PORT TOWNSEND — City Council members were presented with the preliminary 2020 budget and passed the first reading of a series of finance-related ordinances.
Port Townsend’s second city manager in 20 years was sworn in Monday as city officials prepared to adopt next year’s property tax levy rates and supplemental appropriations for the 2019 budget.
Council members approved the first reading of a six-year capital improvement plan, and they discussed at length a proposal to replace a leaky off-shore outfall pipe at North Beach.
Mayor Deborah Stinson welcomed City Manager John Mauro, who recited the oath of office as presented by City Clerk Joanna Sanders.
Mauro, who began his tenure Friday, replaced David Timmons, the city’s only other manager who retired after 20 years of service in June.
“It’s nice to have you officially with us,” Stinson said.
She also thanked Nora Mitchell, the city’s finance and administrative services director, who filled in this summer as the interim city manager.
The city’s preliminary $35 million budget, which will come back to the council Nov. 18, has a surplus of about $238,000 and is projected to have a slight increase in end fund balance at about $12.2 million.
Part of the revenue will come from a 1 percent increase in the regular property tax levy plus new construction, the combination of which will bring in about $3.5 million. The increase over 2019 property tax is $34,370, according to city documents.
The city will remove $908,000 that had been assigned to pay for fire services after voters approved the annexation into East Jefferson Fire-Rescue territory in February.
The total levy amount, including library and Mountain View responsibilities, is projected to be $2,764,000, city documents stated.
A 13 percent rise in the real estate market will reduce the levy rate, Mitchell said.
“The combined three levies will be at a rate of $1.47 [per $1,000 of assessed property value], and that compares to $3.08 previously,” she said.
The city has seen its housing market and retail sales continue at pre-2019 levels, but commercial and government construction has declined, Mitchell said.
“We’re building off the strengths of the last few years, but we’re not necessarily seeing the same growth,” she said.
“There are some signs of slowing, especially in the construction industry and retail sales.”
Utility tax revenues in the proposed budget are based on a 22 percent increase on gross receipts for water, sewer, stormwater and garbage services.
That was projected to drop to 20 percent at the end of 2018, but the city renewed the tax for an additional five years, and the difference currently funds two maintenance workers who serve parks and the Mountain View Commons, city documents stated.
On the expense side, 38.5 percent of operating costs will go to wages and benefits.
The city agreed in January on a three-year contract with its general collective bargaining unit, moving a 2 percent scheduled wage increase in 2019 to a 4 percent increase approved with the supplemental budget. It also accounts for bumps of 3 percent in 2020 and 2 percent in 2021, according to city documents.
Mitchell said the city tries to keep a similar schedule for non-represented employees.
Minimum wage increases to $13.50 per hour from $12 on Jan. 1, and while Mitchell said that doesn’t directly affect the city much, it has a longer-term effect.
“We have a minimal number of jobs impacted by that, at least initially, but it creates some wage compression,” she said.
“Some of our other levels of more skilled labor are not being adequately addressed. That’s probably something we need to look at in the next year or two.”
New items proposed in the 2020 budget include a new police vehicle for $70,000, an increase of $20,000 in the library fund for consulting services for strategic plan development, and a new front loader tractor for the wastewater and biosolids departments for $240,000.
Capital projects include completing ADA-compliant ramps through a 2017 Transportation Improvement Board grant, the design and partial construction funding for Seventh Street, and Discovery Road upgrades that are mostly funded with grants from the state Department of Transportation.
Mitchell said a few of the 2020 goals include completing negotiations with the Port Townsend Paper Co. to replace a contract on water usage that expires in March, continue the city’s role as a facilitator for affordable housing, and to complete the parks, recreation and open space plan in the first quarter of the year.
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Jefferson County Managing Editor Brian McLean can be reached at 360-385-2335, ext. 6, or at bmclean@peninsuladailynews.com.
