Spokane County Commission reverses course on property tax vote

Spokane County voters won’t be asked whether they want to raise property taxes this year.

County Commissioners Al French and Josh Kerns voted Tuesday to rescind a tax proposal, a month after they, along with then-Commissioner Shelly O’Quinn, voted to put it on the November ballot.

Without additional tax revenue, the county will need to cut services, and possibly staff, to fix its $10 million budget shortfall, officials said.

French and Kerns said they had second thoughts about the ballot measure after realizing the impact of the state’s operating budget, which includes a large increase in funding for public schools as mandated by the state Supreme Court’s McCleary decision.

According to the county’s analysis, the state’s plan will raise property taxes by up to 90 cents per $1,000 of assessed property value in local school districts next year. The county proposal would have added up to 25 cents per $1,000 on top of that.

“Because of the significant tax increase that our voters, our taxpayers, are going to be confronted with in 2018, we did not feel comfortable, as a board, going to the voters and asking them whether they wanted to impose more taxes on themselves to be able to fund county government,” French said.

The commissioners, along with Sheriff Ozzie Knezovich and other county leaders, joined Spokane City Councilwoman Candace Mumm and City Administrator Theresa Sanders at a news conference outside the county courthouse Tuesday afternoon.

They said the two governments would work together during the next few months to streamline county services, but it remains to be seen how they will do so.

French said the solution may involve a combination of budget cuts and tax revenue that would typically be used to pay for roads. He said he hopes to avoid dipping into reserves, which could hurt the county’s bond rating.

“Right now we have the highest bond rating a county of our size can secure,” he said. “And we want to protect that.”

City and county leaders said the criminal justice system, which accounts for roughly three-quarters of the county’s expenses, is a likely target for budget cuts.

“I think there’s some savings to be had on smart justice reforms,” City Council President Ben Stuckart said.

Stuckart said he’s been in talks with the county for weeks and looks forward to collaborating on a budget solution.

Knezovich, meanwhile, expressed concern about the fate of his department.

“From 2008 to 2010, we lost 34 deputy positions,” he said. “Those positions have never come back. With the $1.3 million cut that we’re facing right now, it’s another eight to 15 deputies that could be lost during this next go-around.”

French said “quality of life” services, such as park maintenance and the county’s Conservation Futures program, may also face cuts.

French said the deficit is the culmination of many factors, including “unfunded mandates” from the Legislature and the state Supreme Court. The so-called Hirst water rights decision, for example, has cost the county nearly $500,000, he said. And tax revenue hasn’t kept pace with inflation, he said, because of a state law that caps tax increases at 1 percent per year.

“Quite frankly, the funding model for county government in the state is broke,” French said. “It leaves counties constantly struggling to solve a structural gap that’s created and exacerbated every year. Our expenses grow at a rate greater than 1 percent, expenses that we can’t control.”

He said the county likely will place another tax measure on the 2018 ballot because “the problem won’t go away.” But by that time, the state’s tax levy for schools will have decreased significantly, he said.

The Spokane County Republican Party recently nominated three people to fill O’Quinn’s vacant commission seat. She resigned last month to lead the Inland Northwest Community Foundation.

French and Kerns were expected to interview the three nominees Wednesday. Later, they’ll choose a new colleague from the GOP’s short list, which includes Rob Chase, the county’s elected treasurer; Mary Kuney, the county’s chief deputy auditor; and John Guarisco, an executive at a Spokane Valley marketing firm.

County officials plan to host six public forums and presentations before the commissioners vote on the 2018 budget in early December. Last year, the commissioners held only one sparsely attended public hearing and approved the annual budget immediately afterward.

“We want to make sure that the public fully understands and appreciates what we’re doing to try and be good stewards of their taxpayer dollars, and that means transparency, transparency, transparency,” French said.

Knezovich urged taxpayers to attend the meetings and provide feedback.

“Ladies and gentlemen,” he said, “it’s time for your voice to be heard.”