City manager outlines changes in preliminary 2026 budget; property-tax revenue rises by about $97,933

City manager Scott Pingle briefed the Newcastle City Council during a budget study session on Oct. 21, describing a modest adjustment to the preliminary 2026 budget and outlining capital and fund-specific plans.

Pingle said the primary change to the preliminary budget is an increase of $97,933 in the real and personal property tax revenue line, driven by updated new-construction estimates from the King County assessor. He described prior-year examples in which new-construction estimates changed materially between preliminary and later figures and said the assessor provides updates that the city must incorporate before final adoption.

Staff reviewed several funds that had not been discussed previously in the budget sessions. For the transportation capital fund, Pingle and staff described a major pavement management overlay planned for 2026 that relies heavily on a recurring state grant (about $900,000) and an additional $250,000 from PSRC; the overlay will cover multiple Newcastle segments including Lake Washington Boulevard SE and large portions of Newcastle Way, Coal Creek Parkway and 116th Ave SE. REET (real-estate excise tax) transfers will provide a large share of local matching funds.

Parks capital proposals include the 129th turnaround construction (noted grant of $335,000 recorded in the book), design work for a dog park and continued support for trail acquisition and development. Staff recommended pursuing a relatively small state capital ask for park development as part of the 2026 legislative priorities.

Pingle described REET receipts and expected transfers: REET revenues were projected at about $1.7 million for the fund, with the largest planned transfer ($2.15 million) to the Transportation Capital Fund. He also reviewed the equipment rental fund and facilities fund changes, including updated equipment purchases (skid steer loader, dump truck upfitting, a new digital reader board and trailer) and adjustments to facility-fee allocations tied to departmental space usage.

Other details discussed included: the schedule for finalist interviews for public works director and the police chief recruitment timeline; the generator project (90% design complete and estimated long lead times for equipment); and the council’s options for property-tax and final budget adoption at upcoming meetings. Pingle asked whether the council wanted an extra study session or to handle final property-tax and budget adoption within the scheduled hearings on Nov. 4.

Council members asked clarifying questions about specific projects (e.g., May Creek Park Drive utility relocations and the generator's maintenance obligations) and expressed support for staff timelines. The council did not vote on a final budget at the Oct. 21 meeting; staff indicated public hearings and property-tax decisions would be scheduled in November with the potential to adopt the budget at the next meeting if council is prepared.