COST Comments: For many years, Portland has been pursuing a “sustainable,” high tax strategy; trumpeting trolleys, light rail trains and high density living as the approach to make Portland more livable and more prosperous. They have, finally, awakened to the fact that people and businesses have been fleeing this vision of urban utopia. It is not business friendly and people are unable to afford the dramatic increase in housing costs. Portland’s median home price is 29% higher than Austin’s as of the 3rd quarter of 2009 and the median household income was slightly less than Austin’s $59,200. Portland’s lack of affordable housing has resulted in public school enrollment declining to almost one-half of its peak. Portland’s peak enrollment was about the same as Austin’s current public school enrollment of over 80,000.

Below is an excerpt from a Portland Development Commission Request for Proposal (RFP) work statement soliciting consultants’ proposals to help them better understand why their predictions have not been achieved and why they are, instead, in a “melt down.” Major reasons for this Portland situation seem rather obvious when compared to other cities with similar fantasies of “Smart Growth”: draconian land use controls designed to force high density drive up development and housing costs; and, wasteful spending of billions of transportation dollars on ineffective trolleys and light rail trains degrade overall mobility. Quality of life suffers as it is directly linked to mobility and housing affordabilityj.

We hope Portland hires a consultant which tells them the truth and not the typical consultant in this area which tells you what they want to hear.

From Portland’s RFP:

3.2 CONTEXT AND PROJECT BACKGROUND

The city of Portland, Oregon (the “City”) recently completed an Economic Development Strategy1 (the “Strategy”) guiding business development for the next five years. The Strategy is meant to inform investments and guide strategic initiatives related to business attraction, retention and growth. The overarching theme of the Strategy is one of sustainabiity, with the ultimate goal of creating the most sustainable economy in the world.

The Strategy makes clear that while Portland has excelled at creating an enviable quality of life, it has lagged in economic growth. The structure of Portland’s economy causes it to be more vulnerable to declines in consumer spending, business investment and international trade than the nation as whole, and lags peer cities such as Seattle and San Francisco in job creation and wages. Portland’s unemployment rate exceeded 12% in Maech 2009, far above the national average of 8.5 percent, and the number of unemployed persons has more than doubled, from 60,000 to 140,000 over the past year.

Even during periods of strong regional employment growth, the city consistently lags in jnh creation; and the job growth occurring in the region happened outside downtown Portland. Between 1998 and 2006, the percentage of regional jobs located more than 10 miles from downtown increased from 23.8% to 29.4%. Over the same period, the percentage of regional jobs within three miles of downtown decreased from 27.4% to 23.4%. With the region’s workforce expected to grow at 2.4 percent annually — about six times faster than in the nation as a whole, even in the face of job declines - the need for job growth will become even more pressing.

Through the course of developing and implementing the Strategy it has become increasingly clear that entrepreneurship is a key driver of the local economy, and has the potential across industries to play an even greater role in job creation. Over 95% of Portland’s businesses have less than 50 employees, and the majority of new jobs are created by small firms either opening or expanding. Measured by new business formation, the Portland metropolitan region is ranked sixth nationally for entrepreneurial activity2.

Understanding the dynamics of the entrepreneurial community in Portland can help inform policy and initiatives for maintaining and growing the city’s status as a pioneering place for business. In particular, it is important for the city to identify and track entrepreneurial activity so that it can effectively respond with the proper planning and resources for continued entrepreneurial vibrancy.

To better understand the factors influencing entrepreneurship in Portland, through this RFP, PDC is commissioning a study to detail the state of entrepreneurship in the region (the “project”). The project is intended to inform and energize the conversation about entrepreneurship in Portland and detail how the City, through its economic development efforts, can better support entrepreneurial development and activity. The project should include appropriate data to demonstrate the impact of entrepreneurship on the Portland economy, and serves as the ——–

1. See http://www.pdxeconomicdevelopmentcom/docs/Portland-Ec-Dev-Stratesv.pdf
2. The US. Small Business Administration ranked the Portland MSA 6thin the nation among large MSAs for entrepreneurial activity (Entrepreneurship in Silicon Valley During the Boom and Bust, Small Business Research Summary, SBA Office of Advocacy, March2007).
_____________________________________________________________________________________ RFP 09-28 Page 5 of 26

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