, help place members on influential Boards and committees, and often oppose progressive candidates and measures. PBA also partners with affiliate organizations, including Downtown Portland Clean & Safe.

What is the Chamber of Commerce?

The U.S. Chamber of Commerce is the largest business association in the world and the largest lobbying group in the United States. Representing roughly 4000 local Chambers across the country, including the Portland Business Alliance, the U.S. Chamber of Commerce is a staunch advocate of free enterprise and is historically right-leaning and typically aligned with Republicans. However, current CEO Susan P. Clark, the first woman to hold that position in their 110-year history, spearheaded an effort to weaken that allegiance during the 2020 election cycle and promises to maintain a more bipartisan approach moving forward. 

Forgive me for suspecting this was more of a business decision than an ideological change of heart. I've watched PBA go through a similar transformation. In 2016, their legislative agenda, published on their website, was aggressively anti-progressive; now, it's couched in vague, feel-good generalities and currently only includes policy priorities. What they don't mention is the policy solutions they're advocating for and against, which is where they show their true colors.

What is Downtown Portland Clean & Safe (Clean & Safe)?

Downtown Portland Clean & Safe is the entity that runs downtown Portland's 213-block Enhanced Service District (ESD) and is an affiliate partner of the Portland Business Alliance. Clean & Safe is primarily known for its green-vested safety and cleaning crews. They also respond to non-emergency requests for service by downtown business owners, ranging from disorderly behavior, advice on security issues, cleaning up sidewalks, and assisting with graffiti removal. Their two biggest sub-contracts are Central City Concern, which provides trash removal and sidewalk clean-up services, and Portland Patrol, Inc., which provides private security officers. However, they also oversee the Downtown Services Program, which includes the Downtown Retail Development Program and the Downtown Economic Development Program, and conduct market research, marketing, communications, and lobbying, on behalf of downtown businesses. While PBA and Clean & Safe are separate legal entities, their staff and funding are intertwined.

You may remember Clean & Safe's controversial 2016 "Real Change" anti-homeless campaign. Real Change is a longstanding Clean & Safe campaign aimed at discouraging direct giving to people experiencing homelessness, presumably because it's a nuisance to downtown businesses, shoppers, and tourists. Instead, they encouraged charitable donations to nonprofits that serve them by portraying "panhandlers" as drug addicts. After a public backlash, including a nearly 1000-signature petition, the campaign quickly ended. 

Despite the decision to halt the campaign, then Chair of Clean & Safe, Mark Schlesinger, issued an explanation rather than an apology and doubled down on the messaging. According to Mr. Schlesinger, "Most homeless individuals do not panhandle, and our research found the ones that do frequently use the cash to support unhealthy habits." Adding, "Clean & Safe wants to make sure Portlanders are aware that the most effective way to help homeless individuals move off the street into safe housing and productive lives is not to hand them an occasional dollar or two but, rather, to encourage their engagement with one of the many nonprofits serving Portland."

Note: the most recent point-in-time count suggests less than 40% of individuals who meet the definition of chronically homeless have substance use disorders. This represents a small decrease since 2019. This is likely attributable to the number of homeless seniors, veterans, and people with disabilities, chronic health conditions, and/or mental illness increasing, because we know access addiction recovery services in Oregon is among the worst in the country. Mental health services are just as scarce. In fact, Oregon Health Authority is currently being sued by multiple Oregon health systems for failing to provide adequate mental health services to people experiencing severe mental illness.

What is an Enhanced Service District?

An Enhanced Service District (ESD), also known as a Business Improvement District, is established by a vote of area property owners who agree to pay a fee to supplement publicly-financed services such as cleaning and security. The scope of work may include other services such as market research, lobbying, and promotional campaigns. The fee is collected by the City and distributed to a nonprofit tasked with providing the agreed-upon services. 

Portland has three ESDs, Downtown Portland Clean & Safe, Lloyd ESD, and Central Eastside. The Central Eastside ESD includes a share of parking revenue. Since I was the transportation commissioner at the time, my office served as the liaison between the neighborhood and homeless advocates. We worked with PBOT staff and helped craft a much more transparent, functional, and just ESD. Although there's room for improvement in all three ESDs, Clean & Safe is the oldest, largest, and most problematic.

This is not just a Portland problem; there is growing opposition to Enhanced Service Districts and Business Improvement Districts across the country, due to a variety of issues. I’ve linked a number of articles and studies for further reading below, but to give you an idea of the range of concerns, here’s a non-comprehensive list:

• Privatization of public space

• Criminalization of homelessness

• Undue influence on politicians and policy making

• Inequitable public investments and allocation of public services

• Privileging property owners

• Lack of representation from renters

• Lack of representation from non-profits or community groups

• Lack of representation by communities negatively impacted by ESDs

• Poor representation of business community as a whole

Infographic from the August 2020 Auditor’s Report

What is Business for a Better Portland?

Business for a Better Portland (BPDX) is a progressive alternative to the Portland Business Alliance/Chamber of Commerce. Formed in 2017, their membership and supporters include business leaders, community members, and civic leaders. BBPDX advocates for policy solutions, programs, and funding that benefit our whole community, emphasizing racial, economic, housing, transportation, and climate justice.

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What did the Auditor’s Report say?

The Auditor's report—Enhanced Service Districts: City provides little oversight of privately funded services—was released in August 2020. It concluded that problems arise "when security, enforcement, and management of public spaces are decided by one paying sector of the community without the City's oversight and public input." The report recommended that the City "review the districts' purpose and the City's responsibility, revisit the district agreements," and "develop guidelines for district formation, governance, and management that ensures public input, transparency, and accountability."

How did the City of Portland Respond?

In response to the concerns raised by the Auditor's Report, the city established an ESD coordinator position which was filled in August 2021 when the Office of Management and Finance hired Shawn Campbell. Later that year, the City announced its three-stage audit response process—information, listening, and implementation—as well as an ESD projects timeline and opportunities for community engagement. Unfortunately, one year later, Mr. Campbell "was terminated after a series of disagreements with the CEO of PBA," according to Ashley Henry. It's important to note that the PBA endorsed every member of City Council, other than Commissioner Hardesty, including Commissioner Elect Gonzales. It’s fair to wonder what impact that had on his termination.

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PBA bullies business advocate and threatens their competition

The PBA threatening to sue progressive upstart BBPDX and then-Executive Director Ashley Henry is alarming and perplexing. Jessie Burke, local business owner and former PBA Board Member, shared similar concerns with Willamette Week nearly two years ago. Neither was making wild speculations but expressing concerns based on their reading of the Clean & Safe contract and the co-mingling of funds and staff. No one is disputing that ratepayer dollars are being used to cover a significant portion of PBA's administrative costs. 

Burke wanted to see more ratepayer dollars going toward the services that make downtown cleaner and safer, as Clean & Safe's administrative costs run higher than average. Andrew Hoan, executive director of PBA, countered that PBA's advocacy work benefits the Clean & Safe district, and it's what the ratepayers want. Henry's concerns are whether ratepayer money is subsidizing PBA staff salaries who are performing work outside the Clean & Safe ESD scope of work, which includes lobbying elected officials on issues far beyond the ESD and representing business interests who have no presence there. 

Even PBA and Clean & Safe leadership couldn't sort out the relationship and funding between the two separate but affiliated organizations. Perhaps as a result, in August 2021, the same month that Shawn Campbell was terminated, the Executive Director of Clean & Safe and Vice President of Downtown Services for PBA, Maureen Fisher, resigned. 

In 2020, Maureen Fisher told the Auditor she was "sorting through the web of relationships to untangle some of this." 

Despite the Auditor's report, the stalled audit response, concerns from former board members and staff, and community opposition to Clean & Safe, City Council renewed its five-year contract in September.

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Does PBA represent Portland’s Small Business Community?

PBA likes to tout the fact that the majority of their members are small business owners, implying that they're fighting for mom & pops and the little guy. While it's true that the majority of their members are small businesses, it's also true that they represent a small fraction of businesses operating in Portland. Considering around 95% of Portland businesses meet the definition of "small business," they'd be hard-pressed not to have a small business majority membership.

One challenge to clearing up the confusion around the term is that there is no common understanding of what a small business is. For example, what do you think of when you hear "small business"? How many employees does a small business have? How much revenue can a small business generate? The fact is, there is no single correct answer; small business size standards vary by industry. You often hear small business is the "backbone of our economy," and it's true that 98% of U.S. businesses have fewer than ten employees, which likely falls within the range of most people's definition. But would you be surprised to learn that, depending on the industry, companies with up to 1500 employees and up to $40M in revenue could still be considered small businesses? 

A more accurate reflection of who they represent emerges upon review of their Member Directory and the Committees and Boards overseeing PBA and Clean & Safe. When you think of small businesses, especially in downtown Portland, you probably think of street-level retail, restaurants, bars, cultural institutions, and other public accommodations. But a very different vision of Portland is presented when you look at the PBA's membership and the makeup of their Committees and Boards.

PBA Membership

Basic membership to PBA ranges from $100-$1185 annually. "Enhanced" membership ranges from $1750-$11,125 a year. And for $16,325.50, you can purchase a premium membership and a seat on the Board of Directors (pending Board approval). A review of their current Committee and Board members, as well as that of Clean & Safe, reveals a surprising lack of representation of small local businesses, especially retail and food establishments, as well as several top industries and major travel spending drivers. 

The largest job industries in Portland are apparel & outdoor, bioscience, climate tech, computers & electronics, design and media, food & beverage, metals & machinery, and software. The biggest drivers of travel spending are lodging, food and drinks, arts & culture, entertainment & sports, retail shopping, and local transportation. Take the Restaurant, Food & Drink industry. Portland has over 1000 restaurants, cafes, bars, and food carts and consistently rates among the top cities in the U.S.  for its food culture. It's both a top employment industry and a top driver of travel spending. While the restaurant and hospitality industries have lobbying organizations of their own, it's concerning that they have so little representation in PBA's membership, Committees, or Boards.

Why You Should Care

The PBA is to Portland's business community what neighborhood associations are to community members—a relatively small, non-representative group operating out of self-interest while claiming to represent the interests of the whole and wielding outsized influence in government. Their impact goes far beyond regional businesses and the local economy—they endorse and oppose candidates and measures and influence policies ranging from housing to transportation to taxation. Do I think they shouldn't exist? No. They have every right to exist. But there must be oversight, transparency, and accountability, as well as a viable alternative, with equal input and influence, to represent business owners who are not aligned with PBA's values and priorities, and do not support their policy positions.

Does PBA truly represent Portland’s business community?

The following is a breakdown of PBA member businesses by category and their representation on the PBA and Clean & Safe Committees and Boards currently listed on their website. Note: Some businesses appear in multiple categories, but I've chosen their primary industry. Also, I've deleted a couple of categories that weren't noteworthy or relevant to this discussion.

• Arts & Culture: 17 PBA members. Mostly nonprofits and arts institutions. One of Portland's top drivers of tourism and travel spending, as well as a defining aspect of Portland's identity and global reputation. Zero Exec Committee or Board representation.

• Athletic Shoes & Apparel: 2 PBA members. An iconic and top industry in Portland. One PBA Executive Committee member (Nike). One PBA Board member (Adidas).

• Banking & Finance: 147 PBA members. Including multiple branches of the same banking institutions. Four PBA Executive Committee members. Five PBA Board Members. One Clean & Safe Board member.

• Business & Professional Services: 49 PBA members. One PBA Executive Committee member. Twelve PBA Board members. One Clean & Safe Board member.

• Communications & Marketing: 20 PBA members. One PBA Executive Committee member. One PBA Board member.

• Community & Civic Organizations: 8 PBA members. Zero Exec Committee or Board representation.

• Construction Equipment, Material, and Contractors: 15 PBA members. One PBA Executive Committee Board member. Two PBA Board members.

• Education: 28 PBA members. One PBA board member from the Oregon Institute of Technology.

• Facilities & Maintenance: 34 PBA members. One PBA Executive Committee member. One PBA Board member.

• Government & Advocacy: 3 PBA members, including the Portland Police Association. One PBA Board member from the lobbying group Technology Association of Oregon.

• Healthcare: 4 PBA members. One PBA Executive Committee member. Four PBA Board members.

• Hospitality & Tourism: 2 PBA members. One Clean & Safe Executive Committee member. One Clean & Safe Board member.

• Insurance: 55 PBA members. Two PBA Executive Committee members. One Clean & Safe Executive Committee member. 

• Legal: 26 PBA members. Two PBA Executive Committee members. Two PBA Board members.

• Manufacturing, Production & Wholesale: Eight PBA members. This category includes two top industries in Portland: computers & electronics and metals & machinery. One PBA Executive Committee member (Coca-Cola).

• Media: 3 PBA members, including two McMenamin's theaters, which do not belong in this category whatsoever. Top industry. One PBA Executive Committee member. Four PBA Board Members.

• Nonprofit Organizations: 156 PBA members. Zero Exec Committee or Board representation. 

• Personal Services & Care: 20 PBA members. Zero Exec Committee or Board representation.

• Real Estate: 11 PBA members. Four PBA Executive Committee Board members. Four Clean & Safe Executive Committee members. Five Clean & Safe Board members. 

• Restaurants, Food & Drinks: 4 PBA members. Top industry and top tourist attraction. Zero Exec Committee or Board representation.

• Shopping & Retail: 180 PBA members, including 95 individual 7-Elevens and 14 Walmarts, leaving less than 75 unique retail businesses). A top driver of tourism and travel spending. Two PBA Executive Committee Members (Fubonn Shopping Center, Amazon). Two PBA Board members (Walmart, Chown Hardware). One Clean & Safe Board member (Mercantile).

• Sports & Recreation: 7 PBA members. A top driver of tourism and travel spending. One PBA Executive Committee member. (Trailblazers)

• Technology & Telecommunications: 3 PBA members. Climate tech, computers and electronics, and software are all top industries. Three PBA Board members from Google, AT&T, and Intel.

• Trade: 2 PBA members. One Clean & Safe Executive Committee member.

• Transportation & Logistics: 36 PBA members. Zero Exec Committee or Board representation. This category includes cabs, TNCs, and public transportation, among others. Because transportation policy has an enormous impact on residents, workers, and visitors, as well as carbon emissions, and PBA has a history of lobbying against transportation projects that would improve pedestrian and bike safety, bus service, and carbon emissions, I find this concerning. 

• Utilities & Energy: 24 PBA members, including 12 Chevron gas stations. Two PBA Executive Committee members. One PBA Board member. Zero Committee or Board representation from the legitimately green and renewable energy industry.

In addition to how Portland's top employment industries and tourism drivers are represented, now consider the types of businesses, organizations, and institutions essential to average Portlanders, the needs they serve, and the issues they face doing business in Portland. What do they need to thrive? Are their interests well represented and served by the banking & finance, business & professional services, or real estate industries that dominate these boards and committees?

Do Google, Nike, Walmart, Amazon, and Coca-Cola understand or care about our local communities enough to be given such an outsized voice with our elected officials? Who does the PBA seat on City boards and committees that help influence policy decisions? And if a seat on the Board requires $16K+ and Board approval, how could their representation be remotely adequate?

Here are just a few things that PBA has opposed, officially and unofficially over the past six years: Measure 97: Oregon Business Tax Increase, City of Portland tenant protections, Portland Clean Energy Fund, Measure 26-218: Infrastructure and Transportation Payroll Tax, and Measure 26-228, Changes to City Governance and Ranked-Choice Voting. Do these positions reflect Portland's business community or monied corporate interests? Are they what's best for the people of Portland and the planet we live on or are they solely driven by the bottom line?

Calls to Action!

Write to City Council: If you're concerned about the seemingly abandoned audit response process, the failure of City Council to respond to the concerns raised by the audit, and their decision to renew this problematic contract with Downtown Portland Clean & Safe, please write them! Contact info here.

Support BBPDX: Better Business for Portland has two membership levels. Business (fees based on number of employees, they also provide one-year free membership for qualifying businesses through their Civic Access Program) and Affiliate (for nonprofits and public sector organizations). If you don't own a business, you can donate to Friends of BBPDX—"a nonprofit organization supporting the educational work of Business for a Better Portland."

Wonk Out!

Audit Report & Response

• Read: Audit investigation demanded by Enhanced Service Districts (Portland Tribune, 2022)

• Read: Audit Finds City-Approved Business Districts Rely on Unregulated Policing (Portland Mercury, 2020)

• Read: New City Audit Highlights Lack of Oversight of Three Private Security and Cleanup Teams (Willamette Week, 2020)

• Read: Audit Response Overview (City of Portland, last updated April 26, 2022)

• Read: City of Portland’s Enhanced Service District Liaison Departs (Willamette Week, 2022)

• Read: Auditor too cozy with anti-business activists (Portland Tribune, 2022). I have to share my favorite quote from PBA, an organization that has poured millions into influencing elections, ballot measures, and policymaking regarding Western Regional Advocacy Project (WRAP) who they also referred to as “…extreme political lobbying organizations with national affiliations.”:

“We are shocked to learn that a San Francisco-based dark money lobbying organization and its local partners were able to pass official city business by effectively co-writing an audit that was presented to the city council and to the public as the independent work of the auditor." —Portland Business Alliance 

Despite PBA’s histrionics, WRAP is a very much aboveboard coalition of grassroots non-profits dedicated to housing security, accessible healthcare, and ending homelessness. Their member organizations and national allies—which take one click to discover from their homepage— include seven community organizations, including two in Portland, and five well-respected national organizations, including the Poor Peoples Campaign, a movement originally launched by Martin Luther King, Jr. In case you want to donate to any of these “extreme political lobbying organizations” here they are:

• Coalition on Homelessness (San Francisco)

• Housekeys Action Network (Denver)

• Los Angeles Community Action Network (Los Angeles)

• Right 2 Survive (Portland)

• Sacramento Homeless Organizing Committee (Sacramento)

• Sisters Of The Road (Portland)

• St. Mary’s Center (Oakland)

• National Alliance of HUD Tenants (Jamaic Plain, MA)

• National Association for the Education of Homeless Children and Youth (Tucker, GA)

• National Health Care for the Homeless Council (Nashville)

• National Law Center on Homelessness & Poverty (Washington, DC)

• Poor Peoples Campaign (Washington, DC)

Issues with PBA & Clean & Safe

• Read: Clean & Safe, PBA exec quietly resigns, raising further questions about influence (Street Roots)

• Read: A Controversial Private Cleaning and Security Nonprofit Is Supposed to Make Downtown Sparkle. But Where Is the Money Really Going? (Willamette Week)

• Read: Q&A: Small Business Advocate Ashley Henry on How City Money Goes Into the Pockets of the PBA (Portland Mercury)

• Read: Full Circle: The “Follow the Money” Edition by Ashley Henry (Medium)

Clean & Safe Contract Renewal

• Read: Portland tables decision on Clean & Safe contract renewal (KOIN)

• Read: City Council Approves New Contract with Clean & Safe, Despite Public Opposition (Portland Mercury)

Clean & Safe Opposition

• Read: End Clean & Safe (blog)

• Read: Western Regional Advocacy Project (blog)

National Media & Academic Study on Business Improvement Districts

• “Business Improvement Districts” Quietly Privatize the Policing of Public Space (Truthout)

• Business Improvement Districts Allow for Aggressive Policing of the Unhoused (Teen Vogue)

• BIDs Destroy Our Community (Western Regional Advocacy Project)

• Fifty years of Business Improvement Districts: A reappraisal of the dominant perspectives and debates (Urban Studies Journal)