Six Members of Portland City Council Vote Against ‘Citizen-Suit’ Third Party Enforcement of I Squared Franchise Agreement

The City Council heard testimony from dozens of Portlanders demanding accountability

FOR IMMEDIATE RELEASE 
Sept 9, 2026

Media Contact: 
Nick Caleb, Climate & Energy Attorney, Breach Collective, 541-891-6761, nick@breachcollective.org

PORTLAND, OR - On Wednesday, September 9, 2026, six City Councilors voted down an amendment proposed by Councilors Green and Morillo for a ‘citizen-suit’ third-party enforcement condition to the Zenith franchise transfer ordinance. This amendment would have granted community members the ability to bring legal action to enforce the franchise agreement or to seek damages for harmful violations of the Agreement.  A citizen-suit is a common legal tool that allows people to sue polluters to enforce environmental laws and regulations.  

Timestamp to video of the amendment discussion

Green and Morillo emphasized that the proposal would not impact the material operations of the facility or alter the substance of the franchise agreement. Instead, it served simply to ensure public confidence that the franchise agreement would be enforced, even if the Mayor abdicated this duty. According to the sponsors’ logic, I Squared -- the private equity company attempting to purchase Zenith’s facility -- should not take issue with the amendment if they plan to abide by the franchise agreement’s terms. 

In her remarks to City Council, Councilor Angelita Morillo, District 3 said: 

“For a buyer who has no intention of breaking the law, this provision doesn’t cost a dollar.”

The franchise agreement explicitly allows the inclusion of conditions related to the technical, legal, and financial qualifications of I Squared Capital to perform according to the franchise agreement as City Council “deems reasonably appropriate.” Green and Morillo explained the amendment was based on this clear delegation of authority to council. 

Dineen Crowe, Campaign Director at 350PDX said:

“This vote must be understood in context. The public has reason to doubt the City of Portland’s stewardship of this dangerous fuel storage site. The City has repeatedly failed to hold Zenith accountable for violations of the franchise agreement and illicit expansion of its dangerous fuel storage and throughput. More recently, records revealed the City apparently promised to “manage” public opposition to the transfer to I Squared. Actions like these simply erode public trust. And when the government fails, the public deserves a remedy.”

Nick Caleb, Climate and Energy Attorney at Breach Collective said: 

“The City Council had clear authority to act here and courts would defer to the City’s interpretation of what are reasonably appropriate conditions. The apparent unwillingness for half of the Council to even investigate the full extent of their authority is worrisome, particularly when the consequences of an accident or disaster at this facility would be catastrophic for Portlanders and our environment.”

After debate, the amendment failed 6-6. Councilors Clark, Zimmerman, Novick, Pirtle-Guiney, Ryan, and Smith voted against the amendment. These same six Councilors plus Council President Dunphy voted to move this item out of committee on August 22 even though the Mayor and City staff had not produced key documents related to the ordinance. After dozens of Portlanders testified in committee, the City Attorney suddenly declared that the concealed documents could now be released in the public interest.

Jordan Lewis, a volunteer lobbyist for the Portland Democratic Socialists of America said: 

“We are very disappointed in the City Councilors who voted against the third party enforcement amendment. This is two votes in a row that these Councilors have protected the interests of a fossil fuel company over the safety of Portland residents. It doesn’t seem like an incredible coincidence that these six councilors are all endorsed by the Portland Metro Chamber, an entity who strongly supports the expansion of dangerous liquid fuel infrastructure.”

This franchise transfer process has been riddled with irregularities including key documents hidden from the public, a lawsuit from Zenith Energy (apparently filed because too many people signed up to provide public testimony on the ordinance), public records suggesting the City and I Squared Capital were working together to “manage potential public opposition” to the transfer, and the City Attorney changing the rules mid-process by saying that approval of the ordinance only needs 7 votes at City Council after originally saying it needed 9.

I Squared Capital representatives testified in committee hearing and at City Council on Sept. 2 to attempt to distinguish their company from Zenith Energy. However, the facts indicate that I Squared’s operations will be a direct continuation of Zenith’s operations, including plans for expansion into a regional fuel hub. Section 10 of the City’s ordinance specifies that “ISQ intends to retain all facility employees that are currently employed by Zenith to maintain technical expertise at the facility post-sale.” According to Private Equity Climate Risks, “[t]he company claims to have an Energy Transition Strategy that ‘embraces the full breath of clean energy; however, 79 percent of the 19 energy companies in its portfolio are invested in fossil fuels, as of the end of July 2024.”

The second reading of this ordinance will likely be scheduled for next week.

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