Kenmore’s finance director told the City Council Tuesday that mid‑biennium revenues are slightly ahead of schedule while expenditures remain below the 25% elapsed target, driven by higher investment income and development‑fee activity. Finance and Administration Director Melinda Morel said general fund revenues are at 28.3% of biennial expectations and expenditures at 22.6%, and that the city’s reserves stand at $11.5 million versus a 20% policy floor ($3.8 million).

The report also flagged a fast‑growing automated enforcement program, referred to in the presentation as CAPE. Morel said the city logged about 40,000 infractions through August and that King County estimates 60,000 by year‑end. "If 60,000 infractions were all collected at $100 each that would represent $6 million," Morel said, while cautioning that court dismissals and reconciliation processes make actual revenue uncertain.

Why it matters: Higher interest rates and strong permit activity have improved near‑term revenue, which the city has used to lower expected debt contributions for a planned public works operations center. Morel said initial debt contributions budgeted at $900,000 per fund can be reduced to $800,000 each after finalized issuance, lowering the biennial debt burden by roughly $400,000. At the same time, CAPE’s volume has placed strain on court reconciliation and could require additional court personnel, which would reduce net revenues.

Details from the presentation: Morel told council members that investment yields were strong (average yield reported at 3.81%) and that the street fund is ahead of target because of permit fee receipts. The public works operations center site work is underway, with construction slated January 2026–January 2027; larger construction charges are expected next year. The city is holding roughly $12 million in short-term bond investments and additional funds in LGIP and money‑market accounts to meet cash needs.

Council reaction and next steps: Councilmembers asked staff to model scenarios: how many infractions will actually convert to revenue after court reconciliations, whether courts will need more staff, and what the net fiscal effect will be after vendor fees and court costs. Councilmember Lutzis asked whether keeping higher reserves and applying extra payments to debt service would be advisable; finance staff said they would analyze legal and fiscal tradeoffs and report back. Councilmember Sassen and others asked whether other jurisdictions offer comparable examples for managing camera‑based enforcement; staff said the city has not yet found a direct analog in scale and will continue comparative outreach.

The council did not adopt any new revenue or spending measures at the meeting. Staff said follow‑up work will provide more detailed CAPE revenue modeling, an analysis of court reconciliation timing and costs, and updated forecasts for the public works operations center and debt service.