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Portland plaintiffs win public records fight against Southwest Neighborhoods Inc.

PMG FILE PHOTO - A cyclist rides past the Multnomah Arts Center building in Southwest Portland, where Southwest Neighborhoods Inc. leases space from the city of Portland. A Multnomah County Circuit Judge ruled Friday, March 25 that a nonprofit coalition representing neighborhoods in Southwest Portland should have complied with Oregon public records law.

The ruling could mean that all district coalitions in the city are required to disclose their business with the public.

During a summary judgement hearing, Judge Jerry Hodson ruled in favor of plaintiffs Marie Tyvoll and Shannon Hiller-Webb, who sued Southwest Neighborhoods Inc. (SWNI) in 2020 when the public benefit nonprofit district coalition failed to respond to a request for copies of past email correspondence and other documents. Tyvoll and Hiller-Webb asked for the records when they suspected financial impropriety within the coalition had lingered following an embezzlement nearly 10 years prior.

At the time, Tyvoll was president of the Hillsdale Neighborhood Association and Hiller-Webb was president of the South Burlingame Neighborhood Association, which she still leads. Both neighborhood associations were among the 17 previously under the umbrella of SWNI.

"This is transparency for the taxpayers. This is transparency for the people of Portland," Hiller-Webb said after Judge Hodson's ruling. "Ultimately, it's our tax money being used. We should be able to audit organizations when questions arise. We paid for those records to exist, and we should have access to them."

District coalitions like SWNI more or less serve neighborhood associations, acting as intermediaries between neighborhoods and the city of Portland. Up until March 2021, SWNI was one of seven formally recognized coalitions in Portland and one of five that received a city contract and funds each year from the Office of Community and Civic Life to provide administrative services and conduct public outreach on behalf of neighborhood associations.

While district coalitions receive the bulk of their funds from those city contracts, their roles and responsibilities to the public have been somewhat fuzzy.

In his ruling, Judge Hodson said because of its nature and funding structure, the Southwest Portland district coalition was the functional equivalent of a public body and should have complied with the public records requests at the time.

"Portland residents can create autonomous organizations within a geographic boundary and obtain formal recognition by the city," Hodson said. "These groups fall into the classification of neighborhood associations and district coalitions. Both allow residents to weigh in on issues affecting the livability and quality of their neighborhood. The difference is that a coalition encompasses a larger geographic area and therefore it contains several neighborhood associations and from my perspective, as argued by the plaintiffs, is performing a key government function in communicating with its citizens — that is neighborhood associations — to the point in which the city has entered into taking over that role in a number of instances."

Hodson noted that district coalitions are contracted by the city to provide services that are built into the city's functions. The coalitions currently have one of two formats — independent private nonprofits, or city-staffed offices.

SCREENSHOT - Attorneys Alan Kessler (left) and Simon Whang appear for a virtual court hearing with Multnomah Circuit Court Judge Jerry Hodson (right) presiding.Hodson's ruling is likely to have major implications for the other private, nonprofit district coalitions in Portland. While the judge kept his focus on just the coalition involved in the lawsuit, he acknowledged the likelihood that others operate in a similar capacity with similar obligations.

Simon Whang, an attorney for SWNI, argued district coalitions that are private, nonprofit public benefit corporations have no government employees and shouldn't count as public bodies. At the time of the records request in 2020, SWNI received roughly 85% of its annual funding from its contract with the city, Whang noted.

"There are many, many instances in which there are private entities and nonprofits that receive funding from government, but they don't magically transform into public bodies," Whang argued, noting district coalitions like SWNI don't pass the "smell test" of a government agency. Whang also said SWNI should be exempt from providing the records because it no longer operates as a city-funded coalition and doesn't have staffing.

But in this case, the question wasn't whether Portland's private, nonprofit district coalitions are public bodies, but whether the nature of their operations makes them subject to Oregon's public records laws.

"SWNI was created because of the district coalition system embedded in city law," Alan Kessler, attorney for plaintiffs Tyvoll and Hiller-Webb, said during the hearing. "The function assigned to the entity goes to the core of democracy. It is a primary government function for the government to communicate with the public its policy intentions and its actions."

Oregon's public records law dictates that government agencies and quasi-governmental agencies that receive public funds and operate on behalf of the public, must make their communications and correspondence available for public inspection.

Since the 2020 filing of the public records lawsuit, SWNI's city contract was pulled and the city cut ties with the organization officially in March 2021. Portland City Commissioner Jo Ann Hardesty cited a forensic audit, which concluded SWNI hadn't done enough to ensure the proper use and expenditure of its city funds.

Since then, the city's Civic Life bureau has taken over most of the functions previously performed by SWNI.

"Just because SWNI no longer operates, doesn't mean the records it created when it was doing the public's business, don't belong to the public," Kessler added.

Tyvoll, one of the two plaintiffs in the case, initially appealed to the Multnomah County District Attorney's Office when SWNI ignored her records requests in March 2020. Former county D.A. Rod Underhill dismissed the appeal, initially conflating district coalitions with neighborhood associations, but reconsidered when Tyvoll noted a distinction between the two. The D.A. re-examined but still dismissed it, calling it a "close call."

Tyvoll and Hiller-Webb then decided to jointly file a lawsuit.

The two say the nearly two-year process of seeking accountability and transparency has come with heavy consequences, including harassment from those challenging their efforts. They also say the issues they encountered are indicative of a larger problem within Portland's governing structure.

"Because the neighborhood associations have been the only way to work with the city, it has become a target for white privileged folks to bully out minority opinions," Tyvoll said. "The way the current system is structured, for me, it perpetuates and enables white privilege."

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