The Portland City Council unanimously approved a $5.1 billion annual city budget Wednesday, devoting substantial new sums to funding a city-county agency fighting homelessness and to the Portland Police Bureau, for hiring 49 new officers.

Much of the multibillion-dollar budget, which increased 8.5 percent year-over-year, is spent on construction projects, infrastructure maintenance and debt payments. The council controls only a relatively small portion -- $566 million, an 8.6 percent increase from last year -- and that fund pays mostly for police officers, firefighters, parks maintenance and bureau operations.

But the budget includes several notable new items: $31 million for the city-county Joint Office of Homeless Services, a 10 percent increase from last year's allocation; $5 million for additional police officers; and a $500,000 special appropriation to pay for legal services for Portland immigrants facing deportation.

To help pay for those increases and others, commissioners increased Portland's local business tax by $15 million. It is the first increase to the tax rate since the 1970s. Commissioners also upped a deduction to cushion the effect of the tax increase on small businesses.

Mayor Ted Wheeler's proposal to hire more police officers and a plan to close two community centers was a flashpoint for some residents' outrage. Hundreds packed public budget forums in recent weeks to protest those ideas, with some activists saying the Police Bureau had enough officers and parks supporters and senior citizens rallying to keep the community centers open. The budget proposal was the first Wheeler oversaw fully since becoming mayor in 2017.

Ultimately, Wheeler reduced the number of patrol officers he plans to hire from 52 to 49 and conceded to requests to keep the Fulton Park and Hillside community centers fully funded. Portland Parks & Recreation still took a sizable budget cut, at nearly $1 million. The Bureau of Planning and Sustainability took the biggest cut by percentage, a full 5 percent, resulting in elimination of three vacant city planner jobs.

Wheeler, acknowledging criticism of his plan to put more police on Portland streets, said Wednesday he recognizes that the city budget is a "moral document" and that he and critics have legitimate disagreements on policy.

"You may think I forget sometimes, but I never forget who I work for," Wheeler said from the dais, referencing the electorate. "That doesn't mean I'm always able to forge a consensus on every single issue." He said the budget is an imperfect foundation to build upon, but "as perfect as I think we can get it here today."

The council adopted one major amendment, brought by Commissioner Chloe Eudaly, which stripped language from the budget committing the council to avoid future business tax increases. The amendment passed 3-2, with Eudaly, Commissioner Amanda Fritz and Commissioner Nick Fish voting in favor and Wheeler and Commissioner Dan Saltzman opposed.

Eudaly lamented the lengthy and politically fraught budget process before voting in favor of the spending, saying bureaus tasked with cutting their own budgets offer programs for the chopping block that alarm the public, sparking public outcry from residents "with little or no knowledge of other budget issues."

"It feels like we live on different planets based on what people's burning issues are," Eudaly said, adding, "We need a more thoughtful and meaningful process."

For his part, Wheeler, a former state treasurer and county chairman, emphasized his concern with the city's fiscal responsibility, saying Portland is "exposed" in the event of an economic downturn.

"People rely on the city of Portland to provide services come hell or high water," the mayor said. "We need to be fiscally responsible in our budget and fiscally sustainable over the long run to continue to deliver those services come hell or high water." Wheeler added: "This budget does that."

The budget now heads to the county Tax Supervising & Conservation Commission, which must give its seal of approval. Once that is done, the council is expected to adopt a final budget in early June, largely a formality.

-- Gordon R. Friedman

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