Elected officials weigh in at State of the Community event in Lacey

An annual gathering of elected officials served as a platform to showcase the successes local governments achieved last year, but it also laid bare the stark reality of having to deal with dicey financial issues.

The State of the Community 2026, which was hosted by the Thurston County Chamber and sponsored by Puget Sound Energy, took place before more than 250 attendees at Saint Martin’s University in Lacey on Wednesday, Jan. 14.

The event featured Thurston County Board of County Commissioners Chair Tye Menser, Lacey Deputy Mayor Malcolm Miller, Olympia Mayor Dontae Payne, Tenino Mayor David Watterson, Tumwater Mayor Leatta Dahlhoff and Yelm Mayor Joe DePinto.

Each of the elected officials was given a few minutes of time at the podium for opening remarks, in which they largely talked about accomplishments in their jurisdictions in 2025 with some light-hearted remarks and shout-outs woven in between.

The tone of the event got weightier when a group chat ensued and the subject turned to budgets. The most sombering picture was painted by Watterson, who said 2025 was a difficult year for Tenino.

While in his opening remarks he pointed toward milestones reached, such as the reconciliation of four years of budgets and the completion of Washington state audits for the same periods of time (2020-24), Watterson also referenced a financial reckoning related to the process.

The City of Tenino is on the hook for roughly $1.6 million stemming from debt identified through the reconciliation and audit work, something Watterson has previously noted in a message to Tenino residents.  That debt looms large for a city of 2,000 people with an annual general fund budget of approximately $2 million.

“We have a big chunk of money we have to start paying back,” said Watterson of the debt that is going to require staff to make some difficult decisions with respect to services the city provides, given the amount of money that needs to be repaid.

Leaders from other jurisdictions painted brighter pictures. Dahlhoff pointed toward robust sales tax intake.

“We are really, really strong with our sales tax revenue,” said Dahlhoff, adding the city’s numbers are looking good.  

DePinto struck a similar chord.

“Very fortunate with existing sales tax growth,” DePinto said.

When the group chat turned to the economy, Menser highlighted local businesses, utility investments, planned growth near Grand Mound and a habitat conservation plan, while Payne noted economic development strategies, possibly restarting Olympia Career Hub, a $2.6 million investment from Inspire Olympia to support nonprofits, as well as the downtown core.

“Make no mistake, downtown is thriving,” he said.

Miller was the last of the leaders to weigh in on the economy before the event sunsetted. 

He talked about how the City of Lacey is trying to make it easier for developers to get through the permitting process. He also said new hotels are a priority for the city, and that he would like to see entertainment options increase, possibly with new venues.

“I’m really trying to plant a seed right now,” Miller said.