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New Everett finance director reports small 2025 revenue variance; council debates using excess fund balance to avoid cuts
Summary
Chris Godwin, Everett's finance director, told the Budget & Finance Committee that 2025 revenues roughly matched forecasts and that a $21M CIP fund balance and $33.8M reserve target give the city flexibility; Council members debated using excess fund balance to close budget gaps and investing in permitting capacity to spur revenue.
Chris Godwin, the finance director for the city of Everett, opened the July 15 Budget & Finance Committee meeting with a review of the city's 2025 budget performance and an outline of the 2027 budget calendar.
Godwin said the 2025 revenue forecast was $169,600,000 and actual performance was $170,000,000 — a variance of about $424,000, or 0.25% — and that higher-than-anticipated grant and internal service revenues helped offset a roughly $1.3 million shortfall in sales tax collections. "In 2025, our revenue forecast was a 169,600,000, and that was measured against the performance of a 170,000,000," Godwin said.
On expenditures, Godwin reported the city spent about $171,500,000 in 2025 against a budget of $180.2 million, an approximate $8.5 million (4.8%) underspend he attributed to department-level savings and timing differences. "This is, in line with the performance that we've seen in prior years and is largely reflective of every department's initiative to monitor their budget and to try to pinch pennies," he said.
Godwin reviewed capital funds and balances that will affect near-term spending decisions. He said CIP 1, established in 2016 and supported by a $3,000,000 annual general fund contribution, is expected to end the year with roughly $21,000,000 available to pay for already-approved projects. Godwin listed projects likely to draw on that balance, including the main library HVAC replacement ("upwards of $5,000,000"), police property-room and bathroom renovations and a boathouse replacement. He also summarized CIP 2 (REET-funded debt service for previously issued bonds), CIP 3 (projected year-end balance about $9.1M for park projects) and CIP 4 (lease-revenue funded, projected about $737,000).
The fund-balance discussion prompted pushback from Councilman Wright, who urged using the city’s excess fund balance to close budget gaps rather than making cuts. "I would support using our fund balance to meet our budget gap for the year, instead of making cuts," Councilman Wright said, calling the surplus "taxpayer dollars" that could be better used now. Godwin clarified that a separate rainy day fund exists and said the city's $33.8 million target — roughly 20% of anticipated revenues — is intended to protect cash flow and allow the city to meet obligations when revenues lag.
Council discussion also touched on deferred maintenance and the long-term adequacy of the $3,000,000 annual CIP 1 contribution. Councilor Hans Marbatten asked for a future report identifying an appropriate annual set-aside to avoid deferred-maintenance shortfalls given rising construction costs.
Beyond closing budget gaps, the council discussed investing in capacity to speed permitting as a revenue-generating option. The council president suggested the administration consider a budget amendment to address permitting backlogs and staffing so development that generates tax revenue is not stalled. Councilor Zamingo also asked for details on a previously discussed effort to use grant-funded artificial-intelligence tools to streamline permitting intake.
Godwin outlined the 2027 budget schedule: departments receive guidance and submit initial materials in late summer, a revenue projection will be finalized by the end of July, final guidance is issued in August, hearings begin in September (the transcript notes Sept. 2 and hearings on Sept. 9 and 16 for a 2026 amendment and that Sept. 16 will start '27 budget balance discussions), a revenue workshop is set for Sept. 30, the mayor's budget presentation is planned for early October, the proposed budget will be submitted to council in late October (tentatively Oct. 21), and council must approve the budget by Dec. 2 to meet the state's timeline.
The finance director said the next council hearing tied to these items is expected Sept. 16, with earlier amendment hearings beginning Sept. 2. No formal motions or votes were taken during the portion of the meeting covered by the transcript.
The committee moved on after the presentation; council members requested follow-up information on deferred-maintenance targets, the composition and planned uses of CIP fund balances, and practical details on proposed permitting improvements.
