Bureau of Environmental Services — Part 1 of 2

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Bureau of Environmental Services Public Works Service Area Bureau of Environmental Services Priya Dhanapal, DCA - Public Works Dawn Uchiyama, Director Bureau of Environmental Services 17.1% City Budget 82.9% Funds Management 4.5% Other 14.1% OandM - Collection System 8.2% OandM - Treatment 9.4% Strategy 5.3% Business Support 8.6% Capital Program Mgmt and Controls 49.9% Bureau Overview Requested Revised Total Change from Percent Requirements FY 2024-25 2025-26 Prior Year Change Operating $1,589,165,749 $1,209,665,016 $(379,500,733) (24)% Capital $281,292,000 $229,976,120 $(51,315,880) (18)% Total $1,870,457,749 $1,439,641,136 $(430,816,613) (23)% Authorized Positions 655.00 663.00 8.00 1.22% 8 City of Portland, Oregon - FY 2025-26 Requested Budget

Bureau of Environmental Services Public Works Service Area CityofPortland BureauofEnvironmentalServices Director DawnUchiyama DeputyDirector TingLu Business Technical Engineering Strategy& Treatment Watershedand Services Services Services IntegratedPlanning andPumpingO&M CollectionO&M Supv—FarshadAllahdadi Supv—DanBauer Supv—PaulSuto Supv—KristenAcock Supv—JoeDvorak Supv—Vacant Health,Safety,Security& InformationSystemsand EngineeringBusiness PortfolioManagement CIPPMO FinancialServices Operations CollectionSystem Environment MappingDivision Operations Supv—JoshRobben Supv—MurielGueissazͲTeufel Supv—KenBartocci Supv—RobGeorge Supv—AmberClayton (Interim) Supv—LaurenWilcox Supv—BaronHowe Supv—KimGarcia AssetManagement Environmental Sewer,Stormwater& Supv—ShannonAxtell SupportServices WatershedO&M Communications RevenuePrograms InformationDivision RestorationDesign Supv—MiaSabanovic Supv—RyanDurocher Supv—MeganCallahan Supv—SherriPeterson Supv—LindaScheffler Supv—ShahrzadDey RegulatoryDivision Supv—KaitlinLovell Treatment& Maintenance CommunityPartnerships AdministrativeServices Compliance PumpSystems Supv—ChristaOverby Supv—ChenoaPhilabaum Supv—LynneCasey Supv—MattCriblez Supv—BhargaviAmbadkar EnvironmentalRemediation Supv—DawnSanders(Interim) Construction& Contracts Inspection Supv—AndiGresh Supv—ToddPerimon(interim) RiskAssessmentDivision Supv—ShannonReynolds MaterialsTestingLab Supv—ViolaLai PlanningDivision Supv—Elisabeth ReeseCadigan TheBureauofEnvironmentalServicesisamissionͲdriven,highͲperformance organization,leadingtheCityinpreservingandrestoringthehealthof Portland’swatersheds. ContactChristine.Clark@portlandoregon.govwithupdatesorquestionsaboutthischart. UpdatedFebruary10,2025 City of Portland, Oregon - FY 2025-26 Requested Budget 9

Bureau of Environmental Services Public Works Service Area Bureau Summary Bureau Summary Bureau Mission The Bureau of Environmental Services’ (BES) mission is to manage Portland’s wastewater and stormwater infrastructure to protect public health and the environment. We are a mission-driven, high-performance organization, leading the City in preserving and restoring the health of Portland’s watersheds. Bureau Overview The Bureau is located within the Public Works Service Area along with the Portland Water Bureau and Portland Bureau of Transportation as a result of the citywide government transition. The bureau operates and maintains Citywide sanitary sewer and stormwater collection systems and serves a population of approximately 650,000. The bureau is also the City’s lead agency for watershed protection, restoration, and recovery of threatened salmon and steelhead species. The bureau is funded primarily by retail sewer and stormwater charges, wholesale contract revenues from surrounding jurisdictions, system development charges, and reimbursements for services provided to other bureaus. Executive Leadership Dawn Uchiyama, Director Ting Lu, Deputy Director Major Work Groups Director’s Office. Provides high-level leadership, strategic guidance, and oversight, including communications; equity; health, safety, security; and capital improvement program management. Business Services. Provides accounting; budgeting; financial management; billing and collections; financial assistance support; contracts and business opportunities for minority-owned, women-owned, and emerging small businesses; human resources and training; facilities management; and loss control. Engineering Services. Designs and constructs capital projects; provides inspection, materials testing services, and bureau-wide engineering support. Treatment and Pumping Operations & Maintenance. Operates and maintains the Columbia Boulevard and Tryon Creek wastewater treatment plants. Collection System and Watershed Operations & Maintenance. Leads operations, maintenance, and stewardship of grey (pipes, pump stations) and green (green streets, natural areas) systems and assets. 10 City of Portland, Oregon - FY 2025-26 Requested Budget

Bureau of Environmental Services Public Works Service Area Strategy and Integrated Planning. Establishes bureau priorities; promotes coordinated decision making and investment strategies; oversees compliance with major regulations; leads the bureau’s planning efforts for systems and assets; and provides bureau-wide modeling support. Technical Services. Provides scientific expertise and technical support to colleagues, projects, and programs; stewards technology infrastructure; and supports protection of assets, the environment, and surface and ground waters through development, implementation, and enforcement of regulations. Recent Accomplishments Secondary Treatment Expansion Program. Columbia Boulevard Wastewater Treatment Plant, which is essential to protecting the health of our community and waterways, is undergoing its largest improvement project since the 1970s. Completed in December 2024, though still requiring additional investment, the project added new solids processing facilities, as well as many other improvements to increase the plant’s resiliency, protect water quality, and provide healthier work environments for our employees. BES is committed to Rise Up, a campaign to shift the culture of construction to be more inclusive for a diverse workforce. Implementation of sewer and stormwater rate methodology changes. With assistance from the Portland Water Bureau, began several initiatives in July 2024 recommended in a 2023 rate study and approved by City council. The study updated stormwater billing methodology to align rates with the cost of providing services and match peer agencies; expanded Clean River Rewards discount program to increase eligibility and to align with new billing methods; eliminated sewer conversion, line/branch charges to lower sewer connection costs; and updated system development charges. Settlement Agreement for Columbia Slough. Signed in May 2024 with DEQ to address environmental contamination and improve watershed health in the Columbia Slough in exchange for release of the City from State of Oregon claims. The agreement includes funding for in-water sediment cleanup, habitat restoration, investigation of upland contamination sources, treatment facilities construction, and basin evaluation. North Portland Road Temporary Alternative Shelter Site (TASS) Opened. The Mayor’s Office led an effort to site a new shelter for unhoused individuals on BES property adjacent to the Columbia Boulevard Wastewater Treatment Plant. This was a fast-moving project with many moving parts. BES led technical work and coordination with the DEQ Cleanup Program to ensure that legacy contamination doesn’t pose significant risks to human health and the environment. Updated BES capitalization policy. New capitalization policy will help BES more accurately recognize the true life cycle cost of our assets; this allows us more flexibility in funding future capital work down the road. Financial sustainability is our goal and a strong bond rating (which is supported by strong accounting compliance) allows us to borrow funds at an optimal rate. City of Portland, Oregon - FY 2025-26 Requested Budget 11

Bureau of Environmental Services Public Works Service Area Challenges and Opportunities Opportunities Public Works Integration. As the Bureau integrates into a Public Works Service area, there are many opportunities to deepen collaboration with the Water and Transportation bureaus, especially in the  areas of capital project planning and construction, asset management, customer service, external funding, and community engagement. One Water. In August 2024, Portland launched the One Water Initiative to explore integrating its water, sewer, and stormwater services into a unified, sustainable system. One Water emphasizes collaboration and efficiency, ensuring safe, affordable, and reliable water services, and aligns with the City’s broader reorganization efforts. The review brought together Water, Environmental Services, PBOT, Parks, and Planning & Sustainability, leading to three key recommendations:  • Stronger collaboration across Public Works.  • A unified strategic plan to improve service delivery.  • An integrated Capital Improvement Plan for smarter investments.  Over the next five years, the City will implement these recommendations while preserving each bureau’s expertise, ensuring a more connected and efficient water system for Portland’s future. Tryon Creek Wastewater Treatment Plant Transition. In early 2024 the City of Portland (BES) and the City of Lake Oswego concluded the preliminary services phase of our project to replace the aging Tryon Creek Wastewater Treatment Plant. Lake Oswego has released an RFP in 2025 to identify and secure a contractor under a Public-Private-Partnership (P3) model and hope to finalize a contract by Fall 2025. Challenges Aging Infrastructure. Upgrading aging infrastructure to protect public health and the environment in the face of financial constraints is a challenge faced by many utilities across the nation. Portland’s two treatment plants and many of its nearly 100 pump stations — all critical pieces of infrastructure — need large-scale reinvestment. Increased costs associated with inflation, supply chain issues, and labor shortages have significantly increased the cost of capital projects. Financial and employee resources are being prioritized in the areas of highest risk. Capital Investment Backlog. The bureau has identified a large backlog of maintenance needs. Fiscal planning for certain significant key infrastructure replacement and upgrade investments are too early in planning and design to determine high-confidence cost estimates. City Government Cost Increases and Policy Decisions. In recent years, city general government costs including general fund overhead and central city interagency agreements have increased considerably and placed upward pressure on the bureau budget. At the same time, City Council has reduced the recommended rate of increase for utility rates, hampering BES’ ability to address other necessary expenditures. 12 City of Portland, Oregon - FY 2025-26 Requested Budget

Bureau of Environmental Services Public Works Service Area Inflation. Costs have increased dramatically since the beginning of the COVID-19 pandemic on all items, impacts are still being felt on multiple parts of the organization. Utility increases, particularly for electricity and natural gas, have risen far faster than inflation. Regulatory Compliance. BES is responsible for managing several environmental permits that ensure the City of Portland complies with the Clean Water Act, the Endangered Species Act and Safe Drinking Water Act. These regulations define our wastewater and stormwater requirements and our risks. Regulations associated with these permits are likely to increase in the future, increasing mandatory costs of the bureau. Recent federal government funding decisions amplifies uncertainty related to regulatory compliance and federal funding. Remediation Settlements. Pending remediation settlements are sizeable and have been determined to be operating expenses. If the settlements come in higher than currently planned, operating expense reductions or increases to rates beyond expected levels will be required to meet revenue bond coverage targets. Recruitment, Retention, Training, and Succession Planning. These staffing issues are not specific to BES but are key challenges for the successful function of the bureau. These issues are particularly prevalent for wastewater treatment and pumping operators, electrical and instrumentation technicians, engineers, and accounting positions. To address these challenges the bureau is working with the Bureau of Human Resources and union partners in developing programmatic approaches such as the newly developed BES Wastewater Operator-in-Training program that starts this fall and is looking to retraining and redeployment opportunities to address the highest risks. Coming to City Council The Carolina Trunk project is anticipated to come to City Council in 2025. The project will replace 1,600 feet of a major 60 year-old sewer line, a portion of which runs under Interstate 5. This project is anticipated to cost $60 million and scheduled to be completed in early 2027. Five-Year Priorities  Shifting capital investments to wastewater treatment and pumping and facilities portfolios.  Shifting operating budgets to prioritize greatest risks, such as increasing need for contingency planning, emergency repairs of failing assets, or additional customer outreach when proactive replacement has been delayed. Long-Term Financial Outlook To keep rates of increase stable, predictable, and as low as possible, the bureau maintains a balanced forecast over the 30- to 40-year horizon. Although the forecast is balanced, significant unfunded needs will require trade-offs. With combined City utility rates increasing, ratepayer affordability is an ongoing concern. City of Portland, Oregon - FY 2025-26 Requested Budget 13

Bureau of Environmental Services Public Works Service Area Performance Measures Actuals Actuals Target Target Strategic Performance FY2022-23 FY2023-24 FY2024-25 FY2025-26 Target Efficiency Amount of time loss, in hours per employee, due to injuries and illnesses 1.32 2.17 2.00 0.00 0.00 Cost to operate and maintain the treatment plants per million gallons treated $1,099 $0 $1,234 $0 $0 Outcome Number of combined sewer overflow events 4 3 4 0 0 Number of participants in community events, workshops, stewardship, and 8,782 11,908 7,000 0 0 restoration events Number of sanitary sewer overflows 136 134 140 0 0 Number of stormwater flooding events due to system capacity 112 95 80 0 0 Sanitary Sewer Overflows per 100 Miles of Main 3 3 5 0 0 Watershed Health Index for water quality 5.40 5.40 5.50 0.00 0.00 Percent of dollars awarded to disadvantaged, minority-owned and women- 35.0% 35.9% 30.0% 0.0% 0.0% owned(D/M/W) firms in professional services Percentage of industrial enforcement tests in full compliance 99.0% 98.5% 99.0% 0.0% 0.0% Average single family household bill as a percent of median income 1.27% 1.31% 1.25% 0.00% 0.00% Output Amount of wastewater processed annually (in million gallons) 25,504 25,649 30,000 0 0 Feet of streambank restored (not cumulative) 2,980 285 12,000 0 0 Linear feet of sanitary and combined sewer pipe repaired or replaced to 24,641 20,399 65,000 0 0 improve condition and capacity Number of bureau education programs delivered 343 321 400 0 0 Number of education and engagement activities and events about Portland 43 0 56 0 0 Harbor Superfund Number of green streets inspected 2,522 2,523 2,800 0 0 Number of lab analyses performed each year 56,389 54,330 55,000 0 0 Number of trees planted 7,712 14,476 5,750 0 0 Percentage of biochemical oxygen demand removed 93.0% 0.0% 85.0% 0.0% 0.0% Quality Tons of biosolids beneficially used 11,400 0 14,000 0 0 Maintain bureaus combined first and second lien debt service coverage ratio at 1.39 1.47 1.47 0.00 0.00 1.3 or greater Maintain the bureaus first lien debt service coverage ratio at 1.5 or greater 8.59 6.46 6.05 0.00 0.00 Construction management costs as a percentage of total construction costs 13% 98% 12% 0% 0% Percent of CIP budget spent 93% 85% 87% 0% 0% Percent of methane beneficially used 30% 0% 95% 0% 0% Percentage of urgent public health and safety related service requests 95% 95% 90% 0% 0% responded to within two-hour timeframe Percent of BES building permit reviews that meet the City’s turnaround goals 95.0% 99.0% 85.0% 0.0% 0.0% for reviewing permits Percentage of Level I/Phase I Environmental Assessments completed on time 70.0% 59.0% 85.0% 0.0% 0.0% 14 City of Portland, Oregon - FY 2025-26 Requested Budget

Bureau of Environmental Services Public Works Service Area Summary of Bureau Budget Requested Requested Actuals Actuals Revised No DP Total FY2022-23 FY2023-24 FY 2024-25 2025-26 2025-26 Resources External Revenues Miscellaneous Fund Allocations 0 0 14,204,964 0 0 Licenses & Permits 2,045,980 1,848,374 1,966,000 875,000 875,000 Charges for Services 415,151,876 425,190,398 428,233,591 462,958,847 461,845,847 Intergovernmental 427,377 771,554 1,733,677 463,500 463,500 Bond & Note 531,666,437 0 289,000,000 0 0 Miscellaneous 10,432,833 16,099,346 16,203,500 14,383,000 14,383,000 External Revenues Total 959,724,502 443,909,672 751,341,732 478,680,347 477,567,347 Internal Revenues Fund Transfers - Revenue 398,570,616 463,609,283 748,095,246 501,916,019 501,916,019 Interagency Revenue 1,974,994 2,847,307 1,628,045 6,895,080 6,895,080 Internal Revenues Total 400,545,610 466,456,590 749,723,291 508,811,099 508,811,099 Beginning Fund Balance 390,571,780 0 369,392,726 453,262,690 453,262,690 Resources Total 1,750,841,892 910,366,262 1,870,457,749 1,440,754,136 1,439,641,136 Requirements Bureau Expenditures Personnel Services 98,590,718 109,306,380 116,916,681 126,720,933 126,238,856 External Materials and Services 105,618,301 118,953,173 138,108,731 129,736,236 128,623,236 Internal Materials and Services 49,622,752 58,961,326 71,861,974 70,026,450 70,464,590 Capital Outlay 158,405,920 204,008,323 213,769,067 164,118,473 164,118,473 Bureau Expenditures Total 412,237,691 491,229,203 540,656,453 490,602,092 489,445,155 Fund Expenditures Debt Service 369,267,396 142,429,776 154,843,698 149,380,059 149,380,059 Contingency 0 0 392,643,029 294,617,605 294,661,542 Fund Transfers - Expense 406,635,738 474,954,876 758,532,877 498,840,658 498,840,658 Debt Service Reserves 0 0 23,781,692 7,313,722 7,313,722 Fund Expenditures Total 775,903,134 617,384,651 1,329,801,296 950,152,044 950,195,981 Ending Fund Balance 562,699,454 0 0 0 0 Requirements Total 1,750,840,279 1,108,613,854 1,870,457,749 1,440,754,136 1,439,641,136 Programs Funds Management 409,457 333,371 22,099,995 22,215,000 22,159,350 O&M - Collection System 31,048,300 36,090,990 38,342,869 40,069,950 40,069,950 Strategy 12,732,304 20,737,617 27,764,996 26,135,503 25,935,503 Administration 2,496 4,914 — — — Asset Systems Management (11,112,983) (10,878,044) — 358,627 358,627 Bureau Support 632,489 793,941 — — — Business Support 47,962,677 52,903,691 51,769,700 42,807,336 42,055,796 Capital Program Mgmt & Controls 236,713,709 284,206,579 295,618,509 244,601,168 244,335,020 City of Portland, Oregon - FY 2025-26 Requested Budget 15

Bureau of Environmental Services Public Works Service Area Summary of Bureau Budget Requested Requested Actuals Actuals Revised No DP Total FY2022-23 FY2023-24 FY 2024-25 2025-26 2025-26 Collection System 1,803,229 689,274 — — — Communications 1,186 79 — — — Construction Services 7,076 8,704 — 3,931 3,931 Del Prog - Env Compliance 7,466,198 8,330,299 9,283,598 9,416,806 9,416,806 Del Prog - Systems Dev 4,441,603 4,621,165 7,989,087 3,998,361 3,998,361 Design 5,748,060 6,579,325 2,229,578 1,834,823 1,834,823 Development Services — 25 — — — DP - Comm Partnerships 4,410,408 4,312,547 3,845,717 3,606,111 3,390,182 Employee Development 96,843 62,497 — — — Eng Svcs - Constr & MTL 4,170,919 4,578,022 560,616 2,314,880 2,314,880 Engineering 2,324 6,557 — — — Env. Monitoring & Investigation 49,023 211 — — — Environmental Compliance (5,817) 409 — — — Finance 515,391 5,000,155 — — — Information Management 280,748 73,459 — — — Integrated Planning 6,546,544 7,240,625 11,484,571 9,207,574 9,107,574 Leadership 3,585,924 4,799,564 6,712,752 8,496,815 8,929,145 Maintenance 541,781 767,858 — — — Materials Test Lab 72,342 34,884 — 5,396 5,396 O&M - Treatment 28,570,203 32,674,378 42,827,768 45,779,674 45,779,674 O&M - Watershed 6,074,645 6,411,831 7,348,333 12,663,935 12,663,935 Portland Harbor 4,975 3,000 — — — Science, Fish & Wildlife 221 — — — — Sustainable Stormwater 88,302 1,102 — — — Systems Development 516,121 354,432 — — — Tech Svcs - Env Info 6,761,432 7,624,920 8,359,764 8,069,032 8,069,032 Tech Svcs - Info Sys, Map 8,435,623 9,277,625 4,418,600 9,017,170 9,017,170 Treatment 3,586,414 3,570,177 — — — Wastewater 46,705 2,272 — — — Watershed Management 21,828 8,932 — — — Watershed Revegetation 8,994 1,817 — — — Total Programs 412,237,691 491,229,203 540,656,453 490,602,092 489,445,155 16 City of Portland, Oregon - FY 2025-26 Requested Budget

Parent: Public Works Service Area · PDF: pp. 1155-1163