"BACK TO BASICS"—embodied in talk of potholes, crumbling roads, and idled paving trucks—was a rallying cry for the disaffected and the disillusioned when Portland Mayor Charlie Hales laid his claim to city hall's highest office in 2012.
Before we raised money, Hales said, we needed to figure out how we were spending the money we had. It carried Hales through his first city budget as mayor, when he and his colleagues on Portland City Council closed a $20 million-plus spending gap with deep cuts.
But these days, Hales has been saying something else. That there isn't enough money in the till to pay for those basics, or those crumbling roads. And Hales and Commissioner Steve Novick have all but staked their political futures on an incredibly contentious plan to raise millions more in new money: a street fee worth up to $50 million a year.
Yes, the city reaps millions every year in property taxes, business taxes, and utility franchise fees. But too little goes to our roads, Hales and Novick have been forced to point out. Relentlessly.
So how about the rest of that revenue? Where do your property taxes actually go? The Mercury decided to take a look. Staffers at the Portland City Budget Office mocked up a hypothetical property tax bill at our request—for a median-priced home assessed at $152,890—and figured out how the resulting $3,689.75 tax payment would trickle its way through government.
The majority of your tax bill, it turns out, doesn't even make it to city hall. Schools, Multnomah County, and Metro all get a taste. And then, when the city does get its share, a little more than $1,500, more than half is spent largely outside city hall's control—on pieces like urban renewal projects and public safety pensions (which float up and down to keep pace with costs every year).
And as for the $631.24 from your bill that city hall does get to decide to how to spend?
More than half of it, $374.81, goes to the fire and police bureaus. And the next biggest chunk, $71.10, goes to parks. Everything else, from transportation to housing to planning to debt service to reserve funds, to pay raises, to city administration, must fight over the $185.33 that's left. The Portland Bureau of Transportation (PBOT), which gets much of its discretionary money from stagnant gas-tax receipts, gets just $14.66.
Here's what that means: There's plenty of money in the budget to pave our streets—that is, if you're willing to execute a few sacred cows. Want to find $50 million without raising new money? Then get ready to lay off hundreds of cops, let some park grass grow wild, and close some fire stations. Or give up on urban renewal projects. Or fire political staffers and gut every other program and bureau that makes up a decent, thriving city.
Good luck with that. You may hate a street fee—or whatever else Hales and Novick put forward to make money. But you might hate the alternative even more.
"It's valuable for people to know that at all levels, what government spends money on, for the most part, is the same old regular meat-and-potatoes stuff," says Novick, who oversees PBOT. "In pretty much every city, the biggest items are police and fire. And it's probably been true since the days of William the Conqueror, if not before."
MANY TAXES, MANY TAKERS
PORTLAND ACTUALLY SEES LESS THAN HALF OF YOUR TAX BILL
HOW CITY HALL SPENDS THE $631.24* FED TO ITS GENERAL FUND
MORE THAN HALF GOES TO PUBLIC SAFETY!
1. PORTLAND POLICE BUREAU: $235.87
2. PORTLAND FIRE AND RESCUE: $138.94
ANOTHER BIG CHUNK GOES TO PARKS
AND CITY OPERATIONS
3. PORTLAND PARKS AND RECREATION: $71.10
4. OFFICE OF MANAGEMENT AND FINANCE: $25.97
EVERYTHING ELSE—LIKE HOUSING AND TRANSPORTATION—FIGHTS OVER THE SCRAPS
5. PORTLAND HOUSING BUREAU: $19.29
6. DEBT SERVICE $18.17
6. BUREAU OF EMERGENCY COMMUNICATIONS: $18.17
8. PORTLAND BUREAU OF TRANSPORTATION: $14.66
9. COST-OF-LIVING PAY ADJUSTMENTS $12.21
10. SPECIAL APPROPRIATIONS: $12.16
11. BUREAU OF PLANNING AND SUSTAINABILITY: $10.79
12. OFFICE OF NEIGHBORHOOD INVOLVEMENT: $10.17
* The city's general fund—the city council's pot of discretionary spending money—also includes utility license fees and business taxes. Property taxes make up just 48.5 percent of that overall pot of money.
SOME BUREAUS FEAST ON PROPERTY TAXES, OTHERS JUST SNACK
For all the millions the city receives every year in property taxes, other sources of revenue are just as important to making sure our neighborhoods are safe, our toilets get flushed, and our roads occasionally get paved. Utility bureaus like water and environmental services are funded by ratepayers and bond sales. Transportation is funded in part by state and national gas tax returns, as well as parking receipts. But even property-tax-heavy bureaus, like police, fire, and parks, often tap other pots of cash—like business tax receipts, grants, permits, and other assorted fees.
A LITTLE BIT OF HISTORY
According to the most recent stats from the Bureau of Economic Analysis, real total personal income in Multnomah County rose 24 percent from 1999 to 2012. The city's property tax haul, meanwhile, has doubled since the 1999-2000 fiscal year, up to $450 million from $225 million. (Adjusted for inflation, it's actually gone up only about 40 percent.) But the share of property tax revenues that the city most directly spends—the cash that goes into the city's general fund—has actually gone down since that time period. What's behind that? A much larger share of tax bills has been going to urban renewal.
