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Mayor Law proposes $457 million budget, some fee, rate increases
Renton's economic picture has brightened, but Mayor Denis Law's two-year budget proposal for the city he presented Monday is still facing a $10 million revenue shortfall that will mean staff cuts, some rate increases and other cost-saving measures.
Law's overall city budget for 2013 and 2014 totals $457 million, with $202 million going to pay for the basic operations of the city, such as police, fire, parks and street repair.
The City Council will begin its deliberations on Law's budget at a Committee of the Whole meeting at 5 p.m. Oct. 22 at City Hall.
The $5 million project shortfall in each of the two years is due to the increasing cost of doing the city's business, according to Law.
In opening his budget address to the City Council, Law said the city has addressed many of the challenges brought on by the Great Recession, including significant drops in revenue from the sales tax and property tax.
Those challenges aren't over, he said, but he believes "we are on the course to recovery."
To help balance the budget, Law has proposed eliminating 25 city positions, mostly through attrition; two employees will lose their jobs. Since 2008, when the recession took hold, the city has reduced its workforce by 15 percent.
The city will save $3 million during the biennium by increasing employee contributions to their medical costs and reducing how much the city pays in medical insurance premiums.
Law said the city has worked with the city's unions "to find a way to reduce costs and save jobs."
Finally, the city would increase fees for business license, the first since 1988, and for the impact of new development that will phase in after 2014. The city will charge insurance companies a medical-transport fee.
Separately, the City Council is considering an increase in the city's utility rates of 5 percent in each of the biennium's two years for water, wastewater, surface water and solid waste.
The additional money is needed to cover debt, improve the city's utility systems and maintain a balance in the utility funds.
Those rate increases would mean an average family's total utility bill would increase $4.53 in 2013 to $95.45 and $4.77 in 2014 to $100.22.
Also proposed is a 0.8 percent increase in the utility tax for water, surface water and solid waste that will go to the general fund, which pays for the daily operations of the city. The increase is covered by savings within the utility divisions and will not be included in utility bills.
Law also pointed to some of the good economic news in the city:
• Growth in businesses and increase in jobs – 200 new firms have located to Renton during the past year and 6,000 new jobs have been added in two years.
• Commercial vacancy rates remain significantly lower than in other cities in the Puget Sound region.
• The Landing continues to add new businesses every month and sales for the businesses at The Landing are up 15 percent over last year.
• The city continues to see an increase in housing sales and has 380 permit requests for new single-family homes.
• The Boeing Co.'s decision to build the 737 MAX in Renton and the increased production of the 737 Next Generation have resulted in more than 1,000 new jobs in Renton, with hundreds of future jobs expected.