Kent City Council members from left to right: Les Thomas, Toni Troutner, Brenda Fincher, Bill Boyce, Tina Budell, Satwinder Kaur and Dennis Higgins. COURTESY PHOTO, city of Kent

Kent City Council members from left to right: Les Thomas, Toni Troutner, Brenda Fincher, Bill Boyce, Tina Budell, Satwinder Kaur and Dennis Higgins. COURTESY PHOTO, city of Kent

Kent City Council, mayor plan new revenues, expenditure cuts to address upcoming budget shortfall

CAO Matheson summarizes proposal in email to city employees

The Kent City Council and Mayor Dana Ralph have come up with a plan and several options to address the city’s loss of about $10 million a year in state revenue over the next couple of years.

Chief Administrative Officer Derek Matheson sent the following email on Wednesday to city employees to summarize the plan by the mayor and council after their retreat last Friday at the The Platform Apartments rooftop meeting room in downtown Kent:

“Last Friday, Mayor Dana Ralph and the Kent City Council held a half-day retreat with the Mayor’s Leadership Team to follow up on a Feb. 3 retreat discussion about the fiscal cliff.

The mayor and City Council talked about the options available to manage the shortfall of $10 million a year caused by the loss of streamlined sales tax mitigation (starting in 2019) and the expiration of the Panther Lake annexation tax credit (in 2020). The city also has a structural budget deficit of about $2 million a year because our expenses grow at a faster pace than our revenues.

The mayor and City Council agreed to use a three-pronged approach to address the fiscal cliff and structural deficit:

• Increase revenues

• Reduce expenditures

• Reallocate revenues and/or expenditures between funds

Specifically, the mayor and council agreed to the following options to mitigate the fiscal cliff, including:

• Eliminate the sunset of a 2 percent internal utility tax, starting in 2019.

• Move most sales tax revenue from the capital resource fund to the general fund, starting in 2020.

• Move a 4 percent internal utility tax from the capital resources fund to the general fund in 2021.

• Move eligible costs to the criminal justice fund, starting in 2021.

• Avoid adding new positions or otherwise increasing expenses unless absolutely necessary.

There are two additional options that the mayor and council could implement:

• Raise the business & occupation tax and square footage tax to maximum allowable rates and place the new revenue in the general fund.

• Add a $20 vehicle license fee (through a Transportation Benefit District).

There are two further solutions the mayor and council could implement through a ballot measure:

• Increase the sales tax rate by 0.2 percent to generate approximately $5 million revenue.

• Allow property taxes to be raised more than the 1 percent per year allowed by state law (“levy lid lift.”)

Even with these options, it will still be necessary to reduce expenditures, but the mayor and council’s agreement to increase revenues and reallocate funds will significantly lower the amount of expenses that must be reduced.

As we said before, the fiscal cliff is a challenging situation. It will take hard work and sacrifice to come up with viable solutions. Throughout this process, we are committed to being transparent internally and externally, and the mayor and city council are committed to working together to find the best solutions for the city.

We are hosting three community meetings over the next several months to share this information with the public:

• Tuesday, March 27, 7 p.m., Trinity Church (3807 Reith Road)

• Saturday, April 21, 10 a.m., Sunrise Elementary (22300 132nd Ave. SE)

• Thursday, May 3, 7 p.m., Senior Center (600 E. Smith St.)

Mayor Ralph will present her 2019-2020 budget to the council in the fall. The council will review the proposal and vote on a budget in December.

More in News

Man charged with fatally shooting estranged wife

Tracked her to SUV in Kent shopping plaza

East James Street to close for construction July 21-Aug. 9

City urges drivers to use South 277th, 212th streets

Services set for longtime Kentridge High athletic director Anderson

Memorial July 22 at KR gym; mass July 23 in Renton

Puget Sound Fire call report

Number, type of incidents

The Carlton Complex wildfire burned in north-central Washington state in 2014. Photo by Jason Kriess/Wikimedia Commons
King County burn ban under way

Other counties across the state have already enacted similar restrictions.

Between Seattle’s $15 minimum wage and the new no-poach cause agreement, Washington has been leading the nation in advancing fast food workers’ rights. Photo by Fibonacci Blue/Flickr
Washington AG’s deal grants mobility to fast food workers nationwide

Seven fast food chains have agreed to end no-poaching policies that economists say cause wage stagnation.

Dianne Laurine, a Commissioner for the Seattle Commission for People with Disabilities says that she needs plastic straws to drink liquids, and that she easily bites through ones made out of paper. Photo by Melissa Hellmann
Straw ban leaves disabled community feeling high and dry

Although disabled people are exempted from Seattle’s new law, the impacted community says that businesses haven’t gotten the message.

Fire damages Kent West Hill home

Second fire in two days in neighborhood

Most Read