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Sammamish budget reflects the new economy

December 15, 2009

By J.B. Wogan

By J.B. Wogan
When the City Council passed the city budget Dec. 2, it approved a handful of adjustments that reflect a severely contracted real estate market and some delayed construction projects.
Overall, the council passed a budget that anticipates $72.6 million in spending and $50 million in revenues. The $22.6 million difference is largely money that has been collected and set aside for large projects that will be spent this year.
The majority of spending will come from the general fund, followed by transportation and parks construction projects, which amount to about $17.2 million and $11.4 million, respectively.
The 2010 budget flat lines the salaries of city employees and keeps property taxes at their current level.
A comparison between the 2009-2010 biennial budget passed by the council in December 2008 and the one passed a year later shows greater pessimism about the real estate market and consumerism in 2010.
The original 2010 budget anticipated about $1.8 million in revenues from development impact fees (fees paid by builders for new construction), but after adjustments, the city anticipates only $452,600, a 75 percent drop.
Revenues to be collected through building plan check fees and building permits in 2010 are projected to be less than originally anticipated. Building permits are expected to generate $450,000 instead of $500,000 and building plan check fees are expected to generate $300,000 instead of $350,000.
The budget also makes a conservative guess that local consumerism will be lower than originally anticipated. The original budget pegged sales and use tax revenues at $2.7 million, but the new budget expects $2.5 million, about a 7.4 percent decrease. If the estimate turns out to be correct, then revenues coming from the sales and use tax would be 16.2 percent lower than in 2008.
Delayed construction
projects
Upon first glance, it appears that the city is spending about $25 million more than expected in 2010, but most of that is carryover from 2009 capital projects on East Lake Sammamish Parkway and 244th Avenue.
The city budgeted spending $84.2 million in 2009, but recorded $65.4 million in spending because of those carryover projects.
Construction delays affected the budget in another way. One expected source of revenue in 2010, worth about $500,000, was the sale of the Lamb House, located on the 2000 block of 228th Avenue Southeast. The Lamb House is one of two small facilities currently occupied by the operations and maintenance staff.
Because construction on the new operations and maintenance facility on 244th Avenue (at the north end of the city) isn’t going to begin until the spring of 2010, the budget doesn’t show an expected sale for next year.
After the new building is finished, the house would go up for sale, according to Deputy Finance Director Aaron Antin.
Unexpected income
But there are glimmers of hope in other areas of the budget.
Antin said the state Legislature voted this year to increase the distribution of the state’s Liquor Control Board profits. That means that Sammamish is due to receive about $330,000 from liquor profits in 2010, up from $270,000 in 2009.
The Parks Department should also make more money than the original budget showed.
Parks Director Jessi Richardson pointed out that the city has been underestimating how much the city makes in athletic field-use fees. An adjusted projection shows the city reaping in $250,000 (instead of $150,000) from field-use fees in 2010.
Richardson said the same practice of conservative estimates meant that the city has been making more than expected from renting out the Beaver Lake Lodge each year. That should generate $50,000 (instead of $40,000).
In addition, the cost of King County District Court services is supposed to be $80,000 less than the city originally budgeted, from $105,000 to $25,000. Antin said the drop in cost came from a revised projection from the county.
Reporter J.B. Wogan can be reached at 392-6434, ext. 247, or jbwogan@isspress.com. To comment on this story, visit www.SammamishReview.com.

When the City Council passed the city budget Dec. 2, it approved a handful of adjustments that reflect a severely contracted real estate market and some delayed construction projects.

Overall, the council passed a budget that anticipates $72.6 million in spending and $50 million in revenues. The $22.6 million difference is largely money that has been collected and set aside for large projects that will be spent this year.

The majority of spending will come from the general fund, followed by transportation and parks construction projects, which amount to about $17.2 million and $11.4 million, respectively.

The 2010 budget flat lines the salaries of city employees and keeps property taxes at their current level.

A comparison between the 2009-2010 biennial budget passed by the council in December 2008 and the one passed a year later shows greater pessimism about the real estate market and consumerism in 2010.

The original 2010 budget anticipated about $1.8 million in revenues from development impact fees (fees paid by builders for new construction), but after adjustments, the city anticipates only $452,600, a 75 percent drop.

Revenues to be collected through building plan check fees and building permits in 2010 are projected to be less than originally anticipated. Building permits are expected to generate $450,000 instead of $500,000 and building plan check fees are expected to generate $300,000 instead of $350,000.

The budget also makes a conservative guess that local consumerism will be lower than originally anticipated. The original budget pegged sales and use tax revenues at $2.7 million, but the new budget expects $2.5 million, about a 7.4 percent decrease. If the estimate turns out to be correct, then revenues coming from the sales and use tax would be 16.2 percent lower than in 2008.

Delayed construction

projects

Upon first glance, it appears that the city is spending about $25 million more than expected in 2010, but most of that is carryover from 2009 capital projects on East Lake Sammamish Parkway and 244th Avenue.

The city budgeted spending $84.2 million in 2009, but recorded $65.4 million in spending because of those carryover projects.

Construction delays affected the budget in another way. One expected source of revenue in 2010, worth about $500,000, was the sale of the Lamb House, located on the 2000 block of 228th Avenue Southeast. The Lamb House is one of two small facilities currently occupied by the operations and maintenance staff.

Because construction on the new operations and maintenance facility on 244th Avenue (at the north end of the city) isn’t going to begin until the spring of 2010, the budget doesn’t show an expected sale for next year.

After the new building is finished, the house would go up for sale, according to Deputy Finance Director Aaron Antin.

Unexpected income

But there are glimmers of hope in other areas of the budget.

Antin said the state Legislature voted this year to increase the distribution of the state’s Liquor Control Board profits. That means that Sammamish is due to receive about $330,000 from liquor profits in 2010, up from $270,000 in 2009.

The Parks Department should also make more money than the original budget showed.

Parks Director Jessi Richardson pointed out that the city has been underestimating how much the city makes in athletic field-use fees. An adjusted projection shows the city reaping in $250,000 (instead of $150,000) from field-use fees in 2010.

Richardson said the same practice of conservative estimates meant that the city has been making more than expected from renting out the Beaver Lake Lodge each year. That should generate $50,000 (instead of $40,000).

In addition, the cost of King County District Court services is supposed to be $80,000 less than the city originally budgeted, from $105,000 to $25,000. Antin said the drop in cost came from a revised projection from the county.

Reporter J.B. Wogan can be reached at 392-6434, ext. 247, or jbwogan@isspress.com.

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Written by J.B. Wogan · Filed Under Local News 

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