192102

The City of Portland ordains.

Section 1. The Council finds: 

1. Resolution No. 37638, adopted November 29, 2023, provided direction from Council to the Office of Management and Finance’s Division of Asset Management, the predecessor of Bureau of Fleet and Facilities (“BFF”), to undertake planning to identify and onboard in-district offices to accommodate new City Council activities within the four respective City Council districts.  
    
2. Resolution No. 37668, adopted July 3, 2024, amended Resolution No. 37638 to remove the requirement for BFF to identify and onboard in-district offices by January 1, 2025.
    
3. Resolution No. 37668 did not preclude BFF from re-initiating the identification and development of in-district offices if requested by a future Council, nor did it require BFF to identify and develop in-district offices absent a future Council directive to do so.
    
4. District 1 Councilors Avalos and Dunphy have identified space located at 305 NE 102^nd Avenue (“Multnomah Plaza”) as being optimal for their joint-use and their community’s needs and wish to request the Mayor, or the City Administrator as the Mayor’s delegee, to execute a lease on their behalf.
    
5. The landlord of Multnomah Plaza is willing to lease the space to the City at commercially reasonable rental rates and terms through June 30, 2029.
    
6. As certain fixed resources will be shared equally by Councilors Avalos and Dunphy, the Multnomah Plaza lease will be executed with, administered, and paid for through the budget resources of BFF’s Facilities Services Division, on behalf of Councilors Avalos and Dunphy.
    
7. In preparation for this District 1 office project, $705,000 was transferred from certain Councilors’ office budgets to the Facilities Services Fund in FY 2024-25. Facilities will use this money over the term of the lease first to fund one-time office space improvements and then annual lease and related operating costs.
    
8. Tenant improvement costs for one-time construction are anticipated to be funded via a combination of landlord and tenant contributions, with City of Portland contributions estimated at not more than $350,000 and paid for out of the $705,000 in available funding. The total cost of the Multnomah Plaza lease for the duration of the full term is estimated to not exceed $300,000. Any funds remaining from the $705,000 in available funding will serve as contingency for one-time construction costs and as reserve funding for any ongoing, unforeseen lease-related costs through the end of the lease term.
    
9. Recovery of all BFF costs associated with this lease must comply with City Financial Policy 2.08.04. Therefore, if funds are required in excess of the $705,000 already available, Councilors Avalos and Dunphy will have to provide further funding from their respective office budgets through amendments to their Interagency Agreements with BFF – Facilities Services. As all costs have been forecast, and the $705,000 in funding already set aside for this project is anticipated to satisfactorily absorb all foreseeable costs through the term of the lease, the probability of needing additional funding is low.
    
10. However, Councilors Avalos and Dunphy are bound by this Ordinance to ensure that each of their respective requested budgets through FY 2028-29 identify any currently unforeseen funds to ensure that all costs associated with the lease through the end of the lease term are paid for from their budgets.
     
11. The current terms of District 1 Councilors are set to expire on December 31, 2028. The general election on November 7, 2028, will determine future District 1 Councilors, who may or may not have the same desire for in-district offices.
     
12. The lease is anticipated to have an option for term extension. A decision to extend the lease must be made in accordance with the timeline for exercise of the anticipated option and the requirements of the future District 1 Councilors. If renewed, the lease terms and costs may change starting on July 1, 2029, as determined by the landlord, as may the apportionment of costs between Councilors, as decided by the future Councilors.
     
13. Should the lease not be renewed, all costs expended on the lease between January 1, 2029, and June 30, 2029, including site decommissioning costs if needed, will be paid for out of the existing Facilities Services Fund account dedicated for this purpose. If insufficient funds exist to cover the costs in FY 2028-29, they must be borne by the budgets of the future elected District 1 officials, excluding Councilor Loretta Smith if re-elected. 
     
14. In the event a District 1 Councilor elects to vacate the leased premise prior to the conclusion of the term of the original lease, the vacating District 1 Councilor agrees that the remaining designated funds in the Facilities Services Fund account will cover the remaining portion of their costs associated with this lease, as defined herein, for the remainder of the lease term, and that half of any unavoidable unforeseen costs will be paid for out of their office budget. In the event the third District 1 Councilor elects to join Councilors Avalos and Dunphy at Multnomah Plaza at any time, payment of any site reconfiguration costs and ongoing lease-related costs will be fully funded by the District 1 Councilors, as negotiated by those Councilors. 
     
15. In no instance will any costs associated with this lease go unpaid or require subsidy by a City executive or administrative office (including BFF or another City bureau), unless the Mayor and City Administrator identify a specific operational need for a non-Downtown office location that matches the specifications of this site, have sufficient budget appropriation from Council to cover the costs of this lease in full, and are willing to assume relevant lease obligations. 

NOW, THEREFORE, the Council directs:

1. The above Findings represent the commitment of this Council and the identified District 1 Councilors to the obligations stated.
2. A lease for in-district office space consistent with this Ordinance may be executed with the Multnomah Plaza landlord, or if needed with another suitable landlord for a similar space under substantially similar terms, for occupancy and use by Councilors Avalos and Dunphy as per this Ordinance. All legal documents shall require approval as to form by the City Attorney, or a designated deputy, prior to execution.
3. The lease’s fiscal and performance commitments are assigned to BFF. Councilors Avalos and Dunphy will occupy and use the leased space in compliance with the terms and conditions of the lease, and will exercise best efforts to support BFF’s lease administration.
4. The Mayor, or delegee, is requested to support the Council and District 1 Councilors through appropriate negotiation, execution and management of the lease.
5. Payment for one-time improvements to the space, the cost of the lease, and all associated ongoing costs will come from a designated account in BFF’s Facilities Services Fund. Should this account be depleted, any additional expenses shall be fully reimbursed from  the budgets of Councilors Avalos and Dunphy in accordance with the Interagency Agreements these Councilors have with BFF.
6. The Mayor and City Budget Office are requested to support the commitment of Council and the District 1 Councilors by preparing future budget documents to account for all legal, contractual and fiscal obligations of the executed lease. 

Section 2. The Council declares that an emergency exists in order that an in-district lease may be executed on or about October 1, 2025; therefore, this Ordinance shall be in full force and effect from and after its passage by the Council.