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WES advisory committee previews pilot to move to a two-year budget as staff outline fiscal outlook
Summary
Water Environment Services (WES) told its advisory committee it will ask the county board to pilot a two-year budgeting cycle while staff warned projected resources are about 2.5% below adopted expectations because of lower SDC revenue and a delayed congressional earmark.
Greg Derto, director of Water Environment Services, told the advisory committee he will present a policy session to the county board and public proposing a pilot of a two-year (biennial) budget while continuing annual audits and annual rate-setting.
The proposal, Derto said, is intended to reduce the staff burden of an annual full-budget cycle: "We're going to have a policy session in front of the board and the public about WES piloting a two-year budget," he said. "It kind of gets us off the hamster wheel, so to speak."
Why it matters: WES staff told the advisory committee that moving to a biennial budget could help better align multi-year capital projects with budgeting cycles and reduce repeated administrative work. Erin (finance staff) and Aaron (budget staff) described how the change would interact with reserves, the five-year capital plan and statutory public steps in the budget process.
Fiscal highlights presented to the committee included: projected total resources about 2.5% below the adopted budget due to lower system development charge (SDC) receipts and a delayed $2 million congressional earmark for a boring treatment plant project; higher interest income (reported at about 17.2% above budget) driven by elevated local investment rates; and labor costs approximately 5% (about $900,000) over budget because of lower vacancies and recent compensation adjustments. Staff also reported an expected ending fund balance of roughly $122 million, with the majority of those funds held in construction and system development charge accounts.
Erin described specific variances: WES received ARPA funding for the Upper Kellogg project and a Metro Nature & Neighborhoods grant for Three Creeks, but a congressional earmark expected for another project did not materialize in the current year, shifting revenue timing. On SDCs, she said a postponed fee increase (methodology updated in September, rate implemented in November) contributed to the near-term variance rather than fee waivers.
On capital spending, staff said timing shifts explain underspending in some projects this year (for example, Tri City influent pump station work starting later than budgeted) and that construction season timing is a driver the biennial budget aims to address. The presentation emphasized continued reliance on the long-range financial plan and use of reserves for capital financing; staff said they do not anticipate issuing new debt next year.
The committee discussed next steps for public review: staff will meet the county administrator before beginning the public phase and, if the board approves the pilot, the budget document will be distributed in early May with board adoption planned for June.
Action taken: The advisory committee moved and seconded a recommendation to reappoint Mayor McGriff to the budget committee for the upcoming budget period and recorded a roll-call affirmation to send that recommendation forward. The committee also approved the January minutes earlier in the meeting by motion and roll call.
