The record · Transcript

Council session — 2026-04-23

Transcript from the session's official auto-captions (26,649 words), shown in readable case and split into speaker turns. Speakers are AI-suggested and editor-reviewed (low confidence — auto-captions garble names); each color marks a speaker.

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Good morning. I call the meeting of the committee to hold to order. It is Thursday, April 23rd at 9:32 a.m. Diana, will you please call the roll?

Good morning everyone.

Pirtle-guiney.

Here. Ryan. Here. Koyama Lane. Morillo here. Novick.

Here.

Clerk.

Green here.

Zimmerman. Avalos. Present. Smith. Here. Dunphy. Here.

Here. Christopher, will you please read the statement of conduct?

Welcome to the meeting of the finance and governance committee of the whole. To testify before this committee in person or virtually. You must sign up in advance the committee agenda at www.Portland.gov/council/agendae or by calling 311. Information on engaging with the committee can be found at this link. Registration. Virtual testimony closes one hour prior to the meeting in person. Testifiers must sign up before the agenda item is heard. If public testimony will be taken on an item, individuals may testify for three minutes unless the chair states otherwise, your microphone will be muted. When your time is over, the chair preserves order disruptive, disruptive 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. If you cause a disruption, a warning will be given. Further disruption will result in ejection from the meeting. Anyone who fails to leave once ejected is subject to arrest for trespass. Additionally, the committee may take a short recess and reconvene virtually. Thank you.

Thank you christopher. In a moment, I'm going to pass it over to council president Dunphy for a couple introductory comments. But I wanted to first say welcome to the third meeting of the committee of the whole. This is a little different than the previous two. And frankly, anything we've done in the last 15 months and perhaps for many years before that, and that this will be an oversight hearing, we're going to spend some time explaining what happens before we get into it. But please bear with us as we test out a new process. And with that, council president Dunphy says he's good. So, all right, today's an important day for us as a body and for portland's new form of government. Today, the council is holding its first oversight hearing, exercising for the first time, an authority granted to us in portland's new charter. I 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. Whether you share 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. It's a great honor for me to chair this first oversight hearing. I've taken great care to work with the council president's office to prepare a format to today that I hope will foster respectful discourse, public trust and transparency. Oversight is critical to good governance. It's our duty to carry out this responsibility without fear or favor. We'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. Oversight and accountability are not the same as punishment and blame. The purpose of oversight is to improve efficiency and effectiveness and transparency of government operations, evaluate performance, performance and programs, detect and prevent waste and unlawful conduct, and ensure executive policies reflect the public interest. And we can do all of this respectfully. As a result, I'll be strictly enforcing our rules related to order and decorum today. Oversight 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. And in that spirit, I'll highlight three of the council rules specifically before we begin. The first is councilors should confine themselves to the question under debate. This means keeping comments within the scope of the four questions in the oversight resolution passed by council. This 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. Secondly, councilors should refrain from personal criticism. This applies to fellow counselors as well as the members of the administration who are invited to be here today. We sent out a writ of show with the seven members of the administration who will be present today. We can make our points without attacking and shaming each other. And finally, each councilor will have ten minutes during q&a to ask questions of invited guests. Each councilors time includes response time. So I'm asking our invited guests to please answer questions as succinctly as possible. And 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. But if there is time remaining after each councilor has had their opportunity, I'll return to councilors in the queue. I'm actually. I should have had diana read the item first, so I'm going to pause here and let her do that. Diana, would you please read the first item?

Item number one. Document number 2026-140. Oversight hearing on unbudgeted. Portland housing bureau funds.

Great. Any questions on the rules that I just laid out before we get started? Any objection to that run of show as well? Yes. Please feel free.

This is a unique situation. I'm a little bit surprised, chair, that we don't have an attorney with us on the dais. I think that that would be most appropriate.

Yeah. I see robert taylor's hand going up. Okay. Thank you, counselor Zimmerman. Does that address the concern?

Yes. Thank you.

Thank you counselor. Anything else from anyone before we get going? All right. Councilor. Pirtle-guiney.

Thank you, chair with an attorney coming up here, I, I appreciate that you're going to hold us all to a standard of decorum and professionalism during our conversation today. I think that's really important. I 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. So 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.

Thank you for that reminder, councilor Pirtle-guiney, and 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 we'll let us know. We welcome that. All right. Well, with that, I'm going to 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. So take these as suggestions. This is the first hearing. We only have a limited time, so I'd suggest as a as a first understanding accepting non-closure, we will probably not answer every question that there is in this time. We talked about treating others with respect. And the third thing I'd say is stepping up and stepping back. And that means ensuring that your colleagues, but also the subject matter experts have the opportunity to give their time, but taking yours as well and just understanding and being aware of that balance as we go forward with that, I'm going to pass it over to city administrator lee for any introductory comments he may have, and then over to the the resolution sponsors.

Thank you, committee chair and vice chair and both vice chairs for this committee. Thank you this morning for having us. You 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 the 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, and 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. They have my trust from that standpoint, and they have my support as we continue to provide services to this city. Yesterday evening, we provided a report that under attorney client privilege, as it relates to my investigation of this matter, as well as previously 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. I believe everyone on this council has that information. I 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. But I just hope that with this additional information, it gives you even more insight and ability to ask even more informed questions as it relates to the matter that we have at hand. I appreciate the opportunity, and 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. So thank you.

Thank you, administrator lee, and our final introductory comment before we get to each councilors ten minutes is from councilor Green, who is the sponsor of the resolution that set this up.

Thank you. Councilor Kanal. I just want to frame this up by saying that oversight is not about gotchas. It's not about blaming. It's not about sort of badmouthing any bureau or any given employee. It's about making sure that we are always fulfilling the public trust. And so that's the kind of energy that I'm trying to bring to this conversation today. I appreciated your earlier framing remarks about these kind of community agreements. I, I think if we do over 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, our constituents know that the city council is, is going to do its job, which is a very which is very explicitly about making sure that we are that we are willing to do oversight to follow up on the legislative prerogatives that we have. And that's how that's how we've structured this new form of government. We are not executives, we are legislators. And so when we legislate and create laws, there needs to be a way for us to say, did we fulfill on that legislative promise? So just to set the context here in the original resolution, we noted that in August 8th of last year, council was notified by then city administrator jordan that due to a $12 million underrun and expected business license tax collections, we should expect as council to take an action to close that deficit in the fall tor. And around that same time, then-fbi director hysteric informed dca oliveira of a previously unbudgeted $12 million. So that's the same number. It's the same magnitude in rental services, offices, funds. And that money was never included as part of the tor. And this is all in the resolution that guides this oversight hearing. So today I'll be asking questions. My councilors, fellow counselors will be asking questions to figure out why that money was not part of that tor. And 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 that that gap there. So to this end, the oversight resolution that provided this hearing generated some public records. My my team has compiled some of those public records. We've made it available to all of you. So you have the same information that I'm going to be referencing during this conversation when I ask my questions. And again, I can't stress enough that I'm coming into this with good faith. I'm just trying to ask questions in public and not lead to any consequence or any sort of outcome there. So that's sort of my opening remarks and context setting. And would you like me to begin the questioning?

Just one thing I forgot to mention. I mentioned there were seven 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. We have city administrator lee, we have cfo biery. We have cbo. Director levine dca oliveira, housing director, housing deputy director gonzalez, as well as mayor wilson. I appreciate everyone being here. And with that, we'll start the clocks. Feel free to to start it off, councilor Green.

Mitch Green: Thank you. Councilor Kanal to begin my questioning dca oliveira, can you please come to the dais? Set my stopwatch here. Can you please introduce yourself for the record? Donnie oliveira. Excuse me. Donnie oliveira for the record. Thank you. Donnie. My first question is on what date were you first made aware of the unbudgeted. So funds. Just one second. Councilor sorry for using your time here to get my. Councilor the first time to my best. My recollection was a one on one check I had with director historic where she gave me a heads up that there was some unbudgeted funds and that would have been either late July or early August. The exact date of the check in is off the top of my head. Not clear, but it was around late July, early August, late July, early August. And that that aligns with the the timeline slideshow that came from your office to kind of catalog that as well. Just noting that for the record, my second question is on August 27th. And if you're following along, that's page six. In this packet, director hissrich emailed you notification of like more formally of unbudgeted funds, along with recommendations for how they could be allocated. That August 27th email included the following statement. This expenditure, and I quote this expenditure plan will need to be approved by council in the fall bump, end quote. So that is now called the fall tore. Why was this money not included in the fall town? Thank you for the question, councilor. So to the best of my recollection, they director at the time sent that email. It was, I believe it was the end of the week. It was the next week that the town was was due. There was a timing issue. And so it just so happened that she went on vacation appropriately well earned. So her and I didn't get a chance to actually talk about the memo until after she got back and we scheduled time to do it. So from the day I got the memo from our ability to actually talk about it, the deadline for the submission had passed. And at that point we started doing more evaluation of the of the information. And there was a meeting scheduled to do that with her team.

Okay. Thank you. But but you did first learn about an approximate level of funds in late July.

Not not a particular number at that time, but I was, you know, at that point, generally aware of something. You know, there was a discrepancy in the budget.

Okay. Thank you. And so between the date you were first verbally informed and August 27th, we 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?

And none to my recollection, councilor, it was at that point premature. I hadn't received anything official yet.

Okay. Thank you. My next question is, was anyone in the administration made aware of these funds prior to the tor? If so, who were they? When were they made aware and why were they made aware?

Well, councilor, the tor is a lengthy process. So people are learning in the middle of the process. So I guess to say, who learned before the submission that the first deadline of submission, which I believe was the fifth dates, to be clear, that's when service areas were the proposals were due. I don't believe anybody at that point knew before this submission. It was during check ins that I had with the city administrator at the time, michael jordan, that, again, I gave him a pretty high level. I think there's some there's some funds in the bureau. We don't have definitive details yet. We're going to work on that.

Okay. So I just want to go back a little bit in that August 27th email, there's an identification of $12 million of funds and a spending plan. And you didn't. So I just want to make sure you weren't talking about that in the context of the tor when after you received that spending plan with with anyone else involved in the construction process.

Not that, not that, not to my recollection, councilor.

Okay. Thank you. My next question is when you briefed the mayor, city administrator jordan and cfo beary in early September. And this is drawn from a response that I think I think cody bowman provided to a records request from the mercury in December, is the date is the timeline that you said that you had told the mayor, ca jordan and cfo biery it was around early September and chose not to brief council at that same time. What was your basis for precluding that the city administrators duty under section two dash 406 k was being met. That 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.

And thank you for the question, councilor. At that particular time, again, I had had a chance to talk to helmy director hissrich, about the memo. She was on vacation, so it wasn't until she got back that the submission already happened. It felt premature to share any information because her and I hadn't had a chance. And in fact, the the briefing we set up on September, I think the right date, September 18th with her and her leadership team, was to, in fact, go through the memo for the first time. So it was at that time that we decided to that decided that's when we started to unpack the resources where they were at, etc. And so just from a practicality perspective, I gave the mayor, cfo biery and jordan a heads up that there was some discrepancies, but that we were still evaluating the true, the true nature. There was general, you know, concern about the accuracy at that point. So we wanted to do some more work.

Okay. Thank you. The 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. That's the same day as and in fact, less than an hour before the second reading and passage of the tau who made the decision to inform council on this specific day and why it.

So 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. At this time it was about 11.7. The mayor thought it was appropriate. At that point, we felt confident to say, okay, we've confirmed this particular tranche of money. And so we actually had set up a meeting for the following week to get that scheduled. In between that time of setting, that meeting up and the meeting happening, as when we learned of the additional nine, 9 million. So it just so happened just because at that point, a new director, he informed me on the the day before that meeting happened, it's not 11.7. It's 20 million approximately. And so when we met on that that next day, that's when we shared the full amount, which we just learned.

So just, I want to make sure I understand this correctly. So 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?

We were planning to share the 12 million. And then just and then we learned there was more. So.

All right, so I still don't I don't I still don't know who made the decision to inform council on that specific date.

I believe it was the mayor. I mean, and I'm saying I believe because the invite came from his calendar.

Okay. Thank you. So I just from what I'm what I'm getting here is I'm just going to summarize. So, so you found out from helmy verbally in late July, early August of the existence of some some money that was not budgeted. There's some uncertainty around what the magnitudes are in the range of 10 to $20 million. 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 town, councilors would need to be informed. Okay. I think chair Kanal, I think that's that's all I have for now. Thank you for for answering these questions. Appreciate it.

Thank you, councilor Green. And just to clarify, so you've got a couple of minutes left. Roughly. We'll get you the exact. So you'll have that available for you later. For colleagues, you're able to use your time in chunks if you'd like, or all at once. As I put in the run of show, we're going to go with the resolution co-sponsors first. It will be councilor Avalos, then Morillo, and then I'll go in the queue. So please feel free to get in the queue as you're listening to these two colleagues, and I'll pass it over to councilor Avalos.

Candace Avalos: Okay. Thank you chair. Let me start my timer here. Thank you, councilor Green. I appreciate the context you were able to bring out in that conversation. And 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. So since I'm not there, well, I can't tell. I need jonas biery please to come up.

He's on his way up now. Councilor Avalos.

Candace Avalos: Okay. Thank you. All right. Thank you, cfo, let's start with this question. On what date were you first made aware of the unbudgeted? So funds.

Thank you councilor. For the record, jonas biery city's chief financial officer. A couple of notes about that. That question. First, timing wise, I'm I'm told and via dca oliveira dca oliveira that there was a conversation in September prior to the submittal. I don't specifically recall that conversation. However, it is very common as that work is being done, that there are outstanding questions and things that due diligence that's continuing. And so that's not in and of itself unusual that there would be a conversation about something that is evolving. And so I'm told that that conversation occurred. I don't have a record of it, but accept that that probably happened. I believe it was October 5th, Sunday evening. I was actually on vacation, October 2nd through seventh. Came back and saw that email in my inbox, which was the first. First time that really came to my knowledge. I'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. And there was a couple of different amounts that were both close to 12 million. And so there was some initial confusion on my part about which bucket that was. So I just want to acknowledge that as well.

All right. Thank you. From our records, it seems to show early September was when you knew. But I'm hearing you say October 5th. So is that to confirm when you officially knew early October, not early September.

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. I'm told that September conversation occurred. I don't deny that it occurred. It just doesn't stick in my memory. Again, 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.

Got it. All right. Let's keep going. I'm going to read a statement from an internal city talking points document on the cso funds. This is on page ten for people who are following. This is a comment regarding the city's claim that the funds were not included in the trial because of timing. The 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 taw. Donnie and I provided direction to hold off given the continued uncertainty. So let's start with, is that your comment?

That would be consistent with my recollection of that comment. Yes.

All right. So when did cbo make its recommendation to include the funds in the fall?

Taw that's a good question, councilor. I don't know specifically when that was made. It was a pretty dynamic conversation at that at that moment.

Okay. And to whom was that recommendation made and in what form?

Councilor, I don't I don't know the answer to that question. Apologies.

All right.

That you and dca oliveira quote provided direction to hold off, end quote. So can you describe that direction? When was it given and what venue and to whom?

Councilor again, I can't 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. I know there was robust dialog 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. And so not not surprised that there was discussion about holding off pending that additional due diligence.

Thank you. So just to be clear, what I'm hearing, I 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, donnie and I provided direction to hold off, given the continued uncertainty, because that's where my question is coming from. So I'm wanting to know what is that direction that was given based on what you said? So are you saying you don't recall saying the original quote or you don't recall recall the direction that you gave?

Yeah, no. Got it. Thank you for the clarification, councilor. I did specifically recommend that we not included in the fall tao, because I was, I think, rightfully concerned about the accuracy of the information that I was receiving. I was concerned that the amount that would be submitted would not be correct.

Let's keep it going. So I want to ask about another comment on that same document, page ten, 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 and or deployed in December 2025. Nofa, which was a reason that we did not include initially in the tao. I don't think we need to reference that here, but want to make sure the statement isn't inconsistent with other potential public records, end quote. So is this your comment?

That sounds consistent with an email that I sent.

Okay.

Who communicated that to you on October 9th?

Oh my gosh, I don't I don't know that counselor and I apologize. I don't have that detail handy in front of me.

Okay.

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

I'm sure that would have been based upon a conversation with with housing bureau, with dca oliveira. And again, I think I want to be cautious in in and provide a reminder to folks that I at that time also had some confusion about the buckets of money. So I want to be just transparent about the fact that in that communication, I may have been thinking about a different commitment of those dollars that was not consistent with the legal obligations around the fund.

Okay.

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

I had not I had not completed that work in advance of the full 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.

Okay.

So director October 13th, which is on page seven, proposed using the same dollars on new rent subsidies, home sharing, legal defense, and returning 2.7 million to the general fund. None of those were existing commitments or scheduled nofas, is that correct? And were you made aware of that October 13th memo?

Councilor, I don't believe I saw that formal memo at that time. I was provided that memo shortly after that discussion, I believe.

And were you aware that thp was.

Referring to these funds as uncommitted or unavailable for allocation and actively proposing allocation options?

I'm sorry, can you cut out? I just want to repeat the question. Please make sure I understand.

Yeah. So were you aware.

That php was referring to these funds as uncommitted or unavailable for allocation? And we're also actively proposing allocation options. Were you aware that that was going on in the background?

I was not necessarily aware of that. And again, the timeline is not super clear as that information, as I said, was very dynamic as we were learning and having those conversations and real time, I will say I was under the belief that as many were, that that that those funds would have been budgeted and accounted for in the budget at that time.

I only have a minute and a half. So the recommendations originally sent to dca oliveira on August 27th were subsequently revised on October 13th to include 2.5 2.75 million returned to the general fund. This is on page seven. So were you part of the efforts to help close the tao deficit with these unbudgeted? So funds councilor.

Thank you. I don't believe I was involved in that. I the memo was produced without my participation. I know there was an effort at that time to identify all possible solutions to help solve for that known gap. So I know there had been broad efforts to to identify anything that could be possible. So not surprised again, that that would have been recommended by by a bureau.

Thank you.

I have one last question for ruth. If you could come up, please. Thank you. Janice. Ruth. So. Well, I guess director levine apologies. So excited. Comments and internal city documents indicating that cbo recommended the funds be included in the fall tile. So can you confirm that that is accurate?

Yeah. Ruth levine cbo director for the record, yes. That's accurate. I did recommend that.

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

I 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 and housing. And I said, I thought I said at one point that I thought it should be included in the fall town.

My last question is, to your knowledge, was council informed that cbo had recommended inclusion and that that recommendation was overridden?

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

Sounds good. That is my time. Thank you.

Thank you, councilor Avalos. We'll go to councilor Morillo and then whoever gets in the queue first, I guess. Councilor. Morillo.

Thank you chair. Kanal. Thanks everyone for being here today. I 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. I believe my line of questioning is for dca oliveira. If you could come back up, please. Thank you.

And there's going to be a game of musical chairs here, I think a little. So maybe as you start your time, councilors, if if you want to 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.

Okay. Thank you. And if you could give me maybe a five minute time check, that'd be great. Sure. So cfo biery indicated that on October 9th, he was informed of the funds. That, quote might either be committed to an existing project and or deployed in the December 2025 nofa quote, end quote. And this may have been the reason the funds were not in the fall tor, though there is some lack of clarity on whether this refers to the funds. Was it you who communicated this to cfo biery councilor?

I don't I don't recall that specific conversation at that point, I was most. I was focused on the unpacking the r so member.

Okay, are you do you know who communicated this to cfo biery?

I don't councilor. I do for for clarity, I do recall there was some confusion about two distinct tranches of resources in the bureau being solved for. But in this particular instance, I don't know where the information was coming from. One one bucket versus the r. So dollars.

Okay. Were you aware at the time that cfo biery had been told that the funds were committed?

I'm not I don't want to speculate on what what the cfo knew at when.

Okay. At any point during between October 9th and November 20th, did you did you correct that understanding with cfo biery or think to notify city council?

Thank you for the question on this particular case. By the time we got to like November, I would say there was clarity that we were we were talking about when we spoke about the 11.7 at the time we were talking about r, so dollars when that clarity happened for him, I allow him to speak to that. When 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 I wanted. I wanted more information. I wanted to understand various elements of the use, the. There's a series of questions I was just asking for more information on. And that also was part of this question of like, what's what's actually going on with these dollars? And so, and I will acknowledge this at this point too, there was probably a communication necessary to say, hey, we found something, some discrepancy. We don't have enough detail to share. But there is some concern here in this particular fund. Okay, I acknowledge that. So we were still at that time unpacking the accuracy of the information though.

Okay. So 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, sometime between late July and mid August, you are verbally informed of the unspent funds. You can see that in pages 4 to 5 of the packet. On August 27th, director hissrich emails you a written proposal for spending the $12 million with a clear statement that from fb that quote this exponential plan will need to be approved by council in the fall bump aka the tau as it's called now. And that's on page six for folks who want the quotes. In early September, you informed mayor wilson, kay jordan and cfo biery of approximately $12 million. That's page eight. On September 19th, you told historic that the, quote ship had sailed on, including the money in the tau, and told her not to inform councilor Zimmerman of the funds. On October 13th, hissrich delivers the final revised exponential memo. After integrating comments and ideas from you and several instances that go back and forth. You can find those on page seven. On October 20th, the finance committee takes up the fall tau. On October 30th, hissrich is placed on leave. She's told she has until November 20th to accept the severance package. That's on page 12. And on November 12th, council hears the first reading of the fall tau. So by my count, over those three months, the executive branch took roughly a dozen distinct actions on these funds drafting 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 tau and instructing that a councilor Not be told. Removing the fb director and that none of those moments was. Council informed about the. So funds. I want to walk through what happened in the next seven days, beginning the day after the first reading of the tau. November 13th. Bts communications manager elliott kozak 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 fb memo that can be found on page 13 from November 14th through 16. You forwarded the October 13th memo to the mayor and his chief of staff. The mayor then directed Portland solutions director brock knapp to develop a different set of recommendations for the money. Those 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, November 17th through 18th. The new Portland solutions recommendations were exchanged between the mayor, you and interim fb director boncore, with you telling boncore that if he sees any concerns, quote I need to know today. That's on page 14 and 15th November 20th. Council adopted the fall tau. And that same day you notified the council of the full $21 million. So there are roughly 90 to 100 days between the Portland housing bureau director hissrich informing you of the money and your November 20th notification to council, which happened to be the same day as the tau was passed and the deadline for hissrich to accept her severance package. What prompted you to inform council on November 20th? Specifically, was it the tau adoption director? Hissrich severance deadline? The revelation that council would soon be made aware of the funds via an imminent public domains release? Or was it all three?

A lot to unpack there? Let me think about that for a second. There was no correlation between director hissrich status and and the information communicated as I shared the. The scheduling of the meeting happened the week before to. That was the time that was scheduled. As far as the communication around the why of then is when we had. We started to have more confidence in the number that we were working with that it was in. So it was this use of funds and this was this is what it was about. And I'm sorry, the third the third thing was the timing of the tau. The tau 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 towel to make the adjustment, as you all did with other funds was still an option. So at that point, it was getting it right was the higher priority.

Okay. Thank you. In the final seven days of a four month window, the mayor's office developed a new allocation proposal, briefed an interim director, and informed council, all in the seven days after the records release was flagged. In my count, that is more urgency on these funds in a week than in the preceding 100 days. Had 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. So funding, as is required by charter.

I'm sorry, can you repeat the question part? I got the first part, yes.

On what day were you planning on telling council about the $21 million in 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?

Thank you for the question. I think the timing was 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. October was very difficult for the bureau. There was a lot going on, and I would say that there was a. We were also in the middle of very, you know, dynamic tau. The timing of that also coincided with us having a complete picture of the resources. Almost serendipitously in this particular case. But again, the part that I acknowledge is that some some communication to council in September, October, whenever we felt like more clear what was happening was appropriate. But I stand by the reality that our confidence in the number until we shared it was was quite low. And the timing reflected our our higher confidence that when we share the information, it was accurate.

Okay, I'm getting close to the end of my time here. Did anyone instruct you to wait until November 20th before informing council?

Not to my recollection, councilor? No.

So between September, when you decided the tau was not the vehicle for sharing these funds, and November 13th, when the records request surfaced a period of roughly eight weeks or two months, was any council briefing on the funds scheduled, placed on the calendar, or committed to. In writing? Because 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?

The council would have been informed. Absolutely. Councilor once we had the the confidence and the numbers. Absolutely.

And that's time. Thanks, councilor.

Morillo thank you. Councilor Kanal.

Sameer Kanal: And 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. So if anyone would like to get into the queue and take their first crack at their ten minutes, I'd welcome it. And if those who have already gone would like to come back in, you can also put yourself in the queue. I'll just call on those who haven't gone already. Councilor Zimmerman, thank you.

The first person I'd like to talk to is donnie oliveira. My next one will be for lee. Donnie, is it true that your understanding is that the former director of the housing bureau was aware of accumulating budget or funds in budgets as early as January of 2025?

I'm aware of that information now, councilor.

Great. Mr. Lee, same question.

Same response. I'm aware of it. Now, as I sent out the $106 million memo.

So 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. Thanks. That's all.

Thank you, councilor Zimmerman. Once again, there's oh, sorry, I didn't see it. Councilor. Pirtle-guiney.

Thank you chair. You 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, there'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. And I understand that there may be some fear of bringing us information before it's baked. And 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. So what should we expect with 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.

I think coming into this role, and something that I've communicated to this body as a whole is, as I am aware of, situations that may have impact to this body in the decisions that you will be making, try to at least make you aware of the situation with a 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. Just being a professional regarding this situation varies for different people as it relates to when you communicate something, ensuring that the information that you're communicating is accurate because you don't want to backpedal from that information at a later date and say, well, sorry, I made a mistake. This is the information I have now. I think that direction has to come from this body as a whole is how they want to receive information. And 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, but to also be open, to be able to come back to you and you would be open to saying, hey, this information has changed. You 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 be become public record. So 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. Council should be aware of this information, but I'm unsure of the accuracy of that information. And 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. We may not provide exact numbers because we're unsure of those exact numbers, but at least making council aware of the situation, the challenge that we're faced with, but also providing council a time frame of when we anticipate being able to answer that question. And I think that goes to your later latter question of when should we expect to have that information. And 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. And that's what we're challenged with. That's what we're charged with doing. That's the accountability that we're holding ourselves to in this situation.

Thank you.

Thank you, councilor Pirtle-guiney. I see councilor Smith in the queue, and then if there's no one else, we'll go back to councilor Green, councilor Smith.

Loretta Smith: Thank you, mr. Chair. I have a couple of questions that I want to make sure that I get on the record, because I just got some new information. Could I add cfo biery and cbo director levine, come up, please? Good morning.

Councilor. Thank you.

And actually, I need dca oliveira up as well because I'm going to be speaking from the email exchange that we had last night. While the general explanation for how the funds that created the towel was was given, there was very little specific information. And the housing, 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 towel that was in the housing bond money. Are you familiar with that? Cfo biery.

Councilor, I'm trying to thank you. I'm trying to track that number. Are you talking about the amount that was in this most recent spring towel?

Exactly the one that we voted on last week, Wednesday. And I was asking about those funds because I wanted to identify that was a part of the bigger fund that the sos and all of this that we're talking about today. And 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. And I was concerned dca oliveira, that when I was told that there were contracts out, I didn't understand how the contracts were out 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? So then I tried to go over in my mind what that could look like, so 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? According to to director banakar. So I'm going somewhere with this. And your response yesterday was was interesting because you sent me back a excel spreadsheet. I asked you, tell me how much is owed for each project, send me the contracts. As I was told that I would get contracts, but I didn't get contracts. I got links to projects and many of these projects were like four years old, two years old, three years old. So again, I'm new to the city council. I 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 was wondering if this is a pattern and 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 and to pay an invoice for four years and then come back and say, oh, we were going to use that money for this project. So can you explain to me how we can appropriate funds when it was never authorized or appropriated in a budget?

Thank you for the question, councilor. I just will note for the public and for council, we're referring to four housing bond projects alder nine, the aurora's crescent court and hollywood hub with councilor. Smith is asking is there is $23,000,023 million in housing bond resources.

Trust fund.

I'm sorry.

It's the trust fund money.

It's their housing. It's the housing, the housing bond dollars. That's those are and those dollars were confirmed by ordinance, by council and various years going going back about 6 or 7 years. So council authorizes the bureau to use housing bond dollars specific to those projects. Three of those four projects I shared with the councilor Are already built and have people living in them. The fourth is the hollywood hub project, which you've all seen as you drive down interstate 84. That's the four project, fourth project. So the $23 million remaining are all going to those projects. And you might ask your question, councilor, how could we possibly be spending dollars from the housing bond still on projects that people are already living in? Great question. So pretty standard affordable housing deals, funders, in this case, the city of Portland, are continuing to make disbursements to projects even after they're open. And there's a variety of reasons. There's developer fee installments for the nonprofits, there's conversion costs, there's occupancy stabilization, especially for primitive supportive housing. Like many of these are. We're truing up the cost of the project. So for the three of the four, 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. The fourth project, which has about 7.7 million remaining in disbursement, is for the hollywood hub, which is still being built. So you can imagine we'll make those payments once that project is in completion. So councilor, to answer your question, it's not that we have new contracts this year. The remaining 23 million is what's owed to those projects as committed by council, in this case, your predecessors.

And if we pay for those projects, they don't necessarily have to come out of this pot of money. They could come out of general fund. They could come out of any other cdbg fund that you have. They don't have to specifically come out of this pot. Correct.

There are there are scenarios where we could replace resources. I would caveat that housing bond dollars have specific restrictions. So if you do that, you'd still have to honor the intent of the bond dollars with a new project in this particular case, because these projects have already the three of the four are already built. We are in the final payments of these projects to try to do budget machinations now would probably not be best practice. It's possible, but those bond dollars are very explicitly allocated to those projects.

Thank you. That was a very good explanation. So here comes my last question. I'm looking at the $7.7 million. It's supposed to be disbursed during fiscal year 2627. And since our 2627 budget has not been approved, this $7.7 million can be spent other places as well, because it is not appropriated or contracted out. And you would actually, if we did, appropriate those $7.7 million, you would have to find another place to fund last installment. Correct, because there must be a balance in that account. Looking at your spreadsheet.

Thank you for the question, counselor. It's a balance, but the target is due to the project. So 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.

You would just take it from a different pot. You could take it from cdbg, you could take it from general fund, you could take it from other places. And in fact, you could actually take it from the reserve fund.

Councilor. Then you can pause the timer. I just want to understand how this relates to the 20.7.

This is a part of the. 20. This is a. This. It expanded from 20 to 40 to 106 to 145. This is a part of that whole money that was hidden. So the question is, if I want it to appropriate the 2.2 million that I requested, it could actually come out of here because it didn't get appropriated for 2526. You have it on your balance sheet as being dispersed during 2627 and you have a balance. So there's a balance there. I just want to just recognize that you have a balance in that account.

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

Thank you. So I just want 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. I appreciate you giving me that information. That's why I sent it to you last night, because I wanted to take a look at it, and I wanted to make sure and the reason why I'm asking ruth and jonas to come up because is that a pattern and a practice for us to have balances, but actually say that all the money has been appropriated is do we normally do that?

I'm not fully tracking what the balance is, having just just seen it in my inbox this morning. But 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. That is just how the aquifer is built. That's how that that's true in all governments. And and it can be appropriated in the next fiscal year as beginning fund balance. And 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 to the next fiscal year. We 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. And that is a projection that ought to be then trued up once we have the actual ending fund balance. But that's a general description of how it works.

And last question, ruth, can council appropriate that balance before the fiscal year is over to a project for 2526?

I guess I think I'm tracking the question is if if you expect there to be unspent dollars in the current fiscal year.

No, no. Right now, if we put an ordinance in, there's a balance in that account. It says it's 8.2 million. Can we do an ordinance next week to take some of those dollars from that account? There's a balance there.

Again, assuming that it's legally that it's compliant legally with the intended uses of the restricted use.

Thank you. That's what I wanted to find out. Thank you.

Thank you councilor. So we let that go just a little over. But thanks for answering the question there. Next in the queue is councilor Green followed by councilor Zimmerman. I'll also just note really quick that the first stopping point we have, after about 1045, we're going to take a short break recess and come back. So, councilor Green, you have about a minute and a half left.

Thank you. Dca oliveira my question my follow up question is for you. Thank you. You indicated that the decision was made by the mayor to inform council once the precise number, $11,750,000 was known, with some confidence, that decision was made about a week prior to informing council on November 20th. Right. Is that correct?

I, I believe so, counselor. I think that's that's accurate.

Thank you. This number, $11,750,000 is the same number that was in director hystrix 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. So this number did not change over those iterations. What did change was the internal recommendations for how to spend that money developed by Portland solutions over a weekend at the mayor's direction, did you instruct at any time before that? Did you instruct director to identify a way to close the deficit with the money council?

There was definitely a we had a there was two conversations that are happening in parallel. There was a broader conversation we were having as as a city more broadly. So just specific to my service area where we were aware of the general fund deficit. And so we were contemplating ways to reduce spending, their hiring freezes reduction, ems spending, etc. Right. So we're looking at the that. So there was a conversation about how to reduce as a as a service area, do our part to, to close that gap. Thank you. As we were evaluating those potential. So dollars after we had the September 18th meeting, I asked the team to say what was, what was legally inbounds with so and so. They, they contemplated a variety of things. And, and the director did contribute a recommendation for a general return to general fund as an, as an option.

And that's what I see. That's what I see in the October 13th communication that says per per instructions. Here's a revised plan for general fund return x, y and z.

Thank you and councilor. Yeah. Okay. Okay. Sorry, I was going to because I thanks.

Councilor Zimmerman.

Eric Zimmerman: Yeah. If we could have the finance staff please come up. Budget staff. Thank you. So. You know, in theory, right. Council can appropriate funds to be executed in a given year, but we also appropriate reserve funds. I'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 funds within a all, all, all money within a fund in order to make those determinations. Again, I'm getting a nod. So 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?

Thank you. Counselor asked the question. It is counsel should be, and I believe, with maybe one rare exception that we've been discussing for the last few months, made aware of that those fund balances are appropriated in the budget. Often there's a line called contingency, which is that amount.

Great. Thank you. I appreciate that. I'm I'm wondering if. In your best estimation, why director historic, 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. But. Would council be able to make such a determination about the right size of appropriating funds for execution and the appropriation appropriate size for reserve? If we don't know about what is being recommended in reserve, if we are not made aware of that entire fund, do you have a best estimation for why she approached this decision package that way?

Councilor, I can't speculate on on on that.

Okay. Is 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 because I'm I'm only aware of a memo that discussed the. 12.

Yeah, councilor, thank you for that. I am not aware of a communication. I'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, I certainly wasn't aware of anything prior to that October date that we've previously discussed.

Ruth is the budget director. If you had a, an office, a department, anybody that came to you and they said, we want 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?

I can just say I would recommend that they budget the full amount, which is what I did.

And 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.

Correct.

Okay. So. To your best knowledge, though, you don't have a reason a, a 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. Nothing has surfaced in terms of the why behind that other than it just didn't happen. Either one of you. Yeah, okay, I appreciate it. You know, this this has been been challenging in terms of I really appreciate the questions about due diligence and having good facts before we go. And I am hearing, I think through through all of these conversations today from multiple staff who have 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. So thanks again for both coming up. That's all chair councilor.

Thank you, councilor Zimmerman. Next in the queue is Dunphy. Then we'll take the break.

Thank you.

Jonas and ruth, please come back. Sorry. Thank you. You know, colleagues, when I when I read this, when I read through these documents, 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. The housing bureau trying to come up with a plan for the dollars before publicly discussing them, the d, c, a s 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. It 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 its 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. You 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 five times larger than we had learned. We had heard that there might be more found, but I was not truly prepared for that magnitude. And so my staffer immediately called me. We got on the phone with the city administrator. Legislation on the housing dollars was already pending. And I decided that at that moment, even with incomplete information, I had a responsibility to let my colleagues on the city council know. So I called everybody personally over that weekend to 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. And that information immediately was leaked to the press with substantial inaccuracies and misrepresentations. 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. But I still think that being direct and upfront is obviously always the right way to go. We 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. So whatever else is true to the two of you, it is obvious that there are structural problems with independent budgeting inside of bureaus. What has your team changed in terms of what Portland housing bureau's budgeting practices are as a result of this process?

Yeah, thank you, councilor, for the question and the observation. A couple of thoughts and response to that. As we've talked in this room multiple times over the last 18, almost months, this organization is undergoing a fundamental structural change. And that's very, very, very messy to unwind decades of legacy practices. So that's the first note that I will make. Again, that work continues and will continue for many, many months. It will continue to be messy. Even if we were perfect, it would be messy. So that's true and will remain true. The second observation is, yes, this has been an important moment to highlight some of those deficiencies and reinforce those gaps. 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, this clear identification of reserves and contingencies, as council is 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, and we're realigning the

The organization to have a little clearer lines of reporting to the city budget office and to myself. Lastly, as we've said before, we do not have human capacity to catch council expectations, and 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. Thank you.

Thank you very much.

As that process is working to, to, to rightsize our system in this new form of government, are there is there a unified budgeting process and methodology across all bureaus that we're going to be working to implement?

Yes. Thanks for the question, councilor. Yeah. I mean, it's a it's a multi year effort for sure. We've already, as jonas mentioned, made some structural changes to collaborate more, much more closely with the finance managers and the 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. But and, you know, working on communicating all of that again, through the budget manual, through trainings and, 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. You know, I think this 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. And so there's very much one way to go through the budget. I think it's just a matter of getting everybody up to speed. And as things have been changing, you know, obviously charter reform and and getting everybody in the positions, it's been challenging to get everybody to to have a consistency so that people know what the practices are. And then we can roll out trainings to ensure that every single budget analyst in the city is aware of all those practices. So we're on that path. I think it's going to take another few years, honestly, to fully get us there. And the human capacity constraint is, is very real.

So to sort of building on what you said, you know, as we are, we are also now going through the budget process. My team has been digging into the line items on the budget. And, 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. So a lot of times it's obvious that you that your team does not have direct access to be able to even see what is happening within the bureaus right now across the city, how deep into into the program level does cbo have the ability to see?

Yeah. 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. What, where we often have to turn to the bureaus to ask questions is like, what does this mean for a program? And I think some of the things that that counselors ask about often is tied to like, well, what is this program? And one of the things that I've talked about in other council meetings is trying to do program offer budgeting more fully. And there was a resolution passed for parks with the intention to roll it out more fully. That is a path that I think will help to be able to describe that. But right now, that's not, I would say, like, we don't do that practice 100% across all bureaus. So I think that will. That's one other thing that will help. But a lot of it comes down to, you know, what's either what's the intention or how does what are the impacts operationally or like specifically, what do you do with this exact dollar? Because just because it's in a g l account for contracting, I don't know what the contract is for. I can pull the contractor's name, but that's it. So that that's where we often have to go to the bureaus.

You know it. I worked in the old form of government. I'm working in this new one. The old form of government didn't work. The voters were right to get rid of it. Obviously, we have a lot more work to do. And I appreciate, jonas, what you were saying, that that there is a clear direction that needs to happen. There 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. What and as you said, the timeline is going to be years, and we will certainly have more surprises happen. I don't believe that this is a I'm a big believer in hanlon's razor. Never attribute to malice what can be attributed to incompetence. What can this council do to help prevent this from happening in the in the near future?

Councilor, thank you for that question. I 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. So if I could make one request, that would be that would be where I would start. Thank you.

Thank you very much.

Thank you, council president Dunphy. It is 10:51 a.m. So we're going to take a break and then come back with councilor Pirtle-guiney. We'll see you back at 1101. Recess for ten minutes. All right. Thanks, everybody. We're going to return from our recess. Yeah, absolutely.

Thank you. I just have a process question. I know you said this beginning, but I need to hear it again now that we're in this new experience. So each councilor Gets ten minutes.

Yeah.

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 in.

This meeting started at 930. When does it end?

Scheduled to go till 1230. We should wrap up.

This is a three hour hearing.

Should wrap up a little before that, though.

All right.

Thank you councilor. So I'm seeing in the queue. So just just a little context here. Councilors 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. So we'll make sure that that queue gets a chance to go. Before circling back to anyone else. I see councilor Pirtle-guiney in the queue, so please feel free to to take it away.

I see councilor Ryan in the queue and he hasn't gone yet, so I want to defer if he would like and if he would like a few more minutes. I'm happy to go. Go. Okay.

Okay.

So you'll be next?

Cfo biery. 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 tor process about what's in and what's not. And when we make adjustments and that there are, I don't know if you use 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. And 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's budget.

Yeah. Councilor, thank you for the question. So, you know, every situation is often a little bit unique, right? There are some things that are very clear cut. This is a $20,000 change to this specific contract. It's clear there are things that are much more complex. This is an example of that that's much more complex. There 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. And that's problematic. Now, council has over appropriated dollars that aren't available, and that requires coming back to make that adjustment. That would be unpleasant. The other reality is knowing that in the fall tor specifically, at minimum, we have a spring tor coming up. So 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. And frankly, as council is aware, there are opportunities to make budget adjustments outside of those moments. So this wasn't a one shot and done moment in the fall. Tor from the seat I sat in and sit in. We have flexibility to be patient and do that work and provide council with an adequate level of information to make best informed decisions.

Thank you. So 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, I 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 tor 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 we'll have that other opportunity. Maybe in the future, let's make sure council knows this is out there, but we may not want to move on it yet. That'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. Is that correct?

That's correct, councilor. I mean, there are micro decisions every single day made by multiple people throughout this organization about those communication options and opportunities.

Okay. Thank you.

Thank you, councilor Pirtle-guiney councilor Ryan.

Elana Pirtle-Guiney: Thank you, chair, and thank you to the professional staff 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. And a big thanks to you, ca lee, to dca oliveira and to dca cfo. I don't know what your title is. Is it both.

I'm sorry.

Councilor dca and cfo.

Just cfo biery.

All right. Thank you. I'll do that right then. Cfo biery. For your forward facing vision to use this experience to improve the financial systems at hb and across the bureaus and offices who may still maintain siloed cultures unique to each bureau. The administration and council share great interest in this work. As we continue to go through this transition of this new form of government, and 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. Currently, practices wildly vary. I think that's what's kind of the heart of the matter here. Today's conversation is a symptom of those holdover, siloed practices. I'm not sure what new information I have learned this morning with the questions I have. I have heard asked for more than a half a year. We have experienced a preliminary investigation into the housing funds. I 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. Thank you for your transparency. As information was when it was clear you presented it to us. And I appreciate that housing funding is especially complicated. Each project has many funders from multiple government sources and private sector partners. This accounting is more complex than in some bureaus because of the variety of revenue streams. For you, dca or for sorry. Cfo biery. Restricted revenue has a has different rules than general fund revenue. As a civics lesson, can you please explain that distinction?

Thank you councilor. So right, as ruth, as ruth and others have mentioned, I think today, you know, a large majority of the city's dollars have some level of restriction. I think it's around 90% of the total budget is what's called a restricted revenue. And in general, that means there's a legal limitation on how those dollars are applied, how they're spent. A common example is water revenues. We collect water revenues. Those can only legally be spent on water related expenditures. That's a pretty clear cut example. Housing dollars are a great example. The bond dollars came up in conversation, the doc, the legal documents that create that revenue stream put restrictions on how those dollars can be expended and be compliant with the law. So there are many different buckets. I'll say sub buckets, types of restrictions that that apply to different types of funds in the city, all of which we say are restricted.

And that includes the practice of it being multi-year expenditures.

Very often those restricted buckets do do have multi-year programs. So there can be examples of restricted dollar that only has a one year expenditure. A grant, for example, might be might be something like that. But many of those buckets, particularly the very large ones, are multi year programs. We don't flip a switch on on June 30th and say, oh, now we're going to do something different on July 1st, right?

Like audits and p and l statements don't always look the same.

Correct. I mean, those are point in time assessments of, of what is in reality and ongoing daily operation.

And that's very different than how we treat our operational general fund.

It's different in that sometimes those restrictions put firmer bright lines around those those example over over fiscal year transfers and carryovers, etc. Whereas general fund, by its very nature is more discretionary.

And also general fund, which is, I think of as operational. We want to expend those funds in real time in immediacy with more immediacy, because that because that's what we do with with general unrestricted funds. Correct?

Yeah. Councilor. I would agree with that. I mean, I think it's it's the caveat I would make is there are many funds, even restricted funds where we do want to deploy those dollars, you know, quickly, it's a balance, right? There are funds where there are very good reasons why we want to hold those and not spend them immediately. Right. And so that's true.

Dismissing it, I was just saying that in a pattern. It's when you're looking at financials, having that distinction between restricted designated and unrestricted is important. And I think sometimes we get documents. It's not always easy for us to just decipher that unless we dive deeper. Tell me about your process and plan to clean up the financial house at the housing bureau.

Councilor. Thank you for that. I mean, I think it's largely that effort is complete. This is identified as we talked earlier in this in this hearing. This 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 to be clear, consistent and transparent going forward. I 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. But I think largely that fundamental groundwork has already been laid.

And so this is, is this process and helpful to the bigger picture of establishing more consistent financial patterns throughout the city?

I think identification of the gap has been an opportunity to to rectify that.

And upsetting administratively. Would you like to add anything?

I believe cfo biery has already touched upon the main component of this, 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 it related to how do we handle some of our internal functions as a city. Some of the things that we'll be looking into as we continue to evolve as an organization that will help towards this, there's a lot of our strategy and planning work, and how do we build out of our organization really strategic direction that we're heading and the expectations of that. Our performance and data analytics and our investment in that as an organization is going to be critical to this as well, to ensuring that we're hearing that we're hitting the performance measures that we want to hit as an organization. These are all critical things that are working in conjunction with each other to produce a better way of doing government and governing a city, and I'm committed to it. I know our team is committed to it. I know the mayor, and this council is committed to better governance and operations and providing that to the city as a whole. I 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, and be intentional about how do we build this government back forward in an efficient, effective and economical manner that will prohibit situations like this from happening in the past and one that is more responsive to the needs of not only this council, but our community as a whole.

Thank.

Thank you. Sally. Chair, I want to say this as the vice to this committee of a whole with the financial lens, I 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. This is a continuous improvement work that portlanders are demanding from us, and I hope we use this as a case study, not a shame study to continue to learn from how we can improve and go forward. Thank you.

Thank you, councilor Ryan. So there's no one in the queue right now who hasn't already gone. I'm going to probably do a five minute increments going forward, and we'll just see how long we've we've got available for it. And I'll just noting, I am going to hop in the queue later on, but I see councilor Morillo in the queue. So we'll go to you and then councilor Green for a second round.

Mitch Green: Yeah, I know that councilor Avalos has to leave at 1130, so I would prefer if she could go first and then me and then order of the queue.

Is that okay with you, councilor Green as well? Councilor Avalos, you recognize. And then we'll go to aye, Morillo and then Green.

All right. Thank you all. So I have a follow up question for director levine. I 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. But 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. So I want to talk about kind of the reporting structure that you're working within in the city city budget office. So specifically, director levine, who are you accountable to in your role and within that structure? What is the expectation for how information is communicated to council?

Sure. I can give an answer and then I'll I'll look to the city administrator if he wants to weigh in as well. But. I'm I'm accountable to all of you and to the mayor. I, I guess as a bit of a history lesson, the city budget office for over ten years was an independent office, and the director reported to all five commissioners and the mayor. And with the change in the form of government, we are now rolled into the 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. So. Sort of administratively that is where we sit. But I very much see the city budget office as retaining a neutral and independent lens. And, 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.

So then given that, thank you for that history lesson. That is important to understand. 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 cfo, a d, c, a, a mayor. 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.

Councilor Avalos, I would like to step in and answer that question. And 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. The budget operations of our arm is under that administrative arm of our organization. And with that being said, my responsibility is to ensure that that communication is happening. If she's making, you know, if any 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 what we may feel as opportunities to change the information that we may have. And to just to clarify that, I just want to say that piece of it.

Thank you. 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. Is that correct?

That is correct.

Okay. Well, I think that is something we should look into as far as what it looks like to ensure that channel is not disrupted by other offices, including the mayor's office. I know I'm going to run out of time here. I have another kind of line of questioning on that, but for now, I'll I'll leave it there. Thank you.

Thank you, councilor Avalos. We'll go to councilor Morillo and then Green.

Angelita Morillo: Thank you chair. I was hoping we could have a dca oliveira come back up. I was wondering who was the party that overruled cbo's recommendation that the funds be included in the tor?

That was cfo biery call from my seat.

Thank you. And what was the basis for that overruling of the city's expert budget body? Perhaps it's a question for barry.

I would I would defer to him for that.

Please stay up here.

Yeah. Thank you councilor. So it was ultimately my call. I also want to acknowledge that I 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.

Thank you. I have a question for for donnie, following up on that, you previously indicated that you gave the mayor and city administrator a heads up on these funds in early September. You 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. If 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? Because you gave that heads up with a caveat that the information was not fully vetted. Correct?

Correct.

And 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? Correct. The charter requires that regular notification of the financial status of the city go to council, not a fully vetted proposal. So 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.

We were working through the information at that time, and that was part of the process. Correct.

And it was precise enough to negotiate the allocation for four months, precise enough to build a replacement proposal in 72 hours after the records were slated to be released.

The councilor the last the last iteration I wasn't privy to, it was shared with me, so I, I just want to be clear that the time frame I think you were talking about earlier was that September October window and that last iteration, I was not a part of that particular. The development of that particular one.

Okay. I 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, because aside from the fact that this wasn't a concern in sharing the 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, we were deliberating the tao on a false premise, and the existence of a 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. So generally, I think maybe this is a question moving forward for my councilors, for the city administrator and for our financial experts. Is this a precedent that we want to accept that every bureau, for every future unbudgeted balance has 4 to 6 months disclosure, grace period, that 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. And city administrator, I guess that's honestly a question for you. Is that a precedent that we should expect moving forward?

That's not what you've received from me to this date.

Thank you, sir, and 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 are they are deliberating and making budget and policy decisions without the representation of each district? That's what's happening. So I want to be very clear about that. I don't have. Let me check to see if I have any further questions at this time. I think that ends my questioning. Thank you.

Thank you, councilor Morillo. We'll go to counselor Green then. Councilor. Pirtle-guiney.

Thank you. I just have a few more follow up questions. Thanks for both being up there. I have questions for each of you to 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. That's what you said earlier, right?

I was referring to the the September 5th deadline. That was the first deadline because I believe she was on vacation.

Okay. Thank you. That'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, hey, I'm on vacation in my absence. You're acting. Isn't it true you could have conferred with the deputy bureau director about that spending plan and move that work forward.

That was an option, yes.

Thank you for cfo biery. I've got a couple questions. I want to go back to the tao, because we've talked a lot about uncertainty and confidence in numbers during the work session. I think it was October 22nd. We really dug in to the assumptions in that and a number of us, I think my 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? So isn't it true that confidence was low in the tao due to the efficiency savings? Because 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. It's just something that we hope to materialize. Wouldn't you characterize that as a low confidence resource?

That's fair. Counselor, I would I would consider that effort as a low confidence.

Thank you.

And just stepping back more generally, isn't it also true that confidence is always low or medium low with when it comes to blt forecasting, because it is a volatile revenue stream?

Councilor I want to be really cautious because I think we're making some causal assumptions here that are not apples to apples. You are correct that that is an assumption and there are many, many assumptions. We make some with confidence, some with lower confidence.

I'm asking the questions because earlier it was suggested that we don't want to make assumptions in our budgeting using uncertain sources. And I'm trying to establish here that we we already do that practice.

Yeah. Councilor you're correct. And I will say it is very easy to look at a prepared document six months in hindsight and feel like there should have been confidence in a number at any given time. That was not the reality in the moment. In October and early November, when this information was becoming aware from the seed I set 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. That is different from a realignment conversation that you're that you're referencing, different from a blt assumption conversation where there is some level of confidence, even if it's not 100.

I understand that, but during that discussion, in that debate, one of the major points of contention was that we were paying for our policy encumbrance carryovers, that were driving a $16 million deficit with compensation set aside. And the the solution was, well, we're going to realize efficiency savings. And 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. And 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. And so that's and that general fund return was never brought into that discussion.

Councilor. I think, again, I've heard. Dca oliveira I think, accurately say that there was confidence maybe in the housing bureau and from his seat, from the seat that I sat in at that moment, my confidence level was zero in the accuracy of that number and existence of that.

Okay. And my last question here is, you know, at that time, after the tao was presented, several counselors were working with the cbo to get amendments scored for the tao. I was one of them. Councilor Morillo was one of them, and councilor Smith was one of them. Each of these amendments were seeking to provide things like rental assistance. And, you know, hif nexus funds. I'm curious why these offices were not informed that there may be resources available from these funds, however uncertain they are, maybe, perhaps we'll know more later in the year by spring. Would caution you to hold off on this amendment. Until then, I'm curious why they were not told of this. If the cbo understood that these funds could be.

I would just answer, councilor, as I just did, that my confidence level in the existence of those dollars at that moment were zero.

Okay.

Thank you. I have no further questions.

Thank you, councilor Green. 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.

Okay. Thank you chair, to understand the timeline and flow of information a little bit more, I have a question for mr. Bonocore, our current interim director of Portland housing bureau. I 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. That you were not advised of, which you were not advised to. You didn't know about it. When did you first become aware of the reserve fund? And then also, what prompted you to bring it to the dca's attention at that time?

Thank you.

Councilor councilors michael buonocore, interim director for the Portland housing bureau, as 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, $11.7 million. And 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. So as I was having that conversation, the number 21 million came up for the first time that I had heard it. And that was really surprising to me because I had, you know, in no conversations with anyone had I heard the number $21 million. So I clarified with the team that number. I then called dca oliveira, disclosed it to him. He asked me to send the email that I had sent with that you're referencing with the the recommendations that we had been working on for the $11.75 million and to name that, I had learned about an additional $9 million.

And those recommendations. You were working on them? Yes. And were there also recommendations that you know about that former director hissrich had given also for these funds? Yes. Okay. And were those are separate suggestions or those were.

Yes, they were a director. Historiques recommendations largely informed mine. Everything that we were considering in the bureau at that time was really very much in the Lane of what of the kinds of spending that so would do. We were not thinking really more expansively than than that.

Do you know, when director historic gave those recommendations? And she.

I know the memo is dated. Yeah. I don't remember the date off the top of my head.

And what when you shared this email with mr. Oliveira, what led you to think that he had not already been made aware of these funds?

We had had a number of conversations in which, you know, as I said, I was working on a a set of recommendations based on the approximately $12 million number that that that number is the only number I had ever heard him say. And so it was alarming to me that there was a different number that I hadn't heard him say.

Okay, thank you. And for mr. Berry and mr. Oliveira. I'm. My questions for you too, 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?

I thank you for the question, councilor. From my part, certainly being a little bit more intentional with questions for my teams in the service area about budgets. I think I shared this in an executive session at the time. During the budget process of last year, I was working with two interim directors at p and d and prosper, so my priority largely focused on them. I was relying on my more senior directors at the time, at bts in housing to, to, you know, take care of their business. They, you know, they had the experience. There's also more challenges at prosper and peabody in the budget process, as you're all aware. So I think from my part, it's one is just being a little bit more intentional. They're asking questions more thoroughly and not making assumptions about oversight. And then as we've talked about already, I've shared, definitely appreciate your seat and the expectation for getting, getting communications about budget related issues, even if it's not exact or finite. I'll defer to cfo biery about the appropriate level of accuracy, but at least acknowledging that there's some discrepancy in a bureau's, you know, finding, you know, finding funding or finances and working with the cfo and cbo on that. And of course, really is a key takeaway for me. And I think that's just from my seat. I over. Let's see, I, I overemphasized ensuring that you were getting accurate information versus urgent information. And 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. Again, mine was a little higher than cfo beers was, but for my part, I can at least communicate that out. And then and then lastly, and this goes just to general work I think the city is doing, led by cully and cfo biery and the cbo office director. Levine's leadership is how we're telling the how we're communicating about our budget. Our city is very complex with various funds. Not all of them are the same. And I think internally, as a subject matter experts or if you will, we, we we speak in 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. Those things are meaningful and matter in terms. So we're not conflating issues. And that's just something that we can work on and get better at. So those would be the three big takeaways that I've certainly experienced through this process. Appreciate this bodies, you know, attention on oversight and trying to get to the get the answers for the public. Because I think there's a lot of lessons that we learned along the way.

Yeah. Thank you, councilor, for the question. I agree with everything dca oliveira said would would add. You know, sometimes I like to be right. Sometimes I don't like to be right. And I flagged long ago that we were going to experience deficiencies that would lead to these gaps. We've seen that in the material findings we've found in the aquifer. We'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 that clear, transparent communication to council in the public. So just one takeaway is that we do need to get serious about solving that. And it's not something I can do from as one human being who sits in the seat. It's a systematic improvement that frankly, has to start in this room. And so that's a takeaway that's I appreciate the sort of shared accountability and shared knowledge around this exercise. I 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 through policy, through practice, through communication, and continuing to grind every day to to get that transparent information to you and to the public.

Thank you. City administrator lee, do you have any specific concrete changes that you're implementing or you plan to implement, plan to implement to make sure that issues like this aren't repeated?

Some of it is some of the things they've already mentioned, some of 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 and 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, because we did it on paper. But the actions of the work that has to be done is still a work in progress. And one of the things that I've seen is coming into this role as it relates to this kind of change of government. Now, we have struggled from a change management standpoint. Change management has been critical in this change of form of government that we've had, that we have struggled through as an organization, and 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. We can't lose track of the people in our organization that this is impacting as well. There are going through the 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. So 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? I think that has to be at the forefront of the conversation that we're having as we move forward, and 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. Because 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 and appropriately and looking at how we do budget moving forward as an organization. It's also going to be as critical. So 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. And I want to be transparent with council where we are in that process. So 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 and as we move forward, it's really going to be looking at how do we improve our operations overall and do we have the right pieces to improve our operation overall as an organization? And I want to 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 time frame of those type of changes and what those expectations should be for this organization.

Thank you for that. And it's helpful to hear kind of high level your vision there. Are you able to give a in the weeds? I know we're not going to go into it, but in the weeds example of a change that you have made, for 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.

I think you're seeing 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, as it relates to the information that you're getting through this budgeting process, the uniformity of those information that you're seeing. I think that's one of the key things. I think that we have seen some sort of breakdown between the council and administration. It's just those lines of communication and making sure that that communication is happening in a fashion and being received in a fashion, that you're getting the information you need to make decisions. And I could go into more details about it, and I know we'll have some more conversation about this as we move around. But the biggest thing that I've been trying to emphasize is just the communication piece of how we're communicating with council, me 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 in, 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.

Thank you, councilor Koyama Lane. We'll go to councilor Pirtle-guiney, then, councilor Smith.

Loretta Smith: Thank you, chair, and thank you, councilor Koyama Lane, because that was one of the two questions I had written down to ask right now. And I think it's a really critical question for us to be asking today. Oversight 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. And that question around the very specific. Hey, what's going to change is, I hope, the core of what we're getting at. 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. I will ask, since that question has been asked cfo biery, there have been some questions about if we had had this money for the tor, what would have been different? And ultimately in the spring tor, we were able to return some money to the general fund to fill what had become an even greater hole sitting 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? We have had more. Would we have plugged holes in different ways, or would we be pretty much in the same place here in mid-april today? If we had had this information, let's say two months earlier, right, if that information had been shared with dc dca oliveira in may or June of last year, and we had gone through all of this two months earlier and had it for the tor.

Thank you, councilor, that's a good question. I think from a purely budget and financial perspective, we would be essentially exactly where we are today.

Okay. Thank you. That's helpful in my thinking about this. You 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, because we've asked a lot of questions that lead to information that I think we already have the answers to. And 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. And I'm a firm believer that oversight should be a part of what our committees do regularly. This program isn't working. We're hearing about that from our constituents. Let's have a conversation about why it's not working. It should be a part of the conversations we have. Cully with your administrative team on a regular basis. And 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. Because cfo biery to your point earlier, we will find more money. This will happen again because we are working on cleaning up our accounting practices. And in fact, this is a testament to the fact that this form of government is working, that we are going to find those things. And 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. So thank you. I appreciate that answer. And again, thank you to councilor Koyama Lane for the question about lessons learned and taking that one off my plate.

Thank you. Councilor pirtle-guiney councilor Smith.

Elana Pirtle-Guiney: Thank you, mr. Chairman. I would like michael bone a card. Jonah's cfo biery dca oliveira and cbo director levine. And I just have one question. I agree with what councilor Pirtle-guiney just said. This is a big task and we're all learning at the same time. And I think we're trying to learn and, and walk and chew gum at the same time. And as councilor Morillo said, we should be able to do that. But there's so many moving balls and communication, getting communication to, to all 12 of us that that is a big task. And I do recognize that. But before I ask you all this, one last question each, I want to say this to ca lee. Do you think it is unreasonable and we're in a oversight hearing? Do you think it is unreasonable for council to ask where every penny is in this in this city? Is that an unreasonable ask?

No, it's not unreasonable. Ask.

Thank you. I have one question, michael. On February 4th in a city council meeting, because most of my questions were answered, I really didn't necessarily need. Today I asked you the question, did you know that you did not report the monies from the housing bureau? The 20.7 you said yes. I said, did your people know under Oregon budget law, we have to budget every dime, even if it's in reserve? You said yes. And I said that's a large amount. Now that we know that it's increased, was this over multiple years? And you said yes. So I was good. So 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. Did michael jordan or mayor wilson direct you to not tell us about unbudgeted funds? Michael.

No.

Dca oliveira did michael jordan or mayor wilson direct you to not tell us about any unbudgeted funds?

No.

Cfo biery did former city administrator michael jordan or mayor wilson direct you to not tell us about unbudgeted funds?

No.

You'll need to unlock your iphone first.

And 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? No thank you. I think that was the only question that I had from that day. I 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. That is my only goal. And to make sure that we that we as policy makers, that even if money goes into reserves, that we can put it in reserves, just let us know. Thank you so much for preparing us for today.

Thank you, councilor Smith. Go to councilor Novick and then I'll put myself in the queue.

I want to thank councilor Pirtle-guiney for two things. One, 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 that we would have if we'd known more sooner. That doesn't mean that no harm, no foul. That doesn't mean that maybe we shouldn't have known certain things sooner. But I think it's important for the public to know that there haven't been drastic consequences to the city as a result of of what some would characterize the delay in the council hearing stuff. On a lighter note, I want to thank councilor Pirtle-guiney for something else, which is that given my age and the watergate was a central thing in my childhood, when I think of anything relating to oversight hearings, that's what I think of. And so I've been thinking about that today. And 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. So thank you, councilor.

Thank you, councilor Novick. I thought I had a little more time there to get prepared, so I'll ask a few questions now as well. And I appreciate everybody being here. 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, and I imagine probably not the director, but maybe the other three folks up here. It's been said multiple times that the $11.75 million number was not certain from late August, I believe, until the disclosure in November, which itself was a day or two after the 9 million that made it 20.7 was was confirmed. So the disclosure actually occurred at a time of maybe maximal uncertainty because of that additional $9 million being added. I want to point out that while that number, the 11.75, which did not change, was being verified, several spending plans were being developed. 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?

I'll take that question, councilor. So there were a couple of things happening in parallel. Just there was the like the question of answering like what? Well, first, how did the money why was the money not budgeted? Like, what was the the dynamics that allowed this, this particular tranche of resources to be there? Unbudgeted. And then the question of what were allowable uses, what is the program typically doing? There was just like a one on one of like, what does this thing do? And essentially the bureau producing expenditure plans is what they would have done as a part of the budget process. I think that's something that has sort of been lost in translation. Picture a scenario where the 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 have been budgeted with a plan. So the question is essentially, how would you have if they had been budgeted appropriately, how would you have done that? Like what those dollars have gone towards? So there was sort of that machination that was the first iteration that the director historic, you know, contemplated in hers. And then after a conversation in September, had that second pass that that she shared in October that included that particular case, that there was a general fund allowance in those dollars. Right? So there's that's one path. And then there's that second element, which is the confidence in the numbers. So let's figure out what they're used for. How would you use them then also, hey, we got to do some due diligence. How do we miss these dollars in the first place? What's the real number? So that was that was happening in parallel. I also just want to reiterate and restate that October was a very difficult time for the, you know, the housing bureau for different reasons. Sure. And when we got to that point of confirming the 11.75, it was also at that same time as they were like lock stock in that number in. That's when the reserve concept with the additional 9 million came forward, which the bureau had apparently discussed prior in the summer. That wasn't made. I wasn't made aware of that until michael's email to me. So that 9 million just added. That was just an additional number that was validated as being. Yeah, that number is actually really there.

Okay.

So so that's, that's essentially the parallel that was happening. So that's how those two things can happen.

So 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.

It well.

Yeah councilor Thank that. So again, as we've talked about previously in time that I became aware and confident. And so we're talking about two different simultaneous tracks. Okay. I also will. So so if I had the ability to sit in every meeting and every bureau conversation, there would be like seven of me, probably 12 of me. That's not what exists. So that was not a possibility at that time. Also, just want to acknowledge that putting the two together itself happening exactly the same time, very heavy lift. City administrator jordan was out. I 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. So I just want to set the stage of the difficulty in having clarity about that information. I 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, I 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. And I've said that multiple times out loud and taken these public lashings many times. If there's something else you would like me to say to answer your question, I'm happy to speak that.

So I'm I just want to point out, I've asked one question so I understand that you may have a frustration with that, and I apologize for creating that, but I've asked one. 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 monolithic, monolithic organization, but is there a difference from just a follow up to that in notifying council and notifying the public.

I will answer that question. I think what I have seen through this council at times is notifying this council at time has been notifying the public as as information, as we have shared information with the council, that information has reached the public and in that fashion, typically in any government, we know it has that possibility to do it. We would hope, in those kind of conversations, as we're 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 communicate, 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? Because 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. And 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, and 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 is happening overall. And I think there's room for growth on both ends of it. There's room for growth from the administration in. And how do we communicate and ensure that council has that accurate information. There's room for growth from a council, from a grade 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.

Thank you. I might circle back to that, but I, I wanted to to come in on these, and I want to note the mayor's been here patiently and hasn't had been called on. And feel free to jump in, mr. Mayor, if this if this is something you'd like to. I want to understand the sequence, though, so just make sure I have this right. It looks like the city budget office recommended the inclusion in the fall. Tor housing bureau director also provided recommendations at the time, and then shifting a little further forward to, I believe it's the weekend of the 17th, 16th of of November. There's a time where responsibility for developing these recommendations shifted to Portland solutions. And that's. Is that an accurate description of what happened? I see there was an email from director brucker at that time with the in the records of what the recommendations.

The Portland housing bureau and Portland solutions were really teamed up together on the shelter to housing strike team. So they had a close relationship. We meet every single week. Different sort of discussions are at the table, but there's a relationship between the two to address the housing and homelessness emergency.

Thank you, mr. Mayor. So would I be correct in saying that that was the process working as it was intended to at that time?

The 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.

In terms of the content of the recommendations. Fair enough. Thanks. At what point, I guess we've asked, you know, where many other of the other folks at this table have been involved? I'm trying to understand at what point, and this is to circle back to to the question I asked to to city administrator lee, at what point the mayor your office became aware of the money? Because my understanding from the records is it's a significantly maybe a couple months gap from then to the council side. Is that accurate? And by the way, I think you should know as early as possible. I want to be very clear about that up front here. I think the mayor's office and you specifically should know as early as possible, but I just want to make sure I understand that there was a gap there. Is that accurate?

Sorry. Accurate gap. Sorry. Can you clarify the gap.

The gap between when the mayor's office was notified and when the council was notified on November 20th?

Early on in when the the numbers were first shared with me, I gave the administrator, jordan cfo biery, and the mayor like a heads up. But no, it was a a passive comment and a passing comment and a check in. There's something at the housing bureau. We're going to figure it out. Like 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. So I would say that was the first time. And then more specifics came later in October, at the end of October, early November, when we said, okay, this is this looks real.

So the gap was more like 2 or 3 weeks, maybe.

A month. Yeah, I would say okay.

And it so happens that these 2 or 3 weeks were pretty significant because of the tor and because of everything else going on, which cfo biery pointed out. But it's not a lengthy, you know, number of days, nominally speaking. But I appreciate that. I'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, does that distinction exist or does can is there a similar distinction in terms of notifying the mayor's office and notifying the public? See ali.

Typically in the form of government that we have, the mayor would have probably been the first person to know, as the executive arm of the organization. And then we would have probably notified council president and vice president and their then distribute out the information to the full council. That's typically how I would have worked a communication chain like that. Make sure the leadership of the organization is aware of the situation, then making sure that communication is hitting the full body. Okay.

I have a comment on that, but I did want to ask one other semi-related question to cfo biery. I appreciate your point about operating on a shoestring. I also know that that's true of the city budget office and many other parts of our administration right now. I've also heard you say, cfo biery, that you do not have the human capacity to meet council's expectations at the at the current time, I don't know that the council can give you everything that you need, but I don't 100% know what those what that would be. And I'd like to work to get you more of it. And that applies as well to city budget office. So 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?

Yeah. Councilor, thank you for the question. I don't I don't have a number to to provide you, you know, frankly, recognizing the constrained budget environment, that wasn't work that I prepared to to present an ad package. Certainly there are things in motion. Many of the things we've discussed today, organizational realignment and, and kind of corrective reporting expectations that will help mitigate that. There's two ends to this question, right? One is the number of humans to catch the work. The other end is kind of the volume and expectations about performance of that work. And so I can happy to work with you to come up with a more firm numerical representation of what that that expectation might be. But 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, and that would be an immediate action that we could take collectively to help produce a little bit of bandwidth.

Yeah, I appreciate that. And that leads me to the thought that there is a a structural gap in us not being able directly at the moment to ask for those aid packages some years when the overall constraint, because there's going to be times in a year where you still have to invest in some parts of the administration, and there's going to be times in an ad year where we still want to cut. But the the overall piece is, 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. The other point I want to make is, is something we've said several times from 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 time frame built in for 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. That's my opinion that I've expressed several times from this dais. I 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 on the record, so I just wanted to restate it for myself. 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. Thanks.

Thank you. I think I have some four minutes left. I just think it's clear to me today after, you know, this process as well as the report that kelly is 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. I think that jonah's deep dive with the employees to, frankly, unearth other areas of unbudgeted, we'll call them reserves is commendable. And I really appreciate you doing that deep dive. I think leaders go to the point of friction, and this was a point of friction. And you dove in to michael bonocore, our interim director. I just very much appreciate that. Within the first days of taking the helm, you began to kind of write the ship. You your instinct to notify the d, c, a and others was the right instinct. And 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. Directors have instinct that we. We ask you to to use and you did that. So thank you for staying with us. Thank you for for writing the ship a bit. And I understand that the former director was separated with a no cause provision, and that's the administration's purview. I won't question that. That's your prerogative. But mr. Bonocore is 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. And 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. So I appreciate everybody who has stepped in to right a ship that, frankly, was not being transparent last year. It was a different bureau. This year it's this bureau. I wonder how far it goes. And 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. There is no not reporting of money, all funds to councilor Smith's point, all pennies in this account shall be determined, clear and transparently. So thank you for those who stepped in. This has been an odd several months. I never thought, when I asked a simple question in July about where does the fund go and what has it achieved that this would turn into such a cascade? But it certainly has, and there are a lot of reasons for that. But for those of you who had the professional instinct to do the right thing, thank you for taking the time to make that clear. Thank you for unearthing additional funds and my appreciation to you exists. Thank you.

Thank you, councilor Zimmerman, councilor Green. And then we'll start the process of closing it out.

Yeah. So I don't actually have any further questions. I'm in the queue. If there's a part of your hearing that has a general discussion piece among council, that's that's what this is for. Just go right into it. Okay, great. Thanks for everyone for taking the time to answer my questions today. I know this has been a difficult several hours, and I appreciate your partnership in helping us grow as a city. I 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 town, but that information was not shared with council. Specific recommendations were made by the cpo and by the head of the housing bureau that these funds could be used in the towel, but those recommendations recommendations never made it to us, and as a result, we made critical budget decisions that might have been very different had we been given the full picture. And that is a real problem. And we've all talked about and acknowledged that we've got to fix that. So I think to the extent that there is any kind of closure on this oversight hearing, it's the acknowledgment that that that there is work to do. So I think that's a win. But I do want to push back on one thing that I've heard today up at the dais, not not from anyone out there, is this idea that there were no practical consequences to delaying disclosure until after the towel. Colleagues, we learned about the presence of this money, and the city learned about the president's money through reporting that presented it as a scandal. It said, whoops, we found $21 million. That's just hidden. And and 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 to address on a programmatic level. And we had the loss of public trust because of it. So there was consequence. I think there was significant consequence of that. And 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. Now that ship has sailed, we're going to do a better next time. I'm pretty confident in that. One of the things that I've heard through this discussion is, is that actually, there is a line of reporting from the cbo up through the city administrator, and that's. So I actually have a question for the city attorney in the charter. I understand that it grants the mayor the duty and the right to propose the budget. It's the mayor's obligation to propose the budget. I 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 cbo at any time. Could you could you give me a little bit of understanding on that?

Yeah. Great question. Thank you. Robert taylor, city attorney, the budget director is a position that is expressly called out in the charter. It is under section 2-406. H, and that's the portion of the charter that outlines the duties of the city administrator says the city administrator shall control and administer the financial affairs of the city. The administrator may appoint a budget director to act under the administrator's direction. So that's the portion of the charter that assigns the budget director under the administrator. The administrator is under the mayor. Okay. And there is also a city code provision around the budget office, what their duties are and how they're supposed to provide information. And in there, it talks about the budget office having responsibility to give information to the mayor and the administrator and to counsel. And I think that is what budget director levine was trying to express that structurally. She reports up to the administrator and the mayor, and there's this code provision and, you know, this understanding that she needs to work with you as the as the the body. And an administrator. Lee was explaining his expectation for how all of that should work in terms of communications with you and sharing information.

That's very helpful. I appreciate that answer. So my understanding is that what's not expressly spelled out in the charter is clarified in code as to then how the cbo performs the function envisioned in the charter. And then so then if there's opportunities to change this and clarify the connection between the cbo and council, we would do that through code.

I think this council would have an opportunity in the code to adjust the responsibilities of the budget office. That needs to be consistent with the charter, but I. But I do think the charter is clear on the reporting structure, but in terms of the duties, I think there is some ability for the council to legislate in that area.

Okay. Thank you. I appreciate that, and colleagues, thanks for your participation in this today. I, I think I'm I think I'm done. So thanks so much, mr. Mayor. Thanks so much, mr. City administrator.

Thank you. I see, as you've been speaking, councilor Greene, that councilor Smith and Novick have gotten in the queue. We've got enough time for each to have a couple minutes, so I'll do that. If anyone else wants to get in the queue, now is your last chance. So councilor Smith and then Novick.

Steve Novick: Thank you, mr. Chairman. City attorney taylor, you talked about what was in code, in the direction that it gives for the budget director. Now, when was that code? Doesn't the charter supersede the the code? When was that code written?

It is correct that the charter supersedes the code. And that code that codes been around for a while. It existed in the previous form.

Of 2030 years.

I don't know if it is quite that long. I think I I'll try to do the history lesson.

Where I'm trying to go is that that code is what it is. It is a code. And it and as many have said here about this, today's hearing, it is a relic of the past that got us to today. So 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. And so unless you change the charter, you cannot change what the city budget director does in code.

You cannot do in code something that is inconsistent with the charter. The the 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. In terms of the budget office, I think it's an interesting conversation. I think historically it reported to the mayor and 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. And then I believe this code was adopted many, many years ago by the prior form of government.

Right.

And the intent of that was to try to give other councilors more access to the budget office. And 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. And 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.

Right in the charter says that the budget director reports up to the administrator and the mayor. And I'm good with that, and I'm good with the direction that that our budget office gave us, that they also want to give us information as well. And I think this comes down to an information gap. What I found here was an information gap. And if we if we find out months later about monies that were known about and they were not reported in our previous fiscal year, and now we're, you know, we're going on to another fiscal year, it it gets dicey for us because we are the policy makers. And then when a towel comes out that has policy decisions in the towel that have been created by the budget office, they don't create policy. They should let us know, let us write the policy and say, this is where we want to go. So but we're getting policy direction from the budget office. And that's not what they said. And so that direction either has to come because in the charter, the mayor can drop policy. So I think where we're experiencing some difficulties up here is just about where we get the information and legally how we get the information. I don't know how you legislate that, but that's a that seems to be a common theme.

Yeah. Thank you. I would I would agree with that. And there was reference among council today about the other provision of the charter that the administrator is has the responsibility to keep the council fully informed of the financial affairs of the city. And and and that is in the charter. And I think that is a lot of what this conversation has been about from from council and from the administration in terms of when do we expect to get the information, how fully baked do we expect the information to be before we get it? We what when is our level of confidence in the information that we feel like we. We can even share it that it's reliable or semi-reliable. And I think that is the conversation that has been very helpful today to have. And 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.

Thank you, attorney taylor. Thank you, councilor Smith. Councilor Novick about three minutes.

Steve Novick: Sorry.

In response to councilor Green's comment, I just want to say that I don't think that either councilor Pirtle-guiney or I said that there were no consequences from this information not being known earlier. I think that we said that we don't think that there were policy or financial consequences. Obviously, it was not a good thing for the 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. Those were not good stories. I did also want to say that after we knew about the money, it took this council nearly four months to decide how to spend it. I'm not saying that that's bad. I think that it's better to spend money thoughtfully than spend it quickly. But 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 town.

Thank you, councilor Novick. So I'm going to start the process of closing out. But first, I want to take the opportunity to thank everyone who was here for the administration. Deputy director gonzalez, I don't think we ever even called you up, but thank you for being here. I appreciate it, city administrator lee, and I think it's worth pointing out for those who weren't tracking that, that all this happened before city administrator lee started. So if you didn't know, now you know, cfo biery, thank you for being here and answering questions. City deputy city administrator oliveira, thank you for being here as well as housing director. I specifically want to thank the mayor for coming and and taking time out of his day for me, for being here. And just on a personal note, every time we see ruth levine, the director of the city budget office, I am really impressed over and over again, doing the right thing and having the initiative to do so. So I want to just add that as well. We kind of set aside a couple minutes here to talk about what did we learn. I don't know that that's really something that needs a separate conversation. I think that's for all of us to consider as we move into the next step. But just a question to pose to all of us as we think about the next hearing, because I do want to thank everyone for approaching today with seriousness and with decorum. I do agree with councilor Greene's comment earlier that ideally, oversight is routine and boring, and I intend that this won't be the last oversight hearing we ever have. The next step for this particular process is up to the council president. Under 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. So and I think ideally, these hearings are not in reaction to any particular incident or revelation, but part of our regular book of business. So with that, I will adjourn the meeting of the committee of the whole and this oversight hearing at 12:26 p.m. Thank you, everybody.