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Posted on: April 26, 2022

Interim City Manager Presents FY23 Recommended Budget

Newsflash 2022

Facing significant increases in costs that are necessary to address including, but not limited to, General Assistance, inflation, debt service, County tax, and others that are outside of the City of Portland’s control, Interim City Manager Danielle West tonight presented her FY23 Recommended Municipal Budget to the City Council during the April 25, 2022 meeting. 

In light of all the significant cost increases, the recommended budget currently includes a 5.5% increase in the tax rate on the City side of the overall budget with a new city-side mill rate of $6.56 per $1,000 of assessed property value. If it weren’t for the use of $5.5 million in ARPA funds, as well as the use of debt service reserves and an increase in state revenue sharing in this budget, the City would be looking at a projected tax rate increase of approximately 17% to maintain current levels of municipal services. Additionally, in order to balance the budget, the proposal includes raising the rates of some fees, including an increase in parking meter fees in the Old Port and Commercial Street areas and an increase in the pay-as-you-throw trash bag fees. 

Interim Manager West explained, “thanks to our efforts with our state and regional partners, we learned on April 25th that the City is expected to receive a portion of one-time state funding to address emergency housing of homeless individuals. While this is welcome news, the 5.5% tax rate increase currently included in this budget may still need to be adjusted and/or additional cuts imposed since this one-time funding is significantly less than we anticipated. We plan to work diligently with the Council to address this issue through the upcoming Finance Committee budget review process.”  

Interim Manager West continued, “while the budget challenges we face are very serious, it is also important for me to balance the needs of our workforce. As a result, this budget does include funding for some retention strategies given the extremely tight labor market and the significant number of vacancies we have. I recognize that the pandemic has certainly exacerbated the challenges that local government’s face with recruitment and retention, and that is why the proposed budget includes cost of living adjustments and capping City health insurance premium increases at 2% for employees.” 

The 5.5% City side tax rate increase for municipal services means the city-side mill rate is $6.56 per $1,000 of assessed property value. The impact on an average homeowner with a property valued at $350,000 would be $119.   

The Finance Committee will have its first budget review meeting on April 28, 2022 at 5:00 PM. It will then meet throughout May before the budget goes to the full Council for review and adoption. To read the full budget recommendation letter and to follow along with the Finance Committee and Council review/budget adoption process, please visit this webpage

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