The Olympia City Council’s Finance Committee directed City Manager Jay Burney to explore other potential revenue measures beyond a levy lid lift to address a long-term budget shortfall in future years.
At the committee meeting on Wednesday, February 14, Burney cited the 10-year financial forecast showing the city will have recurring revenue shortfalls in future years even without adding new programs or services.
According to Burney, the budget sustainability problem stems from the state's 1% cap on annual property tax increases, a significant funding source for the city. He noted that many cities face the budget gap as the impacts of restrictive cap is "finally starting to catch up with cities in the long run."
Burney mentioned a "levy lid lift" as one potential option the city would likely consider to address the long-term budget gap. A levy lid lift would involve seeking voter approval to lift the 1% cap on annual property tax increases.
The city manager outlined a proposed calendar for the Finance Committee and the city council for budget sustainability discussions and potential solutions like a levy lid lift over the coming months.
Burney noted that the city's executive team would discuss the long-term needs and short-term 2025 budget impacts at an upcoming retreat. He plans to update the Finance Committee in March after this meeting.
Asking the public for input
The committee would then provide initial 2025 budget guidance and receive community feedback. This information will be presented to the full council at a study session in April.
The proposed calendar includes plans to hold public meetings over the next six months, conduct opinion polling through surveys, and host focus groups to discuss budget challenges and potential solutions.
The timeline is designed to allow a decision on whether to place a levy lid lift or other measure on the 2025 ballot by July, giving time for additional public education before any formal vote.
Committee member Clark Gilman inquired about other options with a similar amount of revenue generated that could stabilize the budget besides levy lid lift.
Burney recounted that they discussed some potential options in the January retreat, including implementing other revenue measures, such as raising municipal utility taxes - alongside a levy lid lift.
"That would lessen the amount we might need to do with levy lid lift. There are combinations of things that you could do,” said Burney. “But certainly, the biggest side that fully closes the gap is the levy lid lift. Any recommendation is most likely going to be looked in that direction."
Finance Committee Chair Lisa Parshley requested a brief review of all the potential revenue options. She wanted to make the council well-informed of the various options that could be considered.
Parshley also underscored the importance of the engagement process, adding that it was helping the community understand the "why" and receive feedback to shape the committee's decision. The chair wanted to ensure that any selected revenue option addressed the community's needs.
Burney agreed to include a review of all the revenue options in the early study session with the city council.
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BobJacobs
One wonders why this council has budget shortfalls every year and always looks only at tax increases as the solution, not expenditure reductions.
Bob Jacobs
Saturday, February 17 Report this
FordPrefect
Well stated Bob!
The city would also collect more tax revenue if it supported businesses downtown rather than pandering to drug addicts.
Saturday, February 17 Report this
wolfmanner
Yet these Socialist Marxists on the City Council keep getting elected. Go woke go broke.
Saturday, February 17 Report this
longtimeresident
Property taxes are already too high. What are they thinking!
Saturday, February 17 Report this
HaydeeLozano
I couldn’t agree more, Bob Jacobs. Expenditures like salaries are out of control for the amount/type of work performed. There are positions that have been created over the years (for one reason or another) that are not relevant any longer. Someone needs to analyze what positions do and whether they are needed any longer. Does middle management really need to exist? The new city hall is practically vacant after the Covid pandemic. Is that $25 million well spent? There has to be a different, better way to operate the City.
Saturday, February 17 Report this
northbeachcomm
Many of the Olympia City Council members are professional people still in the work force.
They forget that many people in Olympia are on fixed incomes, social security, etc.
Professional people get pay raises that conform to the huge jump in inflation costs, after the Pandemic.
Many people on Social security cannot afford to pay higher and higher taxes on their dwellings.
These retired people cannot get their real estate taxes lowered, because other family members may have their
names on the real estate parcel, etc.
So people on Social security are being forced from their homes! (I have seen this in our neighborhood!)
City council members never think of these issues. They just see their own pay checks getting higher and higher.
One wonders when/if the voters of Olympia will recognize this.
One wonders when the voters will vote these people out of office.
The City council has to lower the city costs; we need expenditure reductions.
Are city buildings being used, are they empty, or can the City cut department staff?
Do we really need more and more city departments, to keep up with big cities like Tacoma?
We are not big like Tacoma. We cannot support larger city departments and agencies.
We need to lower costs in the City of Olympia, not raise taxes.
Please Olympia voters, wake up!
This is a town for rich people.
Rich people who get "Multi Family Tax Exemptions" (MFTE) from the City of Olympia, to build huge buildings,
while the rest of us have to pay the tax short fall. Wake up the voters of Olympia!
Saturday, February 17 Report this
KarenM
The Council and staff seem to have a common theme that the City needs to 'tell their story' and 'educate' the public about city finance problems. What I am not hearing in these discussions is the concept of reducing the size of some programs or ending some programs. The number of different programs and staff numbers have increased over the years. It is certainly possible that the public would be willing to see some reductions.
This isn't the same as 'efficiencies' which should also be examined.
Saturday, February 17 Report this
Cobbnaustic
I second that BobJacobs.
Saturday, February 17 Report this
JW
How about the city focuses on the core functions of fire, police, roads, utilities etc and cut everything else. There is so much fat to trim. Maybe the residents would buy in on a levy lid lift if it was coupled with the city transparently cutting costs.
Monday, February 19 Report this
Freebird
"Burney noted that the city's executive team would discuss the long-term needs and short-term 2025 budget impacts at an upcoming retreat. He plans to update the Finance Committee in March after this meeting". ---How about a zoom meeting?
“But certainly, the biggest side that fully closes the gap is the levy lid lift. Any recommendation is most likely going to be looked in that direction." -Burney ie...If we beg in just the right manner, the people will empty their pockets.
The city council needs to work within it's budget and learn how to trim the fat by getting rid of dead and/or unnecessary programs. They could try this for ten years and see just how creative they can be with the resources at hand. They continue to rob us and do not consider that we also need to exist...or perhaps they think that that is all we need to do. This extends to the schools and emergency entities. The passage of the Fire Dept levy gave one of my relatives a 90%, raise. This person is not firefighter. I said,
'You're welcome." This person already lives in a huge house in an upscale neighborhood. What kind of house do you live in? ...And how much longer will you be able to live in it--especially if you are on a fixed income. We already have too many homeless on the streets. So ask yourselves, "Do I want to keep encouraging the City Council to always assume we will pay for their next project.. or do I want to see them become accountable?" Let them have bake sales. No more taxes!
Tuesday, February 20 Report this
Dogmom
All of these comments are telling the real story. When are the people in this County going to vote people out of office that continually want to raise taxes instead of getting rid of waste and properly managing our money. It's about time we started voting people in office that know how to budget and concentrate on priorities instead of programs and administration salaries that take most of the money meant to help people. Does anyone ever do an audit on where all the money goes? I think not. Instead of a community board to oversee the police, how about a community board to be watchdogs on where our tax dollars are going.
Tuesday, February 20 Report this