Business developers envision the Bend Central District as a buzzing hub of apartments, condos and townhouses, blended with various businesses and walkable and bikeable streets. As that vision begins to sprout, the future of core services relied upon by unhoused people in the area — and where those people will go — is not as clear.

At the heart of the central district, the former industrial zone just east of the Bend Parkway, there is a 60-bed low-barrier homeless shelter and the facility where people return cans and bottles for a deposit, the BottleDrop Redemption Center. Business leaders are pushing for the facility to be moved, while a development including Bend’s new city hall, housing and a public plaza will replace the Franklin Avenue Shelter, or the former Rainbow Motel, in the coming years.

A handful of central district developments, including housing and commercial, are on hold as builders wait for interest rates to drop, inflation to ease and the city to complete promised transportation projects linking the district just east of the Bend Parkway to downtown. Those are partially funded with money generated by an urban renewal district in the city’s core area, which was created in 2020 but has seen slow growth since then due to the lack of building.

But business leaders say homelessness is another barrier to development.

Tod Breslau, an early investor in the central district, owns the Campfire Hotel, a boutique midcentury motor lodge, and serves as the vice president of the Bend Central District Business Association. According to Breslau, the hotel has had problems with people trespassing on the property late at night to search for cans.

“It’s been our biggest challenge. It’s hurting our business, it’s hurting our reviews,” he said. “This all needs to go away if the city wants a nice BCD.”

“We hope there’s going to be solutions for our unhoused population that doesn’t include 20 tents along the sidewalk,” he added.

He said homelessness in the central district seemed to increase in 2024 — that is until heavy-handed construction began on Second Street, an urban renewal project promising sidewalks, lighting and safety.

According to Breslau, part of the reason why homelessness has affected businesses is because of the BottleDrop Redemption Center on Second Street, which leads people to hang out on the street after dropping off cans.

The bottle drop, and broader conversations about homelessness in the central district, have come up frequently at business association meetings over the last few years. Discussions about the future of the bottle drop facility go back as far as 2021.

Board meeting minutes recorded in a 2022 meeting established relocating the bottle drop as a top priority, citing the facility as “the elephant in the room” and stating “any council member that wants to be our liaison needs to be against bottle drop.” The businesses have met with bottle drop officials, who have been “receptive” to a possible relocation, according to Breslau. The businesses have met about the issue with city officials, who relayed the concerns to bottle drop officials, and offered assistance with relocation, according to Bend City Manager Eric King.

But orchestrating relocation of the facility — which is run by the nonprofit Oregon Recycling Beverage Cooperative — is not within the purview of the city, King said.

“They’re in the driver’s seat in terms of timelines and locations for consideration,” he said.

Devon Morales, vice president of external affairs with the Oregon Beverage and Recycling Cooperative, said the organization has met with the city and business leaders several times over the past few years to discuss and learn more about plans for redevelopment.

41 million cans and bottles were redeemed at the Bend facility in 2024. It serves 26,000 account holders, Morales said.

Siting redemption centers is partially dictated by state law. The facilities must be within a certain proximity of grocery stores participating in the BottleDrop.

“Moving the Redemption Center requires a complex evaluation process and has the potential — in the case of Bend — to have a significant negative impact to thousands of residents and hundreds of local nonprofit organizations,” Morales said in an email.

Breslau said the business association hopes at some point it will be in the best interest of all parties for the BottleDrop to move.

A resource for unhoused people

Some homeless and low-income residents rely on the 10-cent deposit to get by.

In 2023, Marlon Jones began redeeming cans through a community organization tying together a group of homeless and low-income residents who collect cans and use donations to make money. Jones said he makes $10 to $15 a day when he participates.

“It’s not a lot of money, but it’s a jumping start,” he said.

Until recently, Jones was living at the nearby homeless shelter at the old Rainbow Motel in the heart of the central district. The city purchased the property in 2022 for $4.5 million. It opened the following year as the Franklin Avenue Shelter with funding from the city and Deschutes County.

Jones moved into more stable housing in the fall at the Old Mill Inn and Suites, a renovated motel on Third Street that provided 76 units designed to be a permanent housing placement as people transition out of homelessness. Jones said he spends about an hour or two in the vicinity of the BottleDrop on days when he returns cans.

Homeless resident Raquel Welch said she has found a community in the Second Street area. She collects cans for income and usually sleeps nearby at the Lighthouse Navigation Center, a resource center and 100-bed overnight shelter, but sometimes arrives too late and has to sleep in a tent. During those times, she’s grateful to have people she knows in the vicinity.

“It feels safer because we have our street family and all our friends,” Welch, 40, said.

Some homeless residents in the area said that if the BottleDrop relocated they would have trouble accessing it because of lack of transportation. Others said they would find a way there.

“Homeless people will make it to the BottleDrop no matter where it is. They’re resilient.” said Zoe Pensinger, who was seated on the corner of Franklin and Second Street. She slept on the streets in the area for a year before getting into the 56-unit Stepping Stone shelter, which opened in 2023 with city funding through project Turnkey.

Dave Vodrazka, 47, was living on Hunnell Road during a major sweep of homeless encampments there in 2023. He said he’s had a car and an RV taken away from him. Now he sleeps in a tent in the central district area. He said he prefers not to go to shelters.

“They’re forcing us out of here by harassing us and taking our stuff, to the point where you don’t even want to be around,” he said.

Since passing a code regulating camping in 2022, the city of Bend has removed large encampments determined to be a risk to health and human safety. Camping in one place in cars or tents on public streets for more than 24-hours is a violation of the code. People found in violation have another three days to move after that.

The city hasn’t issued any citations under the camping code. During the final three months of 2024, the city’s transportation and mobility department issued 21 notices to move people camping in the Bend Central District.

Meanwhile, police increased patrols in the area in September. From August 2023 to August 2024, the Bend Police Department responded to nearly 5,000 calls in the central district area, resulting in 600 arrests — 17% of all arrests in Bend during that time frame. Sheila Miller, a spokesperson for the police department, said the most common offenses were trespassing, disorderly conduct, theft, assault, criminal mischief, DUII and offensive littering.

“The area was a concern not just for the police department but for business owners, residents and concerned community members – it was a livability issue,” Miller said in an email.

The increased police presence is designed to increase safety and “root out open-air drug abuse” while offering deflection to people who might be in addiction, she said.

A shelter off the table

The city has contributed to the opening and operation of 216 low-barrier shelter beds since 2021, a portion of the 500-plus total shelter beds in the city. The only walk-up emergency shelter beds are located in the Lighthouse Navigation Center, which was temporarily operating on Franklin Avenue during the city-funded renovation of its facility further south on Second Street, where the shelter has now reopened.

According to King, the city manager, the Lighthouse is expected to be operational for “quite some time.” But 27% of the city’s low-barrier beds will fall out of operation once the city develops the old Rainbow Motel and adjacent properties into a new city hall, urban plaza and affordable housing.

Matt Stuart, the city’s real estate director, said the shelter is funded through 2025, and the city is six to nine months away from engaging private and nonprofit developers on the project.

Central district business leaders were skeptical of the city’s decision to use the property as a shelter in the first place, questioning in a 2022 letter whether the city had changed its vision for the area by bringing in new homeless services.

But the shelter was always meant to address the temporary need for emergency beds as the homelessness crisis grew after the pandemic, King said. The city’s vision is to drive development in the central district, “but at the same time respect those that are there, and address some community needs including housing for folks that are trying to exit out of homelessness,” King said.

Even with more transitional housing being built in Central Oregon, there’s still a “critical need” for the Franklin Avenue Shelter, said Nicole Merritt, director of operations with Shepherd’s House, the nonprofit that runs that shelter and the navigation center. According to Merritt, Shepherd’s House doesn’t have plans to add shelter beds elsewhere to fill the need, though the nonprofit is open to working with community partners.

The Franklin Shelter is unique because it provides private and semi-private rooms, Merritt said. Its central location is one of its “greatest assets,” providing easy access to transportation, medical and other needs, she said.

“A central location also helps reduce isolation and ensures that people experiencing homelessness can more easily connect with the support they need to stabilize and eventually find permanent housing,” Merritt said in a statement.

Bend Mayor Melanie Kebler, who served as the city council liaison to the Bend Central District before becoming mayor, said she believes the city can still provide adequate shelter services to address homelessness even with the Franklin shelter closed.

“We will continue to work with our nonprofit partners to provide the services needed in Bend, including shelter at another location if needed,” Kebler said.