Lacey council discusses budget shortfall

August 6th, 2015 by Ken

Faced with an impending budget shortfall, the Lacey City Council used its annual council retreat to talk about money and budgets.

The City of Lacey currently has a reserve fund of $24 million dollars.  Some of that reserve is required by law, other by council action and some by common sense.

City staff identified $4.5 million dollars of reserve money that can be used for other purposes.  It included $2 million for city hall expansion and another $750,000 for police station expansion.   Lacey City Manager Scott Spence pointed out that money had been set aside in 2007-2008 when the city was growing rapidly and looked like city hall would run  out of space.

Other reserve funds were tapped to make the $4.5 million.

Spence received council approval to spend $2 million of that money to help with the budget.   “It’s just an umbrella for us to use when needed,” Spence said.  “It’s not the answer to our long term problem.”

The council directed staff to use the remaining $2.5 million for economic development.  That money will help projects in the city which bring in revenue.

The council also discussed new revenue sources such as a 3 percent tax on cable television and phone.    It also took a look at creating a Transportation Benefit District (TBD) which is authorized by state law.

Under a TBD, a city can increase car tabs by $20 (which Olympia has already done) or put a 2/10th of a percent on local sales tax on the ballot for taxpayer approval  (which Tumwater recently did) for the purpose of providing transportation improvements.

The council discussed all new tax proposals but took no action.

Posted in Government, Informational, Local Politics, The Real News

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