Woodward releases final proposed 2024 budget. Some remain skeptical it will solve long-term problems.

The Spokane mayor’s office has released a final proposal for the city’s $1.2 billion 2024 budget, revising some of the projections and plans the administration suggested last month it could use to fill an approximately $20 million hole in the general fund.

While the city operates with an approximately $1.2 billion annual budget, the $20 million hole that leaders need to fill is in the $234 million general fund. It holds the city’s most flexible dollars, which pay for, among other things, the police and fire departments. It is paid for primarily through sales, utility and property taxes.

The changes, which include lowering optimistic sales tax projections, dipping further into the Traffic Calming Fund to reestablish a dedicated traffic enforcement unit in the Spokane Police Department and pay other police expenses, and dedicating $500,000 to design a permanent fire station in the Latah Valley, comes after a month of negotiations with the City Council, which ultimately approves the city budget.

“This budget is the result of a lot of hard work and commitment by the organization to continue delivering services at the level the community expects,” Woodward said in a statement accompanying the budget proposal. “It represents an investment in our people, their commitment to providing services most efficiently and cost-effectively, community engagement, and collaboration with the City Council.”

Some on the City Council remain skeptical of the mayor’s plans, however, as does mayoral election challenger Lisa Brown, who has criticized Woodward’s management of city finances and blames the incumbent for creating the $20 million deficit in the first place. Woodward has argued that the city’s financial strain can be blamed on the pandemic, inflation, an economic slowdown and other external factors.

But Councilman Michael Cathcart, a frequent ally of Woodward’s who has nonetheless argued the administration has been slow to acknowledge the depth of the city’s financial woes, believes the proposed budget does not do enough to right the ship.

“I can see the writing on the wall,” he said. “We’re not getting to a sustainable budget this year. We have to at least start down that road, and none of that work has been done yet that I’ve seen.”

City Council President Lori Kinnear questioned whether it was appropriate to pay for police services by dipping into the dedicated traffic calming fund, which uses the revenue from red light and speeding camera tickets to build physical infrastructure such as speed bumps and roundabouts.

Woodward’s budget calls for pulling $2.8 million, up from $2 million as proposed a month ago, from the approximately $5.5 million annual fund, spending $1.4 million to stand up a dedicated traffic enforcement unit. The remaining $1.4 million would backfill various other police services, including security coverage at special events such as Bloomsday, city spokesman Brian Coddington said in a brief interview.

This redirection of funds would be needed for at least the next two years under the mayor’s plan. The administration projects that this new unit would generate an additional $700,000 per year through tickets.

Kinnear and others on the Council have said they would be willing to raid the traffic calming fund, but only if there was a clear, direct connection between that spending and traffic safety, such as by funding traffic enforcement. In addition, some, such as Councilmen Zack Zappone, have argued that the extra $700,000 in ticket revenue from the traffic unit, if it was created, should be put back into the traffic calming fund, not be used to fill holes in the general fund.

Cathcart bristled at the administration’s asks to pull increasingly large sums from the traffic calming fund, saying there was not consensus as to how a traffic unit would be launched and arguing against using an additional $1.4 million on other police services.

“My fear is this would just be used to cover overtime,” Cathcart said.

Brown has more broadly argued that no traffic calming funds should be used to backfill the police department budget, saying it breaks the trust of residents who have come to expect the funds to be used specifically for physical infrastructure.

“I had called for bringing back traffic officers, but not necessarily from the traffic calming fund,” Brown said. “Yes, people would like to see neighborhood traffic officers back, no doubt, but that’s not the same as the projects the traffic calming funds can pay for.”

Woodward, who has argued that traffic calming dollars have grown significantly and have become a “slush fund” for the city council, said that money was available to perform both functions.

“As council has continued to add more cameras in neighborhoods, that fund has continued to grow, and we can do both,” she said. “I think we can still do some of the neighborhood requests like roundabouts and speed bumps, but we’re at a level with that fund that we can also use it to fund traffic officers.”

Brown has also argued that the administration is delaying tough decisions by putting off internal debt payments through refinancing. The budget proposal does state that these would be one-time savings, and Coddington acknowledged they could entail larger long-term costs. Unlike typical loans, however, the city’s internal debt can be paid off early without penalty, Coddington said, meaning that there is relatively little disadvantage to delaying payments if economic conditions improve later.

Brown has also been highly critical of the city-run Trent Resource and Assistance Center, a roughly 350-bed homeless shelter and a major strain on city finances. She argues that the Woodward administration has used one-time COVID-relief funds from the federal government to cover the ongoing expenses to operate the shelter, which is currently only funded through next summer.

Woodward argued that the city’s homeless services are always funded by one-time funds, such as grants from the state or federal governments, but agreed that the current funding source for the Trent Avenue shelter was not sustainable. The city hoped to get additional state funds next year to keep the shelter open at least through the end of next year, she added.

“I wish there was more sustainable funding for these types of facilities as we address homelessness,” Woodward said.

Woodward also argued that her administration had been forced into opening the Trent facility by court decisions and City Council ordinances that forbid enforcement of homelessness camping laws if shelter beds aren’t available, and that make it onerous to wind down shelter space once it has been created.

The mayor’s proposed budget also continues a hiring freeze announced earlier this year for positions that don’t directly increase revenues or decrease costs.

“There will be tighter scrutiny on hiring for open positions,” Coddington said. “We’ll evaluate if positions are still needed or if the job description is right, and this just means there’s added scrutiny on whether a position is needed or not right now.”

Zappone questioned whether continuing to keep positions open, as opposed to either cutting them permanently or recommending new revenue to bring them back, was avoiding addressing the long-term problem of unsustainable staffing costs.

“The hiring freeze does not actually solve the budget gap,” he said. “It’s a permanent gap – are we permanently pausing that hiring? That’s eliminating positions. We can’t bring them back because there’s no additional revenue, unless we go to voters and ask for a tax increase.”

The mayor’s proposed 2024 budget does largely freeze overall growth in spending next year, increasing only 0.2% over the 2023 budget, which itself increased 5.6% compared to 2022.

Over half, or 55%, of the proposed general fund budget would go to the police and fire departments.

The mayor has proposed cutting 19 positions in the fire department. Those cut firefighter positions come from the “fire relief pool,” city spokesman Brian Coddington said last month when the cuts were called for in the mayor’s preliminary budget. Those are positions working each shift beyond minimum staffing requirements, typically backfilling a spot left vacant by a firefighter on sick or holiday leave. A recent study suggested the positions could be cut without the city dropping below minimum standards of service, Coddington added at the time.

The Spokane Police Department is by far the largest single expense in the city’s $243 million general fund, with the mayor proposing spending $85 million on police next year, up from $73 million in 2023.

Kinnear wondered whether that budget increase was appropriate, noting the belt tightening currently taking place in other city departments and that the City Council office’s budget was cut last year.

“I want to make sure we’re being prudent and not asking for a Cadillac when a Chevy would do,” she said.