Portland Faces $4.5 Billion Shortfall, Earning a “D” Grade

Portland’s financial condition worsened in fiscal year 2023, with the city facing a $4.5 billion shortfall. This equates to a Taxpayer Burden™ of $18,600, earning Portland a “D” grade and classifying it as a “Sinkhole City” in Truth in Accounting’s latest report.

The city's financial position declined by $95.5 million, primarily due to pension liabilities outpacing investment income and contributions to the fire and police pension plan. As a result, unfunded pension obligations continue to strain the city’s fiscal health.
Governmental expenses rose by $186.95 million, with public safety expenses alone increasing by $97.99 million. Of that increase, $88 million was attributed to higher pension-related costs. As pension obligations grow, Portland will need to find sustainable revenue solutions and better manage increasing expenditures to stabilize its financial future.
Key findings from the report include:

• Portland had $2.1 billion available to pay $6.6 billion in bills.
• The city’s financial shortfall amounted to $4.5 billion, leaving each taxpayer with an $18,600 burden.
• Rising pension liabilities and increasing expenses continue to challenge Portland’s financial stability.

With growing financial pressures, Portland must take proactive steps to manage its rising obligations while securing stable revenue sources to maintain long-term fiscal health.

For those interested in a deeper dive into Portland’s finances—and how it compares to other major U.S. cities—you can read the full Financial State of the Cities 2025 report here.