Commentary: An Edmonds Kind of Perspective – Part 1

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Phil Lovell
Phil Lovell

This writing is the first of three in a series that I’ve been formulating in my mind for several years now. The theme is Edmondsour city, where we’ve been, where we are now, and where we want to go from here. I hope to focus on the latter category within my remaining two proposed articles.

First off, it’s fair to say that the most all of our citizens love Edmonds as home. My wife and I love Edmonds and have been living here for over 20 years. It’s a beautiful waterfront city with a ‘village character’ which includes a diversity of people, features, benefits, programs, all of which we would like to have in the future. However this desired maintenance or preservation of our current status as a city (third largest in Snohomish County) with a small-town feel is becoming more and more challenging, and to some of us, downright frustrating.

The historic evolution of Edmonds from a small town on Puget Sound to our current size and configuration has occurred over several generations since our founding in 1890, largely through the early-on efforts of many individual, community, and governmental leaders. Currently however our collective ability to preserve Edmonds’ character is greatly impacted primarily by economic conditions in our country and region. This situation becomes magnified through our political process. Two of these major economic conditions are wealth inequity and cost escalation. Put in other terms:

  • A relatively small group of people and entities either own or control the vast majority of wealth in our country; Edmonds is a part of this. This situation plus middle class ‘stagnation’ and political polarity at both federal and state levels are inhibiting overall growth from potentially benefiting the broadest spectrum of our society.
  • The cost of everything is high and costs keeps going up! The U.S. Government puts the cumulative rate of inflation in our country between 1960 and 2000 at almost 500 percent, and between 2000 and 2015 another 39 percent on top of that.

In Edmonds if we look at these two factors alone it’s clear that those “old days are over” in expecting individuals or community groups to implement major investments in our physical infrastructure—a lot of which we apparently want for Edmonds; more of this in my next two articles.

Now let’s “zero in” on Edmonds in consideration of these conditions outlined above. The picture is clearer when we look at specific demographic and economic data.

First, population and income: Per U.S. Census data of 2013 the average age in Edmonds was 48.1 years, substantially higher than the countywide average of 37.5 During the period 2011-2013 Edmonds’ median household income was $67,228 per year, compared with Snohomish County at $67,192 (s: American Community Survey 3-yr. 2011-2013). While not as high as King County average [$70,998], it’s reasonably safe to conclude that Edmonds generally has a relatively older and more affluent population which creates a demand for a wide variety of goods, services, and activities. (s: Edmonds Comprehensive Plan, 2015) However younger families are locating in Edmonds in part to escape higher real estate costs in King County.

Second, residential taxes: Per the Snohomish County Assessors Annual Report for 2015 our stats are as follows:

  • Edmonds real estate tax levy rate for 2015 is $10.895/$1,000 of assessed value (A/V). Currently, this is the 6th lowest rate in the county. This tax rate (levy rate) is calculated annually by dividing the amount of tax funds to be raised by the total assessed value of all taxable property within the district. Washington legislative action of 2007 limits this regular (non-voted) combined property tax increase to 1 percent per year.
  • The average real estate tax per Edmonds residence for 2015 is $4,300.06. This average is the 3rd highest in the County—How can this be, you ask?

This disparity exists primarily due to the relatively large quantity of high-cost single-family residential units (including condos) in Edmonds, many of which house retirees. In 2015 the average home value in Edmonds is $394,700, second highest in the county (although considerably behind Woodway). And, by the way, the current average home value this year is still over 14 percent lower than the high point in 2008 prior to the “great recession.”

Third, voter-approved property tax measures for capital purposes: Again, according to the County Assessor’s report, the last non-school-related bond measure approved by Edmonds was in 1996 (for our Public Safety complex). Does this represent the rate of growth we want or need on behalf of capital infrastructure in Edmonds? Note that only slightly more than 19 percent of all those collected RE taxes come to the city along with bits and pieces from other county allocations. In the meantime, we’re limited to a 1% tax increase each year without a voter-approved over-ride or a bond levy, and costs keep going up! The city’s strategy for many years been vigorous budget management coupled with cuts to staff and services to overcome revenue shortfalls resultant from the recent major recession. While the overall economy is slowly recovering, we’re still not back to our “pre-recession’”level and working hard to maintain budget targets.

This very roughly summarizes the economic picture in Edmonds at the moment. In my next two writings I want to focus more specifically on our expressed desires for sustainable preservation and growth in Edmonds. I’m also urging all of us all to think more productively as to how we can begin to achieve same.

— By Phil Lovell

Phil Lovell, P.E., MASCE retired in 2003 as Vice President of the Turner Construction Company. Since then he has been heavily involved in volunteer civic efforts, both at the State and local levels. He is continuing executive member of the UW Construction Industry Advisory Council, serves as Vice Chair of the Puget Sound Transit Citizen Oversight Panel, and is a 6-year member and past chair of the Edmonds Planning Board. Most recently, he has been appointed to the Mayor’s advisory task force to study alternatives to the at-grade railroad crossings in downtown Edmonds. These writings represent his views as a private citizen.

 

10 COMMENTS

  1. I agree that this letter by Phil provides taxpayers of Edmonds a lot of valuable information not previously published on this site.

    Readers should particularly take note of his comments about City of Edmonds property taxes. In particular that the tax rate used each year is inversely proportional to the total assessed value of properties – as the value of properties goes up, the tax rate goes down; as the value of properties goes down, the tax rate goes up. That is a result of Initiative 747 passed in 2001, and enacted by the legislature in 2007, “which restricts taxing districts to a 1% monetary aggregate increase over their prior highest lawful levy”. For Edmonds taxpayers, that restriction applies to about 75% of your City of Edmonds property taxes. The other approximately 25% is the EMS levy of 50 cents per $1,000 of assessed value that was approved some years ago by voters; since the EMS taxes vary directly with property values, they’ve been increasing the past couple of years as property values have been climbing.

    I look forward to reading the future articles mentioned by Phil.

  2. Wouldn’t it be more appropriate to look at the real estate tax millage rate? This is the amount used per $1000 of property tax collected.

  3. A point in the real estate taxes that I have found interesting, and unfair, is how they are levied on new construction. The county assesses the taxes on July 1st of each year. Thus, for new development if the developer waits until after July 1st to “complete” the house, the property is taxed as a vacant lot for the subsequent year. That is, a house built in 2015 but “completed” after July 1st only pays taxes for a vacant lot in 2016. I called the Snohomish County assessor’s office one year and asked why the people in a home worth a half million dollars or more got, basically a year and a half of massively reduced real estate property taxes and was told that the system was set up to assess taxes based on the property as of July 1st. It seems to me that it wouldn’t be to difficult to change this system so that after the home is completed and sold to set up the real estate taxes based upon the new home at that time.

    • I believe that most of your comments are factual with the exception that the assessment date for new construction is July 31st, and I’ll add that the assessment date for existing properties is January 1st – for example Jan 1, 2015 for taxes due in 2016..

      Your proposal seems to be reasonable, but I don’t know how practical it would be to implement it. I suggest that you propose it to the county assessor’s office; they’ll respond to you as I’ve found the staff to be very responsive and helpful.

  4. Thanks, Ron. I did suggest it to the county and was told they wouldn’t change it. They are the ones that told me the July date (although it could be the 31st and I might be remembering wrong); even for existing property. They explained to me that they send someone out to drive around and view the property from the street as well as look at recent sales when coming up with values for existing property. Which is why it seemed logical to me to use the sale of new construction as the basis for its’ tax assessment rather than just sticking to the value of a vacant lot. It might be an issue that our elected officials need to address. This change would certainly result in more tax revenue for the city and county.

  5. This is an excellent article! The cost of preservation is high – but the cost of not preserving and improving capital infrastructure is higher! Here is an interesting set of statistics that speak to the affluent nature of our zip code!

    Poverty rates in Edmonds

    Residents with income below the poverty level in 2013:

    Edmonds:
    4.6%
    Whole state:
    10.6%

    Residents with income below 50% of the poverty level in 2013:

    Edmonds:
    2.2%
    Whole state:
    4.6%

    Poverty rate among disabled males:

    Edmonds:
    5.3%
    Washington:
    13.9%

    Disability rate in this city among poor males (it is 16.9% among residents who are not classified as poor):

    Edmonds:
    21.7%
    Washington:
    13.9%

    Poverty rate among disabled females:

    Edmonds:
    6.0%
    Washington:
    18.1%

    Read more: http://www.city-data.com/poverty/poverty-Edmonds-Washington.html#ixzz3jSSPFWal

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