Audit: Portland isn't focusing enough on maintaining streets

By Shannon L. Cheesman, KATU.com Producer/Reporter Published: Jan 30, 2013 at 6:00 AM PDT Last Updated: Apr 26, 2013 at 1:54 PM PDT
Audit: Portland isn't focusing enough on maintaining streets »Play Video
The City Auditor's Office has released its findings after taking a closer look at the Portland Bureau of Transportation's finances. Photo courtesy andyprice on Flickr (Creative Commons).

PORTLAND, Ore. - The city has been putting too much focus on new transportation programs/projects and not enough on maintaining the streets, sidewalks and bike lanes that we already have, according to an audit released this week.

The City Auditor's Office is raising a red flag after taking a closer look at the way the Portland Bureau of Transportation (PBOT) has been spending its money.

The one thing that stood out, they said, is that while PBOT has had a marked increase in revenue (mostly due to parking fees and a state gas tax), our transportation officials have been spending less and less money on maintaining the city's streets.

So what gives?

Auditors discovered that the city's newer programs (like streetcar operations, downtown marketing and transit mall upkeep) and throwing in big dollars for capital projects (like Portland-Milwaukie Light Rail and the replacement of the Sellwood Bridge) have been taking precedence.

The graph below, provided in the audit report, illustrates the difference in budgeted spending between fiscal year 2008-09 and the current fiscal year. Of note is that the maintenance/operations budget went from $68 million to $59 million, while other budgets increased.

It's that change in priorities that caught the attention of auditors.

Another issue highlighted in the audit is that the city council hasn't always had a completely reliable source of funds for some of the programs/projects they implement. When funding falls through, the money has to come from somewhere and it looks like maintaining our streets has been taking the hit.

"When these new projects were approved, the potential impact of the new projects on existing programs was not quantified," the report stated. "Instead, Council often relied on uncertain future revenues to fund the projects, such as new parking revenues from parking districts that had not been created, and development charges that were known to be volatile. While the City Council may not have intended for new projects to displace other transportation services, this has nonetheless been the result of these spending decisions. Over reliance on certain new revenues that did not then materialize decreased the funds available to maintain existing transportation assets."

Portland Mayor Charlie Hales, who made the condition of Portland's streets one of his campaign platforms, believes the report puts into writing a point he has been trying to make for a while now - that our existing roads are not getting the attention they should be getting and a change is in order.

"Useful, useful, useful - that's how he described (the report) when I talked to him about it," Dana Haynes, the mayor's spokesman, said.

To give you a little background, Hales took a big step with PBOT when he first got into office by asking the director at the time, Tom Miller, to resign. He then appointed a new interim director, Toby Widmer, to oversee PBOT while a permanent replacement is sought.

Haynes said the mayor is confident that Widmer, who retired as director in 2002 and has extensive experience in road maintenance, will be able to get the ball rolling in the right direction before passing the baton to a new leader. Hales hopes to find a permanent PBOT director within six months.

In the meantime, PBOT (which did not dispute the findings in the audit) will move forward in a different direction.

The City Auditor's Office is recommending that PBOT adopt a strategy outlining its goals and objectives and then report the measures they are taking to reach them. Also, any new projects would be required to have a detailed analysis of how they will be funded, along with a backup revenue stream should the initial plan not pan out.

"Our concern is that without a plan, the city could go in any number of directions without having a sense of where to put new money coming in, or in the future if there is a reduction in transportation spending," said Drummond Kahn, Director of Audit Services for the City Auditor's Office (pictured at right).

"If your family came in to some additional money - you win the lottery or get an inheritance - a good plan would help you allocate that," Kahn added. "In the same way, a good plan will help the city say 'gosh, we're getting more money from parking revenue and from the gas tax - let's put it toward parking or the streetcar or maintaining the streets.' And that's the policy choice that council now has."

Kahn did say that the audit wasn't all negative.

"We found some good news in the audit - that all the way until 2016 and 2017, the city is expecting to have even more transportation revenue from the gas tax and from parking fees," Kahn said.

Kahn said at this point, it's a matter of deciding on priorities and managing where all that money goes.

"Our recommendation to the mayor and City Council is to develop a plan for what to do with that resource to best maintain the city streets," Kahn said.