SPOKANE, Wash. — When former Spokane Mayor Nadine Woodward left office at the beginning of the year, she left behind what she said was a balanced city budget for 2024. However, current mayor Lisa Brown said this is not the case. In fact, the city is in a deficit that is two times as large as previously thought.
Brown, Spokane City Councilmembers and other city officials met Thursday morning to discuss the city's $50 million budget deficit and to consider how to get out of it. During the meeting, city officials discussed options for pulling the city out of the deficit, including implementing furloughs, suspending certain positions and negotiating employee contracts.
Mayor Brown revealed for the first time Wednesday that Spokane's deficit is currently at $50 million. She sent KREM 2 the following statement regarding the budget:
"The City of Spokane is facing a $50 million structural deficit across all city accounts. Many different factors have led to this situation, including inflation, rising compensation costs, and past uses of one-time federal funding for ongoing expenditures.
If we don't act quickly to correct the situation, we will see impacts to many of our basic services - things like filling potholes, and maintaining reliable water and refuse utilities.
Spokane’s Fire and Police departments need maintained and upgraded vehicles and additional personnel in order to provide the critical services that our citizens need. Unfortunately, there was no plan in place to add the necessary resources to meet that demand.
In addition, the city’s Neighborhoods, Housing, and Human Services Department needs an adequate level of funding to provide the proper attention and care to people experiencing homelessness and navigate them toward long-term housing solutions.
Our city’s long-term financial health has been imperiled by misguided past decisions to fill operational gaps with strategic reserves.
We need to find solutions to this budget crisis, but I am confident that we will. We have a talented and disciplined leadership team that is committed to preserving our financial future for generations to come."
During the meeting, city officials acknowledged that several "unsustainable levers were pulled" in order to balance the 2024 budget. Some of those allocations include $3.95 million being used to defer the city's public safety and parking debt and $1.2 million being used to continue community justice services and pilot programs that were originally funded with temporary grants.
In order to begin the process of getting out of the deficit, city officials reviewed some of the options presented by Mayor Brown's cabinet. The mayor said these options are not final decisions and shouldn't be viewed as such.
The options are:
- Optional or mandatory furloughs: The city said these could be implemented to avoid layoffs within city departments. It's estimated these furloughs could save the city $1.8 million by the end of 2025.
- Foregoing the exempt cost of living adjustment: The cost of living is expected to go up between 2.5-4% in 2025. Some offices, like the mayor and city council, can't legally forego a cost of living adjustment because an independent citizen group determines how much people in those offices will receive. The city said it is currently reviewing salaries to make that change.
- Contract negotiation and consolidation: The city plans to pursue cost savings by consolidating contracts or renegotiating existing or renewed contracts. The city said it has an opportunity to consolidate contracts in departments that utilize the same software. The city said it could potentially save $230,000 in 2024 and $2.1 million in 2025.
- Sunsetting and suspension of positions: When positions are vacated, the city is able to determine if the position can remain vacant for an extended period or be eliminated altogether. The city said there are several departments that have identified temporary and permanent positions that could potentially be eliminated if operations are adjusted.
- Pursue new supplier for procurement: The city said it could use Amazon as an alternate supplier, which is rarely able to provide supplies and equipment at a lower cost.
- Complete an employee benefits audit: The city wants to begin routinely auditing the status of employees' dependents and beneficiaries to make sure they are eligible for coverage. The city said it had realized significant cost savings from doing this in the past.
To be clear, no official decisions have been made at this time.
To watch the full meeting, click here.
WATCH RELATED: EWU budget meeting sends staff into worry over potential cuts
DOWNLOAD THE KREM SMARTPHONE APP
DOWNLOAD FOR IPHONE HERE | DOWNLOAD FOR ANDROID HERE
HOW TO ADD THE KREM+ APP TO YOUR STREAMING DEVICE
ROKU: Add the channel from the ROKU store or by searching for KREM in the Channel Store.
Fire TV: Search for "KREM" to find the free app to add to your account. Another option for Fire TV is to have the app delivered directly to your Fire TV through Amazon.
Apple TV: Search "Spokane News from KREM" in the Apple store or follow this link.
To report a typo or grammatical error, please email webspokane@krem.com.