With a lagging economy pretty much keeping a lid on the city’s chief sources of revenue, Lakewood leaders are turning to higher taxes and fees as well as some layoffs to balance the budget over the next two years.
The 2013-14 budget proposed by City Manager Andrew Neiditz calls for a new street-upkeep fee and an increase in electric and gas utility taxes. It also would raise fees to license a business, build a home and reserve a picnic shelter at a city park.
Pierce County’s second-largest city would slash three positions and reduce a fourth position to half-time from full time. There are no new hires proposed.
Neiditz said he hopes the proposed layoffs “will be the last round of reductions after some difficult years.”
The city has shrunk its workforce by a total 23.5 positions in the last several years. The proposed budget would pay for nearly 241 full-time-equivalent positions.
No cost-of-living adjustments for any employee are included in the new budget, but merit and longevity pay increases would continue.
The City Council, which is in the midst of a series of workshops to dig into the budget’s details, has the final say. The budget’s adoption is scheduled for Nov. 19 after a public hearing two weeks earlier. The budget takes effect Jan. 1.
Total spending in the general fund is virtually unchanged in the coming biennium compared to the current year: around $34.5 million annually. The general fund pays for most city services, including police protection.
Minimal increases are budgeted for property and sales tax revenues, the fund’s two biggest sources. The city projects to receive $9.2 million in sales tax in both 2013 and 2014 – a $200,000 increase from the current year and evidence that budget managers aren’t expecting a robust recovery soon.
“We’re just not seeing the kind of growth and rebound in the economy that we would like to see, which makes for difficult decisions and a difficult budget-setting for the next biennium,” Finance Director Choi Halladay said.
The city proposes to increase the tax it assesses on electric and gas utilities from 5 to 6 percent. This is expected to raise another $277,000 in revenue each of the next two years.
Lakewood already taxes garbage, cable and telephone providers at the 6 percent rate. It’s unknown at this time how much utility bills would jump for the average household if the tax increases are approved.
The budget also includes revenue from the transportation benefit district the City Council formed in August to provide funding for street maintenance. The council hasn’t settled whether it will assess a fee on the annual license renewal or a property tax levy.
Mayor Doug Richardson has vowed that the council would send any tax or fee to the ballot, although state law allow cities to assess a $20 fee without voter approval.
The budget calls for the district to raise an estimated $350,000, or six months of revenue, from the $20 fee in 2013, and another $700,000 for all of 2014.
Again, it will be up to the council to decide whether to assess a tax or fee and the amount.
A host of fee increases are being considered.
Neiditz’s current proposal calls for the annual cost of a business license to increase from $45 to $60. The cost of building permits would jump 7.5 percent.
Lakewood officials said fees haven’t been raised for several years, and the proposals are in line with what neighboring communities charge.
“We tried to raise the fees, but not go too high,” Community Development Director David Bugher said.
The proposals are before the planning advisory board as they draft recommendations to the City Council for consideration.
Another advisory board has already recommended a variety of park and recreation fee hikes:
• Special-use permits to reserve space at a city park for an event drawing 500 or more visitors would double from $500 to $1,000.
• Youth soccer teams not run by the city would pay $25 more to use fields for league matches.
• The fee to reserve a large picnic shelter at Fort Steilacoom Park for a half-day would increase from $85 to $100.
Grant funding from the federal stimulus that paid for three Lakewood police officers will expire next year, and the city would pick up that total cost of $305,000 annually for the next two years.
The proposed budget continues Lakewood’s investment in efforts to recruit new businesses to grow the city’s tax base. It also extends work with Joint Base Lewis-McChord and neighboring communities to address the impacts of the military’s rapid growth on streets, housing, schools and social services.
The city would fully fund its Community Safety Resource Team program, which teams police officers, code enforcers and legal advisers to combat nuisances in Lakewood neighborhoods, for another two years.
The city proposes to hand pink slips to its long-range planner and an assistant city attorney. The city would eliminate another vacant assistant city attorney position. The city’s human services coordinator would work half-time instead of full time.
In February, the city laid off four employees and eliminated four other vacant positions to help close a shortfall in the current budget of about $1 million
“It (the workforce reduction) certainly has taken its toll on workload and morale, but we believe we are moving forward and providing good, quality services with good, quality employees to the citizens of Lakewood,” Neiditz said when he unveiled his budget proposal on Oct. 1.
The city’s total budget, including capital, grant and law enforcement seizure funds, would grow from an estimated $50.6 million in the current year to nearly $67 million in each of the next two years. The bulk of the increase is due to $16 million in grant funding the city will receive for street improvement and stormwater projects.
Projects include improvements to Bridgeport Way between 75th to 83rd streets, South Tacoma Way from State Route 512 to 96th Street, and Steilacoom Boulevard from Custer Road to 88th Street.
Christian Hill: 253-274-7390
IF YOU GO
What: A public hearing on Lakewood’s proposed 2013-14 budget.
When: Nov. 5, starting shortly after 7 p.m.
Where: Council chambers of Lakewood City Hall, 6000 Main St. SW.
More information: The proposed budget can be reviewed online at cityoflakewood.us/government/departments/finance.