The Portland City Council on Monday approved a $212 million budget for the fiscal year beginning July 1 that begins rebuilding city services cut during the coronavirus pandemic.
The budget, which reinstates 20.5 full-time positions of the 65 cut last year, is virtually unchanged from the one presented in April by City Manager Jon Jennings, whose spending plan would result in a 4 percent, or a 46 cent, reduction in the municipal side of the property tax rate.
City Councilor Nicholas Mavodones said the finance committee, which he chairs, had reviewed the budget in detail and offered its unanimous endorsement.
“I think this is a sound budget,” Mavodones said. “It weighs the impact the impact on taxpayers in Portland and really strategically looks at using federal funds to keep the tax rate down and backfill some revenues we hope will be there in coming years.”
The budget includes $212.2 million in spending from the general fund, plus an additional $56 million in self-funding enterprise accounts, such as the Portland International Jetport and sewer and storm-water fees, bringing the total to $268.2 million, not including school spending.
Councilors also discussed adding $43,000 to the Portland Public Library budget to pay for two part-time positions needed to reopen to the public. However, rather than adding that amount to the budget, which would have increased the mil rate by a penny on the city side, councilors agreed to find a way to fund the position outside of the budget, likely using coronavirus-related federal or state funding.
The city budget is $9.3 million larger than the current budget, but reduces the municipal portion of the tax rate, because it uses $8.75 million in federal funding to replace lost revenue.
Portland is expected to receive $48 million over the next two years and councilors will hold a workshop this month to devise a plan for using the money before it expires in 2025.
The council approval came the night before voters headed to the polls to vote on the Board of Public Education’s $125.5 million budget, which calls for an increased investment of $6.2 million from local property taxpayers. That proposal would increase the school’s portion of the property tax rate by 5.5 percent.
Between the municipal and school budgets, taxpayers would face a nearly 1 percent overall increase in property taxes, which translates to a $54 increase on a home with a tax-assessed value of $300,000.
The disparity between the city and school budget was a point of tension between the council and school board.
Only two people spoke during the public hearing about the city budget. One was Brackett Street resident Steven Scharf, who frequently criticizes city spending.
“I’m quite happy with the city budget,” Scharf said. “Unlike the school budget, the city has been quite fiscally responsible.”
The city’s Health and Human Services Department will see the biggest increase of any other department for the third year in a row.
The department would receive a $2.7 million, or 8 percent, increase – the vast majority of which will go into the city’s General Assistance program, a voucher-based safety net program that helps people pay for rent, food and other necessities. GA would see an increase of $2.1 million, or 14.3 percent.
Permitting and Inspections could see a $246,000, or 12.8 percent, increase, in funding, which Jennings, the city manager, said was driven primarily by new positions needed to implement the five citizen referendums that passed in November. Those include two positions to manage the rent control ordinance and two other positions to handle marijuana retail licensing. Jennings expects those costs to be offset by additional revenue.
And public works could see a nearly $796,000, or 5.8 percent, increase next year to fill engineering positions, an island maintenance worker and a project coordinator.
Back in April, the city said the pandemic had resulted in the loss of $28 million in revenue over the last year and a half from parking, parks and recreation, cruise ships, excise taxes and more.
Jennings and the city’s finance director plan to wean the city off the federal funding over the next few fiscal years. They’re proposing to use $5 million to $6 million in fiscal year 2023 and $2 million to $3 million in fiscal year 2024. That would leave roughly $30 million to $32 million in unallocated federal funding.
“We’re hoping to see revenues bouncing back faster than having to go through another two years,” Jennings said.
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