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Snoqualmie city budget looks to future
The city of Snoqualmie's proposed 2007 budget is another step down the financial path that will free the city from depending on one-time money for core government expenses. By 2008, the city should be able to operate without relying on the crutch of development and building fees that previously had bolstered city budgets, said Harry Oestreich, Snoqualmie finance officer.
The city has a proposed 2007 budget of $46.2 million; $10.4 million of that is in the general fund. The City Council is expected to approve the budget at its Dec. 15 meeting.
Snoqualmie Ridge development has made Snoqualmie the fastest-growing city in the state: the population soared from 1,631 in 2000 to more than 7,815 in April 2006, and the assessed value soared from $313 million to more than $1.2 billion. However, the city's budget became too reliant on one-time fees associated with development, said Snoqualmie Mayor Matt Larson. Former Snoqualmie Mayor Fuzzy Fletcher and the City Council in 2004 began the process of cutting costs and creating a budget that would be sustainable long after building on Snoqualmie Ridge stopped, Larson said.
Oestreich and city administrator Bob Larson were hired to help the city reorganize its finances. Oesterich said the 2006 budget was the first to switch to a more comprehensive layout with more emphasis on the "big picture" than on line item costs. This organizational style was continued in the 2007 budget, he said.
"By looking at the big picture, we're able to evaluate programs and if they're worthwhile to the community," Oestreich said.
Most of the major changes were made in the previous budget; the 2007 budget merely carries on the revamped budget process, he said.
The reorganization also allows City Council members to get a clearer picture of where money is coming from and where it is going, Oestreich said. When the one-time planning and building fees were removed from the general fund budget - which pays for things pertaining to administration, police, fire, parks, emergency management, legal fees and the mayor's and City Council's expenses - it gave council members a better idea of how much of the budget was sustainable should building slow or stop, Oestreich said.
"[Now] we could survive a sudden shut-off of the one-time revenue machine we have up on Snoqualmie Ridge," Oestreich said, cautioning that the city isn't quite "out of the woods."
The city's financial future relies heavily on the state's housing market remaining strong, Larson said. Housing trends indicate that the region could experience a downturn in the housing market beginning in 2007, slowing construction and growth.
However, at the same time new businesses are expected to open on Snoqualmie Ridge. The sales tax revenue they generate should help offset any loss of one-time revenues, Larson said.
To prepare for the eventual slowing of growth, the city - as reflected in the city budget - is limiting expenses at levels that will be sustainable in the future, Oestreich said.
Much of the surplus one-time revenue, instead of being spent on services that won't be sustainable, is being used to build a large reserve and in capital improvements and infrastructure that will last long after the money is gone, Oestreich said.