Portland: Sam Adams and Taxes

By Dave Lister, The Eastside Guy
As featured in BrainstormNW magazine

It turns out my punditry was lousy. I was absolutely convinced that mayor Tom Potter, whose popularity remained at better than fifty percent despite his failure to bring forward most of his major initiatives, would walk into a second term. Even though most city hall observers agreed that he seemed less than enamored with his job, I was pretty sure he would enjoy four more years of doing battle with the federal authority and pursuing his goal of making Portland a sanctuary city for illegal aliens.

Whether it was the overwhelming rejection of his proposed “strong mayor” reform of Portland’s charter, former Chief Foxworth’s declared intent to sue the city on the basis of his sexual escapades with a subordinate being nothing out of the norm based on his predecessors, or the nagging undercurrent and innuendo of past improprieties that caused him to call it a day, I can’t say. But now that he has, the prospect of the 2008 elections being a shoe in for two entrenched, untouchable incumbents with the sideshow of a gaggle of smart-growthers forming up a rugby scrum for the open commission seat is leaving me gnashing my teeth.

Transportation Commissioner Adams, of course, is the mayor-apparent. After holding off until his only likely opponent, developer Bob Ball, committed political harakiri by spreading the story that Adams was having an inappropriate sexual relationship with an underage man, and then, when the story started to backfire, stated that he himself never really believed the rumors, Adams announced for mayor. In a spectacle resembling a Roman triumph, Adams supporters spilled into the street from his carefully chosen (and perfectly Portland) announcement venue, an organic brew pub.

Adams has never been shy about publicity and has done his best to stay in public view during his first term as commissioner. After being smacked down by his fellows on an early attempt to reform Portland’s onerous business tax, Adams regrouped and got council approval for a modified plan that left most of Portland’s business community smiling. He has since maintained a very high profile in a series of town hall presentations in which he has touted the need for additional taxes to deal with Portland’s street maintenance backlog, a backlog which he insists is growing at the rate of nine million a year. He’s kept his picture in the paper, his face on the television and his voice on the radio, even taking a regular grilling from Lars Larson.

“The most dangerous place to be in Portland is between Sam Adams and a microphone,” one local journalist recently joked to me.

Adams is now perfecting a proposal to ask Portlanders to increase their taxes in an effort to raise about 450 million for road repair and infrastructure improvements. He’s looking for a three cent per gallon local gas tax, and a street maintenance fee of about $4.50 per month to be tacked on to householder’s sewer bills. Businesses will likely be asked to pay a sliding scale maintenance fee, based on how many trips they generate.

Adams, of course, served as Portland mayor Vera Katz’s chief of staff for most of her twelve years in office. Considering that, it is remarkable that he was able to successfully campaign for a city council seat as a political outsider. Adams went out of his way to distance himself from Katz during his council run, but he may not be able to do so during his run for mayor. His transportation policies seem to mirror Katz’s anti-automobile agenda and his enthusiastic support of publicly funded development projects falls in lock step with Katz’s propensity for civic monuments, to wit, PGE park, the Esplanade, the Chinese gardens and the tram.

And in asking for additional taxes to solve the street maintenance backlog, Adams may run up against a very inconvenient truth, one in which he was undoubtedly complicit as the mayor’s chief of staff:

In 1988 the city council, under the leadership of Bud Clark, not only identified the pending maintenance backlog but also put in place a funding mechanism to address it; a mechanism which was ignored and overruled by the Katz administration.

The 1988 resolution identified the street maintenance backlog as being 476 miles requiring, at that time, 37 million to repair and repave. The ordinance called for a recommended allocation of 28% of the city’s utility franchise revenue stream to be dedicated to the problem.

If you don’t know, the city’s utility franchise fees are assessed to the power companies, the phone companies and the cable providers. The fee makes sense, in that these companies need to use the public right of way to provide their products and services to their customers. You might remember that Commissioner Leonard tried to include cellular services under the auspices of these fees a few years back, but the idea didn’t fly; he wasn’t able to successfully make the argument that the airwaves were a right of way requiring maintenance.

In any event, at the time of the council resolution, the city’s revenue from utility franchise fees was about 24 million. The 28% allocation made nearly seven million available for street maintenance. The total utility franchise revenue has grown dramatically over the years, hitting 36 million by 1996 and over 60 million in the last fiscal year. If the allocation had been adhered to it would be nearly 18 million, or about twice what Adams is seeking to raise in additional taxes.

As the revenue from the franchise fees grew, Clark’s council started to reallocate a portion of the 28% to other projects. Despite this, about 13 million went into street maintenance during his last four years in office.

Things changed rapidly when Vera Katz became mayor. Even though the franchise revenue hit 32 million during her first year in office, the allocation for street maintenance had been trimmed back to six percent. The next year, despite the fact the revenue continued to grow, her budget put the street maintenance allocation to zero. It has remained at zero ever since. In his quest for more transportation dollars, Adams has pretty much insisted that our shortage is due to the decreasing revenue from the state gasoline tax. I haven’t heard him discuss the inconvenient truth that the utility franchise revenue has tripled in twenty years but he has not advocated for renewing the transportation allocation.

Sam Adams wants to be our next mayor. I think it’s fair to ask him where all that money went and why we can’t return to the prudent budgeting that the council exhibited in 1988.

But what the heck do I know? I’m just an Eastside Guy.

By Dave Lister, The Eastside Guy
As featured in BrainstormNW magazine