Roadblock in the Broadway Corridor?


By Don McIntosh

Broadway Corridor, the biggest central city redevelopment opportunity Portland has seen in three decades, has hit a snag. Negotiations appear to be breaking down between the City of Portland’s development agency, a union-community coalition, and a Denver-based developer over how working Portlanders will benefit from the redevelopment of 16 city blocks that straddle the border between Portland’s Old Town/Chinatown and Pearl District neighborhoods. Most of the real estate is publicly owned by Prosper Portland—the City’s economic development and urban renewal agency—and the jewel of the project is the 12-block former U.S. Postal Service (USPS) mail processing plant. The City bought that property in 2016, and USPS moved out in June 2018, relocating to a new mail processing plant near the airport.

City-brokered community discussions about what to do with the Broadway Corridor have been going on since at least 2015. From the beginning, City officials committed to an environmentally-sustainable neighborhood combining retail and working space with high-density affordable and market-rate housing, and they also committed to maximizing economic opportunities for minority Portlanders. To spell out in detail how the Broadway Corridor redevelopment will benefit the community, not just the developers, they also committed to negotiate a community benefits agreement (CBA).

Those are the negotiations that may have reached an impasse, according to multiple interviews with representatives of the Healthy Communities Coalition. The Healthy Communities Coalition formed in 2015 as an alliance of minority, environmental, business, and labor organizations. It includes Operating Engineers Local 701, IBEW Local 48, Amalgamated Transit Union Local 757, Portland Fire Fighters Local 43, Service Employees Local 49, Pacific NW Regional Council of Carpenters, Oregon AFSCME, ProTec Local 17, the Columbia Pacific Building Trades Council, and the Metropolitan Alliance for Workforce Equity (MAWE).

“At the time, we were seeing gentrification, a massive buildup in neighborhoods that had never seen that kind of development before,” says Vivian Satterfield, an environmental justice organizer with the group Verde who helped convene the coalition. “We were seeing low income and communities of color displaced. We heard from the Carpenters union that they couldn’t afford to live in the buildings they were building. And we asked, ‘How can we come together to ensure our sectors will not continue to be pitted against each other when it comes to the development of our city?’”

Prosper Portland agreed to designate the Healthy Communities Coalition as its negotiating partner to hash out the terms of the CBA. Since formal talks started last summer, coalition representatives have met more than 18 times with Prosper Portland officials and representatives of the developer, Continuum Partners. Continuum, based in Denver, was selected by Prosper Portland’s board in a unanimous April 2018 vote to serve as the agency’s “master development partner” for the Broadway Corridor project. The exact details of Prosper Portland’s relationship with Continuum are a little murky, but basically Continuum gets the exclusive right to buy and develop the massive USPS site at fair market value in exchange for committing to the CBA and serving as an uncompensated master plan adviser to Prosper Portland before the work begins. Prosper Portland will cover the costs of demolition of the existing buildings and installation of roads, water and sewer connections. In January, Prosper Portland also hired Continuum at $70,000 a month to serve as an owner’s agent overseeing demolition and site prep.

The Healthy Communities Coalition wants the CBA to result in good union jobs for local residents — both during the building phase and when the development is complete. The coalition also wants enforceable targets for the participation of women and minorities in construction, both as apprentice and journey-level workers and as contractors. And it wants the work to be done by “responsible contractors,” which the coalition defines as companies that provide full family health benefits, that are enrolled in state-certified apprenticeship programs, and that don’t have a record of violating labor and workplace safety laws.

Prosper Portland initially aimed to complete the CBA negotiations by April 2019, then June, then December, then February 2020. It’s now June 2020, and the first site prep work is set to begin in July. At its June 10 meeting, Prosper Portland approved a $1.3 million contract with McDonald Excavating, Inc. for demolition and soil remediation of a vehicle maintenance facility on the north side of the property, and a $4.4 million contract with O’Neill Walsh to build a temporary post office on the ground floor of an existing parking structure so that demolition can begin on the main structure. Both firms are union-signatory.

But there’s still no CBA.

For months, Coalition members have been reluctant to go public about their difficulty getting an acceptable CBA, not wanting to alienate their negotiating partners while there’s some hope of a deal.

“It appears that we really have reached a stuck place,” says Healthy Communities Coalition spokesperson Lisa Hubbard. “We’re pretty frustrated, to say the least, with where things are.”

Coalition leaders are drafting a letter to Mayor Ted Wheeler and City Council, which they’ll send in the coming weeks, asking them to intervene in negotiations.

Why the talks have ground to a halt

Continuum did not respond by press time to messages left by the Labor Press. But individuals with direct or indirect knowledge of the talks describe several sticking points. Continuum is balking at requiring construction contractors to provide full family health benefits. There’s also been resistance to having community groups oversee compliance with the targets for women minority and apprentice participation. That community oversight has been part of every other CBA on other recent City projects, says Operating Engineers Local 701 Field Representative Nate Stokes.

“We need to have oversight to make sure contractors are doing what they say they’re going to do,” Stokes said. “To make sure we’re getting the numbers for women, minority and apprentices, we need to have some sort of accountability.”

Coalition members also want Continuum to sign a Project Labor Agreement (PLA) committing to use union labor. They say Continuum doesn’t want to do that until it selects a general contractor, but Continuum did pledge to negotiate a PLA at that point.

Continuum is also reportedly raising objections to paying the prevailing wage for construction work. That took coalition negotiators by surprise given that Prosper Portland’s November 2017 description of the project—which Continuum based its bid on—said “construction work on the site is subject to Oregon Bureau of Labor and Industry (BOLI) prevailing wage rates.”

Prosper Portland Executive Director Kimberly Branam says that wording was potentially confusing, because only some parts of the project are actually subject to a legal requirement to pay prevailing wage. Oregon’s prevailing wage law applies to public construction projects and to public-private partnerships when there’s at least $750,000 of public money involved. Branam said Prosper Portland will be paying for demolition, site preparation, and infrastructure, and that work will be subject to prevailing wage requirements, and so would any housing that’s subsidized by the Portland Housing Bureau. [Portland Housing Bureau owns 16% of the USPS site, and plans to build 720 affordable housing units there alongside roughly 1,650 privately-funded market-rate units.] But Continuum would not be required to pay prevailing wage on the privately funded buildings it constructs on the site, Branam said.

Asserting that the whole Broadway Corridor development should be treated as a single project, Operating Engineers Local 701 asked BOLI to determine whether the prevailing wage law applies. But in a May 5 letter, BOLI said it can’t make that determination until Prosper Portland reaches a final development agreement with Continuum. BOLI said the prevailing wage requirement would apply to any site work that Prosper Portland pays for.

Whether or not it’s required to, coalition members say Continuum has voluntarily agreed that contractors will pay the prevailing wage on the “core and shell” of buildings, just not on all tenant improvements.

Branam says a deal has been reached with SEIU Local 49 covering janitors and security guards on the properties once the project is complete.

But on construction equity issues, the two sides appear to be at an impasse.

Branam said negotiations have been delayed by COVID, by a land use appeal over proposed building heights, and by the complexity of the project.

“Right now we’re trying to land four planes at once,” Branam said, listing the CBA; Prosper Portland’s final “development and disposition agreement” with Continuum; an intergovernmental agreement with the City bureaus in charge of roads, water, and sewer service; and the project’s master development plan, which must be approved by a design commission. “It’s a complicated Rubik’s cube.”

“We’re still at the table,” Branam said. “We’re all negotiating in good faith.”

The latest timeline calls for a CBA to be ready for a vote at Prosper Portland’s July 22 board meeting, followed by a City Council vote in August or September. Whether an agreement will be reached by then remains to be seen.

“At a time when we’re in a nationwide reckoning about the disenfranchisement of the African-American community, we think this is a prime opportunity for Portland and Prosper Portland to get development right,” Satterfield said.


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