September 26, 2024
City Council and Residents of Newcastle:
It is my honor to present to you the 2025 Preliminary Budget for the City of Newcastle. The budget uses a prudent and conservative revenue forecast combined with a lean approach to expenditures that is consistent with the City’s adopted financial policies and State law. The budget serves as a guide to the City's operations and capital programs for 2025. It includes a six-year forecast of expenditures through 2030. The six-year forecast helps guide budget and service level decisions. The 2025 budget holds the line on service levels while keeping overall operating costs low. The 2025 budget does not include any new services.
The 2025 budget includes funding for 12 officers through the King County Sheriff's Office. Due to the staffing shortages at the Sheriff's Office, the City currently has 10 officers. It is anticipated that these staffing shortages will be filled by year-end 2025, and possibly much earlier in the year. Short-term public safety cost increases continue to represent the most significant budget challenge for 2025 and beyond. Increased costs for both Police (7% increase in 2025) and Fire (4.98% increase for 2025) services continue to squeeze the City's General Fund operations. That said, public safety continues to be a top concern for Newcastle residents. The 2025 budget also allocates funds towards establishing a Police Explorer Program ($12,500) and continues to fund the City's license plate reader (LPRs) cameras that were recently installed ($19,000). Per the City's plan for use of pandemic relief funds, the 2025 budget proposes to use approximately $695,000 of Cumulative Reserve Fund money to fund the cost increase for the City's police and fire services contracts, the 12th police officer, and the LPRs.
The 2025 budget includes $200,000 in new revenue based on the City Council's intention to implement an Admissions Tax. With the Admissions Tax, the 2025 General Fund is balanced, with a surplus of over $64,000. As indicated above, this is largely due to the use of pandemic relief funds to help fund public safety cost increases. As was the case for the 2024 budget, the 2025 budget includes a reduction in general government costs (General Fund costs other than public safety and parks maintenance). This is reduced from the 2024 Adopted Budget by approximately $56,000. Another significant part of reducing general government spending is that additional staffing reductions are proposed for 2025. Two full-time positions have been left open for nearly all of 2024. The first is the Senior Planner position, which is proposed to be reduced to a part-time Administrative Assistant position. The other is the Office Support Specialist position, which is proposed to be reduced to part-time and adjusted to specifically support the Public Works Department, which takes much of the cost of the position out of the General Fund. It is also proposed that the Events and Recreation Coordinator position be increased from a .6 FTE (24 hours per week) to a .8 FTE (32 hours per week) as this position has taken on the City's main communications functions as well. This is how the position has been functioning for much of 2024, rather than using a contract for communications services. The 2024 Adopted Budget included 23.6 Full-time Equivalent (FTEs) Employees. The 2025 Preliminary Budget includes 23 FTEs.
Even with these reductions, it will continue to be challenging to produce a balanced General Fund in the coming years as public safety costs continue to rise. The City Council continues to consider the City's 6-year forecast. Strategies to reduce costs where possible continue to be determined and implemented, and the City continues to look for ways to maximize current revenue sources.
Upcoming Budget Meetings:
October 1, 2024, 6:00 p.m.
October 15, 2024, 6:00 p.m.
All agenda materials are posted here.
The 2025 budget calendar can be viewed here.