ORDINANCE No. 176776

*Amend requirements regarding district property management license (Ordinance: amend City Code Chapter 6.06)

The City of Portland ordains:

Section 1. The Council finds:

1.  In 1988, the City established the Downtown Economic Improvement District. The District funded supplemental downtown cleaning, security, business development, and marketing services.

2.  In 1994, the City established the Downtown business property management license fee applicable within the Downtown Business District (known as the Downtown Clean and Safe District) and discontinued the Downtown Economic Improvement District. The District has funded supplemental downtown cleaning, security, crime prevention, business development, public policy, housing, and marketing and communications services, the need for which is generated by and which benefits the users of downtown properties.

3.  Portland Downtown Services, Inc. (PDSI) is an Oregon non-profit 501(c)(3) corporation formed by Downtown Business District license fee payers who are representative of a large number of property owners and managers in the District, including persons potentially responsible for the major portion of the revenues generated from the District. PDSI manages the District services under the Agreement for Downtown Clean and Safe District Management Services between the City and PDSI (City Contract No. 51730)

4.  PDSI has proposed amendments to City Code Chapter 6.06 that will increase the District license fee; dedicate the revenues from the increase to the design, acquisition, construction, installation, operation, and maintenance of a seasonal and decorative lighting system within portions of the District and of a skating rink in Pioneer Courthouse Square; and provide an enhanced ability to incur debt to finance these programs.

5.  The overall fee and formula, as proposed to be amended, will continue to yield a fair representation of the relative need for supplemental services loads that uses of downtown property create, and will continue to be the best fee and formula that can be developed taking into consideration fairness and availability of existing public databases.

6.  It was established, in City of Portland v. Atwood, 13 OTR 136 (1994), that the property management license fee as established in 1994 is not subject to the limits of Section 11b, Article XI of the Oregon Constitution. It is the determination of the Council that the property management license fee as amended by this ordinance continues to be not subject to the limits of section 11b and is not subject to the limits of section 11, Article XI of the Oregon Constitution. The Council therefore classifies the license fee, as amended, as not subject to those limits.

NOW, THEREFORE, the Council directs:

a.  City Code Section 6.06.200 A. is amended by replacing existing subsection 7 with new subsections 7 and 8 as follows:

7. With the total of the amounts determined under Subsections A.1. through 6. being multiplied by the CPI-W adjustment factor, for license fee years commencing on or after October 1, 2001.

7. Plus $.02 (cents) per square foot of improvements and, for surface parking lots, per square foot of land square footage, as of the July 1 immediately preceding commencement of the license fee year;

8. With the total of the amounts determined under Subsections A.1. through 7. being multiplied by the CPI-W factor, for license fee years commencing on or after October 1, 2001.

b.  City Code Chapter 6.06 is amended by adding new Section 6.06.216 to read:

6.06.216 Lighting and Rink Revenues and Program.

A. As used in this Chapter, “lighting and rink revenues” means that portion of Downtown Business District revenues collected under Section 6.06.200 A.7 as adjusted each year under Section 6.06.200 A.8.

B. As used in this Chapter, “lighting and rink program” means the design, acquisition, construction, installation, operation, and maintenance of all components, including but not limited to electrical connections and decorative lighting fixtures, necessary for a seasonal and decorative lighting system within portions of the District and for a skating rink in Pioneer Courthouse Square.

C. Notwithstanding Section 6.06.010, lighting and rink revenues shall be used only:

1. For the lighting and rink program, including but not limited to the pledging of such revenue as provided under Section 6.06.215;

2. For a proportionate share of the Bureau’s costs of administration of the license fee directed by the City Council to be recovered from license fee revenues, based on the ratio of lighting and rink revenues to total District revenues; or

3. If a qualified contractor determines that lighting and rink revenues in a license year will exceed or have exceeded the costs and expenses of the lighting and rink program in that license year and that the excess revenues will not be needed to fund a prudent reserve or for the costs and expenses of the lighting and rink program in future license years, then for distribution by the qualified contractor to the payers of the lighting and rink revenues of that portion of the excess determined by the qualified contractor not to be so needed, in proportion to the amount paid by each payer in the license year that produced the excess.

c.  City Code Section 6.06.215 A is amended to read:

A. In addition to the uses of District revenues set out in Section 6.06.010, the City, if so requested by a qualified contractor and approved by the City Council, may pledge Downtown Business District license fee revenues as security for City debt incurred to finance the design, acquisition, construction, and installation of improvements within the District and may pledge Downtown Business District license fee revenues to a qualified contractor or its designee in order that the contractor or designee may have revenues sufficiently ensured to enable the contractor or designee to incur debt to finance the design, acquisition, construction, installation, operation, and maintenance of improvements within the District. Any such pledge of Downtown Business District license fee revenues shall be subject to any limitations set out in Oregon law or in the City Charter. In addition, no City pledge or combination of pledges under this Section for City payment of actual debt service or to enable the qualified contractor or its designee to make payments of actual debt service, but not including pledges to provide excess coverage for City payment of actual debt service or to enable the qualified contractor or its designee to provide excess coverage for payments of actual debt service, at any time shall exceed one-third of the Downtown Business District license fee revenues.

d.  Notwithstanding the amendment to City Code Section 6.06.200 A. by this Ordinance, the City of Portland, for the license year beginning October 1, 2002 and ending September 30, 2003, shall be exempt from the obligation to pay the amount of license fee provided for in Section 6.06.200 A.7. In any subsequent years, the City Council may exempt the City of Portland from the obligation to pay the amount of license fee provided for in Section 6.06.200 A.7.upon a determination by the Council of the existence of a fiscal emergency for the city or its participating properties.

Section 2. In order for the increase established by this ordinance to be implemented during the license fee year commencing October 1, 2002, it is necessary that the notices of license fee due include the amount of fee determined under City Code Section 6.06.200, as amended by this ordinance. The notices are to be sent out on or before August 1, 2002. Therefore, in order that the notices may include the amount of fee determined under City Code Section 6.06.200, as amended by this ordinance, an emergency is declared to exist and this ordinance shall be in full force and effect from and after its adoption by the Council.

Mayor Vera Katz

BEW:pd

July 15, 2002

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BACKING SHEET INFORMATION

AGENDA NO. 913-2002

ORDINANCE/RESOLUTION/COUNCIL DOCUMENT NO. 176776