Edmonds Beacon - Your Hometown News Source

City remains optimistic about its finances

 
Series: Coronavirus | Story 186

Last updated 5/21/2020 at 9:31am

As reported in last week's Beacon, the City is projecting COVID-19 will cause a 9.2% decline in operating revenue in its general fund.

At Tuesday's council meeting, Assistant Finance Director Dave Turley said this decline amounts to a $4 million loss in revenue out of a revenue budget of $43.8 million. It's a difficult task to make up for a loss in revenue of this magnitude in the remaining seven months of the budget year, he said, but the City is moving forward with a two-phased approach.

First, by suspending new hires and nonessential expenditures (operational and capital) to preserve essential City services, such as public safety and maintaining basic transportation and city building infrastructure.

Second, by continuing to monitor the City's budget situation in conjunction with incoming revenues and economic indicators.

Turley said the City entered this crisis in a strong financial position, giving it time to chart a course of action to minimize service impacts to the community.

"We examined our budgets and identified $1.3 million of nonessential expenditures that can be delayed and an additional $271,000 in savings from suspending new hires," he said. "While the reductions in nonessential expenditures and savings from the hiring freezes help us balance the budget, we may need to access our reserves to help make up the difference.

"We have also cut the budget in other areas, including training, supplies, and holding several projects from moving forward until we better understand the financial impacts COVID-19 will have on the City."

Turley added other cities in the Puget Sound area have made layoffs and furloughs.

"Those are pretty extreme measures," he said, adding that some were significantly lower than 20% of reserves, which is best practice. "I feel very happy to work in Edmonds, where hopefully we can avoid some of those more drastic measures."

 

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