Thursday, December 6, 2012

Redmond City Council approves budget - raises property and utility taxes

The City Council approved the Administration's 2013-2014 budget 5-2 with Hank Myers and David Carson voting 'no" to the ordinance.    Property taxes will go up $6/year and water/stormwater will increase 2%/4% per the biennium.   Under a separate ordinance the council raised nonunion salaries 1.5%/year. 

Councilmember Hank Myers called out the 1% tax increase as "entirely unnecessary since we have a $10 million ending balance and the 1% amounts to less than 5% of our ending balance."   He referenced three different contingency reserves, and said no services would have to be cut if the tax stays the same.  He said the price of Redmond government was higher compared to Issaquah, Kirkland, and Woodinville.  Like all councilmembers, he lauded the Administration on a job well done in preparing a transparent budget and thanked the Mayor and Council Finance Chair John Stilin for their leadership.

Councilmember David Carson said he could have said Yes to the entire package if more than 40% of the capital fund ending balance could have gone to capital improvements.  He was most concerned about the 1% property tax saying, "If we had applied a small portion of the $10 million surplus it could have kept the City of Redmond residents from paying the tax increase."  He supported the Utility Tax increase saying it was specific to infrastructure. 

Council Chair of Finance John Stilin considered Redmond the envy of the region with it's well run finances and city administration.  He emphasized "being responsible in asking for a little bit more."  He said, "it would be nice if there were other ways to tax and spread this out but the 1% tax is our one tool we have."   "I look forward to digging deeper in the performance review process and having better performance measures such that in the off years of he budget we actually do a performance review of our budget." 

Councilmembers Tom Flynn and Hank Margeson were worried about a revenue/expenditure gap looming 4-6 years out.  Margeson said, "the 1% tax increase won't track that down but by being smart about what we spend going forward we will bridge the gap."  Flynn was glad to see some cuts and right-sizing to the budget and thought the 1% a small part in keeping up with inflation. 

Councilmember Kim Allen voted for the 1% this year because the economy is improving.  "It's good to see the cranes downtown", she said "and the tax increase is only $6/year."   She and Hank Margeson were glad to see the 166th Avenue safety reconfiguration in the books for this biennium.  Council President Pat Vache' agreed with Ms. Allen on the importance of the steady revenue flows in the maintaining the city's AAA rating.  Vache' also mentioned the gap projected in future years.

Mayor John Marchione thanked Council and his staff and advised Myers "The price of government index" is not a valid comparison tool to other cities.  The mayor was proud to claim the price of Redmond government (government expenses/% of income) is the lowest it's been in 12 years.  It went from 6% to 4.9% today.  He concluded the AAA rating saves the city millions of dollars.

By Bob Yoder

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