Condon vows not to raise taxes despite forecast

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

New figures announced Tuesday forecast a $10 million budget shortfall for the city in 2013. Despite that, Spokane Mayor David Condon pledged that his 2013 general fund budget proposal will not include higher taxes.

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

The city’s general fund revenue comes largely from sales, property and utility taxes and pays for services including fire, library, police and parks.

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 also 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 will likely 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 depleted 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.

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, Verner put the arts, youth, and weights and measures departments on the chopping block. 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 remains open.