NE Portland’s Cully neighborhood fights displacement, climate change with urban renewal. But will it work?

All around her, Chach Heart sees aging roofs and peeling siding. Nearby, decades-old water-damaged trailers line row after dilapidated row.

Heart’s move into a manufactured home had been a necessity when she lost her job and could no longer afford the mortgage on her house.

She was glad to stay in the Cully neighborhood that had charmed her with its old Portland-style and community feel when she first moved there nine years ago, but disrepair can make mobile home park residents vulnerable to development and extreme weather.

Now Heart and many others like her in Northeast Portland’s biggest neighborhood are banking on a grand — and potentially risky — experiment to maintain Cully’s affordability while fixing it up and preparing it for a future of living with climate change.

To do that, they’re turning to urban renewal, the same mechanism responsible for decades of massive displacement in Portland.

But unlike past urban renewals, this one shuns large infrastructure projects such as light rail expansion or street improvements and instead makes low-income families and people of color the main beneficiaries.

Even though it will help drive up housing values, supporters hope the money will stabilize families in their homes and small businesses in their storefronts by funding weatherization and repairs that make them more resistant to extreme weather, especially in a neighborhood beset by existing pollution and low-quality housing stock.

At the same time, the urban renewal district will spur the building of affordable homes and apartments with an emphasis on green standards and energy efficiency.

In this 2006 file photo, a child walks across the Arbor Mobile Home Park in Cully, a neighborhood in Northeast Portland. Starting in the summer of 2023, residents and community organizers plan to use urban renewal to maintain Cully’s affordability while fixing it up and preparing it for a future of living with climate change.Jamie Francis/The Oregonian

“We asked, ‘What if we could use the same tool that caused harm to instead repair that harm?” said Maddie Norman, a coordinator with Living Cully, the local coalition that helped launch the district. “What if the tool itself is neutral, but the way it’s been used in the past created the problems?”

The Cully urban renewal district will officially launch this summer by freezing property values in the neighborhood, allowing the city to borrow up to $350 million over 30-plus years to make public improvements and then repay the debt using the increase in property taxes from the growth.

It will be the first urban renewal district that springs from community organizing – not city planners – and the first to operate with strong resident input and oversight from the start.

Mark Graves/The Oregonian

For Heart and others, urban renewal money could help repair mobile home parks and turn them into resident-owned cooperatives, bolstering their investment and protecting against landlords raising the rent or the property going on the selling block.

“A lot of homes in the mobile parks are from the ‘60s and ‘70s,” Heart said. “They have old single-pane aluminum windows, some have asbestos and scary electrical wiring. Many don’t have air conditioning. And every time we get a windstorm, I swear I hear someone’s metal roof tear off.”

Residents and activists are optimistic their new take on urban renewal will work because Cully has for years been a hotbed of grassroots organizing. And, the coalition behind the effort has a track record of accomplishing innovative development projects with the help from neighborhood residents and business owners.

They hope the plan will improve people’s quality of life and ability to live with climate change, allowing residents to build equity in their homes and offering opportunities for others to buy or rent places that don’t strain their budgets.

But some experts believe Cully’s aspirations aren’t realistic. They say it will be difficult, if not impossible, to keep a lid on home prices and rents. And, they argue that the urban renewal formula counts on gentrification and the accompanying rising property taxes to pay the bond bills.

“I worry that urban renewal has a really strong signaling effect. It says we’re going to come and invest money here, we’re trying to make things happen here,” said Lisa Bates, an associate professor of planning and urban studies at Portland State University.

“It draws private development that might have gone elsewhere,” she said. “And that’s the point. But you don’t always get to pick who answers that call.”

DEVELOPMENT PRESSURE

For years, Cully – now home to about 13,000 people – has drawn those seeking affordable rents and homes. Lagging city investment, industrial pollution and notorious landmarks like the Sugar Shack strip club had kept rents and mortgages low.

Cully purchase

Living Cully, a group of community groups and nonprofits in Portland, purchased the former Sugar Shack property, a 2.19-acre parcel that housed several adult businesses, including strip clubs, a restaurant and adult video store. The 1950s cinderblock building was purchased for $2.3 million. Kristyna Wentz-Graff/Staff LC- The Oregonian/Oregonlive.comLC- The Oregonian/Oregonlive.com

As one of the last neighborhoods annexed into Portland in 1985, it lacks paved roads, sidewalks, bike lanes or community centers.

Glass-recycling and asphalt-grinding plants along the neighborhood’s northern edge pump out nitrogen oxide, arsenic and lead. Diesel emissions flow in from Columbia Boulevard, U.S. 30 and Interstate 205, as well as nearby Portland International Airport and the east-west freight line.

The neighborhood also has three brownfields, previously developed industrial land that could be contaminated.

Still, Cully’s six mobile home parks and several large affordable apartment complexes offer some of the city’s least expensive housing. And a slew of organizations serve the neighborhood’s seniors, immigrants, refugees and other low-income residents.

As of 2000, the mostly white neighborhood shifted to a much more diverse population – about half of the residents are people of color, with Latinos making up the largest group, followed by Black people.

Mark Graves/The Oregonian

In 2012, the City Council approved a series of micro-scale urban renewal districts – dubbed the neighborhood prosperity network – focusing on two commercial hubs in the neighborhood to help businesses upgrade and thrive.

But the move did little to help Cully residents squeezed by rising housing prices taking hold across Portland. At the time, more than a third of the people in a swath of Cully lived at or below the federal poverty level, census figures show.

Recognizing the economic pressures at play, four local nonprofits – Verde, Habitat for Humanity Portland Region, Hacienda Community Development Corp. and the Native American Youth and Family Center – formed Living Cully, a neighborhood coalition that would fight to keep Cully affordable.

In 2015, Living Cully bought the Sugar Shack property to build green affordable housing. The following year, the group bought Oak Leaf Mobile Home Park after its residents discovered the owner was planning to sell it to a developer. Another nonprofit took over and renovated the dilapidated homes.

Two years later, the coalition unveiled Cully Park, developed on a former landfill. The organization also forced a local glass-recycling plant to agree to install pollution filters by 2024.

Hacienda CDC transformed the former Sugar Shack site into Las Adelitas, a 142-unit housing complex for people of color and low-income households. And NAYA built three affordable housing developments for Native American Portlanders and other low-income residents.

Cully urban renewal

Nesika Illahee, meaning “Our Place” in the Chinook language, is an affordable housing development in Cully that was built for Native American residents by the Native American Youth and Family Center. The nonprofit group is part of a local coalition that’s working to launch an urban renewal district in the Northeast neighborhood this summer to help stabilize local residents and small business owners. Beth Nakamura/The Oregonian

Despite such efforts, housing prices in Cully have continued to climb and newly constructed duplexes and townhomes have brought an influx of middle-class residents.

Elizabeth de Jesus, a Latina mother of three who has lived in Cully with her husband for 16 years, said the changes make some lower-income or immigrant families feel unwelcome.

“The new housing has brought in people with more money,” said de Jesus. “I don’t want my children to grow up thinking that they are less.”

Listening to people like de Jesus made Living Cully leaders realize they needed a lot more money to prevent the displacement of local families. That’s how they came to consider urban renewal – but in a different way.

JOINT LEAP OF FAITH

Living Cully has held hundreds of focus groups and talked to 500 residents, including de Jesus, who led an engagement group for Spanish speakers.

They discussed how urban renewal – including the expansion of Legacy Emanuel Medical Center, the revitalization of Alberta and Mississippi streets and the light rail expansion in the Interstate Corridor – decimated Black neighborhoods, leading to evictions, the demolition of homes, businesses and churches, and the dissolution of long-standing communities.

MORE: A Mixed Record on Urban Renewal

Cully leaders explained that changes in urban renewal rules now require that at least 45% of the money must be set aside for affordable housing.

The city also can no longer use eminent domain in urban renewal to evict people and take their homes and land. And renewal plans must use an equity lens when deciding how to spend their dollars.

Residents and community organizers together with city staff explicitly narrowed down who would benefit – and how – from investments in Cully. For the first time, urban renewal would help those most vulnerable to losing their homes and jobs, including Black, Indigenous and other people of color, immigrants, renters, mobile home park residents or those experiencing homelessness.

“I’m cautiously optimistic and inspired that we created something very unique,” said Heart, who helped mobilize other mobile home park residents to explore urban renewal. “The city has a long history of urban renewal being harmful to marginalized communities. But this plan came directly from the people that are most impacted.”

They also wrote a governance document spelling out accountability measures. That includes a 13-member Community Leadership Committee made up of Cully residents to advise Prosper Portland, the Housing Bureau and the City Council on how to carry out the urban renewal plan – although the city has final say in funding decisions.

The committee and city will write five-year action plans to select investments and make sure the intended communities are benefitting. The committee can recommend ending the urban renewal district if members don’t think it’s working.

Cully urban renewal

Northeast 42nd Avenue near Northeast Killingsworth Street in Portland’s Cully neighborhood. Beth Nakamura/The Oregonian

To Prosper Portland, the city’s economic development agency, the Cully project offers a new direction from past inequities.

“It’s fair to say it is like a joint leap of trust, to do this project together,” said Lisa Abuaf, director of development and investment at Prosper Portland,

“We can’t stop market forces,” she said, “but we can be intentional about where public money goes. In this case, first and foremost to stabilize.”

CLIMATE RESILIENCY

The innovative approach at the heart of Cully’s urban renewal was a hard point to swallow for some residents eager to see immediate and visible neighborhood improvements.

“We said to them, ‘Yeah, we know you need sidewalks, we know you need bike lanes, we know you need better transit. But you also need to know that if you get those things before you have housing stability, it might cause you to be displaced,” said Norman, the Living Cully coordinator.

The Cully district might eventually fund smaller infrastructure projects – such as a community center, a food-cart pod or affordable housing – though this won’t happen for at least five to 10 years. Newly built affordable housing would be open to all Portlanders, not just Cully residents.

Initially, the money will be spent on weatherizing existing homes, including installing energy-efficient insulation, doors and windows, heat pump air conditioners and high quality air filtration HVAC systems in both rental and resident-owned homes.

Grants and loans also will be available for local business owners to do the same.

Cully urban renewal

After a devastating fire gutted her small Laotian restaurant, Cully Central, owner Ae Sangasy, 46, received grants to remodel her business space through a micro-urban renewal district in Cully, the Northeast Portland neighborhood where half the residents are people of color. The program will expand this summer with the launch of a new urban renewal district that will focus in part on stabilizing businesses. “Cully looked like a promising place, welcoming and with a lot of potential,” said Sangasy, who left Laos for the U.S. as a child. “And the resources and funding I received were the reason why I stayed. Cully might not be the perfect neighborhood right now, but I want to be part of the pioneers who make it better.” Beth Nakamura/The Oregonian

Some of the initial money will also go to buy buildings or land, Norman said, such as buying a market-rate apartment complex and converting it to affordable housing, helping mobile home park tenants become cooperative owners or banking land for future housing development or in-fill housing.

New housing will be modeled on projects such as Las Adelitas. Named after feminist Mexican revolutionaries, Las Adelitas – which welcomed its first residents earlier this month – boasts rooftop solar panels, electric vehicle charging stations and an EV car-sharing program, energy-efficient electric appliances, green roofs, ductless heat pump air conditioning and native and drought-tolerant landscaping.

“We’re going to push the limit beyond the minimum standard for green buildings,” Norman said, “to ensure that if people are going to live in a neighborhood like Cully where they’re exposed to more pollutants than in other parts of town, their homes and the businesses they frequent will be able to minimize those environmental impacts.”

CAN IT WORK?

Many residents and planners are cautiously optimistic the Cully plan will slow gentrification – though they’re aware market forces and private developers are beyond urban renewal’s control.

“We can’t make a wall against the market, but we can create this wall of community by saying we have a voice in this. We can come together and sometimes we can push back,” said Annette Pronk, a longtime Cully resident who also works for Habitat Humanity.

Cully urban renewal

Annette Pronk, 59, a longtime Cully resident and the daughter of immigrants from Indonesia, lives on a small block of energy-efficient affordable homes built by Habitat for Humanity, a nonprofit long involved in anti-displacement work in Cully. After moving to the neighborhood, Pronk got a job with Habitat and has since advocated for Cully to remain affordable and diverse – including through use of urban renewal. “My dream is that the kids who grow up here can come back and buy a house here,” Pronk said. “If we create the stabilization for our priority communities, they will feel represented here and they can build an attachment. I want them to know Cully is their place, and that home is home.” Beth Nakamura/The Oregonian

But PSU’s Bates – who in 2013 wrote a city-commissioned study on gentrification and displacement in Portland, including an analysis of the Cully neighborhood – said she isn’t sure the plan can work.

The innate mechanism at the heart of urban renewal makes it challenging, if not impossible, to keep a community affordable, Bates said.

“How could this tool possibly have an anti-gentrification impact if it literally requires property values to go up in order for it to work?” she asked. “That’s where the money comes from. That’s what the tax increment is.”

Bates said Cully should look to the current Interstate Corridor project, the city’s largest urban renewal area, as a recent lesson in how hopes for halting displacement can go awry.

When it launched in 2000, Bates said, the project was dubbed a revitalization plan that would support local businesses and stabilize longtime residents. It included a community process, an equity plan, an emphasis on supporting low-income and Black families and a large coalition of nonprofits working to create the plan and guide its implementation.

Despite multiple advisory committees, the city canceled urban renewal funding for the anti-displacement projects and home ownership initiatives, focusing only on building the Yellow MAX line, Bates said. Eventually, a second round of community organizing forced the city to refocus remaining urban renewal money on racial equity, including setting aside 70% of the funds for affordable housing.

The Interstate Corridor project also revealed the limits of community involvement in urban renewal districts, Bates said. After an initial burst of participation, residents tap in and out over the decades and some nonprofits move on to other issues or disband.

“It’s just really hard to continue to fight … to continue that level of energy and attention,” said Bates, who sat on the Interstate Corridor district’s housing policy advisory committee.

What’s more, urban renewal plans are subject to the political whims of a City Council that can change with elections. And Prosper Portland’s five-member, volunteer board of local citizens isn’t elected but appointed by the mayor and approved by council, meaning less accountability.

Another limitation: Residents, nonprofits and the city can’t match the money, time, and access to properties that real estate development firms have.

“You’re going up against some really tough headwinds if you’re trying to stop capitalism from working in the real estate market,” Bates said.

City leaders believe they have addressed some of these issues.

“When we look back at Interstate, we’re trying to use lessons learned to put in place as many tools and committed partnerships with the Cully community to make sure what happened in Interstate doesn’t happen again,” said Abuaf, the Prosper Portland director.

Organizers in Cully will soon ask the City Council for money to pay for permanent staff that will work with the neighborhood’s leadership committee to keep residents engaged long-term and help connect them to urban renewal funding.

Ultimately, urban renewal represents a last hope for many residents – and their children – to stay in the neighborhood.

Cully urban renewal

Gary Hollands, 46, moved to Cully as a 5-year-old and has lived in the Northeast Portland neighborhood for more than four decades, witnessing the influx of new immigrants from Latin America, Africa and Europe and the shrinking of his own Black community. Hollands hopes Cully’s new urban renewal district will help residents build a youth-focused community center on the vacant site of the former Whitaker School, a majority-Black school he attended as a child. Urban renewal “was a community-led act,” Hollands said. “When we looked at the historical districts, we saw the possibility of people getting pushed out. We addressed it by identifying who this was for, our priority communities.” Beth Nakamura/The Oregonian

Gary Hollands, a long-time Cully resident and the owner of Interstate Trucking Academy, said he hoped urban renewal would help Cully retain its diverse feel and bring back the once vibrant Black community he grew up in. He now dreams of this for Cully:

“To have the most diverse neighborhood in the city of Portland, with the amenities that we all deserve, like affordable housing, wealth creation through jobs, community centers where our kids can play and learn, and good educational facilities.”

It means, he said, “having African Americans moving back and having a healthy Latino, Native American and Asian-Pacific Islander population.”

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