Interim Portland City Manager Danielle West proposed a municipal general fund budget of nearly $269 million for fiscal year 2023 to the City Council Monday night.
The proposed budget is up almost 27 percent from the current fiscal year, driven largely by increases for the Department of Health and Human Services.
In a memo to councilors, West said assisting homeless residents and asylum seekers would make up a significant portion of the budget – more than $45 million, which is more than double the city’s current HHS budget.
“The increase in the City’s HHS budget for FY23 represents nearly 80 (percent) of the City’s total FY22 to FY23 budget increase,” West said.
During the past two years, the city reduced its operating budget because of revenue losses caused by the coronavirus pandemic, which helped to reduce the fiscal 2022 burden on taxpayers by 4 percent. It also is receiving more than $46 million in American Rescue Plan Act funding to offset revenue lost because of the pandemic. According to West’s memo, the city had revenue losses of nearly $28 million from the end of fiscal year 2020 through 2021.
The proposed general fund budget doesn’t include items like sewer and stormwater operations and the Portland Jetport, which generate their revenue. It would require a 5.5 percent increase in the tax rate, or an additional $6.56 per $1,000 of assessed value.
If not for ARPA funding, West said, that increase would have been 17 percent.
Assuming the council adopts and voters validate the $133.1 million School Department budget approved by the School Board, the total city budget would be just over $402 million. The school portion of the tax rate would increase by $7.05 per $1,000 of assessed value, to create a total increase in the mil rate of $13.61.
The municipal portion of the budget would mean a tax increase of $119 annually for the owner of a home valued at $350,000. According to Tess Nacelewicz, the School Department’s communications director, the school budget would add 28 cents to the school portion of the tax rate, or $98 additional for a home valued at $350,000.
If both budgets are approved without any changes, the owner of a property valued at $350,000 would have to pay an additional $217 in taxes.
According to West, the city cut 65 full-time employee positions two years ago, restored 20.5 of them last year, and had hoped to continue rebuilding in 2023. But the proposed budget doesn’t include several full-time jobs that will remain unfilled.
“Despite these realities, we have worked to address some of the Council’s stated priorities including setting aside $150,000 in funds for the creation of a Diversity, Equity and Inclusion Office, additions to staff in the Sustainability Office, among other things,” West said.
The budget now goes to the council Finance Committee. The school budget will have its first reading by the council on May 2 and a vote on May 16. The council is slated to vote on the municipal budget on June 6, and the school budget validation referendum will be held on June 14.
Decision expected on East End food trucks
In a brief meeting that included just five of the nine city councilors and where a Zoom link did not initially work, interim City Manager Danielle West on Monday told councilors she would have a decision next week on potential changes to food truck operations on the city’s Eastern Promenade.
The City Council on Monday also issued a request for proposals to purchase a derelict former hospital on Great Diamond Island.
In a memo to the council, West offered no indication about which way she is leaning on the food trucks question. But she said her decision on May 2 would only be temporary.
“Anything we choose to do is a pilot program,” West said.
West’s choices include allowing food trucks to remain on the Eastern Promenade, moving them to a Cutter Street parking lot below the promenade, or a combination of both. All options would effectively limit the number of trucks allowed at one of the city’s most popular public parks.
“We fully understand and appreciate that how public space and parks are used is a topic many residents feel passionately about,” West wrote in the memo.
In prior committee meetings, several Munjoy Hill property owners spoke against maintaining the status quo, saying the trucks obscure their views of the bay and create noise, odor, and trash in one of the city’s most affluent and least-affordable neighborhoods. Several said the food trucks should be moved to other parts of the city, such as the Bayside neighborhood.
Great Diamond property
The request for proposals for the tax-acquired property on Great Diamond Island involves the former Fort McKinley Hospital, which was originally put up for sale in 2003. Developer David Bateman initially agreed to purchase the property and the former Double Barracks on the island.
But while the Double Barracks was eventually turned into the lucrative Inn at Diamond Cove, the former hospital property remained empty and Bateman’s purchase agreement expired in 2019.
According to West’s memo, the city’s goal is to sell the parcel for fair value and recover back taxes and interest totaling $150,000 and growing daily. The city also hopes to recover the cost of approximately $30,000 in property maintenance. As such, the RFP lists the current value as $180,000.
— Colin Ellis