OR: Trump funding uncertainty threatens rapid bus plan, other Portland climate projects

Several major climate projects planned by Portland’s clean energy fund, including a significant remake of 82nd Avenue, are at risk because it’s unclear whether millions of dollars from the federal government will materialize as expected.

Some of the projects rely on a federal match to cover up to half of the cost but the money – especially for work focused on climate, clean energy and communities of color – is now uncertain as the Trump administration reviews whether the proposals align with the president’s agenda, said Eric Engstrom, interim director of the Portland Bureau of Planning and Sustainability.

Among the projects potentially affected: a new rapid transit bus line on 82nd Avenue, community solar projects, electric car-related programs and the Portland streetcar fleet replacement, Engstrom said. All of those projects already have money set aside from the city’s clean energy fund.

The fund, seeded by a 1% surcharge on sales at large retailers in the city, was conceived to help protect low-income residents and people of color from the most severe impacts of climate change and help them make the transition to clean energy.

Trump has pushed eliminating funding for diversity, equity and inclusion programs and “Green New Deal” initiatives.

“Right now, I’m really nervous,” said Zachary Lauritzen, executive director of Portland-based nonprofit Oregon Walks and manager of the 82nd Ave Coalition that is championing the rapid bus line.

The line, expected to cost just over $300 million, received $55.5 million from the clean energy fund in December, in addition to money from Multnomah and Clackamas counties and Metro, among others. It requires a $150 million “Small Starts” grant from the Federal Transit Administration to start construction.

The bus line project will benefit one of the city’s most culturally diverse neighborhoods, will prioritize public transit and walking over cars and rely on hydrogen fuel-cell electric buses and tree planting to reduce greenhouse gas emissions.

And, it’s in a city that Trump has criticized in the past for racial justice protests and, more recently, for lawlessness.

“We’re in Oregon, that’s a strike against us; we’re in a highly diverse corridor, that’s another strike against us; and then it’s a transit project and Trump has shown very little, if any, interest and aggression towards anything that’s not automobile related,” Lauritzen said. “When you start adding up those things, it’s troubling. We’re recognizing that it could be tough to get this grant.”

Funding Pause

In January, Trump’s budget office issued a sweeping memo directing federal agencies to temporarily halt all grants, loans and financial assistance programs and review them for alignment with the president’s priorities, which include increased fossil fuel production, dissolving “the green new deal” and ending diversity, equity and inclusion efforts, among others. It’s part of a larger plan to reduce federal spending.

Though the memo was rescinded after it became the focus of two lawsuits, the administration said it is continuing the funding review to ensure federal spending complies with Trump’s executive orders.

Since then, two judges have blocked the funding pause, most recently earlier this month. The administration is expected to appeal the decisions and it’s unclear if some or all of the funding will be released and if so, when. In the meantime, federal agencies are continuing their funding reviews.

Last week, the administration issued a memo directing federal transportation officials to claw back grants for biking, walking, electric vehicles and other green infrastructure, including those that “improve the condition for environmental justice communities or actively reduce greenhouse gas emissions.” And the U.S. Department of Housing and Urban Development as part of its review has paused at least $60 million in funding for affordable housing retrofits that focus on installing heat pumps, solar panels or other clean energy infrastructure.

Thus far, the funding freeze has affected a wide range of programs in Oregon, from the Oregon Museum of Science and Industry to wildfire mitigation efforts to nonprofits that help immigrants. It also has led to uncertainty at myriad state agencies, including the Department of Environmental Quality, the Department of Energy and the Department of Forestry, which said they’re monitoring a number of federal grants linked to climate, clean energy and emission reductions.

In Portland, two bureaus have received the mammoth share of all federal grants. The Bureau of Transportation has collected about $163 million — nearly half of the city’s federal grants — and the Housing Bureau has received about $147 million, or 43% of the city’s total.

Transportation Bureau spokesperson Hannah Schafer declined to say whether any of the bureau’s current federal grants are frozen. “Things are moving and changing quickly” given court challenges and decision reversals made by the Trump White House, so the results are still unknown, she said.

“While any long-term impacts remain unclear, potential outcomes could be delays in reimbursements and project work, modifications in grant terms, or attempts at contract cancellations,” Schafer said via email.

Funding at Risk

Portland’s Bureau of Planning and Sustainability, which oversees Portland’s clean energy fund, declined to provide a full list of the fund’s projects that could lose federal grants.

“We’re working with grant recipients to understand the extent and specifics of the situation, as it’s evolving quickly,” spokesperson Magan Reed told The Oregonian/OregonLive.

Here are several other projects with funding that could be at risk:

• Portland streetcar replacement received $30 million from the clean energy fund to replace 12 aging streetcars scheduled to be retired by 2030. That is about one third of the $80 million cost. Portland’s Transportation Bureau officials declined to say how much in federal funding it needed to move forward with the project.
• The Bonneville Environmental Foundation plans to build a community solar project on Port of Portland and Metro properties using $31.6 million from the clean energy fund. The project, which aims to provide solar power to the region’s electric grid and utility bill savings to more than 1,500 low-income households in Portland, is also counting on $7 million from other funding sources. Some of that would come via federal solar tax credits that are part of the Inflation Reduction Act and whose future is uncertain under Trump. “We’re continuing to assess the situation and aren’t able to speak on the situation at this time,” said Evan Ramsey, the foundation’s senior director of the renewables program.
• The Energy Trust of Oregon’s Portland Solar for All project would support the installation of solar energy systems for about 1,350 low-income households in Portland. It received $25 million from the clean energy fund and plans to use an additional $18 million from a grant from the U.S. Environmental Protection Agency that was frozen last week but is available as of this week, said Oregon Department of Energy spokesperson Jennifer Kalez. But that could change, experts said. If federal funds are not available, Energy Trust said it will still move forward with the project though it will serve a smaller number of households.
• A program to offer financing tools to help lower-income residents and business owners reduce the cost of buying an electric car or truck received $35 million from the clean energy fund. It will funnel money to banks and nonprofits to reduce interest rates, offer matched savings programs and flexible lending. The program assumes people can offset the high costs of an EV via state and federal incentives, even though those incentives have dried up. The Oregon Clean Vehicle Rebate Program is closed for now and the federal tax credit for buying electric cars is likely to be rescinded by the Trump-controlled Congress.

What the City Can Do

Engstrom said the clean energy fund’s advisory committee and the City Council could decide to reallocate money from the fund to replace lost federal match dollars.

For instance, the fund’s five-year investment plan includes $20 million for bureaus to use when new federal or state funding opportunities related to clean energy and climate are announced.

Because the federal government appears unlikely to roll out those types of programs over the next four years, the money could serve as a “federal match replacement,” Engstrom said, though such a solution has yet to be formally proposed.

While that may help smaller projects that lose federal funding, the 82nd Avenue bus line would have to look elsewhere for help.

For now, though, the bus project is moving forward as planned, hoping the Trump administration will not eliminate its grant, said Lauritzen, the 82nd Ave Coalition manager.

“Transportation is the biggest emitter of greenhouse gases and we need to build infrastructure that gives people alternatives. Here’s an opportunity to get big dollars to make something happen,” he said.

“I’m certainly not anywhere near giving up hope,” he added, “but it would be a real setback if the project didn’t move forward.”

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