Businesses, Developers Balk At Portland's New Progressive Ordinances
Portland voters on Tuesday decisively put the city at the forefront of progressive urban politics, raising the local minimum wage to one of the highest in the nation, imposing rent control and lifting a cap on recreational marijuana shops.
Some of the city’s employers and housing developers are rattled, and say the changes will force them to look elsewhere for business opportunities.
Four of the five ballot items Portland voters approved were proposed by a group called People First Portland, an outgrowth of the Southern Maine Democratic Socialists of America.
“People First Portland … achieved a historic victory yesterday in passing a higher minimum wage for all workers, and hazard pay for essential workers, a ban on racist facial surveillance, a Green New Deal to reduce our carbon footprint, and renter protections to prevent price-gouging,” said member Kate Sykes, leading a celebratory press conference on the steps of City Hall.
The measures cannot be changed for five years from enactment, unless by a new citywide vote. That inflexibility was one of the chief reasons seven of Portland’s nine city councilors opposed them. Many in the business community opposed them as well — including the affordable housing community.
Dana Totman is president of the Avesta Housing, which develops and manages hundreds of affordable units in Portland and elsewhere in the region. He says various provisions of the measures would add costs for developers of both affordable and market-rate housing — and likely drive them to seek more opportunities in other communities, such as Westbrook or South Portland.
“I think this will really curtail housing development in Portland, it will really hurt the supply. I think a number of projects that were in the pipeline, in the works are perhaps not going to go forward,” Totman says.
Sykes says that the development community has already failed Portland.
“It doesn’t get much slower than what it already is. So they need to figure that out. And if you look at the ordinance itself it actually increases the amount of affordable housing that must be built when market housing is built,” she says.
That was a reference to a provision raising the number of affordable units developers must include in certain city projects from 10 percent to 25 percent. Several developers say they simply could not profitably meet that standard and will look elsewhere for opportunities.
Meanwhile, city employers are trying to figure out how to survive both the pandemic and the new minimum wage rule. Although a hike from $12 an hour now to $15 will be phased in over three years, its effect will be amplified next month because the measure requires that those who physically work in the city when a civil emergency has been declared must be paid at least 1 1/2 times the minimum wage.
As long as the governor’s emergency orders are in place, that will effectively make the city’s minimum wage $18 an hour, starting next month.
“I don’t know how to pay for it,” says Lori Moses, executive director of the Catherine Morril Day Care Center, where she oversees a staff of 19. “If we reduce capacity, to me as a child care director that means, do I close a classroom? And if I have to close a classroom, which group of children are no longer going to have child care? So the ripple effect means those parents can’t work.”
Em Burnett, another organizer with People First Portland, says the city and state must come to a new reckoning to meet the needs of workers as well as employers during the pandemic.
“We know that when workers are paid more they spend more money in the local economy. We think it’s time to center the needs of workers who are risking their lives to work in the middle of a pandemic. Businesses do have grants available, they have resources available to help them, but workers do not have resources. We need to center them,” Burnett says.
And the organizers — who include former Portland Mayor Ethan Strimling — blamed city officials for failing to address rising inequities before exasperated voters took matters into their own hands. They also say that with the election of two new city councilors who support their issues, they believe a more productive era was launched in the city this week.