Snohomish County Budget

What Comes Next for the County Budget?

The County Executive recently released his proposed budget for the next two years, and the County Council will spend the next several weeks going through it before we adopt a final budget later this fall.

There is a lot in it. But before we get too far into that process, I want to explain where our finances stand, what has changed over the last few months and what we'll be looking at as we work toward a final budget.

How We Got Here

This summer, we were looking at an estimated $28 million annual General Fund deficit.

Some reasons are outside our control. Inflation has raised staffing, healthcare, construction and other service costs. The Trump administration's tariffs have increased the cost of goods, the war with Iran has driven up fuel and energy costs, and federal changes have limited access to grant dollars. All of that eventually reaches our budget.

Our own decisions have contributed too. During better financial years, we used one-time money to support ongoing programs and added expenses that are now part of our base budget.

But we can't keep chasing bad decisions with more bad decisions. 

We cannot ask residents to pay more without showing that the County has corrected the budgeting decisions that created this problem.

We cannot control those outside forces from Snohomish County. We can control what we spend, the services we provide and the priorities we fund.

One Big Decision Has Already Been Made

On August 12, the County Council approved a new 0.1% Public Safety Enhancement Sales Tax. The proposed budget estimates it will raise about $25.5 million next year. As many of you know, I voted no.

I've explained my reasons since the vote, so I won't repeat them here. But this context is relevant: in every year I have served on the County Council, I supported additional revenue when I believed it was necessary and responsible. This was the first time I voted no.

Taxes are not inherently bad; good public services cost money. My concern was that we committed one of local government's largest remaining revenue tools before seeing the full budget and making spending decisions first. I am even more concerned now that I see the budget proposal.

That decision has been made. The revenue is now part of our budget, and our responsibility is to make sure we use it well.

Where We Are Now

We started the summer with an estimated $28 million annual deficit. The sales tax approved in August is expected to generate about $25.5 million next year, leaving roughly $2.5 million of that original deficit.

The proposed budget then adds another $4.5 million in property-tax revenue and identifies approximately $17 million in departmental savings and reductions.

Put those together and we're talking about roughly $47 million in new revenue and spending reductions in response to an original $28 million deficit.

Granted, the math is not as simple as $28 million minus $47 million. Projections change, salaries can adjust mid-biennium and ongoing and one-time expenses are treated differently.

But the obvious question needs to be asked: why does it take $47 million in new revenue and reductions to address a $28 million deficit?

We also need to understand what actually makes up the $17 million in reported savings and reductions.

Nearly every General Fund department was given a 3% reduction target. Department heads had flexibility in how they got there, and a few departments received exceptions or smaller reductions.

Some departments reduced positions or program spending. Others counted savings from jobs that are already vacant or made revenue adjustments, such as increasing fees. Those can all help balance this budget, but they don't all reduce our ongoing costs.

Based on our initial review, only about $6.5 million appears to come from structural spending reductions. We'll know more as we go through the budget department by department.

What Are Residents Actually Paying?

It's been said that the proposal would increase the property-tax bill on the average home by about $41 per year. That's an important number, but it doesn't capture the full increase residents are being asked to absorb.

Along with the new sales tax, the Council also approved a $20 annual car-tab fee increase on August 12. I opposed that measure as well.

The sales tax, car-tab fee and proposed property-tax increase are all additional costs residents will begin paying next year. For a typical homeowner in unincorporated Snohomish County with two cars and ordinary taxable spending, the combined increase can easily top $100 per year.

What We'll Be Looking At

As we review the proposal, we'll examine where reductions make sense. Some services may need more funding, some departments may be able to absorb larger reductions, and some expenses may no longer make sense.

We should also expect a clear accounting of what residents are getting for the new revenue. The Public Safety Enhancement Sales Tax will bring in more than $25 million next year for the Law and Justice system, which already accounts for roughly 76% of our General Fund.

Like many local governments, we face law-enforcement recruitment and retention challenges. With this much new public-safety revenue, we should be able to explain what it will accomplish and whether it strengthens the system.

But my biggest concern with the current proposal is what happens after this budget.

The proposal will be described as balanced, and technically it is. But in government budgeting, "balanced" does not necessarily mean annual revenues equal annual expenses. The County can use money already in its fund balance to make the numbers balance.

Think about your household budget. If you start with $2,000 in savings, spend more than you earn and finish the year with $1,000, the math works because savings covered the difference. But you would not call that sustainable if the plan continued drawing down savings every year.

The County's own six-year forecast shows our reserves declining every year. Total General Fund reserves start at about 16.6% in 2027, fall below our 14% target in 2028, and are projected to reach just 4.5% by 2032.

Even after adding the sales tax, taking the available property-tax increase and identifying $17 million in departmental savings and reductions, the County's own forecast shows reserves continuing to decline.

A budget can technically balance for the next two years and still leave the same structural problem waiting immediately behind it. That's not a sustainable solution.

What Comes Next

Over the next several weeks, we'll meet with departments, test the assumptions behind the proposal and consider changes.

I'll write again once the competing approaches and actual choices on the table are clearer.

I'll be looking for a budget that protects essential services, respects the people being asked to pay for them and puts the County on a sustainable path beyond the next two years.

That's the work ahead, and as always, I want to keep hearing what you think.