By Rob Ollikainen
Peninsula Daily News
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The Port Angeles City Council backed the concept of the “long-range strategic financial plan” at a four-hour retreat Saturday at the city fire station.
“What we’re trying to do is establish some predictability,” said Port Angeles Mayor Cherie Kidd.
“At any point, we have the ability to tweak it. The council has the ability to look at it and say: ‘These are special circumstances; let’s reconsider A or B or whatever.’”
City Manager Dan McKeen introduced the plan at the workshop as a “process to address issues impacting the city’s ability to provide services in a financially sustainable manner.”
“It really is the guide for putting together the budget” because it will allow staff to be proactive in anticipating future budget challenges, McKeen said.
“We are looking at something that is a five-year-forward look in relatively significant detail, plus another five years in more of a summary look,” said Chief Financial Officer Byron Olson.
“We always want to keep our eye out for what’s going to happen in the future that could affect the decisions that the council will make today.”
If approved by the City Council in July, the long-range fiscal plan will initially focus on the economic factors that drive revenue and expenses in the context of current service levels.
In the second year, the city will begin to realign its services to meet long-term financial goals.
“This is a practice that’s done by a lot of cities in the state of Washington,” Olson said, “from the Bellevues and the Redmonds and the Kirklands down to much smaller towns that recognize that they don’t have all of the resources.”
The long-range plan may include the legally-allowed, 1-percent increase in property taxes than many cities and counties impose annually.
“We’re trying to create a strategy that makes sense for us,” Kidd said.
“And at every point along the way, we can stop and reevaluate.”
The plan will cover the city’s $120 million total budget, not just the $19 million general fund, Olson said.
The City Council will hold another Saturday retreat to discuss financial projections next month — most likely on April 20.
An early draft of the document will be presented in a public workshop in late May, with subsequent presentations at Utility Advisory Committee and City Council meetings in June.
“Long-range financial planning is really essential if we’re going to be effective in meeting our goals and dealing with our challenges, not just today but also tomorrow,” McKeen said.
“And that’s what we’re really embarking on.”
Olson said the city’s fiscal policies and level of service will be tailored to meet economic conditions.
“What is critical to the city’s long-term financial future is building of our economic base,” Olson said.
“We need more business and industry in this town because we’ve taxed and feed and charged the existing base about as much as we can tax, fee and charge.
“We need to bring in a bigger tax base.”
Among the hurdles on the city’s horizon are the rising costs of criminal justice services.
“It’s consuming more and more resource out of the city at a time that we have less and less coming in,” Olson said.
The city is also facing the loss of liquor tax revenue and the expiration of a $200,000 law enforcement grant.
Several city council members expressed support for the financial planning effort on Saturday.
City Councilman Patrick Downie described the plan as “predictive” and “flexible.”
“I’ve liked what I’ve heard so far,” he said.
“I think we’re doing the right thing for the right reason.”
City Councilman Max Mania said the plan will provide “hugely important context” for the budget.
He added that a key component to the city’s finances will be building up a cushion of reserves.
“If we get from point A to point B and there are those unexpected blips, but we created a plan that allows us to react and roll with it and deal with it and still achieve a fairly balanced outcome, then that is what I would hope and expect,” Mania said.
City Councilman Brad Collins raised the issue of changing council membership, and questioned whether a future council should be obligated to uphold another councils’ pre-authorization of a property tax hike.
“The voters and the issues change quite rapidly,” Collins said, “and I’d hate to think that the current council has made all the decisions for the next council.”
McKeen countered that the long-range financial plan can be adjusted “and may include, on a multi-year level, looking at the 1 percent.”
City Councilwoman Sissi Bruch said contingencies in the plan will allow the city to “not be so reactionary anymore.”
“This should be basic for every council, every year,” Kidd said of the long-range planning.
“We just can’t keep throwing things out to the voters for more and more. We have to understand where we are and plan accordingly.”
Reporter Rob Ollikainen can be reached at 360-452-2345, ext. 5072, or at firstname.lastname@example.org.