They're pushing out the homeless.
They're using your tax dollars to stop protests downtown.
Since when does the Portland Business Alliance have more power than City Hall?
Two weeks ago, when council member Jim Francesconi announced at a public meeting he was voting against an antiwar resolution, his statement was greeted with boos and hisses from the crowd. Calmly, the second-term council member explained that city council should spend its time on local issues.
Largely a symbolic gesture, the proposed resolution was meant as an objection to any unilateral military action by the Bush administration in Iraq. But Francesconi concluded that the resolution would have no impact on federal policies. His "no" vote, corroborated by new council member Randy Leonard effectively killed the antiwar resolution.
The vote was surprising to everyone except perhaps Franklin "Kim" Kimbrough, the president of the Portland Business Alliance--a quietly powerful coalition of dozens of big-time downtown businesses from Powell's to PGE. For a week prior to the vote, Kimbrough and the Business Alliance's Board of Directors vigorously lobbied city council members to vote against the resolution. In a memo addressed to each of the council members obtained by the Mercury, Kimbrough tried to persuade city council not to even consider the antiwar resolution, calling it a waste of time and an action that "only helps to diminish the credibility of the Portland City Council."
Similar resolutions have been passed by city councils in San Francisco, Chicago and Detroit. Council member Erik Sten, who sponsored the ordinance, believes the Business Alliance's objection to the resolution was less about ideals and more about politics. "I think it was more a matter that [the Business Alliance] was trying to assert some control over city council," he explains.
At least once every three months, each member of city council meets individually and privately with the Board of Directors for the Business Alliance. This is an unprecedented amount of access to City Hall being given to a non-governmental group. If the memo from the Business Alliance opposing the antiwar resolution was strongly worded, says Sten, the squeeze by the Business Alliance in private, behind closed doors, was even more intense.
Hoping for a spirited public discussion weighing the pros and cons of the resolution, Sten says he tried to convince Kimbrough--or any members of the Business Alliance's board--to testify in council when the resolution was debated publicly. According to Sten, they responded, "'No way, we're not coming in there.'"
During three hours of public testimony, city council chambers were packed with supporters for the bill. About 50 people offered heartfelt and often well-reasoned speeches. Another 5000 residents expressed their support for the antiwar resolution by sending postcards and emails, making the resolution the most widely supported city council action in years. Only six people testified against the resolution.
Yet, when Francesconi voted, his words suspiciously echoed the memo from the Business Alliance. The newly elected council member, Leonard--whose campaign was heavily funded by the Business Alliance--also cast a "no" vote. Those votes sent the antiwar resolution down for defeat and made Portland the only city in the nation where such an ordinance has been considered, and defeated.
A BAD REPUTATION
The Portland Business Alliance may not be widely recognized by name, but their actions are well known and maligned by many in social service and activism circles. Housed in two separate offices, the organization that represents downtown businesses is as big as a mid-sized business itself. Its intentions are broad: According to its mission statement, it is "the primary advocate for the business community and [is] active in all aspects of public policy which could adversely effect [sic] that community."
Last spring, claiming that the homeless and street punks populating downtown were bad for business, the PBA drafted and lobbied for a sit-lie ordinance, a law allowing police to move along any person loitering on streets or sidewalks.
Over the course of several months, Mayor Katz sponsored roundtable discussions with representatives from both the Business Alliance and homeless advocacy groups like Sisters of the Road. Then, suddenly, in August, Mayor Katz swiftly enacted modifications to the city code--changes that reflected suggestions solely from the Business Alliance and rejected pleas from homeless advocates for compassion. Moreover, these changes to the city code were announced not in a public forum, but during a closed-door session; a meeting in which the mayor's office failed to invite representatives from the Sisters of the Road. Members of the Business Alliance, however, were in attendance.
But the Business Alliance is far more than just Portland's most prolific lobbying group. Under a contract with the city, the Business Alliance helps manage the city's Smart Parks and act as stewards for Pioneer Square. To further these ends, they hired the Portland Patrol who have been given power to issue "exclusions" to suspected drug dealers, alleged prostitutes, or anyone believed to be violating city rules. Under the exclusion ordinance, any person suspected of a crime may be kicked out of the downtown area for 90 days. Because these exclusions give the power of police, judge and jury to a single person, they have been routinely challenged in court as unconstitutional.
Civil rights attorneys also point out that these exclusions--especially as handed out by the Portland Patrol--unfairly target homeless and street performers, and that they quash free speech. Two years ago, a performance artist who painted himself head to toe in silver and stood motionless in Pioneer Square was repeatedly booted from the public space. The complaint? Soliciting money without a permit. Last May, two women who were trying to collect signatures for a medicinal marijuana ballot initiative were also ticketed and banished from Pioneer Square. (That case is currently pending in Federal Court.)
The Business Alliance has become so powerful that they are regarded as a de facto governmental agency. In December, without hesitation, a representative from the organization was guaranteed a seat on the board overseeing the newly formed Children's Initiative, the $50-million fund generated by a voter-approved ballot measure last November.
There are five seats on the board that oversees the tax revenue used to fund programs for local youth--one is assigned to a member of city council (Dan Saltzman). Another goes to a member of the Multnomah County board which, traditionally, has managed funding for youth services (Lisa Naito fills that seat). And oddly, one seat is reserved for a member of the Business Alliance. These three representatives will appoint children's advocates to fill the remaining seats.
This begs the question, "Why is a representative from an organization whose primary concern is invigorating downtown commerce, directing where and how $50 million in taxes are spent for local youth programs?"
In an interview shortly after the initiative passed, council member Saltzman, who was the driving force behind the ballot measure, succinctly explained the peculiar inclusion of the Business Alliance on the board. "They were big supporters," he said. Other backers included Nike, U.S. Bank, and Pizza Schmizza. None of those entities were guaranteed a seat on the board.
"SWEETHEART DEALS" AND BACKROOM POLITICS
The Business Alliance has two primary sources of income--they have the power to tax downtown businesses within a 212-block area; they also have a staggering $9 million contract with the city to manage the six Smart Parks and run a downtown marketing campaign.
Council member Sten calls the Smart Park and marketing contract a "sweetheart deal," which essentially subsidizes the Business Alliance. "Literally, the government is sponsoring an organization to use those funds to ban homeless people and stop the council from taking on a peace resolution," he says.
The Business Alliance also has the power to levy tax-like dues on property owners from SW Harrison to the Broadway Bridge. These taxes pay for pet projects, like stringing Christmas lights and helping finance the proposed $12 million ice skating rink, a project many political activists complain will take away the premier public space for demonstrations.
Explaining how the Business Alliance has the permission to tax downtown businesses, Sten refers to it as "a loaned governmental power."
Worried about repercussions from being quoted for this story, another anonymous city employee who works with accounting services went even further. "They are using the power of the city to levy money to turn over to a private entity." The ability to tax is a power reserved almost exclusively for governmental agencies; moreover, tax revenue is intended to be spent for the public good. Installing an ice skating rink to discourage Portland Peaceful Response and others from voicing their opinions downtown can hardly be considered "for the public good."
The employee also explained that as a private entity, the Business Alliance is immune to freedom of information requests or any other public scrutiny. (Although the Business Alliance has claimed their contract with the city has been routinely audited, the city has no knowledge of any audits.)
Downtown business organizations are not unique to Portland, nor are the Business Improvement Districts (BIDs) that allow such organizations to collect self-imposed taxes. Cities like Denver, San Diego and St. Louis have used similar self-taxation schemes to finance revitalization projects. But they are controversial--perhaps none more notorious than the creation of a BID in St. Louis. Before moving to Portland two years ago, Kimbrough served as the executive director for the Downtown St. Louis Partnership, an organization similar to Portland Business Alliance.
When Kimbrough left St. Louis, the revitalization of the riverfront downtown was gathering momentum, but after his departure that upswing quickly unraveled. Two separate groups of business owners filed lawsuits against the St. Louis Partnership, claiming the BID was illegally formed and the organization had overstepped its boundaries by levying a tax, effectively and illegally acting like a governmental agency.
The primary complaint against the St. Louis Partnership was that they railroaded businesses into joining the BID and that the requisite signature-gathering process sidestepped rules of fair play and ethics. (To qualify as a BID, more than half of the business owners in question must voluntarily agree to join and to be taxed. The BID in St. Louis narrowly cleared this margin, gathering a mere ten votes more than necessary.) An article in the Riverfront Times, a well respected weekly in St. Louis, reported one property owner as saying he made a deal with Kimbrough to exchange his signature to make a profit. "I wasn't really in favor of the [BID]," said Peter Dolan in the Riverfront Times' article. "But I made a deal with Kim Kimbrough that if he could get the St. Louis Community Foundation to lease my building, I would sign." The article goes on to explain that "Dolan did sign and the foundation did move into his building."
Allegations of other unscrupulous backroom dealings to assure that the BID would receive enough signatures also emerged after Kimbrough's departure. Pro-BID business owners whose stores straddled more than one lot were unfairly given the power to sign the petition more than once. Moreover, dozens of social service nonprofits, most of which opposed the BID, were excluded from the final tally of signatures. Without bending the rules as such, it is highly unlikely the St. Louis Partnership would have secured enough signatures to validate the BID.
A year after the BID formed in St. Louis, a group of business owners took the St. Louis Partnership to court. After the case dragged on for more than a year, though, the plaintiffs abandoned the case. These lawsuits have left the downtown business community deeply divided and splintered.
"It's not like [the PBA] is a bad structure that has no merit," Sten explains. Created during Neil Goldschmit's administration, the Business Alliance (then named the Association for Portland Progress) led the renaissance of downtown. For the 15 years prior to Kimbrough's arrival, the APP was headed by the well-liked Ruth Scott. Business owners and city politicians recall her as someone who was collaborative and worked with the homeless population downtown. Scott left APP two years ago and, say City Hall insiders, that "work-together spirit" disappeared as soon as Kimbrough arrived.
A few months after Kimbrough took his position as the Business Alliance's president, the APP merged with the near-bankrupt Chamber of Commerce to form the Portland Business Alliance. (Some interviewed claimed that the merger was more like "a buy-out" by the Business Alliance--a move to gain more civic power.)
The Business Alliance was unwilling to discuss why Kimbrough had been chosen two years ago to head the organization--or, for that matter, to answer any of our questions. After the Mercury left a phone message requesting an interview with Kimbrough, an unsigned email was sent to our office, simply stating: "The Portland Business Alliance declines the interview request made by Phil Busse."
Those familiar with Kimbrough, however, gave a consistent assessment of the Business Alliance president. Several city employees and business owners referred to him as "a bomb-thrower," "a thug in a business suit," and even "an asshole."
But some employees also place the blame for the overwhelming control the Business Alliance holds over city politics on City Council itself. The problem, explains Sten, is that City Hall has not set any boundaries for the Business Alliance and has allowed them to take unmitigated control.
"I think there's a reasonable case that the way the [Business Alliance] is acting now is like Frankenstein's monster," says Sten. "With that analogy, city council is Dr. Frankenstein."
He then recalls the end of the book, when the townsfolk ultimately banish the monster to an abandoned windmill to be burned to death. He smiles mischievously.
"Maybe that is a good analogy," he says. "The townspeople should be angry at this monster."