A robust topic of discussion during Tuesday night’s Edmonds City Council Finance Committee meeting was the state of the city’s budget — and options for addressing ongoing financial issues.
The city had a much-smaller-than-anticipated ending fund balance for 2023, which prompted the council to declare a fiscal emergency in October. The challenges are anticipated to continue into 2024 and 2025, and councilmembers are starting to consider a range of options for addressing them.
“There’s no doubt that we’re going to have to talk about getting the imbalance corrected between the revenues and expenses. There’s only so much that you can cut,” Council President Vivian Olson said during the finance committee discussion. “We are definitely having to look at revenues, and I know it’s a really difficult and unpopular discussion to have.
“Our expenses as a city have grown and a lot of it is things that are truly essential,” she added.
“I’m really glad that we’re starting to have the revenue discussion,” said Councilmember Susan Paine. “My biggest worry is that we will be hanging on throughout 2024…but if we don’t start looking at 2025 that will be a huge hit on all of our budgets.” Inflation continues to increase, and “we will never be going backward,” she said. “Construction costs are astronomical…and we have other constraints as well.”
Councilmember and Finance Committee Chair Will Chen proposed the idea of a public safety levy — perhaps as soon as this spring — to ensure budget stability for 2025. “In 2024 we’re budgeting $17.5 million for police and $12 million for fire. They provide excellent service but we have to pay for it,” Chen said.
Turley listed three other options for raising money:
– Borrow money from the city’s utility fund, an idea the council considered but rejected during its 2024 budget deliberations.
– Sell councilmanic bonds with a 10-year bond issue, which the council could approve.
– Propose a one-year levy lid lift that would go before voters for approval. Read more about that option from the State Department of Revenue here.
Because the council is also looking into the idea of annexing into the South Snohomish County Fire and Rescue Regional Authority, Councilmember and Finance Committee member Jenna Nand directed a related question to Mayor Mike Rosen, who sat through all three virtual committee meetings Tuesday. She asked if he had spoken with South County Fire representatives about their willingness to help educate residents about the tax impacts if Edmonds considered annexation into the Regional Fire Authority (RFA). “My conversations with the RFA have been incredibly friendly and transparent and very open,” Rosen said. Noting that the fire authority was involved in helping neighboring jurisdictions when they went through recent annexation votes, the mayor added: “If council decides to advance the RFA…I promise you they will be actively involved.”
Council President Olson pointed out that any further direction on these options — or any other revenue ideas — would need to be discussed by the full council at a later date.
During the Council Public Safety-Planning-Human Services-Personnel Committee, Councilmember and Committee Chair Neil Tibbott and Councilmember and committee member Chris Eck approved moving to a future council consent agenda the addition of four buildings on the Edmonds Register of Historic Places.
The listing is an honorary designation denoting “significant association with the history of Edmonds,” Associate Planner Amber Brokenshire told the committee. Once the building is listed, the owner must request and receive a certificate of appropriateness from the Historic Preservation Commission prior to doing any work on the property.
The properties include those at 820 Main St., 820 Maple St., the Beeson House at 116 4th Ave. N., and the Schneider Building at 100 5th Ave. N. Brokenshire explained that the 820 Maple St. property was originally included on register in 2011, but was removed in 2018 when questions were raised about renovation work done on the home that had impacted architectural accuracy. After further review, the commission recommended reinstating the designation.
The committee also received a presentation from Bill Sturgeon of Fitch and Associates regarding a feasibility study the company is performing related to Edmonds fire and emergency services.
The goal, Sturgeon said, is “to come back with options so you (the council) can make informed policy decisions.”
The study will include establishing current and desired performance, a quantitative analysis of data and response times and risk assessment, the efficacy of both annexing into the RFA and starting the city’s own fire department, and the potential for contracting with another provider.
A presentation that includes Fitch and Associates recommendations is likely to come back to the council for review and consideration by April or May, Sturgeon said.
“We base all of our decisions and recommendations off data,” which uses South County Fire records, he added. Fitch is also interviewing stakeholders and will review all fire service agreements and contracts, as well as perform benchmarking based on demographics and community risks.
Among the areas covered: response time, risk asessment, the coverage area, equipment and resources, gaps or deficiencies in the current system. There will also be a cost analysis for different alternatives, including equipment and apparatus, personnel salary and benefits, facilities and infrastructure and any additional costs.
During the Council Parks and Public Works Committee, one of the notable items discussed was the release of an updated City of Edmonds Facility Condition Assessment, which was performed by consultant McKinstry.
Facilities Manager Thom Sullivan explained that McKinstry’s work includes a facility condition index, which focuses on the correction of deficient building systems and those at or near the end of their useful life.
The report contains detailed information for councilmembers to digest, and a full council presentation will be scheduled within the next month, he added.
The bottom line, Sullivan said, is that some of city’s “youngest buildings” are 20 or 25 years old, with the city’s average building age at 55. “We are kind of reaching some critical points” related to maintenance decisions, he added.
— By Teresa Wippel
Municipal Bonds are debt securities.
Councilmanic bonds are also known as limited tax general obligation (LTGO) bonds. LTGO bonds are issued by a vote of the legislative body rather than by a vote of the people. Per MRSC, because the voters have not been asked to approve a tax increase to pay for the principal and interest, general fund revenues must be pledged to pay the debt service on LTGO bonds.
MRSC states that it is important to note that LTGO debt does not provide any additional revenue to fund debt service payments but must be paid from existing revenue sources.
The cost of municipal borrowing is higher now than it has been for some time due to the Fed’s decision to increase interest rates.
Yet the council is chasing down a $37 million property. Where’s the budget, we can help balance.
Bonds are money that is borrowed and has to be paid back with added interest. Bonds are NOT revenue, they are DEBT. Going deeper in debt will not solve the city’s financial crisis.
Finance Committee chairman Chen is reported to have said the following: “Councilmember and Finance Committee Chair Will Chen proposed the idea of a public safety levy — perhaps as soon as this spring — to ensure budget stability for 2025. “In 2024 we’re budgeting $17.5 million for police and $12 million for fire. They provide excellent service but we have to pay for it Chen said”. So according to Chen if great service is provided taxpayers must pay whatever amount of money is requested for that service – no matter how unreasonable that may be. Chen is also the CM who cast a vote that has us in the Landmark property mess. Hopefully the full council will not routinely be taking his advice.
The HPC is doing tremendous work. We couldn’t be more pleased to have our house considered for inclusion on the registry (116 – 4th ave N – the Beeson House). The process was smooth and actually kind of fun to learn about. Edmonds is well served by this groups’ passion for the protection and preservation of our city’s charm and history. We’re lucky to have such dedicated volunteers. Thanks!
Great Coverage, Theresa! I agree with you Nathan, great work has been done with the HPC.
Regarding Finance comments made: it’s hard to agree that expenses are at “bare bones” when looking at the tremendous increase in consultants. Planning and Development’s 2024 actual estimates showed over $1.6MM for professional services which was higher than the horrendous $900K budget the majority of Council approved in 2023!
Maybe the new Mayor should hire an independent source (like Finch and Assoc.) to look independently at the budget and composition of the departments as the City is close to 300 employees with many new job descriptions. Also, what about all the soft cost by the three Directors (and staff) for the mess relating to the “Landmark purchase” which records will reflect no executive session was ever held to determine if the project should be pursued in the first place. There was NO executive session and yet, suddenly the CP and Mayor make a joint public announcement it’s happening without authorization or knowledge from Council. Now, no one claims ownership for negotiating the “$37 MM off-market” price, especially in a commercial real estate market that shows significant decline in 2023. These concerns are being pursued.
A levy is needed but it takes time and a collaborative task force to determine the necessary numbers for the proposition and that means transparency!
The budget discussion just shows that Edmonds is also circling the drain and going into the same spending pattern that the State and Federal governments got into. For what I understand, it’s still possible to reverse it. Therefore, I beg the current city administration to take the responsible steps to fix the mess before Edmonds falls into disarray.
Edmond’s City Government has been a disaster looking for a place to happen for years now, and not just the Nelson years. The only thing that prevented the building heights disaster of my youth and the Connector disaster of my “Golden Years” was an angry public finally crying out in anguish over what was being contemplated.
We do not have the general fund money to properly fix our parks and buildings now and we just did a major renovation of a perfectly good park that was way over budget, lost 2/3 of it’s past function, and created even greater maintenance cost requirements going forward. Yost Park, that should be our third only to the Salish Sea and the Marsh crown jewels, goes unfixed while some Council Members are currently suggesting we need to buy and take care of more parks and borrow money for the fixed and recurring expense of paying for fire service and public safety.
Folks, we are in deep trouble. City government, please start listening to our brilliant private citizens and community activists like Buckshnis, Scordino, Haug, Reidy, Olganowski, Tietzel and Hollis, all of whom comment here with smart advice that is too seldom taken. They don’t have all the answers but they have a pretty good idea of what NOT to do next.