Poor Economy & No Money

We began the year with a clear understanding that the economy would dominate the session and success would be defined by retaining existing resources. Five months later with adjournment of the Legislature and action by the Governor complete, we have mixed results.
 
We held onto and even grew some of our most critical operating funds:

Full mitigation for streamlined sales tax
$65 million was allocated to fully mitigate the revenue redistribution as a result of streamlined sales tax.

An additional $10 million for the City-County Assistance Account
The real estate excise tax that funds this account has fallen significantly. We secured an additional $10 million to this account to assist small and low tax-base cities and counties.

Public Health Funding
Funding was provided at $80 million – only $4 million below last biennium.

Continuation of Important State Revenues
The criminal justice assistance account and liquor excise tax account were funded at levels similar to last biennium. An additional $18.7 million will be distributed to local governments through the liquor revolving account.

Local sales and use tax associated with large annexations (ESSB 5321)

ESSB 5321 extended and modified the existing sales and use tax credit for cities in King, Snohomish and Pierce counties annexing large areas. The bill extended the credit to 2015 and adds Seattle as an eligible jurisdiction.

We also secured some new tools:

Annexation reform (ESSB 5808)

This bill added a new optional interlocal method of annexation and established for every city and town using the property-owner petition method the need to secure agreement from owners of at least 60% of the assessed valuation, down from 75% for some cities.

Community revitalization financing (2SSB 5045)

Local governments including cities, counties, and port districts, may create “revitalization areas” and use certain tax revenues which increase within the area to finance local public improvements.

We lost:

Public Works Trust Fund Resources
The Legislature moved $368 million from the Public Works Trust Fund to the State operating budget. They did allocate nearly $10 million for a new small community jobs grant program and an identical amount for a new urban vitality grant program. Both programs will be administered by the Public Works Trust Fund Board.

See the following article for more details on these allocations and other State budget allocations important to cities.

It was a tough year and we don’t expect 2010 to be any easier. AWC’s Legislative Committee will review our 2009-10 agenda and make recommendations to the Board for modifications given action this year and new critical issues.

Please watch for an initial outline of our 2010 legislative priorities in late September. We will need your help and work over the fall reminding legislators of city needs.
Please contact Jim Justin of the AWC staff if you have any questions on any legislative issues.

Thanks for your help this year!

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