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City faces torrent of ideas on how to divvy up the surplus cash

As Portland’s economy continues humming and city coffers overflow, city officials face a welcome dilemma: how to spend $30 million in surplus cash projected for next year.

Prudence might call for fixing some of the city’s long-neglected roads and parks, or perhaps making a down payment on the $100 million-plus it’s going to take to repair the Portland Building, the city staff’s primary office quarters.

But the word is out that the city has extra cash, and there’s a torrent of special requests to carve out some of the new money available in the budget cycle that begins in July.

“It sometimes doesn’t make decision-making easier; it sometimes makes it harder,” says City Commissioner Dan Saltzman, the dean of the City Council.

Agency managers and city commissioners requested some $60 million worth of new projects by the Feb. 2 deadline, which would help fund an additional 138 full-time city positions or the equivalent. That doesn’t include emerging proposals for “special appropriations” that continue popping up.

But some say there’s a resolve among city councilors to fix what the city has, rather than go whole-hog into new initiatives, especially those outside the city’s core responsibilities.

“I think it’s going to be a theme of investing in our assets,” Saltzman says.

After the latest economic forecast in March, city budget analysts projected there will be $11.5 million a year available for new ongoing spending — nearly triple the amount projected three months earlier. Plus there’s another $19.6 million available in one-time spending — also a sizable bump from the prior forecast.

When city economists make their final forecast April 28, those numbers could grow higher, largely on the strength of business taxes flowing in around income-tax filing deadline.

But a fiscally conservative tone was struck by the council when Commissioner Amanda Fritz persuaded her peers to adopt a new policy devoting half the one-time resources each year to maintenance and infrastructure projects. That fits the “back to basics” theme that Mayor Charlie Hales used when he ran for election.

City commissioners also recognize they need to put their money where their mouth is if they’re going to seek new taxes or fees to pay for long-deferred road and sidewalk upkeep, especially in areas of East Portland that lack paved roads and sidewalks.

“I think there’s an understanding the public will be less skeptical about our ‘ask’ for transportation if we demonstrate that transportation is a priority,” says Commissioner Steve Novick, who oversees the Portland Bureau of Transportation.

There seems to be consensus around a list of maintenance projects developed by the City Budget Office that would devote nearly $10 million as required under the new policy. The office ranked the projects using criteria that councilors agreed on. The resulting list is heavily weighted toward roads and parks.

Not that all the commissioners are in agreement on how to spend the new money.

Several issues have emerged as they jockey for some of the surplus funds:

Low-income housing

The biggest one, dollar-wise, is $5 million requested by Saltzman for the Housing Investment Fund, a flexible pot of money to support low-income housing. That money would be used outside the city’s urban renewal areas, where funding is the tightest, Saltzman says. City Commissioner Nick Fish is a big supporter of the idea, but the City Budget Office didn’t endorse any of that request.

• Saving firefighters

A federal grant runs out at year’s end that funds 26 firefighters. Hales has talked about only funding half of those positions, and trying to find ways to charge for city-provided emergency medical services to raise more money.

But there’s behind-the-scenes talk that the city might cough up enough to save all 26 firefighter positions if the Portland Firefighters Association drops unfair labor charges. Those were filed against Portland Fire & Rescue’s switch to dispatching SUVs, known as Rapid Response Vehicles, to handle lower-risk emergency medical calls instead of more costly fire engines.

• Fixing the Portland Building

There’s little money in the proposed budgets so far to get started on this big-ticket item, but some of that is because city finance experts are still working up proposals for how to pay for it, including long-term bonds.

“We can’t keep sweeping it under the rug,” Novick says. “It houses 1,300 city workers. It would be very hard for the city to function if that building is emptied after an earthquake.”

He figures a 30-year bond could pay for it, if the city paid some $8 million a year. But that would gobble up the lion’s share of the ongoing money the city now expects to have at its disposal.

More on the list

With any extra funds being consumed by payments on a potential 30-year bond, the city council would have a harder time funding the laundry list of items that have received strong support among the council, such as Police Bureau improvements to properly serve the mentally ill and comply with a legal agreement with the U.S. Department of Justice; money to continue the East Portland Action Plan; and the Voz Workers Center, among others.

Then there are some requests for money that may be hard to resist, such as the joint city/county Home for Everyone homelessness initiative; the James Beard Market; improvements to the Columbia River Levee system; and the collaboration between Faubion Middle School and Concordia University.

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