Target plans to close three Portland stores, effective Oct. 21, including the Galleria at 939 S.W. Morrison St.
In August 2023, Governor Tina Kotek announced the formation of a Portland Central City Task Force (PCCTF), a convening of local elected, business, and community leaders working to tackle issues impacting the economic future of Portland’s Central City. Basically, this is in response to the problems of homelessness and drug use on the streets of Portland, and the exodus of businesses from the city due to alleged theft of retail stores. The office vacancy rate in downtown Portland has reached to 31.5%, among the highest in major U.S. cities.
The charge of the Task Force is to articulate a compelling vision for Central City Portland’s economic future and develop an action plan to revive Portland’s role as an economic engine for the state and a desirable place for business, residence, education, arts, entertainment, and shopping. The 50 member task force includes 12 national, state, county, and local elected officials. The PCCTF is slated to present recommendations at the Oregon Business Plan Leadership Summit in December. Its meetings are held in private, much to the chagrin of the city’s activist public interest community.
One of the major tools already in place is the Portland Enterprise Zone. Mayor Wheeler and City Commissioner Rubio led a decision to allow Prosper Portland, the city’s economic development agency, to expand the enterprise zone boundaries to include basically the entire central city. The Portland E-Z offers a 5-year property tax abatement on new capital investments. It excludes from the abatement prior existing improvements and land values.
Tax abatement seems to be a popular incentive tool in many other cities throughout the country, not only here in Portland… one tax break piled on top of another. But, as we well know, this is a one-way street – revenue out, no income in. There are urgent public service needs that are already underfunded. Are more service cuts going to help? Tax abatements might have some effect on business retention, but will have little effect on eliminating homeless encampments or street crime. Replacement income will have to be found.
Our objective at Common Ground OR/WA is to try and influence the PCCTF’s focus on tax policy. A Tax & Services Committee has been formed. We want to meet with members and engage in dialogue about alternatives: a state authorized land value tax or land value capture mechanism for limited areas like enterprise zones. Hopefully we can convince members that tax incentives do not have to result in revenue losses. One goal is to garner support for an LVT study bill in the upcoming legislative session.
A land value tax, which taxes only the land’s value and not the buildings, will not only lower the effective cost of new construction, but raise the cost of holding onto vacant and underutilized parcels. The split-rate tax has been tested and proven effective for many decades in Pennsylvania.