5-Finance-Ade Ariwoola
Financial Outlook
Council Retreat 2020
Presented by
Ade Ariwoola, Finance Director
February 1, 2020
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Take Away
Is the sky really falling?
Are we able to adequately deliver expected service at the expected quality level?
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Items to Cover
2019 Activities
Sound Transit
Supreme Court judgment
SCORE
City Reserve Policy
Salary Study & Position Analysis
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2019 Activities
Revenues are holding as projected
Expenditures are generally holding as expected
Fund balance remains stable
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2019 Activities-continued
Revenue Leakage:
Business Registration
State System
State anniversary date
Admission tax
Utility tax
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Sound Transit
Parking
Moving people from home to station
Downtown business hub and business recruitment
Downtown workers’ hub
Non-taxable properties
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Non-taxable Properties
(Based on King County record)
Type of Properties
Government Properties – i.e. Post Office, King County, City, School, Fire Department
Religious Properties – i.e. Churches
Affordable Housing – i.e. Apartment Complexes
Not for Profit – Medical Services
Tax Roll
25,729 properties on tax roll @ $13.13 Billion
749 Exempt @ $1.41 Billion
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Sound Transit-continued
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Non-taxable Properties
(Based on King County record)
When more properties are exempted it would increase the tax burden on the remaining non-exempt properties
749/25,729 = 2.9% Percent are non-taxable Properties
$1.41/$13.13 = 10.7% Percent are non-taxable value
Non-taxable properties are not reappraised
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Sound Transit-continued
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Sound Transit-continued
Fiber Optic as a separate utility
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Create a Business Hub in downtown
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Supreme Court Judgment on
Water and Sewer Utility Tax
Ordinance 18-847 passed March 20, 2018 & effective March 28, 2018
2018 9 months
2019 12 months
2020 possibly 6 months
Utility tax is based on GROSS RECEIPTS unlike Sales tax
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SCORE
$2.1 million in savings
Potential for additional savings from jail management
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City Reserve Policy
General Fund
Utility Tax
REET
Provides reasonable safety-net for a short time
In case of emergency
In case of revenue shortfall
Take advantage of economic opportunity
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Salary Study & Position Analysis
Paying staff more to keep good staff
Hiring more staff to be able to timely provide the quality service needed
Currently we underpay and are understaffed compared to other cities
This is not to suggest salary alone is what keeps employees
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Sustainability Revenue / Rising Labor Cost
Property Tax Rate
Labor Cost
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Conclusion
NO, the sky is not falling, the City is living within its means
The City needs to hire and maintain more qualified staff to meet the growing needs of the community and the service level required
The City has maintained structurally balanced budget for the past six years
The City’s needs and costs are growing faster than the available resources
Some investments are needed to prepare for the future
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Take Away
The sky is NOT falling!
Doing the MOST with what we’ve got!
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Take Away-continued
This is our chance!
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This is our chance!
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Questions
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