PORTLAND — The city of Portland is like an addict that refuses to go into rehab and, like any other addict in denial, is also dragging down all those who care about her.
Population loss, vacant retail storefronts and foreclosed houses for sale throughout the city testify to a sickly economy and city administrators’ inability to incubate new businesses and attract and keep established ones.
The city has become willfully dependent on federal dollars to make up shortfalls in tax revenue and compensate for its economic sloth. Moody’s economic outlook for Portland forecasts a continuing decline in area jobs through 2011.
In 2001, Portland’s unemployment was 2.4 percent. Now at 7.6 percent, it is more than three times higher. Portland has lost 3,000 construction jobs over the past year. Its cost of doing business is 10 percent higher than the national average and the cost of living is 2 percent higher. Moody’s describes the city’s economic growth as “decelerating.”
Recently the City Council considered final allocations for social services and development projects in the annual gantlet for Community Development Block Grant (CDBG) funding. These funds, administered by the U.S. Department of Housing and Urban Development, go to states according to population in order to eliminate substandard housing, fund safety net services and stimulate job-producing enterprises for low-to-moderate (LMI) income households.
Since funding began in 1974, Portland has not funded a single project designed to create jobs and develop new businesses for LMI workers.
Rather, it has used CDBG dollars for social services triage and cosmetic fixes to buildings, sidewalks and streets — a kind of uplift bra to create the illusion of attractiveness and health — presumably for corporations considering relocation — and to minimize city layoffs.
Corporations expanding to new cities are far more interested in other attributes: Is there balance between corporate and residential tax bases? Is the work force skilled and educated? How have unemployment and social services expenditures grown? Is housing affordable for my work force and, if it is, does it reflect residential market stability or diminishing market value?
The owner of a 5,000-square-foot lot with a house near Maine Medical Center pays more than $7,000 in property taxes. A five-acre parcel with a house in West Falmouth is assessed $4,800. The difference is in Falmouth’s determination to balance its corporate and residential tax bases so that it attracts and provides incentives for new business.
A look at the CDBG program’s legislative history may explain city administrators’ apparent indifference to local economic realities. Of all measures used in determining how much a city will receive in CDBG funds, its poverty level is by far the most important, at least a third of its total score.
Healthy cities score lower and receive less aid. Sick cities therefore have every incentive to look sicker, increasing their CDBG payouts. In other words, Portland officials couldn’t care less about relieving the city’s poverty and unemployment. It is not in their interest to do so.
As a result of this tendency, economic development projects constitute only 10 percent to 12 percent of project allocations in cities and towns of fewer than 500,000 people.
Last year, $100,000 in CDBG recovery funds specifically earmarked for job creation bought a city-built bike trail through Bayside, where at least 40 percent of the population is in poverty.
Another 2009 “recovery” project spent more than $70,000 to install a new elevator at a watering hole for local politicians. One city councilor proposed that the city spend recovery dollars for a skate park.
Overall, city departments usurped 86 percent of 2009’s CDBG recovery development budget and 73 percent of its social services budget.
It is not rocket science to favor new job creation over mounting expenditures for basic needs programs that a healthy economy would reduce.
The city’s unemployment totals more than 15,000 people, nearly a quarter of its people. It is the state’s largest city with the highest concentration of skilled and professional jobs, yet at $809 per week its average wage is $11 less than that of the average Cumberland County worker.
Census figures for 2008 show that populations in poverty were driven deeper into extreme poverty by the countrywide economic crisis, particularly children under 18.
City officials have yet another opportunity to tend to the people’s business and fund real, long-term growth and job creation. But time is running out for bad-faith solutions without substance.
Portland taxpayers are sick and tired of being sick and tired. It may simply be time for these people to go.
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