ON Wednesday, October 25, Portland City Council was expected to finally pass an ordinance that will require the Portland Development Commission (PDC) to spend 30 percent of its budget on affordable housing for impoverished people. The result will be a culmination of more than six months' worth of work, but it also leaves a number of questions still unanswered—primarily, who is now calling the shots on development in the city, and whose vision for the future will ultimately win out?
The common refrain throughout the halls of city government is "city council sets development policies, and the PDC implements those policies." In reality, though, PDC operates as a quasi-independent agency—the city gives PDC the bulk of its money through property taxes in urban renewal areas, but city council has no authority to tell the agency specifically what to spend its money on. Not surprisingly, this situation leads to an enormous amount of head butting between the two sides, evidenced most clearly by the 30 percent set-aside debate.
Historically, PDC's mission has been to foster economic development— like neighborhood renewals. Part of that mission is to increase property values (and tax revenues), but also to provide for affordable housing so that the city's core doesn't become an island of the economic elite. But without a clear policy from city council, the second part of that mission has often fallen through the cracks.
Take, for instance, the South Waterfront District. Money was specifically budgeted for affordable housing projects in the area, but as soon as costs of other elements began rising, affordable housing was the first item on the chopping block. PDC instead prioritized "capital projects"—high dollar/high profit developments meant to increase the tax base. By the time the agency finally gets around to spending money on affordable housing, property values will have risen so high that few units will be built.
That move infuriated City Commissioner Erik Sten—city council's resident advocate for affordable housing. So, in April, he began pushing for the 30 percent set-aside, which will place city council's goal of funding low-cost housing at the top of the priority list—and set it in stone.
After months of wrangling, PDC slowly came on board, but is still behind on one major element: The agency has still not provided guidelines for what income levels they'll be assisting. That has affordable housing advocates troubled—as the policy currently stands, PDC could focus all of its housing dollars on projects for people who make 80 percent of the median family income, neglecting those who make zero to 60 percent—the very people city council has pledged to help. PDC told Sten's office that they would come back within 45 days with a full set of income guidelines—PDC's Leah Greenwood now says they won't come back with those numbers until the end of the year.
But what if the agency continues to follow a policy that is at odds with the city?
"We've never had to test that, what happens if PDC doesn't follow our guidelines," Sten said during the council session. "I don't imagine we'll have to do that now."
But since state law prevents the city from exerting line-item control over the PDC's budget, does city council have the power to enforce its policies? Not without a change to the city charter—which would have to go before voters.
Sten threatened such a move last week, and he tentatively has the support of two other commissioners on a charter change. "My goal is to have a ballot measure on the May ballot," Sten told the Mercury. But there is another sentiment in other corners of city hall—leave the PDC as an independent body, so that when there are bad deals and screw-ups, elected officials have someone to point a finger at. Or as one city staffer recently said, "You don't want politicians in the business of making these tough development decisions—they won't take necessary risks" that the appointed PDC board can make.