PORTLAND, Ore. — Since October, the Portland Bureau of Development Services (BDS) has cut 72 positions. The Bureau oversees building permits and inspections.
The cuts come at a time when construction has tapered off city-wide.
Unlike other city departments, the Bureau of Development Services relies on permitting fees to sustain itself.
"Our workload is down,” said Ken Ray, the spokesperson for Bureau of Development Services. “There is less permit activity coming in the door right now."
Over the past couple of weeks, the Bureau of Development Services notified around 15% of its staff — 56 employees — that they would be laid off at the beginning of 2024.
This comes as the Multnomah County construction industry lost 300 workers from Oct. 2022 to Oct. 2023.
With little new construction across Portland, there are some worried that there won’t be many new apartments, office space or other buildings in need of permits and inspections for more than a year.
"We did not anticipate — and I don't know anyone who did — anticipate quite the drop-off in permit activity that we saw over the summer," Ray said.
Ninety-eight percent of the bureau’s revenue comes from permitting, land-use review fees and other fees, Ray explained. Though, with little new construction city-wide, Ray said the department is losing money quickly: From July through October, the Bureau of Development Services withdrew around $3 million a month.
Without cuts, the department would run out of money next year, Ray warned.
"We're going to be watching our expenditures very closely through the rest of this fiscal year," Ray said.
Others said the layoffs are an early indicator of a city-wide economic downturn.
"It's a challenge," Mike Wilkerson, the director of analytics at Eco-Northwest, said.
He expects the economic downturn to last 18 months. Data this quarter shows the fewest number of permits for new apartments since the first quarter of the pandemic, Wilkerson said.
"Yeah, it's not ideal," Wilkerson said.
It’s not clear how many inspectors will lose their jobs within the Bureau of Development Services. Though with fewer staff, there are concerns that it could take longer for developers to get new buildings permitted and inspected.
"You hear frequently that the time for permitting, the processes, could be sped up,” Wilkerson said. “But I think when you have a bureau that's reliant entirely on fees, that's really challenging to do that."