City Facing Historic Deficit; Where Would You Cut?

[March 20, 2025]

It’s too early to tell how the City’s budget process will shake out, but it isn’t looking good. The City’s general fund is close to $100 million short, or approximately 12%; an additional $50 million from other funding sources for items such as sewers and transportation will dry up as well. 

Would you close community centers? Lay off staff in the permitting department, which could slow construction of additional housing? Pause street maintenance? Reduce funding to the police and fire departments? All of this and more is on the table as the Mayor and City Council grapple with this unprecedented shortfall. 

A figure from the City Administrator's February 28 draft recommendations.

As a first step in the budget process, City Administrator Michael Jordan released his budget recommendations on February 28. the recommendations included $23 million in cuts to the parks department by reducing hours at community centers and sports facilities, eliminating summer programs and day camps. Jordan also recommended cutting $22 million from the Portland Bureau of Transportation by scaling back pothole repair, safety and accessibility improvements and basic upkeep of roads and sidewalks.

Mayor Keith Wilson presents his budget to City Council on May 5. The city council can amend the budget and then will vote on a final version on May 21. 

12 city councilors means potentially 12 different takes on the budget deficit, but one doesn’t have to look any further than our own District 4 to see divergent perspectives in action. 

Take public safety, for example. Unlike in past years, the police and fire departments have been asked to prepare reduced budgets for consideration by City Council.

Councilor Eric Zimmerman has indicated that rather than cut, he wants to increase police bureau resources. His District 4 colleague Olivia Clark said that while she thinks we need more police officers, her goal in this budget cycle is to maintain the status quo and keep public safety funding at the same level. The third District 4 rep, Mitch Green, pointed out that protecting public safety budgets would mean 50% cuts to everything else. He sees some places for reasonable savings in public safety, but is waiting to hear what voters want.

New Form of Government, New Dynamics

The budget will be the first major test of the new city council. Votes have been largely unanimous so far, but Green expects that will change as the council works out different perspectives on the budget and where to cut. Clark agrees that the budget vote will expose fault lines on the council, pointing to the vote for Council President back in January as an example of what we might see: After nine rounds of 6-6 votes, Councilor Green changed his vote, resulting in a narrow victory for current president Elana Pirtle-Guiney.

Early analyses of the new form of government as it was proposed to voters described it as a “weak mayor” system. The mayor’s powers include hiring and firing the city administrator and preparing the budget. That budget must be approved by City Council, of which the mayor is not a voting member. The mayor has tie-breaking powers, however, which will come into play if the council repeats the even split of the January vote.

Portland Clean Energy Fund Could Be a Resource

Revenue generated for the Portland Clean Energy Community Benefits Fund (PCEF) by taxes collected on high earners has wildly exceeded expectations since it started in 2020. The fund has been earning interest, while little of the principal has yet to be spent. Last year’s city council tapped into the fund to plug various budget gaps, including for street tree maintenance. Suggestions have already been floated this year for other uses for PCEF funds, including construction of sidewalks.

Zimmerman wants that money put to work, not just sitting in an account. “We can get it to work for climate, but get it to work next year,” rather than on the five-year schedule attached to many of the previously proposed uses.

How Did We Get Here?

General fund revenue has declined and costs have gone up. Both Clark and Green note that property taxes make up most of the revenue for the City’s general fund, and most of those revenues have historically come from downtown Portland. COVID changed that, and the City has yet to recover. Property taxes are capped by state law and haven’t kept up with inflation. And finally, one-time pandemic emergency funding has dried up. 

Past City Council decisions contributed to the problem by creating unsustainable growth. New programs and facilities have come online, adding to the burden on the budget with new staffing and maintenance needs. According to District 3 Councilor Steve Novick, when the 2020 parks levy was passed, services expanded and the already-considerable maintenance background went unaddressed. In addition, general fund dollars for parks were reduced, shifting those costs to the levy, which expires in 2026. 

As District 4's Clark put it, “Sometimes our eyes are bigger than our wallet and we aspire to do a lot more than we can afford, and that’s coming home to roost. Given the situation we’re in with the budget and the pressure we’re under, it’s really important that we get back to the basic things that our local government should be doing for us.”

What Are the Basics?

“Water, sewer, streets.” Those are Clark’s basics. 

Zimmerman agrees, also noting that although city government has been transformed at the elected level, much work remains. He hopes to see the mayor’s budget include streamlining to eliminate redundancies and inefficiencies across the City’s six service areas and 26 bureaus. “In my opinion, they have about 26 versions of how they do HR, 26 versions of how they do communications, 26 versions of how they do community engagement. 
That's not the basics for me.” He sees the current budget discussion as a key step in completing the transition that began with the charter reform vote in 2022.

Future Considerations

The $100 million shortfall is an immediate crisis, but balancing next year’s budget does not solve Portland’s problems.

Councilor Zimmerman wants to have a conversation he says is long overdue about the City's role, asking "What are our core services, what are the lines of business that we are not going to be in anymore?"

Portland’s redevelopment agency, Prosper Portland, could see its general fund contributions reduced next year. Beyond that, Councilor Green wants to look at the City’s relationship with Prosper Portland, and the special tax districts that provide most of its funding. “It’s not free money,” he said, “it comes from our future revenue,” which, he pointed out, amounts to billions of dollars that’s not going to the general fund for parks, schools, and potholes. “That may be fine, voters may like that,” he said, but he thinks it's important to have the conversation.

Portland’s parks department faces some very hard conversations in the coming months. Parks officials painted a bleak picture recently for the council’s Climate, Resilience, and Land Use Committee. Requested by the City Council to outline what $58 million in cuts would look like, staffers sketched out a grim scenario of closed community centers and shuttered parks facilities. 

Whatever cuts the parks department experiences next year, more blows are coming. The bureau has a $600 million maintenance backlog, while parks and facilities have been developed or expanded in the past few years, including a new aquatic center, which will have to be staffed and maintained. The parks’ department Sarah Huggins told the committee that, “at current capital maintenance levels of funding, one in five assets could close over the next 15 years.” The property tax levy approved by voters in 2020 expires in 2026 and discussions are underway over whether to bring a renewal to voters and at what rate. Parks officials have asked for the levy rate to be doubled, from $.80 per $1,000 assessed value to $1.60, but early responses have not been positive. 

Other approaches to funding parks and recreation have emerged for discussion, including pursuing new community partnerships, in some cases turning over the management of parks assets to other groups, floating a new bond, or creating a separate parks district. 

The fire department has stretched equipment lifespan, including engines and trucks, through careful maintenance and by using older equipment for training. New equipment will be needed in the next few years. However, no obvious source of funding is in sight.

Councilor Clark points out that City-owned assets have not been maintained in many bureaus, and would like to see a robust city-wide approach to better asset management.

Mayor and City Councilors Need to Hear from Voters

Community engagement started on February 28, Councilor Green said, with the release of the city administrator’s budget memo. Between now and May 5th when the Mayor presents his budget, Green said, “We’re going to be listening.”

According to Zimmerman, testifying in person is the most effective, followed by emails. Testimony at the listening sessions can have impact on the Mayor’s budget, due on May 5th. After that, City Council will hold budget work sessions that will be mostly devoted to public testimony. 

Can residents lobby councilors outside of their home districts? Absolutely, according to Green. “Pay attention to which councilors are taking the approach that you want to support and don’t just interact with your own district reps,” he advised.

So what do you want? Here are some of the options to weigh in on what to cut and what to preserve.

Budget Listening Sessions

Four listening sessions have been scheduled, one in each district. Two have already been held and two are coming up in April. Each session is open to all, regardless of which district you live in. The two remaining sessions as of this writing are:

District 4: Tuesday, April 1, 6–8:30 p.m., Portland Building, 1120 SW Fifth Avenue. More info here. 

District 2: Thursday, April 3, 6–8:30 p.m., Portland Community College Cascade Moriarty Auditorium, 5514-5518 N Albina Ave. More info here.

Submit Written Testimony

Submit your feedback online through the City’s Budget Comment and Testimony Form. 

City Council Work Sessions

Consult the Budget Calendar

District 4 Constituent Events

District 4 reps have scheduled “office hours” in the community. Below are some upcoming events. Check each District 4 rep’s webpage under the “events” tab for more dates as they are added.

Councilor Clark: 

Tuesday, March 25, 3-5:00pm

Steeplejack Pizza and Beer, 4439 SW Beaverton-Hillsdale Highway

Saturday, April 12, 2:30-4:30pm

Fulton Park Community Center, 68 SW Miles Street

Councilor Green:

Friday, April 11, 10am-2:00pm

Sellwood Community House, 1436 SE Spokane St, Portland, OR 97202

Public Meetings

City councilors meet as a council monthly, as well as in committees that also meet monthly. All meetings have time set aside for public comment. See the meeting schedules and find testimony sign up information here. 

Contact Information

Find contact forms, email addresses, and D4 councilors’ events in the community:

District 4 Councilor Olivia Clark: website

District 4 Councilor Mitch Green: website

District 4 Councilor Eric Zimmerman: website

Mayor Keith Wilson: website 

—Valeurie Friedman

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What are "basic" services? What are some things that maybe the City can't afford anymore? Let us know.