Council passes 2015 budget, taxes to rise

December 4, 2014

By Christina Corrales-Toy

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Newcastle homeowners can expect to see a rise in their property taxes, after the Newcastle City Council made changes to, and then adopted, the 2015 budget Nov. 18.

In a 4-2 vote, with Deputy Mayor John Drescher absent, the council elected to take an annually allowable 1 percent increase in property tax and a 3 percent banked property tax increase.

The move will bring the city more than $150,000 in revenue, with an eye toward using it to pay for an additional police officer, said Councilman John Dulcich, who made the motion proposing the increase.

“It fixes a lot of problems and it funds a police officer,” Dulcich said.

Residents can expect the city’s portion of their property taxes to increase an additional $44 next year for a $500,000 home, according to Finance Director Chris Olson.

Cities are allowed to annually impose a 1 percent property tax increase. For the past two years, the council has decided against it.

As for the banked capacity, the state Legislature allows local governments to levy less than the maximum increase in property taxes without losing the ability to levy higher taxes later, if necessary, according to the Washington State Department of Revenue’s website.

The 1986 provision encouraged districts to levy only what they needed, rather than the maximum. Prior to that, governments that took less than the maximum would permanently use some of their levying capacity — essentially using it or losing it.

“The banked capacity concept allowed districts to be more fiscally conservative without being penalized,” the website said.

Earlier in the meeting, Councilman Rich Crispo expressed concerns about how the city would pay for a new officer in 2016. He applauded Dulcich’s problem solving in suggesting the tax solution.

“I think this is the way you have to start dealing with the long term,” Crispo said.

Mayor Steve Buri and Councilman Gordon Bisset did not agree with the tax raise, especially since the city has a surplus.

“I think it’s too much money to take at this time,” Bisset said.

The council spent most of the Nov. 4 and 18 meetings making changes to City Manager Rob Wyman’s preliminary 2015 budget.

They removed funds for a $10,000 customer service survey, took out a proposed parks manager position and nixed Southeast 73rd Place pedestrian improvements in favor of traffic calming measures, just to name a few.

They also added a $25,000 contribution to A Regional Coalition for Housing. ARCH is a partnership of the East King County cities that have joined together to assist with preserving and increasing the supply of housing for low– and moderate-income households in the region.

The 2015 budget includes investment in several transportation capital projects, including a $1 million, grant-dependent plan for Newcastle Golf Club Road improvements and installation of flashing left-turn signals along Coal Creek Parkway.

The City Council approved the 2015 operating and capital budget by a 5-1 vote, with Drescher absent, Nov. 18.

Bisset was the lone dissent, voting against the budget because of the tax increase.

“As always, it sometimes seems like a messy, prolonged process,” Councilwoman Lisa Jensen said, “but I think we come out with a good result as far as the budget.”

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