Kent City Council to use reserve funds to help pay for parks

The Kent City Council will use $2 million in 2017 from its general fund reserves and $2 million in 2018 from its capital reserve fund to pay for park improvements rather than raise property taxes.

Councilman Jim Berrios proposed the amendment to the 2017-2018 city budget to use reserve funds rather than raising property taxes to bring in $2 million per year for park projects as proposed by Mayor Suzette Cooke. The council voted 5-2 in favor of the proposal on Tuesday night. Dana Ralph and Les Thomas opposed it.

“I want to just express that as a property owner in Kent in my particular business I hear a lot of people share concerns about a multitude of things as far as what’s happening in the city,” said Berrios, who owns the Golden Steer Steak ‘n’ Rib House on the East Hill. “One of the things I keep hearing is their concerns about our council through this budget that’s being proposed is considering raising property taxes.

“And this is after ST3 (Sound Transit) passed. We aren’t even going to see what happens with that (property tax increase) until April and then we’re going to say, ‘Oh my gosh.’ In addition to that, as a city we’ve raised water and sewer rates. … We added the solid waste utility tax for neighborhood roads.”

Cooke proposed that the city use some of its nearly $6 million in what’s known as banked capacity because the city reduced its property tax levy by $1 per $1,000 assessed valuation in 2011 after voters in 2010 approved the formation of the Kent Fire Department Regional Fire Authority, which levies a property tax of $1 per $1,000 assessed valuation. State law allows a city to raise property taxes above the 1 percent maximum per year if it has banked capacity.

Berrios, who is running for mayor next year, said he proposed to use general fund reserves because city Finance Department staff estimate that account will hit $15.2 million at the end of this year or 16.9 percent of the general fund budget. He said the general fund reserves were at just $643,000 in 2011 or 1.9 percent of the general fund.

“Our policy as a council on fund balance is 10 percent of current year expenditures,” Berrios said. “I’m proposing taking $2 million of the excess dollars and giving it to parks.”

The $2 million each year to fund parks capital and major maintenance projects will include renovations at Lake Fenwick Park, West Fenwick Park and Kent Memorial Park. City staff has said the parks maintenance backlog is more than $60 million.

Ralph, who also is running for mayor next year, opposed using general fund reserves.

“This is a giant step backwards,” Ralph said. “This is not moving us forward. This is not allowing us to have that (city) vision. We know tough times will come that’s just what happens. We start getting comfortable with dipping into these reserves. … It’s a slippery slope.”

The amendment by Berrios also included using $2 million in 2018 from the capital reserve fund (used for streets, facilities, parks and other projects) to go strictly to parks. He said he talked to Finance Director Aaron BeMiller and was told $1 million in the capital reserve fund is a good amount, and that the end of this year that fund will hit $7.4 million.

Prior to approval of using reserve funds, the council voted 5-2 against an amendment by Ralph to use $2 million per year of business and occupation tax funds to pay for park projects. Ralph and Dennis Higgins were in favor of using B&O revenue, which will bring in about $8.8 million in 2016.

“We have been talking about our need for parks capital for over five years,” Ralph said. “Due to a variety of things, including the recession, we have not been putting money into our parks system. We have no plan and our needs are growing. Something needs to be done and it needs to be sustainable. … It’s time for us to make some bold and deliberate decisions and that is funding our park system with something that is sustainable.”

Most of the rest of the council, however, said that they agreed the business community had been told B&O revenue would pay for street projects and not be used for anything else.

“I look at this agreement that we made with the businesses that the B&O money will go for the roads,” Council President Bill Boyce said. “Until all these projects get done, and we have a lot of work to do, it’s like robbing Peter to pay Mary or Peter to pay Paul or however you want to say it. We are not there yet. I strongly believe we need to do something bold with our parks but I don’t believe this is the right thing to do.”

After the amendment votes, the council voted 5-2 to approve the 2017-2018 budget, including a general fund budget of $94 million in 2017 and $96 million in 2018. Ralph and Thomas voted against it.

The budget includes funding for three new police officers in 2017 and four in 2018 as well as a new communications coordinator.