Council debates whether to use Prosper Portland's Strategic Investment Fund to backfill general-fund cuts

Prosper Portland staff and City Councilors engaged in an extended budget discussion about the agency's financial posture and whether the Strategic Investment Fund (SIF) should be used to replace general-fund reductions to economic-development programs.

Shay Flerty Bettine, interim executive director of Prosper Portland, said the agency has used an arm's-length structure to deliver real estate and lending tools, and that SIF is intended as a revolving loan corpus to create citywide capital that TIF can't. "One of the benefits of having a quasi governmental agency... is that we do manage our own systems, which means having our own procurement, our own specialized legal team that specializes in real estate transactions and business lending," she said.

Councilors pressed the agency over SIF balances and recent growth in non-TIF funding sources. Tony Barnes, Prosper CFO, said about $10 million in loan commitments had been made from SIF in the prior year and that the fund's beginning balance and spend profile have shifted as projects close.

Several councilors proposed amendments or asked staff whether SIF could be repurposed to backfill general-fund reductions affecting small-business supports, events, workforce development, and district supports. Councilor Greene said she planned an amendment that would reduce Prosper general-fund allocations while directing a SIF transfer to make those programs whole at FY24-25 levels; she framed the move as aligning with Advance Portland priorities to center BIPOC communities. Council members and Prosper staff debated whether council direction to use SIF would be advisory to Prosper's board or a direct budget action; staff noted council has formal authority over the budget committee process, while board-level policy governs SIF deployment and required returns.

Small-business programs and grants were a central issue. Councilors described the repair-and-restore grants, Reimagine Oregon cannabis-derived small-business funds, and the Inclusive Business Resource Network as high priorities. Prosper leaders said the agency moved quickly to deploy a one-time $7.0 million round of Reimagine funds and that ongoing reimagine funding is targeted to about $1.3 million in the coming year. Councilors and Prosper CFO agreed to provide line-by-line detail to help council consider narrower choices.

Bottom line: The work session concluded with councilors signalling several planned amendments: some to restore repair-and-restore and event stabilization grants with one-time funds, and one notable proposed amendment to use SIF transfers to make Prosper's general fund whole. Prosper leaders warned that rapid spend-downs of SIF would undermine the fund's revolving purpose and long-term returns; councilors said they will evaluate targeted transfers and expect follow-up analyses.