A Controversial Private Cleaning and Security Nonprofit Is Supposed to Make Downtown Sparkle. But Where Is the Money Really Going?

Some businesses that pay into the district may be even more alarmed than homeless advocates and city commissioners.

When Jessie Burke and her business partners opened the Society Hotel in Portland's Chinatown in 2015, Burke knew the neighborhood would present challenges: fights, people sleeping on the sidewalks, and lots of trash.

Burke persevered, although she sometimes grew frustrated when she called Downtown Clean & Safe, the privately funded nonprofit that provides security and hygiene services to 213 square blocks downtown.

Every property owner in the district pays an annual fee, collected by the city—for the Society Hotel, it's about $800.

But when Burke joined Clean & Safe's board last year, what she learned alarmed her.

Burke found that a significant portion of the money that goes into Clean & Safe actually pays salaries and overhead for a legally separate entity, the Portland Business Alliance.

She says that was news to her and many other business owners she's shared that information with.

"It just doesn't make sense," Burke says. "It's not efficient."

Demands on Clean & Safe have exploded. In 2012, its crews picked up 3,000 bags of trash downtown.

Over the past year, amid a city paralyzed by the COVID-19 pandemic, that number soared to 70,000 bags—not to mention tens of thousands of hypodermic needles and other "biohazards."

Clean & Safe, founded in 1988, operates under a 10-year contract with the city of Portland, which collects taxes from property owners in the district—$5.4 million this year—and allows it to operate in public spaces. The contract is up for renewal this year.

That decision will be contentious. Some advocates believe Clean & Safe mistreats the homeless, a concern highlighted in a critical city audit last year. And at least two city commissioners, Jo Ann Hardesty and Carmen Rubio, bristle at some of Clean & Safe's security guards carrying guns. All of which raises the stakes for a little-known organization that plays an enormous role in the public perception of the city's most important neighborhood.

Behind the scenes, WW has learned, some businesses that pay into the district may be even more alarmed than homeless advocates and city commissioners.

Their concern is different: Burke and some other business owners don't think they're getting their money's worth.

Internal documents, including emails and correspondence, and interviews with current and former board members show they're airing frustrations about the district's convoluted financial relationship with the PBA.

"Clean & Safe's model could be good," Burke says, "but a separate organization is sucking all of the resources away."

Burke voices a concern of other downtown property owners, particularly those in Old Town: Even with the extra money they pay for private cleaning and security, the city is dirtier and more dangerous than they can remember.

Their frustration echoes that of regular taxpayers who wonder if government is doing all it can to return Portland to health. Except in the case of businesses paying a supplemental tax, their questions are aimed at whether the Portland Business Alliance, the city's largest advocacy group, is using too much of their money to pay its own expenses—a concern that PBA CEO Andrew Hoan says is without merit.

When Burke joined the board of Downtown Clean & Safe last fall, she discovered nonprofit was paying about 45% of the salaries of the top officials and support staff at the Portland Business Alliance, a 501(c)(6) nonprofit that advocates for nearly 1,900 member businesses. (Disclosure: Those members include WW's parent company.)

PBA holds long-standing contracts with Portland Patrol Inc. for security and Central City Concern for street cleaning. Yet the money for those contracts comes from Clean & Safe. That means PBA is by far Clean & Safe's largest contractor (and takes a 3% cut from the contracts).

Yet Clean & Safe's executive director, Maureen Fisher, reports to the PBA. Fisher, whose total compensation will top $200,000 this year, reports not to the Clean & Safe board but instead to Hoan.

"How is she supposed to hold him accountable for the contracts when she reports to him?" Burke asks.

"That's unusual," says Beatrice Dohrn, director of the nonprofit clinic at the University of Oregon School of Law. "The executive director of a 501(c)(3) should report to the board of the (c)(3), period."

Clean & Safe funds also pay a share of PBA's rent at the World Trade Center—and $26,000 for a spot on the PBA board.

So why does any of that matter? An email from Matthew Goodman, whose family is one of the largest downtown property owners, spells it out.

"As a significant rate payer, I'm uncomfortable being obligated to funding Clean & Safe long term unless we have significant and sustained improvement in our services," Goodman wrote to fellow Clean & Safe board members in an email Jan. 13, 2021.

Every dollar spent on administration, of course, is a dollar not spent on direct services. Of the $5.4 million Clean & Safe will collect this year, about 72% will go directly to cleaning, security and lighting contracts. The rest goes to overhead.

Goodman, who did not share the email with WW, declined to comment for this story, but he sits on the boards of both Clean & Safe and PBA.

Many business owners who pay into Clean & Safe have another issue as well: Their payments to the business improvement district cover administrative costs for an organization—the PBA—to which they don't belong.

And many of PBA's largest members, such as Intel and Precision Castparts, don't have offices downtown—and so aren't part of Clean & Safe.

Dan Lenzen, who has run and owned a variety of properties, bars and nightclubs—most recently, the Dixie Tavern, in Old Town since 1985—wants every possible dollar funding Clean & Safe's services.

"I don't feel downtown is clean or safe," Lenzen says. He doesn't know all the details of how Clean & Safe spends its money, he says, but would like to see the organization focus on being as efficient as possible with the money it has.

"Any business that is not successful needs to be nimble enough to change its course," Lenzen adds.

David Gold, an Old Town property owner, says he was unaware until Burke told him that his payments to Clean & Safe subsidize the PBA. Gold says that for the first time, he's had to hire his own additional private security.

"Conditions on the street are by far the worst I've seen in the 16 years I've been in Old Town," Gold says.

Tension over the relationship between Clean & Safe and PBA has been bubbling for a while. In September 2019, the Clean & Safe executive board wrote to Hoan, the PBA's CEO, expressing a desire for more separation between the organizations and for Fisher to report to it, instead of him to "better follow the bylaws and to avoid placing our 501(c)(3) status at risk." After much back and forth, no change.

Representatives of four of the largest downtown property owners, each of whom sits on the board of both organizations, prefer the status quo.

"The current Downtown Portland Clean & Safe model is highly efficient. Shared resources allow the nonprofit to redirect funds from staffing and administration to direct street-level services," said Vanessa Sturgeon of TMT Development, Jim Mark of the Melvin Mark Companies, Justin Delaney of The Standard, and Patrick Gilligan of Lincoln Property Company in a joint statement. "Both organizations benefit from this arrangement. It's important to revisit partnerships regularly, but during a crisis is the wrong time."

Hoan agrees and says critics such as Burke are missing the point: Clean & Safe benefits from PBA's advocacy and communications work while the alliance picks up more than 55% of staff costs.

He acknowledges the organizations are legally separate, but he says that their shared interests in a thriving downtown make a partnership the best way to serve their constituents. "It's better for both organizations," Hoan says.

Audit results show that he and other administrative staff spend more than 50% of their time on Clean & Safe issues and that administrative spending has declined under his leadership, leaving more money for direct services.

"What the ratepayers want to see is a combination of the cleanup and security and advocacy," Hoan says. "We are doing exactly what they want."

Not all of them. Frustrated by pushback from longtime board members for her demands for greater transparency and accountability, Burke resigned from the Clean & Safe board in late January.

"After I joined, I told the board we can clean this up now or I'll resign and tell the press," she says. "Because no one knows about this."

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