Authorize Agreement for District Management Services of the Downtown Portland Clean & Safe Enhanced Services District by Clean & Safe, Inc. for an estimated amount of $58 million over five years
The City of Portland ordains.
Section 1. The Council finds:
- Pursuant to Chapter 6.06 of the City Code, the City has established a property management license fee within the Downtown Portland Clean & Safe Enhanced Services District (the “District”). The purpose of the license fee is to provide revenues to fund supplemental cleaning, public safety, and business development services within the District.
- Clean & Safe, Inc. (“Clean & Safe”) is a 501(c)(3) non-profit district management association representing approximately 600 property owners and managers in the District. Clean & Safe also represents the property managers responsible for paying most of the license fee revenues.
- Clean & Safe currently provides District management services pursuant to Contract No. 30007911, authorized by Council through Ordinance No. 190566 on September 29, 2021. The current agreement between Clean & Safe and the City expires September 30, 2026.
- Due to anticipated changes to Chapter 6.06 which will expand the District boundary and establish new license fee schedules on October 1, 2025, a new contract is needed to coordinate and coincide with those District changes. As outlined in Ordinance No. 190566, Clean & Safe remains a qualified provider of the services for the District with the experience, expertise, and capability that it has. Clean & Safe remains willing to continue to perform services under the current Chapter 6.06 and future Chapter 6.06’s District boundaries and license fee rates.
- In accordance with existing Code Section 5.33.120.C, a Sole Source Procurement Notice was published on October 9, 2024, and remained posted for a minimum of seven (7) business days. The City may award a sole source contract in accordance with City Code Chapter 5.33.
- The expenditure to Clean and Safe for the net license fees anticipated to be collected is budgeted at approximately $9.9M in FY 25-26. These disbursements will always equal the net of license fees revenue collected within the District less the Revenue Division’s administrative fee and City overhead costs.
- Both the City and Clean & Safe recognize the desire for greater accountability, transparency, and regular reporting on District activities. The proposed management agreement, attached as Exhibit A, includes new reporting and oversight mechanisms like those included in other recent enhanced services district renewals.
- Clean & Safe 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 District (ESD) Program and the subsequent report from the City’s consultant, BDS Planning & Urban Design, that provided recommendations for improvements for the Program.
- The proposed new five-year management agreement will commence on October 1, 2025. This delayed commencement will allow Clean & Safe to complete its services under the contract that pertains to the boundary and license fee rates that are applicable up to September 30, 2025. Contract No. 30007911 will be terminated on September 30, 2025.
NOW, THEREFORE, the Council directs:
- The City Administrator or designee, is authorized to execute an agreement with Clean & Safe, Inc. to manage and provide certain Downtown Portland Clean & Safe Enhanced Services District property management services, in substantially the form attached to this Ordinance as Exhibit A, for contract commencement on October 1, 2025, and upon City Attorney approval as to form.
Exhibits and Attachments
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 Clean & Safe District, also called “Clean & Safe District”, or the “District.” The purpose of the license fee is to provide revenues to fund supplemental cleaning, graffiti removal, safety, community health outreach, crow abatement, marketing and tourism promotion, business attraction and retention services within the District.
This ordinance approves the new 5-year agreement with Clean & Safe, Inc. for Enhanced Services District (ESD) management services. A companion ordinance is before the City Council on October 31, 2024, to meet the sunset review requirements in City Code 6.06.220, update the rate structure and District Boundaries and extend the District for an additional ten years.
Clean & Safe, Inc. is a non-profit organization representing a approximately 600 property owners and managers in the Clean & Safe District. The Clean & Safe District initiated the establishment of the license fee. The Clean & Safe District 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. Clean & Safe, Inc. is a “qualified contractor” as defined in PCC 6.06.020.N.
In absence of any other qualified non-profit who could fulfill the work, the Clean & Safe District, in accordance with City Code 5.33.120.c, a Sole Source Procurement Notice was published on October 9, 2024, and remained posted for a minimum of seven (7) business days. The City may award a sole source contract in accordance with City Code Chapter 5.33.
Financial and Budgetary Impacts
This contract is a continuation of the arrangement between the City and Clean & Safe that has been in place for many years. The City’s costs to administer the program include 2% of collections that fund the Revenue Division’s cost to collect and distribute the license fee, and 1% to pay for a portion of the ESD Coordinator’s position costs. This arrangement continues in the proposed contract.
Economic and Real Estate Development Impacts
The expected economic impacts experienced due to renewed five (5) year Clean & Safe, Inc. contract, include current and new ratepayers being assessed the property management license fee for five years, beginning October 1, 2025, with the option of extending for another five years starting on October 1, 2030. The property management license fees support the district enhancement work conducted by Clean & Safe, Inc., benefiting the entire district. This work includes supplemental cleaning, graffiti removal, safety, community health outreach, crow abatement, marketing and tourism promotion, business attraction and retention services, all benefiting the entire district. These supplemental services provided by Clean & Safe, Inc. are above and beyond what the City can provide and are meant to enhance the Clean & Safe District making it more attractive as a destination and place for investment.
Community Impacts and Community Involvement
Clean & Safe, Inc. provides cleaning, graffiti removal, safety, community health outreach, crow abatement, marketing and tourism promotion, business attraction and retention services for the Clean & Safe District. If Clean & Safe District’s proposal is passed (by separate, companion ordinance), these services will expand from being provided in approximately 213 Downtown city blocks to over 270.
To provide a snapshot of the community benefit that Clean & Safe District provides, the following stats reflect monthly averages for Clean & Safe, Inc.’s most public-facing programs from January 2024 through August 2024.
Cleaning Program:
- Collection of over 5,800 bags of trash
- Collection of over 2,033 needles from the right-of-way
- Collection of over 1,300 needles from four drop boxes
- Cleaning of over 4,100 doorways
- Pivot of cleaning services to areas in need of special attention over 6,100 times
- Removed graffiti over 2,500 times
- Collection of over 4,700 items associated with drug use
Public Safety Program:
- Assisted business over 1,900 times
- Assisted citizens over 400 times
- Patrolled the district over 2,400 times
- Fielded extra patrol requests over 600 times
- Performed over 130 welfare checks
- Responded to over 30 disorderly conduct calls
- Responded to calls regarding aggressive individuals over 20 times
Additionally, Clean & Safe, Inc. recently wrapped up a few of its annual reports, reflecting ratepayer and stakeholder sentiment, and while there are a few areas of concern, there are many reasons to be optimistic about Downtown’s trajectory and the positive impacts Clean & Safe, Inc. is having on its district:
- Downtown Business Survey, reflecting experiences of business owners and managers operating in their district between October 1, 2022, and September 30, 2023, and found that:
- 72% of respondents indicated they were somewhat or very much satisfied with Clean & Safe, Inc. services;
- 58% of respondents indicated they were satisfied with the Janitorial Program;
- 86% of respondents indicated they were satisfied with the Public Safety Program;
- And 91% of respondents indicated they were satisfied with the Holiday Lighting Program.
As part of their business attraction efforts, Clean & Safe, Inc. activated 9 vacant locations with pop-up businesses, focusing on placing minority and women owned small businesses and retailers in those spaces. This program has seen success in activating vacant retail space and graduating pop-up retailers into permanent, long-term leases. Furthermore, for the first time ever, Clean & Safe, Inc. offered grants to new retail businesses signing leases in the district. Grants totaling $75,000 went to four businesses and assisted them with tenant improvements and marketing efforts.
Clean & Safe, Inc’s work has a positive impact on Portland’s downtown core. Through their Janitorial, Public Safety, Retail Programs, etc., Clean & Safe, Inc. continues to offer solutions that benefit the business and residential communities here in Portland, while attracting visitors to spend time and money in the district year-round. Clean & Safe District, by way of their contract with Clean & Safe, Inc. provides many valuable services to their ratepayers – services that would otherwise not be provided for the district.
In 2020, the ESD Program was audited resulting in the City hiring a consultant (BDS Planning & Urban Design) to review the audit findings, assess the Program, and make recommendations for improvements. The consultant’s assessment and recommendations were presented to City Council on February 14, 2024, and unanimously accepted. Clean & Safe, Inc. and the Clean & Safe District are embracing these recommendations as part of their work leading to their proposal. One example of this is the inclusion of annual meetings open to all ratepayers in the Annual Scope of Work.
Several other recommended changes to the structure of the District are being implemented by the companion ordinance.
100% Renewable Goal
N/A
Financial and Budget Analysis
Items 951 and 952 both update Title 6 to reflect impending charter changes and increase the size of the Clean & Safe district to add 60 Downtown blocks (116 acres) and sunset the existing contract (currently slated to expire in Sept 2031) and renews a new 10-year contract beginning in 2025 with new boundaries and an updated rate structure. The program is fee-funded and self-supporting and there are no immediate expected impacts to the City's General Fund.