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Home My WebLink About_10-03-25_Council Retreat_Packet 8:00 Coffee City Council Budget Retreat Friday, October 3, 2025 at 8:00 a.m. City Council Chambers – 110 E 3rd Street 8:30 Overview Review agenda 8:45 Budget amendments 2025- 2026 9:45 Break 10:00 Budget update 11:00 Fire sprinkler demonstration 12:00 Lunch 12:30 Budget updates (continued) 2:00 Additional discussion items 3:00 Adjourn SPECIAL ACCOMMODATIONS: The City of Arlington strives to provide accessible meetings for people with disabilities. Please contact the ADA coordinator at (360) 403-3441 or 711 (TDD only) prior to the meeting date if special accommodation is required. 2025-2026 Budget OCTOBER 3, 2025 1 2 3 4 5 2025/2026 Strategic Priorities •Public Safety •Fiscal Sustainability •Economic Development 6 7 30% 5% 13% 48% 4% 2025 REVENUES BY FUND TYPE $83 MILLION General Funds Special Purpose Capital Project Enterprise M&O 8 28% 6% 15% 48% 3% 2025 EXPENSES BY FUND TYPE $94.5 MILLION General Funds Special Purpose Capital Project Enterprise M&O Public Safety Investment TOTAL COST: $1,560,000 Early hire in 2024 for budgeted patrol position in 2025 (complete) Purchase of additional vehicle for early hire (complete) Added a sergeant position (complete) Added an administrative assistant position (2026) Added officer position for 2026 (on hold) New and increased technologies •Intersection cameras – complete •Report writing software – not complete •Body cameras – complete •Digital forensic software – complete 9 Funded by property tax banked capacity taken in 2024 Public Safety Investment (Continued) TOTAL COST: $4,914,000 Continuation of Transportation Benefit District Fund (transportation sales tax) •Neighborhood traffic calming (on going) •Pavement preservation (on going) •Safety projects as identified in transportation improvement plans •74th Avenue Trail pavement (complete in 2025) •Burn Road rehabilitation (seeking funding) •211th Place Project (complete in 2025) •180th Street and 188th Street/Smokey Point Blvd Roundabouts (construction fall 2025 to fall 2026) •Division/Broadway Street Project (mostly complete 2025) •Sidewalk Program (on going) 10 Projects funded by transportation sales tax. Voters passed ballot measure in 2023 extending the tax another 10 years. Grants funded portions of 74th Avenue Trail, Division/Broadway project, and 180th and 188th Street roundabouts. Fiscal Sustainability TOTAL COST:$585,000 Update 10-year financial plan (on-going) Update financial policies (complete) Succession planning for Finance and CED departments •Includes overlap for retiring positions (complete) •Includes 3 new full-time employees ( 2 on hold) •Hired one permit tech in 2025, planner for 2025/2026, inspector position on hold 11 Funded by sales tax, utility taxes and permit revenue. Economic Development – CED TOTAL COST: $220,000 Comprehensive Plan (complete) Island Crossing Sub-area Plan (in-process, complete 2025) 12 Funded by program development reserve. Economic Development – Water TOTAL COST: $22,000,000 Annual water main replacements Water Treatment Plant expansion Water Treatment Plant filter pre-purchase Island Crossing water main (pending funding) 211th Place improvements (complete) 180th Street and 188th Street roundabouts- water portion (2025/2026) Reservoir property purchase (2026) 13 Funded by grants and PWTF loan (applied for), water connection fees and accumulated reserves. Economic Development – Sewer TOTAL COST: $6,600,000 Annual sewer main replacements Lift station upgrades (2026) 211th Place improvements (complete) 180th Street and 188th Street roundabouts- sewer portion (2025 2026) 14 Funded by sewer connection fees and accumulated reserves, searching for funding for other projects. Economic Development – Stormwater TOTAL COST: $720,000 Stormwater system repair maintenance (on going) Prairie Creek Culvert (2026) 15 Applied for a federal grant for the Prairie Creek Project, other projects are funded by accumulated reserves. Economic Development – Airport TOTAL COST: $10, 466,000 Taxiway Alpha overlay (complete) Taxiway C extension (canceled FAA funding) Runway 11-29 solar lighting (canceled FAA funding) Master Plan (in progress) Fencing replacement (on-going) Fiber project (on-going) 16 Funded by FAA and WSDOT grants (expected $4.7 million) and accumulated reserves. Economic Development – Transportation TOTAL COST: $16,000,000 Island Crossing Roundabout (grant application pending) 169th Street Segment (in design, construction 2026) 180th Street/Smokey Point Blvd Roundabout (construction 2026) 188th Street /Smokey Point Blvd Roundabout (project to start fall 2025, complete 2026) SR 531 Trail (not funded) 17 Funded by grants (applying for), traffic mitigation, REET funds and accumulated reserves. 169th Street Connector Project 18 180th Street and Smokey Pt. Blvd. Roundabout 19 188th Street and Smokey Pt. Blvd.Roundabout 20 Other Capital Projects TOTAL COST: $3,900,000 Dog park at York Park (complete 2025) Bike Pump Track (in process for design and funding) Design commercial kitchen facility (in process – request for qualifications) Police Impound facility (2026) Upgrades to Maintenance & Operations facility (2025) City hall roof and window replacements (complete) Continuation of fiber program (on-going) 21 Funded by program development reserves, grants, remaining bond proceeds, construction sales tax. Financial Assumptions 22 General Fund Revenue Budget 23 TAXES 76% 2% INTERGOVERNMENTAL 5% 8% 0% MISCELLANEOUS TRANSFERS 7% 2025 Budget and Actual Expenses 24 General Fund Expenses Budget 25 Legislative 1%Administration 8% Finance Dept 7% Legal Services Personnel 1% Operating Transfers 12% Information Technology 4% Police 46% 4% Comm & Econ Develop. 11% Debt 5% General Fund Expenditures by Department 26 General Fund Revenue Assumptions •Property taxes – 1% plus new construction each year. •Sales tax – 4.5% increase from 2023 actuals, excluding construction revenue from Amazon facility. •Other tax revenues increased/decreased based on trends and/or anticipating increase in commercial and residential populations. •State shared revenues. •NCRFA – payments will be $277,985 per year until 2039 for debt on fire station 48, also added about $24,000 for reimbursement for insurance premiums on stations 46 and 48. 27 General Fund Expense Assumptions •Police: added positions – 2025: Sergeant (promotion in 2025), Administrative Assistant (2026). 2026: Patrol Officer (on hold). •APOA contract through 2024. Negotiations start June 2026. •Police: expected cost increases for: prosecution, public defense, domestic violence coordinator contract, dispatch assessment and jail costs. Increased contribution to equipment replacement to accommodate take home care program (take home car program increased vehicle fleet). •IT contributions for all departments/funds increased substantially due to new software (Smartsheet, eskills, Laserfiche...etc.), keeping up with security and network functionality and general cost increases. •Legal services – increased because of expected retirement and replacement of city attorney. •2014 bond refinance will result in interest savings, not yet reflected in the budget. (complete) •Adding one maintenance position in 2026. (on hold) •Non-rep compensation approved through the budget process, aligns with compensation survey and staying current with CPI.(on-going) •AFSCME contract through 2025, negotiations began July 2025. 28 General Fund Reserves •General fund 2-month reserve compliant. •Full compliance with mandatory reserve. 29 Other Budget Assumptions •Opioid fund balance approximately $400,000, 2026 Imbedded Social Worker Program. •Increased funding for sidewalk program, paid for by REET. •Reduction of contribution to public art fund to $25,000 in 2026 (paid for by construction sales tax). •Reduction of contribution to capital facility fund this biennium. Fund balance sufficient to covered obligated projects. Will resume contribution to full levels once construction sales tax revenue picks back up. •Lodging tax grant program $175,000 for 2025 (grants already awarded), $185,000 for 2026 is approved. 30 Fund Closures Fund 007 – ARPA fund Fund 004 – Program Development Fund 306 – Bond Proceeds Fund (open pending Police Impound facility) 31 Next Steps Council Workshop •Re-cap of 2025/2026 preliminary budget •Review proposed 2025 general property tax October 28 Council Meeting •Public hearing on proposed 2025 general property tax levy •Public hearing on proposed 2025/2026 budget (Could adopt levy resolution and budget ordinance this date) November 4 Council Meeting •Adopt resolutions setting the 2025 regular property tax levy •Adopt 2025/2026 Budget Ordinance November 18 Council Workshop •Review 2024 budget amendments December 9 Council Meeting •Public hearing on proposed budget amendments •Adopt Ordinance for 2024 budget amendments December 16 32 Questions 33 34