Portland Parks & Recreation is facing a potential $7 million shortfall in next year's budget — 7.5 percent of its approximately $94 million operating budget.
Commissioner Nick Fish, who was assigned the parks bureau four months ago, says the because costs are outstripping revenues, the City Council will have to make "hard choices" about the budget. Fish says he has already curtailed spending.
"Effective immediately, I have directed PP&R to severely limit hiring, spending, and training. As we develop a sustainable plan to bring costs in line with revenues, we'll continue to consult with the community," said Fish, adding, "My goal is to put PP&R on solid financial footing while continuing to deliver the high-quality services our community expects."
The bureau had previously been overseen by Commissioner Amanda Fritz.
Bureau employees are being told of the problem in a series of personnel meetings that began at noon on Wednesday.
According to a sheet of Frequently Asked Questions distributed to the employees, the potential shortfall was discovered as the bureau began preparing its request for next year's budget under a new process introduced by Mayor Ted Wheeler that requires city agencies to rebuild their budget from the ground up.
"When I was asked to lead Portland Parks & Recreation four months ago, I began by taking a deep dive into our budget and programs," Fish said. "Mayor Wheeler's new budget process has allowed us to take a fresh look — line by line — at our proposed budget."
The shortfall is largely caused by personnel costs increasing faster than revenues generated by the bureau, the FAQ sheet says. More than a quarter of it revenues come from fees for programs, which the City Council has kept low to encourage publi participation.
"Personnel costs are growing at a fast pace. In 2016, we added more than 100 new full-time employees following a labor arbitration. But between Council allocated General Fund and program fees, we can't keep pace with growing costs for healthcare, PERS, cost of living adjustments, and other benefits."
In response to the problem, bureau hiring, training and other spending was limited on Jan. 22. The exact shortfall will revealed when the bureau submits its request for the budget that starts on July 1 on or around Feb. 4. Options for closing the gap will be discussed at a council work session that will be held in March. The date has not yet been determined.
