The City of Portland ordains.
Section 1. The Council finds:
- The Bureau of Planning and Sustainability (BPS) shapes Portland’s future and advances climate protection for a more prosperous, healthy, equitable, and resilient city now and for future generations.
- In 2018, Portland voters created the Portland Clean Energy Community Benefits Fund (PCEF) program, which invests in community-originated climate action projects that advance racial and social justice.
- In 2020, City Council declared that a human-made climate emergency threatens our city, our region, our state, our nation, humanity, and the natural world, and that such an emergency calls for an immediate mobilization effort initiating greater action, resources, and collaboration that prioritizes frontline communities to restore a safe climate (Resolution No. 37494, as amended “Climate Emergency Declaration”).
- In 2022, City Council adopted the Climate Emergency Workplan to implement its Climate Emergency Declaration (Resolution No. 37585).
- Later in 2022, Council amended the PCEF code to strengthen and streamline the PCEF program based on insight from early program implementation and audit recommendations. The amendment broadened eligible funding recipients and funding areas and required the development of a five-year Climate Investment Plan (CIP) to direct PCEF’s investments (Ordinance No. 191046, the CIP is defined in PCC 7.07.030(D)).
- In 2023, the PCEF Committee unanimously recommended City Council adopt the CIP, and Council unanimously adopted the CIP, authorizing BPS to implement the CIP’s investment of $750 million between 2023 and 2028 (Ordinance No. 191463).
- Following Council’s adoption of the CIP, Commissioner Rubio directed PCEF staff to work with City Bureaus to identify additional climate investments that could be implemented if funds beyond those allocated in the CIP became available. PCEF staff requested that City Bureau leaders provide information on projects that aligned with PCEF criteria and the Climate Emergency Workplan. Submissions were prioritized based on: (1) meaningful and measurable greenhouse gas reduction or sequestration impacts; (2) demonstrable community benefits; (3) ability to offset City General Fund expenses; (4) “Shovel ready”: projects are listed in existing capital plans; (5) “Implementation ready”: programs have existing capacity for delivery.
- In December 2023, the City Budget Office (CBO) released a memo forecasting an additional $540 million in revenue for PCEF over the next five years. In response, Mayor Wheeler issued a budget guidance memo outlining expectations for PCEF to coordinate with CBO and City Bureaus “to propose a considerable amount of funding for existing projects, programs and services that meet the legal requirements and uphold the mission of the fund and ensure that we are making the fullest use of these resources.”
- In January and February 2024, the PCEF Committee heard public testimony and deliberated on the funding proposals submitted by Commissioner Rubio. These proposals were informed by evaluations of City Bureau projects conducted by PCEF staff. The PCEF Committee ultimately recommended a modified proposal comprising 24 strategic programs, or strategic initiatives as defined in code, for City Bureaus totaling $382,815,000.
- In Spring of 2024, the City Council adopted the City’s FY 2024-25 budget, which included one-time and ongoing PCEF funding based on the Committee’s February 2024 recommendation. The budget increased the PCEF Committee’s recommendation, resulting in a five-year allocation of $386,987,000 to City Bureaus.
- This CIP amendment formalizes the strategic programs for City Bureaus and provides a framework for tracking their climate and community benefits. For effective program administration, some of the initial 24 programs were consolidated, resulting in a total of 19 distinct and new strategic programs described in Exhibit A.
- This CIP amendment additionally: (1) corrects tabulation errors in the original CIP related to Strategic Program 16, Climate-Friendly Public Schools, without changing the program’s overall funding; (2) increases funding for the Community Responsive Grants (Community Grants) program by $120 million to address significant demand for funding for community-led projects; (3) allocated $300 million for the Collaborating for Climate Action funding opportunity; (4) adjusts the CIP end date to June 30, 2029, aligning it with the City’s fiscal year instead of the original end date of October 31, 2028; (5) amends the Tree Canopy Maintenance Reserve to focus on private property trees given the development of new, larger programs targeting street trees; (6) updates the naming of the Tree Canopy Maintenance Reserve program to align with the naming conventions for strategic programs; (7) addresses inflationary impacts for a subset of 2024 City Climate Projects that would have historically received Current Appropriation Level Target adjustments, increasing funding for these projects by $12.3 million; (8) creates an additional $12 million inflation contingency fund for City Climate Projects to be administered by the City Budget Office and BPS; and (9) adds Cooling Portland, a pre-CIP program, as a strategic program and increases its funding by $10.3 million due to the program exceeding program goals significantly ahead of schedule.
NOW, THEREFORE, the Council directs:
- BPS to amend the CIP to include the new strategic programs and other adjustments, as shown in Exhibit A. The amended CIP is in effect through June 30, 2029, for a total funding allocation of $1,591,590,328.
- BPS staff to post this ordinance on the PCEF website.
- The BPS Director to negotiate, execute, and amend interagency or similar agreements with City Bureaus to implement the amended CIP.
- Notwithstanding Portland City Code 7.07.060(C), limited-purpose grant agreements equal to $5,000 or less do not have to include terms related to renewable energy products, workforce and contractor equity agreements, or family wage standards.
- If funding adjustments are recommended by the PCEF Committee, the BPS Director is authorized to amend funding allocations within the CIP, including related scopes of work, provided those amendments reflect the PCEF Committee’s recommendations and distribute no more than 10% of a given program’s allocation while maintaining the overall allocations of funds across funding categories. This authorization allows for minor adjustments based on program needs while preserving the funding allocations and CIP intent across funding categories. If PCEF funding projections increase, funding adjustments may include an increase in the total allocation of funds in the CIP, up to 10%.
Exhibits and Attachments
Impact Statement
Purpose of Proposed Legislation and Background Information
Portland voters passed the Portland Clean Energy Community Benefits Fund (PCEF) in November 2018. Subsequently in 2019, City Council seated the PCEF Committee, a cohort of nine volunteers that reflect the racial, ethnic, and economic diversity of our city and makes recommendations to the Mayor and City Council.
The purpose of PCEF is to provide a consistent, long-term funding source and oversight structure to invest in climate action projects, in alignment with the City’s climate action goals, that support environmental justice and environmental, social, and economic benefits for all Portlanders, including the development of a diverse and well-trained workforce and contractor pool to perform work that reduces or sequesters greenhouse gases (GHGs).
In October 2022, City Council amended the PCEF code to strengthen and streamline the PCEF program based on insight from early program implementation and audit recommendations. The amendment broadened eligible funding recipients and funding areas and required the development of a five-year CIP to direct PCEF’s investments. The 2023 CIP, approved by City Council in September 2023, is grounded in climate research, deep community engagement, and multiple rounds of input from residents, businesses, subject matter experts, government partners, and community organizations to ensure the proposed solutions address the needs of Portland residents most impacted by a rapidly changing climate. All programs are evaluated with PCEF’s equity + climate framework, which considers benefits to frontline communities, community leadership, implementation feasibility, GHG emissions reductions, and accountability. The CIP serves to outline performance measures and goals, educate community members, and provide certainty to businesses, nonprofit organizations, government, and residents who are critical to PCEF’s success.
To date, PCEF has allocated over $883 million through Community Grants and Strategic Programs. The Cooling Portland program has provided over 13,000 lifesaving cooling units to low-income Portlanders in response to increasingly extreme heat events. 178 nonprofit organizations have been awarded funding for projects in energy efficiency, renewable energy, workforce and contractor development, transportation decarbonization, regenerative agriculture, and green infrastructure.
Now, with the additional resources allocated in this amendment, PCEF will make additional investments in climate action led by City Bureaus, and community grants by led by non-profit organizations. The planned allocations from the 2024 Collaborating for Climate Action Funding opportunity, will deepen PCEF climate investments through large-scale coalition-led projects.
The programs in the amended CIP leverage existing and projected additional funding sources focused on climate action, including from Energy Trust of Oregon, Oregon Department of Energy, utilities, and federal incentives. Coordination with these programs will bring maximum benefit to Portlanders, lower emissions, and make our communities more energy efficient and climate resilient. The design and framework of the amended CIP is in strong alignment with City goals outlined in the Climate Emergency Workplan, the 100% Renewable Energy resolution, Prosper Portland’s Advance Portland, as well as State of Oregon goals for 100% Clean Energy.
The ordinance directs BPS to implement programmatic agreements with the relevant City Bureaus to implement the programs outlined in the amended CIP. The BPS Director is authorized to amend the budget allocations within the Climate Investment Plan, including related scopes of work, as recommended by the PCEF Committee, provided those amendments distribute no more than 10% of a given programs’ allocation while maintaining the overall allocations of funds across funding categories.
Financial and Budgetary Impacts
The amended CIP is in effect through June 30, 2029, and directs a total funding allocation of $1,591,590,328. This amendment added the following allocations to the original $750 million allocated through the 2023 CIP: (1) $386,987,00 over a five-year period into 19 strategic programs led by City Bureaus (collectively, the 2024 City Climate Projects), (2) up to $24.3 million for inflationary impacts for 2024 City Climate Projects, (3) $130.3 million into existing successful programs such as PCEF’s Community Responsive Grants and Cooling Portland programs, and (4) $300 million to support projects from the Collaborating for Climate Action funding opportunity over the same five-year period. The 2024 City Climate Projects were included in the FY 2024-25 budget. The funding is secured from the collection of the Clean Energy Surcharge by the Portland Revenue Bureau, as authorized in PCC Chapter 7.07.035. The amount is inclusive of revenue already collected as well as forecasted revenues generated during the FY 2023-2029 period.
The Bureau of Planning and Sustainability will develop programmatic agreements with the City bureaus to transfer funding for the 2024 City Climate Projects. The following bureaus will engage in program delivery through programmatic agreements in the following amounts as a part of the 2024 City Climate Projects defined in the amended CIP.
- Portland Water Bureau:
- $2.5 million; SP 17: Home Water Leak Repair Program Expansion
- $1 million; SP 18: Facilities Energy Efficiency Improvements
- $2.825 million; SP 19: Renewable Electricity Generation
- $3.5 million; SP 20: Portland Hydroelectric Project Powerhouse Infrastructure Upgrades
- $6 million; SP 21: Portland Hydroelectric Project Relicensing
- Portland Bureau of Environmental Services
- $75.9 million; SP 22: Green Stormwater Infrastructure and Watershed Health
- Portland Bureau of Planning & Sustainability
- $2.85 million; SP 23: Climate Policy Team
- Portland Housing Bureau:
- $40 million; SP 25: Affordable Housing Energy Improvements and Preservation
- Portland Bureau of Fleet and Facilities
- $29.172 million; SP 26: Increasing City Electric Vehicle and Charging Infrastructure
- Portland Office of Arts and Culture
- $1 million, SP 27; Arlene Schnitzer Concert Hall Roof & Cooling Tower Replacements
- Portland Bureau of Transportation:
- $30 million; SP 28: Streetcar Replacement
- $10 million; SP 29: Active Transportation Maintenance & Operations
- $20 million; SP 30: Active Transportation Small Capital Projects
- $15 million; SP 31: Community Programming, Education, and Encouragement
- $39.3 million; SP 32: LED Streetlighting
- Portland Parks and Recreation:
- $7 million; SP 24: Unifying City Urban Forest Services
- $6.2 million; SP 33: Mt. Scott Community Center Resiliency Renovation
- $105 million; SP 34: Tree Protection, Care and Workforce Development
- $1.6 million; SP 35: Transition to Electric Landscaping Equipment
The implementation of the 2024 City Climate Projects will also require amending existing contracts and significant new contracting solicitations through competitive Requests for Proposals (RFPs). RFPs for contracted roles in CIP strategic programs will be coordinated in partnership with Procurement Services staff from City Operations.
BPS staff will administer the implementation of the amended CIP with both existing authorized and budgeted positions and additional positions that are authorized in the FY 24-25 budget. Funded City bureaus will implement the 2024 City Climate projects with both existing authorized and budgeted positions and additional positions that will be requested as programming ramps up. At least 170 FTE are directly or indirectly supported by the 2024 City Climate Projects.
Economic and Real Estate Development Impacts
Investment of PCEF funding in the 2024 City Climate Projects supports at least 170 FTE directly or indirectly of existing and new City positions in a wide range of classifications. The projects also support over hundreds of contracts with external businesses. All positions covered by PCEF funding must meet PCEF’s family wage standard of 180% of area minimum wage. While most City and contract positions relevant to these allocations already meet this standard, some Community Service Aide positions are impacted and this funding will result in higher wage rates for the Community Service Aides across the City.
Several programs work to alleviate the financial burden on low-income residents (renters and homeowners), helping prevent displacement and mitigate economic vulnerability. These include:
- Strategic Program 17 focuses on home water leak repair, which reduces the cost of fixing water leaks for low-income homeowners, and offsets costs associated with overbilling related to those leaks.
- Strategic Program 25 extends the useful lifespan of existing affordable housing through energy efficiency improvements and life, health, and safety upgrades. Approximately 10-18 properties will have renewed affordable housing regulatory agreements as a condition of funding. This program helps to alleviate the City’s housing shortage by maintaining and improving existing housing stock.
Community Impacts and Community Involvement
In the development of the 2024 City Climate Projects, prospective strategic programs were evaluated on several criteria, including having demonstrable community benefit. PCEF staff brought the proposed allocations to its advisory body, the PCEF Committee, over a series of several public meetings in January and February 2024 for their review and deliberation. The PCEF Committee received significant public testimony from community members and organizations. While some testimony supported City projects, especially those focused on active transportation and tree care, some expressed concern about allocating such significant resources to City Bureaus and advocated for greater funding for community-led projects through PCEF’s Community Grants program.
The PCEF Committee recommended a modified set of allocations to City Bureaus under the condition that the PCEF Committee has the opportunity to review and provide feedback on agreements with bureaus, including metrics, performance measures, and reporting requirements. PCEF will include a PCEF Committee liaison in reviewing annual progress reports and budgets for the 2024 City Climate Projects. Additionally, the PCEF Committee stipulated a public review of performance of the strategic programs after 2 years, with robust community involvement and site visits, where relevant.
Strategic programs focused on housing will make energy-related improvements in the homes and apartments of low-income Portland households, reducing their energy use and making their dwellings healthier, more comfortable, and affordable. Strategic Program 17, the Home Water Leak Repair Program Expansion, reduces the financial burden of homeownership by providing free leak repair services to low-income households. With PCEF funding, the program will serve approximately 170 households, doubling the current average of 84 households per year. Strategic Program 25, Affordable Housing Energy Improvements and Preservation, will decrease utility bills for tenants and building owners, prevent displacement of vulnerable renters by extending the useful life of buildings, and increase energy efficiency in at least 800 units of affordable housing. With added funds, the Cooling Portland program will provide an additional 10,000 units of life-saving cooling equipment to additional households, working to meet the ongoing community need above and beyond the original program goal.
Deeply expanded investments in green infrastructure and urban tree canopy will launch a street tree maintenance program that shifts the responsibility of street tree maintenance from property owners to the City. This will alleviate financial burden on homeowners, reduce barriers to tree planting, and support equity for areas of low existing canopy, urban heat islands, and greater PCEF priority populations.
Programming led by the Portland Bureau of Transportation (PBOT) will improve public infrastructure for biking, walking, and transit access, making it safer and more convenient for community members to travel without cars. PBOT’s equity matrix will be used to prioritize projects in areas that are home to large percentages of PCEF priority populations. Strategic Program 31 funds community programming, education and encouragement through programs including Sunday Parkways and Safe Routes to School that make active transportation more accessible to Portlanders. Without PCEF funding, much of this popular and in-demand community programming would likely have been eliminated due to budget constraints.
Workforce and contractor-related programs and allocations within the CIP are intended to grow and diversify the number of workers and businesses that produce goods or services that reduce or sequester GHGs with a focus on individuals who have been historically marginalized in the workforce. These investments will be critical given funding available from the Inflation Reduction Act, among other non-PCEF funding streams.
The Community Grants program continues to provide funding for creative and innovative climate solutions by nonprofit organizations, prioritizing proposals demonstrating climate expertise and experience serving frontline communities.
See the 2024 City Climate Project descriptions, as shown in Exhibit A, for additional details on community benefits in different strategic programs.
100% Renewable Goal
The programming outlined in the amended CIP will help City bureaus, other public entities, nonprofit organizations, and Portland residents and businesses implement projects that reduce energy use and generate renewable energy, in direct support of the City’s 100% renewable energy goal. In particular, SP 18, 20, 25, 27, and 33 provide resources for energy efficiency improvements in City facilities and affordable housing, some with expanded opportunities for renewable electricity generation through solar and microhydro projects. SP 21 funds a portion of the relicensing process for the Portland Hydroelectric Project, to enable the continued production of renewable electricity in the Bull Run Watershed.
These investments will result in lowering community-wide electricity use and producing local renewable energy helping reduce demand on the grid, providing greater systemwide resilience, and lowering peak loads for utilities that are making their own investments towards a 100% emissions-free system.
Additionally, SP 26, 29, 30, and 31 focus on transportation decarbonization to support the 100% renewable energy goal through electrification of 700 City-owned vehicles or pieces of equipment, mode shift away from fossil fuel powered vehicles, improvements in biking and pedestrian infrastructure, and greater access to public transportation options.
The 2024 City Climate Project goals and investments related to workforce and contractor development are also strongly aligned with the 100% renewable goals, for example trainings related to EV technology or safety for CityFleet vehicle technicians.
Financial and Budget Analysis
This action amends the Portland Clean Energy Fund (PCEF) Climate Investment Plan (CIP), for total funding of $1.3 billion through FY 2028-29. The amendment makes certain administrative and allocation adjustments to the previously adopted CIP. Of the total $1.3 billion allocation, the amendment adds roughly $140 million in new allocations, including $120 million in new community responsive grants, $10.3 million in additional resource for Cooling Portland, and $9.9 million in inflationary adjustments to existing allocations in among the CIP’s identified strategic programs.