Tacoma staff outline mid-biennium budget changes as revenues lag; watershed modeling, arts, service cuts proposed

Tacoma finance staff told the City Council Committee of the Whole on Oct. 14 that the city’s main revenue streams are underperforming and presented a mid‑biennium budget modification package that pairs proposed spending increases with program reductions.

"Our revenues, again, are about on projection when you adjust for the, known million dollars, million and a half we don't have," said Andy Turullo, finance director. He added that the city’s largest revenue sources—business tax, property tax, sales tax and utility tax—are “lagging,” and that sales tax estimates have been reduced three times in 18 months. "We still haven't found the bottom of that number," Turullo said.

The mid‑biennium modification (mid mod) presented staffwide additions totaling about $17.6 million, most concentrated in public safety (police and fire) and in increases to third‑party liability and workers’ compensation funds. Staff also identified grant dollars that require council authorization to spend.

Why it matters: City leaders said the mid mod aims to keep core services funded while responding to revenue volatility. Turullo said a conservative projection has not yet been met, putting pressure on the general fund and reserve policy the council adopted in 2021.

Key items summarized by staff:

- Watershed modeling: Ramiro Chavez, director of environmental services, outlined a proposed $1,000,000 contract to fund hydraulic modeling across priority watersheds. The consultant work would develop flow scenarios tied to higher housing density…