Redmond staff warns community‑investment rate is declining; council asks for deeper analysis after 2026 actuals

Deputy Director Harith Nara presented an in‑depth briefing on Redmond’s "community investment rate," a metric that measures city revenues as a share of community personal income. Staff reminded the council that the city has historically used a target band of 5.2–5.5% (adopted circa 2009) and showed that long‑run averages have declined: recent three‑year averages were in the mid‑4% range and the forecast for 2026–2032 showed a projected average near 3.68%.

Nara explained the driver: per‑capita income in Redmond has grown faster than the city’s revenue base, in part because the community’s incomes have risen sharply with high‑paying employers while the city’s revenue sources have not paced at the same rate. He outlined four policy options: do nothing, pursue revenue‑led decisions (evaluate affordability and new revenue tools), consider service‑led corrections (cost reductions, which staff cautioned against as ineffective alone), or recalibrate the target band through a structured evidence‑based review.

Council members pressed on calculation methods (Nara said the data come from state labor and industry and local population estimates), equity implications and local control limits for the metric. Several members favored waiting for 2026 actuals and for staff to return with scenarios, pros and cons, and recommended timelines; staff said they would bring a more detailed package before Q2 2027 after year‑end numbers are closed.