Mayor Nadine Woodward introduced a 2021 budget proposal Monday that avoids layoffs and maintains core city services, but will mostly leave it to the Spokane City Council to decide how deeply to dig into city reserves.
The $989 million budget includes investments in public safety and economic development, but largely reins in any major new spending as the city aims to recover from the coronavirus pandemic.
“Because of this health pandemic and loss of revenue we do have some limitations this year,” said Woodward, who described the budget as “priority-based.”
Woodward introduced the budget proposal in a joint press conference with members of the Spokane City Council on Monday. The two branches of government had already been in negotiations for weeks prior to the budget reveal.
“We’ve bridged a lot of the gap,” City Council President Breean Beggs said.
At $989 million, the proposed 2021 budget is an 11% decrease from the 2020 spending plan, with a bulk of the decline due to the completion of the city’s combined sewer overflow project this year.
The general fund, which covers most basic city services, would be $207 million, an increase of less than 1% from the previous year. The mayor’s budget would pull $1.7 million from the city’s reserves.
On Monday, Woodward and City Council President Breean Beggs said they were largely in agreement on spending.
“Most of our decision-making is going to be around how to pay for it, to the degree that revenues are down. We had a pretty steep dip in sales tax revenues,” Beggs said.
The council will have to decide how deeply to take from city reserves, if it should refinance loans and how to spend the proceeds from a 1% increase in property taxes, Beggs said.
“It has a little bit more to do with financing and revenues than actual expenses, at this time … nothing’s coming to mind where we’re in an argument over an expensive thing,” Beggs said.
The city has not had to make layoffs in 2020 because it was able to pull from its reserves, noted Councilwoman Candace Mumm, who is chair of the council’s Finance Committee.
“Because we came in with such strong reserves – we actually had excess reserves coming into 2020 – we’ve been able to hold the line and really protect ourselves not just for 2020, but going into 2021,” Mumm said.
The City Council expects to adopt a final budget in December.
City revenues are expected to fall by $1.7 million in 2021, largely due to the dropoff in sales tax that began in 2020 when the coronavirus pandemic struck. The budget projects a modest and slow economic recovery, Woodward said.
Woodward said her budget still makes key investments in the areas she’s laid out as priorities during her first year as mayor: public safety, homelessness, housing and economic development.
The budget includes $1.1 million in public safety capital expenditures and a $500,000 contribution for the region’s new mental health crisis stabilization facility, which will open in 2021.
The budget calls for a $350,000 expenditure to continue the police department’s behavioral health unit after a grant that funds it expires partway through 2021. The city will add two new behavioral health positions in addition to the existing employees.
The budget provides $500,000 in funding for a new “bridge” housing shelter, which offers wraparound social services for people experiencing homelessness who are thought to be ready for more permanent housing.
It does not, however, fund night-by-night, emergency shelter for the homeless. Woodward and Beggs said the city continues to negotiate with Spokane County and Spokane Valley on a regionally funded approach to emergency shelter.
“We are discussing, as we continue to work collaboratively with our regional partners on the issue of homelessness, what the commitment level is financially … before we get to a point where we decide how much the city is going to invest in this issue,” Woodward said. “Those are ongoing discussions and we don’t have an answer quite yet.”
Woodward’s budget includes $190,000 to hire three more code enforcement officers to respond to reports of illegal camping.
To help spur economic development, the proposed budget includes three additional permitting positions to reduce application review times. The city also will fill two vacant planner positions, Woodward said.
The presentation Monday was a departure from the budget controversy that engulfed city government last year, when former Mayor David Condon accused the City Council of expanding its own role and endangering the city’s credit rating.
Though formally introduced on Monday, Woodward’s budget proposal has been months in the making. She introduced a preliminary budget in early October, setting a baseline for budget talks.
“Last year, we didn’t start negotiating like this until the end of November, so I feel confident that we will get to a balanced budget before early December and get that passed,” Beggs said.
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