The Kent City Council voted 5-2 Tuesday night to adopt what Council President Debbie Raplee called “a pretty conservative” 2010 city budget.
But Council members and city staff emphasized that if revenues come in lower than projected for the final two months of 2009, city officials might need to make further cuts in the spring of 2010.
Council members approved a $157.4 million operating budget, including a general fund budget of $80.3 million and $11.4 million for capital projects. The rest of the budget is dedicated to other funds such as water, sewer and drainage utilities. The budget is 5.6 percent less than the 2009 budget.
Council members Raplee, Tim Clark, Deborah Ranninger, Elizabeth Albertson and Jamie Danielson voted to approve the budget ordinance. Council members Ron Harmon and Les Thomas voted against the budget.
The Council also directed city staff to keep a reserve balance of $6.4 million, or 8.1 percent, of the general fund budget.
“The 8.1 percent reserve we have requested is not money that sits in the bank and never gets spent,” Raplee said prior to the vote. “We have used that repeatedly and drawn it down to zero if not a minus. That is a number we are comfortable with for 2010, knowing full well that if the numbers do not come in at the end of February, there would be more cuts to get us to 8 percent.
“But this is a pretty conservative budget and I am comfortable with it going forward,” she added.
Harmon and Thomas are concerned the budget shortfall could be larger than city staff expects because of declining sales-tax revenue as well as expenses that could be higher than projected.
“I’ve been told that there’s going to be monies coming in for November and December,” Harmon said. “But if we overestimated our budget for 2009, my concern is that we will not be able to make projections for 2010. With those shortfalls and that unknown, I can’t support this budget.”
Kent Mayor Suzette Cooke presented her preliminary budget in October to the Council that included the layoffs of 24 employees by the end of November in an effort to help address a projected $4.6 million revenue shortfall next year in the general fund. City officials will leave another 32 positions vacant next year. That has dropped the number of city employees by 6.7 percent to 782 for 2010.
The city did not cut any police officers or firefighters as part of an emphasis to keep public safety agencies fully staffed.
“We have shown that our priorities are correct in this budget and that is public safety,” Danielson said. “We are keeping officers on the road and firefighters on the trucks.”
City employees will not receive a cost-of-living adjustment (COLA) in 2010 because of a negative Consumer Price Index in 2009, as outlined in Cooke’s initial budget. Pay raises for union and nonunion employees are tied to the inflation rate. A 1 percent COLA increase would cost the city about $500,000 a year, said Michelle Witham, city spokeswoman. The pay increases have averaged about 3 percent in each of the last few years.
Cooke said the budget is projected to end 2009 and 2010 at the 8.1 percent reserve fund target requested by the Council.
“If revenues do not meet projections, we will make further adjustments in 2010 to reach 8.1,” Cooke said.
Thomas said he knows “adjustments” means further job cuts, maybe as many as 10 employees. He said he has doubts the city can make up its revenue shortfall for 2009 over the last two months as projected by City Finance Director Bob Nachlinger.
“Bob you have done a fantastic job and I have been hanging with you since day one,” Thomas said at the meeting. “But the accountant in me makes me have a little bit of a problem that things are going to be all rosy. I do love that the last couple of months have been upturns, but there is a big gap that I don’t know if we can make up.”
Nachlinger said he expects the fund balance of $5.6 million or 7.2 percent through the end of October to reach $6.4 million or 8.1 percent when the final 2009 budget numbers are received in February.
Thomas also voted against the budget earlier Tuesday when it passed out of the Council’s Operations Committee on a 2-1 vote. Raplee and Clark voted to forward the budget to the full Council.
Clark, in his final meeting after a 16-year career on the Council, voted against the budget in 2009 because he believed city staff overestimated how much sales tax revenue the city would receive. But Clark voted for the 2010 budget.
“I have to acknowledge that administration has done a fine job in trying to manage the expenditures side to keep the bottom line going forward,” Clark said. “But the fact is we have 55 fewer employees this year at the end than when we started the year. It has been a long and difficult process.
“This budget is fairly conservative,” Clark said. “There are concerns by all Council members to try to get to a common vision and trying to move forward as well as we can. I did not approve last year’s budget, but I think it probably says something that I am going to approve this year’s budget.”
The Council approved Cooke’s budget proposal to set aside $1 million in 2010 for flood relief in case the Green River floods the city this winter.
“I am glad to see we are making sure we have the tools in case a flood does come,” Danielson said. “That $1 million will go quickly if a flood does come.”
City service cuts included a reduced number of overnight trips through the Kent Senior Center, elimination of the Teen Outdoor Adventure Club and a reduction in city concerts and events. The actual number of concerts and events to be cut has yet to be determined by the city parks department.
City officials said residents also should expect slower response times to requests to city departments, except for police and fire.
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