Thursday, May 7, 2020, Mayor Ted Wheeler released his Proposed Budget for FY 2020-21.
Faced with a $75 million loss in General Fund revenue, Mayor Wheeler and his team were able to reduce that gap by 90% by identifying City reserves, set-asides, and pulling back on underspending.
That means, the City of Portland is able to meet this current financial challenge because of a foundation of fiscal responsibility and good stewardship of taxpayer dollars in the last few years.
The Mayor’s Proposed Budget protects core community values and services, intentionally tackling the inequities that existed before COVID-19, and creating a platform for community recovery.
“Crisis reveals the true character of a city and what we have discovered during this emergency-mitigated budget process, is a City budget that will be able to largely withstand the economic blow of this crisis,” Mayor Wheeler said. “My team and I turned over every stone looking for opportunities to close the financial gap without impacting core services to the community and sacrificing our equity and climate values.”
The Proposed Budget takes measured but significant action, also deploying Citywide cost containment strategies and programmatic reductions that minimize the impact on any one program area or service.
The budget forecast reflects an expectation of $75 million less in General Fund revenue in FY 2020-21 than it did two months ago – before the COVID-19 crisis hit.
The $75 million reduction to the forecast—which equates to about a 13 percent decrease—includes a projected decrease of $45 million in business license taxes, and a $20 million dollar decrease in transient lodging taxes which have declined about 50 percent. Actions taken to close the gap include:
- Identifying $59 million in savings without asking bureaus for cuts in two ways: by eliminating $28.5 million in the City’s February forecast (excess revenues the City was forecasted to receive - but had not yet budgeted - before COVID-19 happened) and by taking another $30.8 million from City reserves, set-asides and current year program underspending.
- Instituting wage freezes and furlough requirements for non-represented City employees, and asking our represented employees to share in this Citywide action to preserve as many jobs as possible.
- Reducing the normal inflationary increase bureaus typically receive for General Fund materials and services costs, and directing all bureaus to limit materials and services spending.
- Calling for thoughtful bureau reduction proposals to cover the remaining $9.3 million funding gap, to be considered as part of the Fall Supplemental Budget process.
“We are in highly unusual and uncertain times financially. The financial picture is still very much evolving,” City Budget Director Jessica Kinard said. “In the face of such uncertainty, this budget provides thoughtful and strategic solutions that will set us up to be in a better financial position once more complete information is known.”
In addition to protecting and supporting core City services such as public safety, livability, utilities and road maintenance, the budget also makes targeted investments in priority work by:
- Investing in organizations and programs to serve undocumented Portlanders.
- Supporting work invested in responding to and preventing hate crimes.
- Protecting VOZ, the Gateway Center for Domestic Violence, and the Office of Youth Violence Prevention from any cuts.
- Providing resources for important work to get more of Portland’s construction dollars to women- and minority-owned businesses, and to train a diverse workforce.
- Funding for Portland’s Age-Friendly Initiative.
- Allocating new Cannabis Fund resources to support local small businesses, prioritizing minority-owned enterprises.
- Adding a position to work on the City’s GreenFleet transition, ensuring continued progress on this top climate action.
- Funding our contribution to the regional partnership to build a cleaner and greener construction industry.
- Funding new parks and new park amenities that are coming on-line this year across the community and especially in East Portland.
- Funding Portland Parks & Recreation’s work to move toward a financially sustainable future.
“Our world will be permanently changed by this crisis, but I firmly believe in the strength and resilience of our community,” Mayor Wheeler said. “In our response, we have both a responsibility and an opportunity to reimagine our practices and our systems, setting a new foundation that puts fiscal resiliency, equity, the needs of our vulnerable populations and climate action at the front and center of every budget decision we make.”
Along with providing a platform for fiscal stability, the Mayor’s proposed budget elevates equity and inclusion, supports frontline communities hit hardest by the COVID-19 crisis and protects vulnerable communities by:
- Prioritizing homeless services: provides $6.2 million to continue current funding levels for the Joint Office and holds them harmless from further cuts in the Fall.
- Providing critical rent assistance: provides $8.4 million of reallocated existing and newly allocated federal grant resources to provide 3-6 months of rent support to 2,100 families.
- Including $455,000 to provide assistance to vulnerable individuals and families who may not be eligible for CARES stimulus and unemployment benefits.
- Directing the Bureau of Planning and Sustainability to prioritize and continue critical work to mitigate displacement within their existing resources.
- Including $75,000 in interagency resources to support and enhance tribal liaison work in the Office of Government Relations
- Reallocating resources within the Bureau of Transportation to fund additional streetlights along 12 miles of poorly lit areas of the High Crash Network.
- Providing $1.6 million to continue critical work making our street corners ADA accessible across the City.
- Directing bureaus to consider how to narrow service level gaps and improve the living conditions for underserved communities first and foremost when putting forward their budgets in the Fall.
The community is invited to take part in a public hearing on Tuesday, May 12, 2020, when City Council will serve as the budget committee to hear to hear public testimony on the Mayor’s Proposed Budget. The deadline to apply to testify is Friday, May 8, at 4 p.m. More information on the hearing and public comment sign-up process can be found here. Other future action being taken to finalize the budget includes:
- City Council action to approve City of Portland Budget – Wednesday, May 20, 2020 (time TBD)
- City Council action to adopt City of Portland Budget – Wednesday , June 10, 2020 (time TBD)
More information and updates on timelines for the budget process can be found here.
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