An analysis of finances for the city of Portland suggests moderate good news in the weeks ahead.
A projected shortfall of $25 million for the 2013-14 fiscal could fall to $21.5 million, according to City Economist Josh Harwood.
His analysis comes a few weeks before the budget forecast, which is scheduled for the end of April.
“Final forecast figures have yet to be compiled,” Harwood said. “We’re looking at some moderately improving economic indicators. Right now, they point to a slightly better forecast for the end of April.”
The city also could have an estimated $800,000 in one-time resources available for use, he said.
Mayor Charlie Hales aid he was cautiously pleased. “While the budget preview is good news, the city still faces a shortfall and we still cannot use deficit funding,” Hales said. “The new projection, if accurate, softens the impacts of the decisions we face.”
Upon taking office in January, Hales asked every bureau to submit a budget for 2013-14 that is 10 percent below current budgets, in order to address the projected shortfall.
Harwood met with Hales and his staff last week. He said causes for the April uptick include:
• The consumer price index is down for the region.
• Health care premium costs are lower than expected.
• The real market value of property is up.
• An increase in property affects “compression,” the rule created by a series of tax measures in the 1980s and ’90s designed to reduce property taxes. Compression reduced funds for the city of Portland, in part, to pay for a Multnomah County library levy OK’d by voters last November.
“This is just a step in the process,” added Andrew Scott, budget director for the city. “The full forecast, including that of the volatile business licenses tax, will be released at the end of the month.”
Mayor Hales and the City Council are in the midst of the budget-crafting process, which is expected to extend into May.
News release: City of Portland