Budget Summit Will Include All Kitsap Mayors

Despite being a day after Mayor Cary Bozeman presents his 2009 budget to the Bremerton City Council, Bozeman and more than a dozen mayors of small- and medium-sized cities will meet in Seattle Thursday for a budget summit.

The economic turndown, prodded by the global financial slowdown/freeze/crack up that started with too many high-risk home loans, has hit cities where it hurts. Cities, and the state, don’t have income taxes, and largely depend on people buying and selling houses and flat screen TVs to pay for programs.

With less money flowing – except for stocks in tear gas, bottled water and firearms – cities will have less money to pay for street paving and beat cops, although Bozeman has said his budget proposal will not cut public safety services.

The summit will give mayors a chance to talk about different remedies to less robust revenues, Bozeman said.

As mentioned before, it comes after the administration presents its budget. So, it appears anything that is learned will not likely be much help in planning for 2009.

City councilmembers may be invited to attend – they weren’t as of last week – but reporters are only going to be allowed to observe discussions for two hours of the 5.5 hour meeting.

The city council will mull over the budget, expected to contain a heap of cuts to close an expected $4.4 million hole.

Here is the list of mayors, and others, expected to attend. Note that Port Orchard, Poulsbo and Bainbridge Island mayors have confirmed they will attend.
1.    Jane Christensen, Asst. to the Mayor        Redmond
2.    Jim Lauinger, Mayor                                  Kirkland
3.    Dennis Kendall, Mayor                              Marysville
4.    Linda Bird, Mayor                                      University Place
5.    Eric Faison, Govt. Affairs Manager            University Place
6.    Bud Norris, Mayor                                     Mount Vernon
7.    Alicia Huschka, Finance Director              Mount Vernon
8.    Ralph Shape, Mayor                                   Sea Tac
9.    Ava Frisinger, Mayor                                 Issaquah
10.    Jim Slowik, Mayor                                   Oak Harbor
11.    Doug Merriman, Finance Director           Oak Harbor
12.    Jim Pearman, Mayor                                Mercer Island
13.    Laure Iddings, Mayor                              Maple Valley
14.    Kathryn Quade, Mayor                            Poulsbo
15.    Lary Coppola, Mayor                              Port Orchard
16.    Karen Rogers, City Council, AWC Pres.   Port Angeles
17.    Jim Justin, AWC                                      AWC (Association of Washington Cities)
18.    Megan Owen, Governor’s Office            Governor’s Office
19.    Mary McClure, KRCC                              Kitsap Regional Coordinating Council
20.    Cary Bozeman, Mayor                            Bremerton
21.    Laura Lyon, Finance Director                 Bremerton
22.    PS Reilly                                                 Athena
23.    Athena Staff Person                               Athena
24.    Darlene Kordonowy, Mayor                    Bainbridge Island
25.    Choi Halladay, Asst. City Manager        City of Lakewood

Here is the agenda:

9:30 – 10:00  Check-in and networking

10:00 – 10:15 Welcome & Introductions

10:15 – 12:00 Identification and Discussion of Key Topics
• Growing Revenues In A Recessionary Economy
• Financial Risk Mitigation
• Balancing the Expenditure Budget
• Others as Identified

12:00 – 1:00 Working lunch discussion – Can Mayors Benefit from More Connection?

———————————–Press Arrives—————————————-

1:00 – 1:15  Morning Session Recap

1:15 – 2:45 Additional dialogue and calls to action

• Follow-on comments from morning topics
• Necessity Breeds Invention

2:45 – 3:00 Closing Comments

I like the warning line slashing through the agenda labeled “press arrives.” Might as well say, “flu arrives.”

And finally, here are the discussion suggestions:

Growing Revenues In A Recessionary Economy

Statewide initiatives have placed local governments in the position of needing perpetual economic growth to generate revenues to cover cost increases related to payroll and other ongoing expenditures related to the provision of core governmental operations.   What actions or ideas do you have to actually grow revenues in an economy that is receding?   Is constant economic growth (in an amount sufficient to cover inflation pressures) possible given Growth Management Act expectations and increasingly expensive energy resources?

Financial Risk Mitigation

City government’s core operational expenses (largely payroll and supporting supplies) are relatively stable and growing in nature – while revenues are often volatile due to changing economic conditions.   Volatility can happen year to year, month to month, and even within the month – in the short term having impacts on cash flow management  and in the long term having impact on the City’s ability to deliver core services (such as public safety).  What actions have you taken (or are considering) to reduce financial risk related to this volatility mismatch of City revenue sources to governmental operations expenditures?   What’s your assessment of how quickly you can substantially adjust course in your organization and do you have adequate financial reserves to give you time to make those changes?

Balancing the Expenditure Budget

Our citizens rightfully expect us to conduct City business in the most efficient manner possible.   There is a point however, when revenue and cost pressures far exceed any capacity for additional efficiency improvements to balance the budget – and outright reductions become necessary.   How do you balance the need to provide expected government services with the need to invest in growing your City’s future revenues (economic development)?   Does your organization have clear priorities of which services/programs are to be removed first or has the approach been one of more general across the board reductions?   If you have clear priorities – how did they get established?   By whom?    For those making service or program level reductions, how are you managing citizen expectations and communicating those changes?

Necessity Breeds Invention

Often, difficult times produce positive outcomes.   A financial crisis by its very nature creates change – some good – some painful.   It forces a review of operations and priorities that goes beyond the effort typically applied in more fortunate times.  What innovative approaches or solutions have emerged from your current budget balancing challenges?   Has your leadership team risen up to meet the challenge?

3 thoughts on “Budget Summit Will Include All Kitsap Mayors

  1. “Statewide initiatives have placed local governments in the position of needing perpetual economic growth to generate revenues to cover cost increases related to payroll….”

    I wonder if they have the courage or desire to address what state law does to increase the amounts needed to meet their payrolls.

    I hear of “unfunded mandates” quite a bit.

    Any state laws that drive up the amounts needed for pay, health benefits, and pensions would be “unfunded mandates,” if they both ignore the ability of the municipal corporations to pay the increases and provide no revenue to pay them.

    Yet, I don’t recall hearing anyone in government refer to the need to change any such “unfunded mandates” when talking about their budgets.

  2. Binion here:

    Good point, Bob. You do hear a lot about those pesky “Unfunded mandates.” Maybe we haven’t heard much about them lately because the budget woes are relatively new and city’s, at least Bremerton, haven’t gutted their reserves. Yet. Maybe not. I do know congressional Democrats have been talking about a stimulus package that sends money to states to help with deficits.

    By the way, isn’t that the right of higher levels of government, to require lower governments to provide certain services and tax their own people for it? And aren’t “funded mandates” less efficient than their unfunded siblings, in that those tax dollars have to be cycled through state government before they are spread to local governments?

  3. Andrew, the higher level of government can indeed tell the lower levels what they have to do; but the revenue to do it has to exist or it cannot be done.

    I haven’t yet seen anything that appears to me to be a really significant “unfunded mandate” listed by the complainers, which is why I pointed to the laws which lead to increases in the payroll — that is, by setting the rules for determining employee compensation including benefits. Those rules may be a place to go looking for significant unfunded mandates.

    If the rules for determining employee compensation outstrip both the current taxing authority and the growth in the economy (and thus the personal income of taxpayers which would be available to pay the needed taxes), something has to give. Maybe it ought to be the rules.

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