PORT TOWNSEND — Retail sales and the increase in garbage rates bolstered preliminary financial figures presented to the Port Townsend City Council, which is entering its budget phase this month.
Council members conducted a workshop Monday night at City Hall to learn key revenue highlights, new requests from department heads and to get their first look at a long-range model that shows budget impacts over 20 years.
Forecast numbers from retail sales showed a 5.3 percent increase over the 2019 adopted budget with a projection of nearly $2.58 million, city Finance Manager Sheila Danielson said.
“I know we like to conservatively forecast, but we’ll know more when we get our September receipts in because they reflect some of the busier months of the year,” she said.
The public utility tax was projected with a 5.2 percent increase, mostly based on a new contract for garbage service that will go into effect next April, Danielson said.
The council passed a 10-year contract with Murray’s Disposal Company this past spring, and it also doubled the city’s stormwater surcharge to $6 per month, a change that became effective July 1.
Mayor Deborah Stinson said Monday residents will pay more in their fee but less in their utility tax, although Council member Pam Adams said it’s not a one-for-one trade.
“It did prevent us from getting a windfall on the tax,” Stinson said.
The water and sewer revenues also will include a $3 increase in a monthly stormwater surcharge, which will fund capital needs and major repairs, Danielson said.
Other funds that receive public utility tax dollars are the general fund, the police department, the street fund and community services for parks and facilities, according to city documents.
While the city plans to allocate about 11 percent more in property tax revenue to its general fund, it will remove both the fire levy lid lift and the associated emergency services levy, a total of about $2.4 million it had adopted in 2019 to pay for the contract for services with East Jefferson Fire-Rescue (EJFR).
The funds for fire service are no longer needed because voters approved the city to be annexed into the fire district in February. Residents will pay property tax directly to the fire district instead of having it collected by the city and transferred to EJFR.
As a result, the city will hold off on collecting its property tax levy until 2021 and phase it back in one-third at a time annually through 2023. Then those funds will be earmarked for specific uses, possibly including street repair and utility tax relief.
As new department requests were submitted, several new positions were discussed, including an administrative assistant at the front desk, a public records assistant, a police officer, and maintenance workers both in the parks and water departments.
Additional requests include high-definition cameras in council chambers for reproduction value both online and on TV, and various hardware and software upgrades for records management.
The one-time requests totaled about $875,000, and ongoing costs were about $680,000.
“This is a new approach for us,” interim City Manager Nora Mitchell said. “We’re looking at evaluating these in context with each other.
“Some will make it in, and some — well, most — will not.”
Stinson said she appreciated the exercise.
“It’s good to document it so we know what we’re up against,” she said.
In another fresh approach, city accountant Tony Hillman provided 20-year forecasting modeling for three specific funds through a program called MuniCast.
The charts kept the city’s overall growth by 1 percent year over year and showed expanding deficits based on inflation and other factors in the general fund, community services fund and the street operations fund.
“Expenditures are outpacing our revenues by 14 percent annually,” Hillman said.
Mitchell said the modeling software uses 2019 as its baseline year and will be most helpful when the city runs comparison models with different budget priorities.
“I think it’ll be very helpful,” Stinson said. “All these things really help us with prioritization.”
Jefferson County Managing Editor Brian McLean can be reached at 360-385-2335, ext. 6, or at [email protected].