Kenmore City Hall. Courtesy photo

Kenmore City Hall. Courtesy photo

Kenmore City Council adopts budget, with 3 percent property tax increase

The city is using banked capacity to fund programs and keep up with inflation.

The Kenmore City Council passed its 2019-20 biennial budget with a 5-1 vote on Nov. 19, following a 4-2 vote on the 2019 property tax levy.

Councilmember Brent Smith voted against both, with Councilmember Joe Marshall joining him on the tax vote. Mayor David Baker was absent and excused from the meeting.

Smith said he thinks the city still has areas where it could have trimmed costs. Deputy Mayor Nigel Herbig said this budget was the most difficult one he’d worked through.

“Nobody ever gets everything they want out of the budget, but I think we have a document that moves the city forward and keeps us on the right path,” Herbig said.

The council has been discussing the budget since Oct. 15, and held public hearings on Nov. 5 and Nov. 13 on the 2019 proposed property tax levy.

“Each year, the City of Kenmore must establish the amount of property tax revenue needed to fund our budget. Property taxes pay for basic city services such as police, jail, and parks,” according to a city press release.

Costs of providing city services go up each year, even with no increase in the level of service, the release stated. The Consumer Price Index for the Seattle area has exceeded 3 percent this year. To keep pace with rising costs, City Manager Rob Karlinsey proposed a 3 percent property tax increase in each of the biennial budget years (2019-20).

By state law, the city can only increase its general levy by 1 percent, but because the Kenmore City Council did not raise the levy by the allowable 1 percent for many years, the city has “banked capacity” and is able to now propose the 3 percent increase.

Washington has a budget-based system of property taxation. Kenmore establishes its desired levy amount (i.e., the total, city-wide property tax revenue) within the limitations in state law. After receiving the desired levy from the city, the county calculates what the actual levy rate needs to be after considering property values.

Kenmore’s property tax levy amount in 2018 was $4,837,631. Staff recommended the 2019 tax levy be raised to $5,024,414, which represents that 3 percent increase, plus a small amount of new property tax generated from new construction.

Because of rising home values, the resulting levy rate would actually decline from last year with this proposal, from $1.13 in 2018 to about $1.04 in 2019 (per each $1,000 of assessed value).

Owners of a $600,000 home would pay $612 annually to the city with the 1 percent increase, and $624 annually with the 3 percent increase.

Kenmore residents pay about 12 percent of their total property tax bill to the city. They also pay taxes to the school district, county, state and other taxing districts.

Another part of the city budget includes the surface water utility fund. This fund pays for handling rainwater runoff, flood control and improving the water quality and wildlife habitat of rivers and streams.

New state requirements and standards to improve water quality have resulted in higher surface water management costs and Karlinsey also recommended rate increases for this fund. The city has not increased surface water utility rates since 2012.

See www.kenmorewa.gov for more.

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