NEW ISSUE -- Negotiated BOOK-ENTRY ONLY RATING: Moody’s A1 In the opinion of K & L Gates LLP, Portland, Oregon, Bond Counsel, interest on the 2010 Series A Bonds is included in gross income subject to federal income taxation. In the opinion of Bond Counsel, interest on the 2010 Series A Bonds is exempt from personal income taxation by the State of Oregon. See “TAX MATTERS” herein for a discussion of the opinion of Bond Counsel. In the opinion of K & L Gates LLP, Portland, Oregon, Bond Counsel, assuming compliance with certain covenants of the City, interest on the 2010 Series B Bonds is excludable from gross income of the owners of the 2010 Series B Bonds for federal income tax purposes under existing law. Interest on the 2010 Series B Bonds is not an item of tax preference for purposes of the federal alternative minimum tax imposed on either individuals or corporations and is not included in adjusted current earnings for the purpose of computing the federal alternative minimum tax imposed on certain corporations. In the opinion of Bond Counsel, interest on the 2010 Series B Bonds is exempt from personal income taxation by the State of Oregon. See “TAX MATTERS” herein for a discussion of the opinion of Bond Counsel. City of Portland, Oregon $29,645,000 $35,280,000 North Macadam North Macadam Urban Renewal and Urban Renewal and Redevelopment Bonds Redevelopment Bonds 2010 Series A 2010 Series B (Federally Taxable) (Tax Exempt) Base CUSIP 736746 DATED: Date of Delivery DUE: June 15, as shown on the reverse hereof The North Macadam Urban Renewal and Redevelopment Bonds, 2010 Series A (Federally Taxable) (the “2010 Series A Bonds”) and the North Macadam Urban Renewal and Redevelopment Bonds, 2010 Series B (Tax Exempt) (the “2010 Series B Bonds”) (collectively, the “2010 Bonds”), will be issued in registered book-entry only form, without coupons, in denominations of $5,000 or integral multiples thereof. The 2010 Bonds, when executed and delivered, will be registered in the name of Cede & Co., as the registered owner and nominee for The Depository Trust Company, New York, New York (“DTC”). DTC will act as securities depository for the 2010 Bonds. While Cede & Co. is the registered owner of the 2010 Bonds (the “Owner”) as nominee of DTC, references herein to the Bondowners shall mean Cede & Co., as aforesaid, and shall not mean the Beneficial Owners of the 2010 Bonds. See APPENDIX H—“BEO SYSTEM” herein. MATURITIES, AMOUNTS AND INTEREST RATES AS SHOWN ON THE REVERSE HEREOF Interest on the 2010 Bonds is payable semi-annually on June 15 and December 15 of each year, beginning December 15, 2010. While the 2010 Bonds are in book-entry form, interest on the 2010 Bonds will be paid through DTC. See APPENDIX H—“BEO SYSTEM” herein. The 2010 Bonds are being issued to repay outstanding balances on lines of credit established for the North Macadam Urban Renewal Area (the “Area”), to fund the First Reserve Subaccount Funding Requirement, and to pay issuance costs. THE 2010 BONDS ARE SPECIAL, LIMITED OBLIGATIONS OF THE CITY SECURED SOLELY BY AND PAYABLE SOLELY FROM THE NORTH MACADAM TAX INCREMENT REVENUES. THE 2010 BONDS ARE ADDITIONALLY SECURED BY AMOUNTS CREDITED TO THE FIRST BOND RESERVE SUBACCOUNT, AS PROVIDED IN THE BOND DECLARATION. THE 2010 BONDS ARE NOT GENERAL OBLIGATIONS OF THE CITY OR THE PORTLAND DEVELOPMENT COMMISSION, AND ARE NOT SECURED BY OR PAYABLE FROM ANY FUNDS OR REVENUES OF THE CITY OR THE PORTLAND DEVELOPMENT COMMISSION EXCEPT THE NORTH MACADAM TAX INCREMENT REVENUES AND AMOUNTS IN THE APPLICABLE RESERVE SUBACCOUNT. The 2010 Bonds are subject to optional redemption prior to maturity. See “THE 2010 BONDS—REDEMPTION OF THE 2010 BONDS” herein. The 2010 Bonds are offered when, as and if issued by the City and accepted by the Underwriters, subject to prior sale, withdrawal or modification of the offer without notice, to the final approving opinion of K & L Gates LLP, Bond Counsel, Portland, Oregon, and to certain other conditions. Certain legal matters will be passed upon for the Underwriters by their Counsel, Orrick, Herrington & Sutcliffe LLP, Portland, Oregon. The City expects that the 2010 Bonds will be available for delivery through the facilities of DTC in New York, New York on or about September 23, 2010. BofA Merrill Lynch Citi Official Statement Dated September 15, 2010 MATURITY SCHEDULES $29,645,000 North Macadam Urban Renewal and Redevelopment Bonds 2010 Series A (Federally Taxable) Due Principal Interest Price or CUSIP No. June 15 Amount Rate Yield 736746 (1) 2011 $2,865,000 2.571% 2.571% UR7 2012 2,155,000 2.821 2.821 US5 2013 2,220,000 3.200 3.200 UT3 2014 2,290,000 3.610 3.610 UU0 2015 2,370,000 3.960 3.960 UV8 $13,730,000 5.374% 2010 Series A Term Bonds due June 15, 2020; Yield 5.374%, CUSIP Number (1) 736746 UW6 $4,015,000 5.574% 2010 Series A Term Bonds due June 15, 2022; Yield 5.574%, CUSIP Number (1) 736746 UX4 $35,280,000 North Macadam Urban Renewal and Redevelopment Bonds 2010 Series B (Tax Exempt) Due Principal Interest Price or CUSIP No. June 15 Amount Rate Yield 736746 (1) 2022 $2,570,000 3.75% 3.91% UY2 2023 3,525,000 3.75 3.99 UZ9 2024 3,655,000 5.00 3.91† VA3 2025 3,840,000 4.00 4.12 VB1 2026 3,995,000 4.00 4.17 VC9 2027 4,150,000 4.00 4.24 VD7 2028 4,320,000 4.25 4.36 VE5 2029 4,500,000 5.00 4.28† VF2 2030 4,725,000 5.00 4.38† VG0 (1) Registered Trademark 2010, American Bankers Association. CUSIP data is provided by Standard & Poor’s CUSIP Service Bureau, a division of McGraw Hill Companies. † Priced to par call on June 15, 2020. OFFICIAL STATEMENT OF THE CITY OF PORTLAND MULTNOMAH, WASHINGTON AND CLACKAMAS COUNTIES OREGON $29,645,000 $35,280,000 North Macadam North Macadam Urban Renewal and Urban Renewal and Redevelopment Bonds Redevelopment Bonds 2010 Series A Bonds 2010 Series B Bonds (Federally Taxable) (Tax Exempt) CITY COUNCIL Sam Adams, Mayor and Commissioner of Finance and Administration Amanda Fritz, Commissioner No. 1 Nick Fish, Commissioner No. 2 Dan Saltzman, Commissioner No. 3 Randy Leonard, Commissioner No. 4 CITY OFFICIALS LaVonne Griffin-Valade, City Auditor Eric Johansen, City Treasurer Linda Meng, City Attorney Kenneth L. Rust, Chief Administrative Officer Richard F. Goward, Jr., Chief Financial Officer PORTLAND DEVELOPMENT COMMISSION Scott Andrews, Commissioner and Chair John C. Mohlis, Commissioner and Secretary Charles A. Wilhoite, Commissioner Steven Straus, Commissioner Vacant, Commissioner Bruce Warner, Executive Director Julie V. Cody, Central Services Director & Chief Financial Officer BOND COUNSEL K & L Gates LLP Portland, Oregon No dealer, broker, salesperson or other person has been authorized by the City of Portland (the “City”) to give any information or to make any representations, other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by the City. Bond Counsel’s review of this document is limited; see “LEGAL MATTERS” herein. This Official Statement has been deemed final as of its date by the City pursuant to Rule 15c2-12 of the Securities Exchange Act of 1934, as amended. This Official Statement speaks only as of its date, and the information contained herein is subject to change without notice. Certain statements contained in this Official Statement are projections, forecasts and other statements about future events. These statements (“Forward Looking Statements”) are not statements of historical facts, and no assurance can be given that the results shown in these Forward Looking Statements will be achieved. See “FORWARD LOOKING STATEMENTS.” All estimates set forth herein have been made on the best information available and are believed to be reliable, but no representations whatsoever are made that such estimates are correct. So far as any statements herein involve any matters of opinion, whether or not expressly so stated, they are intended merely as such and are not representations of fact. The Underwriters have provided the following sentence for inclusion in this Official Statement. The Underwriters have reviewed the information in this Official Statement in accordance with, and as part of, their respective responsibilities under federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information. This Official Statement does not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of, the 2010 Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. In making an investment decision, potential investors must rely on their own examination of the City and the terms of the offering, including the merits and risks involved. These securities have not been recommended by any federal or state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this Official Statement. Any representation to the contrary is a criminal offense. In connection with this offering, the Underwriters may over allot or effect transactions which stabilize or maintain the market price of the 2010 Bonds at a level above that which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued, and if discontinued, then recommenced, at any time. TABLE OF CONTENTS INTRODUCTION....................................................................................................................................................................