Mercer Island’s City Council now has the 2023-2024 preliminary biennial budget in its hands.
City Manager Jessi Bon and Finance Director Matt Mornick revealed the robust document to council at its Oct. 3 hybrid meeting at a workshop to kick off the review process, which will feature a pair of public hearings and further discussion at upcoming council meetings.
The budget is expected to be adopted by council at its Dec. 6 meeting, following public hearings and analysis at its Oct. 18 and Nov. 15 meetings and a final workshop to receive budget proposal direction at its Nov. 1 meeting.
“This preliminary budget is the city manager’s recommendation to you,” Bon explained to council. “It is ultimately your policy document, so where we planned ahead over the next couple of meetings is, ‘do you agree, what things would you like to see changed?’ and then we will update for your final budget.”
Mornick and a city press release noted that the preliminary budget is balanced and sets financial and staff resources over the next two years to accomplish work plan goals that are guided by council and staff priorities.
In reflecting a measured approach to planning for the next biennium, the budget focuses on municipal services and emergency response efforts, operational services, capital improvements and the city’s critical infrastructure, according to the document.
By the numbers, the preliminary expenditure budget is $98 million in 2023 and $101.1 million in 2024; the general fund expenditure budget is $34.9 million in 2023 and $36.4 million in 2024; combined expenditure budgets for water, sewer and storm water utilities funds are $39 million in 2023 and $37 million in 2024; and an operating deficit is $1.6 million in 2023 and $3.4 million in 2024.
In the operating deficit realm, in which employee compensation increases are forecasted due to inflation rates, “The city is prepared to absorb this in the near-term and will carefully monitor city finances and economic activity to adjust as needed during the biennium,” the document reads. Further in the pages of the document, it is noted that while the city has issued a modest amount of debt over the years, it has been given the highest possible bond rating to secure lower interest rates and reduce debt service costs.
According to Mornick, the city has grown its fund balances over the last two years with assistance of federal aid dollars to help steady its operations into the next biennium. For instance, the city carefully and methodically restored pandemic-caused closures of the thrift shop, community center and recreation programming, he said.
“Our focus over the next six weeks, let alone the next two years, is to maintain a financially sustainable path forward,” said Mornick, adding that it’s taken a full team effort from dozens of staff members to solidify the preliminary budget document.
Added Bon in the document introduction: “The budget is a starting point, carefully built during a time of challenge and change. It will guide the organization as we work to deliver services in a fiscally responsible manner.”
To view the budget, visit https://tinyurl.com/anrvukd4.