Title
Discussion of Budget Sustainability and the City's 2026 Operating Budget
Recommended Action
Committee Recommendation:
The Finance Committee met on March 17th to prepare for an April City Council study session on budget sustainability. The Committee directed staff to reschedule the Study Session to May to allow more time to gather as much updated budget information as possible.
City Manager Recommendation:
Discussion only.
Report
Issue:
Discuss efforts underway to achieve long-term budget sustainability and to receive an update on the status of revenues and projected expenses that could impact the 2026 operating budget.
Staff Contact:
Jay Burney, City Manager, 360.753.8740
Presenter(s):
Jay Burney, City Manager
Joan Lutz, Budget Analyst
Brandie Andrews, Tax and License Audit Team Lead
Sylvana Niehuser, Interim Parks, Arts & Recreation Director
Sarah Emmans, SME Consulting
Debbie Sullivan, Assistant City Manager
Background and Analysis:
Like most cities in Washington, Olympia's expenses are outpacing revenue generated through sales, property, and business and occupation tax. Our 10-year forecast projects the gap continuing to widen. The City Manager and the City Council's top priority is to develop a long-term sustainable budget. In January 2025, during the City Council annual retreat, they discussed strategies to address both balancing the 2026 budget as well as options for achieving long-term financial sustainability.
Staff will update Council on the status of revenue and expenditures through the first quarter of 2025. This will include information on sales tax, basic life support revenue billed and collected, development fee fund revenue, expenditures related to the Nisqually jail, and the overall 2025 expenditures to date through the first quarter
Staff will also share research presented to the Finance Committee earlier this year regarding business and occupation tax revenue; and engage Council in a discussion on potential options for thei...
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