The city of Kent’s building up cash reserves and paying down debt this year because of new taxes as well as increased taxes and permit fees.
In fact, city officials even discussed at a council workshop Oct. 15 about adding six or more police officers in 2014 because of the positive financial picture Mayor Suzette Cooke and her staff presented during the 2013-14 biennial budget update.
“You’re going to hear a lot of good news about our budget this year, finally,” said Tom Brubaker, city interim chief administrative officer, to the council.
“There has been good strides in our financial goals,” said Bob Nachlinger, city finance director.
The general fund cash reserve is expected to hit $5.6 million by the end of this year as the city hits it 10 percent target of general fund monies in cash reserves, Nachlinger said. He added the city will have another $1.5 million in a contingency fund for unanticipated costs and $458,000 for a new strategic opportunity fund. The city also has started to pay down internal and external debt.
Brubaker cautioned the council, however, about the positive budget numbers.
“I just want to warn you even with the good news, we still need to bring our reserves up, our debt down and we still have not settled our labor negotiations for the next year,” Brubaker said.
While city officials reached a contract agreement with the Kent Police Officers Association, the city remains in negotiations with Teamsters Local 117 that represents public works, parks and facilities employees, and Local 2617 of the American Federation of State, County and Municipal Employees (AFSCME) that represents administrative staff, corrections workers and building inspectors.
“I want to make sure we look at the outcome of two labor contracts,” Councilwoman Dana Ralph said. “If we look at adding more police officers, we need to look at support in the police office as well.”
Councilman Bill Boyce reacted to city staff’s proposal to add six more police officers.
“The police are not staffed where they should be,” Boyce said. “Six more is good but I’d like to see more than that.”
Councilman Les Thomas agreed with points raised by Ralph and Boyce.
“Like Dana I am concerned with all of the good news we’ll be in the frame of mind to start spending but it looks pretty good,” Thomas said. “I agree with Bill we need more officers.”
The council adopted its first two-year budget in December 2012, rather than voting each year on a budget. That 4-3 vote last year included a new business and occupation (B&O) tax to raise about $5 million per year; a 6 percent cable television utility tax to bring in about $1.3 million per year and higher permit fees for developers for about $1 million per year.
Council members also approved a 5 percent jump in storm drainage tax rates, 4 percent increase in sewer rates and a 3 percent jump in water rates. The storm, sewer and water rates are at 13 percent and scheduled to go up again in 2014, although the council plans to take another look at those increases.
“We have to look at water, sewer and storm rate increases to make sure we want to move forward with the increases,” Councilwoman Elizabeth Albertson said.
Any decrease in utility rate jumps for next year would cause staff to readjust the 2014 budget because of less revenue.
The council adopted the new taxes and tax increases last year in an effort to diversify the city tax bases, build back cash reserves and pay down debt. The city’s financial struggles over the last few years has led to downgrades in 2012 to the city’s bond rating by Moody’s Investors Services.
The council still hasn’t figured out what to do about the financially struggling Riverbend Golf Complex, which loses money each year and has a $2.25 million debt. The general fund also includes $500,000 each year to help cover operating losses at the city-owned ShoWare Center.
Council members plan further discussion about the budget at a Nov. 19 workshop.
“We still have a tremendous amount of unmet need for parks and streets,” Brubaker said. “It’s good news, we’re climbing out of our hole. But we have a long, long way to go. We still have to be very responsible with how we handle our money.”
The city budget is available online at http://kentwa.gov/Budget.aspx.
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