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Yelm reviews mid‑biennium budget; public hearings on property tax set for Nov. 12 and Nov. 25
Summary
City staff told the Yelm City Council on Oct. 14 that the mid‑biennium budget shows few new projects in 2026, explains why the property‑tax rate is falling despite a steady levy, and schedules two public hearings in November on the property tax and budget amendment.
City of Yelm staff presented a mid‑biennium budget review Oct. 14 and told the City Council that although the city’s levy amount is roughly steady, the city’s property‑tax rate is falling because assessed values have grown.
The presentation, given by Stephanie, a city staff member and the meeting’s budget presenter, also outlined expected increases in salaries and benefits, a 3% cost‑of‑living adjustment tied to labor negotiations, and a 15% rise in the Labor & Industries rate for law‑enforcement—factors that will be reflected in the mid‑biennium budget amendment to be considered this fall.
Why it matters: the council will consider the property‑tax ordinance and a mid‑biennium budget ordinance at two public hearings in November, and those hearings determine the taxes and spending levels that affect city services and capital projects.
Stephanie told the council the city’s calculated levy rate is “about 94¢ per thousand,” and explained the rate fell because the assessed‑value denominator grew faster than the levy numerator. “The reason that our rate is getting lower is because although our levy amount, our numerator is staying pretty much equal, it's the denominator. It's the assessed value. It's grown so much,” she said.
Staff said there are few new capital projects budgeted for 2026; several 2025 projects that are unfinished—most notably the water reclamation facility—will roll into 2026. Staff also said the city paid off a bond early in 2025 and transferred excess general‑fund reserves to a building fund, which produced a one‑time increase in 2025 capital expenditures.
On recurring costs, staff identified insurance costs rising about 3% for 2026 and the COLA as 3% tied to labor negotiations; medical and dental benefits are also expected to increase. The council was told the city budgeted to add two police officers next year, funded by the public‑safety sales tax.
Staff reviewed individual fund health: the water fund was described as “very healthy” with reserves earmarked for upcoming water capital work and a new water tower that will hold 1,500,000 gallons; the sewer fund had a projected low ending balance but staff expected that projection to improve as capital work completes; stormwater and IT funds were characterized as healthy; and the equipment replacement (ER&R) fund is expected to realize savings by renegotiating vehicle lease arrangements—reducing costs for most city vehicles while police vehicle purchases remain separate.
Stephanie said two public hearings are scheduled: Nov. 12 will include the first reading of the property‑tax ordinance and the first reading of the mid‑biennium budget ordinance; the second hearings are scheduled for Nov. 25, after which council adoption is anticipated. She said the city expects to receive final levy numbers from the Thurston County assessor before Nov. 12.
No formal council action on the budget occurred Oct. 14; staff said the current presentation is part of the process leading to the November hearings and the formal budget amendment.
