Burien finance forecast shows shortfall by 2027; levy lid lift would create multi‑year surplus if voters approve

Lede: A consultant and city finance staff told the Burien City Council on April 21 that the city’s existing revenue picture — softer sales tax receipts and rising contract and personnel costs — would drive the general fund below the council’s 20% reserve target by 2027 and could produce a negative fund balance by 2028 if no new revenue or expenditure changes are made.

Nut graf: The presentation outlined two scenarios: a base forecast showing persistent shortfalls and a scenario that includes a proposed levy lid lift (doubling the current levy) that, according to the city’s consultant, would produce a multi‑year surplus and add about $2 million in ongoing capacity per year from 2026 through 2030. Council members followed the presentation with questions about timing, impacts to police contracting and how federal/state pressures could affect local receipts.

Body: Robert Hammond of FCS Group presented the six‑year general fund forecast and the updated revenue assumptions, saying that the forecast used actuals through February 2025 and current 2025 assumptions. Hammond noted the city’s financial policies call for a minimum fund balance equal to about 20% of recurring revenues — roughly $7,000,000 for 2025 — plus reserves for capital partnership and equipment of about $10,000,000.

Hammond described several changes affecting the outlook: implementation of an increased business and occupation (B&O) tax and higher utility tax rates effective Jan. 1, 2025; a recent softening in sales tax receipts (including declines in auto sales); and slower local employment and construction growth in King County forecasts. "You would be below, you'd be negative fund balance by '28 if nothing changed at all from now to then," Hammond told the council.

Under the base scenario (no further rate changes), expenditures — driven primarily by the King County police contract (police comprises about 41% of general fund expenditures), personnel costs and inflationary increases — outpace revenues and erode reserves in the 2026–2028 biennium. The forecast assumes general fund operating expenditure growth of roughly 3–5% annually and projects a sales tax slowdown through 2025 with a modest rebound afterward.

Hammond also modeled a scenario that assumes voter approval of a levy lid lift that would double the certified levy rate beginning in 2026. That scenario makes property tax the city’s largest ongoing revenue source (replacing sales tax), reduces volatility and produces a projected ongoing capacity increase of about $2,000,000 per year for 2026–2030. With those assumptions, the city’s fund balance could reach roughly $30.9 million by 2030, the presentation said; staff emphasized that the levy would be subject to voter approval.

Council members asked how this forecast compared with the prior “fiscal cliff” the city addressed in earlier budget cycles. Hammond and city staff said council actions taken previously — the higher B&O and utility tax rates — helped buffer the city but that new contract increases and recent sales tax softness have partially reversed earlier gains. Councilmember Deborah Mayer asked whether the current trend was an accelerated repeat of the prior cliff; staff replied the drivers differ now (sales tax softness, auto sales drop, contract bills) though the fiscal risk remains.

Council discussion also touched on implications for public safety contracting: staff reported ongoing coordination with the King County Sheriff's Department; staffing constraints at the sheriff’s office have impacted service levels, but officials said positions are expected to be filled, and absent new revenue the city “will have to make some hard choices,” a council member said.

Ending: Staff recommended continuing to monitor receipts, to refine forecasts as more months of data become available and to return to the council with options. No formal council action was taken during the presentation; council members signaled interest in further discussion of revenue options, including the levy lid lift and other council‑level levers.