With the coronavirus pandemic putting an unprecedented strain on the city of Portland’s finances, Mayor Ted Wheeler released a budget proposal Thursday that he pledged would be able to withstand the economic blow.
The economies of major cities across America have been ravaged by COVID-19, and Portland is no exception. The city relies on tourism, business, and property taxes to function — all of which are expected to take a hit in the coming fiscal year. The latest city analysis forecasts Portland’s general fund will receive $517 million in the next fiscal year — $75 million less than anticipated.
But Wheeler said he’s found a way to patch the shortfall without the layoffs and drastic bureau cuts other cities are experiencing.
“If there’s one thing ... you remember from today, let it be this: Our world was turned upside down by COVID-19. And as a result we were facing what looked like a free fall of drastic cuts across the board. A sudden $75 million loss in general fund revenue at least,” Wheeler said at a press conference to announce the proposed budget. “But what happened? Thanks to the last few years of strong financial management, we closed almost 90% of that gap through this budget.”
The mayor has proposed to close the gap by drawing from the city's reserves, curtailing new spending, and implementing furloughs and wage freezes. The city's already frozen raises and instituted a mandatory 10-day furlough for all non-union city employees. They're now pushing for unionized employees to join.
“This budget relies on cuts to personnel compensation,” said Wheeler. “In order to avoid layoffs, I've asked our labor leaders to share in the sacrifice that others have already taken.”
Wheeler added that, after several weeks of conversations, there are no commitments in place yet with labor union leaders, but that the talks are going well. If no agreement is reached, Wheeler said the city will need to find a way to save $9 million.
Other budget highlights:
- Homeless services: Under the proposed budget, the city would continue funding the Joint Office of Homeless Services, the city-county office responsible for providing services for unhoused people, at its current level of $6.2 million.
- Parks: Portland's parks bureau is one of the hardest hit by COVID-19 with no fees coming in from their usual activities and facilities. The mayor said he's "committed to finding and funding a sustainable future" for Portland's parks. Under the proposed budget, the city would fund the operation and maintenance costs at 21 parks sites slated to open this year.
- Rent assistance: According to the mayor's proposal, the Portland Housing Bureau has received a little over $5 million from the federal coronavirus relief package. Roughly $4 million of it would be used to provide three months of rent support for 1,300 households.
- Low-income Portlanders: The proposed budget promises $455,000 to fund groups that don't have access to the government's stimulus check and may not be eligible for unemployment benefits. The bulk of that money would be split between Equity Corps of Oregon, the state's effort to provide legal defense for immigrants and refugees in immigration court, and the state's new Oregon Workers Relief Fund, meant to assist workers who don't qualify for unemployment insurance. The Street Roots Vendor Assistance Fund would receive $5,000, which is providing money and assistance to people experiencing homelessness.
- Auditor's office: One point of the proposal that's already become a source of contention? The placement of the city's hearing office. The office is responsible for conducting independent hearings for Portlanders who have a dispute with the city on issues ranging from land use to city code. Last August, Auditor Mary Hull Caballero said she didn't want to house the office any longer, as she felt it wasn't funded appropriately by the city and the caseload was mounting. In a stern letter, she gave city leaders until the end of the fiscal year to find a new home for the office. In his proposal, Wheeler said the office would need to remain with the auditor, citing an uncertain budget and conflicts of interests posed by housing it with any other bureau. In a statement released hours after Wheeler announced his budget, Hull Caballero said assigning the auditor duties without consent is a violation of city charter. "Council has no such consent, and the Mayor unlawfully put the Hearings Office back into the Auditor's Office budget," she wrote. "I am calling on all Council members to remove the Hearings Office from my budget before they vote to approve the overall City budget."