Portland Getting Steep Increase to METRO Assessment for Fiscal Year 2027

[George Rheault]

Details to follow this evening at the Council's Finance Committee meeting...

Remote Finance Committee Meeting • City of Portland Meetings & Agenda Portal • CivicClerk

[Scsmedia]

$600K is chump change.

 2026 Metro Assessment and Council Options

On October 31, 2025 Metro submitted their 2026 budget to the City. The budget includes an assessment increase for Portland of 20% or approximately $600k. Should the Council choose to reject the budget, such rejection must occur within 30 days. Acceptance of the budget and local assessment can occur by taking no action (simply a City Council Communication on a November agenda) or by a formal vote of acceptance. Due to the significance of the increase the budget will be initially discussed at tonight’s Finance Committee meeting to ensure Council support. City and METRO staff will be in attendance to discuss the increase for FY27, the service level enhancements, outlook for FY28, and why the budget is being recommended for acceptance. This is a discussion item only, no action is scheduled at the current meeting

The FY 2027 budget will have a theoretical $22 million windfall from the retirement of the Pension Obligation Bonds.  The council created an account to fund payments for the bonds from other bonds that were refinanced at lower rates, thus creating a saving.  Brendan O'Connell tried to explain this to me in more detail.  I hope I can get a council memo out of him on it.

FY 2027 will not be a year we will be talking about cutting budgets.  My fear is that they will try to spend the who $22 million.

We should be advocating to spend 1/3 on direct CIP (ie. start paying for stuff directly and move away from bonding, 1/3 on yearly budget allocations and 1/3 back to the taxpeyers (ie. reduce the tax rate).

Steven Scharf

207-415-4662

SCSM...@aol.com

On Thursday, November 6, 2025 at 09:05:33 AM EST, George Rheault <george....@gmail.com> wrote:

Details to follow this evening at the Council's Finance Committee meeting...

Remote Finance Committee Meeting • City of Portland Meetings & Agenda Portal • CivicClerk

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[George Rheault]

Viewed against GPMETRO's history of budget increases over the last decade, this $600K is a big increase.  It will be interesting to see how it is explained (possible retreat of federal funding due to Orange Man Regime?) but it might have longer term implications if Portland has to shoulder more of the cost of GPMETRO service vs. other communities.

As to the Pension Obligation Bonds burning off, that money is not really available for tricks and treats.  Portland's CIP has been woefully under budgeted for DECADES (partly due to the Pension Obligation gorilla on its back) and between regular inflation and the much higher costs in general of getting anything built today in the public sector, the new spending flexibility must be immediately dedicated to long deferred projects.  Our schools for example are falling apart to the tune of $300 - $500MM of deferred investment.  Then things like street paving and other infrastructure means that the money shouldn't be used for tax decreases until the backlog of capital improvements is substantially reduced.

Bonding is very efficient.  Portland has worked hard to become a very good municipal credit buy and bonding helps stretch our purchasing ability.  It would be absurd to waste our excellent credit rating by stupidly paying cash for stuff that we could do better through bonding.

ALSO, we need to create more capacity in-house in City Hall.  Right now we lack enough quality project managers, designers and engineers to get things built.  Unless we have the capacity to quickly design, bid and manage capital projects efficiently, everything Portland does will take longer and cost more money - starving other future projects of revenue.  And quality control and contractor management is the best way to prove to the taxpayers that City Hall can carry out the promises it makes when projects get approved.  

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[Winston Lumpkins]

I haven't fact checked this, but, I think this METRO increase is to cover federal funds which where temporary in nature, some pandemic or infrastructure act funds which where used to pilot the improvements to route 5 & route 7 serving Congress Street and the airport abd Mall much, much better.  

In order to fund those improvements long term, we where always going to be asked if we wanted them or not; we could always go back to alternate 90 minute service at the mall & airport, and fewer options for getting down Congress street, but I will be strongly advocating for keeping these improvements. 

Public transportation isn't free, but is very helpful for those of us who don't have access to cars, and can help reduce traffic in the long run, though, I'm not sure how much ridership has been increased by these improvements- they've been advertised pretty lacklusterly if you ask me. 

Presumably ridership will be a topic in the presentation to the finance committee.... 

-Winston 

Winston Lumpkins IV (he/him/his)

Past Chair, Portland Bicycle & Pedestrian Advisory Committee
https://www.portlandbikeped.org/

winston....@gmail.com
207-408-1508

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[Scsmedia]

There are some useful docs at the link,

https://portlandme.portal.civicclerk.com/event/8324/files/attachment/28185

The presentation provided a through explanation.  I will watch the meeting later.

Steven Scharf

207-415-4662

SCSM...@aol.com

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[George Rheault]

Thanks.  There was no presentation posted this morning.

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[Damon Yakovleff]

George, excellent points. I will add that, not only do we need to use the pension obligation bond for long-deferred maintenance, we will also need it to plug the holes in the school and municipal budgets created by the Trump administration. Not only that, but we can (hopefully) also leverage some of the funds to continue work on the grant-funded projects that were rescinded. 

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