Mayor Don Gough is proposing a series of new taxes and nearly 100 employee layoffs to balance an estimated $21 million budget shortfall.
Gough presented his 2011 – 2012 budget to the City Council Monday night.
Among his proposals is a two percent increase in the utility tax (water, sewer and electricity). He said that would raise about $2 million and bring Lynnwood in line with neighboring cities such as Mountlake Terrace and Edmonds. Gough also proposed a new business tax, called Revenue Regulatory License, which businesses would pay based on their size. He estimates that would generate about $3.5 million over two years.
“That still doesn’t get us back to where we ought to be,” he said.
Gough then suggested a one-tenth of one percent sales tax increase to save police and fire jobs. The sales tax hike, which would need to be approved by voters, would bring in about $2.6 million over two years.
According to the city’s Human Resources Department, each police officer and firefighter costs about $104,000 in wages, benefits and direct costs each year.
Gough suggested that some of the proposed taxes be rolled back when the economy improves.
“When it comes back I think the public ought to be given some opportunity, that as we reload reserves and do things that need to do to stabilize the city, there ought to be a tax relief that automatically occurs to back off on the utility taxes,” he said.
Also on Monday, several employee unions received word that 96 employees would be laid off at the end of this year. Letters were sent to the Police Guild, Lynnwood Professional Firefighters Local 1984, Teamsters Local 763 and AFSCME Local 3035. Included on the layoff list are 13 firefighters, 18 police officers, as well as several Parks Department workers and various administrative staffers. Some of the police and fire jobs could be saved if the new taxes are approved.
Councilman Jim Smith, a vocal critic of Mayor Gough, called the layoff notices cruel. “He is attempting to gut our police, and the safety of our citizens, by 25 percent. He is also trying to cut firefighters while adding to the highest management positions of the fire department. Irresponsible does not even come close to describing his actions,” Smith said.
The letters, signed by Mayor Gough, said the positions are expected to be eliminated at the end of this year.
On September 1 st, a number of positions were identified as being at risk of reduction January 2011 because of an estimated 20+ million dollar shortfall in the 2011 – 2012 budget. Regretfully, the City revenue picture has not improved. And, there is nothing on the foreseeable economic horizon that is going to positively change the estimated shortfall of funds. The purpose of this letter is to give you formal notice that the City intends to layoff some positions within your bargaining unit effective at the close of business on January 1, 2011 .
The City Council will start discussing the budget proposals on Monday.