While all cities are unique, there’s something each and every one is sharing this season – the economic fallout from the ongoing pandemic and the accompanying impacts.

Enumclaw is surely no different as city leaders maneuver through the process of crafting a municipal budget for the coming year.

“In 2020, the city experienced unprecedented disruption to its operations and financial stability due to the COVID-19 pandemic and declared public health emergency.” That’s the opening line from an overview of the 2021 budget document, a early piece of the budgetary puzzle.

References to the fiscal ramifications of COVID-19 are liberally scattered throughout the proposed 2021 city budget, which was formally presented by Mayor Jan Molinaro. His version is a starting point; the final budget is approved by a majority vote of the seven-person Enumclaw City Council.

While the mayor, city department heads and others have had input into the proposed ’21 budget, the public will have two opportunities to weigh in:

Two public hearings are planned for the evening of Monday, Nov. 9. The first deals with the preliminary budget as a whole, while the second addresses the property tax levy for the coming year.

A second public hearing on each topic is planned for Nov. 23, to be followed by formal adoption of both the budget and the property tax levy. The adopted numbers must be submitted to King County by Nov. 30.

THE MAYOR’S BUDGET MESSAGE

“This year I am recommending that we approach our city’s budget with caution,” Molinaro wrote at the beginning of his suggested ’21 spending plan. “We must continue to be nimble enough to react to declining revenues with minimizing pain to citizens and services that the city provides. Preparing a budget that factors this into the revenue and expenditures now, will provide less of an impact if the worst occurs in the coming months.”

The mayor offered those comments against the bigger-picture backdrop of COVID-related impacts on daily life, wildfires that burned not far from Enumclaw’s city limits and discussions of social justice issues that reached local neighborhoods.

Considering Enumclaw’s financial outlook for the coming 12 months, Molinaro shared that sales tax revenues are one ingredient that could be a “swing factor.” But other factors also loom large: Will other revenue sources keep pace with years past? Will property tax collections climb with the continued addition of new homes?

Regarding new-home construction, the outlook isn’t as bright as in recent years, the mayor cautioned. “Building permits will begin to step down as large developments have now built out their lots,” he wrote in his annual budget message. “Smaller developments that are now being seen in the community are contributing to some stable revenue, however it is not equal revenue being generated.

In the end, Molinaro said, the proposed 2021 budget “is responsible under current conditions,” provides the necessary core services and maintains a healthy reserve balance to guard against tough times.

HOW MUCH WILL BE SPENT?

The General Fund hits citizens closest to home, as it is the portion of the budget that supports things like police protection, parks and recreation opportunities and services for senior citizens.

The proposed budget released by City Hall notes that the General Fund “is not structurally balanced” and will require $466,000 to be pulled from reserves. The General Fund operating budget funds most city services at current levels and is just shy of $10.9 million.

CAPITAL PROJECTS PLANNED

The total capital budget for 2021 is pegged at approximately $7.1 million, with much of that earmarked for utility projects.

The most visible effort will come at the intersection of Semanski Street and Warner Avenue, where the city intends to replace the current two-way stop with a roundabout. The intersection is a busy one, sitting at the corner of Enumclaw High School and just a few blocks from new housing developments. For the coming year, the city has appropriated $600,000 toward the project.

Other major cost items in the capital budget include:

· completion of the Automated Meter Reading conversion in the water utility, a multi-year project totaling nearly $3 million;

· Waterline replacements, $730,000;

· a two-step Roosevelt Avenue overlay project that has $400,000 set aside for the Semanski to Cole segment and another $280,000 for Semanski to 244th Avenue Southeast;

· Battersby Avenue culvert replacement, $640,000;

· City Hall masonry restoration, $110,000.

WHERE THE MONEY COMES FROM

Talk of money flowing the city’s way begins with a warning in the proposed budget: “The 2021 general fund budget conservatively assumes the local economy will be stagnant due to the COVID-19 uncertainty and thus revenue projections are assumed to be only slightly higher than 2020 year-end projections.”

The city’s three primary revenue sources are sales taxes, property taxes and utility taxes. Each has been impacted differently by the ongoing pandemic.

Property tax calculations begin with the city’s assessed value, a number provided by King County. The early indication is the total value has jumped by $165 million, with about $62 million attributed to new construction. Total property tax collections cannot increase more than 1 percent over the year prior, while also allowing for new construction. Also factored into the final calculations are assessments by the local fire district and county library system.

For the first time in several years, the city is planning to assess its “banked” levy capacity, allowing for collection of another $492,000. When a city collects less than legally allowed, the difference can be “banked” for future use. That’s what Enumclaw is planning for 2021.

Sales tax receipts are anticipated to be flat during the coming year and “continue to be primarily driven by car sales, restaurants, construction and a variety of retail, with an increasing amount of online sales,” according to the proposed budget.

The city anticipates sales tax receipts of about $3.48 million in 2020, slightly above the forecasted amount, reflecting a 3.7 percent increase over 2019.

The city imposes utility taxes on all of its utilities, except stormwater. The 2021 budget recommends maintaining the current utility tax rates. Estimated revenues are $1.906 million, or about $79,000 less than 2020.

As an example of how COVID has impacted budgets, it’s noted that remote has learning dramatically reduced the Enumclaw School District’s utility bills, which impacts utility tax collections.

MOST UTILITY RATES UNCHANGED

It’s noted that most of the city-operated utilities will not see a rate increase for 2021. The exception comes in solid waste, where a planned rate hike is being implemented in anticipation of higher costs to dispose of city trash. Fees at the King County transfer station will likely increase by double digits in 2022 or 2023.