February 14, 2012
The Honorable Sam Adams
City of Portland
1221 SW Fourth Avenue
Portland, OR 97201
Dear Mayor Adams,
On behalf of Portland Business Alliance, the Downtown Retail Council (a division of the Downtown Clean and Safe District), Travel Portland and Portland Mall Management Inc, we are writing to you today to express concern over the proposed cuts to the Downtown Marketing Initiative in the Bureau of Transportation budget. While we understand the significant shortfall faced by the bureau, the downtown business community made an agreement with the city that, in exchange for increasing parking fees and hours, the city would reinvest a small portion of the funds generated to the revitalization of downtown, including a contribution to the Downtown Marketing Initiative. In the spirit of this partnership, we urge you to restore funding of the Downtown Marketing Initiative.
The Downtown Marketing Initiative partnership leverages public and private investments to ensure downtown remains healthy and relevant in an environment of increased suburban competition and economic uncertainty. Downtown retailers reported that Occupy Portland protests negatively impacted their business, with customers reporting a negative perception of downtown safety and comfort. Now, more than ever, the Downtown Marketing Initiative’s goal to promote downtown as a safe, easy, convenient destination is needed.
Funding for the Downtown Marketing Initiative was originally established in 2008 through Portland Bureau of Transportation funds and a retailer-supported increase in on-street parking fees and Smart Park per hour rates from $1.25 per hour to $1.50. In 2009, when the transportation bureau faced a budget shortfall, the retail community again agreed to increase parking rates and extend the hours for paid parking to evenings and Sundays. In both cases the retailers agreed with the understanding that a portion of the revenue would be used to fund the Downtown Marketing Initiative.
Parking revenue, the vast majority of which is generated downtown, now accounts for approximately 20 percent of the transportation bureau’s general fund budget. Downtown retailers generate nearly $1.5 million a year in parking revenue through parking validation programs. These funds are spent across the city to support the transportation system for the entire community. Simple equity and fairness dictates that at least a portion of the funds generated by downtown be reinvested in downtown.
The Portland Business Alliance annually collects feedback and comments from businesses in the Central City; in our most recent survey, 39 percent of all respondents indicated that the cost of parking downtown is too high and needs to be improved. Over 100 businesses provided comments indicating that parking fees, fines and Sunday parking was driving business away from downtown. The Downtown Marketing Initiative programs shift some of these perceptions and offset the competitive disadvantage that downtown endures due to parking costs through a comprehensive marketing program publicizing downtown Portland’s unique retail, restaurant and cultural offerings, cleanliness and safety.
Downtown is the region’s core economic development engine, and its success is key to the strength of the city and the region. Highlights of downtown’s contribution to economic vitality over the past five years include $275 million in Business License Fees ($48 million annual average); over $7 million in parking validations within the city-owned SmartPark garages; $22.5 million in cleaning and security services provided via the Clean and Safe District, and $22 million from the business community for the Portland Transit Mall.
The Downtown Marketing Initiative has leveraged the public and private investment well and has made great strides in the two years since the new funding mechanism was put into place:
- Expansion from a holiday-only marketing effort to year round marketing promoting seasonal events focused on retail, restaurants and the performing arts;
- Addition of new communication channels to include a robust social media presence with communications reaching a base of 60,000 contacts;
- Perception surveys measuring the public’s favorable feelings about Downtown increase an average of 4 percent after the holiday marketing push (in 2009, from 66 percent to 72 percent, in 2010, from 64 percent to 66 percent, and in 2011, from 61 percent to 68 percent);
- A downtown retail sales composite matrix made up of sales results from over 15 downtown businesses, showing an increase of 14 percent in 2010 and an estimated 10 percent in 2011, pending the end of fiscal year;
- Incorporation of nonprofit charitable partners in promotions, including New Avenues for Youth and Transition Projects Inc, organizations that have raised over $75,000 in cash and in-kind donations thanks to Downtown Marketing Initiative activities.
The supportive partnership programs of Downtown Marketing Initiative ensure that businesses remain healthy and relevant in an environment of increased suburban competition. These programs are particularly significant during economically challenging
times, particularly when other financial tools such as urban renewal are declining in presence in the central city. Approving the Downtown Marketing Initiative’s full budget request as submitted will go a long way to ensure the success of the public and private investments within our city’s core. We urge the City of Portland to fully fund this important program. Thank you.
Sandra McDonough Phil Kalberer
Portland Business Alliance Chair, Portland Mall Management Inc.
Jeff Miller William Palmer
Travel Portland Chair, Downtown Retail Council