Finance director tells candidates Sammamish faces structural budget gap; utility tax and park district planned to close it

Sammamish Finance Director Vicki Carlson told prospective council members at a candidate orientation that the city’s General Fund faces a structural imbalance and outlined a three-part approach staff and council have pursued to restore fiscal sustainability: expenditure reductions, a utility tax that the council adopted earlier this year, and a voter-approved Metropolitan Park District (MPD) staff hope to place before voters in coming years.

“The fact is … this restrictions on revenue growth is not keeping up with the increased cost of providing the same level of service,” Carlson said, summarizing why the city must act. “We are upside down,” she added when presenting the forecast for the General Fund without new revenue.

Why it matters: the General Fund supports daily operations including public safety. Carlson said property taxes account for 63% of General Fund revenue and are limited to 1% growth plus new construction without a vote of the people, constraining the city’s ability to keep pace with rising costs.

Measures taken and timeline

Carlson described a fiscal sustainability task force formed in 2022 that recommended a three-pronged solution. The city exceeded the initial expenditure-reduction goal (the task force called for $1 million in reductions over three years) and reported total reductions of $8,900,000. The council also adopted a utility tax earlier this year that staff estimate will generate about $11,000,000 in new General Fund revenue when it takes effect “Jan. 1 next year,” Carlson said.

Carlson said the third prong—a voter-approved MPD—would be needed for long-term sustainability if the city wants to preserve current service levels. Scott McCall clarified the timeline: “If we put something on the ballot in 2028, we wouldn’t start seeing full revenues until 2031 if it is approved.”

Budget structure, amendments and constraints

Carlson explained the city uses a biennial budget (the first year of a biennial budget is in an odd year per state law) and maintains multiple funds for specific purposes: a General Fund for day-to-day operations, separate capital funds (transportation, parks), surface water proprietary funds and internal service funds for fleet, technology and risk. She said impact fees and user fees are legally restricted to specified uses and cannot be repurposed for general operations.

She reviewed the mid-biennial amendment process and said staff will present a mid-biennial budget adjustment later this year, with public hearings and adoption expected in October–November. Carlson also said the city will begin providing quarterly financial reports to the council.

Questions from candidates

During Q&A, candidate Dewey (meeting attendee) asked how the 1% property tax increase is applied. Carlson replied: “The 1% increase is applied to the city’s revenue source … it’s not … on the individual’s tax bill. It’s on the revenue that the city generates,” and confirmed the city also receives revenue from new construction or improvements (the “1% plus new construction” rule). Carlson offered to add a more detailed breakout of how much of the recent increase came from the 1% levy growth versus new construction to the public Q&A page.

Other budget details discussed included the sensitivity of revenue forecasts to one-time federal funds such as ARPA, interest-rate-driven investment earnings, and a 15% contract increase for fire services in 2025 that contributes to expenditure pressure.

Ending

Carlson and city staff encouraged candidates to review the full budget and capital improvement plan documents on the city website and to submit follow-up questions via the city’s candidate resources page for public posting.