Meeting until 11:30 p.m., the Edmonds City Council Tuesday night took several steps aimed at addressing the city’s challenging budget situation, including unanimous approval — following a public hearing — of a 1% increase in the city’s property tax, plus agreeing to use the city’s “banked capacity” from five years’ worth of property tax increases. These are tax increases the city chose not to assess at the time, but were “banked” and therefore available for future use.
The council’s action will increase the average homeowner’s property taxes by $35.49 annually. The council also unanimously approved a 1% increase in the emergency medical services (EMS) property tax levy — which will cost an average residence $2.40 annually. The EMS revenues may be used only to provide emergency medical care or emergency medical services, including related personnel costs, training, equipment, supplies, vehicles and structures.
The property tax increase was accompanied by promises from councilmembers to ensure the city helps those who need tax assistance, including seniors, those on limited incomes and residents with disabilities. You can learn more about property tax deferrals and exemptions on this Snohomish County Assessors webpage.
In addition, several councilmembers said that approving the property tax increase is just one step toward addressing the city’s budget woes, and pledged to take a close look at the 2024 budget to find cost savings.
Edmonds faces an ending fund balance of $6.64 million this year, requiring the city to dip into its reserves. The council held a special budget workshop last week to discuss possible solutions, including Mayor Mike Nelson’s proposal to transfer to the general fund budget $6.5 million in federal American Rescue Plan Act funds and $2 million from the building maintenance fund. The mayor has also proposed installing red-light cameras at six of the city’s most traffic crash-prone intersections, which he said will address traffic safety but is also projected to generate millions of dollars in revenue from violators.
In addition, the budget workshop included a conversation about whether the council should declare a “fiscal emergency,” as outlined in the city’s Fund Balance Reserve Policy approved by the council in 2019. Just prior to the workshop, the mayor sent a statement to the media blasting the council for considering such an idea, calling it a “scare tactic and political stunt.” His remarks angered some councilmembers, who said that collaboration — not conflict — was key to solving the city’s budget woes.
The idea of a fiscal emergency came up again at Tuesday night’s council meeting, with councilmembers considering two separate resolutions aimed at allowing the city to use general fund operating reserves for 2023 general fund expenses. The main differences between the two proposals: The first resolution, proposed by Councilmember Diane Buckshnis, included references to the city declaring, recognizing and approving a fiscal emergency. The second resolution, prepared by City Attorney Jeff Taraday, eliminated the term fiscal emergency altogether and instead referred to a “structural budget deficit.”
The council had a lengthy debate over which resolution to use. There was also a revelation that prior to Tuesday’s meeting, Edmonds Mayor Mike Nelson had proposed forming a task force of city councilmembers and staff to examine options — other than his draft 2024 budget — to address the revenue shortfall. Councilmember Dave Teitzel then made an amendment to Buckshnis’ resolution to create by Oct. 31 a budget task force, comprised of three councilmembers and selected members of the city administration, “to identify solutions to the structural budget deficit (the gap) in the proposed 2024 budget.” These solutions, the amendment stated, “should not include as an option use of all remaining ARPA funds to close the budget gap” — a concept that some councilmembers have opposed.
Teitzel’s amendment was approved, but a vote on Buckshnis’ amended resolution failed to pass following a 3-3 tie vote, with Councilmember Jenna Nand abstaining.
That led Buckshnis to propose amendments that removed all references to the term “fiscal emergency” from her resolution. Following the last-minute wordsmithing, councilmembers agreed by a 5-2 vote to place the amended measure on a future council consent agenda, giving them time to read the final version prior to approving it.
At the end of the discussion, Council President Neil Tibbott called the mayor’s offer to form a task force “a generous and collaborative effort.” Councilmember Chen added that the task force is a good next step. “Our true intent is to solve problems,” Chen said.
The council also held a public hearing about city revenue sources. Prior to opening it up for public comment, Administrative Services Director Dave Turley explained the city’s revenue situation, noting that 25% of city’s revenues come from property taxes but those have remained “extremely flat.” In the past, the city has been able to rely on sales and use taxes — which make up about 21% of city’s budget — but those have also been anemic in recent months. In addition, real estate excise taxes are lower than in past years.
During the hearing, Edmonds resident Darrol Haug — who also sits on the Edmonds Economic Development Commission — shared that Shoreline has a citizen-based effort to create long-term revenue forcasting. Haug noted that not all sales tax revenue is created equal, adding that the sales tax from one mid-size car equals 8,000 Dick’s hamburgers.
Councilmembers’ discussion about city revenue sources led to a long debate about the mayor’s proposal to install red-light cameras at six intersections identified by Edmonds police as dangerous areas for pedestrians and vehicles. Councilmember Nand asked Turley how the city came up with its estimated revenue from the cameras and whether the city had anticipated how the possibility of thousands of violations monthly would impact Edmonds Municipal Court. Turley explained that the city is starting with five school-zone cameras in January, with warnings issued that month and tickets given in February. After that, the same vendor that installed the school-zone cameras would install the red-light cameras. Revenue projections are based on the $130 fee that Lynnwood assesses violators and assume the red-light cameras would be online for half a year — with a $130-per-ticket fee based on data Lynnwood generates. Lynnwood generates $3.5 million in red-light camera revenue annually.
Nand reiterated her belief that many drivers dislike red-light cameras so much, they will avoid driving through Edmonds as a result
In other business, Nelson proclaimed October as National Arts and Humanities Month, which was followed by a report on the Edmonds Creative District.
It’s been five years since the city was certified as the state’s Creative District, and Edmonds is now applying for recertification.
Arts and Culture Manager Frances Chapin told the council that the certification “clearly points out the economic impact of the creative sector.” There are now 13 certified creative districts statewide, and eight more pending.
The Edmonds Creative District has a 21-member advisory committee that includes a range of arts and cultural representatives in the city. They are working to define the Creative District’s goals for next five years, with core values and guiding concepts that include:
Collaborative – City departments and local businesses/nonprofits
Inclusive – Envisioned as a “hub and spoke” model, the CD is a central catalyst tied to other parts/neighborhoods of the city
Intentional visibility of arts and culture – The community intentionally incorporates creativity as a priority in programs and projects
Also on Tuesday night, there was a budget request from Community, Culture and Economic Development Department Director Todd Tatum, who made his case for $183,000 to fund a grant specialist. According to the proposal, the new position would focus on “preparing grants for multi-modal infrastructure and on preparing a cross-department grant-writing work plan to support the city’s most strategic initiatives.”
Councilmember Buckshnis said that given the city’s budget troubles, she would prefer hiring a consultant for grant-writing assistance rather than adding a new position. Councilmember Dave Teitzel added he’s unsure whether he will support the request and wants to ensure the person will brings in enough money to justify it. Councilmember Nand asked Tatum if it would be possible to reclassify the grant specialist position to one that is more entry level so it could be offered at a lower salary range. Alternatively, she suggested the position could be shared and co-funded with other cities to save money.
The council was considering a special meeting next Monday, Oct. 30 to further discuss the budget, but agreed to forgo that meeting now that a budget task force is being formed. There is no council meeting on Tuesday, Oct. 31 as it’s the fifth Tuesday of the month.
— By Teresa Wippel