Over the last number of years, I’ve been following our city’s budgeting process rather closely. I find it interesting how each of our elected officials navigate the process in their own unique ways. However, calling it a process may be giving it too much credit as it sometimes looks more like a game of whack-a-mole. Each player (councilmember) taking turns trying to pummel anything that puts its head above the surface. No real integrated strategy is used other than who can react the quickest to the latest set of circumstances.
I particularly enjoy listening to the city council discussion during the budget deliberations. Each year what I find most interesting is what is not said from the dais. This year was no exception.
Did we ever hear from the dais how the proposed budget will affect the taxpayers? I haven’t. It has not been said. So, I’ve taken the liberty to distill the tax implications now that they are about to adopt the budget on Tuesday. There are two decisions that the administration and city council have made that impact our taxes the most. Fortunately, both must become ballot measures where our voices are finally heard. More on that later.
On Tuesday, the city council will formalize their decision to join the South Snohomish County Regional Fire Authority (RFA) through annexation to offload the city’s responsibility to pay for these services. They have also decided to ask the voters to raise our property taxes to bring in an additional $6 million a year in new revenue. Both of these measures were needed and used to balance the budget. Yes, we have a financial problem, in case you didn’t already know.
What does this all mean in dollars and cents to us? This graphic may be the most useful:
Highlighted in the graphic are the levy rates from which our city-related property taxes are based. Multiply these rates by the assessed value of your property, divided by 1,000, and you get the tax you owe the city. Currently we pay a total city-related levy rate of $1.02 per thousand dollars of assessed valuation. In the future, the EMS levy would go away if we join the RFA and would be replaced by the RFA levy rate (2024 rate shown). The new budget also includes a levy lid lift rate that brings in $6 million of additional revenue. As proposed by the city, our city-related tax bill would increase by about 134%. I think you get the picture.
As an example, a million-dollar house currently pays $1,020 per year to the city. If adopted as proposed, that would go up to $2,390, a $1,370-per-year increase. And at these rates, you can almost be assured that landlords will be passing it along to their tenants in the form of rent increases. Nobody escapes the tax man.
These are difficult times for our city and we need to make difficult decisions. Our elected officials will be throwing the ball in our court, that of the voters, to have a say in the decision. In April, the RFA annexation and its tax consequences will be a ballot measure. In August or November, the levy lid lift will be another ballot measure. I would encourage us all to become well informed as we plot the future of our city and how to pay for it. What services and service levels can we afford? What are the alternatives?
— By Jim Ogonowski
Jim Ogonowski lives in Edmonds.
thanks for the graphic, Jim, that illustrates the City Council and Mayor’s strategy for gigantic tax increases. What ever happened to the practice of incremental increases? The City hired a lot of new people in 2023. Now they’re trying to find the money to pay for their wages and benefits. i’ll be voting ‘no’ until the alternatives have been vetted.
Other cities have managed to afford the RFA as it is the least expensive alternative. This delusion of a choice that is good and cheap fails to recognize that the city was raiding the general fund to pay for what other municipalities pass directly to the beneficiaries. In other words, Edmonds was shifting what rightfully should be passed to residents that enjoy the services towards moneys collected by sales taxes and other fees. This was never sustainable. It was done to artificially benefit property owners at the expense of the city’s long term financial viability. Basically Edmonds property owners will finally pay what they actually use instead of shifting the burden elsewhere including small business that are taxed enough already.
The RFA has a $10mill+ deficit, owes the City of Edmonds $7mill+ that is refusing to pay us, and is charging us a higher amount/capita than it’s charging other clients. They expect us to GIVE them real estate that we may be able to buy back at a price they give us ( not the customary “pay for capital improvements”), which are extortionate terms.
When it comes to investments, most entities, be it pension plans, states, localities, etc, are only allowed to invest in entities that are considered a low risk with high ratings, going concerns ( at a minimum), etc. RAF is not looking to control its costs, has a deficit, refuses to pay its debts, and seems to have a pay scale far above that of similar entities, and thus, it is not a good investment.
I am aware of the precarious financial position we’re in, and think that when it comes to sifting between which services to keep and which to contract out or eliminate, we ought to keep what’s critical to our existence ( first responders), and to reduce admin positions. It’s not easy, to make these decisions, but there we are, and it must be done.
Does anyone know if the RFA taxes and/or benefit charges are reduced/deferred under the State’s low income/disabled/senior property tax reduction/deferral program? As far as I know, it is unclear which property tax types (voted, non-voted, whatever) are reduced/deferred. If these new charges are going to fall on those participating in the program, it would be very unfortunate.
Any possible tax relief will unfortunately be restricted to seniors with incomes below a specified threshold. Regardless of age or limited income, renters will not benefit from these allowances and will have to shoulder the entirety of these substantial tax increases in their monthly rent.
Lora, the pieces of the taxes that are eliminated by the senior tax exemption program are the voter-approved taxes. So for the upcoming tax increases in Edmonds, that would be the City’s levy lid lift, and about 25% of the RFA’s taxes. In addition, all Edmonds school district taxes are eliminated, since they are voter-approved. The tax assessed value of the property is also reduced, so that has the effect of reducing all other taxes by a little bit. ( It’s important to explain that the senior tax deferral program does NOT reduce any taxes. It just delays when they have to be paid to be the date you sell the house. And you have to pay interest on that deferred amount. ). In the tax exemption program, the homeowner has to submit their application every three years. So it’s something you have to continue to work on for as long as you own the house. Homeowners can get help applying from volunteers at the Edmonds Waterfront Center or the customer service staff in the County Tax Assessor office in Everett.
Most regressive idea ever? Thanks Theresa. For a million dollar (median around here?) home/property owned by an extremely low income homeowner that purchased years ago, even with the exemption/defferal program providing 25% less RFA fees, the owner could lose 2-3% of annual income the first year of annexation ($720 against an average social security income of $2000 per month, more recent retirees and those with additional income may be closer to 2% than 3%, perhaps). It seems likely that RFA costs will increase faster than incomes for retired people, so we should perhaps assume things will get increasingly worse over time for retired property owners. (And, as one comment mentioned, renters). Newer owners, with annual incomes of, say, $180,000 and up (or whatever it takes to get a home loan in recent years), face a mere 1/2% of income for the RFA, and income increases likely to be closer to the RFA cost increases. More costs for those least able to afford it? Do I misunderstand?
Thanks Lora for the explanation!
Ms. Petso that is a very good question and your concern is appreciated. That would indeed be unfortunate for those folks on the program. It is also disappointing that some current city councilmembers and officials seem more interested in promoting the RFA and new taxes than asking these types of questions.
Folks, since last year, some City Council Members have “pushed” the RFA as it is the easiest way to pull the City partially out of the estimated $20M hole that Nelson’s admin and part of Rosen’s administration has dug. Rosen for delaying staffing issues like paying out extra “severance pay” when NOT in the contracts. While I am no longer part of Council, the lack of transparency has become paramount regarding the financial situation of the City and not including the public. Where are the “public invited” work group like we had in 2009 or 2010 when we needed a levy back then? Fortunately, former Mayor Earling hired Scott James who understood the need for policy compliance and transparency of financials and worked tirelessly with financial minded Council Members or citizens to ensure the public understood the need for furloughs, or controlling the expenses (saved $1.M on fire) complying to policy. Last year, a fiscal emergency was resolved and yet, we’ve seen no effort on Council’s part to work with the public or administration to curtail expenses or publically investigate Plan A, B, C, or D? Instead we get “fearful” media releases like our Police will be outsourced or if the RFA does not pass, we will be without fire service? Vote NO on any RFA and force Council to do their oversight job!
“Stop the crazies” was Mayor Mike Rosen’s campaign slogan. Today, we still have the “crazies” but now the “crazies on steroids”! What happened? We traded one Mayor Mike (Nelson) for another Mayor Mike (Rosen). Mayor Nelson hired 50 new employees in 2023 and Mayor Rosen refuses to layoff any of these 50. Instead he and council have decided to shift the budget crisis to the taxpayer by promoting annexing Edmonds to the Regional Fire Authority (RFA). In negotiating for Edmonds Mayor and Council agreed to transfer two of our fire stations to RFA and giving the land away by Quick Claim Deed to them – millions of dollars of property Edmonds paid for. Once transferred to the RFA, likely we’ll never get it back – its FOREVER. The negotiating team consisted of Mayor Rosen, CP Vivian Olson, Neil Tibbott and Attorney Tarady – only they forgot whose team they were on since they gave it all away to RFA. Tomorrow, Dec. 17, they will vote whether to put the RFA annexation on the April ballot – offloading the city’s responsibility to pay for these services – putting the problem on the taxpayer. Three councilmember’s election campaigns have been supported by firefigthers (RFA) – Neil Tibbott, Chris Eck, and Susan Paine. You’ve seen the firefighter endorsement signs on their campaign yard signs, check the PDC. 1/2
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Jim Ogonowski is correct, I’ve never heard from the dias how the proposed budget will affect the taxpayer. Instead we’ve heard how it is “heartless” to layoff any city employee. What about the taxpayer? Look at Ogonowski’s graph. If annexed to RFA taxes on a $1 million home will increase by $960/yr. Additionally, council will put a $6 million levy lid lift on the 2025 ballot and another in 2026. They are desperate to shift the burden of balancing the budget onto the taxpayer instead of doing the necessary work. On Dec. 3 10 residents spoke in person, three on the monitor, countless emails sent to mayor and council, and a petition with 90 resident signatures voicing opposition to annexation to RFA at Council Hearing. Not one person spoke in favor. Administration isn’t listening.
Who is the taxpayer? The taxpayers are senior citizens many on fixed incomes, families with children whose children’s futures administration is stealing from, veterans – some disabled. The lines at the Edmonds Food Bank continue to grow. Snohomish County just passed a 4% property tax increase (County Council members Nate Nehring and Sam Low saved us from the 8% proposed and which Strom Peterson was in favor of), Gov. Ferguson just announced a $12 BILLION shortage. Vote No on RFA annexation, future levy lid lifts. Insist administration do their job.
Theresa, it seems that unlike the corporate chart we’re shown where the residents of Edmonds are first in importance, in real life, more often than not, we’re ending up last.
The RAF needs our money, it’s not paying us back what’s owed, the Mayor prefers to tax us some more instead of taking measures that he is obligated by his position to take, and we’re told to give up real estate, pay double for crucial services contracted out, rather than contracting out/ eliminating non-essential jobs… all at additional costs to us. This is called Princess math… what we need is cost-cutting, strengthening crucial, first-responder services, and eliminating jobs that are not as needed through attrition and severance, or placement.
The decision makers on this issues who refuse to tighten the belt, encourage us to contract out crucial services but keep non- crucial jobs and not cut costs, are not working in our interest, but against them.
Naive questions because I have not been following this issue closely enough, and I know others here have the ability to provide an overview: (1) what are the consequences of not joining the RFA? This article presents some data about the consequences of joining, but I’m curious about the other side of this too, as we seem sort of between a rock and a hard place. (2) If the RFA alternative is to re-start an Edmonds FD, that seems like a multi-year process that could easily cost more than joining the RFA, and almost certainly would not provide an equivalent level of service to the RFA. What am I missing in that? Appreciate any insights you all can provide.
Steve — reporter Larry Vogel provided a good summary of the issues in this story last week:https://myedmondsnews.com/2024/12/council-to-begin-deliberations-tuesday-on-regional-fire-authority-annexation/
Right, I read that one last week. Thanks for the reminder. The only options I’m seeing listed there are (1) RFA annexation; (2) continue contracting with the RFA for emergency services (seems dubious); or (3) restarting the Edmonds FD (seems dubious on such a short timeline, and IMO, service is almost certainly not equivalent or could easily cost more than RFA annexation). We seem to have several pretty terrible alternatives, all of which are going to cost the City a lot more than we’re currently paying. The monetary consequences of RFA annexation are presented above, but how much is it going to cost us if we don’t proceed with RFA annexation? Has that been evaluated? I’m just wondering if there are any viable alternatives to joining the RFA–at least short term–without losing local emergency services? Seems like the RFA made some recent concessions (on stations and apparatus) that may make a short term annexation appealing while we study the cost and feasibility of restarting the Edmonds FD. Are there other options?
Hi Steve, costs are one aspect, local oversight is another. Edmonds will not have voting representation on the board (unknown ETA). Another board member is a retired fire fighter.
As the City Attorney mentions in link below, many ‘cost unknowns’. Total costs for SCF / RFA below. Tried to provide links when I can find.
2024: Costs: $11.5 M
https://myedmondsnews.com/2024/09/edmonds-council-supports-retaining-property-tax-dollars-learns-city-likely-to-miss-comp-plan-deadline/
2026: Costs:$19M – $20.7M (City Atty. est.)
https://myedmondsnews.com/2024/12/edmonds-city-council-reviews-details-of-regional-fire-authority-annexation-plan/
In addition to increase costs in 2026, we lose EMS transport credit dollars, transfer titles of 2/3 fire stations to RFA.
City has communicated, if RFA fails, city would extend contract with South County Fire (SCF is the RFA). Although Edmonds consultant provided a cost estimate for a City Fire Department in my view, it would be a long term effort, ground up thinking. It would be very difficult to start a city department if we annexed into RFA.
https://dpa730eaqha29.cloudfront.net/myedmondsnews/wp-content/uploads/2024/05/Fitch-Final-Report-full-doc-reduced.pdf
In 2016 the same consultant suggested prioritizing medical resources vs fire (24′ Fires = 8%), Staffing paramedics only, at 1 / 3 stations, with a savings at the time est. at $1.5 – $2M (we had to submit public record request, I can provide?)
Time Magazine highlights fire costs, a fire chief took bold decisions to alleviate tax burden on community. It’s interesting article that illustrates imbalances in the fire fighting model across the country.
https://time.com/6097414/wildfires-firefighters-spending/
Hello Steve,
Good questions. Citizens have ask me similar as they “fear” if the RFA is voted down, we will have no fire/medic service which is so untrue!
Vote NO RFA and make Council do their job working with the Administration on contract options. These options should have been brought forth in recent fire consultant (Fitch LLC) report if an update of previous report had been scoped. Instead the Council President ignored Council protocol and created a narrow scope himself which was analyzing RFA annexation: so that money was wasted. Having said that the original report provides many alternatives, and citizens like Darrol and Jim have provided many examples to save money to the Mayor/City Council.
It is obvious City Council is “awaiting” the RFA annexation ballot measure to pass prior to engaging with the public or being fiscally transparent and inclusive. So, folks – keep involved and spread the word: vote NO on the RFA ballot measure.
Don’t buy into the “fear” that we will lose fire service as State laws prevent this from happening. Make Council/Administration do their job and start an “open dialog with citizens” by creating “expense/levy” committees where ALL citizens can participate.
All these “expense reduction plans” like RFA or selling Police MUST be part of a public discussion rather than made behind closed doors.
Simply: Vote NO RFA!
“They are desperate to shift the burden of balancing the budget onto the taxpayer instead of doing the necessary work. ” This! Vote No on RFA and Lift.