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Challenges remain for city's budget | Mayor Skip Priest
While many cities are struggling with difficult budgets, potential layoffs and service reductions, the City of Federal Way’s proposed 2013-2014 budget offers a balanced budget that preserves existing programs for our residents.
The “No Frills, No Cuts” budget doesn’t launch any ambitious new programs, but it will ensure that the services that matter to the community — from public safety to parks and recreation, from street maintenance to safe neighborhoods — will remain intact for residents.
The city council and I will be discussing the proposed budget over the next month, and taking public comments on the budget in a number of ways. I want to encourage residents to share their thoughts about the budget and ask questions prior to a final budget decision being made at the Dec. 4 city council meeting. You can download the budget and related documents on our budget webpage at www.cityoffederalway.com/budget.
Reaching a balanced budget is the result of nearly two years of hard work by the staff and the Federal Way City Council. The previous two-year budget required layoffs and deep cuts to close an $8.9 million operating gap. After I took office as the city’s first elected mayor in November 2010, the council and I began to work on the 2013/2014 budget, agreeing that the city needed to alter its course toward a path to fiscal sustainability.
The first step on that path was a major management and senior staff reorganization that saved the city nearly $1 million. We saved another $1.5 million by instituting a philosophy of “frugal innovation” — finding ways to deliver the same or better services at lower costs. In addition to the current savings, both measures provide ongoing savings to the city, making it easier to balance next biennium’s budget as well as subsequent budgets.
Balancing the budget also required redirecting $600,000 of street overlay funding to the General Fund each year and reducing or eliminating almost $200,000 a year of various line items. A federal grant awarded to the city for 2013 will refill the overlay fund, keeping our street maintenance program whole, and our streets in top condition.
Public safety remains the city’s top priority with two-thirds of the city’s budget directed to police, the court system and jail services. Parks, Public Works and Community and Economic Development also maintain even funding during the next two years, ensuring that residents will not see changes in service in these areas, either.
The proposed 2013/2014 budget is, at its core, a cautious budget. We preserve a healthy “end of fund” balance each year, as recommended by the Government Finance Officers Association to be prepared for unanticipated emergencies. Likewise, the proposed budget maintains healthy reserve funds for specific areas such as emergency management, which was critical in responding to January’s ice and snow storm.
Caution is also warranted as there is a long list of potential fiscal landmines that the city may encounter over the next two years. In March, the state Legislature cut liquor excise tax revenues shared with cities, a move that reduced Federal Way’s revenues by $480,000 a year. The likelihood of the city budget being hit by additional state cuts, as well as federal budget cuts, remains high. Employer healthcare costs continue to rise, and we are seeing increased costs to the city from the regional SCORE jail facility Federal Way is a partner in.
Looking beyond this balanced budget, there are long-range challenges lurking in the next biennium. The projections for 2015/2016 show the ending fund balance being depleted and the return of an operating budget gap. Once the 2013/2014 budget is passed, we will need to begin working on the 2015/2016 budget, and we cannot lose sight of the long-term financial challenges and the need to continue to contain costs.
The city is not much different from households all over Federal Way who are also making tough decisions to respond to the challenging economic times. We have to live within our means, and this budget does that, controlling spending, while maintaining vital city services necessary to support a growing community and business sector as the economy recovers.