Bonney Lake facing a nearly $900,000 gap in 2013 budget

According to City Administrator Don Morrison, the city's revenues are expected to come up nearly $900,000 short next year, primarily due to debt service.

After several years of cutting it close but getting by, it appears the city of Bonney Lake is facing a major budget deficit for 2013.

According to City Administrator Don Morrison, the city’s revenues are expected to come up nearly $900,000 short next year, primarily due to debt service, though the drop threatens even basic services.

“The revenues we project for next year will not quite cover basic operations,” Morrison told the council during the Oct. 2 workshop. “It’s going to be a challenge.”

Morrison said revenues are declining in two major ways: Sales tax revenues are “flat” compared to last year, sales tax on construction is still “way down” due to the recession. In addition, utility fees, building permits and other sources are also seeing a dip.

At the same time, city costs, led by healthcare, continue to rise at a level Morrison said was “not sustainable.”

“Costs just keep going up,” Morrison said.

But the largest problem facing the city is the debt service on the 800 MHz communications tower and the bonds on the Justice Center.

Morrison said the tower debt comes to about $231,000 per year. The revenue was originally expected to come from the drug investigations fund, but Morrison said there has been no new revenue to that find for several years and the general fund has been forced to pick up the slack.

Bonds on the Justice Center come to about $600,000 per year and when it was built, the idea was for money from the Real Estate Excise Tax to help pay them off, but again, revenues are down in that department nearly 80 percent since a high water mark in 2007.

“There hasn’t been that many home sales,” Morrison said.

Morrison told the council he was able to cut the gap to about $500,000

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