The record · Transcript
Council Session — 2025-02-18
Transcript from the session's official auto-captions (24,369 words), shown in readable case and split into speaker turns. Speakers are not yet identified (colors just separate consecutive turns). Auto-captions can contain errors — check the recording for anything that matters.
Session summaryEditor-reviewed
On February 18, the Portland City Council held a work session, described by the body as its final review with a service area, focused on the Budget and Finance service area. Presentations covered divisions including Revenue, Treasury and Public Finance, Business Operations, Grants Management, the Controller's Office, and Risk Management, followed by the Fire and Police Disability and Retirement Fund (FPDR), Small Donor Elections, and the City Budget Office. Topics discussed included tax collection and correspondence practices, integration with tax preparation software, investment portfolio management and debt issuance policies, business operations support for bureaus, grants administration and an outgoing grants policy, accounting and financial reporting functions, and insurance/claims management. Discussion also covered FPDR's structure, funding levy, and long-term cost trends; Small Donor Elections program funding needs and participation metrics; and the City Budget Office's role in the budget process, including program offers, decision packages, and the Tax Supervising and Conservation Commission's review role. Council members raised questions on topics such as federal IRS data-sharing, debt strategy, insurance costs for community events, investment returns and ethical investment screening, FPDR pre-funding options, and how future budget materials and base budget reviews would be structured. Figures presented, including budget totals and investment yields, were stated inconsistently across speakers. Council indicated further discussions, including through the Finance Committee, would address budget process details going forward.
AI-drafted from the session's auto-captions, reviewed by an editor — describes the discussion only; recorded votes live in the vote ledger. Captions contain errors.
0 Yeah, yeah, I. Started. Alright.
1 Good afternoon. I'm going to call us into a work session. It is February 18th at 204. I apologize for the delay getting started. We had a little bit of room turnover we needed to do, but I think everyone is almost set at this point. While the last couple of counselors get logged in, we will invite up dca. It looks like you are here and ready to go. Counselors, we have a presentation. I believe it's our last work session today with a service area to get more information about how our finance service area works. It sounds like we'll be hearing the presentation in three parts with the opportunity for some questions on the non budget pieces at the start. And then we will do questions on the budget pieces toward the end. Is that right. Yes I will turn it over to you to get us started then. Thank you for being here.
2 Great. Thank you, madam president and counselors. Good afternoon. We're thrilled to be in front of you here today. For the record, I'm jonas berry, the city's deputy city administrator of budget and finance and chief financial officer. And in relation to today's presentation, I also serve as the director of many of the divisions that will review with you today. I want to begin just by thanking you again for giving us space to share information about the range of essential financial services that the budget and finance service area provides to support all city priorities. We look forward to and greatly appreciate your questions and feedback today and in the future. And thank you, madam president, for the introduction. I will clear up maybe what was a little confusion. This is not a budget work session in the context of budget development, but but indeed a work session to review the functions of the service area as a whole, of which one is the budget office. And we did save that for the end to leave lots of space for questions, quickly walk through the agenda. We have about 60 minutes total of presentation. I think we'll actually maybe be able to get in under that. I don't have 15 minutes myself with a couple of structured pauses for q&a. First, I'll give a brief introduction to the service area as a whole, including some some work that we do kind of comprehensively. And then we'll have each manager of each of the primary functional areas come up and take a couple of minutes to introduce themselves and the work performed by the teams that they manage. We've set this up with the first group of six divisions, and these are the areas for which I am the bureau director. And then we'll pause for q and a on that group. We have 20 minutes, of course, happy to take whatever time is necessary. And then we'll have a second group of, of presenters, which will include kind of the two quasi independent functions, which are the fire and police disability and retirement fund and the small donor elections, and then end with the city budget office, which, as you know, you all have a critical role and relationship. And then lots of time left, hopefully at the end for q and a, I think we've got scheduled till 430. So about the service area, very generally, the budget finance service area is structured with lean teams of business professionals that provide coordinated enterprise level financial services support and policy direction citywide. The leadership team of the service area, I'm sorry if you go back one one slide. Thank you. Leadership team of the service area includes each of the managers you'll hear from today, plus representatives from the equity and communications practices juan carlos and carrie belding, respectively, each of whom are also shared 5050 between the budget and finance service area and the city operations service area. Next slide please. So in alignment with city charter and policies, with state law and with public finance best practices, the primary objectives for the service area are to maintain basic financial operations without disruption. To identify and address risks and inefficiencies in the city's financial systems. To improve consistency and quality of service. And that's to both our internal customers. So the bureaus and employees and programs that we work with and externally. So to all portlanders, to folks who are vendors, who folks who receive grants, etc, and to promote collaborative financial leadership and decision making. And apparently we're excellent at choreography as well, which is a new, new skill set we're leaning into today. The city's financial professionals do things very well, quietly and often behind the scenes, all day, every day. We operate under the values identified in the gfoa code of ethics. Values centered on integrity, transparency, consistency, fairness, and inclusion. Sometimes folks ask me kind of what keeps me up at night and in the context of this service area, frankly, it's that we have too many single points of failure in very limited redundancy within many of our program areas. Many functions require specialty education, ongoing training, skill sets and expertise. And when we experience a staff outage, whether that's due to illness, family issues, retirements or other separations, we're often left scrambling to identify how to keep that work moving. Recruitment in this space can also sometimes be a significant challenge due to a relatively limited pool of candidates. This is true industry wide, but that also makes it even more challenging for us to attract those high highest caliber candidates. We're always looking for opportunities to develop and promote staff in-house, but we also have very limited resources for things like additional training for stretch assignments and professional development. So that is a challenge that we continue to face. We do have grand ambitions. We'll talk about a few of those today, and we in fact have community expectations that we improve processes and practices to optimize financial security, efficiency and transparency. Staff within the service area are superhuman, and their ability to put in extra effort and long hours to quietly keep the city running while responding to unexpected challenges. I would like to take a minute to recognize every individual within the service area and our financial service partners at the city. I see you, I recognize how difficult your jobs can be and thank you for all you do. We'll continue to move priorities forward as best we can, and we look forward to a possible future when our success is less constrained by those bandwidth issues. Next slide please. Thank you. As a service area, budget and finance includes just under 300 budgeted fte for fiscal 2425, approximately 50% of whom are represented by one of the city's labor unions. The total service area budget of approximately 1 billion, as reflected in the adopted budget, is a little bit complicated, as it includes large amounts for administration of things like fund management, certain types of debt payments, fund transfers, and the like. What that means is the actual operating budget, the operating expenses that are in that middle column, mostly personnel and material and services, is 438 million. And after removing the trust pension component, the component for those payment benefit payments, the actual operating budget of the service area is closer to 250 million. With that quick tee up, it's now my pleasure to introduce you to the key managers and teams that perform those critical functions to keep the city running, beginning with the revenue vision and thomas lannom.
3 Thank you jonas. My name is thomas lannom. I'm the director of the revenue division. It's a pleasure to be here this afternoon. The revenue division is a full service regional tax collection agency. We collect on behalf of not only the city of Portland, but also metro Multnomah county and numerous other partners like travel Portland, the three enhanced service districts, and certain bureau programs across the city. The city is not it's not. We don't have a completely unified collection environment in the city, but most of the tax collection programs, certainly all the fee, any of the fee programs are, are within revenue. Excuse me. We collect about $155 billion a year. We have about 150 fte, most of which are in three divisions. The tax division is the primary customer service division. These are folks that answer phone calls and respond to emails and review taxpayer correspondence and enter tax returns. Then the audit and accounting division does exactly what it sounds like. And then our business solutions division, which is a relatively small group of dedicated professionals helping us to try to get smarter and better in terms of how we go about doing things with our technology. With that, let's go to the next slide. I won't linger here long. This is just a pie chart showing basically the revenues that we collect. As you can see, business taxes are the bulk of the collection. That's the large blue wedge followed closely by personal income taxes and then PCEF. And then there are a couple of other pieces in there, including all other, which really includes a large body of other citywide receivables. About 50% of the 1.5 billion we collect a year is for the city of Portland, either the general fund or other bureaus. And then the other half goes to our regional partners, principally metro and Multnomah county. This last slide is just a high level of some of the metrics. We have about a million pieces of annual correspondence mailed each year, 116,000 phone calls and 30,000 emails, lots of tax returns. So I think, you know, the takeaway that I'd like you to think about is as we move into tax season, your offices are going to receive a complaint about how someone interacted with our office. And sometimes that will be our fault and sometimes it won't. But I just want to assure you, all of you right now, just to know that that is something that we're very working very hard every day to make sure that we try to give people quality interactions, fast response times on the phone. We don't always get it right. But when you do see a complaint, give us the benefit of the doubt and we'll be happy to get as much information to you as we can within the confines of state law, which protects taxpayer confidentiality. Briefly, we have three key initiatives. Right now, we are doing a top to bottom review of all of our correspondence. We have had some instances in the past where there were taxpayers that were confused by correspondence that they received from our office, and that's absolutely not where we want to be. So we're reviewing that top to bottom. The most recent effort was a complete rewrite of the of the arts tax annual reminder that goes out to all households in the city. We are also working closely with tax preparation software platforms like turbotax to get fully implemented across their suite of products. I'm very happy to announce that turbotax is finally this year, after more than five years of working with them, agreed to carry all of our personal income taxes from the arts tax to the metro, Multnomah county personal income taxes and business taxes in their product. And they've started up a new landing page. So instead of having to select Portland after pennsylvania and kentucky and other places, there will actually be a landing page. So if your return has a Portland or regional address in in the metro area, you'll land on a landing page that will show you the local returns or give you the chance to say, no thanks. I don't want to file any of those, but they will all be presented as an option. We are carried in eight other tax preparation software products. I'm not here to talk only about turbotax, but they are the market leader. And I did think that that would be something that you would want to hear. And then finally, one of the things that we've been doing since 2020 is trying to consolidate the various revenue collection platforms that we have across the city. We used to collect hotel taxes on one platform, personal income taxes on a different platform, business income taxes, and so on. Enhanced service districts. Those are all now collapsed onto a single integrated tax system. So we have a whole view of the taxpayer. And so currently now we're working on consolidating the putting placing the liens collection platform onto our integrated tax system. Thank you. Great.
4 Thanks, thomas. Now we'll move to bridget o'callahan, the city treasurer.
5 Great. Thank you again. Bridget o'callahan, city treasurer. Thank you for the opportunity to be with you today. I'm responsible for both the treasury and public finance functions of the city. The treasury division is a centralized banking services function. So we service all city bureaus, areas, programs and also prosper Portland. The division's functions include managing the city's daily cash position, maintaining custody of the funds, and ensuring that excess funds are conservatively invested to earn a market return. The funds. All funds for the city come in or out at some point of the city's treasury function. They're held collectively in a pool and managed as a pool. We provide services for the various bureaus and programs to both collect payments, to accept payments, and also facilitate the depositing of all public monies into the city's bank accounts. We also facilitate the payments that go out on behalf of the city. So the disbursements that are made, as well as the investment program, our objectives with regard to the investment program are, first and foremost, to preserve the principal. We want to make sure that the money is there when we need to process payments. And secondly, it's to ensure that liquidity, that it's there again when we need it. And then finally to earn a market return. The treasurer is also the administrator of the city's foreclosure process, so I'm sure we'll have an opportunity to share more information about foreclosure, specifically with all of you at a later date. As you'll see on the slide, the city presently manages an investment portfolio of $2.3 billion. In the last fiscal year, we earned approximately $101 million. On that, you'll see our portfolio yield history to the right. Again, our focus is on safety and security of the funds, making sure that we're earning a market return. And importantly, I believe, to talk about is that all of the yield on the city's portfolio is returned directly back to the bureaus, directly back to the funds, and into their budgets. We may have the next slide. I'm also responsible for our public finance division. And joining me in the room today is the city's debt manager, matt gierok. I'd ask matt just to raise his hand so you'll see that he's joining me here today. I've asked matt to be along in the event that you have questions that are specific to the city's debt portfolio. So public finance, sometimes referred to as debt management as well, directs the city's financing activities. So this is where we raise capital for public infrastructure projects. We acquire equipment, facilities and refinancing of the existing debt of the city. The city's debt consists of publicly issued bonds as well as private placements of debt obligations and various loans and other credit facilities. The primary driver of the city's borrowing is that we focus on borrowing at the least cost, most cost effective borrowing, as well as the least risk to the city in terms of how we finance transactions. For more than 40 years, the city's unlimited tax general obligation debt has been triple a rated, which historically has been something that's been very important to us. The debt rating is important in the sense that it does allow us to offer that the most competitive prices. With that, you'll see on the slide that in the past, oh, about 18 months, we've issued $755,000,759 million in bonds and loans for city projects. And over that same period, we've refinanced 412 million of existing bonds to generate a savings of $21 million for the city. You'll see to the right on that slide, the distribution of the city's existing debt. With that, I turn it back to you.
6 Great. Thanks, bridget. Now we'll hear from business operations. Aaron.
7 Thank you. My name is aaron rivera. I'm happy to be here today. I am the business operations division manager, the business operations division performs three core functions budget and finance service, accounting service, and employee and personnel service. To bureau leadership. We are organized into six teams, each having a single point of contact for management partners. Our budget teams provide financial analysis, development bureau budgets, prepare capital plans and decision packages, monitor the budget, and report financial activity. Our accountants pay the bills, send out the invoices and perform other general ledger work. Our employee services team processes time sheets to ensure that staff are paid correctly, help recruit, hire and onboard staff, as well as problem solve issues for management. We lead projects of all shapes and sizes. We are funded by the customer bureaus. We provide service to. We in a real sense see leadership and our bureau management customers. As our customers. We work hard to earn the confidence and operate as trusted business partners. Next slide. This org chart highlights our customer bureaus and organizations. We are a centralized service provider for most organizations in the highlighted areas. We are responsible for either the financial support or personnel support. For $1.1 billion in appropriations, just over 660 fte, 17 funds, ten bureaus. And this includes the 13 elected officials, the city administrator, and two deputy city administrators. Thank you.
8 Great. Thanks, guys. We'll do a quick set change and get the next round of folks up here. And then just as a reminder, we'll do three more here from three more folks, and we'll pause to collect any questions on this body of work. And next up will be sheila craig in grants management.
9 Good afternoon, sheila craig grant manager. And I like to call our team the one stop shopping for everything related to grants. So we have 13 fte. And on our team budget of 3.6 million. And that does not include all of the incoming grants in the city. That's just my team's budget. We have four teams the application coordination team, incoming grants, team, outgoing grants, team, public assistance, disaster recovery team. Our application coordination team is responsible for identifying funding opportunities for bureaus, funding, identifying, I'm sorry, identifying funding needs and aligning those with funding opportunities, and working with our bureaus to submit grant applications for possible revenue to the city. Our incoming grants team. We oversee all of the federal, state and private grants that come into the city of Portland, and we manage those from the complete life cycle application to close out of those grants. And that's in close coordination with all of our bureaus outgoing grants team. This is a newly formed team. We passed a outgoing grant policy in the past year, and we are working with the bureaus to get everyone online on a system called web grants. So we will have all of our outgoing grants in one system at the city. This has been something we haven't had in the past, so we will be able to report out all of the grants that are going to our outside the outside community and then public assistance disaster recovery team. I have a small team that if there is a disaster declaration, we all report to the city's emergency operations center for the finance team, and then we lead all of the federal reimbursement and recovery for the city of Portland during a disaster declaration. Small teams, small presentation.
10 Great. Thanks, sheila. And next, john maloney, the city's controller.
11 I, john maloney, the city's controller. We cover accounting. We're broken into three teams. There's technical accounting, operational accounting and financial systems and training. The operational group reviews the city's payable transactions and about 150,000 transactions or invoices a year, to about $2.1 billion. The technical reporting team produces the audited financial statements, abbreviated as the actor, and helps with interpreting gasb rules, which are generally, excuse me, governmental accounting standards boards, interpretations of how accounting should be done, and the third team, financial systems and training, of course, provides accounting, training and expertise throughout the city and does the kind of technical production between the accounting entries and what's needed for the city's erp system, sap. Let's see. I think that's that's about it.
12 Great. Thanks, john. And then last online is patrick hughes in risk management patrick.
13 Yeah. Thank you jonathan. Pleasure to be here. And I apologize for not being in person, but this was the day the contractors came to fix the heat in the house. And they just finished cutting a hole in the wall. So we timed it very well. I am the city's risk manager. Risk management is a very I will agree with the term lean. We have three groups of teams. We have insurance and loss prevention. Risk management manages with a broker and seeks out and purchases all of the commercial policies to protect the city. We look at what is the what is the risk and how much policy we can afford and the limits. We are currently buying 36 to 37 different policies to cross over all of the risks that the city does have. In addition, we manage all of the liability claims management. We have a group of nine who adjust and manage all of the claims and work in conjunction with city attorney when there is a lawsui. Currently, open liability claims are targeted. About 450 open claims. In addition to that, we have about 560 subrogation claims that are run by that unit, and subrogation is where damages have been incurred to the city, and we attempt to collect those back for the bureaus. Thirdly, we have the workers compensation claims. We do all of that internally for all city employees. We have about 500 oh, excuse me, 339 open workers comp claims both liability and worker's comp claims can stay open, sometimes for years. So the number is not staggering. But it keeps us very, very busy. And the last thing we do is basically, at any given time, run around complete risk assessments, give risk transfer advice, risk financial advice, whatever is needed to all aspects of the city internally to help solve and create solutions for them. So thank you very much for your time.
14 Great. Thanks, patrick. Just a couple quick quick hit slides here. Won't go into these details but wanted to highlight some of these have been mentioned. Just a few recent accomplishments of the service area. The examples here show how the work that we do promotes stability and financial sustainability, how it evolves in response to emerging needs, and implements technology based solutions. On the stability side, we've continued to manage the city's finances and debt issuance to retain the top edge triple-a credit rating. Despite a number of emerging challenges, some of which are out of our control. We also received, for the 43rd consecutive year, the gfoa certificate achievement and certificate of achievement in financial reporting, and we also had a clean grants related audit. Once again in response to citywide transition, business operations developed a new team structure to support a high volume of reorganization efforts occurring citywide. And as sheila mentioned, we have a new outgoing grants policy approved in fall 2024, currently under active implementation, and then couple of technology related items. We have now the risk of enhanced risk management system to better monitor, manage and communicate risk related issues and claims. And as thomas mentioned, working with our technology partners on tax collection issues. And so that's been a long, long time project to finally get over the over the transom here this tax season. And then the last slide here just we have a lot of work to prioritize. We're not going to walk through these but but many of these have been sort of chugging slowly in the background waiting for us to get to this moment of having a new alignment in the city where we can actually now begin to make progress on implementing many of these best practices and enterprise improvements. So, so really optimistic that the new city approach, along with the ability to work collaboratively with all of you under this new alignment, will put some wind in our sails on moving many of these and other efforts forward. As promised, we'll pause here for a little bit and can take questions from any of the folks you just heard from. Before we move to the next part of the presentation.
15 Thank you, jonathan, and thank you to your whole team, councilors. We do have three more sections that we'll get to, including notably budget. So let's hold budget questions right now. But questions on these programs we've heard from I think are important to get through before we get too far. Councilor Clark, would you like to kick us off?
16 Thanks. Madam president, I have a question. I think for thomas, I was just curious. There was no mention of the. Can you talk about our relationship with the tax? Is it the tax supervising coordinating commission? Maybe that's not.
17 A yeah. Tax supervisory. What's the other see ruth. Coordinating coordination. Thank you. So it's actually the tcc is a budget related body. So they will be engaged as we go through the budget process. So ruth will probably talk about them I think a little bit. And you'll certainly learn more as we go through that, that budget process. I don't know that there's really a direct role related to revenue collection.
18 But I understand the title of it. Tcc tax sounds like, no, they don't collect taxes.
19 Okay, okay. Well we'll get we'll get to that later. I wanted to compliment you. I got my arts tax form in the mail. It seems much better than it used to be. So thank you for that. It was really easy to file. This is a kind of a high level question is with changes that are going on at the federal level with the irs, what do you foresee any impacts on us with that? Those changes.
20 Right now? No, we do have a data sharing agreement with the irs where they will share with us local taxpayer information, specifically financials from prior year filings. We use that information to enforce our local taxes, to make sure that we're seeing what we would expect to see between a federal filing and a local filing. I have not heard of any reduction in that office area. Certainly, some of the things that I'm reading are alarming to me as a as a tax administrator. So we're tracking that closely. But right now I've not not forecasting any direct impact.
21 Yeah. And it's a great question. Councilor that I mean, obviously there are lots of rapidly evolving, worrisome activities happening at the federal level. And so we work really closely with the staff within their areas to keep an eye on that, to identify anything upcoming of importance, and importantly, working with other regional partners to make sure that we're moving in alignment as far as administration and thinking ahead about any actions that we might need to recommend.
22 Great. Glad you're ahead of it. One, one last question on the incoming grants team. Does this include, like the money that comes from the state through, you know, ODOT funds, all those kinds of dollars? Is that what we're talking about when we talk about incoming grants?
23 We'll get sheila up.
24 Thank you. Yes it does. It's all federal, state and private that come into the city.
25 Okay. Great. Thank you, madam chair. Thank you.
26 Councilor Green.
27 Thank you, madam president. So on the slide on debt, debt management, there was a mention of use of credit facilities. Can you say a little bit more about the credit facilities that we use? Like what's our line of credit. You know we have a policy around that. How often do you use it.
28 Yes. We'll have the debt manager come up, I will say as his as matt is coming up, we don't necessarily keep a line of credit that we just have. Like you would use a credit card that usually those are for very specific dedicated purposes that need have a short term cash flow need. And so matt I'll let you introduce yourself and.
29 Hi. Matt gurock debt manager. Yeah, usually those are done on a project by project basis. And so, you know, during a construction period of a project, we kind of use a line of credit pretty frequently so that we avoid like over issuing long term bonds. So once a project's total cost is known, then we will bond it out with long term bonds. So that's the typical use of credit facilities okay.
30 Thank you. So it's not sort of a part of a reserve strategy.
31 No. Yeah.
32 Thanks. Can you describe a little bit about the debt issuance strategy. Do you is it piecemeal on each project or need to issue a bond. Or do you have a portfolio approach.
33 It depends on on the bureau that's borrowing. So for like water and sewer it's a portfolio of projects typically. And then if it's like for facilities it's usually like a specific project for like the Portland building or something like that. So yeah, those are the examples that come to mind.
34 Thank you. And I know this is governed by our debt policy. With the new form of government. Jonas, is there any thinking around saying, let's move this out of bureau driven debt management prerogatives and into sort of a sort of a more holistic.
35 So, to be clear, we do have through treasury and through matt's position, specifically a centralized management of that function. So the way it would typically work is a bureau or a program would say, hey, we have this need or idea around debt, and they would go to that central function, that enterprise function, to facilitate that conversation, specifically to avoid multiple, you know, maybe competing priorities from from different bureaus under the new alignment, certainly some ability to improve that. And so one example that we haven't been good at in the past is maybe voted geo bond requests, where in the past that might be driven by a bureau and a commissioner in charge and get a little bit down its own path. And so we're now taking an approach under the new alignment. It unlocks the ability for us to say, hang on, let's actually have a comprehensive conversation about what that full body of need is over the next decade, and develop an actual city strategy around that, including working on at one point, including working with our regional partners to sort of get a lens on what do they have coming as well. So that is an example of what of an opportunity that we're taking advantage of under this new alignment.
36 That's great to hear. Last debt question what's the average term term structure. And, you know, repayment schedule of the debt that we issue.
37 It varies based on the type of asset. So for instance, like a building that has a useful life of like 30 or 40 years. So we would have a longer term if it's something like for example, like if we like when we finance like the city's erp system, you know, software has a shorter, useful life for that. So for something a project like that, it would be a shorter term, like, you know, 8 or 10 years. So it's largely driven by that. And then also for the utilities, I mean, those are long lived, you know, long lived assets. So those, you know, those are typically longer terms.
38 And do you do you tend to repay it earlier than the life of the asset or the issuance term?
39 Yeah, I think so. Yeah. We've typically done like 20 year terms as a standard term for.
40 Yeah I would say councilor I mean almost always if not always paid off before the useful life, because the term of the financing is shorter than the actual useful life. If the question is, do we pay the debt off earlier than its maturity? Probably less frequent, but we do. As bridget mentioned, we're always looking for opportunities to refinance at lower costs. And if there's a revenue stream that does allow us to pay that debt off early, we do want to do that. You know, there are limits on the capacity. And so to the extent that we have an ability to pay something off early, it opens up capacity to potentially fund another incoming need. So just another advantage of having that centrally managed as we can keep a lens on on all of that happening simultaneously.
41 Thank you. That's really helpful. And then I've got just a brief credit risk or a risk management question. Do we have a credit risk program? Like when we think about our procurement relationships or supply chain relationships and any kind of transacting we might do, do we does our risk management section also evaluate counterparty risk?
42 Yeah. Patrick.
43 Did I turn on I believe so I hope you can hear me.
44 Yeah. We got.
45 You. In a sense, yes. Not not in the direct way the question is phrased. However, risk management is going to work with procurement to go through basically all of the contracts, indemnity insurance, looking at mitigating all of the risks that come to us with whatever procurement action is in place. However, risk is not involved in seeking out vendors and the like.
46 Okay. Thank you. Yeah. I'll yield.
47 Counselors I apologize. A few of your colleagues just flagged for me that the order that your hands ar shoulder. For the order for folks to ask questions.
48 Yeah, it should be.
49 Specific information. Councilor. Also just worth noting that that to the extent that that general fund backed debt service payment coming up is more or less than the current year, that will already have been reflected in the in the forecast.
50 Yeah, I'd just like to know what it is. And as you know, luba has stopped our work on the water treatment facility. And if any of those above accounts would we have to if we had to start paying for that ourselves or go out on the open market because we can't use the federal funds, would we have to bond in one of those funds that you talked about earlier to pay for that?
51 In theory, if we if we as is the case right now, we're not drawing from the wifi alone to fund that project. And we and we, the city, the water bureau needed resources that were not available in other fund balances. Et cetera. Then we could look to do a second borrowing facility. For example, a question on the line of credit could be an option to have a short term facility to allow those critical capital investments to happen. While we wait for that federal issue to be resolved so we can go back to drawing on that.
52 And so I would be really concerned if we went out on the open market with a line of credit, with the thought that we would eventually be approved by Multnomah county. And if we're not, then we're we're going to be, you know, at a minimum of $500 million in debt, that we don't have any place on the federal or state level to draw against. And the question would be, would you bring that in front of council before you all did that?
53 Yeah. Good question. I say, I, I think so, so I do believe there is an existing authorization for up to a certain amount. I don't know what that number is from, from a prior water bond authorization. So we'd have to consider whether that, you know, requires council. And if it doesn't require council, what's the path forward? If it were something that were. Different obviously from what that authorization allows, then it would have to come to council. We wouldn't be able to issue without that.
54 Yeah, because the concern would be that if we have to stop construction for the next 4 to 6 months, we're behind schedule, we have a $2 billion project. And so that could cost us anywhere from 500 million to another billion dollars to be able to finish this project. And if we were to go on on an existing line of credit without any ways to paying that back, because let's just say we lose that case, then that's 500 million or $1 billion on top of the $2 billion that we're going to have taxpayers pay. And that that will be a huge, huge liability. So I would think I'm just trying to put this in your mind before you make that jump, please come before us and let us know that that's what you're thinking about doing, because I'm really concerned right now about this, because I, I don't know how we got to this point in the whole process. And now we're being told that, you know, we have to stop everything. But if we have our own money and we want to keep going, we can. So for me, that is a that that is something that I think we need to prepare. And the last question would be under your fund, disaster control fund. Does the ARPA money go under those that that particular fund. What fund is the ARPA money put into.
55 Yeah.
56 Under the grants.
57 It's in the. Grants fund.
58 That would be in the grants fund.
59 Exactly. But what specific fund does the ARPA money go under? I saw disaster control. I saw some other things under the grant which.
60 All of them are in the grants fund.
61 So you have so there's no desegregation of any of those different.
62 The funds have their own sub fund. So aarp has its own sub fund. So depending on the funding source we have multiple sub funds within the grants fund.
63 But but actually they're they're called under the grants fund.
64 Under the grants blanketly.
65 Under the grants fund.
66 All of it's in fund.
67 217 yes. Thank you so much.
68 Welcome. Thank you.
69 Counselor Zimmerman.
70 Thank you. This question is related to risk. One of the things I hear often from the community is that to hold an event, it can be difficult to gain insurance. And just navigating that right. If you're going to buy insurance for a five hour period, that's just a weird thing. Most people have never done that right. The other group that I hear from is some of our neighborhood type groups who kind of expect that they'll be getting insurance through the coalitions, but continue to find difficulties that that make that an expensive endeavor, and also one where they don't have a lot of confidence that they did it the right way. So when I think about trail groups, parks groups, any other group who's going to use a Portland public right of way? I'm curious from the risk world, if you all and we don't have to answer it here, if you if this would be the right venue, meaning the risk management venue to dive further into that area of our work within the community, or if it is better to go talk to parks about that difficulty versus the risk group.
71 Yeah. Patrick, do you want to talk about how your role in interaction with with bureaus in making those assessments?
72 Yes, there's two hits there. Thank you for the question. One is if there is an event happening by a outside community organization to keep it simple, we do offer them the availability to purchase very, very cheap liability insurance, which would meet their requirements for insurance and indemnity so that that is there as an offering that they can. And I know it sounds bad to say we're buying insurance for five hours, but that's kind of the world we live in now with all of the litigation that happens. Then the second side of that question is if the city is managing and operating the event, then risk management is indeed covering over the top in. In that example, the parks bureau for what they do. So the insurance is actually not a problem from the sense if we are managing it as a city, because I already have coverage on top. So it's really situational. And we do have options for community members that are very much cheaper than your local insurance, you know, salesperson and or broker. But, you know, anytime drop us a question. I can make that even in more detail.
73 Thanks. I think what I will just flag is that it sounds like this is the right area of work to get into this. If we can make it more clear, more user friendly, and a selection option that that working with you all versus the individual bureaus makes sense. So I will I will flag that this will likely be an invitation from the finance committee eventually to come. Let's let's work this out. Right. A thousand bucks is cheap in an $8 billion organization, a thousand bucks to a show happening in pioneer square is an incredibly expensive endeavor. So hey, thanks for that. I really appreciate it, patrick.
74 Thank you.
75 And then last question. With it comes to our housing bond, I hope that there's been some areas of this that I'm a little confused about, how we manage the bond and whether we could go out again for it and at the right time. What I would ask is maybe just add this to an area for future work to come in front of, perhaps the finance committee, but also the housing committee relative to how we plan out our debt and how we can issue those bonds. I'm a little unclear about that versus how some other governments have done it, so that we can ask voters for the same rate without a gap. And we are experiencing a gap right now. And that's about where I start to lose the thread a little bit. But it sounds like it was pretty important to us in terms of keeping the work going and that we're in this glut right now. That's we got to figure out a little bit. So just flag that for additional information needed. Thanks, madam president.
76 Councilor canal.
77 Thank you, madam president. Thank you dc and team. And I'm going to piggyback off of the first question from councilor Zimmerman. And most of my questions do relate to risk management. So I did ask parks this exact question because I reject the notion that we are cheaper than pure cities. I play dodgeball, I've said this a lot, and there's no dodgeball in city community centers in Portland. And there's a reason for that. It's because of the high costs associated with having it be in a local park or community center. There's occasional seasonal or one time events, but the and that has largely to do with the cost of insurance, which is something we heard over the course of the last year from a lot of community groups as well, to book a soccer field or something like that. Parks specifically directed my question to risk management as the main driver for setting the amount of insurance required. And I can say that from my own experience booking a park, that the suggested vendor was not as affordable as finding a third party in at least some of the cases. So I'm curious, as a comparison to other cities, why we require higher amounts of insurance. And as it relates to parks specifically.
78 Well, I guess I guess my first comment would be I'm not aware of the difference between the different cities, so I can't speak to that. I would hope we're we're obviously close or or better, but I but I can't answer that. The bigger question is really how do you set minimum insurance limits? And when you when you look at that, you have to go into what's called the Oregon tort claims act and start to watch the level of risk that we are financially responsible for under the Oregon tort claims act, for any type of injury lawsuit which has been climbing and steadily climbing throughout the years and will continue to climb. So a lot of public organizations in Oregon who are under that act are setting their limits at or near that, because that's where they are protected. And insurance is on top of that. I can tell you that that's held much lower than different states who do not have such protective caps, but I would have to look at that in more detail to say, where do we fall in terms of cost and price? So we'll certainly be willing to do that. But I couldn't give you a clean answer right now.
79 That's that's totally fine. And I'm happy to send the Oregon specific info that I do have. You messaged that you mentioned that in subrogation you tried to recover money for the bureaus. And I'm curious as to where when we pay out a settlement, if you could speak a little bit to how the cost of paying out that settlement comes from the bureaus that are being. Well, the city is being sued, but the conduct of the bureau is what the grounds for the lawsuit ostensibly was. Can you speak a little bit to that?
80 Are you asking for how we collect or how when we have to pay.
81 When we have to pay?
82 Okay. The simple answer is if we if we have a claim against the city, and it appears that the city either did not do something or did something wrong, and we have to make a settlement, the easiest way to think about it is if I pay a certain amount of money out of the claims fund, then the bureau who was responsible. And I say that in quotes for that loss happening, is then charged over four years to break up that settlement that was taken care of. And that way they can actually budget for it over the next four years to make up the costs that the claims fund fronted the settlement for.
83 Thank you. Third question I have for total, would you be able to provide with some prep time each time you present a potential a proposed settlement at council, the aggregate amount of paid out settlements for that bureau over the last year, over the last five years. Et cetera. And I ask you this with the intent to ask you this for all future settlements that come to council for approval.
84 Yes. With the new system, we can mince our data in any way that you would like to have it. And if you were asking to say if a settlement comes to council for parks to settle a singular claim and you have a long side of that information saying this is what parks has paid in the last year, or whatever you want it, we can certainly create that without too much problems at all now.
85 Great. Thank you. And then my last question is on the investment side, this was on slide nine. There was a depiction of the yield. And it looked like and I think I was reading this as annualized is about 3%. And I'm curious if that was adjusted for inflation, if it basically I'm curious why if that is as low as I think it is, why is that as low as it is? Is it due to risk tolerance levels or is it based off. Because if this was invested in the s&p, it'd probably be 8 to 10% a year. So I'm curious as to why that was.
86 Yeah. Happy to answer that question for you again. Bridget o'callahan, city treasurer. The city's investments are governed by the city's investment policy, which is also governed by the state of oregon's requirements for public funds. And so under those, the types of investments that we're allowed to use for the city are very restrictive. And so that's why, if you think about this, as you know, our focus is on preserving that principal. That's our first and foremost. We want to make sure the money is there when you need it. And then we want to earn a market return. And so that's why you'll see that.
87 I have something that's later on I think that will be relevant to you, but to another program as well.
88 Thank you.
89 Councilor Novick. Go right ahead.
90 My question is also for treasurer o'callahan about our investments, and I'm afraid it requires some shaggy dog history. 10 or 11 years ago when I was on the council, I, we were in we invested in corporate bonds, and I decided to try to convince my colleagues that we should invest in the bonds of really bad corporations. So first we said we weren't going to invest in walmart bonds. And then I tried to get us to say we wouldn't invest in the bonds of the five worst corporations, according to some ratings agency. And then people said, well, what about fossil fuels? Et cetera. And finally, the rest of the council decided they didn't like to keep on trying to figure out which corporations were all that bad. And my recollection is that dick fish introduced an ordinance to say, we just won't invest in corporate bonds at all, which to me was the worst of both worlds. It seemed like we were, you know, putting leaving money on the table, but also not sending a signal that some companies were unusually bad. So, like, where are we now? Have you gone back to investing in corporate bonds? Do we not invest in them at all?
91 Great question it. Over the last 15 years and the six that I have been with the city, we have looked to guidance from council to identify something that's that allows us to live up to the city's values, to your point, but also not forgo the opportunity for growth in our portfolio. And so what we've arrived at is a process of allowing a very select group of corporate bonds within our portfolio and eliminating the use or the investment in certain industries. So we looked at fossil fuels, for example, private prisons was another area that we focused on. There's a variety of industries that we have essentially prohibited. So that allows us to be very thoughtful in terms of how we invest our funds, making sure that we're, you know, living up to the spirit of what council and our community wants us to be investing in. Does that answer your question, councilor?
92 Yes, that's an evolution. Thank you. I'd love to like look at the details later, but I really appreciate that.
93 Certainly welcome your input.
94 Councilor Ryan.
95 Sure. Thank you, madam president. Let's see. Mine will be thomas, you're up there. There'll be one for you, too, sheila. Just so you'll know. First of all, I just want to thank you, thomas, for the customer service implementations that you've made, especially around the arts. Tax. I feel like I should do that in public, since I had quite a few meetings with you about this in the past.
96 I appreciate that. And if I may jump in just for a moment, councilor, I would say that I would be remiss if I didn't point out that our central pio office helped a great deal with with that effort, so thank you.
97 Good, good.
98 Now to that point, will the tax preparers will they were they all informed about this so that they can tell their clients that they've handled it?
99 Yes.
100 You don't even know everybody. My colleagues this is really wonderful news. So anyway, I think I speak for many portlanders on that. And also just when I had a year oversight, I that's probably the main thing I focused on. So I'm happy to hear that. And I know that you are working really hard to implement this for this tax season. So thank you. Thank you. You're welcome. We provide so many robust services for metro and for the county. And I'm not trying to make profit off of those services, but I certainly don't want to hear that we lose a lot of money with that. Can you just tell me a little bit about the ins and outs of the transactions that we do for our partners?
101 Sure.
102 So and we're and we're continuing to do good customer service. That explains that this is not a city tax, but it's for this tax.
103 Yes.
104 That was our other conversation.
105 So we do have what we call an integrated tax system. And we do that on purpose because it saves all the jurisdictions money. So we jointly administer the personal income taxes, the business income taxes, wherever there's an opportunity for uniformity. We grab on to that and we try very hard to keep it simple, because if it's simple for a taxpayer to understand and comply with, it's simpler and less expensive for us to administer. So it's a win across the board. The compensation that the city receives for those services is just the cost of the service.
106 So it's.
107 A wash.
108 Yeah, it's we have an intergovernmental agreement. The city, all the partners do realize some benefit. For example, we have some bonded debt service related to our implementation of our our database. A few years ago. All the partners pay into that. And when there's a new tax created, it reduces that that the bonded allocation, the amount of that debt that's allocated to partners. And so there is an opportunity for as we scale up, the costs actually go down across the board for everyone that's on that platform.
109 Thank you so much. The last question is for you, sheila. I know we started to peel the onion, if you will, on transparency and accountability. With our private grants that we send out. We started with passing what you mentioned, the transparency around financial and financial statements of those organizations. So when we when now that we require that, how will I as a legislator and how will the community who is looking at who we're sending money out to see that same transparency. So you could see if we're sending 2 million to someone, the taxpayer, the people that pay our rent up here, if you will, could also see current financial statements of those organizations.
110 So we're in the process of the implementation of web grants. And our goal is that all the bureaus will be online with web grants starting seven, one, 20, 25. So we've kind of given everyone a, a time period to say you have to be online by then. So as of seven, one, 20, 25, all of our bureaus will be utilizing web grants, and it will give us that ability to do more robust reporting across the city.
111 Okay. Great. Thank you sheila. That transparency and accountability will go over well, I think with all constituents. And then I look forward to more on this as we peel the onion in terms of also making certain that we really are clear about what the strategic goals are and what they're going to measure. So we can have that same level of accountability we try to bring to our bureaus, to our outside partners.
112 Right. And we've also developed a reporting guide. So we will have some consistent reporting across all of those grants, all of the outgoing grants.
113 Thank you so much.
114 Councilor Avalos.
115 Hello. Thanks everybody for all this information. I feel like I missed one thing about the turbo tax, and I wanted to understand what exactly are we doing with turbotax, what's our relationship with them.
116 So we have a partnership with intuit which owns turbo, the turbotax product. And we also have partnerships with a number of other tax preparation software products out there. So it's not just turbotax. They just happen to be the market leader. And one of the things that they've done that's this year that we're really happy about, is there will be a landing page for Portland area returns. So in previous years, if you filed your state return, you would be asked possibly if you wanted to file any other return and you would hit a button and you'd see a drop down menu of things that may or may not have made any sense to a Portland taxpayer. Now, what I've seen at least demoed for us, and which should be live certainly by this Thursday, if it's not already live, is a landing page. So if you file a local Portland return, you'll be presented with a page provided that you also have the state level return, the Oregon return, and that that page will give you the option to file any of our local returns. The arts tax return, thank god the Multnomah county personal income tax return, the metro personal income tax return, and any other local return.
117 So this is just for the Portland area things. And this is just for people who use turbotax. Am I understanding?
118 That's right.
119 Are they.
120 The other products that also carry our taxes? There are a number of other products that also carry our taxes.
121 So but then to use their service, there's a fee, right? That's correct. That's forcing portlanders to use that. They don't have to do that, I guess is my question.
122 Oh no ma'am, they do not. So we have a free file option. It's on Portland revenue online. Any taxpayer can go there and file their taxes for free. They can also pay their taxes for free if they use the ach option. So it's all right there for anyone to use. They don't have to use those products.
123 How are you marketing that to people? Because let me just tell you where I'm coming from. Turbotax is expensive and we should not be paying to file our taxes. So that's a general value that I have. And so I'm concerned that we're relying on a business that uses this model to force people to, or there's all these hidden fees to file your taxes. Yes. And now we're, you know, partnering with them to offer some kind of landing page, which I get is great in terms of streamlining, but it concerns me in just furthering people away from the free resources. And turbotax is notorious for hiding their free page. They have one. It's very hidden. So I guess I'm trying to understand, like, is there how are you going to be advertising other options so that people do not think that they have to pay for that service because they don't?
124 That's an excellent question. So in our arts tax letter that was just revamped and went out this year, we highlight the free file option, making sure that people understand that that's the way they can file and pay our press releases that will be going out soon. And our partner, our communications with our partners will also highlight that opportunity to just simply go to Portland revenue online. So there are a number of different ways that we do that in the tax administration world. We cannot afford to pick and choose how a return gets to us. We still accept paper returns, believe it or not, tens of thousands of people returns every year, despite our best efforts through social media, press releases and, you know, good technology that's easy to use. We try hard to market those other less administratively expensive channels to file returns. But there are still a lot of people doing paper returns, sending paper checks. So we will take a return any way that it will come, be it through turbotax, the free file option or or paper.
125 Okay, then maybe I'll just end with a potential ask that I can follow up with you on. I would love for that Portland landing page of turbotax to clearly show links to where they can go to not pay. So we could talk about that offline, but I feel like, yes, that's great. You know, there's all these different ways. But, you know, turbotax funnels people through their system because they want them to pay. And if you're landing on this Portland page that looks all branded, it makes it feel to the average person that it's required and it's not. And so I'm concerned that we are just per, you know, by not being clear about the options and having the options on that page is particular to me. So we could talk about that. But that's my major concern that portlanders aren't going to know how.
126 To be happy to partner with your office on that. And there is a none of the above box right there on that page. They don't have to use that channel, but we can talk more. Thank you.
127 Thank you.
128 Councilor Novick did you put yourself back in the queue?
129 I did, I just wanted to weigh in here. Councilor Avalos I mean, I think that people will only run into the turbotax Portland page if they've already decided to start using turbotax. So it's a matter of for those people having the convenience of doing their Portland taxes all at once, whereas those of us who don't use turbotax will continue to file like one return after another with different governments, or go to h&r block or something, which you know might charge us in a different way. But I think that, I mean, as having a Portland page in turbotax, I don't think, pushes anybody to use turbotax. It just means that somebody who already is using turbotax won't go through it and say, oh my god, now I still have to do this separately. The arts tax and the preschool tax. Et cetera. Et cetera.
130 That's correct.
131 Go ahead if you'd like to respond to that. Councilor.
132 Yeah, I totally understand that. I think my concern is that we are partnering with this. It's this big thing. It's going to be advertised on our channels. And so it just, again, feels like it's funneling people that way. And so I want to and I haven't looked I will look at the tax page and kind of how you lay out your resources. But I want to talk through how we make clear what the options are. Totally agree. If somebody is already using turbotax and it's auto populating, I think that's great. But if we are trying to funnel people there, either directly or indirectly, then that's where my concern lies. And I can follow up with you about that. Thank you.
133 Thank you.
134 I think we will let you get back to the rest of the presentation now, so that we can ask questions about the other portions of your service area.
135 Great. Thank you for that. Hopefully folks don't go far in case there's other questions later. So the next group will have our fire and police disability and retirement fund as folks come up. So we will hear from the director of sam hutchinson.
136 Am I on? Yeah. Hello, I'm sam hutchinson, bureau director of the fire, police, disability and retirement. You may have heard us under fpdf. It's a lot easier to say for you all. So thank you for the opportunity to talk with you about what our bureau and our fund are about. We serve the city of portland's active duty firefighters and police officers and their survivors. We do not serve anybody else in the public. That's our sole people. We serve our responsibilities and our plan design and the benefits we offer are defined in chapter five of the city charter. And as you can see down here under the programs, we have three programs. So the benefits we offer come under one of these three. So we have the npdr one and two pension benefits for npdr one and two members were hired before January 1st, 2007. So their retirement is paid from the npdr fund. If npdr three pers contributions, the npdr three members are those that were hired 2000 or excuse me one. January 1st, 2007 and after. They are in the pers pension system. But npdr pays the pers contributions for all other bureaus in the city besides police and fire. Those contributions come from the bureau of budgets and from the general fund for police and fire. They come from the npdr fund, so they don't touch. So it's a benefit to the general fund that you don't pay this additional cost for this service that we provide those members. We have disability and death benefits described in the plan. For npdr members. So active duty firefighters and police officers are not covered by Oregon workers compensation system. They are specifically excluded by state statute. They are covered by our disability plan, which mirrors a worker's compensation plan. We've had the plan that was created in 2007 or actually it was created a long time ago, but it was revamped in 2007. It's been audited twice nationally to making sure that it does comply as a worker's compensation plan. And it does. We have 18 people in our bureau, including myself. We have the disability group that handles all the worker's compensation claims. We have the finance group because we have a large budget, which we'll see in a minute, and a complicated budget. So they spend a lot of time doing that. They handle also all the pension benefits for the pdr one and two members. Then we have administration group that provides support for all of the people in the bureau and our members. Next slide please. So for next year we have a $255 million budget. It's funded via a dedicated property tax levy. So a few months ago, all of us that lived in the city of Portland and includes all of you, you noticed the line on your property taxes, says Portland fire police pension. That is the funding levy. So all that money I used to say comes to me and actually comes to our bureau and goes into our fund. It is a pay as you go structure. It means we are not allowed by charter to carry any fund monies, fund moneys over from year to year. We cannot accumulate. A fund that was created in 1948 is and there's a whole history as to why they created a pay as you go plan, but that's what we've maintained since then. Part of the reason we went to pers in 2007 was that's a pre funded plan, was to move that liability and that concern of paying into a non paying into a pay as you go fund. But we left the people that were already member active members or retirees in the npdr plan. So our revenue and I apologize. We left off some numbers off that revenue pie chart. The blue pie chart is our property taxes. So for next year we're predicting 232 million plus would be coming from property taxes. And that's 93.6% of our revenue. We have the yellow slab there, which accounts for $15 million and 6% of the fund. That is the amount of the fund that we have from last year. So if we do not use all the money this year, we have to take that money into next year's budget and buy down the budget, so to speak. So we tax less because we have money left over from the prior year, because we cannot carry it over, so that this year we're about 6% of the revenue comes from money that we had left over from our tax last year. And then we've got a small slice of a couple things in there that account for 0.3% of our revenue. So are those two of property taxes and beginning fund balance account for 99.7 of the revenue in. Obviously, you can see here there's no money drawn from the general fund for this. We're totally funded by our by the levy in there. The expenses that we have you can see here the npdr one and two pensions. There's the one that we pay out. It's 163 million at 64% of our expenses. The orange wedge there is the contributions that we pay. It's 58,000,023%. The ratio between those two wedges will be changing over time. Because we are hiring within ten years, we'll be 100% npdr three active members. So that wedge will obviously get bigger. And by about ten years from now, we should have all the two retired. So you should start seeing the fpr2 wedge beginning to shrink at that point. Then you'll see the wedge there for disability benefits. Again, this is our workers compensation benefits though it requires half our staff to administer, it only takes 3% of our budget. With it. We have administrative expenses. These are expenses that can't be allocated to any one of the other pies in here. So it's a general thing. And then we have fund management expenses. This is a combination of a contingency that we carry every year. It interest payments on our debt service. We have a minor debt service because our financial cycle begins July 1st like the city, but our income doesn't come in until November when property taxes come in. We oftentimes have to get a short duration loan to cover our cash flow for that time period. Usually, it's tax anticipation notes designed specifically for this. It's used throughout the country. This last year we borrowed it from the parks fund, got better rates from the parks bureau. So we did it. They are all paid back. So they're back up to where they should be, and we pay everybody back within a couple of months after we get all the tax revenue in. We have general fund overhead because we use a lot of services within the city. And since they aren't general, you know, they bill us for them. So that's what we call general fund overhead. Some of that money goes to you all and your services with that. Let's see what we all saw on the list here. So that's pretty much it. So that's somewhat the cost of doing operations in the city is what we have under that wedge there. I want to go to the third slide please okay. We are overseen by a board of trustees. This is not an advisory board. This is actually a policy setting board. They do have authority over us and their authority is granted to them by the city charter in chapter five. Their duties are to set policy for the fund, which is our money, and the plan, which is the benefits that we offer people. They prescribe the rules. All the administrative rules must go through them for approval. My bureau and I draft them and then they have to approve them all. They approve the budget, we go through them, and then that budget rolls into the city budget. They oversee the administration of the plan. They don't do the day to day and micromanaging of the plan, but they we do give them reports. They will ask us why and how things are done, make recommendations for how we should do things differently in the future, or what we should check in on, and they promote the long term viability to the plan. You go back to 2007, you'll see a lot of work if you research 2005 and six. There's a lot of concern that we have a cap on our property tax, on our levy. It was running up to at some point it was going to hit that cap. That would have been devastating because there wouldn't have been enough money to pay the benefits. So we would have had to honest with you, tap the general fund for that. So that's why the why the board of trustees, the city council, and there are two citizen committees guided and recommended that you move, create lpddr3 and move those people into pers. So therefore the levy is now significantly lower than it was about 2005, six and seven. So that was, you know, prompted heavily by the board. And so they still monitor we get an actuarial analysis every two years of the levy. And our spending to making sure that we our plan is working as efficient as we should. The people on the board of trustees is patrick hughes. He's the mayor's designee because the mayor's technically the chair, but they can designate the person, and that person is approved by the council. Patrick hughes, who you talked before, is our designee and board chair. We have kyle mccleary is a fire trustee and tommy stoffel is our police trustee. They are elected by their respective bureaus they work in. Then we have two citizen trustees, catherine mcleod. She owns her own actuarial firm. And she very in-depth knowledge on actuarial things, especially on pensions. We ask her a lot of information and she puts our auditors through their paces and actuaries through their paces, making sure they've investigated everything the way they're supposed to, which they always do. They're great firms. Then we have tom cramer. He's a retired attorney who specializes in a lot of pension work. Tom is retired, so he's got nothing better to do but read every single little piece of paper and every single word we give him. And so he will ask questions on page 25 of a document that we've handed to him. So it's great to have them both. Citizen trustees are nominated by the mayor and approved by city council. There we go.
137 Great. Thanks, sam. So if there's questions on if we can hold those to get through our next couple folks. The other kind of unique program within budget and finance is the small donor elections program. So, susan, I'll hand over to you to talk about that.
138 Good afternoon. I'm susan mattei, director of small donor elections. As all of you are aware, the program enables candidates to run for office through small contributions and matching funds alone. After each election cycle. We use quantitative and qualitative data to evaluate program performance, which informs a series of improvements made to the program, all of which are published in a public report. On this slide here, we have one example of that quantitative data. We total up how much money contributors in each zip code contribute to all campaigns. Then we divide that by the number of portlanders who live in each zip code, not the number of contributors, the number of people who gave people, whether they gave or not. Before the program was launched, the zip code that gave the most gave almost 900 times more per resident than the zip code that gave the least. That disparity reflects the inequities and narrowness of this type of participation in our elections. Once the program launched, that disparity shrunk tenfold to 89 to 1 for 2020 and 2022, and then another four fold to 21 to 1 for the 2024 election. This shows that democratic participation is broadening out across the city. The program's contribution limits move the top figure in the ratio down, while the programs matching funds lift the bottom figure up, and both are necessary in order to get results. Tracking this, along with many other metrics, helps us see whether the program is continuing to ensure that Portland has a strong and healthy democracy. Next slide please. The primary challenge the program is facing is funding. The program needs approximately 0.2% of the general fund to be solvent over the long term. It was receiving that shortly after the program passed in 2016. But as the general fund grew over time, the program budget kept getting little cuts here and there and then was dramatically underfunded for the 2024 election. Right now, if the Portland if the program were to receive the 0.2% of the general fund, it would be about $2 million. What's proposed for this upcoming budget is 1.3 million. If a similar amount is provided over the next three years, match caps would have to be cut by about 60 to 80% for the 2026 and 2028 elections, so that the program does not run out of matching funds mid election cycle. Next slide please. The Portland elections commission was enshrined in city charter in 2024. It requires them to make annual recommendations about how much funding the program needs to remain solvent. So city officials always have a politically impartial fiscal analysis. They also make recommendations to council and the program director on how to improve the program and keep it up to date with a constantly changing campaign finance climate. Thank you for your time.
139 Thanks, susan. And last but not least, familiar face, hopefully ruth levine, director of the city budget office.
140 Great. Good to see you all. Ruth levine, city budget office director. So. The city budget office is the city's centralized financial planning and budget analysis function. We support all bureaus, service areas, city funds, and then the mayor and you all at city council to put together a budget that is legally compliant, transparent, equitable and in support of city council's priorities. This slide provides a sort of high level overview of our work and our shows you a few of our performance measures. The majority of our staff support our budget and financial analysis. And then we also have two other small teams that I'll talk a little bit about, one that does performance management work. And then the Portland utility board. So I'll go into a bit more detail on the next slide. So budget and financial analysis has a few different kind of buckets of work. We manage the city wide budget processes and systems in concert with city council and the mayor, and ensure compliance with all state and local budget laws. We provide fiscal analysis to all legislative and administrative actions that have a fiscal impact. So budget ordinances as well as other other actions. We manage the city's general fund, including both technical sort of funds management as well as economic forecasting. And then we support funds management and forecasting citywide for all of the funds to ensure that the city's budget accurately represents all of the funds and that everyone sort of operates in compliance with, with with the budget as it's passed. And then lastly, we lead communications around the budget both internally and externally. And obviously we've been working with the central communications team and are going to be doing that more. I also want to note that so city budget office has sort of has been known, was created in 2012 as an independent bureau. And so one of the upshots of that, I just thought it was important to point out, is that we're very used to wearing multiple hats. We've supported bureaus during their budget development process. We've supported the mayor during the development of the proposed budget, and we've supported city council to pass amendments as well as legislation. And so in this new form of government, you know, we're adapting and looking forward to continuing to support you all and wearing multiple hats, something we enjoy doing. And then also, obviously, one of the big pieces of work we've been sort of evolving, that's been evolving over the last two years, has been changes to the budget process as we've entered this new form of government. And so that's, of course, something that we will be working with you all very closely on. And, and. You know, excited to continue to support and see what that what that looks like. Next slide please. So the performance team so the performance team as it's currently structured is a relatively new addition to the city budget office. But the city has been doing performance measurement in connection with the budget for decades now. And so what the performance team is very small. It's just a few people, but they do development and management of performance measures city wide. And then there's a position that helps support process improvement, both training and implementation. And then there's a person who manages the Portland insights survey, which we briefed you all on separately. So I won't go into detail here on that survey. And then because we're a small team, we also leverage these folks to do other work in our office around communications, community engagement and sort of data management, like, and then just not on the slide, but the Portland utility bureau, sorry, the Portland utility board, the pub is was created and placed in our office as a way to sort of keep it independent from the utilities. But they are an advisory body that oversees water and sewer. And then last slide. So here you can see a few links. And you know as I mentioned we're working to make to really improve our budget materials, make them more accessible clear easy to understand. And so we'd love to hear your feedback. I know we're also separately going to pull together a bunch of information on requests from the finance committee, which will provide separately, but this is at least a start. So, you know, happy to provide any additional information as you start to comb through these resources and see what we have available. Our budget books have are voluminous. They there's literally three volumes every year, but also they're just very long, which doesn't necessarily make them easy to parse. But we also have a dashboard that's on the bottom there that is that we've just recently developed to try to better visualize some of the data. And then we also have all of our prior budget analyzes that the bureau has produced. Oftentimes an issue comes up at council that has been an issue before, and we can go back and look at prior budget reviews to provide a little bit of context around that. So just wanted to point all of that out.
141 Great. Thanks. Thank you all for listening. And I think we've got an hour left to entertain. Any other questions?
142 Thank you all. And thank you for keeping the presentation tight so that we have that our councilor Smith, are you back in the queue?
143 Yes.
144 Go right ahead.
145 Thank you for that presentation. That was really informative. Going forward, will we have like a link to look at the latest updates of the bureaus as they change some of the requests they may have in their program offers?
146 Can I clarify, councilor? Do you mean in the kind of operational work that they're doing right?
147 Or will that just come a change in the package that the mayor brings forward.
148 In the budget? Yes. So in the upcoming document that the city administrator is preparing, that city budget office is managing, that will include detail on on every decision package. So every proposed change city wide, at least that's made it this far in the process. So that will include things from a specific staffing change to a change in funding specific to a program, small amount or large amount.
149 So if that document changes at all, that will be changed by the city manager, city manager or the mayor. It won't be from the different bureaus.
150 So maybe I could speak to program offers a little bit. So the program offers specifically are actually a combination of narrative and budget. And so every bureau in the city has program offers within it that describe what it is that the bureaus do. And you can see that in volume three of the adopted budget book. And there will also be coming out at the end of this month. Program offer narrative along with the documents that we're publishing, so that people can say, oh, I'm interested in, you know, what the city budget office's budget team does? Let me go look at that program, offer. The budget for those program offers is also in the budget system, and they're not program offers aren't like a legally binding thing. They're more of a communications tool. So bureaus can, you know, re budget once they when they bureaus can move money around within their budgets and they're not held to that specific program, offer level of detail. It's but it is a communications tool. And the intent is when we bring forward when we you know, when council passes the adopted budget that the that it communicates the funding within each of the program offers within each bureau. Does that help answer your question?
151 Yeah. And that's what I was talking about. So if any of those numbers change, that will come from the mayor will submit a separate budget. If his initial budget is if it's accepted as is, it will just be as is. But if he makes changes or if council wants to make changes, will those changes come from the mayor? It won't come from from the bureaus.
152 Yeah. Councilor. So. Right. So let me back up just for a quick second. So the process to date is that the bureaus have submitted kind of their concepts. Those are assembled, being assembled, vetted and assembled. So that is what will be proposed by the city administrator. It's not so much a budget in the way we would traditionally think of a budget. It will have decision packages and kind of narrative descriptions to sort of further the conversation about the city budget. There will be changes that that occur through discussions that happen in March and April, including work sessions at this body, ideas that come from city council that will get implemented into the mayor's proposal that could flow from multiple sources. Right. They could flow from this body specifically identifying we'd like to see this in there. It could flow from the mayor saying, I'd like to put this in there. It could flow from bureaus who are saying, we're also gathering information. And we would like to sort of suggest that that gets modified into the mayor's proposed, you know, maybe a community engagement effort identifies. Whoops, we put this thing in. Maybe we don't want to do that. So all of that change will be reflected in the mayor's proposal, which then evolves hopefully into something that the council adopts with whatever additional changes.
153 Through that evolution. Jonas. Who makes it? Does ruth make those changes? Who makes those changes? When the mayor changes something?
154 So in terms of reflecting what's in the mayor's proposed our team. Sort of coordinates the entry of that into the budget system, like technically, and then ensures that all the documentation reflects the decisions that have been made. It if you're talking about kind of major changes within, you know, kind of moving things around or. Yes.
155 Yes, exactly.
156 Then that would have to come forward in the mayor's proposed. And then council can make changes to that in the approved budget. Once you pass the approved budget, there are there state budget law kind of restricting the magnitude of the changes that can be made, but the it just sort of follows the budget process. So right now we're just putting forward an initial preliminary communication around recommendations. That again is not balanced. Then then the mayor will put forward the first balanced budget proposal in may, and then council will make amendments to that. And at every point in that process, our team is just ensuring that any decisions that get made are reflected in the budget, in terms of both the numbers that are in the system and then the narrative that is produced.
157 That's that's what I wanted to find out who's who's making those changes as we make those changes, whether it be through amendments or that even the mayor would want to change something that that's going to go through you. Yeah. Okay. Perfect. Thank you so much.
158 Councilor Dunphy.
159 Thank you, madam president. I have three and a half questions. First, I'm going to ask to ruth, specifically, my experience historically with budgets and budget cut proposal packages, and also specifically in what we've seen already for the proposals, is that a lot of times, bureaus will put up national monuments and say, you know, 8% for the parks, fine, we're going to close all the pools and then dare us to do it. And that's not really a helpful thing. Often budget advisory committees have been used at the bureau level. Are we still using backs in some capacity?
160 Yeah, I know you directed this at ruth, but she's pointed to me, so I'll take it. So backs are a little bit awkward this year. So in the past absolutely. There would be a back essentially for every bureau level. The future path is that there will be a what we would intend is that there would be a back at a service area level, and so that both has a different level of human capital management and maybe a little more refined discussion to feed that early process. This year, the timing was not great, right? A lot of us were in transition. The whole budget process is in transition shift to you all being here with us. So this year it was very awkward from a back perspective. And the guidance was given that it was essentially left up to bureaus to be optional. Step some bureaus had backs that were ver, maybe only a couple had backs that were very well formed and had staffing both, both human volunteers and people to manage the process. So we didn't want to say, don't do that. Many bureaus didn't know that they needed to get volunteers, and they didn't have people to manage that through the process. So and we didn't quite know what it was going to look like in this new form. So this year, very suboptimal future path will be will be much better from a back perspective. To your question on kind of the Washington monument, yeah, the system is hard to avoid some of some of that under this new alignment. I think mostly we've avoided that because it's been built collaboratively. So at the kind of executive leadership level with multiple dca's in the room and multiple other perspectives in the room, it gives us an opportunity to hold each other accountable, that if one service area is submitting something, we can say, hang on, that's doa. Let's let's have a different conversation. And so that temptation still exists. I won't be surprised if some of those things still sort of filter through this year until we get a little more experience in having the conversation. But the new alignment, I think, has been very effective in preventing that from being the norm.
161 Great. Thank you. Sam, I have a couple questions for you about pd, p, s and dnr fp. Fp are there we go. First of all, I have always found this structure to be odd. Is this a national best practice for how we deal with federal with with our with our police and fire retirement systems? Just the general structure of it being bond funded and. Pay as you go.
162 The pay as you go. No, it's an old system that extremely expensive. That's why in 2007, they got moved all new hires into a proper system. It was just something on there's history that goes back over 100 years as to why this was developed. Basically, they could never get a funding plan to work, and they tried it six different times and it failed. So they just gave up and went this way and they've left it in contact. It was looked at heavily. In 2007. It was felt that it was too expensive to try to go back in and pre-fund the fpr one and two. And roughly speaking, how many people are on the dnr one and two at this point?
163 Active? It's probably 7 to 800. It's we're about 5050 right now, 50% that. So it's basically half of what's in both the bureaus.
164 Great.
165 Thank you. Okay. And I will say in about ten years it will almost be 100% fpr three.
166 Councilor Zimmerman.
167 Thanks. I just want to clarify. So for those who are after 2007 on this, that they're just in the regular fire and police pers that we talk about in other agencies, am I correct? Okay. Which is purs but slightly different.
168 Well, it is pers I mean it is pers and they are most of them are in ops.
169 It's different than what jonas is on. That's my point that I'm trying to make here. It's but it's, it's when I'm at Multnomah county and I'm talking about my, my police pers it there in that system. Now, instead of being in their own.
170 A little bit, they're all in the same system. They have different line items that define what people, what police and fire get and what non police and fire get. But it's the exact same system, the same statutes. They just have different provisions within those statutes like.
171 The length of service.
172 Length of service. Yes.
173 Police and fire okay. Thanks for clarifying that. And then susan, in terms of small donor, I think my question here is just given the change with the election commission. And one of my questions really is about how do we. Work to clarify where there are some confusing aspects we've got, we've got our elections commission, but then we have our elections officer within the auditor's office, and I've found it to be a an acknowledgment that both exists, but also kind of an unwillingness to really talk about either side's program and how they interact. Do you think with this new 2024, do you think there's room for that to be more clear for, for everybody in Portland, or what steps do you think that would be helpful in terms of envisioning what this new commission's role is going to be?
174 Well, I think probably the first step would be to have discussions to figure out what the desirable role is. And I don't know that actually, the Portland elections commission being enshrined in charter, it was a necessary step to clarify that role, I think there's inherent sort of tension about having different parts of campaign finance and elections handled at different levels. You be it, you know, campaigns, as you are all aware, have to follow federal, state and then two different types of city law. And so it's inherently challenging and it's best if everyone is aligned. And so, you know, I think the first thing to do is to have, you know, discussions about the best ways to align things. And then, you know, what's necessary that drives what's necessary to move that forward.
175 Great. Yeah, I think I'm just thinking through and it's probably an area where our, our finance committee will probably do an invitation to your program as well. In terms of things we can help clarify to, to make the program you know, that much better. I mean, you, you present some just some compelling statistics about how people engage in the process. Now that I think are thank you for putting that slide in there, by the way. I appreciate that and good luck with the future hire. I know that you're you're working as a lone ranger right now with respect to this is going to ruth. Ruth in the performance team. I am some of it makes a lot of sense to me, and some of it I am unclear, maybe because I just haven't had experience with it. Or maybe it's because I'm coming from Multnomah county's version of how they work with their auditor about performance evaluations of programs. And so I am used to hearing from the auditor that the county about here was the goal of the operational program. They did or didn't meet the mark with respect to the impact they had on that goal, and that would be the performance evaluation. Sometimes that happens internally to a department or to a bureau. Is that what your performance team is tackling, and is that a duplication of what our auditor in the city is trying to do?
176 Yeah. Great question. So. Our performance team by and large is setting up citywide processes for performance management. So as an example, right now they're working to actually transition our budget performance measures onto a new platform called scorecard so that we can have one clear place for a sort of slimmed down suite of performance measures that show kind of what all of the not just the programs within our bureaus, but what we as a city are doing. And what are the things that we look at? What are the points of data that we look at to say, how are we doing those? So it's a much more kind of 30,000 foot level view of what we're doing. Most cities have something like this. You can go to like performance seattle as an example, as like an analog boston has a program for this as well. So that's kind of the level at which we're working. We don't do any at this point. Specific program evaluations, although I would also say that as a person with a background in program evaluation, that what the auditor does is also somewhat distinct from a true like, in-depth program evaluation, where you're saying there's a policy question that we want to figure out and we're trying to answer. You know, if we go with option a or option b, are we more likely to get what we want that you might set up like a robust program evaluation for? So I think there is still room for that. But it is. We're just not staffed for it right now and don't have the resources for it. So I think so for sure, kind of the existing work of the performance team truly, it's like one and a half people's worth of work. It's not a big team. On the performance management side. It's really around getting those performance measures kind of set up and then managed and communicated in a way that is useful and informative, both for decision makers and for members of the public.
177 And councilor, if I may also just add, I know we've had discussions a little bit today and in finance committee last week about kind of the long term vision of the budget, which is it's an annual kind of year round discussion, not a point in time discussion. And those kind of performance metrics that are managed are really important step in that process so that we can implement the budget and then come back and say, how did we do? And that that becomes part of the discussion in thinking about that next, next cycle.
178 Thanks. And ruth, I appreciate the way you, you you framed some of that up. I think it can be one of the difficulties when we've got an auditor's role, but also any leader worth their whatever the saying would be, should be, should be monitoring performance. And there is a team that helps you do performance evaluation. And I kind of think of those as complementary but distinct from one another. And so I can I can envision a city a couple of years from now where we've got fairly robust performance management in each of the service areas, and then the auditor in their own elected role for that transparency and the deep, deep dives on certain areas being a different type. But they're not one in the same, but they are certainly complementary. I appreciate that. And then lastly, I have been to a gfoa conference, which I'm sure you're just thrilled to know, and I certainly was thrilled to be there. It's definitely not the most barn burning conference, but I really hope that you will invite councilor Green to one of those. I think he will dive into it and be a great, great person on behalf of this council to send to gfoa conference.
179 So appreciate that feedback. And you're speaking to folks who love going to conferences. And you.
180 Guys drink some very stiff water there. Yeah. Okay.
181 And councilor, it's may or June in d.c. This this year.
182 There you go. And then I just wanted to just in terms of jonas's answer to one of my colleagues about the Washington monument side of things, I appreciated the question and the answer. I think that when I'm looking at who is from a from a staff leadership perspective, who is stepping into the role of truly serving in a way that represents the city, people will be successful, in my eyes, who are not playing bureau turf wars, insofar as if you are willing to put up a Washington monument, you are telling me that you're probably not a city leader. You are a certain sector's leader, and that's probably not what we're looking for at the highest levels of this organization. And so I, I appreciate that that question got asked because it's a past practice that I really hope expired on the 31st of December, because I don't see a future for those types of shenanigans moving forward. So thanks for answering it so clearly. That's it for me.
183 Councilor Novick.
184 Thank you, madam president. My question is, again for director hutchinson. I think I was confused. I thought that the dedicated property tax just applied to the pre 2007 people. So I thought that bluntly, as those people started to die off, the tax could go down. But if it also funds the ongoing pers contributions, does that mean that we're going to have to keep on collecting over $200 million in taxes, you know, which is a big chunk of people's property tax bills at for ad infinitum.
185 It the fund you saw the one cycle. It had all the different expenses. That's what the fund covers the taxes. So it covers at pdr one and two covers the purge, three pension contributions, disability benefits. And our overhead is that's what that whole tax covers. What will happen. We just had our actuarial evaluation for looking at this. Given that in 2000, let's say ten years from now we are going to be let's just say all the pdr one two are going to retire. So the cost of that plan will start dropping. It'll be slow, but it will go on down. Pers contribution. That wedge will continue to grow until ten years from now. When you have 100% employees, it will stay the same. Maybe go up depending upon how you hire. So that will be level. So overall what you're seeing on the actuarial chart, it's on our website here. It's a downward trend, significantly downward trend over the next 20 to 30 years. Because the biggest pie here is going to start dwindling. And the pers contributions will not grow in number wise. What you're what is declining in that piece of the pie okay.
186 That's encouraging. Now maybe this makes no sense now with interest rates so high. But if it were allowed by the charter, is it possible that we could like, do a bond over the next 30 years and spread the cost out over 30 years and give people now some tax relief?
187 It would tax relief okay. What would happen. Let me jump in and ask a question. Are you assuming that we're pre-funding ipdr one and two? Is that what the.
188 I confess, I don't really know what pre-funding means, but yes, I think.
189 If you want to get to the point to fpr one and two. So you're working pre-funding and having money to invest and cutting down. If I were to 100% pre-fund that plan tomorrow, we would have to come up with $3.2 billion. That's your problem that you have with it. Now, there's been a proposal by some people, let's do that over 20 years. So we get all that upfront spread instead of one year over 20 years. And then after that 20 years, you will see the taxes drop dramatically. But during that 20 years your taxes will go up. You tax, you pay more in taxes today, so you pay less in taxes into the future. And I'll tell you, in 20 years is when you start seeing that I'm 68, I will statistically be dead before I see the end of that 20 years. So for that time period, I, as a senior citizen in the city of Portland, will be paying higher taxes with no additional benefit for those taxes. I'd rather pay for parks than I would to try to pre-fund this program. I'll suffer it out. I understand the logic. I think it's been presented to you in different ways, but that's what happens when you pre-fund you got to pre-fund it. No matter how you put it out. It's got to be paid by taxes. You can try to float a bond, but the bond has to be repaid with taxes. It's hard. And that's why in 2007 they decided not to do it. It's trying to get all that fund to because most of the people that are on fp two and one are retired, so they're not contributing. The employer is not contributing, they're not contributing. So the taxpayers have to contribute for their future funds. So it there's logic to it, but it's a 60 year run out to get the full benefit of that kind of concept.
190 And councilor I would add to, you know, pension borrowing is a speculative activity. So there are circumstances, including some the city of Portland has taken in the past where it's worked out very favorably, in my opinion, largely due to lucky market timing. And there's been circumstances elsewhere in the state and elsewhere in the country where it's worked out very much, not favorably due to poor market timing. And so I would just flag not only are there some other sort of debt capacity challenges around borrowings of that size, but but as a tool, it's not consistent with the best practice.
191 Okay. But it sounds like we can tell people that ten years from now or thereabouts, the property tax will start going down. Yes. Okay.
192 And again if anybody wants to we have the actuarial analysis which shows the charts for that pretty easily for that. So if anybody wants it let me know and I can give you a link to it.
193 Thank you.
194 Councilor Green.
195 Thank you, madam president. I'm on everyone's favorite subject, which is also okay. I just want to continue on this because I think this is a really worthwhile conversation, partly because right now the city is like, how did we get ourselves into such a financial state? Like who who made these decisions? And now now we've all got to deal with it. What I don't want to happen is ten years from now, 12 years from now, 20 years from now, people look back and say, what the hell were these guys doing? And so I'm going to ask this question and maybe pose, pose a way to thinking to, to council is that, you know, by the actuarial charts that I, that I read in 2024 was $133 million for the series one and two obligation that comes out of our property tax revenue. Now that that line does is projected to peak at 2036, but it doesn't get back to today's dollars until like 2053. So it's so it's not really correct to say in ten years your property taxes will go down. It's more correct to say after ten years it will stop increasing as a share of your property tax bill. And so and I and I say this because I do want us to think creatively about it and not write it off, because I think there's more than one way to skin this. Like, we don't have to go out and float a bond to raise $3 billion to pre-fund it all away. I think we could think about asking the question of, do we think it's fair that this burden falls only on property taxpayers, or is there a way to conceive of a new revenue structure, which we probably already need to do anyway, because our general fund is really sensitive to property tax revenue and compression risk. And so if we were to think so, I guess what I'm saying is I would welcome a study. It's not 2007 anymore. I'm happy to support that. But let's take another look at what the art of the possible is with this. Because if, if, if we could, over a 25 year span save, you know, $8 billion in net present value terms to taxpayers, I think we have an obligation to think that through. And I'm happy to kind of use some of my resources to help on.
196 Just quickly remember to find in the charter. So we require a charter amendment, specifically how you're going to change the funding program and what you're going to do with the taxes. So that'll have to be in there. So the citizens will have their input on any final say that you want.
197 And I'm happy to talk about it on the finance committee in our off budget cycle season. Thanks.
198 Councilor Kanal.
199 My question is also are going to start with fp and r, and I do have one each for you, susan and for ruth as well. So the question and I agree completely with councilor Green and his most recent point, and the thing that I think is being missed here, there's two things. One is the possibility of investment related earnings, deferring the overall cost of the program over the next 70 years or whatever, 50 years at least, because a person who retired in 2007 could ostensibly be living for quite a while. Right. And we hope they do. But maybe not actuarially, but but morally so, you know, as we get to the conversation around that, I think just understanding what is the amount of savings that would occur is a really important thing to ask. And so I am going to ask it if we can get that kind of information hypothetically, before we even start the conversation about, I think, saying that we would need a charter amendment to do something is fair, but we should have the information to understand if that's even worthwhile to have that conversation.
200 No.
201 Yeah.
202 Just to remember, in order to get enough fund to invest, you have to come up with the cash upfront. Yes. That's what everybody is proposing right now. Your big decision is how do you get that cash upfront so you can invest it. And I will tell you I everybody I look at it, it's going to come back to the taxpayer having to put more cash in today so they get more back. But you you talked about seven year run out. So somebody who like me today is in their 60s I will see zero benefit. So you're going to really have to talk to the public and convince it. You're going to have to have people that are going to be young enough who are going to own a house and live the city of Portland for 70 years before they get the full payback of this kind of plan. So that's the battle that you're going to have, is how do you benefit the taxpayer today versus the taxpayer tomorrow and the taxpayer in 30 to 40 years?
203 I guess what I'm saying is that, respectfully, I have political advisors, and I'm looking for budgetary support right now on this and the facts and figures related to that, because I'm 38 and I pay rent, and that goes into the conversation. Obviously property taxes are passed on as well. So I respect that we're going to need to have those communications with the public. But the thing that that you have that obviously you can provide us all sorts of advice, but the specific thing that really only you can provide is the facts and figures around how much it would cost and how much it would save. And I think a few scenarios on that would be incredibly helpful for us.
204 We can talk some more because it's more complex than that. We have to come up with what kind of plan, because each plan has radically different costs and savings. And what do you want to do with it? I just I do think it's going to cost you more today to save you money in the long run. And yes, you will save money in the long run. But then again, you talk about age. Who's going to benefit for that savings.
205 Exactly. And I think the intergenerational equity components of this are really important because of the fact that we are currently paying for services, that we are not getting, that the last generation passed on to us. So how do we make sure that we're not passing those on to the next folks is, I think, the question that we ultimately need to be asking ourselves around npdr. Yeah, my question to small for small donor elections is your projection about $2 million into the future, and the percentages that would be cut is, I'm guessing, based on some sort of modeled out estimate of how many candidates there are that would qualify. Would you be able to share that information at another time with us as to why how you got to that number?
206 Yes, the Portland elections commission will be informing council of their funding recommendations for the program, and they will show you their math. Great.
207 Thank you. And then for director levine, if you could just speak to because we don't have any budget analysts in our council operations team at this moment. And I asked this question of a few other folks as they've come through, like the city attorney's, who do you view as the recipient of cbo advice? Does the cbo advise the administrator, the mayor, council, all the above? How do you how do you view that?
208 Good question. I mean, I think all of the above, as I said earlier, we are very used to wearing multiple hats. We've this is not a new concept because even though we didn't have separate legislative and executive, we had separate phases of the budget. And so yeah, I mean, I think we certainly are advising you, I'm happy to continue conversations about how to do that differently now that we're in the new form of government and certainly the paths of legislation and the like are changing. So we're we're actively talking about how to how to support that differently. But but yeah, we are here to support you. If you have any budget or finance related questions.
209 Thank you very much. Thank you all.
210 Councilor clerk.
211 Thank you, madam president. This is not a question about fire and police disability retirement. I, I think all of us here that are the sort of government finance walks are really enjoying this. This has been great. Appreciate everything that you shared. But I just want to go back to that simple question I asked earlier about the tsk. I guess because I had to go to the tsk when I worked on the payroll tax and get approval, and I just wondered, you know, what's our relationship to it?
212 I can.
213 Take it. Or do we have one?
214 Yes we do. So the Multnomah county tax affairs and conservation commission, we work, we they cover us. The city of Portland as an entity, and we work with them. Our office works with them on all of our budget process related questions. Their staff are great. They're really good resource for any questions about how to remain compliant with Oregon budget law. And the probably your experience is that anytime there is a tax being referred to the voters, that does have to go in front of the tsk for a specific hearing before there's a there's a deadline that I'm forgetting off the top of my head, but there's a certain number of days before it can actually be referred that you have to have a specific tsk hearing. So just something to keep in mind if anyone's in terms of the timeline for new taxes.
215 And ruth, do you want to just talk quickly about the role because there will be a tsk hearing specific to the budget adoption, because that is a tax implementation.
216 Yeah. So in just before the adopted budget. So it's between the approved and the adopted. So I think it's scheduled for June 10th tentatively tentatively for this year. The tsk which is made up of residents of the jurisdictions conducts a hearing with each of their jurisdictions with. So they will come and conduct a hearing with you all. And it's a bit of a funny thing, because it's kind of a role reversal. Sometimes they actually sit in your seats, but you don't have to do that. And where they ask you questions. And we'll talk more before June about how we're going to conduct that and how our our office, you know, is heavily involved in supporting for that or has been historically. So we can talk more about that. But they ask a lot of questions. The actual commissioners are the ones asking the questions in that hearing. And then in addition, the staff of the review, our appropriations schedule, to kind of make sure that it's that it's compliant. And that's part of the reason that there's a window of time required between the approved budget and the adopted budget, and then you can't make major changes between the approved and the adopted, because that's the window during which the tsk conducts their review. So it's basically from like may 20th 2nd to June 10th. Is there like review window. And so they're doing both the kind of staff work of reviewing the appropriations schedule. And the commissioners are developing their questions.
217 So if we make amendments throughout the year, we don't have to go back, do we? Or do we.
218 Know we only have a tcc hearing once for each adopted budget? Obviously, for supplemental budgets, for major supplementals, there are requirements around in state budget law around what has to come to council, but you don't have a tsk hearing for those.
219 Okay. Thank you. And I, I, I have other questions, but I'll follow up individually with you. Thank you. Thank you so much.
220 Councilor. We do have time if you have additional questions. Okay. Director levine, I feel like we haven't had enough questions about the budget process yet. I'm wondering about program offers and proposals that bureaus submit that are a part of the consideration that the city administrator goes through, that are part of the consideration that the mayor goes through, that we might want to see, even if they are not included in that proposal or that budget. Is that something that you historically get to all of council? Do we see all of the program offers, even the ones that have not been included in the city administrator's proposal and the mayor's proposed budget, or do we only see the program offers that they bring forward to us?
221 Yeah. So quick point of clarification on on semantics. And I know different governments use these terms differently. So, so we have the term decision package, which is the change in the budget that's being proposed. So you have your base budget, which is what was ongoing last year. And then you have decision packages that, you know, add funding or reduce funding. The program offers are just a way to essentially code code our work in a way that's supposed to say, and they can actually cross bureaus, but like, what type of work are you doing? So is it the.
222 Decision packages then?
223 Sorry, that's the program offers are just a communications tool to say what type of work we're doing. The decision packages are the actual decision points for you all. Where where you know, first the mayor will say thumbs up, thumbs down. Don't want to include this one? Yes. Want to include this one. And then you all will have that list of decision packages and whatever else you want to reflect in the budget. And we will be publishing all of the decision packages that have been submitted at the end of February. So you and the public will be able to see everything that was submitted, whether or not it was recommended in the city administrator's recommendations.
224 Great. Thank you. And it looks like councilor Canal is back in the queue.
225 Thank you. You said the program offers just a second ago can cross bureaus. Can we expect to see, for example, behavioral health which is covered under parks rangers PPB Portland street response. Is that something we could expect this year or is that something that simply can happen?
226 It's something that can happen. There are some I don't want to, like, get too far over my skis here. But the like things like legislative and administrative things are like it's the it's sort of a type of work that, you know, happens in lots of different places. I will say our program offers really need some kind of revamping. We've had they were introduced. I'm going to forget, I think under mayor wheeler, I forget what year. But they I think we need to do a better job of using them to be consistent in communicating in a way that's helpful about what the work is that's actually happening. But it's right now it's there's infrastructure there in our system to do it. We just need to it's there are hundreds of them. And so it's a lot of work to kind of align them. And there's actual money in those buckets. So bureaus would have to move it around. And in any case it's totally doable. I will not claim to you right now, today, that they are organized in a way that's going to be super, super helpful to you. But I do think there's really good information in there. If you go look in volume three and the program offer book in the adopted book, I think there is good information. I think it could be better. But yeah.
227 And relatedly, sort of relatedly, the decision package side, you said that that's for changes. There are often and this relates to something councilor Dunphy and councilor Zimmerman talked about often. The only time we really learn about the level of detail about the things that would not change are when they are put up as national monuments, which is a phrase I love using. Thank you both for that. But how do we where would it be published? The level of detail on the parts that would not change?
228 Yeah.
229 Because those might be things that that we would like to either increase or decrease.
230 Absolutely. I think it's a good question. We have historically done that in our cbo reviews. It's what we call them, sort of base budget reviews. If you've ever heard people say zero based budgeting, right, it's kind of like, look at the whole enchilada and not just the marginal change. And so, you know, our cbo reviews were a place where we did that historically, where we kind of did the whole thing. I think we just need to continue having conversation about that. I think the it's really challenging to do it in a way that is accessible and not, you know, hundreds and hundreds of pages, which is what we used to produce. And so I think we will need to evolve some structure where we understand from you all, either through committees or whatever, you know, what are the what are the types of things that you want to understand better. And we can kind of take bites of them. And I've seen different at gfoa conferences. You may have heard speeches on this, but like, you know, some some places will take, you know, a deep dive on one area or like one service area per year where like, it's your turn to do a deep based budget review or whatever, or council can identify what are the areas they want to see. So I think it's just something we'll need to evolve going into future years of like, what are the questions you want answered? Because in a budget of the size of the city, there's no like I can't produce a pithy ten page report that's going to tell you what happens in every corner of the city and what might you want to see. So I think we just will need to evolve that. I will say we're there are some analyzes that we are going to highlight in the city administrator's document that are in progress. And that, I think, is an area where we can continue to work with you all over the coming weeks to understand better. Like, what are the questions and what is the analysis you want to see, and what is the format in which you want to receive that?
231 And can I just add to I mean, this maybe feels like a little bit of a good news, bad news kind of sandwich, but some maybe bad news is that this is not going to feel super satisfactory because we're in this moment of kind of completely evolving the way that we do all of this really soup to nuts within the construct of state budget law. The good news is we have all opportunity to evolve this and so get feedback and learn from this process so that the things that aren't what we want them to be collectively, we have an opportunity to continue to refine those going forward. It's going to take multiple cycles to kind of get it right. Also good news is that we are here and willing and able and maybe even begging to communicate with you and find those forums to do that so that you can have that information. Committees are a great place to do that. The bad news on the other end of that sandwich is we do have limited human capacity. So just give us some grace, if you can, that we are aiming to do all of that. And often it's just it's just very, very difficult to dig down into that level of detail with, with all the other things that are going on simultaneously at the same time at the city. So, but, but really, really looking forward to the opportunity to elevate that discussion with you.
232 Thank you. And the thing that I forgot earlier and I don't know who I, who might want to answer this, but I wanted to ask about the integration, if any. This is on a completely different subject between the racial equity program that you brought up in the title slide and the investment side of the house. We talked about sectoral or industry based limitations on investment, types of things that can be invested in. But we hadn't yet talked about that side of it, and I wanted to understand better to the degree to which those two parts of your shop are working together.
233 So on the investment you're talking about, like portfolio investment. Yes. So yeah, honestly, probably not that well integrated at this moment. I would say that's an area where we probably have some more work to do. You know, a large part of our portfolio investment because the limitations in policy are so limited. There's not a lot of opportunities to sort of choose different investments. That doesn't mean we can't always look at other, other lenses when we're doing that as well.
234 So thank you. And I have a lot of faith in your racial equity program leadership. And I want to do what I can to support that integration.
235 Thanks. Thank you.
236 Councilor Zimmerman.
237 Thanks. If you've talked to your colleague at the county, she knows and she'll tell you, I love the budget book day when I get those stacks. I am one of the few who still wants it printed and on the desk, so I'm looking forward to it. I'm not going to go through a thousand pages online, so I'm a highlighter guy, so looking forward to that. I am inviting, I think, as an extension of your conversation, inviting the rest of council is that I agree with jonas, is that we are in a mindset of how to get through this year in a midst of change. But also, I would like to work as the finance committee and with the other members of the finance committee to hear your things. You definitely want to see in the budget process so that we can work as hard as we can to integrate that. Right? So if you have those, we are we are all ears and we will the five of us will work with them to package the best recommendations back to this body as we can in terms of what's workable and coming at the next finance committee we will be looking at, and I hope, referring to the rest of council, a document that we will normally take up a lot earlier in the schedule. But for this, this body to adopt its budget schedule, its community engagement schedule, that gives you all the dates of tsk, that gives you an idea for when to see an executive budget versus the other packages. Et cetera. Et cetera. And so that will be coming in short order, so that you are all able to block out and also see where the touch points are throughout the rest of the season. That I think is some of it is kind of standard operating procedure. But nothing about this new form is standard operating procedure. And so we're all figuring it out. I have never been a part of a budget where the budget officer was not sitting at the dais, right. The mayor or the or the chair. And so that's different where the city manager. So it's an invitation, I guess, is really what I want to just lay out there. There is 12 different versions of what we all need to make decisions. And I'm inviting so that the five of us on the finance committee can do our best to incorporate those. So thanks.
238 Councilor I, I have bad news. As somebody else who likes the budget book and reading through it in paper, I have been told that we don't produce a paper copy at the city. Is that correct?
239 Thanks. You. We can, we can we? We have not for several years. Several years.
240 But you've noticed I don't do well with prohibition.
241 We do have printers.
242 Yes.
243 Printed.
244 I hope that you are hearing that there may be some councilors who would like paper copies of our budget.
245 We'll start printing now.
246 Thank you. Councilor Green.
247 Thank you. Just to just out of curiosity, is there a market right now for bullet bonds? Bullet bond.
248 I'll say there's a market for anything. The cost. The cost for it is the is the delta. I assume by bullet points, you just mean a single rather than serial bonds. Just a single maturity.
249 Yeah. I'm talking about, you know, interest only until final bond principles do.
250 Yeah. I mean, there is a the city is a triple a rated city could find a buyer for a structure like that. There's trade offs. Right. And so that's the thing that we'd have to consider. It's that would be outside of our debt policy. That doesn't mean it's an impossibility. It just means there's some other conversations that have to occur before making that decision. And I know matt behind me is probably stressing out and sweating just hearing the question. So we'll let him stay there.
251 Thank you.
252 Councilor Novick.
253 I, I just have to take up the Washington monument issue and say that I think that our situation is bad enough that I expect to sacrifice the Washington monument and the vietnam memorial and the jefferson memorial. I'll be happy if we can just hold on to the lincoln.
254 Councilor. I'd laugh if we weren't that close to that point in the budget. Councilor Smith.
255 Thank you.
256 For that. And I do have to agree with the president and with councilor Zimmermann. I do love a book because I can look through it if everything like under the six. These are the, the, the actual departments and bureaus and put their line items with those program offers. Because then I can look at that. If you have it in a spreadsheet or you're looking at it online, it might just say shelter services. Right. But what the what the program offer does, it gives you all the detail that you need to know. Oh, this is this shelter service, this shelter service or that shelter service or this infrastructure or this public works. So you know clearly what it is, and you can snatch them out. Put them in. Nope. Yep yep yep. I mean, it is much easier to read after someone who has done this about eight years and looking at these and then afterwards and looking into those books, it is so much easier to read and understand. And then when you put them up on the on the link and you can go in electronically and you can move them around, it's, it's, it is something special. So I don't. I just I'm so nervous right now to see the budget process and how we're going to get the information right now it is going to be foreign. But I guess we're going to all learn at the same time. So I just wanted to let you know, please keep some paper around. I'm old school.
257 Councilor Morillo.
258 I just wanted to.
259 Let all of my fellow councilors know that I will teach you what control f is so that you can use the online budget, and it'll be really helpful and useful. Thank you guys for this presentation. I.
260 Know, director berrier dc area, I'm hearing that you may need to add a line item to your budget request for reinstating paper copies. Yeah. Director levine, you mentioned that the base budget reviews aren't happening this year. It sounds like, but that we can figure out what we need in future years. So for this year, what can we all expect in terms of specific details about things within the budget that we might not be getting in the decision packages from bureaus? You've got ten folks who are new to this council, one who is coming back but hasn't seen the budget for a little while. And I know many of us have experience with different parts of the city budget, but we don't have the level of depth that the my colleague to my right may have. What can we expect from you to make sure we have the information we need to actually dig into the budget?
261 Yeah, I'll take a pass and then have jonas answer as well. I mean, I think it's not that there was no base budget analysis done. It just wasn't done in in the same way that we used to do it. Cbo used to provide reviews in March of each year in which our office actually did the thumbs up, thumbs down exercise for all of the decision package, and we would publish that along with the base budget reviews. And we're no longer doing that in this form of government. The document that's coming out at the end of the month, there is, you know, we tried to keep it short enough that somebody might actually read it, but there is analysis in there of kind of what all what kind of what was recommended, what wasn't recommended. And then what are some things that what are some additional areas of analysis we're looking at. But there is certainly not kind of like, you know, I'm thinking about examples of reviews we've written in the past about kind of like boec budget and the response times and how their budget has changed over time, and how their response times have changed over time and things like that. That is not being produced this year. So I think the question then is over the next, you know, whatever it is, 12 weeks, how would you all like to get information on what is in the base budgets? I mean, there's, there's we can get you all kinds of information. There's more information on any of the decision packages, right. Or more conversation that can be had about what types of trade offs are would occur if you did one or the other. And then and then there's also conversation around what's not in those decision packages, some of which will be teed up in the document but not fully fleshed out. And then there may be questions that we haven't teed up yet at all that you all have. And maybe, you know, hopefully those will be that reading the document kind of sparks ideas in your mind, of other things you would like to see and questions you would like to ask. And then we need to have a prioritization conversation of how to spend our collective time and effort to answer those questions best for you. So I don't know the answer to how you want to achieve that. You know, the I'm sure the finance committee will be a part of that, but I just don't know. I think it's something we'll need to come up with an answer for in the in the next few weeks here on okay. You've now you've read this document, you've seen what's in it. What what else do you want to know about and how how should we go about doing that.
262 Yeah. Agree with all of that. It's going to evolve. And this is we'll practice and see what works best. And we'll try stuff and it may work and it may not. Finance committee is an opportunity. Other committees, if there's topic specific budget items is a is an opportunity. The we'll have a work session or more than one work session. So that's some opportunity. The 2425 budget documents have at least last year's program offers. They won't be perfectly aligned to this year, but at least as a resource that exists. To give you some context, we're happy to do any other type of forum, a district briefing, or multiple districts or other kind of groups. It can be as light, a touch, or as heavy a lift as you wish. And just those both have trade offs, right? Light touch a little less information. Heavy lift is a heavy lift. But but we're willing to accommodate that. What is super valuable. And I think this is a exciting outcome of this new alignment and conversation today, is it has to be an active conversation that we have to be able to sort of gather this information together so that the budget that gets put forward in may and the budget that is adopted in June is reflective of all possible priorities. And that's not going to be able to happen if we can't make time to have time and space to have those conversations. So, as we said, we've got a pretty limited window to figure out how that's going to work. I can, as you guys all well know, getting on calendars among any of us up here is really challenging, and so we'll need to really start scheduling that asap to get those conversations going on, but look forward to having those conversations.
263 Can I add one last thing, which is that I feel like I didn't give my staff and the city budget office a sufficient shout out because they are super talented budget analysts, and they are the ones who actually do all of the hard work on answering these questions. Even things that seem like simple questions are often not in budget land. And so. But I'm also offering that we will I will work with them to, you know, prioritize and get answers to you on the questions you have over the coming weeks about about the budget.
264 Thank you, councilor Smith, is your question quick?
265 Yeah. It's quick.
266 It's almost like, why would you reduce it from what it was last year? Why would we dramatically change how the budget is presented? Are we still going to have fiscal year 2324? Would we, if this is an old program that we paid for it, you know, will we have a line item that said, if we pay for it for the last two years and what the over under is on the on the third? Yeah.
267 Block in the proposed.
268 In and at the end of so we will have program offer data and narrative coming out at the end of February. So you will still have all of the program offers citywide. So that is still there. Maybe I didn't make that clear. Sorry. So you will still have all of that. The part you won't get as much of you still get some of it is the kind of extra analysis that cbo does on all of those things. So kind of detailed questions that that we would try to answer in that are cbo reviews, but you still get all of the program offer narrative and data. You will still see, you know, how the funding has changed and the staffing and all of that kind of stuff in the program.
269 If it increased or decreased ftes and all of that. Okay. Thank you.
270 Councilor Ryan. We have one minute.
271 I hope that councilor Zimmerman and madam president, that we have some sort of work session sooner than later that allows us to figure out what kind of process we want, because unless you're in your committee, I think all of the committees are going to be in budget season. It doesn't matter what committee you're in. So we haven't had a chance ourselves to talk about what that process is going to be like. So I was just listening more as fyi today and but now that we're talking about the budget process. Thank you, councilor Smith. I do think that it's kind of clear as mud to a certain degree at the moment. Yeah. And that's not your fault. We're building something.
272 I believe that the finance committee will be bringing something to council as a proposal. Is that correct?
273 Yes. And I hope there's work area discussions so that each committee can be actively engaged. Thank you for the thumbs up. All right. That was quick right.
274 Thank you all. And thank you to the other folks within the service area who answered our questions previously. We appreciate the conversation today and appreciate all the work of your team. With that, I will close our work session and counselors. I will see you all up here tomorrow evening.
275 For.