Tacoma City Business Preview - Week of December 2, 2014

Last week's Council meeting agenda may have been short and sweet, but this week's is anything but. The long list of resolutions and ordinances up for Council consideration this week includes budget adjustments and spending plans, and rate and fee increases for various City services. It could be a pretty epic meeting.

Budget

As we near the end of the year, we also near the end of the budget process for the upcoming biennium. A City Council study session and two ordinances scheduled for first readings this week move us closer to that. As the City Council prepares to adopt a final budget for the 2015-2016 biennium, there will be a wrap-up discussion at this week's study session. 

Then at the regular Council meeting, the first of two ordinances deals with the current budget for the current biennium, making modifications to appropriate funds for additional contractual obligations, transfers, and other budget adjustments in the 2013-2014 City budget. The modifications recognize new revenue, budget for resolutions passed by the Council, adjust for other changes over the course of the biennium, and make other corrections to the budget prior to the close of the biennium.

The last ordinance on this week's lengthy agenda is possibly the most important - it would approve the 2015-2016 Biennial Budget for the City of Tacoma. We’ve been through an extensive public input process, including public hearings in recent weeks. We’re getting down to the eleventh hour for changes, but the final budget isn’t scheduled for final approval until next week’s Council meeting, so you never know...

Policy Agendas

Looking ahead to 2015, the Council will also hear about a draft of State Legislative and Federal Policy Agendas for the City for the next year. This annual statement of the City's priorities includes, among other things, language reflecting a desire for more local control of finances.

The City believes local control of tax and regulatory processes is in the best interest of city residents and businesses. Local control allows innovation and greater flexibility to match taxes and regulations to a changing local economy. Local control also means allowing the City more authority over its local taxes, such as business and utility taxes. The City supports removing existing State controls over these taxes to allow the City to become less dependent on shared revenue from the State. The City also supports changes to the 1 percent cap on property taxes that will allow growth in revenue year over year of up to the rate of inflation in Washington. 

In a conversation earlier this year City staff and Council discussed a potential shift in legislative philosophy to extend support for fiscal home rule for Tacoma and other cities, potentially going so far as to sacrifice some State revenue. That discussion was a part of the biennial review of the City's legislative policy statement. The decision was ultimately made to back down from language that would have suggested the sacrifice of state funding in exchange for local control, but to keep language supporting the concept of fiscal home rule for cities.

Following that discussion, this draft of policy agendas for Tacoma in 2015 more explicitly lays out areas where the City sees opportunities for local control of revenue. Along with local control over business and utility taxes, and changes to existing caps on property taxes, the draft includes an argument in support of the State sharing fees and taxes collected on legalized marijuana with the cities where those businesses are located.

The draft lays out other priorities for Tacoma at the state and federal levels, including increased investments in transit and transportation infrastructure, gang reduction, green infrastructure, veterans support, advances in equity and empowerment initiatives, continuation of the EB-5 immigrant investor program, and federal support for local housing programs.

Rates & Charges

An ordinance on this week’s Council meeting agenda for a first reading would implement increased rates and charges for Wastewater and Surface Water Management services for 2015 and 2016. The rate increases, driven primarily by increased labor costs and increased investment in infrastructure, would be at 6% per year for Wastewater, and 5.5% per year for Surface Water. 

A second ordinance up for a first reading this week would increase rates and charges for Solid Waste, Recycling, and Hazardous Waste services for 2015 and 2016 by a proposed 5% per year.

Fire Department Rates & Charges

An ordinance up for a first reading would amend the Municipal Code as it relates to Ambulances, to allow charges for non-transport related emergency medical advanced life support services and establish a base rate for such services.

Tacoma Fire Department is currently authorized to charge for advanced life support services when patients are transported to a hospital emergency room by ambulance.  Due to improvements in emergency care, some emergency medical conditions are now more frequently able to be stabilized without an emergency room visit. Insurance companies are increasingly willing to accept charges for these non-transport services, saving the cost of the emergency room trip, while still allowing fire departments to get paid for their services.

The new proposal would allow Tacoma Fire to charge for some non-transport related emergency medical services, such as diabetic or asthmatic stabilization.

Another ordinance scheduled for a first reading would adopt fees for Tacoma Fire Department code enforcement inspections of industrial, commercial, and multifamily structures. The periodic code inspections are one of TFD's fire prevention activities, giving the Fire Department the opportunity to identify fire code violations, educate business and property owners, reduce fire loss, and reduce demand on emergency services. Charging a fee will help offset inspection costs. Though they will not fully fund the program, they will help reduce dependence on federal grants to maintain staffing.

B&O Tax Exemption

An ordinance up for a first reading this week would exempt businesses with an annual gross income of less than $250,000 from filing a City business and occupation tax return. In 2011 the City passed an ordinance exempting those businesses making less than $250,000 from paying a local B&O tax, but still required them to file a tax return with the City indicating that they owed no tax.

5,400 businesses fell into this category of not being required to pay the local B&O tax, but still being required to file a tax return with the City. The elimination of this requirement is expected to save about $15,000 in printing and mailing costs in the next two years, as well as saving staff time.

Capital Facilities Plan

An ordinance on this week’s agenda for a first reading would approve the 2015-2020 Capital Facilities Program. The Capital Facilities Program is a tool for outlining the City's strategic direction for community development through capital projects. The program indicates existing and proposed capital facilities projects throughout Tacoma. Inclusion in the plan doesn't mean that funds have been set aside, but it indicates the project as a priority for the City, leaving the door open for funding.

Lincoln District Streetscape

The City committed to funding streetscape improvements for the Lincoln District and South Tacoma Way as part of the proposed 2015-2016 budget. An ordinance on this week’s agenda for a first reading would reallocate $3 million of unspent funds to the Lincoln streetscape improvements. The funds come from about $3.16 million in unspent project funds originally allocated to various other projects like Cheney Stadium, Salishan, Old Town Dock, and Brownfields. The funds have to go toward capital projects like the Lincoln improvements.

Sidewalks

Also on this week's consent agenda is the first and final reading of an ordinance approving and confirming the Assessment Roll for the construction, reconstruction, or repair of certain sidewalks at 91 locations throughout the city. Way back in 2011 Public Works initiated unsafe sidewalk procedures on the 91 properties listed. Property owners were notified that their sidewalks were considered unsafe and would be reconstructed by the City at owner expense. The work has since been completed, either by the City or by the property owners themselves. For the work done by the City the final assessment roll totals  $ 168,472, significantly less than the $314,577 preliminary assessment. Those property owners will now have five years to pay off their portion of the costs.

Purchase Resolutions

Three purchase resolutions appear on this week's Council meeting agenda.

• A $758,976 contract, plus sales tax and licensing, budgeted from the 2010 LTGO Bond Fund and General Fund, for one Rosenbauer 109-foot aerial ladder truck
• A $700,000 contract, plus variable fees, budgeted from the Convention Center Operating Fund, for four years of food and beverage services at the Greater Tacoma Convention and Trade Center, from 2015 through 2018.
• A $4,714,488 increase to a contract for mobile, marine, and cardlock fueling and carwash services, bringing the cumulative contract total to $18,820,890, budgeted from various departmental funds, and extending the contract through January 31, 2016.

Other Items

A resolution on this week’s Council meeting consent agenda would approve the final plat of “Theresa Estates,” an 8-lot subdivision, for single-family development, located at 250 and 256 East 66th Street.

A resolution on this week's regular Council meeting agenda would make two appointments to the Tacoma Planning Commission.

Another resolution on this week’s agenda would authorize an agreement accepting $30,000 from the Washington State Department of Health for a feasibility study on acquiring the Andrain Road Water Association service. The Andrain Road Water Association provides services to 59 residences in the vicinity of 12Sth Street East and 70th Avenue East in Pierce County. Because of limited capacity of the system, the association has not been allowing new service connections. Rather than make improvements to allow for more connections, the association has asked to be acquired by Tacoma Water. The $30,000 grant would pay for the topographic survey and engineering needed to determine the feasibility of Tacoma Water acquiring the Andrain service area. 

An ordinance scheduled for a first reading would amend the Municipal Code, relating to the Compensation Plan, to implement rates of pay and compensation for represented and non-represented classifications, and changes in classifications to reflect the organizational structure. Five related resolutions would authorize the execution of Letters of Agreement with five groups of represented City employees affected by the changes.

Human Services

Also on the agenda for this week's City Council study session is a presentation of recommendations for Human Services Funding (Community Services and Mental Health Substance Use Disorder funding) for 2015-2016 in alignment with the service priorities as adopted in the 2015-2019 Human Services Strategic Plan.  A final resolution on the agenda would approve these funding recommendations.