Authorize a temporary interfund loan not to exceed $50 million from the Portland Parks & Recreation System Development Charge Fund to the Fire and Police Disability and Retirement Fund to provide interim financing for fiscal year 2025-26 cash flow deficit due to the timing of property tax collections

The City of Portland ordains.Section 1. The Council finds:The Fire and Police Disability and Retirement (“FPDR”) Fund of the City of Portland (the “City”) will experience a cumulative cash flow deficit during fiscal year 2025-26 due to the timing of current year property tax collections.The FPDR Fund expects monthly deficits to occur prior to receipt of the majority of property taxes in November and December 2025, and resources are needed to pay for planned expenditures until that time.The FPDR Fund cash flow deficit has historically been addressed by issuing short-term tax anticipation notes through the public municipal bond market, borrowing directly from a bank, or borrowing from another City fund.The City Debt Management office estimates that an interfund loan will present the least risk and provide the lowest cost financing for FPDR for fiscal year 2025-26.Per local budget law (ORS 294.468), the City may loan money from one fund to another for operating purposes for up to one fiscal year.The City’s Comprehensive Financial Management Policies, specifically FIN 2.18, allow for interfund lending as an alternative to bank loans or public debt issuance when bureaus require funding, and when sufficient legally available balances exist in other funds which can be loaned without impacting the lending bureau’s operations.The FPDR Board of Trustees approved Resolution No. 559 on May 27, 2025, authorizing the FPDR Fund to borrow up to $50,000,000 from another City fund available by law in fiscal year 2025-26.Portland Parks and Recreation (“Parks”) has sufficient revenue in its System Development Charge (“SDC”) Fund to lend monies to the FPDR Fund temporarily until sufficient property taxes are received. Loaned SDC funds will be repaid in full with interest no later than January 31, 2026, the maturity date of the loan.The City’s fiscal year 2025-26 budget includes approximately $229.9 million of ad valorem taxes to be received by the FPDR Fund in fiscal year 2025-26, which will cover all planned fund expenditures as well as the costs of a cash flow borrowing.NOW, THEREFORE, the Council directs:The City hereby authorizes a temporary interfund loan in an aggregate principal amount of no more than $50,000,000 from the Parks SDC Fund to the FPDR Fund to finance the deficit in the FPDR Fund, in anticipation of the receipt of revenues from the FPDR property tax levy for fiscal year 2025-26, and in accordance with City financial policy FIN 2.18 and the terms shown in Exhibit A.