Cheney council gets first look at budget
Flattened assessed property valuation and reduction in sales tax from construction projects should tighten general fund expenses in 2014
Cheney’s City Council began its 2014 budget deliberations Tuesday night with a look at general fund revenues and expenses and the departments funded through property taxes and other fees.
The city’s property tax assessed valuation is expected to reach $510,239,897 next year, reflecting a relatively flat trend the past five years after a huge jump between 2009-2010 that increased valuations from the mid-$400 million mark to just over $500 million. The general property tax levy in 2014 is a proposed $1,206,497, reflecting a rate of $2.37 per $1,000 of assessed property value.
The Emergency Medical Service levy, in its second year of six, is calculated at $254,379, reflecting a rate of 50 cents per $1,000. But while the EMS funds are dedicated, Finance Director Cindy Niemeier said not all of the taxes paid to the city stay in Cheney.
The school district receives 42 percent of the property tax pie, with the state next at 20 percent, Cheney at 19 percent, county services totaling 15 percent and EMS at 4 percent. At $12.22 per $1,000 of assessed value in 2013, that works out to $5.05 for schools, $2.45 for the state, $2.37 for the city, with the rest divided between EMS, the county and library services.
“The state gets a higher percentage of taxes than the city,” Mayor Tom Trulove said.
Cheney’s proposed property tax assessment for 2014 increases just 2 cents, which combined with the EMS levy means an annual charge of $430.50 for a $150,000 home.
When it comes to general fund revenue sources, property taxes account for 58 percent of what the city takes in, followed by intergovernmental sources – fees, licenses, etc. – at 24 percent and charges for goods and services at 12 percent. The major sources of tax revenues will come from property, utility and sales and use, with city officials anticipating a drop off in sales tax due to several major construction projects at Eastern Washington University wrapping up and nothing coming down the pipeline.
“Last year was a record breaking year for our sales tax,” Niemeier said of 2012. “We’re not going to achieve that this year. We will slightly reach our budget of $1.2 million collected.
Cheney’s utility tax revenue has maintained a relatively smooth pattern of increases since 2004, something Niemeier said is good considering how much the city has grown in that timeframe. One area the city has seen a big revenue impact is liquor excise sales taxes, which have fallen drastically since a voter initiative privatized liquor sales in 2012.
Niemeier said the city received some profits from the sales of state liquor stores, but as of right now hasn’t seen much in the way of revenues it is supposed to receive from the state in both excise and sales profit monies.
“The excise tax is still a little bit up in the air,” she added.
Department heads from the six departments funded through the general fund presented budget information at Tuesday’s meeting, although due to a glitch in the city’s computer system not all information was available at press time.
In other action, the council approved two Police Department resolutions. The first was accepting a $2,196 grant from Bureau of Justice Assistance for replacement of bulletproof vests. Police Chief John Hensley said vests are replaced on a rotational policy, with 3-4 being replaced this year.
The council also approved a four-year lease of a police vehicle for the Cheney School District student resource officer. The city and school district agreed the district would provide the vehicle as part of its contract, but are prohibited from owning a police vehicle.
Instead they have agreed to reimburse the city for the $44,029 cost of the agreement with First Capital Equipment Leasing Corp.
Finally, the council heard an information only presentation from Spokane County Commissioner Al French on Proposition 1, a ballot measure to increase the regular property tax levy 6.5 cents per $1,000 in order to raise $18.1 million over nine years to purchase property that commissioners and county business groups see as threatening Fairchild Air Force Base. The money would be used to purchase 188 mobile homes located in Accident Potential Zone 2, inside the city limits of Airway Heights, and move those to remove the encroachment threat to the base.
John McCallum can be reached at email@example.com.