THE OWNERS of LV's Twelve-22 are struggling with a difficult fact: They're seen as one of Portland's last "black bars" in a neighborhood that's becoming whiter by the day.

The bar, at North Vancouver and Fremont, is at the center of what once was a neighborhood lined with African American businesses. LaVon Van, 45, grew up in the area and bought the bar in 2004, but it's become infamous for problems stemming both from gang violence and gentrification.

"This used to be a neighborhood bar, there was a sense of pride in coming in the door because it was the one place in Portland where you were not the minority," says Van. Since 2000, the neighborhood's black population has declined by over 40 percent. Meanwhile, the bar has been dogged by crime and a bad reputation.

"I can say my office is right across from Twelve-22 and everybody knows what I'm talking about," says Erik Luysterborghs, who runs Urbansphere realty across the street. "Then we start talking about the rumor."

"The rumor" is that the bar is dangerous and unwelcoming to white people. This nasty word-of-mouth is pervasive, but is summed up in a review written by a former staffer: "This is the one club in Portland that makes even the wiggiest of wiggers admit they're super white and just stay home... So go ahead. Be a middle-class tourist. Feel the thug life down into your chattering bones."

BarFly Creative Director Jen Lane allows that the review is due for an update. But that "wiggers stay home" sentiment, says bar manager Frewine Kiros, Van's fiancée, is what keeps new people—white people—away.

"People who have never been here repeat negative things they hear about it, that's embedded in racism and fear," says Kiros. "We're black owned, but we're open to all people. Pro-black is not anti-white."

As LV's business has struggled, the blocks around the bar have boomed. Across the street from LV's rises the new Albert Apartments, a market-rate project that replaced the vacant building once home to African American record shop House of Sound. The next block over is a giant pile of dirt that will soon be a New Seasons. New businesses only a few yards away, like vegan-friendly Brass Tacks sandwiches, have swiftly created a loyal clientele.

"It's weird. I feel like we should be welcoming people into our neighborhood. Instead, it feels like we're asking them to invite us into theirs," says Kiros. "I feel like we're the guests."

Not all of the bar's reputation is based purely on stigma. LV's is facing a $9,900 fine or license suspension from the Oregon Liquor Control Commission (OLCC) because of a history of criminal activity. The bar's troubled past mostly includes gang and drug issues—in 2009 and 2010, there were numerous gang fights in and around the bar. Police reports note that owner Van "wanted his bar to be a gang-free environment"—he gave cops permission to exclude known gang members, installed 16 security cameras, and hired private security. But problems continued.

The five arrests prompting the proposed license suspension shine a light on the bar's problems. The OLCC began keeping tabs on LV's in January, after a neighbor complained to the agency about people selling crack at the bar. That month, police arrested a 55-year-old transient a few blocks away who said he'd bought $9 worth of cocaine from a man named Bear near the door of the bar. A few weeks later, bar employees called the police, asking them to kick two women off the property. Police wound up arresting the women on suspicion of smoking crack behind the building. And a few days later, a cop watching the bar arrested two guys for allegedly smoking a joint in the parking lot. Bam! Five arrests in one month—a serious black mark on LV's OLCC record.

For now, LV's owners are hoping to keep their license and walk the complicated line of becoming a place where both black people and new white neighbors would want to buy a drink.

"We don't want to be seen as the sore spot of gentrification. We want to be part of the community," says Kiros.

"You have a German bar, you got an Irish pub. Why not have a Motown place?" adds Van.

Their neighbor Luysterborghs is rooting for the bar. He says he's seen the place clean up recently: "As the last man standing, there's an opportunity to create what this neighborhood really needs: a diverse bar."