Financial Sustainability Plan
How can the City of Sammamish provide all the services the community values within a balanced budget? During 2023, the City will explore this question while developing a plan for long-term financial stability.
Project Overview
Why is this project needed?
The City needs a balanced budget so it can provide services reliably over time. The City must determine how to best serve the community within its revenue.
The City maintains a strategic reserve of operating expenses. Having a buffer allows the City to ensure continuity of service and be prepared for emergencies. The balanced 2023-2024 budget keeps a healthy reserve at the end of 2024. However, projections show that in 2028 the reserve will drop below target.
To balance future budgets, the City may need to reduce its spending, increase its revenue, or a combination.
Through this project, the City is proactively addressing the anticipated shortfall. It is fiscally prudent to plan ahead for a future budget gap because solutions may take time to implement. Adjusting services and revenue sources over a longer period is also less impactful to residents.
What will this project do?
During 2023, the City will consider approaches to eliminate the expected funding gap over the next five years. The project team will evaluate reductions to services and expenditures. They will also explore options for increasing revenue.
Informed by community input, City Council will provide guidance on next steps. A Financial Sustainability Plan will document preferred options. Identified solutions may be integrated into the 2025-2026 budget or further developed for implementation.
How will the community be involved?
Community members will form an advisory group to evaluate options and provide recommendations. Residents may offer suggestions and comments to the advisory group. There will be opportunities for community members to remain informed and provide input during the process.
Project Timeline
This project is currently being scoped and will begin soon. It is anticipated that the community advisory group will provide recommendations to City Council at the end of 2023.
How you can get involved
We need your input to understand the community’s priorities!
Join our community advisory group
We are looking for a diverse group of community members to serve in an advisory group during 2023. This group will provide invaluable feedback about which options best suit the community’s needs and preferences.
Group members will learn about the budgeting process and operational considerations. After evaluating ways the City could reduce expenses or increase revenue, the group will provide recommendations to City Council.
Interested in joining? Contact FinancePlan@sammamish.us.
Submit questions and comments
You can submit questions, comments, and ideas for the community advisory group to consider. Send your input to FinancePlan@sammamish.us.
Frequently Asked Questions
The City operates on a two-year (biennial) budget. The current budget was adopted by City Council in November 2022, setting the City’s 2023-2024 biennial budget.
The City follows the Government Finance Officer Association (GFOA) best practices in budgeting. After adoption of the City's budget, a long-term forecast is developed. This projects future forecasted revenues and expenditures over a six-year planning horizon. The most recent 2023-2028 financial forecast is included as part of the 2023-2024 biennial budget document (starts on page 249).
Both operating and capital expenses are included in the City budget.
Some examples of operating expenses are the costs of staffing, supplies, programs, planning, training and maintenance. Notably, the largest operating expenses for the City of Sammamish are its two public safety contracts with Eastside Fire & Rescue (fire and emergency services) and the King County Sheriff’s Office (police services).
Examples of capital expenses are infrastructure investments in roads, sidewalks, parks and trails, stormwater systems, fire stations, and other public facilities and equipment.
The City receives most of its revenue from the local share of property tax and to a lesser extent sales tax. These two general funding sources can be used for any aspect of City governance.
Some other sources of funding, such as criminal justice sales taxes, permit and service fees and real estate excise taxes, are restricted to be used for certain specific purposes.
Outside grant funding supplements these sources of city revenue. Grant funding allows the City to provide additional services and build projects that might otherwise be unaffordable. The City has received and continues to pursue grant funding from a variety of county, State, and Federal sources.
The economic reality is that general inflation is on the rise. Combined with a general population increase, the cost of providing the same level of service to the entire community will increase over time. Along with the community’s expanded need for services, the supplies and labor to provide them will cost more in the future than it does in 2023 and 2024.
The City will look at the cost of programs, services, and capital projects. Reductions, re-phasing, or re-design of capital projects must be carefully evaluated for cost-saving opportunities.
It is also important to evaluate the long-term cost of deferring near-term maintenance. Depending on the asset (such as a road), regular maintenance can extend the life of an asset and provide more long-term savings compared with waiting to maintain it and then facing the full cost of an emergency rebuild upon failure or collapse.
The City hired a financial consultant in 2022 to identify, review and explore potential new revenue sources that could be available to Sammamish. Some possible sources that have been discussed are a transportation benefit district, a tax on utility providers, a general business and occupation tax, and a property tax levy lid lift. Increased cost recovery of city services provided by increasing fees for services and charges could also be reviewed.