An Update on Newcastle's Fiscal Sustainability
Posted on 10/10/2019

Fiscal sustainability will figure prominently in City Council budget discussions this year as the Council considers how to face a projected shortfall of over $1 million in the 2020 budget. Councilmembers must take action to reduce both next year’s deficit and growing deficits in future years.

A third-party review of the City’s financial situation and subsequent report containing strategies for ensuring financial stability provides objective data the Council needs to move forward. How the City proceeds is still under consideration.

“Our biggest expense that continues to increase is the cost of providing police and fire protection. These are essential services for a safe community,” said City Manager Rob Wyman. “We are fortunate to have a number of options to continue to provide the quality of life our residents expect.”

Those options are detailed in the financial analysis and include expenditure controls, service-level reductions, cost shifts, revenue enhancements and new revenue streams. Recently, the City has received several questions and concerns about one possible strategy: a utility tax. The City of Newcastle does not currently have a utility tax and the City Council has not proposed one.

“Public input is a big part of everything we do at the City of Newcastle and is particularly critical during our budget process. We started out our process with a Town Hall meeting about fiscal sustainability, and we encourage ongoing public participation,” Mr. Wyman said. “These decisions impact the lives of our residents, and we are listening.”

The City Council will likely rely on a suite of solutions to fix the projected operating budget deficit. The Council already tackled one cost-cutting measure during the October budget retreat, approving a move to consolidate the roles of two employees into one position. The roles of the Community Activities Coordinator and the contracted Communications Coordinator were combined in an effort to cut staff costs.

If the City Council decides to implement a utility tax, they’d have control over which utilities are taxed and at what percentages. Additionally, utility taxes are enacted upon utility organizations, many of which have rate relief programs for those on fixed incomes.

The Newcastle City Council’s work to adopt the 2020 budget kicks in to high gear this October and citizens are encouraged to get involved. The City Council will hold budget public hearings on Oct. 15 and Nov. 5. Staff will present the preliminary budget on Oct. 15, and from there, the Council will review, discuss and perfect it over the next month.

The City of Newcastle is committed to keeping residents informed. The webpage newcastlewa.gov/budget2020 is your news source for all-things 2020 budget. Check back regularly for relevant meeting agendas, meeting audio, written recaps and other materials.

The Newcastle City Council wants to hear from you! Members of the public are invited to share thoughts during public hearings or two open public comment periods at meetings. Regular meetings of the City Council occur on the first and third Tuesdays of each month at City Hall, starting at 7 p.m. You can also email your thoughts to Councilmembers. To send a message to the entire Council, email citycouncil@newcastlewa.gov.

 

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