The Bend City Council on Wednesday voted 4-2 to advance a proposal to add new fees for commercial property owners in the Bend Central District, with hopes revenue will prod a vision for redevelopment that’s seen a sluggish start.
The fees would provide money for anything from new lighting and landscaping, marketing and promotions, events, security, cleaning and infrastructure maintenance. It would also pay staff to run the Bend Central District Business Association, a group of business owners and developers east of the Bend Parkway that proposed the fees earlier this year.
But since then, a wave of opposition has formed from property owners, including industrial owners who say mounting costs will drive businesses and jobs out of the area. They have the power to kill the proposed fees if owners of more than one-third of commercial space in the district are opposed at a hearing in July.
First, the City Council is slated to establish a sub-jurisdiction called an Economic Improvement District. The boundary would stretch from the Bend Parkway east to Fourth Street, and from the 3rd Street railroad tunnel north to Revere Avenue.
“I’m comfortable moving forward with the proposal that’s before us,” said Bend City Councilor Mike Riley during a public hearing on Wednesday. “It’s very clear that we may have growing opposition from the reasons we’ve heard tonight,” he said, adding, “if that’s the case, we won’t have funding for it.”
The proposed fee would start at 10 cents per square foot of commercial space. That would generate $179,435 per year. Examples of individual costs could range from about $400 a year for a plant store to $4,000 for a hotel, according to the business group. The rate, anticipated to increase by 1 cent each year would start at one-third the rate of the Economic Improvement District in downtown Bend, which was established about 20 years ago.
For years, city and business leaders have eyed the 200-acre old industrial neighborhood east of Bend’s major highway as a place to sprout upward growth. It’s envisioned as a mix of dense housing, eclectic businesses and walkable streets. An urban renewal district called the Core Area, which allows the City to capture and reinvest property taxes on new development, is pouring millions into major infrastructure projects like a planned pedestrian bridge over the parkway at Hawthorne Avenue, and safety improvements for Franklin Avenue and its nearby railroad tunnel.
Franklin Avenue is also the prospective home for a new city hall.
But some private developers, particularly of multi-story housing, are still on the sidelines, waiting for more favorable economic conditions and clarity over future City projects.
Aside from beautification, economic development fees would shore up maintenance funding for urban renewal projects, said Daniel Elder, director of operations at Visit Bend and member of the Bend Central District Business Association Board of Directors.
“It could be used quickly to create visible improvements right away, helping to reduce risk and encourage private investment leading to development,” Elder told the City Council Wednesday.
New fees would pay for an executive director to run the business association, which is currently led by developers and business owners in a volunteer capacity. Board President Kurt Alexander, who developed of the Dogwood at the Pine Shed, a cocktail bar, food cart pod and event space on Second Street, did not respond to a request for comment by the Source’s deadline.
The proposal is supported by the Bend Chamber of Commerce and the Bend Economic Development Advisory Board, a City committee.
Several property owners pushed back against the proposed fees at a public hearing, including industrial properties that don’t benefit as much from foot traffic. Others say the proposal will simply add to a cascade of rising costs imposed by the city. The City is phasing in a new transportation utility fee that charges businesses by the square foot for road maintenance.
“At a minimum, you risk driving small industrial tenants out of Bend to Redmond and La Pine,” said Sylvia McFarland, an industrial property landlord. “Asking industrial tenants to help pay to spruce up the neighborhood is a little like a family buying acreage in a farming area to build a large home and then complaining about the smell of the farm animals or the farm equipment littering the area.”
Based on current feedback, city staff estimates that owners of up to 450,000 square feet of the 1.6 million square feet of commercial property in the district are likely to oppose the new fees, which is close to one-third. Property owner Randy Windlinx told the City Council Wednesday the number is greater. In an email, he provided an opposition letter that he says owners of about half of the square footage have signed on to.
“At this point, it’s a dead issue,” Windlinx told the council. He said he believes the proposal is out of line with state statute for creating Economic Improvement Districts. “Whatever you do, we’re going to continue to fight it.”
Bend City Councilor Gina Franzos said feedback she’s heard via email since the proposal came forward in January caused her support to turn. She suggested pausing the plan to clear up concerns.
Franzosa has been attending the Bend Central District Business Association meetings as a liaison.
“It’s never come up in conversation as concerns,” Franzosa said. “It sort of worries me that we’re making a decision about something when these concerns are being raised now and we haven’t really vetted those.”
She and Councilor Steve Platt voted against advancing the proposal on Wednesday.
Others said they hoped the business association could work to ease concerns before the vote.
“We know the BCDBA has heard these concerns, has work to do to keep talking to owners about what the benefits are and how it can benefit everybody,” Bend Mayor Melanie Kebler said Wednesday. “We’ll see what we get from the vote and we can move from there.”
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OMG. Bend making it more expensive to live and shop in Bend? What a tone def city! Any “Fees” which regular people call taxes get passed on to the consumer or the business ears and reduces their profits. So, more businesses will fail. Nice job Bend.
Pro development again….. Christ on a bicycle get a clue city government. People who live here don’t want this. You have nice areas that are established and accessible already. Stop.
Small business takes a hit so big developers can run amok.
The City Council really enjoys finding ways to kill small- and mid-scale economic drivers to advance interests that pay kickbacks.