In response to new revenue projections, Bothell officials sliced $1.2 million off the biennial municipal budget passed by City Council Dec. 2.
In a press release, City Manager Bob Stowe said he adjusted his initial spending plan after new statewide economic projections were released by the Washington State Economic and Revenue Forecast Council.
Stowe added he reduced the number of new staff members he initially hoped to hire, as well as cutting some general operating expenses.
“The city’s budget, even with these reductions, is a positive sign that City Council and staff are providing effective leadership and management of resources,” Stowe said. “By aligning our ongoing and one-time expenses with our ongoing and one-time revenues, we have positioned the city to ride out the tough economic times ahead.”
The total revised 2009-2010 budget is $204 million, including $75.7 million in general-fund expenditures.
The general fund pays for the day-to-day operating expenses of the city, everything from community development to public safety.
Even with the change in revenue projections, Stowe did not recommend taking — and City Council did not act to impose — the 1-percent property-tax hike municipalities are allowed to take annually without a vote of residents.
According to city Public Information Officer Joyce Goedeke, Stowe had proposed bringing on board the equivalent of 12 new full-time positions, of which seven would have had an impact on the general fund. Goedeke said the revamped budget changed the general-fund spots to include three positions on a limited-term basis for 2009 and another position on a limited-term basis in both of the next two years.
The new positions will include a fire-department office specialist. Positions scrapped for now include a police-records specialist and a parks maintenance worker.
Goedeke said examples of expenditure reductions not related to personnel include the elimination of two human-resource programs, including an employee incentive program.
Overall highlights of the two-year spending plan include large-scale capital improvements such as the realignment of the intersection of State Route 522 and Main Street, a major piece of the city’s ambitious downtown plan. A city planner has said the realignment will create a new “T”-shaped intersection meant to allow development opportunities on three different streets.
In the past, Stowe has said construction on the realignment should begin in 2010 and carry over into the following year.
More recently, he also talked about the new budget containing dollars for Centennial Park.
On a different front, Stowe specifically noted the revamped budget maintains a 20-percent operating reserve, which he described as a “safeguard for unanticipated revenue shortfalls.”
Even prior to the arrival of the new revenue forecasts, Stowe said he cut some $4.5 million in expenses. He also noted that roughly $5 million in what he called worthy departmental spending requests had to be left on the table.
Both city Finance Director Tami Schackman and Stowe said the city’s revenues are split almost evenly among property taxes, utility fees and local sales taxes, with a slight edge going to sales taxes, according to Schackman. Some dollars also come in from miscellaneous fees and fines.
Regarding the sales tax, Schackman said initial projections showed minimal increases in collections of 4.1 percent and 6.1 percent over the next two years, respectively. Schackman added sales-tax collections are something city officials will need to keep an eye on given the current volatility of the overall economy.
