Street Fee: Novick Willing to Weigh Low-Income Discount for Businesses, Too

• denis c. theriault
• Activist Joe Walsh, before yesterday’s hearing on the street fee: “Et tu, Novick!”

With flashbacks from yesterday’s tense, six-hour hearing on a citywide road safety and maintenance fee still dancing through his head (he was reading our live blog when I phoned him), Commissioner Steve Novick this afternoon still managed to speak candidly on the state of his proposal—after a busy 24 hours of amendments, overhauls, and major pushback from his colleagues.

Novick unsurprisingly confirmed his commitment to a city council vote on one part of that plan next week—a fee for residences—even if it turns out he and Mayor Charlie Hales somehow don’t have the votes to push it through. He mentioned a return to peace between himself and Commissioner Nick Fish after Fish raised serious questions about procedure and substance late last night, a conflict that briefly spilled into an email exchange this morning.

But, perhaps most importantly, Novick said his office is interested in exploring deeper changes to the nonresidential fee he’s promised to put forward by mid-November. If his staff can make it work, they’ll consider a discount for struggling businesses—based on revenues—similar to the discount he’s already suggested for low-income families. Current estimates would see some businesses on the hook for thousands of dollars a year.

Novick stressed that the idea is extremely tentative and may not be feasible without being worked out further (among the issues? how the discount would affect overall revenues). But he nonetheless sketched out one possibility: Businesses whose revenues fall under a certain threshold would pay a flat fee instead of a fee based on their type and size.

“Can we get away with it, and still have it be a fee, having a small business version of a low-income discount,” he asks.

That kind of change could go a long way toward easing the ire of business owners, many of whom showed up at last night’s hearing and have been flooding city hall inboxes with emails warning about having to hang up their shingles for good. Business outcry was strong enough that Novick and Hales announced, hours before the hearing yesterday, that they’d take a few more months to work out kinks in the fees facing businesses and other nonresidential outlets.

Novick, however, also said he’s still slightly skeptical.

“The way to charge businesses based on sales is to have a sales tax,” he says. “If you really want the revenues generated by businesses to be based on sales, you should have a sales tax.”

The détènte with Fish, meanwhile, came after last night’s issues briefly carried over into an email back-and-forth this morning.

Willamette Week and the Tribune posted a list of 11 questions that Fish had emailed out to his colleagues and their chiefs of staff this morning. Atop that list was a question about how to provide relief for low-income Portlanders. The council last night adopted an amendment that would phase in the residential fee over three years, starting at $6, and then $9, before rising to $12—with proportional two-thirds discounts for low-income residents. But that didn’t assuage concerns from Fish or advocates at yesterday’s meetings.

Novick fired back a pithy reply to Fish’s questions:

Commissioner – Last week I learned that fewer than 10,000 Portlanders receive a low-income discount on their water and sewer bills. My understanding is that there is no mechanism for that discount to be applied to multifamily structures, where I presume most section 8 voucher holders reside. If all low income Portlanders received a 30% discount on their sewer bills. It would more than make up for the cost of paying the much smaller transportation fee. I suggest that we assemble a task force to address the question of how to limit the burden of both water and sewer bills and the transportation fee on low income Portlanders. I also suggest that if we are to have a sunset clause for this fee, we should impose the same sunset on water and sewer fees. And if we are to have an administrative cap, the same cap should apply to BES and Water. Thank you.

But then the two commissioners actually sat down and spoke—and reached something of an agreement. It won’t be a “task force” as Novick initially suggested in his email, but Novick says the two commissioners “have an agreement that we will start figuring out how to collectively alleviate the impact of utility fees on low income Portlanders.” Fish is commissioner of the water and environmental services bureaus.

Novick said only 10,000 residents take advantage of a sewer and water discounts worth $120 every three months. He said some residents might be better off each month, even if they started paying the street fee, simply by applying for and receiving the other discount.

Fish says he was already starting that conversation in his bureaus, along with a shift to monthly billing.

“Over the next year,” he says, “that’s a positive thing he and I can work on.”

Novick also acknowledged the compressed timeline looming over the fee proposal—something driven largely by political concerns. Paul Romain, the lobbyist for the Oregon Petroleum Association, promised last night that his group would refer a fee to the ballot if the council doesn’t do it first. By voting on the residential fee next week, Novick and Hales can guarantee that the issue heads before voters in November, which means higher turnout.

“If somebody refers the residential side,” Novick says, “then the biggest possible electorate gets to vote on it.”

That election also would see a separate measure backed by Hales that would bind the city, through its charter, on how it can spend the fee revenue. And while higher turnout might help, other circumstances might hurt.

Splitting off the nonresidential fee, even with a promise to pass both fees by November 14 or scrap the whole idea, undercuts a selling point uncovered in polling: People felt better about things when they knew businesses also would pay something. That message isn’t as easy to sell under the new arrangement.

And then there’s the November 14 deadline and why that was chosen. Novick said it might sound he and his staff had purposely looked for something after Election Day. That wasn’t the case. He wanted to set the deadline for a nonresidential fee earlier, until he was reminded about his honeymoon that fall.

“We didn’t even think about that,” he said.