Budget 101

www.portlandonline.com/communitybudget

City of Portland, Oregon

Fiscal Year 2011-12

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 Learning Objectives

z Understand how the budget relates to City

services.
z Understand where City money comes from
and where it goes.
z Understand the budget process
– How the budget is developed
– How the community can provide input

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 Jurisdictions

z Government services are provided by a

variety of jurisdictions in the Portland area.
z Each one provides a different set of services.

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 Who Provides the Services I use?
CITY OF STATE OF MULTNOMAH SCHOOL
PORTLAND OREGON COUNTY METRO DISTRICTS TRI-MET
City Streets, Highways,
Transportation Sidewalks DMV Bridges Bus, Max
Police, Fire,
Public Safety 911 State Police Jails, Courts

Info & Referral 823-4000 Libraries, 211

Parks, Golf,
Portland Int'l
Parks & Recreation Raceway
Education SUN Schools Funding SUN Schools K-12 Schools
City Streets,
Planning & Development Sidewalks Land Use Regional
Business Licenses X X
Garbage X X
Sewer X
Water X
Housing X
Employment Office X
Health & Social Services X
Animal Services X

4 Zoo X
 City Service Areas
z Transportation
– Traffic, Parking, Street Car, Road Maintenance
z Public Safety
– Police, Fire, Emergency Management & Communications
z Parks, Recreation & Culture
– Parks & Recreation, Golf, Portland International Raceway
z Public Utilities
– Environmental Services (Sewer), Hydroelectric Power, Water
z Community Development
– Development Services and Permitting, Planning and Sustainability, Neighborhood
Involvement, Housing, Cable
z Legislative, Administrative & Support
– Attorney, Auditor, Government Relations, Human Relations, Management & Finance

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 Budget

z A plan for the acquisition and allocation of

resources to accomplish specific purposes.
z The Budget provides the strategic direction
the City intends to take over the coming fiscal
year.

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 The Budget and Services

z Funding for the City’s core services are

divided into two parts:
– General Fund – Includes services such as Public
Safety, Parks & Recreation and Community
Development.
– Non-General Fund – Funds infrastructure
spending such as transportation, water and
sewer.
z Where the money comes from often
determines how it can be spent.
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 Where does the money come from?

z Bond and Note Proceeds

– Bonds and notes are sold to the public to fund major infrastructure projects.
z Beginning Fund Balance
– The remaining balance of City resources each year, after liabilities are deducted. This
represents a major portion of resources that will be spent in the next year.
z Service Charges and Fees
– Fees and charges collected for services such as water, sewer and parks usage.
z Taxes
– A portion of property taxes collected by the County are available to the City. Other
taxes include the Lodging Tax, Business Income Tax and Gas Tax.
z Grants
– Assistance provided by other organizations to help fund specific programs.
z Licenses and Permits
– The City sells licenses and permits that regulate activities such as construction,
business and use of public spaces.
z Miscellaneous Revenue
8 – Includes investment interest, Capital Asset Sales, Assessment Collections, Misc.
Sales, Private Grants and Donations, Loan Repayments and Refunds
 Allocating Resources

z Many funds are dedicated to specific uses based on

their source.
– Water and sewer fees pay for water and sewer system
maintenance and improvements.
– Permit fees pay for development services.
z The General Fund is the pool of general City
resources, that are not set aside for specific uses.
– These come from property and business taxes.
– Allocated based on City Council priorities.

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 2010-11 Budget

$3,429,943,414
All funds combined, Total Budget

$451,812,997
Total General Fund Budget

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 Discretionary vs. non-Discretionary

z Non-Discretionary funds are restricted to specific uses.

z Discretionary funds are allocated based on service priorities.

General Fund - FY 2010-11

Source: City of Portland FY 2010-11 Adopted Budget, Volume 1, page 90

Non-Discretionary Resources
18.2%
Discretionary Resources
$82,226,000
81.8%
$369,586,997

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 General Fund Resource Summary

Resource Budget Percent

Property Taxes $ 191,959,956 42.5% Business

Utility License
Licenses
Fees
Utility License Fees 70,478,905 15.6%

Business Licenses 57,831,084 12.8% Transfers from

Other Funds
Transfers from Other Funds 52,519,607 11.6%

Service Charges & Other 26,998,422 6.0% Service Charges

& Other
Intergovernmental 25,893,139 5.7%
Intergovernmental
Lodging Taxes 14,524,258 3.2% Lodging Taxes
Property Taxes Beginning Fund
Beginning Fund Balance 11,607,626 2.6% Balance

Total General Fund Budget $ 451,812,997 100.0%

12 Source: City of Portland FY 2010-11 Adopted Budget, Volume 1, page 27

 General Fund Expenditure Summary

Resource Budget Percent

Parks,
Public Safety $ 259,727,348 57.5% Leg, Admin Recreation, &
& Support Culture
Leg / Admin / Support 77,726,519 17.2%
Community
Development
Parks, Recreation, & Culture 60,731,096 13.4%

Community Development 33,837,617 7.5% Reserves and

Other Transfers
Transportation & Parking 11,472,212 2.5%
Transportation
Reserves & Other Transfers 8,303,205 1.8% & Parking

Public Utilities 15,000 0.0%

Total General Fund Budget $ 451,812,997 100.0%

Public Safety

13 Source: City of Portland FY 2010-11 Adopted Budget, Volume 1, page 28

 Current Financial Outlook

z Portland is in a better position than most regions.

– Our sources of revenue are more stable (less cyclical).
– Early and aggressive budget actions taken by the Mayor
and City Council the last 2 years.

z Public investment in the economy is still essential.

Focus on:
– Public infrastructure and housing.
– Local businesses and workforce development.

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 Financial Outlook Continued

z Public safety bureaus: cuts of 0.75%.

z Non-public safety bureaus: cuts of 1.5%.
z General Fund forecast shows a surplus of $11.2
million in FY 2011-12 (assuming current service
levels), however, those resources will be required to
offset expenditures in future years.
z Current General Fund 5-year forecast cannot sustain
current service level expenditures without program
reductions or new revenue sources.

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 FY 2011-12 Budget Process
Requested Budget Requested Budget Approval
Development Budget Review & Adoption

Nov Dec Jan Feb Mar Apr May Jun

Financial Utility Rate
Budget Forecasting and
Planning Reviews Review Hearings
Kickoff Budget Instructions

Bureau Budget Council Reviews Mayor Proposes Council Adopts

Council Focuses Budget
Requests Budget Requests Budget
Budget Initiatives

Budget Committee
Bureau Budget Advisory Committees Meet
Review

Community Community Community

Budget Partnership Budget
Forums * Events * Hearing *

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 Preliminary Budget Stage

z November - December
– Council Goal Setting Sessions
z Strategic Issue Identification & Affirmation
– Financial Forecast
– Budget Guidelines to Bureaus
z Council goals and priorities
z Strategic issues and challenges
z City financial condition
z Financial forecast

Bureaus meet with their own advisory

Get Involved:
committees
• Bureaus & hold
meet with their community
own advisory meetings
committees
& hold community meetings

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 Requested Budget Stage

z Feb – Bureaus Submit Requested Budgets

z Jan – March
– Citywide Community Forums
– Community Partnership Events
– Online Commentary
– Public Surveys
– Council Work Sessions with Community Budget Advisors &
Bureaus

Get
2-3 Involved:
Public Forums in the Community (Small Group
Discussions
• 2-3 publicwith Bureau
forums Directors
in the & City Council),
community
Survey Period, Community Partnership Events
• Surveys
• Community partnership events
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 Proposed Budget Stage

z March - late April

– Mayor’s Proposed Budget – internal meetings
z Financial Planning analyzes requested budgets and
writes issue papers
z Discussions with Financial Planning, bureau directors,
and commissioners
– Mayor announces budget decisions
z Online testimony is taken

Get Involved: community partnership event

• opportunitiesOnline
Ongoing community testimony opens
partnership events
as soon as Mayor’s decisions announced!
• Online testimony once the Mayor’s decisions are announced

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 Approved Budget Stage

z May - June
– Community hearing
– City Council hearing & budget approval
– Tax Supervising Conservation Commission
(TSCC) Hearing
z Independent review and hearing on the Approved Budget

Evening Hearing on Proposed Budget in

Get Involved:
theHearing
• Evening Community fortestimony
for public Public Testimony,
on the
electronic and written testimony continues
Proposed Budget
• Electronic and written testimony continues

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 Adopted Budget Stage

z Late June

– Technical adjustments
– Budget adopted in late June
– Budget monitoring process in fall, winter, spring track
progress on budget decisions

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www.portlandonline.com/communitybudget

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