City staff told the Shelton City Council on Sept. 23 that the 2026 baseline budget does not include the same general-fund transfer to the street fund that was in 2025; staff proposed a $200,000 general-fund allocation plus the prospect of using real-estate-excise-tax (REIT) funds for street maintenance.

The nut graf: Council members debated short-term stopgaps versus long-term revenue options. Several members urged a study of a transportation-benefit-district sales-tax (TBD) or other dedicated revenue rather than relying on REIT as a recurring source; staff and council agreed to refine options and present a study session focused on transportation funding.

Staff reported that in 2025 the general fund allocated $400,000 to the street fund; for 2026 the baseline shows $200,000 from the general fund with the remaining $200,000 as a policy decision for either REIT or an additional general-fund allocation. Public-works staff explained that reducing the ongoing allocation would push the street program to a more reactive posture and would require scaling back services or staff; City staff said the street fund currently supports about 4.65 FTEs allocated to street operations.

Council members discussed a seasonal five-month employee (estimated $20,000) to address litter, weeds and downtown cleanup during the growing season; several members supported the seasonal position as a small investment with visible return for downtown appearance and commerce. Members also expressed concern about treating REIT as a recurring operating fund: REIT has been used for capital and is limited in scope, so dedicating REIT to ongoing maintenance would reduce funding available for facilities and other capital projects.

Ending: Council asked staff to return with refined estimates and options, including a more detailed look at the TBD sales-tax option and the tradeoffs of using REIT for recurring street maintenance. No final funding decision was made.

Speakers cited in this article

- Mark Ziegler, City Manager (City of Shelton)
- Jay (public works staff, as named in transcript)
- Council member Lindsay (Shelton City Council)
- Council member Gilmore (Shelton City Council)

Authorities

[{"type":"statute","name":"Transportation Benefit District sales-tax authority (RCW referenced by staff)","referenced_by":["streets-and-reit-transportation-funding-options"]},{"type":"policy","name":"REIT (real estate excise tax) allowable uses (as described by staff)","referenced_by":["streets-and-reit-transportation-funding-options"]}]

Actions

[]

Discussion vs. decision

{"discussion_points":["2026 proposed reduction of general-fund transfer to street fund from $400,000 to $200,000","Use of REIT for street maintenance versus capital projects","Potential TBD sales-tax as a stable revenue source"],"directions":["Staff to prepare a study-session presentation on TBD, REIT tradeoffs and revised street-funding scenarios"],"decisions":[]}

Clarifying details

[{"category":"transfer","detail":"General-fund transfers to street fund","value":"2025: $400,000; 2026 proposed baseline: $200,000 general-fund allocation plus $200,000 to be determined (REIT or additional general-fund) ","units":"USD","approximate":true,"source_speaker":"Mark Ziegler"},{"category":"seasonal position","detail":"seasonal employee for downtown cleanup","value":"$20,000 for a 5-month seasonal position focused on litter, weeds and landscaping","units":"USD","approximate":false,"source_speaker":"Mark Ziegler"},{"category":"street staff","detail":"street fund staffing","value":"4.65 FTEs allocated to street operations (as presented)","units":"FTE","approximate":false,"source_speaker":"Jay / Mark Ziegler"}]

Proper names

[{"name":"REIT","type":"other"},{"name":"Transportation Benefit District (TBD)","type":"other"},{"name":"City of Shelton street fund","type":"agency"}]

Community relevance

Geographies: ["City of Shelton"], Funding sources: ["General fund","REIT","TBD sales tax"], Impact groups: ["residents","downtown businesses","commuters"]

Meeting context

Engagement level: multiple council members asked focused questions about service levels and funding tradeoffs; Implementation risk: medium-high for ongoing service cuts or shifting capital funding to operations; History: council has previously transferred general-fund dollars to the street fund and recently used REIT for facilities.

Searchable Tags: ["streets","REIT","transportation-benefit-district","seasonal staff","street maintenance"]

Provenance

[{"block_id":"2106.1501","local_start":0,"local_end":160,"evidence_excerpt":"One thing I didn't mention is the baseline budget, general fund budget did not have an allocation to the street fund as it does this year. We had $400,000 allocation from the general fund to the street fund in 2025. We removed that for the purposes of having that discussion about service levels. In this these department requests, there's a $200,000 allocation from the general fund to the street fund that still leaves another $200,000 that could be offset potentially by REIT or again, real estate exercise tax.","global_start":2106,"global_end":2266,"reason_code":"topicintro"},{"block_id":"7000.875","local_start":0,"local_end":120,"evidence_excerpt":"So the the $400,000 allocation as as was this year with splitting it between street fund and and REIT, I believe that's what we had. We're 1 year stop caps. Okay? But we need to we need to do other things.","global_start":7000,"global_end":7120,"reason_code":"topicfinish"}]