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Spin Control

Condon says he won’t raise taxes to close $10 million hole

Another year, another multimillion dollar deficit at Spokane City Hall.

Spokane Mayor David Condon pledged that his 2013 general fund budget proposal will not include higher taxes despite a forecasted deficit of up to $10 million.

“Our citizens expects us to live within our means Their incomes have not increased and ours is not going to either,” Condon said at a news conference on Tuesday, his 101st day in office.

The city’s general fund is made up of the services mostly paid for with sales, property and utility taxes. They include the fire, library, police and parks departments.

The deficit could improve soon. That’s because about $2 million of the deficit is based on a prediction that the state will slash revenue-sharing tax money with cities. The state’s budget, however, isn’t finalized.


 

But there are unavoidable challenges even if the state comes through. The city’s largest tax revenue comes from utility taxes. With the price of natural gas falling, the city will collect less. If the City Council approves Condon’s water rate proposal as is expected on Monday, less revenue will be collected not only in rates that support the water department, but in utility taxes that support the general fund. Condon said his economic forecasting council, which was used also by his predecessor, Mayor Mary Verner, believes the economy will be largely flat in the next year. That means largely stagnant sales tax revenue.

The city also likely will have to forgo using reserves. Budgets proposed by Verner and approved by the City Council have relied the last few years on reserve funds. Those kinds of pots are largely gone and aren’t expected to help in 2013.

Condon said he is asking his top administrators to make their proposals for a budget by May 8. He will present his draft budget to the City Council about two months after that.

He said the budget will be $164 million, about $500,000 less than was set for this year. The $10 million deficit results from the cost to maintain current employee levels and city services rising by about that amount.

Condon said he hasn’t ruled out any particular cuts but that his goal is a budget that “minimizes the impacts on the citizens.”

Last year, Mayor Mary Verner put the arts, youth and weights and measures departments on the chopping blocks. The Spokane Park Board warned that it might cut senior and youth center funding. In the end, only the youth department got the boot, though many of its functions were taken over by the nonprofit Chase Youth Commission, which already was tied to the department.

The year before, the East Side Library was considered for closure. It remained open.


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About this blog

Jim Camden is a veteran political reporter for The Spokesman-Review.


Jonathan Brunt is an enterprise reporter for The Spokesman-Review.


Kip Hill is a general assignments reporter for The Spokesman-Review.

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