City Council reviews proposed levy lid lift

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A chart showing the expenditures, revenues and fund balance for the city. The right two bars show the difference between what was budgeted and what actually happened with the city’s finances in 2015. An extra $900,000 in revenues was budgeted.

City Council took another look at the budget and proposed levy lid lift during Thursday night’s study session.

The city is spending more than it is making and the general fund balance is declining. Meanwhile, the city has to pay rent for the interim city hall space at Redstone. If a new source of revenue is not found, city staff members say the general fund will continue to decline and reserves will be left unfilled. If the general fund balance remains low, the city will not have funds to take care of unanticipated needs and the city’s bond rating could be lowered, which could affect funding for future projects.

Interim City Manager Scott Hugill recommended council put a $0.67 levy on the primary ballot in August, so the city will know if it will have the funds before constructing and approving a budget for the next two years. A $0.67 levy would cost the average Mountlake Terrace homeowner, who owns a house worth $256,600, $172 per year.

The proposed levy would remain at $0.67 for four years, then drop to $0.25 in the fifth year. The $0.42 that would only be in effect for four years would specifically go toward paying rent on the interim city hall, and the continuing $0.25 would go toward parks, which would allow the city to free up general fund dollars and expand service in public safety, infrastructure maintenance and economic development.

During the first four years of the levy lid lift, the city would develop a plan for a new city hall and would build up the general fund balance.

In order for the city to put the measure on the August ballot, however, council would need to approve the action in early May at the latest. If the council decides to put the levy lid lift on the November ballot, that decision could be pushed to early August.

Some council members want to hear more before making a decision.

“We have an expenditure issue,” Councilmember Laura Sonmore said. “Our expenditures are greater than what is coming in, so with that, to support something like this, I need to see all of the options there are within our existing budget to balance our budget.”

That balance is something the city would need if the levy lid lift does not pass.

“All of the future growth we are about to see, I want us to see that as a bonus and not count on that,” Councimember  Kyoko Matsumoto-Wright said.

Sonmore also asked for an ordinance to be written outlining exactly what the funds would be used for should the council move forward with the levy lid lift.

The City Council is scheduled to vote on the budget amendment and levy lid lift proposal on May 2. Councilmember Bryan Wahl asked to review the budget amendment on April 28 and to see what the budget would be if the levy lid lift does not pass. He said that would give the council an idea of the kinds of cuts that would be necessary to balance the budget within the existing budget.

Also during Thursday night’s study session, a presentation was given updating the council on Ballinger Park funding as a committee prepares to apply for grant funding. View that full presentation here. Those involved with the grant process are asking neighbors to write letters of support.

–By Natalie Covate

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