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191562

Ordinance

Authorize agreement with Lloyd B.I.D., Inc. for Lloyd District Property Management Services for an estimated amount of $3,550,000 over five years

Passed

The City of Portland ordains:

Section 1. The Council finds:

  1. Pursuant to Chapter 6.06 of the City Code, the City has established a property management license fee within the Lloyd Business District, also called the “Lloyd District” or the “District.”  The purpose of the license fee is to provide revenues to fund supplemental transportation management, District Attorney prosecution, and economic development services within the District. A companion ordinance is before the City Council on December 13, 2023, to meet the sunset review requirements in City Code 6.06.280 and extend the Lloyd District for an additional ten (10) years.
  1. Lloyd B.I.D., Inc. (“Lloyd BID”) is a non-profit organization representing a large number of property owners and managers in the District. Lloyd BID initiated the establishment of the license fee.  Lloyd BID also represents the property managers who will be responsible for paying most of the license fee revenues, and it is uniquely qualified to manage the provision of District services.  Lloyd BID is a “qualified contractor” as that term is defined in PCC 6.06.020.N. 
  1. Lloyd BID currently provides District property management services pursuant to City Contract No. 30006726, authorized by Council through Ordinance no. 189330 on January 2, 2018.  The current agreement between Lloyd BID and the City expires January 31, 2024. 
  1. The services provided by the District, throughout the term of the agreement, are part of a unique and coordinated personal services program that Lloyd BID has developed and provided, and there is no other potential qualified provider of the services with the experience, expertise, and capability of Lloyd BID.  It is therefore appropriate for the City to enter into an agreement with Lloyd BID for performance of these services, and Lloyd BID is willing to contract to provide the services.
  1. In accordance with City Code 5.33.120.C, a Sole Source Procurement Notice was published on November 16, 2023 and remained posted for a minimum of seven (7) business days.  No comments or protests were received.  The City may award a sole source contract in accordance with City Code Chapter 5.33.
  1. The expenditure to Lloyd BID for the net license fees collected is budgeted at $669,000 in FY 24-25. These disbursements are always equal to the net of license fees revenue collected within the District less the Revenue Division’s administrative fee and City overhead costs. 
  1. Both the City and Lloyd BID recognize the desire for greater accountability, transparency and regular reporting on district activities and the proposed management agreement, attached to this Ordinance as Exhibit A, includes new reporting and oversight mechanisms like those included in other recent enhanced services district renewals.
  1. Lloyd BID is committing to work with the City on addressing future recommendations that may come from ongoing efforts to respond to the 2020 City Auditor’s Report on the City’s Enhanced Services Districts program.

NOW, THEREFORE, the Council directs:

  1. The Chief Administrative Officer, or designee, is authorized to execute an agreement with Lloyd BID Inc. to manage and provide certain Lloyd District property management services, in substantially the form attached to this Ordinance as Exhibit A, and upon City Attorney approval as to form.

An ordinance when passed by the Council shall be signed by the Auditor. It shall be carefully filed and preserved in the custody of the Auditor (City Charter Chapter 2 Article 1 Section 2-122)

Passed by Council

Auditor of the City of Portland
Simone Rede

Impact Statement

Purpose of Proposed Legislation and Background Information

Pursuant to Chapter 6.06 of the City Code, the City has established a property management license fee within the Lloyd Enhanced Services District, also called the “Lloyd District,” “Lloyd ESD,” or the, “District.” The purpose of the license fee is to provide revenues to fund supplemental transportation management and assistance, community engagement and resource sharing, neighborhood promotion, right-of-way landscaping projects, and temporary assistance to those experiencing houselessness in the Lloyd district.

This ordinance approves the new 5-year agreement with Lloyd BID for ESD management services. A companion ordinance is before the City Council on December 13, 2023, to meet the sunset review requirements in City Code 6.06.280 and extend the Lloyd District for an additional ten (10) years.

Lloyd B.I.D., Inc. (“Lloyd BID”) is a non-profit organization representing a large number of property owners and managers in the District. Lloyd BID initiated the establishment of the license fee. Lloyd BID also represents the property managers who will be responsible for paying most of the license fee revenues, and it is uniquely qualified to manage the provision of District services. Lloyd BID is a “qualified contractor” as defined in PCC 6.06.020.N.

In the absence of any other qualified non-profit who could fulfill the work of the Lloyd ESD, in accordance with City Code 5.33.120.C, a Sole Source Procurement Notice was published on November 16, 2023, and remained posted for a minimum of seven (7) business days. No comments or protests were received. The City may award a sole source contract in accordance with City Code Chapter 5.33

Financial and Budgetary Impacts

The amendments proposed via the companion ordinance to City Code 6.06.260 change the property management fee structure, originally based on property tax assessments in 2010-2011, and adjusts to inflation rates over the past ten years, yielding a more robust projected operating revenue for the Lloyd BID, which plans to add right-of-way cleaning to the bevy of work they currently provide on behalf of the Lloyd ESD.

This change will increase the projected operating revenue for the Lloyd BID to continue existing work while adding in new right-of-way cleaning work, further contributing to the vibrancy of the District.

This ordinance gradually increases the license fee paid by district property owners. This increases the resources available to the ESD Board to spend on procuring additional services within the district. The City charges administrative fees to collect and distribute these fees. These fees total between 3 and 4% of the total revenue collected and cover the Revenue Division’s costs to collect and distribute fees, a variable fee associated with the costs of the City’s ITS system replacement and a portion of the cost of the ESD Coordinator position housed within the Office of the CAO at OMF. These details are described in the new 5-year contract scheduled to be approved at the same City Council meeting by separate companion ordinance.

Community Impacts and Community Involvement

Providing additional services for this district contributes to the attractiveness and vitality of the Lloyd ESD, enhancing the vibrancy for all who live, work, or visit the Lloyd district. Furthermore, these services increase the district’s resiliency and aids in the attraction and retentions of businesses, residents, and visitors from near and far. Home to the Moda Center and the Oregon State Convention Center, a vibrant and attractive Lloyd district is imperative due to this district’s ability to attract conferences, exhibitions, and sports fans from all over. A vital Lloyd district increases tourism and business revenue, which increases city tax revenue that supports the General Fund and other public services.

The Lloyd ESD conducted extensive outreach to district ratepayers to assess the value of their services and build support for district renewal, with gradual rate increases reflected in the proposed PCC amendments. With the support of the Lloyd ESD Board and ratepayers, the district will be continuing past services while expanding their cleaning services within the district and hiring a part-time administrator. District renewal and service expansion received strong support from district ratepayers.

The City mailed a postcard and letter about the renewal process on November 17th. The mailer included a link to a survey and provided information on how to submit comments, attend a virtual open house on November 28, or participate in the City Council hearing on December 13.

100% Renewable Goal

Not applicable. 

Budget Office Financial Impact Analysis

The second ordinance approves the new five-year agreement with Lloyd Business Improvement District (BID) for Enhanced Services District (ESD) management services, while the first legislation is a companion ordinance to meet the sunset review requirements in City Code 6.06.280 and extend the Lloyd District for an additional ten (10) years.  

The amendments proposed via the companion ordinance to City Code 6.06.260 change the property management fee structure, originally based on property tax assessments in 2010-2011, and adjusts to inflation rates over the past ten years, yielding a more robust projected operating revenue for the Lloyd BID, which plans to add right-of-way cleaning to the bevy of work they currently provide on behalf of the Lloyd ESD. This change will increase the projected operating revenue for the Lloyd BID to continue existing work while adding in new right-of-way cleaning work, further contributing to the vibrancy of the District. 

The fee established for management of business and residential property in the Lloyd District for a license year will be the sum of the following: 

1.   The $0.40 (cents) per $1,000 of assessed value of improvements for the 2010-2011 property tax assessment year will be increased to $0.45 (cents) per $1,000;  

2.   Regarding improvements, the rate will be $3.50 per 290 square feet of improvements, up from the earlier $2.25 per 290 square feet;  

3.   For the license year commencing February 1, 2024, the rate will be $0.022 (cents) per square foot of land, up from the $0.015 (cents) per square foot of land as of July 1, 2020.  For subsequent license years, the rate per square foot of land will be $0.024 in 2025, $0.026 in 2026, $0.028 in 2027, and $0.03 in 2028 and ensuing years;  

4.  For the license year commencing February 1, 2024 only, an additional 10% escalator will be applicable, in addition to the earlier 2.3% annual escalator, and the total escalator will be 12.3%. 

The total not-to-exceed amount under the contract shall be $3,550,000 over five years. The agreement gradually increases the license fee paid by district property owners. This increases the resources available to the ESD Board to spend on procuring additional services within the district. The City charges administrative fees to collect and distribute these license fees. These administrative fees total between 3 and 4% of the total revenue collected and cover the Revenue Division’s costs to collect and distribute fees, a variable fee associated with the costs of the City’s Integrated Tax System replacement and a portion of the cost of the ESD Coordinator position housed within the Office of the CAO at OMF. The expenditure to Lloyd BID for the net license fees collected will be budgeted at $669,000 in FY 2024-25. These disbursements are always equal to the net of license fees revenue collected within the District less the Revenue Division’s administrative fee and City overhead costs.

Agenda Items

Passed to second reading

Passed to second reading December 20, 2023 at 9:30 a.m.

1071 Regular Agenda in December 20, 2023 Council Agenda

Passed

  • Commissioner Mingus Mapps Yea
  • Commissioner Dan Ryan Yea
  • Commissioner Rene Gonzalez Yea
  • Commissioner Carmen Rubio Yea
  • Mayor Ted Wheeler Absent

Introduced by

Contact

Karl Lisle

Spectator Venues Program Manager

Requested Agenda Type

Regular

Date and Time Information

Requested Council Date