Missing Riverfront Project, Declining Retail Fuel Everett Budget Deficit

As the State of Washington talks about a budget surplus and the City of Seattle booms, elected officials in Everett are beginning to study which things to cut in order to control a persistent budget deficit.

At their retreat prior to their regular meeting this past Wednesday the Everett City Council heard from Everett City Finance Manager-Teasurer, Susy Haugen on what has changed since 2014 – 2015 that makes it much harder to balance the 2019 budget which currently shows a 13.2 million dollar deficit. You can see her full presentation to the council here.

Some of the major differences highlighted by Haugen included:

• In 2015 construction revenue peaked at $4 million dollars, its at $2.7 million dollars for 2018
• Everett had been planning on a new retail development on the riverfront that never materialized
• Continued retail growth in east and north Snohomish County diminished retail sales in Everett
• Carry-forward of surplus dollars based on employee vacancies has dropped sharply
• Far fewer opportunities now to increase revenues for general government spending

Haugen explained that the City of Everett current budget forecast assumes an average of 1.3% growth in revenue and a 3.8% growth in expenditures.

In her remarks, Everett City Council member Brenda Stonecipher spoke to the council focusing on the revenue side of the equation over the last several years while punting on the expenditure side of city spending. “I mean this is a mess,” said Stonecipher. “It really is.”

Chair of the Everett City Council budget committee Scott Murphy noted that about seventy percent of the city’s operating budget goes to staff costs such as salary and benefits. “That will have to be looked at,” Murphy said.

The city council budget committee is made up of members Murphy, Moore and Stonecipher. They will now meet on the first Wednesday of every month to work on the structural deficit issue.

On Friday Everett Mayor Cassie Franklin issued her fifth Mayoral Directive. This one has a focus on the budget deficit and contains eight initiatives to bring that deficit under control in the long term.

• An oversight team of executive staff and the council budget committee
• Evaluate all vacant positions for potential elimination
• Reduce travel and training costs
• Evaluate and prioritize current service provided by city departments
• Ask city employees and citizens for specific ideas on how to save money
• Explore alternatives to reduce employee benefit program costs
• Expand the use of volunteers throughout the city
• Investigate alternate funding and service delivery for Fire, Library, Park and Transit services in Everett

Everett Mayor Franklin has asked to have all of the reports on the initiatives completed by June 28th.

Budget chair Murphy may have summed it up best when he said, “We have a mountain to climb.”