At the Kenmore City Council meeting in September 2025, Finance and Administration Director Melinda Morel presented the city’s second‑quarter financial report (through June 30, 2025), reporting revenues ahead of the biennium target and identifying several areas that will require further staff work, notably the city’s automated traffic‑enforcement program (CAPE).

Why it matters: The report showed stronger‑than‑expected revenue in several categories and a large reserve balance, but it also flagged operational and legal questions tied to CAPE, the public‑works operations center schedule and debt service assumptions that affect future budgets.

Key figures and takeaways: Morel said the city is 25% through the biennium and that total general‑fund revenues were at 28.3% "a little bit up for the year," while total general‑fund expenditures were at 22.6%. She reported higher investment income, noting "Our average yield ... is 3.81%," and said permit and development‑fee revenue is above target now that staffing is restored.

The council was told the city’s general‑fund reserve policy requires maintaining reserves of not less than 20% of annual operating expenditures (shown as $3,800,000 for the biennium) and that current reserves total $11,500,000. Morel said the city holds about $12,000,000 in bonds staggered to mature in short windows and that money in LGIP and money‑market accounts is earning higher yields.

Automated enforcement (CAPE): Morel highlighted automated enforcement as a complex area needing deeper analysis. She said the city has recorded about "40,000 through August. 40,000 speeding infractions, light infractions. 40,000. That's huge. That's double Bellevue's." County reconciliation processes delay full accounting, and the county estimates Kenmore could have 60,000 infractions for the year; at $100 per infraction that would be $6,000,000 in gross fines, though Morel cautioned that court processing, dismissals and reconciliation make actual net revenue uncertain. She said the city needs more analysis on cost‑benefit, including the vendor fee structure (Verra Mobility) and potential court staffing impacts.

Capital and operations notes: Morel said the public‑works operation center site work is underway and construction is scheduled January 2026–January 2027; larger charges are expected in 2026. She also told the council that planned annual contributions toward public‑works debt will be lower than budgeted: rather than $900,000 per contributing fund, the city now expects to need $800,000 annually from each, reducing the biennial contribution estimates.

Council questions and follow up: Council members asked about the legal ability to prepay debt, the specific investments the city holds (treasuries and LGIP only), and whether tariff or supply pressures could change construction costs; Morel said the city is monitoring those risks. Council member Sassen asked whether other cities have comparable automated enforcement experiences; Morel said Kenmore’s volume is unusually high and that staff will continue analysis. Council member Lutzis asked whether the city invests in instruments beyond treasuries and LGIP; Morel replied the city is limited to permitted public‑sector investments.

What was not decided: The report was informational. Council asked staff to continue analysis of CAPE cost‑benefit, court impacts and vendor fees, and to refine reconciliations with King County; no policy change or budget amendment was adopted at the meeting.