City Council June 29 to review options for closing estimated $2.2 million budget gap

The Lynnwood City Council is scheduled during its June 29 work session to discuss the financial impacts the COVID-19 pandemic has had on the city.

City staff is estimating Lynnwood will see an estimated revenue reduction of more than $7.8 million due to COVID-19. Coupled with $1.6 million in reduced revenues in 2019, the total reduction in general fund revenues in the 2019-20 budget is pegged at $9.4 million.

Additionally, the city has identified budget cuts and other steps have been taken to offset the revenue decrease. As a result, the current “gap” between 2020 revenues and expenditures is approximately $2.2 million. Staff is still working to identify reductions in programs using the “budgeting for outcomes” methodology.

There are six options city staff will consider for closing the estimated $2.2 million general fund gap:

  1. Allow the city to temporarily use a portion of the general fund unassigned fund balance or revenue stabilization fund balance.
  2. Consider a one-time transfer from the EDIF fund in 2020 to allow the city to meet its reserve requirements of two and one-half months at the end of the year. EDIF could be replenished when a healthier economy returns.
  3. Institute a mandatory furlough program for all city employees, excluding the Lynnwood Police Department. A mandatory furlough of eight days would save the city approximately $641,000. A mandatory furlough of 15 days would generate over $1.2 million of savings to the general fund.
  4. Achieve the $2.2 million of savings needed in the general fund by laying off employees. This would require laying off approximately 56 employees for the last three months of the year.
  5. A combination of option No. 1 and No. 2 to fill the gap at the end of 2020.
  6. A combination of option No. 4 and No. 5 to fill the 2020 gap.

Councilmembers will be meeting remotely via Zoom and will stream the meeting live online. Fore more information about the council’s video streaming service, visit the council’s webpage.

To view the full meeting agenda, click here.

  1. The City may wish to bring the fire prevention services in-house rather than have South Snohomish Fire and Rescue provide these services for $1,000,000 per year. Many cities that do not have their open fire services take charge of prevention, education, and fire marshal duties.

  2. By hiring out the city is not on the hook for physical structure costs and equipment, insurance, wages, health care, pentions, lawsuits, etc. It would be nice to see a full pro/con break down of in house and out source.

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