Referring to it with happy little buzzwords such as “climate justice,” the city of Portland will soon be implementing the first (and hopefully only) “green new deal” carbon tax in the nation, which city “leaders” estimate will suck $60 million out of the economy. The money will allegedly be going toward “creating” “green energy” jobs. They say the tax will only affect The Evil Corporations™ specifically referring to Walmart.
The “Portland Clean Energy Community Benefits Initiative” was passed via ballot initiative in the 2018 election, when 173,000 people voted for it. It was originally projected to raise $30 Million. Now the city gets to see what they voted for.
Proponents, mostly local community organizations, said the benefits far outweigh any potential drawback, especially for communities of color — which they argue are disproportionately affected by climate change. The measure’s steering committee includes Verde, the Coalition of Communities of Color, the Asian Pacific American Network of Oregon and the Portland branch of the NAACP, among others.
Willamette Week reports today:
In just a few months, the city of Portland will begin investing the proceeds from a groundbreaking new tax on large companies.
“It’s a model for the rest of the nation,” Mayor Ted Wheeler said recently. “A beacon and a testament to our community’s belief in doing things a different way.”
The Portland Clean Energy Community Benefits Fund, or PCEF, will raise as much as $60 million a year from a new tax on big retailers. The money is supposed to supply clean, efficient energy and jobs to people the city has long slighted.
At its core, the concept transfers wealth from big corporations such as Walmart to low-income Portlanders of color. It’s a local version of the Green New Deal proposed in 2019 by U.S. Rep. Alexandria Ocasio-Cortez (D-N.Y.). It’s also part of a larger political effort to reshape who calls the shots—and who benefits—in America’s whitest big city.
Never has City Hall had so much money to spend with so few strings attached. The guidelines for spending the tax are squishy, as are the yardsticks for measuring the effectiveness of those expenditures.
“One of the biggest tasks facing this effort is, what are the key metrics of success?” says David Heslam of Portland’s Earth Advantage Institute, a supporter of the new tax. “They haven’t communicated that yet.”
That uncertainty concerns observers such as Maurice Rahming, an owner of O’Neill Electric, one of the city’s largest African American-owned contracting firms.
“What are the accountability means they are going to use to track outcomes?” Rahming asks. “At the end of the day, it’s about accountability and delivering on services.”
Oh, but it gets better. Remember the proposal to force building owners to provide space for the homeless vagrants? The woman behind that, Oriana Magnera, is the same one who peddled this unicorn fart climate utopia tax!
Last month, the City Council made some last-minute adjustments to the new tax, exempting some companies, including national waste haulers and construction firms, leaving large retailers such as Walmart, Target and Home Depot to pony up.
On Dec. 12, while considering those tweaks, the council got a warning from Oriana Magnera, a spokeswoman for the coalition that put the measure on the 2018 ballot.
“These exemptions take money out of the hands of black, indigenous and other communities of color and put it instead in the pockets of corporations,” testified Magnera, who works for Verde, a social justice nonprofit active in passing the ballot measure and making preparations for deploying the money. “We will fight fiercely if any future erosion occurs.”
Magnera and her fellow advocates face both an unparalleled opportunity and a daunting responsibility: to spend the new money transparently and well.
Oh, and to make this even more comically tragic, Portland had tried a watered-down version of this several years ago, relying on Obama stimulus money. And, shockingly, it failed in spectacular fashion!
For all the talk about how new and innovative the Portland Clean Energy Fund is, the fact remains that the city tried something similar before—and not that long ago.
The promise of energy efficiency is seductive: Insulate walls, caulk some leaks and tune up the heating system, and the savings on utility bills will exceed the costs of the work.
If anybody could have made an energy efficiency nonprofit thrive in Portland, Tim Miller seemed to be that guy.
He had the pedigree: a degree in economics and industrial engineering and an MBA from Stanford; five years at Intel; and a couple of decades doing green energy consulting before he signed on in 2012 at a Portland outfit called Clean Energy Works.
Clean Energy Works snagged a $20 million federal stimulus grant in 2010 and became an independent nonprofit whose mission was to deploy minority contractors to make 100,000 homes energy efficient.
“Our model was to retrofit,” Miller says. “The idea was to create jobs now—and let’s have them be good jobs.”
The program aimed to benefit underserved communities—just as the new tax does. “From the beginning, equity advancement was a hallmark of the program—promoting worker diversity and career pathways into the energy sector, as well as development of contractors including minority- and women-owned firms,” Clean Energy Works said in a grant application.
The similarities to the Portland Clean Energy Fund extended to granular details such as pay: Both programs specified workers should get no less than 1.8 times minimum wage.
Clean Energy Works conducted energy audits—and then, for a fee, referred homeowners to contractors for retrofits. “The feedback from the homeowners was almost universally positive,” Miller says. “People said, ‘We’re more comfortable in homes and we save money on our bills.’”
But Clean Energy Works’ services were expensive.
The Energy Trust of Oregon, a nonprofit funded by utility ratepayers, found the program’s costs “significantly” higher than those of other contractors doing similar work without public funding.
Miller acknowledges Clean Energy Works was more expensive, but he says the nonprofit’s holistic approach provided significant intangible benefits.
By 2014, Clean Energy Works had spent the $20 million in federal stimulus money it received four years earlier. It then secured an additional $10 million state grant to keep going.
But it could never generate significant revenues from its contractor referral service—and when the state grant ran out in 2016, tax records show, Clean Energy Works began recording large operating losses.
“An energy efficiency-based program could not support itself,” Miller says.
Although Clean Energy Works hoped to weatherize 100,000 homes, it only completed about 5,000.
Yet Miller judges the effort a success. “You got thousands of homes retrofitted, hundreds of jobs created, dozens of contractors, a ton of awareness,” Miller says. “It was money well spent.”
The article goes on to include:
[Proponents say] PCEF can thrive where the nonprofits they ran could not because the program won’t be measured by the strict financial metrics that utility-funded projects are measured by. Instead, PCEF projects can focus more on less easily measured health and climate benefits.
That’s right, they will consider it successful if we just ignore all economic reality. Speaking of economic reality, an even earlier version of this was attempted, and it also failed, to the surprise of no one. Even more predictable, dude took the money and ran.
In 1979, a new nonprofit called Portland Energy Conservation Inc. spun off from the city of Portland’s energy office. The nonprofit performed energy audits and weatherization retrofits, building up a national customer base.
By 2010, PECI employed 300 and even put its name in neon on the exterior of a downtown Portland high-rise, a bold move for an Oregon nonprofit. But PECI’s revenue declined precipitously from 2011 to 2014, and that year the nonprofit sold its business to CLEAResult, a for-profit Texas company.
PECI executive director Phil Welker chose to bank the $7 million in proceeds from that sale rather than stay in the energy efficiency business.
Welker has retired to Utah, replaced by Tim Miller, the former Clean Energy Works leader, whose task now is to give PECI’s money away.
You couldn’t script a wackier story. Dude gets millions of dollars in public money to start the greenie organization, it failed, so he sold off what was left and retired with $7 Million. No wonder these people promote such “plans,” they know they get paid no matter what. And Portland voluntarily voted for this.
So how exactly will the latest scam work? The article explains:
THE NEW TAX: Big retailers, with revenues of more than $500,000 in Portland and $1 billion nationally, pay a 1 percent surcharge on their Portland sales. The city estimates the tax will raise $44 million to $61 million annually. The city keeps 5 percent for administration.
WHO GIVES IT AWAY? City commissioners each selected one member to serve on the grant committee; those five members then picked four more. The committee chooses which grants to award, and their recommendations must be ratified by the Portland City Council. Committee members may not direct money to their own organizations. (See list of committee members below.)
WHO GETS THE MONEY? Nonprofits, working alone or with partners. One-fifth of the money must go to groups with a history of working with “economically disadvantaged” Portlanders. All workers must be paid no less than 1.8 times minimum wage.
MEMBERS OF THE GRANT COMMITTEE: Shanice Brittany Clarke, Portland Public Schools; Faith Graham, Network for Energy, Water, and Health in Affordable Buildings; Andrea Hamberg, Multnomah County; Michael David Edden Hill, journeyman electrician; Megan Horst, Portland State University; Jeffrey Moreland Jr., general contractor; Maria Gabrielle Sipin, transportation planner; Ranfis Villatoro, BlueGreen Alliance; Robin Wang, Ascent Funding
If something has a history of failing, leave it to Portland to keep doing it bigger!
And, oh yeah, as Mayor Ted Wheeler’s reelection campaign picks up, he and his wife are splitting.