PORTLAND -- Mayor Charlie Hales gave his first state of the city address Friday afternoon at the Governor Hotel in downtown Portland.

During the speech he highlighted his priorities for the upcoming year.

He focused on the upcoming budget and the constraints the city faces, the funding crisis facing Portland schools, and reforming the culture of the city's police bureau.

Hales also pointed out that Portland is $21 million in the hole for 2013 with little in the contingency fund. He said a number a factors combined to drain that fund.

Hales will present next year's budget on Tuesday.

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