Olympia council approves final 2026 operating budget; ordinances to come Dec. 9

The Olympia City Council voted on Nov. 25 to approve the city manager’s and finance committee’s recommendations for the city’s final 2026 preliminary operating budget, including utility rates, fees, special dedicated funds and capital projects, and directed staff to prepare implementing ordinances for council consideration on Dec. 9.

"This budget ... includes some new revenues and reductions," City Manager Jay Berney said in introducing the package, adding that the recommendations reflect months of council and staff deliberations. Berney said the materials presented that night contained no new changes beyond what the council had already reviewed.

Key elements the council approved include a public-safety sales-and-use tax authorized under House Bill 2015, which the presentation estimated would generate approximately $3,000,000 beginning in 2027 (about $1,500,000 pro-rated for the half-year in 2026); an increase to business-and-occupation tax rates estimated to bring about $1,800,000 in 2026; a one-time use of real-estate-excise-tax proceeds to close the 2026 gap; a 2.7% wage adjustment for covered employees; and an additional $1,300,000 to support the development-fee fund.

The presentation listed reductions as well: Berney said eight positions would be eliminated across departments, and the budget would end a federal lobbyist contract. He also outlined proposed fee changes including a 2.7% increase in permit fees, a new $1,000 minor-variance planning fee, and a fire-inspection-permit fee increase (from $39 to $85). Utility rates were presented as a combined 3.74% increase, equivalent to a $12.04 increase on a bimonthly bill.

Finance Director Mike Giffins answered a community question about the parks "11%" calculation and said the city has consistently included a half-percent non-voted utility tax (NVUT) in that calculation since the Olympia Metropolitan Park District was formed; he said staff found one corrected oversight in 2017.

Council Member Gilman moved the measure to approve the budget and direct staff to prepare ordinances; the motion was seconded and approved by voice vote. The council will consider the enabling ordinances at its Dec. 9 meeting for formal adoption.

What to watch next: the ordinances implementing the approved rates, fees and budget adjustments are scheduled to appear on the Dec. 9 council agenda.