In this week's Hall Monitor, I wrote about Commissioner Nick Fish's decision to hire Traci Manning, currently the operations chief at Central City Concern, as Portland's new housing director. But after all the lauding, I briefly raised a sticky situation that will test Manning's skills as a coalition-builder: a severe drop-off in funding for public housing construction.

It's not a new concern. Fish has been raising it for a couple of years—and hence we've periodically reported on plans for the Portland Housing Bureau to go to voters for help approving a new tax that would provide a stable source of cash. Fish had some bad news when I asked him about that this week. After watching the 2010 election season come and go, we might also be watching 2012 come and go, too.

"In two to three years, we'll have something ready to go to the voters, something that's been fully vetted by the community," Fish said.

He was mindful of the difficulty of asking voters for cash in a tough economy and at a time of skepticism about government.

"Given the experience with the school bond measure, given the number of other funding measures already planned for the ballot, and given what we've learned about the work we need to do to make the case for the voters that affordable housing affects everybody, we're still a couple of years out," he added, before striking a faint note of optimism: "But that's not definitive."

Why is the funding falling off in the first place? Keep reading.

That drop is called the "TIF cliff," among wonks, and they've given it that name because the city's current mechanism for funding affordable housing relies on tax-increment financing—the extra revenue that flows into city coffers from Portland's urban renewal districts.

The problem? Most of those URAs are getting old, after decades on the map, and have been mostly built out to capacity. That means much of the extra revenue generated from new development is drying up.

For the housing bureau, a budget of more than $100 million this fiscal year will plunge to less than half that sum. Which will make it difficult for the city to continue rehabilitating old SROs or build or contribute to showpiece projects like the Bud Clark Commons.

Also not helping: federal grant money also may fade, thanks to Tea Party shenanigans in Washington DC.

In the meantime, Fish hopes Manning will help the city and county work together more closely, spreading their respective budgets further by not duplicating their efforts. Fish calls it "alignment."

"Real alignment is you look at mental health, health care, workforce development, and housing."