2024 Preliminary Budget

To the citizens of Enumclaw and Enumclaw City Council Members,

When the calendar turned to July 3rd city department heads turned to the 2024 budget. Each year the needs of the community through our city departments must be determined and calculated to provide the quality services our Mission Statement expresses. That is “effective and in a responsible manner to our community.”

Over the last two years the city’s budget has been able to utilize funds provided through the ARPA program. This year we will be looking through the lens of a post-ARPA budget. With the guidance of city council, the use of these federal dollars was in my opinion, wisely spent throughout the community and budget. How this will affect services in the coming years will not be known until we come to analyzing those yearly budgets. For the 2024 budget it has had a little affect on department expenditures, whether in normal expense outlays or in Full Time Employees.

This year’s budget started with caution and continues with surprises. Sales tax revenue continues to exceed the budget. What is not determined is how much of the sales tax increase is related to a natural increase or to inflationary increases due to retail stores raising prices. Probably both have influenced the increase. What has also increased due to inflationary pressures are the city’s expenditures. And this is where our challenge lies.

As a city and a council, we need to balance each year’s budget. Whether it is through revenue increases or expenditure decreases. Administration and Finance have gone through this year’s budget in several reviews and the “low hanging fruit” has been cut. Some significant decisions will need to be discussed to bring the next budget into balance. Will there be some pain in the coming months, hopefully not. Where it will land will need to be determined, but with the deficit the city is facing will require some extensive reviews that no one envisioned just a year ago.

The main drivers of these increases in expenditures are in the wages and benefits. Approximately 8% for each expenditure. When a significant portion of the city’s budget is in these two-line items, 8% can add up to large dollar amounts for the year.

Some potential headwinds that may or may not affect future revenues for the city’s budget could be the economy slowing down. If families feel the need to be more selective in their spending and where they spend their dollars we may see sales tax dollars reduced. Another potential reduction could be the recent strike by the UAW at various car plants at each of the three auto manufacturers. Potentially this can result in
 

inventory issues for new vehicles, which would affect car sales in our community. If car sales are reduced, sales tax revenue will be less. How long the strike will last, how quickly the car manufacturing plants gear back up to produce inventory and how fast the inventory can get back into the supply stream.

With this said it is now time to work on the budget and determine how best, we as a council, can devise a plan to minimize the effects for 2024, which may affect 2025.

Mayor Jan Molinaro