The 13 ballot proposals Portland voters will consider this fall could cost the city more than $6.5 million to implement, according to a new fiscal impact note from the city manager.

The analysis, which was requested by Mayor Kate Snyder and will be presented to the City Council Monday, estimates the Charter Commission proposals would cost the city $1 million, and five citizens’ initiatives would result in more than $5.5 million in costs and lost revenue.

Most of those costs – or revenue losses – would be yearly, though the note says about $250,000 are one-time expenses for renovations required to accommodate new employees.

The estimates are based on current staffing levels, pay grades and construction and material costs. If the proposals are implemented, the new costs and revenue losses would drive up the property tax rate by $0.44, or 3.4 percent. The city currently has a $269 million municipal budget and a $133 million school budget.

A Portland homeowner with a home valued at $365,000 would pay $161 more in property taxes per year, according to the note from interim City Manager Danielle West.

“We’ve tried to be as neutral as possible and just provide the factual data on the costs we see,” West said in an interview. “Staff worked really hard on putting this together … We do see both sides of the coin and hopefully it will be helpful in responding to what the mayor requested and keeping everyone educated.”

Snyder said Friday she plans to read the memo over the weekend and comment on it at Monday’s council meeting.

Regardless of what voters decide, West said she and city staff will work to come up with a responsible budget next year. That budget is already likely to face challenges as the city tries to reduce reliance on coronavirus relief funding and, like other cities, faces challenges with employment and higher costs for things like fuel and construction.

“We always can work on addressing unexpected costs or any costs that arise through the budget process and if these were to pass, I’m sure the council and the finance committee and staff would jump right in to do that work,” West said.

QUESTION E IS COSTLIEST

Of the 13 proposals voters will consider on Nov. 8, Question E, a proposal to restrict cruise ship activity, would be the costliest. The report estimates the city would lose $3 million each year under the proposal from the Maine chapter of the Democratic Socialists of America’s Livable Portland campaign.

The DSA is behind four of the five citizens’ initiatives, though the group has walked back support for Question E since agreeing to a compromise that it hopes will be taken up by the City Council.

The compromise, which was brokered with the International Longshoreman’s Association and Maine State Building & Construction Trades Council, aims to reduce cruise ship emissions and preserve jobs on the waterfront. It doesn’t include the per-day cap on passengers disembarking that’s included in the ballot question.

Cruise ship activity in Portland generates revenue through head taxes and infrastructure fees paid by each ship that docks and disembarks. In the years just before the pandemic, ships carrying over 1,000 passengers paid a total of about $2.8 million a year in taxes and fees.

City staff estimated that between 2024 and 2028, cruise ship revenue would average $3 million a year, but all of that would be lost under the proposal.

“Beyond that direct loss, the required cancellation of port visits by cruise ships carrying more than 1,000 passengers is likely to have a significant impact on the Portland economy: many businesses and individuals, including artists, vendors, stores, and the working waterfront rely on cruise ships for support,” the note states.

OTHER QUESTION COSTS 

The analysis estimates a cost of $127,500 for Question B, the DSA’s proposal to restrict short-term rentals, and $175,000 for Question C, which seeks to enhance tenant protections.

The $127,500 for Question B represents a loss of registration fees. The proposal would limit short-term rentals and nearly eliminate non-owner occupied units – there would be one, limited exception for two-unit buildings.

The cost for Question C (tenant protections) includes two staff members and $25,000 to renovate office space in City Hall to accommodate the additional employees.

Former Mayor Ethan Strimling, a member of DSA and the Livable Portland campaign, said Friday he was happy to see the city planning for additional enforcement staff, and for the cost of increasing wages for city workers included in Question D’s proposal to raise the minimum wage to $18 per hour by 2025. Question D would also get rid of the tip credit or sub-minimum wage that would allow employers to pay tipped workers less than the minimum wage.

“It’s good to see the city committing to enforcement of these initiatives and to paying workers better,” Strimling said. “That’s key to making the city affordable. If we continue with the policies we currently have, we will lose a generation.”

But Strimling and Wes Pelletier, who chairs the Livable Portland campaign, also said they want to see more information on the city’s calculation for Question B. Strimling said he expects that proposal, which includes a revised fee structure for short-term rentals, would bring in more revenue, not less.

And he said a proposed $25,000 fee to convert a rental unit to a condo contained in Question C would help offset costs.

Further information on the city’s calculations for Question B was not available Friday afternoon. The city approves about four condo conversions per year – currently with a $150 fee, according to city spokesperson Jessica Grondin, who said the city has concerns with the proposed $25,000 fee.

“Fees must be tied to a program, and so this raises legal concerns as it seems intended to be punitive,” Grondin said in an email. “There’s no guarantee of receiving this money.”

Opponents Friday cited the costs as a reason for voters to reject them.

“At a time when the price of everything is going up, the last thing we need is another increase in property taxes – and that’s exactly what these ballot questions would lead to,” Tom Allen, chair of Protect Portland’s Future, a group primarily opposed to charter commission Questions 2 and 5, said in a statement.

“It doesn’t matter if you own or rent, if they pass you’ll be paying more to live in Portland,” Allen said. “With so many people struggling we should be thinking about ways to make the city more affordable, not more expensive.”

COMMISSIONERS CRITICIZE REPORT

Advocates of the charter commission’s proposals, meanwhile, were critical of the city’s report.

Yes for Democracy, a group made up of former charter commissioners and others who support the commission’s eight proposals, said in a statement Friday that while there is educational value to the estimates, they worry that they could be used as a political tool to stop the proposals from passing.

“By lumping all questions into a bottom line price tag, we fear that this report is biased toward inflating the total cost of the charter questions and painting the charter commission as fiscally irresponsible,” the statement said.

Yes for Democracy, whose president is former Commissioner Zack Barowitz and whose members also include former commissioners Pat Washburn and Catherine Buxton, said some of the costs attributed to the commission’s proposals “appear to be inaccurate, speculative or actually negligible.”

They did their own calculations, estimating the charter commission’s proposals would cost $500,000 – half what the city’s report totaled – and said the cost to the median homeowner would be about $12.

Buxton, in an interview Friday, said she thinks the cost estimates are useful, but she would also “caution voters against a lot of hand wringing” over what amounts to a small percentage of the city’s overall budget.

“The governance proposal in my opinion is a move towards making the government more accountable to the electorate and towards decisions that are being made by folks we vote for,” she said.

The charter commission’s governance proposal – Question 2 – would change the structure of city leadership and is estimated to cost about $398,000 under the city’s analysis, making it the most expensive of the commission’s proposals.

Those costs include $75,000 for a special election, though Yes for Democracy noted that such a cost would only be necessary if there was an unexpected vacancy in an elected office. “These are not guaranteed yearly costs and feel inaccurate to include,” the group said.

The city’s analysis also includes $150,000 for renovations to council chambers to accommodate a larger City Council, which under the proposal would increase from nine members to 12. The report has several notes saying both the commission proposals and citizen questions would require renovations of City Hall to accommodate more staff.

“We question whether those changes are needed and whether it is impossible to adapt existing space and equipment,” Yes for Democracy said.

The commission’s final report calls for at least two positions for the proposed civilian police review board – the city budgeted those as two full-time positions – but the report also states that it would be up to the City Council to determine whether the positions would be full or part time and if some duties could be assigned to current staff.

Yes for Democracy said Friday that the positions could likely be filled with part-time or existing staff.

Three of the charter commission proposals – Question 1 (the amendment to the preamble), Question 4 (proportional ranked-choice voting) and Question 6 (codification of the Peaks Island Council) – would not have significant costs and were not included in the memo.