Council votes to raise blue bag price, bar fee
Tax rebate tabled, likely dead; schools cut $500K
By Chris Busby
An often tense and divided Portland City Council passed the combined city and school department budget last night, a roughly $255 million spending plan that will raise property taxes 2.1 percent.
Just prior to the council’s meeting, the school board met and unanimously approved the $500,000 reduction to its budget suggested by the council’s Finance Committee last week. The full council approved that reduction – which brings school spending just under $82 million – with no debate.
That was not the case when the council considered a controversial tax rebate program. That program, an extension of the state’s so-called Circuit Breaker property tax rebate program, would have required the city to collect an additional $1 million in revenue to give homeowners and renters a check equal to 25 percent of the rebate they receive from the state’s program.
Several councilors objected to the idea of funding the program with property tax revenue. Some suggested the $1 million could be raised by increasing fees for city services. The program is being referred back to the Finance Committee, with the stated expectation that it will come back to the council when a different funding source is found.
Committee chair Nick Mavodones was not optimistic that will happen. “I’m not sure it’s coming back,” he said.
After extensive debate, the council also voted to raise the cost of city trash bags from $4.75 per pack to $7.50. An effort to reduce that price hike to $6.50 failed by one vote.
And the council voted to more than triple a special fee required of bars operating in the Old Port, an action likely to trigger a lawsuit from bar owners in the district who consider the fee an unfair tax.
Councilors also voted to give themselves a raise.
Tax rebate tabled
In early March, City Councilor Jim Cloutier sounded confident the Finance Committee he serves on would be able to fund a city Circuit Breaker-style program from sources other than property tax revenue. He suggested the $1 million necessary to pay for the program could come from parking fees and fines, rent from city-owned properties or the surplus fund of the budget.
But ultimately, it seems the committee was unable to find a viable, alternate funding source, and so proposed to pay for the program with general revenues – basically property taxes and fees.
Now the council has sent the program back to the committee with a directive to do what it had been unable or unwilling to do before: find the money elsewhere.
City Councilor Will Gorham suggested the city could raise fees to cover the program’s $1 million cost. This idea seemed attractive to some councilors who support the program if it does not require a property tax increase to fund it.
But Councilor Cheryl Leeman, a vocal opponent of the program, asked, “How could $1 million in fees be feasible and $1 million in property taxes not?”
Cloutier, one of its chief proponents, said it makes no sense to differentiate between tax and fee revenue, all of which goes into the same general fund. He was likewise pessimistic a $1 million fee increase would be feasible.
The city faced a strong possibility the program, if enacted, would be challenged in court. A similar program the council adopted in 2003 was successfully challenged, largely based on the fact it raised all property owners’ taxes in order to provide rebate checks to a select group (homeowners, in this case, of certain financial means).
Some councilors expressed hope the program could one day be funded through a local tax on meals and lodging. But a so-called local-option tax would need state legislative approval, and state lawmakers have long rejected efforts by cities to get that approval.
“A local-option tax is not coming anytime soon,” said Councilor Karen Geraghty, a lobbyist in Augusta by day.
Geraghty joined Cloutier, Mavodones and Councilor Jill Duson is an unsuccessful effort to keep the program before the council. Gorham, Leeman, councilors Ed Suslovic and Donna Carr, and Mayor Jim Cohen all supported the motion to send it back to the Finance Committee, which may reconsider it by the end of the month.
Trash bag hike
The debate over a proposal to increase the cost of city trash bags was also divisive.
Leeman charged that the city was breaking a “promise” made to citizens years ago, a pledge that the city would not use bag revenue to cover the cost of trash pickup and services – only for the recycling program introduced at the time.
Revenue from the price hike, which goes into effect July 1, will cover the cost of expanding recycling and trash pickup services to roughly 8,000 residents of condominium developments and large apartment buildings. The city is also expanding its hazardous waste drop-off program, dropping “punch pass” fees for city dump runs, and buying new trucks for its recycling operations.
Leeman argued, unsuccessfully, that these costs should be covered the same way other basic city services are paid for: through general fund revenues (taxes and fees). No other councilor recalled the “promise” Leeman mentioned.
Mayor Cohen put forward an amendment to raise the price a dollar less (to $6.50 for 10 15-gallon bags or five 30-gallon bags). Leeman, Gorham and Carr supported this, but the other five councilors defeated the mayor’s amendment.
When the new recycling program takes effect later this year, residents will no longer have to separate recyclables in their blue bins. It’s hoped this will increase the city’s residential recycling rate from about 35 percent to 50 percent. Prior to the program’s introduction years ago, Portlanders recycled only about 7 percent of their trash.
Leeman, who referred to herself as “the queen of recycling,” called the idea the new program is intended to boost recycling “the biggest bunch of bunk I’ve ever heard in my life.”
Bar fee tripled
Old Port bar owners will undoubtedly be using slightly stronger language this week as they consider the 300-percent-plus fee hike they now face every year.
The fee applies only to bars that need a special Old Port Overlay License, a license required if an establishment makes more than half its revenue through alcohol sales. Twenty-four bars currently hold these licenses (the maximum allowed since the council cut the number of Overlay Licenses from 27 earlier this year).
The fee is assessed based on a bar’s legal occupancy. It is being raised from $4.50 per unit of occupancy (or “seat”) to $15 per seat. (In discussions prior to last night’s vote, some councilors had said that figure would actually be $13.25 per seat, but the measure approved last night was for $15).
The increased fee revenue – totaling $60,000 – is intended to cover the cost of increased police coverage in the district on weekend nights during the summer.
Some councilors favored waiting until the recently formed Old Port Task Force recommends ways to address the cost of public safety. At least one councilor supported the increase with reluctance.
“I don’t like this,” said Duson. “It sucks.” She pointed that the bar owners “already pay taxes,” and said the council should concentrate on closing bars that cause problems, instead. However, Duson added that she was loathe to “unbungle the budget” by taking the fee hike revenue out of the spending plan.
When Cohen again suggested a smaller increase, calling the fee hike “too far, too fast,” and proposing a $9 per-seat fee, Duson inadvertently supported the amendment, joined by Geraghty, Leeman, Gorham, Carr and Cohen.
Wearied by the late hour (it was past 11 p.m.), Duson said before the next item was read that she had “voted in error,” and when her colleagues granted a request to reconsider the vote, she opposed Cohen’s amendment and joined Cloutier, Mavodones, Suslovic and Geraghty in passing the full increase. (Carr and Gorham also voted for the $15 hike after the mayor’s amendment failed, leaving only Leeman and Cohen in opposition.)
Councilors vote themselves a raise
Among the last items the council considered before adjourning was a proposal to give non-union city personnel a three-percent raise. That group includes City Manager Joe Gray and his two assistant city managers, City Clerk Linda Cohen, city attorney Gary Wood and the councilors themselves.
Gorham proposed exempting councilors from the raise, but no councilor seconded his motion, so it failed before it was considered. The three-percent, $153 raise will bring each councilor’s annual compensation to $5,253.
Councilors also approved the hiring of five more police officers. Police Chief Tim Burton said the additional cops will be integrated into a department-wide reorganization intended to strengthen community policing efforts.
And the city will fund two new studies, albeit at levels well below their originally proposed cost. One will examine the needs and history of Somali and Sudanese refugees in Portland. The other will study the recent surge in drug-related crime. Each will get $5,000, down from a combined $45,000.
