Portland City Council Finance & Governance Committee (Whole) 04/23/26

7:15Good morning.

7:16I call the meeting of the Committee of the Whole to order.

7:19It is Thursday, April 23rd at 9:32 AM.

7:24Diana, will you please call the roll?

7:26Good morning, everyone.

7:28Pirtle-Guiney?

7:29Here.

7:31Ryan?

7:31Here.

7:32Koyama Lane?

7:35Here.

7:36Novick?

7:37Here.

7:38Smith?

7:40Here.

7:50Dunphy.

7:50Here.

7:51Kanal.

7:52Here.

7:55Christopher, will you please read the statement of conduct?

7:59Welcome to the meeting of the Finance and Governance Committee of the Whole.

8:01To testify before this committee in person or virtually, you must sign up in advance on the committee agenda at www.portland.gov/council/agenda/committee-whole or by calling 311.

8:11Information on engaging with the committee can be found at this link.

8:14Registration for virtual testimony closes 1 hour prior to the meeting.

8:16In-person testifiers must sign up before the agenda item is heard.

8:19If public testimony will be taken on an item, Individuals may testify for 3 minutes unless the Chair states otherwise.

8:24Your microphone will be muted when your time is over.

8:26The Chair preserves order.

8:27Disruptive conduct such as shouting, refusing to conclude your testimony when your time is up, or interrupting others' testimony or committee deliberations will not be allowed.

8:34If you cause a disruption, a warning will be given.

8:35Further disruption will result in ejection from the meeting.

8:38Anyone who fails to leave once ejected is subject to arrest for trespass.

8:41Additionally, the committee may take a short recess and reconvene virtually.

8:44Thank you.

8:45Thank you, Christopher.

8:47In a moment, I'm gonna pass it over to Council President Dunphy for a couple introductory comments, but I wanted to first say welcome to the 3rd meeting Committee of the Whole.

8:54This is a little different, uh, than the previous 2, and frankly anything we've done in the last 15 months and perhaps for many years before that, in that this will be an oversight hearing.

9:03We're going to spend some time explaining what happens before we get into it, um, but please bear with us as we, uh, test out a new process.

9:10With that, I'm good.

9:12Council President Duffy says he's good.

9:14Uh, so, all right, uh, today's an important day for us as a body and for Portland's new form of government.

9:20Thank you, Councilor Smith.

9:20Today, the council is holding its first oversight hearing, exercising for the first time an authority granted to us in Portland's new charter.

9:26I recognize that we did not come to the process that led us to today unanimously, and that some councilors come to this hearing with concerns about how it will go.

9:34Whether you share in those concerns or not, I hope we can all approach today with an appreciation for the critical role of oversight in democratic systems and respect for council's duty to exercise its oversight role with rigor and with respect.

9:45It's a great honor for me to chair this first oversight hearing.

9:48I've taken great care to work with the council president's office to prepare a format to today's that I hope will foster respectful discourse, public trust, and transparency.

9:57Oversight is critical to good governance.

9:58It's our duty to carry out this responsibility without fear or favor.

10:01We're here on behalf of the people who put us here and who need to know that their government is accountable to them and that we, their representatives, will ask questions and investigate discrepancies on their behalf.

10:12Oversight and accountability are not the same as punishment and blame.

10:16The purpose of oversight is to improve efficiency and effectiveness and transparency of government operations, evaluate performance and programs, detect and prevent waste and unlawful conduct, and ensure executive policies reflect the public interest.

10:29And we can do all of this respectfully.

10:32As a result, I'll be strictly enforcing our rules related to order and decorum today.

10:37Oversight is too critical to the effective functioning of our system of government to let today's hearing be our last oversight hearing because we failed to do it well.

10:44And in that spirit, I'll highlight 3 of the council rules specifically before we get— begin.

10:49The first is councilors should confine themselves to the question under debate.

10:53This means keeping comments within the scope of the 4 questions in the oversight resolution passed by council.

10:59This is not a hearing to litigate how the Housing Bureau dollars could or should be spent, and I'll call to order councilors who veer into that debate.

11:06Secondly, councilors should refrain from personal criticism.

11:10This applies to fellow councilors as well as the members of the administration who are invited to be here today.

11:14We sent out a run of show with the 7 members of the administration who will be present today.

11:20We can make our points without attacking and shaming each other.

11:23And finally, each councilor will have 10 minutes during Q&A to ask questions of invited guests.

11:29Each councilor's time includes response time.

11:32So I'm asking our invited guests to please answer questions as succinctly as possible.

11:36And for councilors, you feel free after— members of the administration should have a chance not only to say a yes or no, but at least a couple sentences, ideally more than that, depending on what your question is.

11:48But if there is time remaining after each councilor has had their opportunity, I'll return to council.

11:51Thank you.

11:51Councilors in the queue.

11:53Um, I'm actually— I should have had Diana read the, the item first, so I'm going to pause here and let her do that.

11:59Diana, would you please read the, the first item?

12:02Item number 1, document number 2026-140, oversight hearing on unbudgeted Portland Housing Bureau funds.

12:12Great.

12:12Um, any questions on the rules that I just laid out before we get started?

12:17Any objection to Yes, please feel free.

12:26This is a unique situation.

12:27I'm a little bit surprised, Chair, that we don't have an attorney with us on the dais.

12:31I think that that would be most appropriate.

12:35Yeah, I see Robert Taylor's hand going up.

12:39Um, okay, thank you.

12:44Councilor Zimmerman, does that address the concern?

12:46Yes, thank you.

12:48Thank you, Councilor.

12:49Anything else from anyone before we get going?

12:51All right, Councilor Pirtle-Guiney.

12:55Thank you, Chair.

12:57With an attorney coming up here, I appreciate that you're gonna hold us all to a standard of decorum and professionalism during our conversation today.

13:09I think that's really important.

13:11I also think it's really important if we start to veer toward anything that would be a better conversation for executive session, that we know that.

13:20So I would just ask that with an attorney on the dais with us, you and our attorney are in close communication to make sure that we don't cross any lines of legality.

13:32Thank you for that reminder, Councilor Pirtle-Guiney.

13:34And I'm sure Robert Taylor and I can make eye contact as needed if there's a reason, or feel free to jump in and let us know.

13:41Thank you.

13:42We welcome that.

13:43All right, well, with that, I'm gonna just note one other thing, and these are not rules, but these are my suggestions as someone who's gone through some uncomfortable conversations in the past as things that can help with ensuring that things don't get off the rails before a rule is violated.

14:01So take these as suggestions.

14:03This is the first hearing.

14:04We only have a limited time.

14:06So I'd suggest as a first understanding, accepting non-closure.

14:10We will probably not answer every question that there is in this time.

14:14We talked about treating others with respect.

14:16And the third thing I'd say is stepping up and stepping back.

14:18And that means ensuring that your colleagues, but also the subject matter experts, have the opportunity to give their time, but taking yours as well.

14:25And just understanding and being aware of that balance as we go forward.

14:30With that, I'm gonna pass it over to City Administrator Lee for any introductory comments he may have, and then over to the, the resolution sponsors.

14:40Thank you, Committee Chair and Vice Chair and both Vice Chairs with this committee.

14:47Thank you this morning for having us.

14:49You know, as we go through this conversation today, I just want everyone to remember, I think everyone's intent and purpose of this is to produce something that is beneficial not only to this board and this organization, but something that speaks to The community as a whole and accountability and the measures that we're willing to take to ensure that we have a transparent process, that we're being accountable and responsible to our community and our city as a whole.

15:21And as city staff and as administration, we have that commitment not only to this body and to our electors, but to the community we serve at large and also to the employees that report to us and that do the hard work producing services to this community day in and day out.

15:41They have my trust from that standpoint, and they have my support as we continue to provide services to this city.

15:50Yesterday evening, we provided a report that under attorney-client privilege as it relates to my Uh, investigation of this matter as well.

16:01As previously, uh, communicated to this body, that I would go through my own analysis of this situation to ensure that everything that has been done to this point meets the standards that I would want to see this organization have as we move forward in any circumstance.

16:22I believe everyone on this council has Thank you.

16:25I will not go into details on that report today due to attorney-client privilege, and some of this report goes beyond the, the conversation that we're having today.

16:37But I just hope that with this additional information, it gives you even more insight and the ability to ask even more informed questions as it relates to the matter that we have at hand.

16:49I appreciate the opportunity.

16:51And I know our team will continue to work with this body to ensure that we're being transparent and delivering exceptional services to this community.

17:00So thank you.

17:03Thank you, Administrator Lee.

17:04And our final introductory comment before we get to each councilor's 10 minutes is from Councilor Green, who is the sponsor of the resolution that set this up.

17:13Thank you, Councilor Kanal.

17:16I just wanted I want to frame this up by saying that oversight is not about gotchas.

17:22It's not about blaming, and it's not about sort of badmouthing any bureau or any given employee.

17:30It's about making sure that we are always fulfilling the public trust.

17:34And so that's the kind of energy that I'm trying to bring to this conversation today.

17:38I appreciated your earlier framing remarks about these kind of community agreements.

17:43I think if we do oversight correctly, we do it often and it's boring and it's uneventful because it's a practice that we have to do to make sure that our constituents know that the City Council is going to do its job, which is a very— which is very explicitly about making sure that we are willing to do oversight to follow up on the legislative prerogatives that we have.

18:11And that's how we've structured this new form of government.

18:12We are not executive.

18:12I think that's a very good point.

18:15We are legislators.

18:16So when we legislate and create laws, there needs to be a way for us to say, did we fulfill on that legislative promise?

18:23So just to set the context here, in the original resolution, we noted that on August 8th of last year, council was notified by then-City Administrator Jordan that due to a $12 million underrun in expected business license tax collections, we should expect as council to take an action to close that deficit in the fall TAO.

18:43And around that same time, then-PhB Director Hysarik informed DCA Oliveira of a previously unbudgeted $12 million.

18:51So that's the same number.

18:53It's the same magnitude in rental services offices funds.

18:58And that money was never included as part of the TAO.

19:00And this is all in the resolution that guides this oversight hearing.

19:05So today I'll be asking questions.

19:08My councilors, fellow councilors will be asking questions to figure out why that money was not part of that TAO.

19:12Thank you.

19:13And to kind of close that loop, we have charter authority and a duty to make sure that when we are not getting timely information as to the financial condition of this city, that we then ask why and we correct that gap there.

19:30So to this end, the oversight resolution that provided this hearing generated some public records.

19:38My team has compiled some of those public records.

19:40We've made it available to all of you so you the same information that I'm going to be referencing during this conversation when I ask my questions.

19:45And again, I can't stress enough that I'm coming into this with good faith.

19:49I'm just trying to ask questions in public and not lead to any consequence or any sort of outcome there.

19:58So that's sort of my opening remarks and context setting.

20:00And would you like me to begin the questioning?

20:04Just one thing I forgot to mention.

20:06I mentioned there were 7 folks here who are available just for the For the public knowledge of that, I want to thank them all for being here in advance.

20:13We have City Administrator Lee, we have CFO Beery, we have CBO Director Levine, DCA Oliveira, Housing Director Bonaccor, Housing Deputy Director Gonzalez, as well as Mayor Wilson.

20:24And I appreciate everyone being here.

20:26And with that, we'll start the clocks.

20:28Feel free to start it off, Councilor Green.

20:31Thank you, Councilor Kanal.

20:34To begin my Questioning DCA Olvera, can you please come to the dais?

20:42Set my stopwatch here.

20:53Can you please introduce yourself?

20:55Donnie Olvera.

20:56Excuse me, Donnie Olvera for the record.

20:58Thank you, Donnie.

20:59My first question is.

21:01On what date were you first made aware of the unbudgeted RSO funds?

21:07Just one second, Councilor.

21:08Sorry for using your time here to get my— Councilor, the first time, to my best recollection, was a one-on-one check-in I had with Director Hisarick where she gave me a heads up that there was some unbudgeted funds, and that would have In either late July or early August.

21:27The exact date of the check-in is off the top of my head, not clear, but it was around late July, early August.

21:33Late July, early August.

21:34And that aligns with the timeline slideshow that came from your office to kind of catalog that as well.

21:43Just noting that for the record.

21:45My second question is on August 27th, and if you're following along, that's page 6 in this packet, Director Hisrich emailed you notification of, like, more formally, of unbudgeted RSO funds along with recommendations for how they could be allocated.

22:03That August 27th email included the following statement.

22:07This expenditure, and I quote, this expenditure plan will need to be approved by council in the fall bump, end quote.

22:13So that is now called the fall TAO.

22:16Why was this money not included in the fall TAO?

22:19Uh, thank you for the question, Councilor.

22:21So, um, to the best of my recollection, the director at the time sent that email.

22:28Um, it was— I believe it was the end of the week.

22:31It was the next week that the TAO was, was due.

22:34There's a timing issue.

22:35And so it just so happened that she went on vacation, um, appropriately well-earned.

22:40Um, so her and I didn't get a chance to actually talk about the memo until after she got back.

22:45And we scheduled time to do it.

22:46So from the day I got the memo, from our ability to actually talk about it, the deadline for the TALP submission had passed.

22:52And at that point, we started doing more evaluation of the information.

22:56And there's a meeting scheduled to do that with her team.

22:58Okay, thank you.

23:00But you did first learn about an approximate level of funds in late July?

23:07Not a particular number at that time, but I was, you know, at that point generally aware of something, you know, Okay, thank you.

23:15And so between the date you were first verbally informed, um, and August 27th when you got the formal written memo, how many conversations did you have about how and when council would be informed of these funds and with whom?

23:29None to my recollection, Councilor.

23:30It was at that point premature.

23:31I hadn't received anything official yet.

23:34Okay, thank you.

23:36Um, my next question is, Was anyone in the administration made aware of these funds prior to the TAO?

23:44If so, who were they, when were they made aware, and why were they made aware?

23:51Well, Councilor, the TAO is a lengthy process, so people are learning in the middle of the TAO process.

23:58So I guess to say who learned before the submission, the first deadline of submission, which I believe was the 5th, Let me look at my dates to be clear.

24:08That's when service areas were— the proposals were due.

24:11I don't believe anybody at that point knew before the submission.

24:15It was during check-ins that I had with the city administrator at the time, Michael Jordan, that again, I gave him pretty high level.

24:22We think there's some funds in the bureau.

24:24We don't have definitive details yet.

24:26We're going to work on that.

24:29Okay.

24:30So I just want to I just want to go back a little bit.

24:32In that August 27th email, there's an identification of $12 million of funds and a spending plan.

24:41And you didn't— so I just want to make sure you weren't talking about that in the context of the TOW after you received that spending plan with anyone else involved in the TOW construction process.

24:53Not to my recollection, Councilor.

24:55Okay.

24:56Thank you.

24:56Thank you.

25:00My next question is, when you briefed the mayor, City Administrator Jordan, and CFO Beery in early September— and this is drawn from a response that I think Cody Bowman provided to a records request from the Mercury in December— is the timeline that you said that you had told the mayor, CA Jordan, and CFO Beery, it was around early September?

25:25And chose not to brief council at that same time, what was your basis for concluding that the city administrator's duty under Section 2-406 was being met?

25:34That is the requirement that the city administrator keep council, quote, at all times fully advised as to the financial condition and needs of the city.

25:42Thank you for the question, Councilor.

25:44At that particular time, again, I hadn't had a chance to talk to Helmi, Director Hisarick, about the memo.

25:52She was on vacation, so it wasn't until she got back that the submission already happened.

25:57It felt premature to share any information because her and I hadn't had a chance.

26:00And in fact, the briefing we set up on September, I think, get the right date, September 18th, with her and her leadership team was to in fact go through the memo for the first time.

26:12So it was at that time that we decided to— that decided that's when we started to unpack the resources, where they were at, et cetera.

26:19And so just from a practicality perspective, I gave the mayor, CFO Berry, and CA Jordan a heads up that there was some discrepancies, but that we were still evaluating the true nature.

26:32There was general, you know, concern about the accuracy at that point, so we wanted to do some more work.

26:39Okay, thank you.

26:44The question— my next question, this might be my last question for now, is council was informed of the existence of this money on November 20th.

26:53That's the same day as, and in fact less than an hour before, the second reading and passage of the TAO.

27:00Who made the decision to inform council on this specific day and why?

27:07So the week prior, And I actually, I don't want to be— I can't be specific on the exact day when we, we started to realize that we had a higher fidelity or detail the number.

27:18At this time it was about 11.7.

27:21Um, the mayor thought it was appropriate at that point.

27:24We felt confident to say, okay, we've confirmed this particular tranche of money.

27:29And so we actually had set up a meeting for the following week to get that scheduled.

27:34Okay.

27:35In between that time of setting that meeting up and the meeting happening is when we learned of the additional $9 million.

27:42So just what happened, just because at that point we knew director, he informed me on the, the day before that meeting happened, it's not $11.7, it's $20 million approximately.

27:53And so when we met on that, that next day, that's when we shared the full amount, which we just learned.

27:59So just, I want to make sure I understand this correctly.

28:01So you shared the full amount with council because you learned That there was an extra $9 million, or because— were you planning to share the $12 million?

28:08We were planning to share the $12 million, and then it just— and then we learned there was more.

28:12Okay.

28:17All right.

28:17So I still don't— I don't— still don't know who made the decision to inform council on that specific date.

28:24Uh, I believe it was the mayor.

28:25I mean, and I'm saying I believe that because the invite came from his, um, calendar.

28:31Okay, thank you.

28:34So I just, from what I'm getting here is, I'm just going to summarize.

28:40So you found out from Helmi Hysrich verbally in late July, early August of the existence of some money that was not budgeted.

28:49There's some uncertainty around what the magnitudes are in the range of $10 to $20 million.

28:56Yes.

28:56So by August 27th, you have an explanation in a formal memo that there is $11.7 million and a spending plan for how to use those, and then a suggestion that to use those in the TAO, councilors would need to be informed.

29:12Mm-hmm.

29:14Okay.

29:16I think, Chair Kanal, I think that's all I have for now.

29:19Thank you, Donny, for answering these questions.

29:21Appreciate it.

29:23Thank you, Councilor Green.

29:24And just to clarify, so you've got a couple minutes left roughly.

29:27We'll get you the exact, so you'll have that available for you later.

29:31For colleagues, you're able to use your time in chunks if you'd like, or all at once.

29:35As I put in the run of show, we're gonna go with the resolution co-sponsors first.

29:39So it'll be Councilor Avalos, then Morillo, and then I'll go in the queue.

29:42So please feel free to get in the queue as you're listening to these 2 colleagues, and I'll pass it over to Councilor Avalos.

29:50Okay, thank you, Chair Kanal.

29:52Uh, let me start my timer here.

29:55Thank you, uh, Councilor Green.

29:56I appreciate the context you were able to bring out in that conversation.

30:00And so I'm going to pick up where you left off and spend a little bit of time walking through the early September briefing of the mayor, the city administrator, and the CFO, and specifically to understand what the city's budget professionals were saying at that moment and how that advice was ultimately handled.

30:15So, um, since I'm not there, well, I can't tell.

30:18Uh, I need Jonas Bieri, please, to come up.

30:22He's on his way up now, Councilor Avalos.

30:25Okay, thank you.

30:27All right, thank you, CFO.

30:31Let's start with this question.

30:33On what date were you first made aware of the unbudgeted RSO funds?

30:39Um, thank you, Councilor.

30:41For the record, uh, Jonas Bieri, City's Chief Financial Officer.

30:46A couple of notes about that question.

30:49First, timing-wise, I'm told via DCA Oliveira that there was a conversation in September prior to the TAO submittal.

31:00I don't specifically recall that conversation.

31:03However, it is very common as that work is being done that there are outstanding questions and things that due diligence that's continuing.

31:11And so that's not, In and of itself unusual that there would be a conversation about something that is evolving.

31:19And so I'm told that that conversation occurred.

31:21I don't have a record of it, but accept that that probably happened.

31:25I believe it was October 5th, Sunday evening.

31:29I was actually on vacation October 2nd through 7th, came back and saw that email in my inbox, which was the first First time that really came to my knowledge.

31:42I'll also note that there was some initial confusion on my part, maybe on the part of others as well, but certainly on my part about where those dollars were, right?

31:53And there was a couple of different amounts that were both close to $12 million.

31:58And so there was some initial confusion on my part about which bucket that was.

32:02So I just want to acknowledge that as well.

32:05All right, thank you.

32:06Um, from our records, it seems to show, um, early September was when you knew, but I'm hearing you say October 5th.

32:14So is that to confirm when you officially knew, early October, not early September?

32:20Uh, yeah, Councilor, I would say October 5th, or when upon returning from vacation on, I think it was October 8th, was the first time that I actually saw something that said— I said, here's something I can hold on to and start actually thinking about again.

32:32I'm told that September conversation occurred.

32:34I don't deny that it occurred.

32:36It just doesn't stick in my memory.

32:37Again, it's very, very common that those kinds of conversations occur with bureau directors and DCAs and other city leadership as that work is being performed to submit information on that deadline.

32:49Got it.

32:50All right, let's keep going.

32:51I'm going to read a statement from an internal city talking points document on the RSO funds.

32:56This is on page 10.

32:57For people who are following, this is a comment regarding the city's claim that the RSO funds were not included in the TAO because of timing.

33:05The comment reads in full, quote, for what it's worth, I think CBO might technically disagree with this, as their recommendation was to put into the TAO.

33:14Um, Donnie and I provided direction to hold off given the continued uncertainty.

33:19So let's start with, is that your comment?

33:22Uh, that would be consistent with my recollection of that comment.

33:25Yes.

33:26All right.

33:27So when did CBO make its recommendation to include the RSO funds in the fall TAO?

33:33Um, that's a good question, Councilor.

33:34I don't know specifically when that was made.

33:36It was a pretty dynamic conversation at that, at that moment.

33:42Okay.

33:43Um, and to whom was that recommendation made and in what form?

33:48Uh, Councilor, I don't, I don't know the answer to that question.

33:50Apologies.

33:51All right.

33:54Wrote that you and DCA Oliveira, quote, provided direction to hold off, end quote.

33:58So can you describe that direction?

34:00When was it given?

34:01In what venue?

34:02And to whom?

34:03Councilor, again, I can't recall that specific conversation, or I don't know that there's any— I don't have any recollection of that specific language being spoken.

34:14I know there was robust dialogue about how to approach it in the fall TAO and significant concern, including from myself about the fidelity and accuracy and validity of the numbers.

34:28And so I'm not surprised that there was discussion about holding off pending that additional due diligence.

34:35Thank you.

34:36So just to be clear what I'm hearing, my question is around your quote that you said you did give, or are you saying that you don't— you are not sure that you gave a direct quote that said quote, Donny and I provided direction to hold off given the continued uncertainty, because that's where my question is coming from.

34:55So I'm wanting to know what is that direction that was given based on what you said.

34:58So are you saying you don't recall saying the original quote or you don't recall the direction that you gave?

35:04Yeah, no, got it.

35:05Thank you for the clarification, Councilor.

35:07I did specifically recommend that we not include it in the fall TAO because I was, I think, rightfully concerned Okay.

35:28Um, let's keep it going.

35:30So I want to ask about another comment on that same document, page 10, and it reads, quote, noting that on October 9th it was communicated to me that these dollars might be either committed to an existing project or used for a new project.

35:43Okay.

35:43And/or deployed in December 2025 NOFA, which was a reason that we did not include initially in the TAO.

35:49I don't think we need to reference that here, but want to make sure this statement isn't inconsistent with other potential public records, end quote.

35:57So is this your comment?

35:59That sounds consistent with an email that I sent.

36:01Okay, who communicated that to you on October 9th?

36:05Oh my gosh, I don't, I don't know that, Councilor, and I apologize.

36:07I don't have that detail handy in front of me.

36:11Okay.

36:11And on what basis did you understand the funds to be committed?

36:16I'm sure that would have been based upon a conversation with Housing Bureau, with DCA Oliveira.

36:21And again, I think I want to be cautious and provide a reminder to folks that I, at that time, also had some confusion about the buckets of money.

36:33So I want to be just transparent about the fact that in that communication, I may have been thinking about a different bucket of money.

36:41Commitment of those dollars that was not consistent with the legal obligations around the RSO fund.

36:48Okay.

36:49But did you independently verify that representation before relying on it?

36:53I had not completed that work in advance of the fall TAO, which is another reason why I was very concerned about the information being submitted before we had the opportunity to do that due diligence.

37:05Okay.

37:06So Director Easterick's October 13th memo, which is on page 7, proposed using the same dollars on new rent subsidies, home sharing, legal defense, and returning $2.7 million to the general fund.

37:17None of those were existing commitments or scheduled NOFAs.

37:20Is that correct?

37:21And were you made aware of that October 13th memo?

37:25Um, Councilor, I don't believe I saw that formal memo at that time.

37:30I was provided that memo shortly after that discussion, I believe.

37:34And were you aware that PHB was referring to these funds as uncommitted or unavailable for allocation and actively proposing allocation options?

37:43Um, I'm sorry, can it cut out?

37:46Can I just repeat the question, please, to make sure I understand?

37:49Yeah.

37:49So were you aware that PHB was referring to these funds as uncommitted or unavailable for allocation and were also actively proposing allocation options?

37:58Were you aware that that was going on in the background?

38:00Uh, I was not necessarily aware, um, of that.

38:03And again, I'm— the timeline is I will say I was under the belief that, as many were, that those funds would have been budgeted and accounted for in the budget at that time.

38:21I only have a minute and a half.

38:24So the recommendations originally sent to DCA Oliveira on August 27th were subsequently revised on October 13th to include $2.5 million in emergency relief.

38:32$2.75 Million returned to the general fund.

38:34This is on page 7.

38:35So were you part of the efforts to help close the TAO deficit with these unbudgeted RSO funds?

38:42Councilor, thank you.

38:43I don't believe I was involved in that.

38:46The memo was produced without my participation.

38:50I know there was an effort at that time to identify all possible solutions to help solve for that known gap.

38:57So I know there had been broad efforts to I have one last question for Ruth, if you could come up, please.

39:11Thank you, Janice.

39:19Hi, Ruth.

39:20So, uh, well, I guess Director Levine, apologies.

39:23Um, so cited comments in internal city documents indicating that CBO recommended the RSO funds be included in the fall TAO.

39:30So can you confirm that that is accurate?

39:34Yeah, Ruth Levine, CBO Director.

39:36For the record, yes, that's accurate.

39:38I did recommend that.

39:40Do you know when that recommendation was made and in what form?

39:45I think the first time was probably via— there was an email thread that Jonas was referring to in early October, between about October 5th and October 9th or so, where we were discussing unbudgeted funds in housing.

39:59And I said, I thought I said at one point that I thought it should be included in the fall TAO.

40:07Okay, my last question is, to your knowledge, was council informed that CBO had recommended inclusion and that that recommendation was overridden?

40:18Not to my knowledge, but I'm not involved in all the conversations.

40:22Sounds good.

40:22Well, that is your time.

40:23Thank you.

40:25Thank you, Councilor Avalos.

40:27We'll go to Councilor Murillo and then whoever gets in the queue first, I guess.

40:31Thank you, Chair Kanal.

40:35Thanks everyone for being here today.

40:36I think it's important to bring this transparency forward, even if it is a bit unusual for our new form of government and we're practicing doing this for the first time.

40:46I believe my line of questioning is for DCA Oliveira.

40:50If you could come back up, please.

40:51Thank you.

40:55And there's going to be a game of musical chairs here, I think, a little.

40:58So maybe as you start your time, councilors, if you could just let us know.

41:00If you wanna make an intro comment, it might be helpful to say who you'd like to come up while we're doing it, and I won't charge you time for what I just said.

41:06Okay, thank you.

41:07And if you could give me maybe a 5-minute time check, that'd be great.

41:09Sure.

41:11So CFO Beery indicated that on October 9th, he was informed of the RSO funds that, quote, might either be committed to an existing project and/or deployed in the December 2025 NOFA, quote, end quote.

41:25And this may have been the reason the funds were not in the fall TAO.

41:29Though there is some lack of clarity on whether this refers to the RSO funds.

41:33Was it you who communicated this to CFO Beery?

41:36Councilor, I don't recall that specific conversation.

41:39At that point, I was focused on unpacking the RSO number.

41:46Okay.

41:47Do you know who communicated this to CFO Beery?

41:50I don't, Councilor.

41:54I do refer to the memo.

41:55For clarity, I do recall there was some confusion about 2 distinct tranches of resources in the Bureau being solved for.

42:03But in this particular instance, I don't know where the information was coming from, one bucket versus the RSO dollars.

42:10Okay.

42:11Were you aware at the time that CFO Beery had been told the funds were committed?

42:16I'm not— I don't want to speculate on what the CFO knew at when.

42:22Okay.

42:23At any point during— between October 9th and November 20th, did you correct that understanding with CFO Beery or think to notify City Council?

42:32Thank you for the question on this particular case.

42:35By the time we got to like November, I would say there was clarity that we were talking about— when we spoke about the $11.7 million at the time, we were talking about RSO dollars.

42:45When that clarity happened for him, I'll allow him to speak to that.

42:50When it came to the appropriate time to communicate to council, by mid-September, after the meeting that I had with staff, I was very concerned about the accuracy of the information.

43:02I wanted more information.

43:03I wanted to understand various elements, the use, the— there's a series of questions I was just asking for more information on.

43:12And that also was part of this question of like, what's actually going on with these dollars?

43:17And so, and I will acknowledge this at this point too, there was probably a communication necessary to say, hey, we found something, some discrepancy.

43:26We don't have enough detail to share, but there is some concern here in this particular fund.

43:33Okay.

43:33I acknowledge that.

43:35So we were still at that time unpacking the accuracy of the information though.

43:39Okay.

43:40So to go through the timeline, and we submitted this online so folks can see it online and it's being shared on the screen right now.

43:46Sometime between late July and mid-August, you are verbally informed of the unspent funds.

43:51You can see that in pages 4 to 5 of the packet.

43:54On August 27th, Director Hisarich emails you a written proposal for spending the $12 million with a clear statement that from PHB that, quote, this expenditure plan will need to be approved by council in the fall bump, aka the TAO as it's called now.

44:11And that's on page 6.

44:12For folks who want the quotes.

44:14In early September, you inform Mayor Wilson, CA Jordan, and CFO Buri of approximately $12 million.

44:21That's page 8.

44:22On September 19th, you told Hisarich that the, quote, ship had sailed on including the money in the TAO and told her not to inform Councilor Zimmerman of the funds.

44:32On October 13th, Hisarich delivers the final revised expenditure memo after integrating comments and ideas from you in several instances that go back Thank you.

44:44On October 20th, the Finance Committee takes up the fall TAO.

44:47On October 30th, Hisarich is placed on leave.

44:50She's told she has until November 20th to accept the severance package.

44:55That's on page 12.

44:56And on November 12th, council hears the first reading of the fall TAO.

45:01So by my count, over those 3 months, the executive branch took roughly a dozen distinct actions on these funds.

45:11Drafting a proposal, revising it, briefing the mayor, briefing the city administrator, briefing the CFO, deciding to override the city budget office on including this in the TAO and instructing that a councilor not be told, removing the PHB director, and at none of those moments was council informed about the RSO funds.

45:34I want to walk through what happened in the next 7 days beginning the day after the first reading of the TAO.

45:39November 13th, BPS Communications Manager Elliot Kozik informed you that the city was, quote, about to release records to OPB, including, quote, a few not yet public items, among them the October 13th PHB memo that can be found on page 13.

45:57From November 14th through 16th, you forwarded the October 13th memo to the mayor and his chief of staff.

46:03The mayor then directed Portland Solutions Director Brocker Knapp to develop a different set of recommendations for the money.

46:10Those were developed over the weekend of November 15th through 16th and delivered that Monday, the 17th, and you can find those on page 14 through 15.

46:20November 17th through 18th, the new Portland Solutions recommendations were exchanged between the mayor, you, and interim PHB Director Bonacore.

46:29With you telling Bonaccor that if he sees any concerns, quote, I need to know today.

46:34That's on page 14 and 15.

46:36November 20th, council adopted the fall TAO, and that same day you notified the council of the full $21 million.

46:46So there are roughly 90 to 100 days between the Portland Housing Bureau Director Hrycerich informing you of the money and your November 20th notification to council.

46:58Which happened to be the same day as the TAO was passed and the deadline for Hisarich to accept her severance package.

47:04What prompted you to inform council on November 20th specifically?

47:09Was it the TAO adoption, Director Hisarich's severance deadline, the revelation that council would soon be made aware of the funds via an imminent public domains release, or was it all 3?

47:21Uh, A lot to unpack there.

47:25Let me think about that for a second.

47:26Uh, there was no correlation between, uh, Director Hissrich's, um, status and the, and the information communicated.

47:35As I shared, the, the scheduling of the meeting happened the week before.

47:41That was the time that was scheduled.

47:43Um, as far as the communication around the why of then, it was when we We started to have more confidence in the number that we were working with, that it was in RSO, it was this use of funds, and this was— this is what it was about.

48:00Um, and I'm sorry, the third, the third thing was the timing of the TAO.

48:06The TAO was happening parallel to this, and I would just offer that in this particular setting, the dollars being there was important, and, and our ability to use even the spring TAO to make the adjustment, as you all did, Okay, thank you.

48:30In the final 7 days of a 4-month window, the mayor's office developed a new allocation proposal, briefed an interim director, and informed council, all in the 7 days after the records release was flagged.

48:42In my count, the mayor's office did not receive any additional information That is more urgency on these funds in a week than in the preceding 100 days.

48:50Had the public records release not been imminent on November 13th, on what specific date would City Council have been informed of the $21 million in the RSO funding as is required by charter?

49:07I'm sorry, can you repeat that, the question part?

49:09I got the first part.

49:12Yes.

49:13On what day were you planning on telling council about the $21 million in RSO funding, given that the administrative body was moving faster than they ever had in the 90 days, 90 to 100 days that we had been informed of it?

49:29Thank you for the question.

49:30I think the timing was consistent with where we were at in the process of a lot of things that were happening at the Housing Bureau at the time.

49:39October was very difficult for the Bureau.

49:43There was a lot going on, and I would say that there was a— we were also in the middle of a very, you know, dynamic TAO.

49:51The timing of that also coincided with us having a complete picture of the resources, almost serendipitously in this particular case.

49:59But again, the part that I acknowledge is that some And some communication to council in September or October, whenever we felt like more clear what was happening was appropriate.

50:13But I stand by the reality that our confidence in the number until we shared it was quite low.

50:21And the timing reflected our higher confidence that when we shared the information, it was accurate.

50:29Okay.

50:29I'm getting close to the end of my time here.

50:32Did anyone instruct you to wait until November 20th before informing council?

50:38Not to my recollection, Councilor Nowakowski.

50:43So between September when you decided the TAO was not the vehicle for sharing these RSO funds and November 13th when the records request surfaced, a period of roughly 8 weeks or 2 months, was any council briefing on the RSO funds scheduled, placed on the calendar, or committed to in writing?

51:01Because I can't help but wonder, looking at all of this timeline, If it weren't for the October 13th memo being surfaced in the OPB records request, would council have ever been informed of these dollars?

51:14Oh yeah, council would have been informed, absolutely, Councilor, once we had the, the confidence in the numbers.

51:20Absolutely.

51:20And that's time.

51:22Thanks, Councilor Murillo.

51:23Thank you, Councilor Kanal.

51:25And of course, everyone will have a chance to come back around when the queue is exhausted, but at this moment, there's actually nobody in the queue.

51:31Um, so if anyone would like to get into the queue and take their first crack at their 10 minutes, I'd welcome it.

51:39And if those who have already gone would like to come back in, you can also put yourself in the queue.

51:43I'll just call on those who haven't gone already.

51:53Councilor Zimmerman.

51:54Thank you.

52:05The first person I'd like to talk to is, uh, Donnie Oliveira.

52:09My next one will be for CA Lee.

52:13Donnie, is it true that your understanding is that the former director of the Housing Bureau was aware of accumulating budget I'm aware of that information now, Councilor.

52:35Great.

52:37Mr. Lee, same question.

52:41Same response.

52:41I'm aware of it now as I sent out the $106 million memo.

52:47So I just want to clarify that both of you are aware now that we have since learned it sounds like that The former director of the Housing Bureau was aware of accumulating funds that were not budgeted in the normal process as early as January of 2025.

53:02Thanks, that's all.

53:05Thank you, Councilor Zimmerman.

53:10Once again, there's, uh— oh, sorry, I didn't see it.

53:13Councilor Pirtle-Guiney.

53:16Thank you, Chair.

53:20You know, much of the work that is done in spaces like this is subjective, and I'm wondering, City Administrator Lee, if you can share with us a little bit of information about your perspective on how, let's say, baked something should be when you bring it to council.

53:40There's a, a bit of a push and pull here around making sure that council has good information And I will acknowledge we have not always been our most polite body when we get information and it changes.

53:56And I understand that there may be some fear of bringing us information before it's baked.

54:01And I'm also hearing from my colleagues and have heard about this topic before that there's frustration when we don't get something in time.

54:10So what should we expect?

54:13With you as city administrator in terms of how baked something is when we hear about it, and on the flip side, how long that means we wait before we hear about it?

54:25I think coming into this role and something that I've communicated to this body as a whole is, as I'm aware of situations that may have impact to this body and the decisions that you'll be making, Try to at least make you aware of the situation with the caveat to that as a whole, that these numbers may change, or this information is as of the information I have as of today, and that information is subject to change.

54:55Just being a professional regarding it, this situation varies for different people as it relates to when you communicate something, ensuring that the information that you're communicating is accurate.

55:08Because you don't want to backpedal from that information at a later date and say, well, sorry, I made a mistake.

55:15This is the information I have now.

55:17I think that direction has to come from this body as a whole as how they want to receive information.

55:23And I think one of the things that this council has communicated to me coming new into this role, you'd rather know now about information as I receive information.

55:34But to also be open to be able to come back to you and you would be open to saying, hey, this information has changed.

55:43You know, in any situation like this, a situation where a number is being fluid and it's going to have community impact as well, you want to make sure that information is accurate as it relates to the information that you're giving to council that may become public record.

56:02So as you go through situations like this, it's, it's one of those situations where you're damned if you do, you're damned if you don't situation because you're caught in between a tight situation of, hey, this is important information.

56:21Council should be aware of this information, but I'm unsure of the accuracy of that information.

56:28And in any situation, you know, how we move forward in a situation like this is making sure that council is at least aware of the situation.

56:40We may not provide exact numbers because we're unsure of those exact numbers, but at least making council aware of the situation and the challenge that we're faced with, but also providing council a timeframe of when we anticipate being able to answer that question.

56:56And I think that goes to your later— latter question of when should we We expect to have that information.

57:02And I think that's going to be a give and take type of situation, keeping open lines of communication with council as it relates to the matter at hand, but also letting council know where we are with getting them the most accurate information in a timely fashion as possible.

57:19And that's what we're challenged with.

57:20That's what we're charged with doing.

57:22That's the accountability that we're holding ourselves to in this situation.

57:25Thank you.

57:28Thank you.

57:30Thank you, Councilor Pirtle-Guiney.

57:32I see Councilor Smith in the queue, and then if there's no one else, we'll go back to Councilor Green.

57:36Councilor Smith.

57:39Thank you, Mr.

57:40Chair.

57:42I have a couple of questions that I want to make sure that I get on the record because I just got some new information.

57:49Could I have CFO Berry and, um, CBO Director, uh, Levine, come up please.

58:07Good morning.

58:10Good morning, Councilor.

58:11Thank you.

58:13And actually, I need, um, DCA Oliveira up as well because I'm going to be, um, Speaking from the email exchange that we had last night, while the general explanation for how the funds that created the TAL was, was given, there was, uh, very little specific information.

58:45And The housing, um, the housing fund dollars that, that I'm talking about, it wasn't clear exactly, and it amounted to $23,991,643 was in the TAL that was in the, uh, housing bond money.

59:10Are you familiar with that?

59:11CFO Berry.

59:15Councilor, I'm trying to— thank you.

59:17I'm trying to track that number.

59:19Are you talking about the amount that was in this most recent spring tell?

59:23Exactly, the one that we voted on last week Wednesday.

59:27And I was asking about those funds because I wanted to identify— that was a part of the bigger fund that the RSOs and all of the that we're talking about today.

59:40And I was told that if we tried to appropriate any of those funds, that it would cause us to be in some sort of financial straits because they had contracts out.

59:55And I was concerned, DCA Oliveira, that when I was told that there were contracts out, I didn't understand how the contracts are out Well, since we had not appropriated the money and since the money was hidden and we just found out about the money, so how could it be for a particular project?

1:00:15So then I tried to go over in my mind what that could look like.

1:00:18So they could have easily been for other projects, but you wanted to use these particular dollars since they were available, or had they always been identified as the source even though they were not Budgeted, even though they hadn't been budgeted for years, um, according to, to Director Bonacar.

1:00:43So I, I'm going somewhere with this.

1:00:46And your response yesterday was, was interesting because you sent me back an Excel spreadsheet.

1:00:53I asked you, tell me how much is owed for each project.

1:00:59Yes.

1:00:59Send me the contracts, as I was told that I would get contracts, but I didn't get contracts.

1:01:06I got links to projects, and many of these projects were like 4 years old, 2 years old, 3 years old.

1:01:15So again, I'm new to the City Council.

1:01:18I don't know how we pay our bills, but I do know that we didn't pay our bill to prosper last year, and I, I was wondering if this is a pattern in practice That our budget office practices where we hold on to money and wait to deliver, or I don't know, because as a small business person, I could not wait to pay an invoice for 4 years and then come back and say, oh, we were going to use that money for this project.

1:01:48So can you explain to me how we can appropriate funds when it was never authorized?

1:01:55Thank you for the question, Councilor.

1:02:00I just will note for the public and for Council, we're referring to 4 housing bond projects: Alder 9, the Auroras, Crescent Court, and Hollywood Hub.

1:02:10What Councilor Smith is asking is there was $23 million in housing bond resources.

1:02:17Trust fund.

1:02:18I'm sorry?

1:02:19It's the trust fund, right?

1:02:20Correct.

1:02:21It's their housing— it's the housing— the housing bond dollars.

1:02:24Yes.

1:02:24That's what those are.

1:02:25And those dollars were confirmed by ordinance by council in various years going, going back about 6 or 7 years.

1:02:34So council authorizes the bureau to use housing bond dollars specific to those projects.

1:02:403 Of those 4 projects that I shared with the councilor are already built and have people living in them.

1:02:45The 4th is the Hollywood Hub project, which you've all seen as you drive down So the $23 million remaining are all going to those projects.

1:02:56And you might ask, to your question, Councilor, how could we possibly be spending dollars from the housing bond still on projects that people are already living in?

1:03:04Great question.

1:03:05So it's pretty standard in affordable housing deals.

1:03:10Funders, in this case the City of Portland, are continuing to make disbursements to projects even after they're open.

1:03:16So the $23 million And is going to the projects that are already open?

1:03:16There's a variety of reasons.

1:03:17There's developer fee installments for the nonprofits, there's conversion costs, there's occupancy stabilization, especially for permanent supportive housing like many of these are.

1:03:26We're truing up the cost of the project.

1:03:29So for the 3 of the 4, those disbursements projects were— disbursement payments that are happening right now are truing up the end of the projects, our commitment by ordinance from housing bond dollars to those.

1:03:40The 4th project, which has The only one that has about $7.7 million remaining in disbursement is for the Hollywood Hub, which is still being built.

1:03:47So you can imagine we'll make those payments once that project is in completion.

1:03:51So, Councilor, to answer your question, it's not that we have new contracts that this year— the remaining $23 million is what's owed to those projects as committed by council, in this case your predecessors.

1:04:04And if we pay for those projects, they don't necessarily have to come out of this pot of money.

1:04:08They could come out of general fund.

1:04:10They could come out of any other CDBG fund that you have.

1:04:13They don't have to specifically come out of this pot, correct?

1:04:18There are scenarios where we could replace resources.

1:04:22I would caveat that housing bond dollars have specific restrictions.

1:04:27So if you do that, you'd still have to honor the intent of the bond dollars with a new project.

1:04:32In this particular case, because these projects have already— 3 of the 4 are already built, To try to do budget machinations now would probably not be best practice.

1:04:46It's possible, but those bond dollars were very explicitly allocated to those projects.

1:04:51Thank you.

1:04:52That was a very good explanation.

1:04:54So here comes my last question.

1:04:56I'm looking at the $7.7 million.

1:05:00It's supposed to be disbursed during fiscal year '26-'27.

1:05:05And since our '26-'27 budget has not been approved, this $7.7 million can be spent other places as well because it is not appropriated or contracted out.

1:05:17And you would actually— if we did appropriate those $7.7 million, you would have to find another place to fund that last installment, correct?

1:05:29Because they're not— you can't appropriate this yet.

1:05:31It says So it's actually a balance in that account, looking at your spreadsheet.

1:05:39Thank you for the question, Councilor.

1:05:41It's a balance, but the target is due to the project.

1:05:44So if we took those dollars out from the housing bond resources and reappropriated it somewhere else, we would now have a hole for that project that would have to be—.

1:05:53You would just take it from a different pot.

1:05:55You could take it from CDBG, you could take it from general fund, you could take it from other funds.

1:05:57Fund.

1:05:58You could take it from other places, and in fact, you could actually take it from the reserve fund.

1:06:06Councilor, then you can pause the timer.

1:06:07I just want to understand how this relates to the $20.7 million.

1:06:10Um, this is a part of the $20— this is a— this— it expanded from $20 to $40 to $106 to $145.

1:06:18This is a part of that whole money that was hidden.

1:06:21Um, so the question is If I wanted to appropriate the $2.2 million that I requested, it could actually come out of here because it didn't get appropriated for '25-'26.

1:06:35You have it on your balance sheet as being disbursed during '26-'27, and you have a balance.

1:06:43So there's a balance there.

1:06:44I just want to just recognize that you have a balance in that account.

1:06:48There is a balance, Councilor, and I would definitely want to work with city attorneys and staff to get back on the, you know, with high confidence that we can use those monies as you might intend.

1:06:58Thank you.

1:06:58So I just wanted to make sure because I was told there was no balance last week, but today when I asked for the question, you responded, and now, now there's a balance in that account.

1:07:06I appreciate you getting me that information.

1:07:08That's why I sent it to you last night, because I wanted to take a look at it, uh, and I wanted to make sure.

1:07:14And the reason why I'm asking, um, Ruth and Jonas to come up, because is that Is that a pattern and a practice for us to have balances but actually say that all the money has been appropriated?

1:07:29Is— do we normally do that?

1:07:35I'm not fully tracking what the balance is, having just seen it in my inbox this morning.

1:07:41But I will say, as a general matter, the way fund balances work is that when you have a restricted fund, anything that is unspent at the end of the fiscal year becomes a part of ending fund balance.

1:07:55That is just how the ACFR is built.

1:07:58That's how— that's true in all governments.

1:08:01And it can be appropriated in the next fiscal year as beginning fund balance.

1:08:08And so as a general matter, we, you know, appropriate how much we expect to have in that fiscal year, and anything that is unspent Ought to move to the next fiscal year.

1:08:24We do project how much we expect to have in the next fiscal year, and we can budget that as budgeted beginning fund balance in the next fiscal year.

1:08:33And that is a projection that ought to be then trued up once we have the actual ending fund balance.

1:08:38But that's a general description of how it works.

1:08:41And last question, Ruth.

1:08:42Can council appropriate that balance before the end of the year?

1:08:47The fiscal year is over to a project for '25-'26?

1:08:57I guess I think I'm tracking the question is if you expect there to be unspent dollars in the current fiscal year, can you appropriate—.

1:09:06No, no, no.

1:09:06Right now, if we put an ordinance in, there's a balance in that account.

1:09:10It says it's $8.2 million.

1:09:13We do an ordinance next week to take some of those dollars from that account.

1:09:20There's a balance there.

1:09:21Again, assuming that it's legally, um, that it's compliant legally with the intended uses of the restricted fund.

1:09:28Thank you.

1:09:28That's what I wanted to find out.

1:09:29Thank you.

1:09:30Thank you, Councilor.

1:09:30So we let that go just a little over, but thanks for, uh, answering the question there.

1:09:35Um, next in the queue is Councilor Green, followed by Councilor Zimmerman.

1:09:38I'll also just note really quick that the first stopping point we have after about 10:45, we're going to take a short break.

1:09:45Councilor Green, you have about a minute and a half left.

1:09:49Thank you.

1:09:50DC Oliveira, my question— my follow-up question is for you.

1:09:53Thank you.

1:09:56You indicated that the decision was made by the mayor to inform council once the precise number, $11,750,000, was known with some confidence.

1:10:07That decision was made about a week prior to informing council on November 20th.

1:10:11I believe so, Councilor.

1:10:14I think that's accurate.

1:10:16Thank you.

1:10:17This number, $11,750,000, is the same number that was in Director Hystrich's August 27th memo, and it's the same number that was in the October 13th memo and in your email to Council on November 20th.

1:10:32So this number did not change over those iterations.

1:10:36What did change was the internal recommendations for how to spend that money.

1:10:38To spend that money developed by Portland Solutions over a weekend at the mayor's direction.

1:10:45Did you instruct at any time before that, did you instruct Director Hissrich to identify a way to close the TOW deficit with the RSO money?

1:10:54Councilor, there was definitely a— we had a— there was 2 conversations that were happening in parallel.

1:10:59There was a broader conversation we were having as a city more broadly.

1:11:02So I'll just specific to my service area.

1:11:05Thank you.

1:11:06As we were evaluating ways to reduce spending, either hiring freezes, reduction in EMS spending, etc., right?

1:11:13So we were looking at that.

1:11:15So there's a conversation about how to reduce as a service area, do our part to close that gap.

1:11:21Thank you.

1:11:21As we were evaluating those potential RSO dollars, after we had the September 18th meeting, I asked the teams like what was legally in bounds with RSO.

1:11:34And so they contemplated a variety of things and the director did contribute a recommendation for sort of a general return to general fund as an option.

1:11:43And that's what I see.

1:11:44That's what I see in the October 13th communication.

1:11:46It says per our— per instructions, here's a revised plan for general fund return X, Y, and Z.

1:11:51Yeah.

1:11:51Thank you.

1:11:52Any councilor?

1:11:53Yeah.

1:11:53Okay.

1:11:53Okay.

1:11:53Sorry, I was gonna, 'cause I—.

1:11:56Councilor Zimmerman.

1:11:58Yeah, if we could have the finance staff please come up, budget staff.

1:12:00Thank you.

1:12:01So, um, you know, in theory, right, council can appropriate funds to be executed in a given year, but we also appropriate reserve funds.

1:12:16I'm getting a nod from our budget director, so that statement makes me confirm my entire career, which is we must be aware of all All funds within a— all money within a fund in order to make those determinations.

1:12:30Again, I'm getting a nod.

1:12:32So if we have a fund balance and we both want to appropriate funds as well as establish a reserve for that same fund balance, does council need to be made aware of the entire fund or just those that are intended for appropriations?

1:12:50Thank you, Councilor, who asked the question.

1:12:52It is, Council should be, and I believe with maybe one rare exception that we've been discussing for the last few months, made aware of that.

1:13:03Those fund balances are appropriated in the budget.

1:13:06Often there's a line called contingency, which is that amount.

1:13:10Great, thank you.

1:13:12I appreciate that.

1:13:17I'm wondering if, in your best estimation, why Director Hissrich, the former director of Portland Housing Bureau, why she made a recommendation for the $12 million to be executed, the appropriated part, but didn't feel it necessary to inform us about The remaining $9 million that her staff had made her aware of, meaning they were attempting to establish a reserve, which is a well-meaning and very common government practice.

1:13:53But would council be able to make such a determination about the right size of appropriating funds for execution and the appropriation— appropriate size for a reserve if we don't know about what is being recommended in a reserve if we are not made aware of that entire fund.

1:14:11Do you have a best estimation for why she approached this decision package that way?

1:14:16Councilor, I can't speculate on that.

1:14:19Okay.

1:14:33Is there a memo that you're aware of from the Housing Bureau that prior to November or prior to October discussed the entire $21 million?

1:14:48Because I'm only aware of a memo that discussed the $12 million.

1:14:55Yeah, Councilor, thank you for that.

1:14:56I am not aware of a communication.

1:15:00I'm trying to think back There's been some information that's come to light over the last few weeks that occurred prior to my knowledge.

1:15:07I certainly wasn't aware of anything prior to that October date that we previously discussed.

1:15:11Ruth, as the budget director, if you had an office, a department, anybody that came to you and they said, we want to execute this much funds, but they never told you about the stuff they wanted to keep in reserve, how would that make you feel as the budget director?

1:15:29Um, I can just say I would recommend that they budget the full amount, which is what I did.

1:15:35And that's because that's the legal practice in Oregon, is that you have to identify— even if you're not going to touch it in that year, you have to identify all funds that exist in your bank account, to use more lay terms here?

1:15:45Correct.

1:15:46Okay, so to your best knowledge though, you don't have a reason, a A, um, even if we disagree with it, but a thoughtful, like, this is why we only were told in the summer months about $12 million instead of $21 million.

1:16:05Nothing has surfaced in terms of the why behind that other than it just didn't happen.

1:16:12Either one of you?

1:16:13Yeah.

1:16:14Okay, I appreciate it.

1:16:16Um, you know, this, uh, this has been challenging in terms of— I, I really appreciate the questions about We talked about due diligence and having good facts before we go.

1:16:26And I am hearing, I think, through all of these conversations today from multiple staff who've come up— thank you— just about how non-in-whatever confident we were in those initial numbers in those fall months, meaning there was something else going on at the Portland Housing Bureau before you felt confident enough to bring us the whole number.

1:16:48So thanks again for both coming up.

1:16:51That's all, Chair.

1:16:54Thank you, Councilor Zimmerman.

1:16:55Next in the queue is Dunphy, then we'll take the break.

1:16:58Thanks.

1:16:58Thank you.

1:17:01Oh, Jonas and Ruth, please come back.

1:17:03Sorry.

1:17:03Thank you.

1:17:04You know, colleagues, when I read this, when I've read through these documents and I'm hearing what we're hearing today, I can see that there are many layers of people choosing to manage information about these dollars.

1:17:15The Housing Bureau, Thank you.

1:17:16I have a question for the CFO.

1:17:16Trying to come up with a plan for the dollars before publicly discussing them, the DCAs and the CFO managing the information about general fund eligible parts of these dollars prior to the TAO and the confusion of what dollars can, you know, the color of money questions.

1:17:31It seems possible that a public records request triggered the release of this information to council at the awkward time that it did and that the Housing Committee tried to process these dollars into a plan before the information got exposed.

1:17:44Yeah.

1:17:45—Pants on and started running, which is of course what happened when we then also started having different councilors introducing ordinances to spend this money differently.

1:17:55You know, just a quick aside, on my second week as council president, one of my staff learned that the amount that the unbudgeted dollars was potentially 5 times larger than we had learned.

1:18:06We had heard that there might be more found, but I was not truly prepared for that magnitude.

1:18:11And so So my staffer immediately called me.

1:18:13We got on the phone with the city administrator.

1:18:17Legislation on the housing dollars was already pending.

1:18:20And I decided that at that moment, even with incomplete information, I had a responsibility to let my colleagues on the city council know.

1:18:28So I called everybody personally over that weekend to say what we did know, what we didn't, and to ask everyone to please be very careful and responsible until we knew more.

1:18:39And that information immediately was leaked to the press with substantial inaccuracies and So I understand the impulse to control the narrative around these things or to wait until you have more information, until you have a plan.

1:18:52But I still think that being direct and upfront is obviously always the right way to go.

1:18:57We have to give each other the opportunity to work in good faith with each other, even if we disagree, in order for that to be possible.

1:19:04So whatever else is true to the two of you, it is obvious that there are structural problems with independent budgeting in What has your team changed in terms of what Portland Housing Bureau's budgeting practices are as a result of this process?

1:19:21Yeah, thank you, Councilor, for the question and the observation.

1:19:28Couple of thoughts in response to that.

1:19:32As we've talked in this room multiple times over the last 18 almost months, this organization is undergoing a fundamental structural change.

1:19:42And that's very, very, very messy to unwind decades of legacy practices.

1:19:47So that's the first note that I will make.

1:19:50Again, that work continues and will continue for many, many months.

1:19:54It'll continue to be messy.

1:19:56Even if we were perfect, it would be messy.

1:19:59So that's true and will remain true.

1:20:01The second observation is, yes, this has been an important moment to highlight some of those deficiencies and reinforce And so some of the things we now do are updating the budget manual, for example, to be really clear to practitioners that this is a step that needs to be taken to do this clear identification of reserves and contingencies.

1:20:24As council's experiencing right now in real time, we're trying to improve the budget communication in a way that is more transparent and clear to you and to the public.

1:20:33And we're realigning the organization to have a little clearer lines of reporting to the City Budget Office and to myself.

1:20:40Lastly, as we've said before, we do not have human capacity to catch council expectations.

1:20:47And so we will continue, I predict, to see these kind of anomalies for the long term until we get serious about investing in that administrative infrastructure at the city.

1:20:58Thank you.

1:20:58Thank you very much.

1:21:02As that process is working to to right-size our system in this new form of government.

1:21:10Is there a unified budgeting process and methodology across all bureaus that we're going to be working to implement?

1:21:17Yes, thanks for the question, Councilor.

1:21:19Yeah, I mean, it's a multi-year effort for sure.

1:21:22We've already, as Jonas mentioned, made some structural changes to collaborate much more closely with the finance managers budget folks out in each of the service areas and trying to use a sort of service area model so that information can flow more effectively to all of the analysts in the various bureaus who prepare the budgets.

1:21:46But, and, you know, working on communicating all of that again through the budget manual, through trainings, and communicate the, you know, changing expectations of this council compared to the last form of government in terms of how budget information is prepared.

1:22:05You know, I think this change around how we budget fund balances and contingencies and reserves is one example of that, but there are plenty of others that we're changing to try to meet the expectations of this body.

1:22:19And so there's very much one way to go through the budget.

1:22:26I think it's just a matter of of getting everybody up to speed.

1:22:30And as things have been changing, you know, obviously charter reform and getting everybody in the positions, it's been challenging to get everybody to have a consistency so that people know what the practices are.

1:22:46And then we can roll out trainings to ensure that every single budget analyst in the city is aware of all those practices.

1:22:52So we're on that path.

1:22:54I think it's gonna take another few years, honestly, to fully get us there.

1:22:58And the human capacity So sort of building on what you said, you know, as we are also now going through the budget process, my team has been digging into the line items on the budget.

1:23:10And, you know, I have repeatedly seen situations where we have a question for CBO staff, CBO staff says, that's a great question, let me go back to the bureaus, get an answer, and report back.

1:23:20So a lot of times it's obvious that your team does not have direct access to be able to even and see what is happening within the bureaus.

1:23:28Right now, across the city, how deep into the program level does CBO have the ability to see?

1:23:37Yeah, I mean, we have access to all of the budget data and all of the, like, actual expenditures in SAP and the personnel in the entire city.

1:23:49Where we often have to turn to the bureaus to ask questions is, like, what does this mean for a program?

1:23:57I think some of the things that councilors ask about often is tied to like, well, what is this program?

1:24:05And one of the things that I've talked about in other council meetings is trying to do program offer budgeting more fully.

1:24:12And there was a resolution passed for parks with the intention to roll it out more fully.

1:24:16That is a path that I think will help to be able to describe that.

1:24:20But right now, that's not, I would say, like we don't do that practically.

1:24:24Okay.

1:24:25100% Across all bureaus.

1:24:26So I think that's one other thing that will help.

1:24:29But a lot of it comes down to either what's the intention or what are the impacts operationally, or like specifically what do you do with this exact dollar?

1:24:37'Cause just 'cause it's in a GL account for contracting, I don't know what the contract is for.

1:24:43I can pull the contractor's name, but that's it.

1:24:45So that's where we often have to go to the bureaus.

1:24:48You know, I worked in the old form of government, I'm working in this new one.

1:24:52The old form of government didn't work.

1:24:53Thank you.

1:24:53The voters were right to get rid of it.

1:24:56Obviously, we have a lot more work to do.

1:24:58And I appreciate, Jonas, what you were saying, that there is a clear direction that needs to happen.

1:25:04There is clear improvements both on policy but also personnel, that you need more staff to be able to do this, to have the capacity to do this.

1:25:11What— and as you said, the timeline is going to be years, and we will certainly have more surprises happen.

1:25:17I don't believe that this is— I'm a big believer in Hanlon's razor, never attribute to malice what can be attributed to incompetence.

1:25:25What can this council do to help prevent this from happening in the near future?

1:25:33Councilor, thank you for that question.

1:25:34I don't know that this is the appropriate topic to discuss that, but I think it's helpful just to have the space and respect for the staff who do the work, who show up every single day with good intent to do good transparent governance and provide information to this body.

1:25:50So if I could make one request, that would be, that would be where I would start.

1:25:53Thank you.

1:25:54Thank you very much.

1:25:57Thank you, Council President Dunphy.

1:25:58It is 10:51 AM, so we're going to take a break and then come back with Councilor Pirtle-Guiney.

1:26:03We'll see you back at 11:01.

1:26:06Recess for 10 minutes.

1:37:30All right, thanks everybody.

1:37:32We're going to return, uh, from our recess.

1:37:36Process question.

1:37:37Yeah, absolutely.

1:37:39Thank you.

1:37:39I just have a process question.

1:37:41I, I know you said this beginning, but I need to hear it again now that we're in this new experience.

1:37:46Um, so each councilor gets 10 minutes?

1:37:48Yeah, and then if there's time remaining after everyone's had their first run at it, we might have a few more minutes for People to go a second time.

1:37:56And this meeting started at 9:30.

1:37:58When does it end?

1:37:59Scheduled to go till 12:30.

1:38:00We should wrap up a little—.

1:38:01This is a 3-hour hearing.

1:38:03Should wrap up a little before that though.

1:38:04All right, thank you, Councilor.

1:38:08So I'm seeing, uh, in the queue— so just, just a little context here.

1:38:13Councilors, uh, Zimmerman and Pirtle-Guiney have some time left in their initial run, and Councilors Ryan, Koyama Lane, Novick, and myself, and if Clark joins, will also have not gone yet.

1:38:22So we'll make sure that that queue gets a chance to go before circling back to anyone else.

1:38:26I see Councilor Pirtle-Guiney in the queue, so please feel free to take it away.

1:38:33I see Councilor Ryan in the queue and he hasn't gone yet, so I wanna defer if he would like.

1:38:38And if he would like a few more minutes, I'm happy to go.

1:38:40Go.

1:38:41Okay.

1:38:41Yeah.

1:38:42Okay, so you'll be next.

1:38:45CFO Vieri, At some point a while back in the questions that my colleagues had today, you said that it was normal to have some back and forth during the TAO process about what's in and what's not and when we make adjustments and that there are— I don't know if you used the word risks or if that's just how I heard it, but that there are some risks If we put something in when we don't have the numbers right.

1:39:17And I'm wondering if you can speak to the risks of putting something in if we don't have the numbers right, the risks of not putting something in, and just help us understand a little bit more what is behind the decision-making of when something is captured in that process, and if that happens in the fall or the spring, or if we wait until the next year.

1:39:39Thank you.

1:39:40Yeah, Councilor, thank you for the question.

1:39:44So, you know, every situation is often a little bit unique, right?

1:39:48There are some things that are very clear-cut.

1:39:49This is a $20,000 change to this specific contract.

1:39:53It's clear.

1:39:54There are things that are much more complex.

1:39:55This is an example of that that's much more complex.

1:39:58There is a risk, and one of the risks I was concerned about with not having confidence in the number is that we would suggest a solution of say $12 million of additional resource and come back and learn it was less than that.

1:40:12And that's problematic.

1:40:13Now Council has overappropriated dollars that aren't available and that requires coming back to make that adjustment.

1:40:19That would be unpleasant.

1:40:24The other reality is knowing that in the fall TAO specifically, at minimum we have a spring TAO coming up.

1:40:32So we know we have another opportunity to make that kind of a correction later in the fiscal year with the benefit of having Confidence in the numbers.

1:40:39And frankly, as council is aware, there are opportunities to make budget adjustments outside of those moments.

1:40:45So this wasn't a one-shot-and-done moment in the fall TAO from the seat I sat in and sit in.

1:40:51We have flexibility to be patient and do that work and provide council with an adequate level of information to make best-informed decisions.

1:41:03Thank you.

1:41:04So I think we've talked a little bit about the need for council to be informed earlier about things, and that's a conversation that I think everybody has had off the dais also.

1:41:14I don't think there's much question or controversy at this point about making sure that council gets information early, but this idea of should something have been in the TAO or not, It sounds like there are, I don't want to say regularly, but it's not unheard of for there to be things where we say, let's wait just in case.

1:41:39We'll have that other opportunity maybe in the future.

1:41:42Let's make sure council knows this is out there, but we may not want to move on it yet.

1:41:47That's kind of a, again, I don't want to say a regular question, but not an unheard of conversation to have to have as we figure out how to most responsibly and transparently make sure we know where money is at, that it's budgeted correctly, but that we don't inadvertently overspend our resources and then have to go back and find additional corrections.

1:42:11Is that correct?

1:42:12That's correct, Councilor.

1:42:13I mean, there are micro decisions every single day made by multiple people throughout this organization about those communication options and opportunities.

1:42:25Okay, thank you.

1:42:28Thank you, Councilor Pirtle-Guiney.

1:42:29Councilor Ryan.

1:42:32Thank you, Chair, and thank you to the professional staff, um, that have been answering most of the questions and have worked many, many extra hours to get to the bottom of the financial questions that are at hand.

1:42:45Um, and a big thanks to you, CA Lee, to DCA Oliveira, and to DCA CFO.

1:42:51I don't know what your title is.

1:42:52Is it both?

1:42:54I'm sorry, Councilor.

1:42:55DCA and CFO?

1:42:57Just CFO Beery.

1:42:58All right.

1:42:59Thank you.

1:42:59I'll do that right then.

1:43:00CFO Beery, for your forward-facing vision to use this experience to improve the financial systems at PHB and across the bureaus and offices who may still maintain siloed cultures unique to each bureau.

1:43:14The administration and council share great interest in this Thank you.

1:43:17Thank you, Mayor.

1:43:17I want to thank the city staff for this work as we continue to go through this transition of this new form of government.

1:43:22And this transition has been focused mostly on political restructuring, and it's now time to have an urgent focus on how to transition the city's operations from 27 independent bureaus and offices to a more efficient, integrated system.

1:43:38Currently, practices wildly vary.

1:43:40I think that's what's kind of at the heart of the matter here.

1:43:42Today's conversation is a symptom I'm not sure what new information I have learned this morning with the questions I have, um, I have heard asked.

1:43:53For more than half a year, we have experienced the preliminary investigation into the housing funds.

1:43:59I greatly appreciate our city's operational leaders who have handled this process with grace and are working hard to make the improvements for greater financial accountability.

1:44:08Thank you for your transparency as information was Thank you.

1:44:11When it was clear, you presented it to us, and I appreciate that.

1:44:16Housing funding is especially complicated.

1:44:18Each project has many funders from multiple government sources and private sector partners.

1:44:24This accounting is more complex than in some bureaus because of the variety of revenue streams.

1:44:30For you, DCA— or for, sorry, CFO Buri, restricted revenue has different rules than general fund revenue.

1:44:38Thank you, Councilor.

1:44:46So, right, as Ruth and others have mentioned, I think today, you know, a large majority of the city's dollars have some level of restriction.

1:44:54I think it's around 90% of the total budget is what's called a restricted revenue.

1:44:58And in general, that means there's a legal limitation on how those dollars are applied, how they're spent.

1:45:05So, for example, if you have a A common example is water revenues.

1:45:09We collect water revenues.

1:45:10Those can only legally be spent on water-related expenditures.

1:45:16That's a pretty clear-cut example.

1:45:18Housing dollars are a great example.

1:45:20The bond dollars came up in conversation.

1:45:22The legal documents that create that revenue stream put restrictions on how those dollars can be expended and be compliant with the law.

1:45:31So there are many different buckets of revenue.

1:45:33Yeah.

1:45:34I'll say sub-buckets, types of restrictions that apply to different types of funds in the city, all of which we say are restricted.

1:45:44And that includes the practice of it being multi-year expenditures?

1:45:49Very often those restricted buckets do have multi-year programs.

1:45:54There can be examples of a restricted dollar that only has a 1-year expenditure.

1:45:59A grant, for example, might be something like that.

1:46:01But many of those buckets, particularly the very large ones, are multi-year programs.

1:46:06We don't flip a switch on June 30th and say, oh, now we're gonna do something different on July 1st, right?

1:46:12It's often why audits and P&L statements don't always look the same.

1:46:16Correct.

1:46:16I mean, those are point-in-time assessments of what is in reality an ongoing daily operation.

1:46:22And that's very different than how we treat our operational general fund.

1:46:29It's different in that sometimes those restrictions put us We can put firmer bright lines around those, for example, over fiscal year transfers and carryovers, et cetera.

1:46:41Whereas general fund by its very nature is more discretionary.

1:46:45And also general fund, which is, I think of as operational.

1:46:48We want to expend those funds in real time, in immediacy, with more immediacy, 'cause that's what we do with general unrestricted funds.

1:47:00Yeah, Councilor, I would agree with that.

1:47:01I mean, I think it's— the caveat I would make is there are many funds, even restricted funds, where we do want to deploy those dollars quickly.

1:47:11It's a balance, right?

1:47:12There are funds where there are very good reasons why we want to hold those and not spend them immediately, right?

1:47:17And so that's true.

1:47:17I wasn't dismissing it.

1:47:19I was just saying that in a pattern, it's when you're looking at financials, having that distinction between restricted And I think sometimes when we get documents, it's not always easy for us to decipher that unless we drive deeper.

1:47:35Tell me about your process and plan to clean up the financial house at the Housing Bureau.

1:47:42Councilor, thank you for that.

1:47:44I mean, I think it's largely— that effort is complete.

1:47:48This is identified, as we talked earlier in this meeting, as a priority for the city.

1:47:53This has been important to identify where some of those gaps existed, to do a comprehensive look not just at the Housing Bureau but around the city and confirm that we're aligned to be clear, consistent, and transparent going forward.

1:48:07I think council can expect to see in the future at some point some policy updates and other kinds of requests to make sure we're codifying those changes in a meaningful way.

1:48:18But I think largely that fundamental groundwork has already been laid.

1:48:24And so this is— is this process then helpful to the bigger picture of establishing more consistent financial patterns throughout the city?

1:48:31I think identification of the gap has been an opportunity to rectify that.

1:48:37And City Administrator Lee, would you like to add anything?

1:48:41I believe CFO O'Berry has already touched upon a main component of But I think as we look through the whole city and really changing how we do operations and how we deliver services, we have to look at best management practices as related to how do we handle some of our internal functions as a city.

1:49:02Some of the things that we'll be looking into as we continue to evolve as an organization that will help towards this is a lot of our strategy and planning work.

1:49:11And how do we build out of our organization the really strategic direction that we're heading?

1:49:15And the expectations of that.

1:49:17Our performance and data analytics and our investment in that as an organization is going to be critical to this as well, to ensure that we're hearing— that we're hitting the performance measures that we want to hit as an organization.

1:49:32These are all critical things that are working in conjunction with each other to produce a better way of doing government and governing a city.

1:49:41And I'm I'm committed to it.

1:49:42I know our team is committed to it.

1:49:44I know the mayor and this council is committed to better governance and operations and providing that to the city as a whole.

1:49:52I know as we continue to look at staffing and as we come through some of the tough budget decisions that have to be made this year, we have to keep at the forefront of our minds and be intentional about how do we build this government back forward.

1:50:11Thank you, Saleh.

1:50:24Chair, I want to say this as advice to this committee of a whole with a financial lens.

1:50:30I hope that we take this conversation and that we look for updates on how the transition from unearthing those siloed practices and getting to some more common best practices.

1:50:42This is the continuous improvement work that Portlanders are demanding from us, and I hope we use this as a case study, not a shame study, to, um, continue to learn from how we can improve and go forward.

1:50:55Thank you.

1:50:57Thank you, Councilor Ryan.

1:51:00So, uh, there's no one in the queue right now who hasn't already gone.

1:51:05I'm going to probably do, uh, 5-minute increments going forward, and, and we'll just see how long we've, we've got available for it.

1:51:11And, uh, I'm just noting I am going to hop in the queue later on.

1:51:14Um, but I see Councilor Morillo in the queue, so we'll go to you and then Councilor Green for a second round.

1:51:19Yeah, I know that Councilor Avalos has to leave at 11:30, so I would prefer if she could go first and then me and then order Is that okay with you, Councilor Green, as well?

1:51:29All right, Councilor Avalos, you're recognized, and then we'll go to Morillo and then Green.

1:51:33All right, thank you all.

1:51:35So I have a follow-up question for Director Levine.

1:51:39I want to— while she's coming up there, I want to appreciate the line of questioning from Council President because I think, you know, I agree that like there's just kind of some remnants here that we're working through and that not everything needs to be seen as malicious.

1:51:55But I think the goal of this hearing is to really understand what we need to fix and change, because that is our, our job as the first government in the new form of government, and we need to be deeply committed to that change.

1:52:09So I want to talk about kind of the reporting structure that you're working within in the city budget office.

1:52:16So specifically, Director Levine, who are you accountable to in your role?

1:52:22And within that structure, what is the expectation for or how information is communicated to council?

1:52:30Sure, I can give an answer and then I'll look to the city administrator if he wants to weigh in as well.

1:52:36But I'm accountable to all of you and to the mayor.

1:52:45I guess it was a bit of a history lesson.

1:52:47The City Budget Office for over 10 years was an independent office Office, and the director reported to all 5 commissioners and the mayor.

1:52:57And with the change in the form of government, we are now rolled into the sort of administrative structure, currently in City Operations Service Area, but obviously have worked closely and was in the Budget and Finance Service Area.

1:53:18So Sort of administratively, that is where we sit.

1:53:23But I very much see the City Budget Office as retaining a neutral and independent lens.

1:53:31And, you know, our job is to provide high-quality budget information analysis and obviously to have a technically accurate, legally compliant budget for the City of Portland.

1:53:44So then, given that— thank you for that history lesson, that is important to understand.

1:53:49Um, given that though, if CBO makes a recommendation that council should take a certain action and that information doesn't come to us because it has apparently gone through a couple of layers of a CFO, a DCA, a mayor, um, can you help me understand then If your independence is what is standard practice, then how are you going to make sure that we are getting the independent information from the budget office as the budget authority instead of it being delayed by many layers of other positions that should not, per your reading, be in front of council having awareness first?

1:54:34Councilor Avalos, I would like to step in and answer that question.

1:54:37And in respect to the structure of government that we have, honestly, that's my role, to ensure that this council has the information it needs to make the decisions that it needs to make moving forward.

1:54:50The budget operations of our arm is under that administrative arm of our organization.

1:54:56And with that being said, my responsibility is to ensure that that communication is happening.

1:55:02If she's making, you know, if any, So when a city person within this organization is making a recommendation from the administrative arm of it, it's for me to decipher that information and make an ultimate recommendation to City Council from the administration arm of the organization, what our recommendation is or what we may feel as opportunities to change the information that we may have.

1:55:30And to just to clarify that, I just want to say that piece.

1:55:35Thank you.

1:55:36Um, I appreciate that nuance, and I think, you know, I think just to round out that question and to get final clarity, council does not receive information directly from CBO without going through additional layers first, including your office.

1:55:52Is that correct?

1:55:53That is correct.

1:55:55Okay, well, I think that is something we should look into as far as Um, what it looks like to ensure that channel is not disrupted by other offices, including the mayor's office.

1:56:10I know I'm going to run out of time here.

1:56:12I have another kind of line of questioning on that.

1:56:15Um, but for now, I'll, I'll leave it there.

1:56:17Thank you.

1:56:19Thank you, Councilor Avalos.

1:56:20We'll go to Councilor Murillo and then Green.

1:56:23Thank you, Chair.

1:56:28I was hoping we could have DCA Oliveira come back up.

1:56:38I was wondering, who was the party that overruled CBO's recommendation that the RSO funds be included in the TAO?

1:56:48That was CFO Berry's call, from my seat.

1:56:50Thank you.

1:56:52And what was the basis for that overruling of the city's expert budget body?

1:56:56Perhaps it's a question for Beery.

1:56:59I would defer to him for that.

1:57:00Please stay up here.

1:57:02Yeah, thank you, Councilor.

1:57:04So it was ultimately my call.

1:57:07I also wanna acknowledge that during that window at which this decision was made, City Administrator Mike Jordan was out of office and had delegated to me authority to act as City Administrator.

1:57:20Thank you.

1:57:22I have a question for Donny following up on that.

1:57:26You previously indicated that you gave the mayor and city administrator a heads up on these funds in early September.

1:57:32You then proceeded to produce multiple policy proposals for the use of those funds in multiple memos and engagements with the Portland Housing Bureau, the mayor, and Portland Solutions.

1:57:44If we grant that inclusion of these funds in the TAO required additional financial vetting, Is there any reason we couldn't have received the same heads up as council that the mayor and the city administrator did in the funds in early September?

1:57:57Because you gave that heads up with a caveat that the information was not fully vetted, correct?

1:58:01Correct.

1:58:03And because there would be value in being aware of the funds broadly while discussing the TAO, even if we didn't have absolute certainty of the precise figure and it couldn't be formally submitted to the TAO, right?

1:58:13Correct.

1:58:14The charter requires that regular notification of the financial status of the city go to council, not a fully vetted proposal.

1:58:23So to be clear, this number was precise enough for you, the Portland Housing Bureau, the administration, and Portland Solutions to make proposed spend plans, correct?

1:58:36We were working through the information at that time, and that was part of the process, correct.

1:58:40And it was precise enough to negotiate the allocation for 4 months, precise enough to build a replacement proposal in 72 hours after the records were slated to be released?

1:58:52The, the councilor, the last, the last iteration I wasn't privy to.

1:58:57It was shared with me.

1:58:58Um, so I, I just want to be clear that the time frame I think you were talking about earlier was that September-October window.

1:59:05Um, in that last iteration Okay.

1:59:14I guess with all the information we're receiving today, I am a little bit surprised that we are needing to wait to vet the financials to avoid giving council inaccurate information as we have the power of the purse.

1:59:25Because aside from the fact that this wasn't a concern in sharing the RSO information with the mayor and city administrator in September, The fall— Not having this information has guaranteed that council was operating with incorrect information when we were deliberating the TAO.

1:59:41We were deliberating the TAO on a false premise, and the existence of a next budget vehicle doesn't explain why the fall vehicle was used to present a deficit picture while it was clear enough for the administrator's planning that that deficit did not exist.

1:59:55So generally, I think maybe this is a question moving forward for my councilors, for the city administrator, and for the city staff.

2:00:03Is this a precedent that we want to accept?

2:00:05That every bureau for every future unbudgeted balance has 4 to 6 months disclosure grace period?

2:00:11That we can sit on material facts, only for City Council, by the way, for one budget cycle so that as long— so long as they potentially surface in the next one?

2:00:21And City Administrator, I guess that's honestly a question for you.

2:00:24Is that a precedent that we should expect moving forward?

2:00:29That's not what you've received from me to this date.

2:00:33Thank you, sir.

2:00:34And I know that some of these issues preceded your arrival, but I think that there, there is a disconnect here between what council has received as the budget authority and what all of these agencies are receiving and how they are deliberating and making budget and policy decisions without the representation of each district.

2:00:55That's what's happening.

2:00:56So I want to be very clear about that.

2:00:59I don't have— let me check to see if I have any further questions at this time.

2:01:04I think that ends my questioning.

2:01:05Thank you.

2:01:06Thank you, Councilor Morillo.

2:01:08We'll go to Councilor Green, then Councilor Pirtle-Guiney.

2:01:12Thank you.

2:01:12I just have a few more follow-up questions.

2:01:14Thanks for both being up there.

2:01:15I have questions for each of you.

2:01:18To DCA Oliveira, Earlier in this hearing, when I was asking you about the process from the October 27th memo to whether or not it got into TAO, you suggested that the former director was on leave and you didn't have a chance to talk to her about the nature of that spending plan, and then it didn't make it into the deadline for the TAO.

2:01:41That's what you said earlier, right?

2:01:43I was referring to the September 5th deadline.

2:01:46That was the first deadline.

2:01:48Because I believe she was on vacation.

2:01:51Okay, thank you.

2:01:52That's— so in my understanding, it's standard practice to, when a bureau director goes out on vacation, to sort of delegate to their deputy.

2:02:01Hey, I'm on vacation.

2:02:02In my absence, you're acting.

2:02:04Isn't it true you could have conferred with the deputy bureau director about that spending plan and move that work forward?

2:02:10That was an option, yes.

2:02:11Okay, thank you.

2:02:13For CFO Biery, I've got a couple questions.

2:02:16I want to go back to the TAO because we've talked a lot about uncertainty and confidence in numbers.

2:02:22During the work session of, I think it was October 22nd, we really dug into the assumptions in that, and a number of us, I think myself in particular, raised questions about one of the kind of resources that was going to be identified to make us whole in the spring should we find ourselves short because we were using spring resources in the form of compensation set-aside.

2:02:45So isn't it true that confidence was low in the TAO due to the efficiency savings?

2:02:51Because that was a speculative sort of resource that we don't really have any history on it, and it's not an actual line item in a budget.

2:03:00It's just something that we hope to materialize.

2:03:02Wouldn't you characterize that as a low-confidence resource?

2:03:05That's fair, Councilor.

2:03:06I would consider that effort as a low-confidence resource.

2:03:08Thank you.

2:03:11And just stepping back more generally, isn't it also true that confidence is always low or medium-low when it comes to BLT forecasting 'cause it is a volatile revenue stream?

2:03:24Councilor, I want to be really cautious 'cause I think we're making some causal assumptions here that are not apples to apples.

2:03:33You are correct that that is, An assumption.

2:03:37And there are many, many assumptions we make, some with confidence, some with lower confidence.

2:03:41I'm asking the questions because earlier it was suggested that we don't want to make assumptions in our budgeting using uncertain sources.

2:03:49And I'm trying to establish here that we already do that in practice.

2:03:52Yeah, Councilor, you're correct.

2:03:54And I will say it is very easy to look at a prepared document 6 months in hindsight and feel Like there should have been confidence in a number at any given time.

2:04:06That was not the reality in the moment in October, in early November when this information was becoming aware.

2:04:14From the seat I sit in, as soon as I had a reasonable level of confidence greater than zero, which is the number that I had in that October window, that information was promoted to be shared with council.

2:04:27That is different from— I'm not saying that.

2:04:30Realignment conversation that you're referencing, different from a BLT assumption conversation where there is some level of confidence, even if it's not 100%.

2:04:39I understand that, but during that discussion and that debate, one of the major points of contention was that we were paying for our policy encumbrance carryovers that were driving a $60 million deficit with compensation set aside.

2:04:55And the solution was, well, we're going to realize efficiency savings.

2:04:59And meanwhile, in an October 13th memo from the Portland Housing Bureau director, we see a very precise number that is $2.75 million that could be returned to the general fund.

2:05:09And so I don't know how you get to a precise number like that if there's not some level of confidence in the $12 million, because we've been talking about we don't know if it's $12 million, we don't know if it's $21 million, but we, but we, we knew it was $12 million all along.

2:05:21I think the general fund is And so that's—.

2:05:22And that general fund return was never brought into that discussion.

2:05:25Councilor, I think again, I've heard DC Oliveira, I think accurately say that there was confidence maybe in the Housing Bureau and from his seat.

2:05:32From the seat that I sat in at that moment, my confidence level was zero in the accuracy of that number and existence of that.

2:05:40Okay.

2:05:41And my last question here is, you know, at that time after the TAO was presented, several councilors were working with the CBO I was one of them.

2:05:53Councilor Morillo was one of them.

2:05:54And Councilor Smith was one of them.

2:05:55Each of these amendments were seeking to provide things like rental assistance and, you know, HIF nexus funds.

2:06:04I'm curious why these offices were not informed that there may be resources available from these funds, however uncertain they are.

2:06:10Maybe perhaps we'll know more later in the year by spring.

2:06:14Would caution you to hold off on this amendment until then.

2:06:16I'm curious why they were not told about that.

2:06:18This I think that's a fair point.

2:06:18If the CBO understood that these funds could be—.

2:06:20I would just answer, Councilor, as I just did, that my confidence level in the existence of those dollars at that moment were zero.

2:06:26Okay, thank you.

2:06:27I have no further questions.

2:06:28Thank you, Councilor Green.

2:06:30Um, I know I said Councilor Pirtle-Guiney, but because Councilor Koyama Lane hasn't gone yet, I'm going to go to you first and then over to Councilor Pirtle-Guiney.

2:06:38Okay, thank you, Chair.

2:06:40To understand the timeline and flow of information a little bit more, I have a question for Mr. Bonacore.

2:06:48Our current interim director of Portland Housing Bureau.

2:06:52I want to start with your November 17th email to DCA Oliveira, where you are saying in that message there's an additional $9 million in accumulated SRO revenue held in reserve that, um, that you were not advised— of which you were not advised to.

2:07:12You didn't know about it.

2:07:13Um, when did you first become aware of the reserve fund?

2:07:16And then also, what prompted you to Thank you, Councilor.

2:07:23Councilors, Michael Bonaccor, Interim Director for the Portland Housing Bureau.

2:07:28As I recall, a lot happened all on that day, and I had been asked to sort of look at the recommendations that had been made for, I think, 11.3.

2:07:44$7 Million.

2:07:46And since I was in the seat as interim bureau director to sort of revisit recommendations with the team and put forward if there were any changes that I would recommend.

2:07:57So as I was having that conversation, the number $21 million came up for the first time that I had heard it.

2:08:08And that was really surprising to me because I had, you know, in, in no conversations with anyone had I heard the number $21 million.

2:08:17So I clarified with the team that number.

2:08:22I then called DCA Oliveira, disclosed it to him.

2:08:27He asked me to send the email that I had sent with, uh, that you're referencing with the rec— the recommendations that we had been working on for the $11.7 And to name that I had learned about an additional $9 million.

2:08:43And those recommendations, you were working on them?

2:08:47Yes.

2:08:47And were there also recommendations that you know about that former Director Hissrich had given also for these funds?

2:08:53Yes.

2:08:53Okay.

2:08:54And were those separate suggestions or those were—.

2:08:58Yes, they were.

2:09:00Director Hissrich Director Hisarick's recommendations largely informed mine.

2:09:05Everything that we were considering in the bureau at that time was really very much in the lane of what the— of the kinds of spending that RSO would do.

2:09:16We were not thinking really more expansively than that.

2:09:19Do you know when Director Hisarick gave those recommendations?

2:09:23Oh, I know the memo is dated Yeah, I don't remember the date off the top of my head.

2:09:30And when you shared this email with Mr. Oliveira, what led you to think that he had not already been made aware of these funds?

2:09:40We had had a number of conversations in which, you know, as I said, I was working on a set of recommendations based on the approximately $12 million number.

2:09:52That number is the only number I had ever heard him say.

2:09:56And so it was alarming to me that there was a different number that I hadn't heard him say.

2:10:00Okay, thank you.

2:10:02And for Mr. Beery and Mr. Oliveira, my questions for you two are, as we— give you a moment— as we're looking forward to accountability and continuous improvement, can you share concretely your key takeaways from this whole situation, what specific changes you're implementing to ensure that issues like this are not repeated.

2:10:31Thank you for the question, Councilor.

2:10:33For my part, certainly being a little bit more intentional with questions for my teams in the service area about budgets.

2:10:43I think I shared this in an executive session at the time.

2:10:46During the budget process of last year, I was working with 2 interim directors at PP&D and Prosper.

2:10:52So my priority largely focused on them.

2:10:54I was relying on my more senior directors at the time at BPS and Housing to take care of their business.

2:11:01They had the experience.

2:11:03There's also more challenges at Prosper and PP&D in the budget process, as you're all aware.

2:11:07So I think for my part, it's one is just being a little bit more intentional there, asking questions more thoroughly, Thank you.

2:11:12And not making assumptions about oversight.

2:11:15And then as we've talked about already and I've shared, definitely appreciate your seat and the expectation for getting communications about budget-related issues, even if it's not exact or finite.

2:11:26I'll defer to CFO Berry about the appropriate level of accuracy, but at least acknowledging that there's some discrepancy in a bureau's funding or finances and working with the CFO and CBO on that.

2:11:40And of course, CA Lead, Um, is a key takeaway for me.

2:11:43And, uh, I think that's just from my seat.

2:11:48Um, I over— um, let's see, I, I overemphasized ensuring that you were getting accurate information versus urgent information.

2:11:58And there was— there's probably a pendulum swing back to balance that out to ensure that you're getting information even if there are confidence in it's, it's lower.

2:12:07Again, And mine was a little higher than CFO Beery's was, but for my part, I can at least communicate that out.

2:12:13And then lastly, and this goes just to general work I think the city's doing led by Caley and CFO Beery and the CBO office, Director Levine's leadership, is how we're telling the— how we're communicating about our budget.

2:12:25Our city's very complex with various funds.

2:12:28Not all of them are the same.

2:12:29And I think internally as subject matter experts, or if you will, We speak in technological terms or technocratic terms, and we need to ensure that we're communicating very clearly so people understand the distinction between unbudgeted versus appropriated versus unappropriated.

2:12:47Those things are meaningful matter in terms, so we're not conflating issues.

2:12:51And that's just something that we can work on and get better at.

2:12:52So those would be the 3 big takeaways that I've certainly experienced through this process.

2:12:58Appreciate this body's You know, intention on oversight and trying to get the answers for the public, 'cause I think there's a lot of lessons that we learned along the way.

2:13:09Yeah, thank you, Councilor, for the question.

2:13:10Agree with everything DCA Oliveira said.

2:13:13Would add, you know, sometimes I like to be right, sometimes I don't like to be right.

2:13:20And I flagged long ago that we were going to experience deficiencies that would lead to these gaps.

2:13:26We've seen that in the material findings we found in the ACFR.

2:13:30We've found that we have gaps in our ability to communicate between the budget office and accounting office and have the infrastructure to manage that in a way that avoids these complications and creates a pathway to have that clear, transparent communication to council and the public.

2:13:46So just one takeaway is that we do need to get serious about solving that.

2:13:53And it's not something I can do from— as one human being.

2:13:57Who sits in this seat.

2:13:58It's a systematic improvement that frankly has to start in this room.

2:14:02And so that's a takeaway.

2:14:03Let's— I appreciate the sort of shared accountability and shared knowledge around this exercise.

2:14:09I think it has been very, very valuable in daylighting some very specific gaps, and we're working as hard as we can to correct those through policy, through practice, through communication, and continuing to grind every day to get that transparent information to you until Thank you.

2:14:27City Administrator Lee, do you have any specific concrete changes that you're implementing or you plan to implement to make sure that issues like this aren't repeated?

2:14:38Some of it is some of the things they've already mentioned.

2:14:41Some of it is organizational structure and how we're structured as an organization as it relates to the budget and the finance arm being really tied together as we move forward as an organization.

2:14:54And then as we look at building out a comprehensive plan of really addressing some of the challenges we're facing in the interim of changing our form of government, 'cause we did it on paper, but the actions of the work that has to be done is still a work in progress.

2:15:14And one of the things that I've seen as coming into this role as it relates to this kind of change of government, we have struggled from a change management standpoint.

2:15:25Change management has been critical in this change of form of government that we've had, that we have struggled through as an organization.

2:15:34And we have to be intentional about how we manage change management as an organization because this is a tremendous amount of transformation that is taking place in this organization.

2:15:46We can't lose track of the people in our organization that this is impacting as well.

2:15:52They are going through this same transformation, having the same struggles that this body is seeing as well as it relates to the change of government that we're having.

2:16:00So as we look at our organizational structure, as we put more funds towards how do we do change management and not let it be a second fiddle to the conversation that we're having as it relates to How do we change the way that we do business as an organization?

2:16:16I think that has to be at the forefront of the conversation that we're having as we move forward.

2:16:21And we have to be intentional about the resources we dedicate to change management and also the resources that we need from our financial arm as an organization.

2:16:31Because as we look at core functions and services as an organization, finance and budget is one of those key things That we have to make sure that we're investing in appropriately and looking at how we do budget moving forward as an organization.

2:16:48It's also going to be as critical.

2:16:50So as we look at me building out kind of a roadmap through this transition, that's one of the key things that I will be focusing in on is these kind of change management things as we roll out an organization.

2:17:05And I want to be transparent with council.

2:17:07Of where we are in that process.

2:17:10So my first, I would say, 90 days has just been watching and evaluating, making minor changes in there if things were critical, but just seeing how we do business as an organization.

2:17:23And as we move forward, it's really gonna be looking at how do we improve our operations overall and do we have the right pieces to improve?

2:17:33Our operation overall as an organization.

2:17:36And I wanna make sure that we're doing those things in an intentional fashion, but also in a transparent fashion that the community understands the progress that we're making as an organization, but understands the timing and the timeline and timeframe of those type of changes and what those expectations should be for this organization.

2:17:58Thank you for that.

2:17:59And it's helpful to hear kind of high level your vision there.

2:18:03Are you able to give an in-the-weeds— I know we're not going to go into it, but an in-the-weeds example of a change that you have made?

2:18:10For example, a certain process now works this way, or there's a deadline, just to see an example of what that looks like in practice?

2:18:17I think you've seen it just in the communication that you're seeing and the consistency of that communication that you're seeing from the city as a whole.

2:18:25As it relates to the information that you're getting through this budgeting process, the uniformity of those information that you're seeing.

2:18:33I think that's one of the key things.

2:18:35I think that we have seen some sort of breakdown between the council and administration.

2:18:41It's just those lines of communication and making sure that that communication is happening in a fashion that— and being received in a fashion that you're getting the information You need to make decisions.

2:18:52And I could go into more details about it, and I know we'll have some more conversations about this as we move around.

2:18:58But the biggest thing that I, I've been trying to emphasize is just the communication piece of how we're communicating with council.

2:19:05Me actually dedicating the time and the agenda to actually sit down with each one of the councilors to kind of go through the top priorities that you're— and challenges you are facing, but also talk about the top challenges and things that we're looking at from an administration arm of the organization and making sure that you're well informed and well engaged in those conversations.

2:19:29Thank you, Councilor Koyama Lane.

2:19:30We'll go to Councilor Pirtle-Guiney, then Councilor Smith.

2:19:35Thank you, Chair, and thank you, Councilor Koyama Lane, because that was one of the 2 questions I had written down to ask right now, and I think it's a really critical question for us to be asking today.

2:19:49Oversight is a lot of things, but among them, and I think one of the most important for a body like this, is figuring out how to make things work better, not just for us but for Portlanders.

2:20:05And that question around the very specific Hey, what's going to change?

2:20:11Um, is, I hope, the core of what we're getting at.

2:20:17Um, and I think there's a lot of other ways we could have done that, but here we are today, so we're doing it this way.

2:20:25Um, I will ask, since that question has been asked, CFO Beery, there have been some questions about If we had had this money for the TAO, what would have been different?

2:20:39And ultimately, in the spring TAO, we were able to return some money to the general fund to fill what had become an even greater hole.

2:20:49Sitting where we are in mid-April, if we had had that money for the general fund in the fall instead of in the spring, would anything be different?

2:20:58I think it would have been different.

2:21:00Would we have had more?

2:21:01Would we have plugged holes in different ways?

2:21:03Or would we be pretty much in the same place here in mid-April today if we had had this information, let's say, 2 months earlier?

2:21:16Right?

2:21:17If that information had been shared with DCA Oliveira in May or June of last year and we had gone through all of this 2 months earlier and had Thank you, Councilor.

2:21:30That's a good question.

2:21:31I think from a purely budget and financial perspective, we would be essentially exactly where we are today.

2:21:37Okay.

2:21:38Thank you.

2:21:38That's helpful in my thinking about this.

2:21:43You know, I know we're mostly asking questions, but I do want to make sure, colleagues, that we're thinking about what we're trying to get at today.

2:21:54We've asked a lot of questions that lead to information that I think we already have the answers to.

2:22:01And there's a lot of different ways to do oversight, and it was said at the beginning that it's important that this isn't the last time we do oversight.

2:22:10I'm a firm believer that oversight should be a part of what our committees do regularly.

2:22:17This program isn't working.

2:22:19We're hearing about that It should be a part of the conversations we have, CA Lee, with your administrative team on a regular basis.

2:22:32And so I just hope that what we're trying to get to today is a better working relationship and an understanding of how things can work better in the future.

2:22:43Because, CFO Berry, to your point earlier, we will find a way to do this.

2:22:46Thank you.

2:22:47This will happen again because we are working on cleaning up our accounting practices.

2:22:53And in fact, this is a testament to the fact that this form of government is working, that we are going to find those things.

2:23:03And I want to make sure that we are moving forward in how we are doing better for Portlanders and not Exactly what date did exactly who know on things where we would have ended up right where we are.

2:23:19So thank you.

2:23:20I appreciate that answer.

2:23:21And again, thank you to Councilor Koyama Lane for the question about lessons learned and taking that one off my plate.

2:23:30Thank you, Councilor Pirtle-Guiney.

2:23:32Councilor Smith.

2:23:33Thank you, Mr. Chairman.

2:23:36I would like Michael Bonaccar Yes.

2:23:40Uh, Jonas, CFO Berry, DCA Oliveira, and, um, CBO Director Levine.

2:23:53And I just have one question.

2:23:54I, I, I agree with what, what, um, Councilor Pirtle-Guiney just said.

2:24:00This is a big task, and we're all learning at the same time.

2:24:05And I think we're trying to learn and walk and chew bubble gum at the same time.

2:24:11And as Councilor Morillo said, we should be able to do that.

2:24:14But there's so many moving balls and communication, getting communication to all 12 of us, that is a big task.

2:24:22And I do recognize that.

2:24:24But before I ask you all this one last question each, I want to say this to CA Lee.

2:24:30Do you think it is unreasonable— and we're in an oversight hearing— do you think it is unreasonable for council to ask where every penny is in this, in this city?

2:24:45Is that an unreasonable ask?

2:24:49No, it's not an unreasonable ask.

2:24:51Thank you.

2:24:52I have one question, Michael.

2:24:56On February 4th in a city council meeting, because most of my questions were answered, I really didn't necessarily need today.

2:25:04Uh, I asked you the question, did you know that you did not report the monies, uh, from the Housing Bureau, the $20.7 million?

2:25:13You said yes.

2:25:15I said, did your people know under Oregon budget law we have to budget every dime, even if it's in Reserve?

2:25:23You said yes.

2:25:25And I said, that's a large amount now that we know that it's, it's increased.

2:25:30Was this over multiple years?

2:25:33And you said yes.

2:25:34So I was good.

2:25:35So I think there's a big elephant in the room that we're kind of dancing around, and I want to clear this up today.

2:25:43Did Michael Jordan or Mayor Wilson Did Mayor Wilson direct you to not tell us about unbudgeted funds?

2:25:53Michael?

2:25:54No.

2:25:56DCA Oliveira, did Michael Jordan or Mayor Wilson direct you to not tell us about any unbudgeted funds?

2:26:05No.

2:26:06CFO Berry, did former City Did former City Administrator Michael Jordan or Mayor Wilson direct you to not tell us about unbudgeted funds?

2:26:20No.

2:26:20You'll need to unlock your iPhone first.

2:26:26And I'm going to ask you, CBO Levine, Director, did former City Administrator Michael Jordan or Mayor Wilson direct you to not tell us about unbudgeted funds?

2:26:43No.

2:26:44Thank you.

2:26:45I think that was the only question that I had from that day.

2:26:51I think we're going to have these growing pains, and I want to be able to build trust with all of you so that it is smoother going forward.

2:27:01That is my only goal, and to make sure that we that we as policymakers, that even if money goes into reserves, that we can put it in reserves.

2:27:12Just let us know.

2:27:14Thank you so much for preparing us for today.

2:27:19Thank you, Councilor Smith.

2:27:20Go to Councilor Novick, and then I'll put myself in the queue.

2:27:24I want to thank Councilor Pirtle-Guiney for 2 things.

2:27:26One, for pointing out that when all is said and done, we probably aren't in a different financial position now Or have made different policy choices than we would have if we'd known more sooner.

2:27:36That doesn't mean that, you know, no harm, no foul.

2:27:39That doesn't mean that maybe we shouldn't have known certain things sooner.

2:27:41But I think it's important for the public to know that there haven't been like drastic consequences to the city as a result of what some would characterize the delay in the council hearing stuff.

2:27:52On a lighter note, I want to thank Councilor Pirtle-Guiney for something else, which is that given my age and that Watergate was a central thing in my childhood.

2:28:01When I think of anything relating to oversight hearings, that's what I think of.

2:28:05And so I've been thinking about that today.

2:28:06And then Councilor Pirtle-Guiney delightfully said, we will find some, some more money, which is reminiscent of one of the great Watergate lines, which is, yes, we can find the money, but it would be wrong.

2:28:18So thank you, Councilor.

2:28:25Thank you, Councilor Novick.

2:28:26I thought I had a little more time there to get prepared, so I'll ask I'm going to ask a few questions now as well, and I appreciate everybody being here.

2:28:34And, and please take my questions as trying to understand a few particular points, and they're kind of for anyone that can answer from up here.

2:28:44And I, I imagine probably not the director, uh, Bonaccor, but maybe the other 3 folks up here.

2:28:50It's been said multiple times that the $11.75 million number was not certain.

2:28:55From late August, I believe, till the disclosure in November, which itself was a day or two after the $9 million that made it $20.7 was confirmed.

2:29:05So the disclosure actually occurred at a time of maybe maximal uncertainty because of that additional $9 million being added.

2:29:16I want to point out that while that number, the $11.75, which did not change, was being verified several So my question is, was it— how was it reliable enough of a number for administration officials to develop plans to spend it, but not a reliable enough number for council to know about it and be able to develop plans themselves, ourselves?

2:29:40I'll take that question, Councilor.

2:29:43So there was a couple of things happening in parallel.

2:29:46Just there was the Like, the question of answering, like, what— well, first, how did the money— why was the money not budgeted?

2:29:52Like, what was the, the dynamics that allowed this, this particular tranche of resources to be there unbudgeted?

2:29:58And then the question of what— where are allowable uses?

2:30:01What is the program typically doing?

2:30:02There was just like a 101 of, like, what does this thing do?

2:30:05And essentially, the, the bureau producing expenditure plans is what they would have done as a part of the budget process.

2:30:12I think that's something that has sort of been lost in translation.

2:30:15Picture a scenario where the bureau had actually put it in fiscal year '25-'26 budget, or even before that, but just, you know, for this year, those dollars would've been budgeted with a plan.

2:30:26So the question is essentially, how would you have, if they had been budgeted appropriately, how would you have done that?

2:30:32Like, what would those dollars have gone, you know, towards?

2:30:34So there was sort of that machination.

2:30:36That was the first iteration that Director Hissrich contemplated in hers.

2:30:39And after our conversation in September, Yeah.

2:30:41We had that second pass that she shared in October that included that particular case that there was a general fund allowance in those dollars, right?

2:30:49So that's one path.

2:30:51And then there's that second element, which is the confidence in the numbers.

2:30:55So let's figure out what they're used for.

2:30:57How would you use them?

2:30:58But then also, hey, we got to do some due diligence.

2:31:01How do we miss these dollars in the first place?

2:31:03What's the real number?

2:31:04So that was happening in parallel.

2:31:06I also just want to reiterate and restate that October was a very difficult time for the, you know, the Housing Bureau for different reasons.

2:31:13Sure.

2:31:13And when we got to that point of confirming the 11.75, it was also at that same time as they were like lockstocking that number in, um, that's when the reserve concept of with the additional $9 million came forward, which the Bureau had apparently discussed prior in the summer.

2:31:31That wasn't made— I wasn't made aware of that until Michael's email to me So that $9 million, just add, that was just an additional number that was validated as being, yeah, that number's accurate.

2:31:41They're really there.

2:31:42Okay, so that's essentially the parallel that was happening.

2:31:45So that's how those 2 things can happen at once.

2:31:47So I'm trying to understand what other than the OPB conversation and the policy recommendations ultimately alleviated the uncertainty sufficient for you to disclose it.

2:32:00Well, you wanna?

2:32:01Yeah, Councilor, thank you for that.

2:32:03So again, as we've talked about previously today, There's the things that the bureau was working on and the point in time that I became aware and confident.

2:32:13And so we're talking about 2 different simultaneous tracks.

2:32:16Okay.

2:32:18I also will— so if I had the ability to sit in every PHB meeting and every bureau conversation, there would be like 7 of me, probably 12 of me.

2:32:29That's not what exists.

2:32:30So that was not a possibility at that time.

2:32:34Also just want to acknowledge that putting the TAO together itself, happening exactly the same time, very heavy lift.

2:32:42City Administrator Jordan was out.

2:32:43I was acting as city administrator and taking on those responsibilities, including prioritizing the Protect Portland initiative, which was coming to council exactly during the same window.

2:32:53So I just want to set the stage of the difficulty in having clarity about that information.

2:32:58Thank you.

2:33:00I had confusion about an $11.75 million number, and I had seen another $12.2 million number and had not seen under the hood to understand what those were.

2:33:10I made the call, given all of that confusion, to not highlight it for the public and for you because I was 0% certain about any of that information.

2:33:21And I've said that multiple times out loud and taken these public lashings If there's something else you would like me to say to answer your question, I'm happy to speak that.

2:33:32So I'm, uh, I just want to point out I've asked one question.

2:33:36So I understand that you may have a frustration with that, uh, and I apologize for creating that, but I've asked one.

2:33:42Uh, so I'll move on because I'm, I'm trying to understand here if there is a difference in the mind of— and I understand it's not a monolithical monolithic organization, but is there a difference from just a follow-up to that in notifying council and notifying the public?

2:34:04I will answer that question.

2:34:05I think what I have seen through this council at times is notifying this council at times has been notifying the public, uh, as information— as we have shared information with the council That information has reached the public in that fashion.

2:34:24Typically in any government, we know it has that possibility to do it.

2:34:29We would hope in those kind of conversations, as we are having these conversations and working through things, that we could have those conversations with the intent that those conversations are happening with us and between us, and that we will develop and rationalize a plan of how do we We communicate to the community as a whole once we have accurate information and we're on the same page of what is that information that we'll be communicating to the public.

2:34:57Because I've— as I've been new into this community, I think that's some of the frustration that I've heard from citizens as they have reached us, reached out to me as it relates to it doesn't seem like The administration or the council are on the same page and there's bickering between the two.

2:35:19And I say I don't have any issue with the council and I haven't experienced that, but that has been the communication that has been shared with me.

2:35:27And I think that has raised some of the tension that you have here and some of the frustration that we have at the current state of the flow of communication and how that communication And I think there's room for growth on both ends of it.

2:35:44There's room for growth from the administration end and how do we communicate and ensure that council has that accurate information.

2:35:52There's room for growth from a council, from a grace standpoint to understand that, hey, we're gathering that information and be patient with us as we gather that information and communicate to council the information that we have.

2:36:05Thank you.

2:36:05Thank you.

2:36:07I, I'm— I might circle back to that, but I, I wanted to, to come in on these, and I, I want to note the mayor's been here, uh, patiently and, and hasn't had been called on.

2:36:15And, and feel free to jump in, Mr. Mayor, if this, if this is something you'd like to.

2:36:19Um, I want to understand the sequence though.

2:36:22Uh, so just make sure I have this right.

2:36:23It looks like the City Budget Office recommended the inclusion in the fall TAL.

2:36:28Housing Bureau Director also provided recommendations at the time, and then And then shifting a little further forward to, I believe it's the weekend of the 17th, 16th of November, there's a time where responsibility for developing these recommendations shifted to Portland Solutions.

2:36:45And that's— is that an accurate description of what happened?

2:36:47I see there was an email from Director Brocker-Knapp at that time with the— in the records of— with the recommendations.

2:36:59The Portland Housing Bureau and Portland Solutions were really teamed up together on the Shelter to Housing Strike Team, so they had a close relationship.

2:37:07We meet every single week, uh, different sort of discussions are at the table, but there's a relationship between the two to address the, uh, housing and homelessness emergency.

2:37:18Thank you, Mr. Mayor.

2:37:19So would I be correct in saying that that was the process working as it was intended to?

2:37:25The communication, yes, but specifics, you know, I can't speak to the specifics on the measures that we were discussing at the time or the money.

2:37:34In terms of the content of the recommendation?

2:37:36Yeah, exactly.

2:37:36Fair enough.

2:37:37Thanks.

2:37:40At what point, I guess we've asked, you know, where many other of the other folks at this table have been involved.

2:37:50I'm trying to understand at what point— and this is to circle back to, um, to the question I asked to City Administrator Lee— at what point the mayor, your office, became aware of the money?

2:38:03Because my understanding from the records is it's, it's a significantly, maybe a couple months gap from then to the council side.

2:38:10Is that accurate?

2:38:11And by the way, I think you should know as early as possible.

2:38:13I want to be very clear about that, uh, up front here.

2:38:15I think the But I just want to make sure I understand that there was a gap there.

2:38:22Is that accurate?

2:38:26Sorry, accurate gap?

2:38:27Sorry, can you clarify the gap?

2:38:29The gap between when the mayor's office was notified and when the council was notified on November 20th.

2:38:36Early on, when the numbers were first shared with me, I gave the mayor's office a heads up.

2:38:42City Administrator Jordan, CFO Berry, and the mayor, like a heads up with no— it was a passive comment in a— or passing comment in a check-in.

2:38:53There's something at the Housing Bureau, we're going to figure it out.

2:38:56Like, it was a very high level with not specifics because this was in that early September— excuse me, early September period where we were still figuring it out.

2:39:04So I would say that was the first time.

2:39:07And then more specifics came later in October, at the end of October, early November, when we said, okay, this is— this looks real.

2:39:13Thank you.

2:39:14So the gap was more like 2 or 3 weeks, maybe?

2:39:18A month, yeah, I would say.

2:39:20Okay.

2:39:20And it so happens that these 2 or 3 weeks were pretty significant because of the TAO and because of everything else going on, which CFO Beery pointed out.

2:39:27But it's not a lengthy, you know, number of days, nominally speaking.

2:39:32But I appreciate that.

2:39:33I'm trying to understand, I guess, and this goes back to the previous question about the distinction between telling the council and telling the public.

2:39:43Does that distinction exist, or does— can— is there a similar distinction in terms of notifying the mayor's office and notifying the public, CALE?

2:39:53Typically, in the form of government that we have, the mayor would've probably been the first person to know as the executive arm of the organization.

2:40:02And then we would've probably notified council president and vice president in there, then distribute out the information to the full council.

2:40:12That's typically how I would have worked a communication chain like that.

2:40:15Make sure the leadership of the organization is aware of the situation, then making sure that communication is hitting the full body.

2:40:24Okay, I have a comment on that, but I did want to ask one other semi-related question to CFO Beery.

2:40:30I appreciate your point about operating on a I also know that that's true of the City Budget Office and many other parts of our administration right now.

2:40:38I've also heard you say, CFO Beery, that you do not have the human capacity to meet council's expectations at the current time.

2:40:45I don't know that the council can give you everything that you need, but I don't 100% know what that would be, and I'd like to work to get you more of it.

2:40:54And that applies as well to City Budget Office.

2:40:56So my question is, what human resource or capacity do you need in order to make sure that we are making the changes necessary to effectively track our funds and meet the expectations of City Council?

2:41:08Yeah, Councilor, thank you for the question.

2:41:10I don't have a number to provide you.

2:41:13You know, frankly, recognizing the constrained budget environment, that wasn't work that I prepared to present in an ad package.

2:41:22Certainly there are things in motion.

2:41:24Many of the things we've discussed today, organizational realignment and kind of corrective reporting expectations that will help mitigate that.

2:41:36There's 2 ends to this question, right?

2:41:38One is the number of humans to catch the work.

2:41:41The other end is kind of the volume and expectations about performance of that work.

2:41:46And so I can— happy to work with you to come up with a more firm numerical representation of what that expectation might be.

2:41:56But I think there are some things we can do organizationally to help create a little more space and bandwidth to prioritize the things that are high value and maybe deprioritize some of the things that are high effort and lower value.

2:42:08And that would be an immediate action that we could take collectively to help produce a little bit of bandwidth.

2:42:14Yeah, I appreciate that.

2:42:15And that leads me to the thought that there is a structural gap in us not being able directly at the moment to Yes.

2:42:23—To ask for those add packages some years when the overall constraint— because there's going to be times in a cut year where you still have to invest in some parts of the administration, and there's going to be times in an add year where we still want to cut.

2:42:35But the overall piece is something I'd like to talk about so that we're not only talking about council expectations needing to change— that's a part of the solution— but also about the capacity.

2:42:45The other point I want to make is something we've said several times from Yes.

2:42:49I've come up at this dais in other contexts around the budget, which is the simple idea that if it's good enough for one elected leader in our government to receive the information, then with some logistical timeframe built in for the, the fact that we are 12 of us and it is difficult to get us all in the same place sometimes in the right setting, attorney-client privilege setting or whatever, but if it is good enough there, it is good enough for all 14 of the elected officials.

2:43:14That's my opinion that I've expressed several times from this dais.

2:43:17I stand by it and I think that what I've heard here is that there is a move towards that direction, but I don't know that that exact destination has been stated, um, on the record.

2:43:26So I just wanted to restate it for myself.

2:43:29Um, and that is just about my time, so I will go back to the queue and pass to Councilor Zimmerman and then Councilor Green, and then we'll probably be wrapping up unless anyone else gets in the queue.

2:43:39Thanks.

2:43:40Uh, thank you.

2:43:41I think I have some 4 minutes left.

2:43:43I, I just think it's clear to me today after I think that what we've seen under, you know, this process, as well as the report that CA Lee has referenced and other reports that we've seen, that this has just been a failure to properly disclose and budget is both a system failure, but also there are some personal failures to certain mid- to high-ranking Portland Housing Bureau employees.

2:44:06I think that Jonas's deep dive with the employees to frankly unearth Other areas of unbudgeted, we'll call them reserves, is commendable.

2:44:15And I really appreciate you doing that deep dive.

2:44:17I think leaders go to the point of friction, and this was a point of friction, and you dove in.

2:44:22To Michael Bonocore, our interim director, I just very much appreciate that within the first days of taking the helm, you began to kind of right the ship.

2:44:34You— your instinct to notify the DCA and others Thank you.

2:44:40And I bring that up because, in fact, at the director level, that instinct is actually a professional expectation, and that the lack of that instinct would actually be a point of professional failing, and in my words, the reason for cause termination.

2:45:00Directors have instinct that we ask you to To use, and you did that.

2:45:06So thank you for staying with us.

2:45:08Thank you for, for righting the ship a bit.

2:45:12And I understand that the former director was separated with a no-cause provision, and that's the administration's purview.

2:45:18I won't question that.

2:45:19That's your prerogative.

2:45:21But Mr. Bonaccor, as the interim director, I just want to be clear that there are more people in the organization and others who need either significantly more training and development to no longer violate Oregon budget laws, or who don't possess that professional instinct to continue in their role.

2:45:44And I want to say very clearly, you have my full support in the direction that you want to go, to either invest time in that, in that redevelopment and that training, or to clean house as you see fit.

2:45:55So I appreciate everybody who has stepped to right a ship that frankly was not being transparent.

2:46:03Last year it was a different bureau.

2:46:05This year it's this bureau.

2:46:06I wonder how far it goes.

2:46:08And so for those who are certainly tuning in, if you work in finance and budget, I deeply hope, and I will say it again, I deeply hope you consider just how dashed or solid that line of reporting is to the Central Budget Office, to the Central Finance Office, And how important it is that you understand that all bureaus work for the mayor and the city administrator, and there is no obscuring of funds.

2:46:31There is no not reporting of money.

2:46:32All funds, to Councilor Smith's point, all pennies in this account shall be determined clear and transparently.

2:46:39So thank you for those who stepped in.

2:46:41This has been an odd several months.

2:46:44I never thought when I asked a simple question in July about where does the RSO fund go and what has it achieved, that this would turn into such a cascade, but it certainly has.

2:46:54And there are a lot of reasons for that.

2:46:56But for those of you who had the professional instinct to do the right thing, thank you for taking the time to make that clear.

2:47:02Thank you for unearthing additional funds.

2:47:05And my appreciation to you exists.

2:47:08Thank you.

2:47:10Thank you, Councilor Zimmerman.

2:47:11Councilor Green, and then we'll start the process of closing it out.

2:47:14Yeah, so I don't actually have any further questions.

2:47:16I'm in the queue.

2:47:18If there's a part of your hearing that has a general discussion piece among council, that's what this is for?

2:47:24Just go right into it?

2:47:25Okay, great.

2:47:26Thanks for everyone for taking the time to answer my questions today.

2:47:28I know this has been a difficult several hours, and I appreciate your partnership in helping us grow as a city.

2:47:35I think what we've learned here today is that a whole lot of folks in the city knew for months about funds that could have been used in the TAO, but that information was not shared with council.

2:47:43That's correct.

2:47:44Specific recommendations were made by the CPO and by the head of the Housing Bureau that these funds could be used in the TAL, but those recommendations never made it to us.

2:47:55And as a result, we made critical budget decisions that might have been very different had we been given the full picture.

2:48:01And that is a real problem.

2:48:02And we've all talked about and acknowledged that we've got to fix that.

2:48:06So I think to the extent that there is any kind of closure on this oversight, hearing, it's the acknowledgment that there is work to do.

2:48:15So I think that's a win.

2:48:17But I do want to push back on one thing that I've heard today up at the dais, not from anyone out there, is this idea that there were no practical consequences to delaying disclosure until after the TAO.

2:48:30Colleagues, we learned about the presence of this money and the city learned about the presence of this money through reporting.

2:48:36That said, whoops, we found $21 million that's just hidden.

2:48:43And because of that, we never had an opportunity as a body, as a collective government, to discuss whether it was hidden, whether it was an accounting problem, whether it was something that we wanted to try to address on a programmatic level.

2:48:57And we had the loss of public trust because of it.

2:49:00So there was consequence.

2:49:01I think there was significant consequence to that.

2:49:02Councilor Smith, you had a question?

2:49:05And I think the decisions that we made in the TAO could have been different with regards to how we hedged our risk going into spring.

2:49:12Now that ship has sailed.

2:49:14We're going to do it better next time.

2:49:15I'm pretty confident in that.

2:49:18But one of the things that I've heard through this discussion is that structurally there is a line of reporting from the CBO up through the city administrative office.

2:49:29Yes.

2:49:30And that's— so I actually have a question for the City Attorney.

2:49:34In the charter, I understand that it grants the mayor the duty and the right to propose the budget.

2:49:41It's the mayor's obligation to propose the budget.

2:49:45I don't see in the charter that the CBO is required to be nested under the mayor and whether or not a different structure exists and whether or not council can have direct access to the budget.

2:49:56I think that's a good question.

2:49:59Could you give me a little bit of understanding on that?

2:50:01Yeah, great question.

2:50:02Thank you.

2:50:03Robert Taylor, City Attorney.

2:50:07The budget director is a position that is expressly called out in the charter.

2:50:13It is under Section 2-406.

2:50:24And that's the portion of the charter that outlines the duties of the city administrator.

2:50:31It says the city administrator shall control and administer the financial affairs of the city.

2:50:37The administrator may appoint a budget director to act under the administrator's direction.

2:50:44So that's the portion of the charter that assigns the budget director Under the administrator.

2:50:51The administrator is under the mayor.

2:50:53Okay.

2:50:55And there is also a city code provision around the budget office, what their duties are, and how they're supposed to provide information.

2:51:08And in there, it talks about the budget office having responsibility to give information to the mayor and the administrator and And I think that is what Budget Director Levine was trying to express, that structurally she reports up to the administrator and the mayor.

2:51:28And there's this code provision and, you know, this understanding that she needs to work with you as the body.

2:51:36And Administrator Lee was explaining his expectation for how all of that should work in terms of communications with you and sharing information.

2:51:47That's very helpful.

2:51:48I appreciate that answer.

2:51:51So my understanding is that what's not explicitly spelled out in the charter is clarified in code as to then how the CBO performs the function envisioned in the charter.

2:52:03And then, so then if there's opportunities to change this and clarify, I think this council would have an opportunity in the code to adjust the responsibilities of the budget office.

2:52:19It needs to be consistent with the charter, but I do think the charter is clear on the reporting structure.

2:52:28But in terms of the duties, I think there is some ability for the council to legislate in that area.

2:52:33Councilor Herbold, Okay, thank you.

2:52:34I appreciate that.

2:52:35And colleagues, thanks for your participation in this today.

2:52:37I think I'm done.

2:52:40So thanks so much, Mr. Mayor.

2:52:42Thanks so much, Mr. City Administrator.

2:52:45Thank you.

2:52:46I see as you've been speaking, Councilor Green, that Councilor Smith and Novick have gotten in the queue.

2:52:49We've got enough time for each to have a couple minutes, so I'll do that.

2:52:53If anyone else wants to get in the queue, now is your last chance.

2:52:56So Councilor Smith and then Novick.

2:52:58Thank you, Mr. Chairman.

2:53:00City Attorney Taylor, you talked about what was in code and the direction that it gives for the budget director.

2:53:09Now, when was that code— doesn't the charter supersede the code?

2:53:14When was that code written?

2:53:17It is correct that the charter supersedes the code, and that code That code's been around for a while.

2:53:29It existed in the previous form of the law.

2:53:31Like 20, 30 years?

2:53:34I don't know if it is quite that long.

2:53:36I think I'll try to do the history lesson.

2:53:40I guess where I'm trying to go is that that code is what it is.

2:53:45It is a code, and as many have said here about this today, Hearing, it is a relic of the past that got us to today.

2:53:56So basically what we should be looking at is what is in charter, not what is in code, because the charter supersedes that, as you just said.

2:54:07And so unless you change the charter, you cannot change what the city budget director does in code.

2:54:16Thank you.

2:54:17You cannot do in code something that is inconsistent with the charter.

2:54:24The charter will often provide broad principles, and then code is there to fill that out, provide more details, and the code needs to be consistent with the charter.

2:54:40In terms of the budget office, I think it's an interesting conversation.

2:54:44I think historically it reported to the mayor.

2:54:47And under the old form of government, that caused friction with the other members of council who felt they did not have the same access to the budget office that the mayor did.

2:54:58And then I believe this code was adopted many, many years ago by the prior form of government.

2:55:03Right.

2:55:04And the intent of that was to try to give other councilors more access.

2:55:11Okay.

2:55:12And then when the charter was changed for this new form of government, this code provision was updated like many, many, many other parts of the code to try to reflect the new form of government.

2:55:26And this code provision, like any other code provision, this council can change, can legislate, as long as it's consistent with what's in the charter.

2:55:35Right.

2:55:35And the charter says that the budget director reports up to the administrator and the mayor.

2:55:41And I'm good with that, and I'm good with the direction that, um, that our budget office, uh, gave us, that they also want to give us information as well.

2:55:51And I think this comes down to an information gap.

2:55:54What I found here was an information gap.

2:55:56And if we, if we find out months later about monies that were, um, known about And they were not reported in our previous fiscal year.

2:56:09And now we're, you know, we're going on to another fiscal year.

2:56:13It, um, it gets dicey for us because we are the policymakers.

2:56:18And then when a TAO comes out that has policy decisions in the TAO that have been created by the budget office, they don't create policy.

2:56:28They should let us know, let us write the policy.

2:56:30I agree.

2:56:31And say, this is where we want to go.

2:56:32So, but we're getting policy direction from the budget office, and that's not what they said.

2:56:38And so that direction either has to come because in the charter, the mayor can drop policy.

2:56:46So I think where we're experiencing some difficulties up here is just about where we get the information.

2:56:55And legally, How we get the information.

2:56:59I don't know how you legislate that, but that's a— that seems to be a common theme.

2:57:04Yeah, thank you.

2:57:05I would agree with that.

2:57:07And there was reference among council today about the other provision of the charter that the administrator has the responsibility to keep the council fully informed of the financial affairs of the city.

2:57:21And that is in the charter.

2:57:23And I think that is a lot of what this conversation has been about from council and from the administration in terms of when do we expect to get the information?

2:57:35How fully baked do we expect the information to be before we get it?

2:57:42When is our level of confidence in the information that we feel like we can even share it, that it's reliable or semi-reliable?

2:57:50And I think that is the conversation that has been very helpful today to have.

2:57:55And I think that is a reason why this hearing is appropriate to try to carry out that charter provision of making sure council can be fully informed.

2:58:08Thank you, Attorney Taylor.

2:58:08Thank you, Councilor Smith.

2:58:09Councilor Novick, about 3 minutes.

2:58:12Sorry.

2:58:12In response to Councilor Green's comment, I just want to say that I don't think I don't think that either Councilor Pirtle-Guiney or I said that there were no consequences from this information not being known earlier.

2:58:23I think that we said that we don't think that there were policy or financial consequences.

2:58:28Obviously, it was not a good thing for there to be a bunch of news stories saying that the city had miraculously found a bunch of money that was somehow hidden under the couch cushions.

2:58:37Those were not good stories.

2:58:39I did also want to say that after we knew about the money, it took this council nearly 4 months to decide how to spend it.

2:58:45I think that's right.

2:58:45It.

2:58:46I'm not saying that that's bad.

2:58:48Um, I think that it's better to spend money thoughtfully than to spend it quickly.

2:58:51But I do not think that if we had found out about this money on, say, October 20th, we would have figured out what to do with it by the time of the fall TAO.

2:59:01Thank you, Councilor Novick.

2:59:02So, um, I'm going to start the process of closing out, but first I want to take the opportunity to thank, uh, everyone who was here for the administration.

2:59:10Uh, Deputy Director Gonzalez, I don't think we I never even called you up, but thank you for being here.

2:59:14I appreciate it.

2:59:15Um, City Administrator Lee, and I, I think it's worth pointing out, uh, for those who weren't tracking, that, that all this happened before City Administrator Lee started.

2:59:23Um, so if you didn't know, now you know.

2:59:25Um, CFO Beery, thank you for being here and answering questions.

2:59:29Uh, City Deputy City Administrator Oliveira, thank you for being here, as well as Housing Director Bonaccor.

2:59:34I specifically want to thank the mayor, uh, for coming and, and, uh, taking time out of his day for being, for being here.

2:59:40And, and just on a personal note, every time we see, uh, Ruth Levine, the director of the City Budget Office, I, I am really impressed over and over again doing the right thing, um, and, and having the, the initiative to do so.

2:59:52So I, I want to just add that as well.

2:59:55Um, we kind of set aside a couple minutes here to talk about what did we learn.

2:59:59I don't know that that's really something that needs a separate conversation.

3:00:03I think that's for all of us to consider as we move into the next step, but just a, a question to pose to all of us as we think about the next hearing.

3:00:10Because I, I do want to thank everyone for approaching today with seriousness and with decorum.

3:00:14I do agree with Councilor Green's comment earlier that ideally oversight is routine and boring, and I intend, um, that this won't be the last oversight hearing we ever have.

3:00:23The next step for this particular process, um, is up to the, the council president.

3:00:28Under the resolution, the council president may schedule More, and I'll be working with the committee, the whole vice chairs, and the council president to determine what the next steps are for this or any other oversight hearings on a regular cadence in terms of how we schedule it for this body on various topics of interest to the full council, including but not limited to this topic.

3:00:48So, and I think ideally these hearings are not in reaction to any particular incident or revelation, but part of our regular book of business.

3:00:57So, uh, with that, um, I will adjourn the meeting of the Committee of the Whole in this oversight hearing at 12:26 PM.

3:01:04Thank you, everybody.