The Portland City Council is looking for ways to address a massive budget shortfall, but one of the drivers of the deficit — declining property taxes — is an ongoing issue with no easy fix, some experts say.

Why it matters: In a memo to city leaders last week, city administrator Michael Jordan outlined areas that could see potential cuts, including cuts to summer programs at parks, reductions in street paving projects, and layoffs of at least 120 city employees.

The latest: In a joint statement, Mayor Keith Wilson and Council President Elana Pirtle-Guiney said the city was committed to "exploring every option, thinking creatively, and working together as a team to make sure we keep city services moving."

Context: In recent years, Portland has faced declining property tax revenues due to two state tax measures passed in the 1990s.

• One capped property taxes at 1% of a property's assessed value and another capped assessed value growth at 3% a year.
• Together, the measures have provided predictability to property owners, but they've also cut deeply into tax revenues, according to the League of Oregon Cities.

What they're saying: Paul Manson, a political science professor at Portland State University, said with taxes constitutionally limited, rising costs of labor, inflation and increasing need for public services will continue to strain city budgets.

• "There's a disconnect, and it gets harder every year," Manson told Axios.

Yes, but: This problem is not unique to cities like Portland, which is also facing rising labor and healthcare costs as well as expiring one-time federal funds.

• Mary King, an emerita professor of economics at Portland State, said the tax measures have had a devastating effect on municipal budgets.
• "Year after year, we have a structural deficit because property taxes are not keeping up with population and needs," she told Axios.
• King noted that, because of the cap on real estate assessment growth, Oregon taxpayers were only paying taxes on 50% of their properties' actual value, per state statistics.

What we're watching

The James Beard Awards announced their 2025 semifinalists yesterday, with a dozen Oregon chefs, bars and restaurants in the running for the industry's premier recognition for tastemakers and trendsetters.

The latest: Oregon nabbed 12 spots on the semifinalists list — more than last year — with some surprises and repeats.

• The 35th anniversary of the Chef and Restaurant Awards marks an expansion into three new categories focused on beverages: best new bar, outstanding professional in beverage service, and outstanding professional in cocktail service.

Zoom in: Here are the categories where Oregon secured semifinalist spots:

Outstanding restaurant: Coquine (Portland)

Outstanding chef: Sarah Minnick of Lovely's Fifty Fifty (who's been a semifinalists thrice) and Gabriel Rucker of Le Pigeon (who won the same award in 2013)

Outstanding bakery: Jinju Patisserie (Portland)

Best chef — Northwest and Pacific:

• Joshua Dorcak of MÄS (Ashland)
• Isaiah Martinez of Yardy Rum Bar (Eugene)
• Thomas Pisha-Duffly of Gado Gado (Portland)
• Ryan Roadhouse of Nodoguro (Portland)
• Sarah Schafer of Humble Spirit (McMinnville)
• Kari Shaughnessy of Hayward (McMinnville)
• Timothy Wastell of Antica Terra (Amity)

Outstanding professional in beverage service:

• Joel Gunderson of Heavenly Creatures

Outstanding bar:

• Scotch Lodge (Portland)

What we're watching: If the last two years are any indication, we're more than well-equipped to sweep the whole thing yet again.

What's next: Finalists will be announced April 2, and winners will be celebrated at a Chicago ceremony June 16.

Tell a foodie

🏫 Portland Public Schools may need to cut up to 228 positions as it reckons with a $41 million budget gap. (The Oregonian)

In an open letter, Mayor Keith Wilson pledged to stand in solidarity with the city's undocumented residents in response to President Trump's plans for mass deportations. (KGW)

🧑‍🔧 SVI Electronics, a Thailand-based electronics manufacturing company, opened its first U.S.-based facility this month at the Vancouver Innovation Center and plans to hire 100 workers. (Portland Business Journal)

Two unions representing City of Portland employees are preparing to strike as the "biggest obstacle" in its contract negotiations is the looming budget crisis and how it could impact future wage growth for workers. (OPB)

Portland's ranking in an annual list of the country's best cities fell more than 60 spots due to a significant loss in short-term job growth and available affordable housing.

State of play: The Milken Institute's yearly report measures U.S. cities' economic performance based on job and wage growth, housing costs, economic equality and other factors.

• 200 metro areas and 203 small cities are assessed in the annual report.

The big picture: While many cities have largely emerged from the COVID-19 pandemic, cities like Portland are making a sluggish recovery.

• Portland dropped from 40th place last year to 105th this year.

How it works: The annual rankings from Milken — a nonpartisan, nonprofit think tank — are based on its Best Performing Cities index, which takes into account cities' labor markets, tech industry growth and economic access.

• Yes, but: The report doesn't explicitly look at other quality-of-life factors people may consider when picking a place to live, including traffic congestion, public transit access or park space (where we rank high!).

Full rankings