Here's why:
* Cleary's own life: Beverly Cleary lived in Portland for many years, and her books are often considered semi-autobiographical.
* Details in the book: The book describes elements that are specific to Portland, such as:
* The "Rose Festival"
* "The Oregon Historical Society"
* "The Willamette River"
* "The Portland Zoo"
While the book doesn't explicitly state the location, the numerous details about Portland strongly suggest that's where the story takes place.