PORT ANGELES — The Port Angeles City Council has approved a nearly $200 million budget for 2026.
The council voted Tuesday night to approve its financial plan, which is balanced at $199.842 million.
About $64 million of the budget is dedicated to critical one-time capital investments such as transportation and infrastructure enhancements, Finance Director Sarina Carrizosa told the council.
“As a reminder, the city has a few options available to fund these important capital projects when state or federal grants are not available,” Carrizosa said. “The first option is to wait until large projects face imminent failure and immediate increases in rates or taxes are required to pay for the project. This would result in significant rate increases that are unpredictable and burdensome to our customers.
“The second option is to wait until projects are critical and to take out debt, meaning that we would be borrowing funds to pay for those projects,” she continued. “This will come at a higher cost to our community as interest on the loans but also need to be paid as well. The final option is to plan for capital projects by transferring funds each year into a dedicated savings account that is utilized to pay for these projects as planned in our capital facilities plan.”
The city is implementing the third option for those projects, she said, adding it’s the fiscally conservative approach.
“This approach is also in alignment with the no-new-debt policy and it should be celebrated as the most financially responsible approach the city can take on behalf of its ratepayers and citizens,” Carrizosa said.
The budget also sticks to the minimum fund balances retained in all of the city’s funds dedicated for emergencies, she said.
“All of these funds are at or over 23 percent, and these emergency balances are the financial best practices,” she said. “At nearly $6 million in general fund emergency reserves, this is likely far higher than many of our neighboring jurisdictions and many jurisdictions across the state. And just comparing this personally, how many of us can say that we have over 23 percent of our annual salary in our savings account for emergencies?”
During the public hearing, the council heard criticism regarding the number of full-time employees increasing about 50 people from 2018 to 2026.
In response to that comment, council member LaTrisha Suggs said the city has increased its capacity in fire, police and code enforcement.
“Our capacity increases have been strategic and where they have been needed to maintain services to our citizens,” Suggs said.
James Taylor of Port Angeles, who ran unsuccessfully for a city council seat last month, criticized the council for not cutting more from the budget.
“I know, and you guys know, that there’s still fat in this budget, and as much as the city’s trying to maintain their financial position, a lot of this fat has been generated by city council,” Taylor said. “You know, real trivial things such as a tree program.”
In response to that, council member Lindsey Schromen-Wawrin said he wished the city had conducted a cost-benefit analysis instead of just a cost analysis.
“So many of the things we do, yes, we have to spend money to do them, but then we get a benefit that is hard to measure,” Schromen-Wawrin said. “And I think that’s the main reason we don’t do (a cost-benefit analysis) is it’s very hard to say what’s the relative value of the Dream Playground? What’s the relative value of street trees? What’s the relative value of five minute or less ambulance response time? What’s the relative value of a one-day turnaround at the permit counter?”
Since those things are not measured in dollars, it’s difficult to determine the value the taxpayers get from the city doing them, he said.
In addition to approving the budget, the council also voted to approve refinancing interfund loans between the Solid Waste and the Water Utility funds.
In February 2022, the council approved a $2 million loan between the two funds, and then in April 2024, an additional interfund loan of $1.5 million was approved, according to the agenda memo.
“After the transition of services, the Solid Waste utility is currently rebuilding the fund balance and, as a result, staff is recommending the two interfund loans within the Water Utility fund be refinanced to provide cost savings that will be used to purchase a compactor/bailer,” the memo states.
The purchase of a compactor/bailer will result in long-term savings estimated at about $360,000 annually, Carrizosa said. She compared the process to refinancing a home loan to take advantage of better rates or equity without increasing the overall amount of the loan.
In supporting the loan refinancing, council member Drew Schwab said the move is a direct example of the city council asking city staff to find a way to save money so rates are not raised for taxpayers.
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Reporter Emily Hanson can be reached by email at emily.hanson@peninsuladailynews.com.
