Though still without plan to pay for more cops, Spokane Valley City Council poised to opt against property tax increase for 16th straight year

For the 16th year in a row, Spokane Valley residents likely won’t pay more property taxes next year.

Though the city’s leaders have struggled to determine how to fund their goals to boost the Valley’s police force, council members have prioritized their longtime goal of maintaining low taxes.

The Spokane Valley City Council voted Tuesday to advance an ordinance that would forego  the 1% tax increase allowed by state law . A final vote on the matter will take place Oct. 22. 

Councilman Rod Higgins voiced the lone vote in favor of taking the increase, saying he felt it irresponsible given the thin margin between the city’s expected recurring revenue and expenditures next year. He cited figures shared by city staff in an August budget discussion that estimate the city’s general fund revenues will outpace expenditures by only $2,000.

“I think it’s a false saving to not go ahead and take that,” Higgins said. “We’re fooling ourselves.”

By abstaining from a 1% tax increase, the council is saving the typical Valley homeowner less than $5, while missing out on an additional $138,060 in revenue next year. The levy rate will remain at 79 cents per $1,000 of assessed value.

The council has yet to adopt a final 2025 budget but expects to do so in November. One of the challenges the city will need to contend with is a forecast 6.4% increase year to year in recurring expenditures, according to city records. Revenue will only increase by an estimated 1.2%.

Stagnating sales tax revenue across the state also has several local governments grappling with how to match pace with rising costs. The Spokane County Commission, for example, started its budgeting process by asking departments to identify cost saving measures, like potential cuts to vacant positions, in light of the stagnating sales tax revenue.

Spokane Valley staff expects new construction to lead to an increase in property tax proceeds, despite not taking the allotted increase, Finance Director Chelsie Taylor said. The city expects to collect $13.8 million this year, and around $14.1 million in 2025.

Decision rules out potential public safety funding source

State law allows local governments to raise property tax collections by up to 1% each year without asking voters. Governments that opt against raising taxes don’t lose that ability to start collecting those taxes in the future.

Having declined to raise taxes for 16 years in a row, the Spokane Valley City Council could raise taxes significantly more than 1% without a vote of the people.

Taking the allotted tax increase, as well as the city’s “banked capacity” from opting against it in years past, was floated earlier this year as a potential funding source for the city’s ongoing efforts to bolster the Spokane Valley Police Department.

Doing so would have allowed the city to raise the city’s taxes by $1.2 million, bringing the rate to 86 cents per $1,000 of assessed value. The rate based on the increased capacity would have meant a $30 increase in property taxes for the average Valley homeowner.

The council elected to divert funding away from its road maintenance fund to hire 10 new deputies and a civilian analyst in a February meeting, but has yet to identify funding to fill all of the more than two dozen deputies called for in a consultant’s report last year.

Councilman Al Merkel, who voted against the increase, criticized his fellow council members for what he views as a lack of movement to fund, recruit and fill the remaining positions.

The comment led to another terse exchange with his fellow council members that highlighted the division that’s plagued the council all year.

As budget discussions have continued for the past few months, Merkel has advocated for putting a larger chunk of the city’s annual budget toward that effort by making cuts to other city services, projects and staff salaries.

He said the city has not funded law enforcement to “the appropriate level” in years past, which led to the shortfall in deputies on shift identified by the consultant’s report last fall.

The council spends $35 million each year on public safety, which pencils out to about 64% of the city’s annual expenditures. Councilwoman Jessica Yaeger cited that proportion when countering Merkel’s claims.

“I want to make sure that it’s very clear that never once has anyone on this council, except for Merkel and his roundabout way of misusing the truth, moved to defund the police,” Yaeger said. “The city of Spokane Valley City Council is highly backing our police officers and our public safety, and anything against it is false.”

City Manager John Hohman said there are challenges outside of the council and city’s control in meeting the consultant’s recommendations, which will take time to navigate and plan. Hohman, Mayor Pam Haley and Deputy Mayor Tim Hattenburg pointed to the challenges in recruitment that have plagued the Spokane County Sheriff’s Office and other law enforcement agencies nationwide in recent years.

“You don’t do it overnight,” Hattenburg said. “You don’t just say, ‘Hey, let’s get 30 by next week.’ It doesn’t work that way. That is not how the process works. We don’t have the finances. The police or the sheriff do not have the means to hire 30 people when they are not available. They’re doing the best they can.”

Higgins added that the council hasn’t filled the 10 positions it approved in February, while taking a jab at Merkel for not understanding “10 comes before 30” as someone with a bachelor’s degree in mathematics from Whitworth University.

“If you can’t hire 10, you’re not going to get to 30,” Higgins said. “So what are we arguing about here?”

The Sheriff’s Office has had between 20 and 40 vacancies over the past few years due to retirements and an increase in positions funded by the county. The agency also has cited what it views as poor public perception of law enforcement driving would-be deputies away from pursuing careers in the field.

Sheriff’s Office spokesman Cpl. Mark Gregory said the office’s recruitment efforts seem to be on the up, noting the department swore in three new members Monday. One is a new hire, while the other two transferred from other agencies, meaning there will be a shortened timeline for them to go from new hire to boots on the ground.

Gregory said he could not specify if the hires will head to the Valley precinct, as it depends on staffing needs across the county and when those hires will be done with their necessary training.

Hohman said city staff members are actively working to reach the city’s public safety goals, including coordinating with the Sheriff’s Office on recruitment efforts and identifying potential funding opportunities like grants.

“I would not categorize this council or staff as not making progress on public safety,” Hohman said.

“I think I’ve explained many times tonight that we are and it’s a challenge, but it’s one that we’re up to. And we will solve that issue.”

Editor’s note: This article has been updated to correctly reflect the action taken by the Spokane Valley City Council during their meeting on Oct. 8.