Keep paying older pensions from annual taxes, build a partial reserve, or move toward full prefunding? Each approach shifts costs and risks between today’s and tomorrow’s residents.
The evidence here explains the choices. It does not establish which funding approach offers Portland the best value.
Compare all three paths on equal terms. Keep annual funding, build partial reserves, or fully prefund. Change course only where benefits justify costs and risks.
When to act—and what to askSeptember 16, 2026 · Council briefingFinancing is the focus; benefit changes are outside the scope. Agenda & presentations
FPDR means Fire & Police Disability & Retirement. The old pension is pay-as-you-go; the levy also helps fund PERS pensions for newer employees.
FPDR One and Two are closed to new hires. Their remaining obligations continue as members retire and survivors receive benefits.
Portland already changed course for new hires. The transition means paying old-plan benefits and prefunding newer workers' pensions together.
City five-year plan, pp. 1–2. FPDR also provides disability coverage for sworn employees.
Shares of $258.7M in program operating expenses—not shares of the $279.2M gross levy. Excludes fund-level items such as borrowing repayment and contingency. Adopted budget.
Present value of earned benefits
$27.7M in plan net assets
Includes more than the old pension
The liability is an accounting estimate, not a bill due today. Future tax revenues are not counted as pension assets. 2025 audit · 2026–27 levy ordinance
Former public-safety employees and surviving family members. These financing options leave their promised benefits unchanged.
A dated snapshot · June 30, 2024
Receiving old-plan pensions
Annualized from monthly benefits
Still earning FPDR Two benefits
Newer hires have a different pension system. Their PERS contributions continue even after the old plan winds down. An old-plan funding reform cannot make the whole FPDR tax line disappear.
2024 actuarial valuation, Appendix A. Counts are not a current roster; disability recipients and alternate payees are separate categories. Pension averages are not total compensation.
Start with the assessed value on your FY2025–26 statement, not your home's sale price. Reconstruct that year's charge, then explore the City's forecast rates.
Your assessed value · FY2025–26
Use the assessed value on your county statement. It can differ substantially from market value—even for similar homes.
Enter an exact amount, or use the slider.
A household scenario, separate from citywide tax-base growth. Property changes and the relationship between market and assessed value can produce different outcomes.
Estimated FY2025–26 charge
$1,046
per year · $87 monthly equivalent
One year of 3% growth, then the City's forecast rate.
FY2025–26 through FY2030–31, including the base year.
Fiscal year ending · dark = base year; light = forecast
Estimate before tax compression, exemptions and payment discounts. Check the FPDR line on your county statement for the actual charge. Future amounts are scenarios, not a tax quote.
Assessed value ÷ 1,000 × the FPDR rate. The FY2025–26 rate is $2.9874 per $1,000; subsequent rates come from the City's five-year plan. Only future years apply your selected growth assumption.
| Fiscal year | Assessed value | Rate / $1,000 | Estimated charge |
|---|---|---|---|
| 2025–26Certified rate | $350,000 | $2.9874 | $1,046 |
| 2026–27Forecast | $360,500 | $3.1906 | $1,150 |
| 2027–28Forecast | $371,315 | $3.2800 | $1,218 |
| 2028–29Forecast | $382,454 | $3.3897 | $1,296 |
| 2029–30Forecast | $393,928 | $3.5030 | $1,380 |
| 2030–31Forecast | $405,746 | $3.6082 | $1,464 |
County rates · City forecast, p. 6 · Oregon assessment rules. The 3% scenario approximates a common unchanged-property case. It is not a universal cap on assessed-value changes or tax bills.
About 32% of the City's gross levy goes to FPDR in FY2026–27. That is $279.2M of $868.5M across City levies. It is not 32% of your whole tax bill, which includes other governments. Levy ordinance.
Oregon limits certain property taxes on each property. Where that limit binds, a higher FPDR levy can crowd out other collections.
Additional tax can be collected.
Residents can feel the cost through services.
The tax-limit rules are documented. How much a specific proposal would raise bills or reduce other revenue still needs property-level analysis.
“Compression” is the reduction in taxes needed to fit within a property’s legal limit. Local-option taxes are reduced first. If those reach zero and the limit is still exceeded, other taxes in the category are reduced proportionally. FPDR can also lose collections.
This is not a fixed dollar-for-dollar transfer from another service. Renters may be affected through services and possible rent changes; tax increases do not pass through to rent one-for-one.
Oregon’s compression rules · City presentation, slides 11 and 16
Old-pension costs eventually decline. Contributions for newer workers continue. A falling tax rate does not necessarily mean a smaller bill.
FY27 is authorized, not collected revenue. Earlier years are reported levy amounts. County tax records · FY27 ordinance.
Two years from the same Milliman forecast. Growth in the city’s property values can support a larger levy at a lower rate.
A peak in the rate is not a promise that your bill will fall. Your bill uses assessed value; the Charter cap uses market value.
| Fiscal year | Gross levy | Rate / $1,000 RMV |
|---|---|---|
| 2032–33 | $374.1M | $1.69 |
| 2040–41 | $412.7M | $1.36 |
These are nominal dollars and annual medians from 10,000 economic scenarios, not a single household’s forecast. The median RMV rate peaks at $1.69 in FY2032–33; benefit payments and total levy dollars follow different paths. The calculation includes PERS contributions and other fund costs.
Milliman’s January 28, 2025 presentation uses June 2024 data. The City’s September 2026 presentation reuses that analysis; it is not a new valuation. The City lists the next levy analysis update for January 2027.
Milliman, printed slides 28 and 30 (PDF pp. 29 and 31) · City, slides 11–14
Legacy benefit payments are projected to crest in the mid-to-late 2030s and then decline gradually. PERS contributions and other fund costs continue.
Milliman, printed slides 5 and 10–12Milliman’s model stays within the levy cap through FY2043–44 in over 98% of 10,000 scenarios. That tests payment capacity—not whether taxes are affordable or other services are protected.
Milliman, printed slide 30The model varies inflation, market values and Oregon PERS investment returns. It does not vary every risk: property-tax law changes, workforce changes, demographic surprises, and market-linked changes in compression or delinquency are among the exclusions. The result covers FY2025–2044, not all future years. Milliman, printed slides 20–23 and 30.
Portland already prefunds newer workers’ pensions. Moving older pensions to an invested reserve changes when residents pay and which risks they bear.
Higher taxes, cash diverted from other priorities, or debt to repay.
A cost residents bear nowEarnings can help pay benefits. Losses can leave taxpayers with more to cover.
Returns are uncertainFuture residents could pay less. Poor results could leave them covering a shortfall.
The outcome depends on returnsPreserve resources for other priorities and avoid the transition cost of building a reserve for a plan already closed to new hires.
Build invested assets whose earnings could reduce future tax contributions and provide a reserve for future payments.
Pew supports prefunding as standard practice and recommends comparing the costs of catching up now. This diagram is the Lab’s synthesis, not a quantified proposal. Pew, pp. 6–7 and 12 · Machiz’s case for funding reform
Compare three illustrative return assumptions. These calculations show cash contributions—not which policy delivers the best economic value.
Each constant return is assumed known in advance; contributions are recalculated. These are illustrations, not forecasts.
Use borrowed money in these illustrations?
Bond: 5.5% over 25 years; repayments included. GFOA recommends against pension-obligation bonds.
Prefunding compared with annual funding · cash through 2082
Less cash is not proof of better value. These totals exclude the opportunity cost of paying earlier. Even 0% is a constant-return illustration, not a stress test.
Choose an illustration above to inspect the annual costs and assumptions.
Includes the September 16, 2026 Council packet. The Milliman slides in that packet are dated January 2025 and use June 2024 data. Audited finances run through June 2025.
Audit balances, adopted budgets and certified tax rates.
The City's rate forecast and the actuary's levy scenarios.
Household growth assumptions and this page's funding simulator.
The June 2024 actuarial valuation reported a $3.91B accrued liability. The FY2024–25 audit reports a $3.36B total pension liability at June 2025. These measurements use different dates and valuation roll-forwards. The audit identifies a higher discount rate as a major reason for the decline; it does not mean hundreds of millions were newly saved or benefits were cut. The updated page uses the latest audited figure. Audit, pp. 10–12 and 25.
Kevin Machiz’s published analysis advocates prefunding. It is cited as a source; he is not credited as a co-author or independent reviewer of this page. Pew’s advice to compare funding approaches, the City's assessment of payment capacity and transition costs, and GFOA's position against pension-obligation bonds, are presented alongside it. The comparison and decision questions are the Lab’s editorial synthesis. No independent actuarial review of this page’s teaching model is claimed. The evidence does not establish one optimal policy.
