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HomeMy WebLinkAbout061623 Financial Sustainability Task Force Meeting Packetcity Port/,,,1��T ownsen Financial Sustainability Task Force Meeting Agenda June 16, 2023 — 1-3 p.m. City Council Chambers, 540 Water Street, Port Townsend, WA • Join virtually via computer or tablet at http://joinwebinar.corn enter the 9 -digit Webinar ID 229-232-163 • Join by phone in listen -only mode United States: Local Dial In — (360) 390-5064 ext. 11 access code: 725-353-128# Call to Order/Roll Call II. Approval of May 19, 2023 Minutes III. Review Agenda and Meeting Objectives IV. Review Draft Report and Suggested Funding Packages V. Roundtable Discussion on Tax and Non -Tax Financial Options to Fund No Net Loss and Enhanced Packages VI. Determine Final Recommendations to Present to Council VII. Next Steps VIII. 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(n 0) C3 m C� N c m o: 4) a .0 C: ooa (D EDm . cn � v c Ea) E E cn C) =5 a) xO � � O H� L) 0 A vi U > Z 0 2i H Z City f Vi c. lira .-T n end �mm IIF i iri � ire l iii III i,il t iii iirl � 1. iii III'im�: Initiative: IIS iii iir i � iir c iii � I � U � iii iir � II S ' III'iii 1, "I"Z rug IIS IIS iir m Draft Il µIµ ,. m '� opµ .iii III Y �r Townsen 7'17(,: purpose ofthis rporl, is to present, thefindings and C:ftbr't5 oftfic, Financial Sustainability Risk fbrce tO (,,it')l COU17CH, including a set of"recorrunendations and option5jiv, the City on itsjour�ney toward greater',financioi,5U,5t,airiability. The report is meant, to in ' frorrn the neor-terrr? and longer-teryn decisionS by the City Council and the c(,)rnrrujnity meant to deliver sustained, cZfficient, 'I'dir, and affOrdable proViSion ofbasic infleastructure and services that underpin a healthy natural environmeril,71 rneaningfUl economic development, and a high quality oflifi.,w fbr residents. The Risk Force recommendations /buis holistically or) a// cityservices with an emphasis on priorities determined through widespread community engagernent and planning over a number o,f years. The two proposed packages either sustain r:°urrent levels of SEYO ce or enhance current levels ofservice. Financial Sustainability Task Force Draft Report to City Council Page 2 of 31 Executive Sulrr'un ar� Financial sustainability is critically important for the City to meet ongoing and evolving community needs over the long-term. The aim is to deliver sustained, efficient, fair, and affordable provision of basic infrastructure and services that underpin a healthy natural environment, meaningful economic development, and a high quality of life for residents. This means carefully balancing the community's ability to generate revenues to match the cost of services and obligations over the long-term. This work has an impact on each and every one of us. The City owes it to our current and future generations to get that balance right. The purpose of this report is to present the findings and efforts of our 4 -member Council -appointed Financial Sustainability Task Force to City Council, including a set of recommendations and options for the City on its journey toward greater financial sustainability. The report is meant to inform the near-term and longer-term decisions by the City Council and the community on its journey toward greater financial sustainability. Our Task Force recommendations focus holistically on all city services with an emphasis on strategic priorities determined through widespread community engagement and planning over a number of years, including core services, housing, streets, and parks. While nearly infinite interrelated choices exist to move forward in some way with financial sustainability, there are three most basic scenarios for how to move forward: do nothing, sustain current services, and enhance services. After review of copious materials, robust discussions, and applying criteria to various choices, the Task Force has concluded that doing nothing is not an option. Thus, this report focuses on packages of inter -related and interdependent tax and non -tax options to sustain current services and, in some cases, enhance services. These two packages are described briefly below and further in Section IV of the report. Staff has prepared packages that are the most feasible for meeting the service levels for both sustaining current services as well as providing enhanced services. Package A: Sustain Current Service Core services reliant on economic development initiatives, including support of diverse commercial growth, possible future annexation of Glen Cove, implementation of a parking management program, increasing the utility tax an additional 2% above the current 2023 rate, and utilizing the banked capacity revenue. Estimated revenue: $2.21m - $2.77m. Comprehensive Streets reliant on Transportation Benefit District (TBD) sales tax, Real Estate Excise Tax (REET), Fees for Service, and Fee in Lieu or Impact Fees. Estimated revenue: $1.06m. Parks reliant on utility tax, parks foundation, impact fees, and to some degree, Glen Cove annexation. Estimated revenue: $365k. Pool reliant on regional Metropolitan Parks District (MPD) property tax and Fee for Services. Estimated revenue: $3.05m. Financial Sustainability Task Force Draft Report to City Council Page 3 of 31 Affordable Housing reliant on Fee in Lieu program, affordable housing grants, and sale of City property. Estimated revenue: $1.15m. Library operations reliant on levy lid lift on general property tax revenues. Estimated revenue: $260k. Package B: Enhance Services Core services reliant on economic development initiatives, including support of diverse commercial growth, possible future annexation of Glen Cove, implementation of a parking management program, increasing the utility tax an additional 2% above the current 2023 rate, and utilizing the banked capacity revenue. Estimated revenue: $2.21m - $2.77m. Comprehensive Streets reliant on Transportation Benefit District (TBD) sales tax, Real Estate Excise Tax, Fees for Service, and Fee in Lieu or Impact Fees, Lodging Tax. Estimated revenue: $1.08m. Parks reliant on utility tax, parks foundation, impact fees, Real Estate Excise Tax (REET) and to some degree, Glen Cove annexation. Estimated revenue: $465k. Pool reliant on regional Metropolitan Parks District (MPD) property tax and Fee for Services. Estimated revenue: $4.35m. Affordable Housing reliant on Fee in Lieu program, affordable housing grants, and sale of City property. Estimated revenue: $1.15m. Library operations reliant on levy lid lifts on general property tax revenues. Estimated revenue: $520k. The City Council will receive these recommendations in July when the report is final. Deliberations are expected over the coming months with consideration of policy decisions and future budgets. Deliberations and community engagement is also expected into the coming years, as it will likely take many years to craft and implement sustainable solutions. One thing is certain: inaction will only put us further at risk and potentially jeopardize a more sustainable future for us all. In contrast, proactive, sustained, collaborative efforts will help us balance our community's aspirations with financial realities and prepare us for the future that we choose — a future that is more stable, more sustainable, fairer, and better for us all. Financial Sustainability Task Force Draft Report to City Council Page 4 of 31 II I III w hritroductiori & Background Financial sustainability is critically important for the City to meet ongoing and evolving community needs over the long-term. Providing basic infrastructure and services that underpin a healthy natural environment, meaningful economic development, and a high quality of life for residents means carefully balancing the community's ability to generate revenues to match the cost of services and obligations over the long-term. This work has an impact on each and every one of us. The City owes it to our current and future generations to get that balance right. The City of Port Townsend is in a solid financial position at the current time due to a number of unusual circumstances. Even with significant challenges and substantial revenue reductions caused by the COVID- 19 pandemic, the City managed to adapt, innovate, and collaborate to sustain operations and to stay within its budgetary constraints. Additionally, federal and state COVID support provided funding to help the City navigate these last three years. This current financial condition provides the perfect timing and context to evaluate the long-term financial sustainability of the City. Pre-COVID outlooks showed significant future financial challenges threatening the public services we all depend on and enjoy. Disinvestment in streets and parks are two of the largest indicators illustrating these challenges. Sustaining services and service quality in the face of increasing service costs and while tax revenues are not keeping pace with those costs defines the fundamental problem. That said, this problem may not be fully understood by the public who depend on those services. The problem is compounded by the present need to address numerous deferred maintenance projects such as streets, city buildings, parks, and fleet for which limited or no direct revenue is currently available. Finally, the current labor and housing market put additional stresses and challenges on the Port Townsend City government as well as on our local businesses, organizations, and the public we serve. It will take many years to craft and implement sustainable solutions. The longer we delay action, the more likely we are to suffer a major setback and the more difficult the work will be to ensure our financial sustainability well into the future. However, working together closely as a community will help us balance our diverse aspirations with financial realities and prepares us for the future. Doing so is also a promising opportunity to align expectations, build strong and productive partnerships, develop lasting trust, and draw our community closer together as we chart a course to a better future for all. Financial Sustainability Task Force Draft Report to City Council Page 5 of 31 Vision arid Desired Outcomes While every individual's vision for the future may be different, the general vision for this work is for the sustained, efficient, fair, and affordable provision of basic infrastructure and services that underpin a healthy natural environment, meaningful economic development, and a high quality of life for residents. Put another way, the work aims to carefully balance the community's overall needs for services that deliver important outcomes with our ability to generate corresponding revenues over the long-haul. The vision and outcomes require thoughtful, deliberate, proactive, and courageous collaboration and decision-making by the City Council and the community at large. Solving for the future our community wants also means a systems -approach to solve for the whole instead of individual pieces; this is represented by interconnected intervention packages and recommended actions described in Section IV below. It is meant to weave together core service needs for a functioning and effective city government alongside specific community -identified funding priorities of housing, streets, and parks. The specific outcome of this Financial Sustainability Initiative effort is a 10+ year implementation strategy meant to ensure: • Core services are sustained in order to provide a baseline level of service for an effective and functioning city government. • Investment in housing to address the current housing crisis and improve housing attainability so that all income levels have access to quality, attainable housing. • Investment in the street system is initiated in a preventative maintenance program and to claw back from lack of investment over the past 20+ years. • Investment in the parks system to address a pool that needs to be replaced and improvement/development of parks and recreational facilities over the long term while sustaining maintenance of the facilities the City already is responsible for maintaining. Hinainciiai Sustaiiiirmabiiiiliity "I ask Foirce and IIP IIeirnbeirs The City of Port Townsend established a four -member Financial Sustainability Task Force, appointed by the Mayor and Council through an application system, to assist the City with a review of the City's current financial position and to identify options for the future. The Task Force began its work at their first meeting on November 18, 2022. They have met six subsequent times, usually for 2 -hour blocks and with deep review of significant materials in-between meetings. The Task Force also met jointly with the City Council on May 8, 2023, to discuss the work they had completed to date and to provide City Council a chance to ask questions and dialogue around findings to date. That meeting is not included in the graphic below. Financial Sustainability Task Force Draft Report to City Council Page 6 of 31 The Task Force has been working toward a recommendation of long-term financial sustainability options to City Council in mid -2023, represented by this report. The Task Force has reviewed information and materials regarding municipal budgeting, the City's current department budgets and service levels, community engagement, financial forecasting, priority initiatives, peer city comparisons, level of service considerations, revenue options and strategies, and evaluation criteria for funding strategies. A selection of those materials can be found in the Appendix (Section VI) and all meeting minutes, agendas, materials, and video recordings can be found at: httDS://CitvofDt.us/enizaaeDt/sage/financial-sustainabilitv-initiative. All the meetings have been open to the public. Public comment was available during all these meetings. Members of the Task Force include: • Catharine Robinson • Earll Murman • John Nowak • Rick Jahnke Birliief Descriptions of Services, Core Service Needs, aind Auras of IlPirlioir i't'y lCIW The City of Port Townsend directly provides a number of important services to the community. The City also works in partnership with other agencies who may play a more direct role in some service provision, as per below: Financial Sustainability Task Force Draft Report to City Council Page 7 of 31 I M a WOMEN= SERVICES PROVIDED lay"r'HIE 01 Development Services: Planning, perinnitting,L inspections General Government. City management, Ilegall services, finance, human resources, IT Library: Library services Pal Recreation & Community Services- Park maintenance, recreatronall activiities police. Plubllic safety services PublicWorks. Maintenance of physical infrastructureand transportation systems Solid Waste: Garbage and recycling services Water/Sewer: Drinking water sewer treatment services SlISIRVIICES IRM.)VIIIIIINEID IIT AEFFIERSON1 COUNTY Assessor. Assessment of real property Economic Development- Buirsiness attraction and retention Emergency Mlanagemenc Disaster planning, mitigation, and recovery Environimentall Public Health. Water quality maintenance, lDreservation of open space, IDeir-matting of waste systems Municipall Couirt. Processing of cases and collection of fines, Public Health. Communicable disease management, family health services SIEIR'VH,'.IES PROVIDED 13YOTIHERIENTITIES Electricity (via Jefferson County PUD) Fire prevention and emergency response (via East Jefferson Fire and Rescue) K-112 education (visa Port Townsend Schooll District) Port maintenance (via Port of Port Townsend1 Public transit (via Jefferson Transit Authority) 911 services (via JeffCom) A few key examples of services provided by the City are above. This is not an exhaustive list. The following provides the next layer of deeper detail — but is also not an exhaustive list: Deliver on critical oiler otions, otigoirlig statutot-y responsibilities, on core City ftirfictiorlis Legal services Utility billing and cashiering for variety of City services Insurance and risk management Annual reporting and municipal audits Records management Business license compliance and business and occupation tax reporting Responding to public records requests Purchasing administration and accounts payable Public meetings Payroll Training of elected members, staff and volunteers Information Technology — including network security and user support Liaison with Councilmembers, and stewardship of political decision-making Books & material circulation including curbside delivery, databases, e -books Community leadership and partnership with other agencies and organizations and e-audiobooks, children's web resources, grab bags, interlibrary loan Workplan and budget development: integration and oversight of City operations Programs and events, including virtual programming, youth programming Compliance with internal and external policies, regulations and requirements and adult programming Coaching, mentoring and performance evaluation of employees Staff response to patron requests and associated services Special projects, communication, engagement and advocacy Access to technology Code compliance Emergency response Permitting review and approval Patrol, investigation Building inspections Special events Current planning Emergency preparedness • Long-range planning Records requests Recruitment, including development of a recruitment strategy Training Union contract negotiations Policy development and refinement Retention, including a retention strategy and employee recognition program Street maintenance, operations and programming Performance evaluation Stormwater operation and maintenance Employee engagement, engagement survey and manager follow up Wastewater collections and treatment and compost Coaching, mentoring and training programs Management of trash collection and recycling Internal HIR -related policy development, application and evaluation Drinking water treatment and distribution Facilities management, oversight, property management, rentals and event permitting Engineering, major capital projects City Volunteer Program, including adopt -a -trail, adopt -a -park and Library/Police volunteers Development review for infrastructure extension Budgets and financial reporting Right of way management including urban forestry Forecasting and financial analysis Fleet operations, maintenance, and replacement Management of parks and trails systems The cost of city services broken down by department is below. Note that the utilities/enterprise funds like water and wastewater are not included since they are required to be separate self-sustaining budgets based on rates: Financial Sustainability Task Force Draft Report to City Council Page 8 of 31 I■ I EIIIIIIIIIIII PUI-'dic Wodo 6't ks, etreotuw�, e,.intl ±Curr9unu ity &e wires f'Vanrfing and Cormri wifyr C: evelcapn ent U 4,.n,rary Adurtiinkirotion, 0"incv'Ruro, oncl lHr4 Finally, given local, regional, statewide and federal complexities, it is no wonder that funding sources and recipient services are often misunderstood. For instance, only 11% of local (Port Townsend) sales tax revenue and 16% of property tax revenue go directly to the City of Port Townsend. A range of other regional municipalities as well as the State of Washington receive the remaining majority of sales and property tax funding generated locally in Port Townsend. This means that those services provided above are not funded to the degree that many in our community believe they are, which often creates a mis-match in community expectations with ability to provide services based on revenue. Core Services Core services are fundamental to a functioning city. They include attending to critical operations, ongoing statutory responsibilities, and core functions that individuals, businesses, and organizations rely on to survive and thrive. For instance, City provides for public health and safety through necessary infrastructure for safe transportation. The City provides community policing to ensure an environment where community members can safely engage in day-to-day activities. The City supports a public library that provides community programming, services and safe places for everyone. Planning and Community Development provides planning, permitting and inspections for needed housing services. All core services are managed through the general government of the City. The City also provides for public health and safety through necessary infrastructure like water and sewer systems and solid waste removal. These systems are required to be self-sustaining through rates, so we are not considering them as core services as part of this work. Financial Sustainability Task Force Draft Report to City Council Page 9 of 31 Core services also underpin the success of all city departments and all other city initiatives. Simply put, without core services, all other initiatives and services suddenly or eventually fail. For instance, the City relies on functioning buildings and facilities — from the carpet to the roof — to ensure other services, from police to permitting, can be provided. Historically, the City has not funded repair and replacement of key building systems like replacement of roofs, HVAC systems, painting, elevators, and carpets. Therefore, facilities needs arise as large surprise cost items every 20 years or so and either require emergency funding or further deferral, often to the point of failure and subsequent disruption of the other systems under the same roof that rely on those core services. Other examples of core service needs where deferral may create significant risk or disruption from failure include cybersecurity and IT systems, fleet, financial audits, public records management, human resource management, and union agreements. Housing Housing is vital to community prosperity. Multiple types of housing at many different affordability levels was historically key to sustaining a healthy workforce contributing to the City's growth. However, over time increasingly restrictive zoning practices in conjunction with inflation, high labor costs, and the 2008 recession has limited housing with trends towards larger market rate units. The City's population has only grown to 10,000 people even though the pre -platted historic lots in the City were designed for more than 20,000 people. Housing uniquely generates revenue in the form of property taxes, construction tax, and real estate excise taxes, but there is little revenue from the City to reinvest or subsidize missing middle "attainable" housing, which the City defines as affordable to those earning between 80-200% Area Median Income (AMI). Adding more housing in a dense urban pattern can help reduce utility costs for ratepayers. The City has a minimal source of money, $25,000 annually, generated from 0.1% of sales tax that helps fund affordable housing and homeless housing programs targeting those earning less than 80% of area median income for a family of four. The funding is pooled with money from Jefferson County and allocated through a Housing Fund Board grant program and is insufficient to meet City affordable housing unit targets. There is no other dedicated revenue source to support housing and the infrastructure (streets, sewer, water line extension) needed for construction, particularly funding to help construct missing middle "attainable" housing. Several tools described in this report as well as the White Paper Exploration of Strategies for Supporting Infill and Affordable Housing Related to Infrastructure Development (link to draft report in the Appendix, Section VI) could provide more funding such as an infill affordability strategy that links zoning reform (already in progress) to in lieu density fee payments, which charge a fee for homes that do not meet minimum density used to pay for middle housing infrastructure. The revenue source would need to subsidize fee payment for affordable and middle housing, which would require a budget of $1.78 million annually assuming $30,000 in fees waived per eligible unit. The actual number of units that are supported will depend on the revenue and the amount of subsidy needed per unit. As a program develops, success will depend on the City's ability to generate revenue to meet the demands associated with the number of units requesting support. The primary method for the City to provide this support is through the development of infrastructure, which is often lacking and a fundamental requirement for the development of housing. In addition to supporting the development of attainable units through subsidizing infrastructure, a second key housing strategy is to support housing through the development of land. It is estimated that direct reoccurring investment in preparing City property for neighborhood development such as the 150 -unit neighborhood the City is planning for Evans Financial Sustainability Task Force Draft Report to City Council Page 10 of 31 Vista would require an enhanced budget of $442,000 per year. By supporting housing growth in a carefully planned manner, the City can balance the development of private attainable housing to support middle income and wage earner households and further support public or non-profit owned affordable housing. This balance of providing diverse affordability options also impacts tax revenues since most social housing is exempt from property tax. All housing provides the benefit of construction sales tax; however, the main source of revenue to support housing likely comes in the form of fees. A common objective for all housing is to prioritize density in order to reduce the overall tax and utility rate burden for the entire community in an effort to facilitate a more sustainable future. The City is developing a Comprehensive Streets Program in response to the rapid deterioration of the 81 miles of City -maintained streets. The current investment in streets of $1.2 million per year does not include funds for preservation and repair of street surfaces or funds for matching grants. This pattern of deficient investment has resulted in increasing debt and many streets falling into a state of disrepair that requires complete and costly reconstruction. The City Council Infrastructure and Development Committee reviewed options for street investments including a no -net loss alternative where an additional investment of $750,000 per year maintains what we have but does not make improvements to the streets that are in disrepair. The Infrastructure and Development Committee's preliminary evaluations recommends increasing street investments by $1.5 million per year to a total of $2.7 million per year in order to claw back the condition of city streets to a state of good repair. This claw back period is likely on the order of 30 years of sustained investment. Parks Port Townsend has continued to love its parks, recreation, and trail system. The City manages 190 acres of publicly owned land, maintains and contracts operations for an old pool, hosts a nature park, maintains two dog parks and 33 miles of public trails, contracts operations for a 9 -hole community golf course, hosts the pickleball club with five permanent and more temporary courts, and enjoys a great collaboration with Jefferson County Parks and Recreation. This is done on a minimal budget, about 1/3 rd of the nationwide median for communities the size of Port Townsend. The City does not have dedicated funding for parks and recreation. The general fund budget currently maintains all our parks and recreation assets along with police, streets, and city administration. Funding in this manner is never guaranteed and must be approved annually by City Council. Approximately $1M is spent currently to maintain what we have, contract the pool and golf course operations, and work to keep our parks open. A budget of approximately $3M would keep parks and playgrounds open, establish a capital program to take care of deferred maintenance and replacements of tired assets. A budget of about $4.5M would be required to establish a Parks Department dedicated to maintaining and enhancing the current level of service, including replacement of the current Mountain View pool. i.evell of Service While nearly infinite interrelated choices exist to move forward in some way with financial sustainability, there are three most basic scenarios for how to move forward. Each scenario is a pathway with particular Financial Sustainability Task Force Draft Report to City Council Page 11 of .31 impacts to our community, both in the short and long-term. Each pathway results in a level of service for those services and needs requested and required by our community, as described above. Do Nothing Sustain Current Services Enhance Services The first pathway is to do nothing. This means no new revenue and reductions of current service levels since current funding does not keep pace with inflation and costs. While the City is required to balance a budget each year, under the do nothing scenario, the current service level would drop significantly by 2029 as reserve funds would be utilized to plug the interim gaps (see chart below). This looks like a "fiscal cliff." It means things like significant service cuts, cuts to hours, and cessation of certain functions currently provided by the City, as the City is required by state law to balance the budget. The City has previously made such service level reductions to balance the budget. As an example of the do nothing pathway, city streets would continue deterioration and become worse over a short time period. This is largely because revenues for streets fell significantly with the state initiatives of the late 1990s related to reduction of car tabs. While some cities have developed new revenue sources in order to avoid a do nothing pathway, Port Townsend has not yet developed new revenue sources for streets. The second pathway is to sustain current services. This means "no net loss" of current services and yet still requires an increase in investments to keep service levels constant. It likely means no new services, but also no "fiscal cliff" like the do nothing pathway above. This pathway requires efficiencies, as do all of them. Using the streets example, decay of city streets would slow and then mostly stop with sustained investment, but they would not become better than they are today. This "sustain" pathway for streets Financial Sustainability Task Force Draft Report to City Council Page 12 of .31 ENDING FUND BALANCE & PESERVETARGET (Gelrelrei, Streets, & REET, Corn Svcs, & Delft Funds) Status Quo �aua $5 I �...., ���„ � aha a +r +' u:1!. CO0 rf4 'Cq. 5 RA- [a. Lt J_ LV.. < f t °0 °4- 4.f"r 4�P,Y P'. °A :^4 G.` PM N 1 C4F PSB CA. M BBV N Is a4 C.7 a Q'J b p+y '4 Ya Y'V far "MY "5 M1.'Y 0 4,"+ 0 �,4 C'MV CN C4 19 4^$ 0 6»Y P4 N C^8 1; 0 N rare. 0 ,..±x;10 e11010101NOR "roa':a0 Endlinq Fund E4aaHancap f otall P01111Icy Reseewo5 The second pathway is to sustain current services. This means "no net loss" of current services and yet still requires an increase in investments to keep service levels constant. It likely means no new services, but also no "fiscal cliff" like the do nothing pathway above. This pathway requires efficiencies, as do all of them. Using the streets example, decay of city streets would slow and then mostly stop with sustained investment, but they would not become better than they are today. This "sustain" pathway for streets Financial Sustainability Task Force Draft Report to City Council Page 12 of .31 would require approximately $750,000 of new annual investment. At the City-wide scale, sustaining current services would require an additional investment of approximately $4.9m above current funding levels across all general government functions. The third pathway is to enhance services. While efficiency continues to remain important and necessary and there are trade-offs between desired services, new revenue allows for enhancement of services. Increasing investments above the sustain services level allows the community to realize the vision that the community desires. Using the streets example again, city streets would gradually improve over time, eventually leading to a system -wide improvement over the coming decades. The approximate investment beyond current levels to enhance streets is estimated to be $1.5m. Enhancing all general government services results in an increase of $10.4m in revenue above the current funding levels. Overall, the enhancement of services has been quantified by community feedback through development of a Comprehensive Streets Program, exploration of housing initiatives, and evaluation of parks improvements such as the Healthier Together initiative for a new pool, and the Envision the Golf Course discussion. The following table illustrates approximations for various functions of general government. The three columns of the table illustrate current investment levels, the level of investment to sustain services, and the level of investment needed to enhance services. These figures are expressed in totals with the delta provided at the bottom of the table. Total $ 12,801,230 $ 17,764,722 $ 23,218,264 Increase in Revenue $ $ 4,963,492 $ 10,417,034 Financial Sustainability Task Force Draft Report to City Council Page 13 of .31 Bucket Do Nothing No net Loss Funding Description Current Inv. Inc. Inv. Inc. Inv. Level of Service Impacts Lower Sustain Increase General Fund Police $ 4,213,400 $ 4,213,400 $ 4,463,400 Finance / Inf. Technology $ 1,047,215 $ 1,047,215 $ 1,207,215 Legal/Clerk/Records $ 989,543 $ 989,543 $ 1,150,000 City Manager/City Council/Communications $ 393,000 $ 393,000 $ 658,000 Human Resources $ 475,072 $ 475,072 $ 510,072 Planning and Community Development $ 1,550,000 $ 1,550,000 $ 1,680,000 Fleet Replacement (Police, Parks, Eng., Admin, Fac.) $ $ 264,000 $ 394,600 Facilities Repair and Replacement $ $ 395,492 $ 612,97711111 Labor Inflation/Shortage/Vacancy $ 605,000 $ 725,000 Pool $ 400,000 $ 2,200,000 $ 2,950,000 Parks $ 600,000 $ 890,000 $ 1,365,000 Streets $ 1,200,000 $ 1,950,000 $ 2,700,000 Library $ $ 300,000 $ 450,000 Debt Service $ 1,700,000 $ 1,700,000 $ 1,700,000 Housing direct investment $ 62,00011111° $ 442,000 $ 442,000 Attainable Housing Incentive Program - Rev. Source Impact fees and/or fee in lieu $ 40,000 $ 100,000 $ 1,780,000 Parking Management and Event Management $ 101,000 $ 150,000 $ 300,000 GIS programs (general fund services) $ 30,000 $ 100,000 $ 130,000 Total $ 12,801,230 $ 17,764,722 $ 23,218,264 Increase in Revenue $ $ 4,963,492 $ 10,417,034 Financial Sustainability Task Force Draft Report to City Council Page 13 of .31 Options and Il Balance The three basic options above can also be considered as balanced trade-offs between three concepts: growth, funding strategies, and level of service. For the second (sustain current services) and third (enhance services) pathways, if new funding strategies are not pursued, the options are for a community to focus on growth and/or reduce costs or find efficiencies: uir..'i d li ii°i St rZi it 6?g li e aiid ie,�n,3ip If new I"Fu iidlrii g 1,;t—alle, g. are not pursued, allterina-tives are for a community t0 focus on fr' rirh and/Or S/ f( d E� f f1 i EP r I r l� Ire , � �� 1.mp��uioiuiuiuiuumumumumuuiuiuiuiuiuiuiuiuumumumumuuiuiuiuiuiuiuiuiuumumumumuuiuiuiuiuiuiuiuimumumumumiulu���u��Nu. � t While the Task Force and this report does not take a direct stance on the current state and federal tax policy or on growth, for better or worse, it is a growth -based tax system and growth is likely to happen whether we direct it, plan it, or not. Thus, it often requires non -tax (growth) policies to achieve desired outcomes Efficiencies Finding efficiencies is a critical element for any pathway forward. Not only does the landscape of service provision continually change — demanding an ability to anticipate change and adapt accordingly — but delivering value to our community simply requires a mindset of continual quality and process improvement. To those ends, a few examples of City efficiencies in the past few years: • Contracting for pool services • Enhanced volunteer programs for parks and other areas in the city • Online permitting • Public Experience Liaisons and new City Hall front counter • On-call permitting services • Change to mowing • Lean thinking • Electronic City Council and Advisory Board materials • Updated financial software and electronic payment options Financial Sustainability Task Force Draft Report to City Council Page 14 of 31 The need for efficiencies is eternal; the above list only denotes an ongoing challenge, commitment, and efforts to gain efficiencies and make best use of existing and future resources. Criteria The Task Force used six general criteria to evaluate a set of tax and non -tax revenue options. Those criteria included: • Magnitude. How much net revenue could this option generate? • Growth: How is this revenue source expected to grow or decline in the future? • Stability: How stable is this revenue source? • Equity: How much does the revenue option align the burden of who pays with who benefits? • Political feasibility: How politically feasible is the option? • Restrictions/Alignment with needs: What can the revenue be used for? Can it meet the City's needs? As an exercise to help bolster the conversation and discussion, the Task Force used the criteria to evaluate and score options. The tax and non -tax revenue options can be found in the Appendix (Section VI). Financial Sustainability Task Force Draft Report to City Council Page 15 of 31 After review of copious materials, robust discussions, and applying criteria to various choices, the Task Force has concluded that doing nothing is not an option. Thus, the following are two packages of inter- related and interdependent tax and non -tax options to A) sustain current services and B) enhance services. As of the current draft of this report, a suitable combination of strategies has not yet been identified that is fully able to meet the funding requirements of the enhance services package. Al:package A: Sustain Current Services Core Services Long-term general government (core services) are reliant on economic development strategies to increase revenues in excess of inflation for financial sustainability. These include support of diverse commercial growth as well as a possible future annexation of Glen Cove. Proposed strategies also include the implementation of a parking management program, increasing the utility tax an additional 2% above the current 2023 rate, and utilizing the banked capacity revenue. Even with these proposed strategies, the City will not be able to sustain current services beyond 2030. Revenue Option Annual Amount Note Glen Cove Annexation $680k Est. to begin in 2030 Diverse Commercial Growth $50k - $610k Est. to begin in 2025; grows considerably with commercial development Planning -Fees for Services $100k Est. to begin in 2025 Parking Management Program $150k net Est. to begin in 2025 Utility Tax-Councilmanic $152k Raise to 24% effective rate (includes continuing 2% for Parks) Infill Development Strategy $95k Est. to begin in 2025 Multi -family development— Sales Tax $76k Est. to begin in 2025 Multi -family development- Property Tax $7k Est. to begin in 2025 Banked Capacity $900k Est. to begin in 2024; unrestricted use Total Revenue Options $2.21m - $2.77m A2: Comprehensive Streets A comprehensive streets program requires identifying a new revenue source in order to begin the process of rebuilding our street infrastructure. Proposed strategies include implementing a Transportation Benefit District funded through sales tax. Additional strategies include Fees for Services, Fee in lieu or Impact Fees and Real Estate Excise Tax (REET) for federal or state grants. With this funding package, the City would be able to meet the financial objective to sustain current services. Financial Sustainability Task Force Draft Report to City Council Page 16 of 31 Revenue Option Annual Amount Note Transportation Benefit District (TBD) Sales Tax 0.1% $225k Councilmanic Est. to begin January 1, 2024 Transportation Benefit District (TBD) Sales Tax 0.2% $550k Voted Est. to begin April 1, 2024 Real Estate Excise Tax (REET) $100k Est. to begin in 2025; For grant match Fees for Service (Permit fees) $85k Est. to begin in 2024 Fee in lieu of or Impact Fees $100k Est. to begin in 2024 Total Revenue Options $1.06m A3: Parks Long-term operations of the Parks and Trails system rely on general government revenues. Additional proposed revenues include the future Glen Cove annexation, reinstatement of the dedicated 2% Utility Tax for Parks, creating Impact Fees and establishing a Parks Foundation that would encourage legacy donations as well as public / private partnerships. With these additional funding options, the City's Parks and Trails will remain reliant on general government revenues and are not able to sustain current services independently. Revenue Option Annual Amount Note Glen Cove Annexation $13k Est. to begin in 2030 Utility Tax-Councilmanic $152k Reinstate 2% Utility Tax set to expire December 31, 2023 Parks Foundation $100k Est. to begin in 2024 Impact Fees $100k Est. to begin in 2024 Total Revenue Options $365k A4: Pool The Mountain View pool is beyond its useful life and will require the full support of the community and region to establish a new funding source to replace the existing pool. The proposed strategy is to establish a Metropolitan Parks District (MPD) through an additional property tax levy. Other proposed revenues include establishing Fees for Services. With this funding option, the City and partners would be able to build and sustain a pool similar to the existing pool. Revenue Option Annual Amount Note Metropolitan Parks District (MPD) (.50 per 1,000) Regional District $2.6m Voted Est. to begin in 2025 Fees for Services $450k Est. to begin in 2025 Total Revenue Options $3.05m Financial Sustainability Task Force Draft Report to City Council Page 17 of .31 A5: Affordable Housing Developing a program for Affordable Housing requires establishing new revenue sources and policies that that will be dedicated to the creation of both affordable and attainable housing. Proposed strategies include the creation of In Lieu Fees (at $5,000/unit) for housing units greater than above market rate, obtaining affordable housing grants and the sale of City property to provide a direct investment in housing. The sale of City property is a limited resource as it is dependent on available land inventory. These proposed resources do not adequately provide for the level of housing required to sustain the City's workforce housing needs. Revenue Option Annual Amount Note In Lieu fees ($5,000 per unit for above market units) $150k Est. to begin in 2025 Affordable Housing Grants $500k Est. to begin in 2026 Sale of property—to support direct investment in housing $500k Est. to begin in 2025 Limited City resource, dependent upon available land inventory Total Revenue Options $1.15m A6: Library Operations Long-term library operations are reliant on general property tax revenues as the primary revenue source to sustain services. Strategies are limited to increase revenues that keep pace with inflation for financial sustainability. Revenue Option Annual Amount Note Levy Lid Lift (.10 per 1,000) City Only $260k Voted Est. to begin in 2027 Total Revenue Options $260k Financial Sustainability Task Force Draft Report to City Council Page 18 of 31 package B: El�in�haince Services 1131: Core Services Long-term general government (core services) are reliant on economic development strategies in both packages to increase revenues in excess of inflation for financial sustainability. These include support of diverse commercial growth as well as a possible future annexation of Glen Cove. Proposed strategies also include the implementation of a parking management program, increasing the utility tax an additional 2% above the current 2023 rate, and utilizing the banked capacity revenue. Even with these proposed strategies, the City will not be able to sustain current services beyond 2030. Revenue Option Annual Amount Note Glen Cove Annexation $680k Est. to begin in 2030 Diverse Commercial Growth $50k - $610k Est. to begin in 2025; grows considerably with commercial development Planning -Fees for Services $100k Est. to begin in 2025 Parking Management Program $150k net Est. to begin in 2025 Utility Tax-Councilmanic $152k Raise to 24% effective rate (includes continuing 2% for Parks) Infill Development Strategy $95k Est. to begin in 2025 Multi -family development— Sales Tax $76k Est. to begin in 2025 Multi -family development- Property Tax $7k Est. to begin in 2025 Banked Capacity $900k Est. to begin in 2024; unrestricted use Total Revenue Options $2.21m - $2.77m 62: Comprehensive Streets A comprehensive streets program requires identifying a new revenue source in order to begin the process of rebuilding our street infrastructure. Proposed strategies include implementing a Transportation Benefit District funded through sales tax. Additional strategies include Fees for Services, Fee in lieu or Impact Fees, Real Estate Excise Tax (REET) for federal or state grants, and Lodging Tax. Even with this funding package, the City would not yet be able to fully meet the financial objective to enhance current services. Revenue Option Annual Amount Note Transportation Benefit District (TBD) Sales Tax 0.1% $225k Councilmanic Est. to begin January 1, 2024 Transportation Benefit District (TBD) Sales Tax 0.2% $550k Voted Est. to begin April 1, 2024 Real Estate Excise Tax (REET) $100k Est. to begin in 2025; For grant match Fees for Service (Permit fees) $85k Est. to begin in 2024 Fee in lieu of or Impact Fees $100k Est. to begin in 2024 Lodging Tax $20k For Place Making/Tourism Est. to begin in 2024 Total Revenue Options $1.08m Financial Sustainability Task Force Draft Report to City Council Page 19 of .31 B3: Parks Long-term operations of the Parks and Trails system rely on general government revenues. Additional proposed revenues include the future Glen Cove annexation, reinstatement of the dedicated 2% utility tax for parks, creating impact fees, using Real Estate Excise Tax (REET) and establishing a Parks Foundation that would encourage legacy donations as well as public / private partnerships. With these additional funding options, the City's Parks and Trails will remain reliant on general government revenues and are not able to sustain current services independently. Revenue Option Annual Amount Note Glen Cove Annexation $13k Est. to begin in 2030 Utility Tax-Councilmanic $152k Reinstate 2% Utility Tax set to expire December 31, 2023 Parks Foundation $100k Est. to begin in 2024 Impact Fees $100k Est. to begin in 2024 Real Estate Excise Tax (REET) $100k Est. to begin in 2025; For grant match Total Revenue Options $465k 64: Pool The Mountain View pool is beyond its useful life and will require the full support of the community and region to establish a new funding source to replace the existing pool. The proposed strategy is to establish a Metropolitan Parks District (MPD) through an additional property tax levy. Other proposed revenues include establishing Fees for Services. With this funding option, the City and partners would be able to build and sustain a pool with modest enhancements to the existing pool (e.g., regulation length lanes). Revenue Option Annual Amount Note Metropolitan Parks District (MPD) (.75 per 1,000) Regional District $3.9m Voted Est. to begin in 2025 Fees for Services $450k Est. to begin in 2025 Total Revenue Options $4.35m 65: Affordable Housing Developing a program for Affordable Housing requires establishing new revenue sources and policies that that will be dedicated to the creation of both affordable and attainable housing. Proposed strategies include the creation of significant In Lieu Fees (greater than the sustain package at $50,000/unit) for housing units greater than above market rate, obtaining affordable housing grants and the sale of City property to provide a direct investment in housing. The sale of City property is a limited resource as it is dependent on available land inventory. These proposed resources do not adequately provide for the level of housing required to sustain the City's workforce housing needs. Financial Sustainability Task Force Draft Report to City Council Page 20 of 31 Revenue Option Annual Amount Note In Lieu fees ($50,000 per unit for above market units) $1.5m Est. to begin in 2025 Affordable Housing Grants $500k Est. to begin in 2026 Sale of property—to support direct investment in housing $500k Est. to begin in 2025 Limited City resource, dependent upon available land inventory Total Revenue Options $2.5m 1136: Library Operations Long term Library Operations are reliant on general property tax revenues as the primary revenue source to sustain services or to provide increased level of services or programs. Strategies are limited to increase revenues that keep pace with inflation for financial sustainability. Revenue Option Annual Amount Note Levy Lid Lift (.10 per 1,000) City Only $260k Voted Est. to begin in 2027 Additional Levy Lid Lift (.10 per 1,000) City Only $260k Voted Est. to begin in 2025 Total Revenue Options $520k Financial Sustainability Task Force Draft Report to City Council Page 21 of 31 V. ("ondusion/Next Steps This section is forthcoming. We anticipate it to include: • Areas still under development. Where are there still areas where we do not meet desired funding levels and why? • Timeline and milestones. When are key decisions over multiple months and years? How does this report work itself into the 2024 workplan and beyond? Is there a corresponding implementation matrix that firms up based on further Task Force conversations/direction and City Council feedback? • Call to action/engagement. How can community members get involved? What visual elements from existing engagement like the videos can be repeated/underscored here? • Concluding message. Recap of why this initiative is important and reiterate a positive, sustainable, collaborative future for all in our community. Financial Sustainability Task Force Draft Report to City Council Page 22 of 31 M. Appendix Select Figs k Force Background Materials A selection of slides from the Task Force meetings is below. For a full set of agendas, minutes, presentation materials, and video recordings, visit: https://citvofpt.us/engagept/page/financial-sustainability-initiative. BOOM= NI The bUdget is ai-i econiornic plain that fOCLises the ei-itity's finarlciall and hurnan resourcleg on the accoirriphshirrient of specific goals and objectives established bythe policy malleirs, NI The bUdget estaHishes the aniival rever)Ue and experdituire levelk, cafled appropiriations, fIcn, dejpanlirnents and furds. NI A city bUdclet i-nust be baanced: revenues 'a expenditures NI Ponl Towi-isend Currently operates on can anrt,4l budget and aH appropriitioiis are for that calendar year allone. SEII PIROVIDED BY-HIECITY Development Services: Planning, permitting, inspections General Government: City management, Ilegall services, finance, human resources, IT Lilbral Library services Parks, Recreation & Community Services.- Park maintenance, recreational activities police: Plubllic safety services PublicWorks. Maintenance of physical infrastructure and transportation systems Solid Waste: Garbage and recycling services Water/Sewer:Difinking wateir, sewer treatment services III Lega�l requireirnent III Azcoiuntabfllity arid trarisj:)arericy How the City spends taxpayer and ratepayer money Sh2iring accornplishrnents . Performance evaluation . Performance measures III Mariagementtodl III Plarinirig JOCILM,ient SERVICES IPROMIDIED IBY AEFFIMISON COUNTY Assessor: Assessment of real property Economic Development: Business attraction and retention Emergency Mlanagemeniti IDiisaste,r planning, mitigation, and recovery Environmental Public Health. Water quality maintenance, IDneservation of open space, IDer-miffing of Yvaste systems Municipall Court. Processing of cases and collection of fines Public Health. COMMUPICIBIDle disease, management, family health serviire,s SEIRVICIES PROVIDED 13YOTHER ENTITIES Electricity (via Jefferson County PUID) Fire prevention aindl emergency response (via East Jefferson Fire and Rescue) K-11 2education (via Port Townsend School District) Port maintenance (via Port of Port Townsend) Public transit (via Jefferson Transit Authority) 911 services (v i a Jeff,(,- onl Financial Sustainability Task Force Draft Report to City Council Page 23 of .31 EM Police Pull-flic Works Porky, Recreation, cHid Community &ervices Mcuming and Communiy Develr,>l',)meint U111 Ory A,clmini,ore..,wtion, Finance, and IHR Stotebf'WA 6.40% 70% $6.,40 Cn Fort Townsend 0.98% 11% $0.98 J 06 rs o n Tr a ns it, A u t h o r ity 0,190% $0„90 Jefferson, County 0.,73% 8% $0.73 JeffCom 10101% 1 % $0. 110 TotalTax Rate 9.10% 100% $9.10 Financial Sustainability Task Force Draft Report to City Council Page 24 of .31 State, Levies (School) L cad hool City of Port'Townsend County CLJ.rir,ent Expense* Hire D tris f Part of Townsend Emer,gen,cy Medical Services Pubhc Utility Di trlict Hospital Dstr ct Total ,$2.734 8 $820 $2.026 21% $608 $1.5678 16%, $30 $1.21.78 13% $128 $0.999 10 1 $0.521 % $47'0 $0.425; % $156 $0.0815 1% $0:0399 A $365 $9.6120, 120 100%** $2,884 'includes Mental IHeelth, Veteran's Relief, DevellojD rental Disalailities "Totals May rIOt SUM tri 100% due to rounding IIII Leven of service is a fWI tired of 2 I[DdlMary factors: The arnouint of servk-es pairuavi rrl (w Ioiu-lo is in tuii a rr fi_aIrjjj- 'tiujrj of the cost of service an ,,] the budget for serices) The number of people r_envh ucp rir�iuves, IIINI Parks exai nlslle:: 1,000 acres of parkland 100,100 resident-, 110 acres per 1,000 residents 1,000 acres of parkland 125,000 residents 8 acres pear 1,000 resiideints Keyfelllr:eawaye Illuncuivasoiun rlllw # imesi euitts uieceiiiviiiuut seuu°voices WiflIOLA iiincireasiiing, r,llly atyvevtuiat of seuiwuicee llxii�'ovWed decireasesyllive Illlevvelll of seui°°vvoice t ui° rlllhe e uusuiTittiniiy . �4 Financial Sustainability Task Force Draft Report to City Council Page 25 of .31 IIII oil 110.1 Mal SERVICES PIROV]DED HY"rHIE CITY SEII PIROVIC111M BY AEFFIERSON COUNTY Development Services: Planning, Assessor: Assessment of real property permitting, inspections Economic Development. Business attraction and retention General Government: City Emergency Management: Disaster planning, mitigation, and recovery management, Ilegall services, finance, Environmental Public Health: Water quality maintenance, preservation of open huiman resources, IT space, per -miffing ofvwaste systems Library. Library services Municipal Court. Processing of cases and colllection of fines IParks., Recreation & Community Public Health: Communicable disease management, family health services, Services: Park maintenance, irecreationall activities SIEII MOVIII 113YOT11I EiiI Police. public safety services Public Works. Maintenance of physical Electricity (via Jefferson County PUD) infrastructure and transportation systems Fire prevention and emergency response (via East Jefferson Fire and Rescue) Solid Waste. Garbage and recycling K-112 education (via Port Tovirsend School District) services Part maintenance (via Port of Port Townsend) Water/Sewer: IDriniking water, sewer Public transit (vis Jefferson Transit Authority) treatment services 911 services Rvia Jeff(--om) 11MIM4111MMMINIMBIWAN FOMITTt nM Police Pul-Aill: Works Pomks, Recrerific,ii, ond Conirnunity Services Manning and Conirnunity D eve I cq,)n-tent tilal (v Y Adyninkstration, Firionce, cind I FUNDING STRATEGIES AND PEER CITIES on Anacortes Yes Yes Yes** Leavenworth Yes Part of a park Yes service area Port Orchard Yes Yes Port Townsend Yes Yes Pbulsbo Yes Yes Yes Sequirn, Part of a park Yes Yes district Financial Sustainability Task Force Draft Report to City Council Page 26 of .31 Select Fax and Noin-,I�)(Reveintge l'.)pfirlms General Purpose Tax Revenue Options General Purpi 'r.p., ty tax increase - temporary, P—ran."t cu mrited purpose Water, Sewer & Stormomatei Utility tax increases Electric and Telephone B&O Tax General Purpose Non -Tax Revenue Options General Purpo Charge lease nines for City Sauce at Mtn. View/City Hall Increase reserve forscl balance requirements, Re -instate Meet Peplacernent Reserves . ith ane time funds Estai a Facilities Repair Reserye with one time funds Currant ant subsidy supports --mis, Sustainable Services and C.,nm.i Sustainable Seryces and C.—nity Sustainable Ser,ces and C.,nmurtity Financial Sustainability Task Force Draft Report to City Council Page 27 of 31 General Purpose Non -Tax Revenue Options (continued) Transportation, Roads, Trails, Tax Revenue Options Transpor to lion Benefit District Could fund no -net loss or, sales, fax —huncroo—nix No sing, r" g—e-j f I b Sales tax available G 0 years with indefinite number of renewals Impacts all pri,ch—s May r'equir'e voter, app—al For transportation protects In. of loscil ont-11 and " --j- fund. C..ld be Transportation WoAd grow with Can be Could fund no -net loss or Op—honsid and C-4.0 iod—d ,,-ke, F- .—,e ffick.ont, b.t rroy For transportation Benefit District enhoncinerreirls 0.1% $275,000 increased ecorionrc indefinite number of m. y c' t I- Ngi—ing oubrus (oe' -11 I -e l"'al o'ut"A and sales tax No, A o.ffi C Ind, of C"'.'il ."d C Ity In rin.gil Ma Y i hrtawm Service, niw,,u­d� Snill req-- public pr . -ss ass,,cion-1 N/A lalb., n."M" f"' 'nly d—,ol— en'# nionsige.ment. rfl, key featriore, like non, given ­keP pe.cffic Froblenrc rud-hug ... in pubhr n-fi,oced toorp-toH,,n Sarre fee for all For tran,l—trati— Benefit i enhanciriene"Is -ba, rind n—i fl—l' in, � o—, Al- .,,.Id reqw,r, inill il projects vehicle license fee -n.& concrg­(o-). '.. renewals Son— O—rho.d. $5,000/hcu5ing unit x,i Growth could be S ­ng, —deternrined- 50 units per year = reduced by attainable Ope-t-noui andt.fl.,ed ­mcn, For Nor fikely . c ­t —ing C—can, lark ct -Y >tt be 4", P"'g-on, A. N.q W. A staffing For culoil.1 pioicls Co."oll ssnd Courry or "W, May h ­ at coot ­f..d(Still rrjui­ nio-rog—erit. isislorf'c F-ser—fi.. N/A give,, ob- cus,ket ."ufl dl Y ddfl— nr'.1igI."ew in P"[A" 'Nufl—t—I specific to the fee - To ari,p-totran housing gooL would need to be market rate (75 pervoter strategy is achieved. Ii uol and approval Sri— o—h-A rur.& 9".k. ................ . ........................................................................... justified by study for year), then growth in ...................................... ................. Olp.,an.oai end ti g, rnd.f­nv,od be C—i-C p"lice Req.ire, ..dysa So. C.n,e,n .-r lack f n"ry Rurol ­,­ N', g".'unt", "I Ocrffioont�� Could fund no -net loss or (­­ it cnd C.—ty toro hro— '�­kro� P"h6ug —c"hood, quJisn—ni, ciml N/A gr,en obo, rcoudi an—fl,", l", drydk':C.Iblc:al'Y INN 6a I's l g I,,il C.. other puiernal enhancri-renents Improvement plan pc,ofic p-ble.- owners approval specific to the bond b tween .,ban and ............................................................. ..................................... ............................... ....................................................................... ---------------------------- ------- va'gLMA! "6� cl--d a,l., dW W �j Delcunarter report, Wotid resift o . (CLEO Corperative gap of eo 5400k d con.unilly libercern,u4 C ­u,00 .Ioro,y on" ... tl,.i of PI .service, - Lib,cry b—ol "n t—ing —tir'sty S-wouti f"o 6". City finan—, Mony oi be Mairroms access for C c'ol -1 Clyu'po'�� oliqns fk� f City and C --fly, no g--1 N/A Jeffe—on County County to Inff—,", C"unty fucd ,,b,Ay of Ike suunicabW fo, library Lii,ra,ol y —ia,u, (ii—od, uty by "o'king hin—Y Library (No­ub- 200 t) lob -,y In Vh, Uu," may t::,j +*ff­ 90 , rike I —'rel— 'e-oc— require general fund for -runuonly confilbur-, due to, hl M.,y I -Ir, so.mlr rook Majorhak" coc—", li., ror.offlen—c, C 1,-t Pcirk Ab-ni cvea tong a irierso, Savings coi r—At in u,, $.o.oncibl,- f,o til Cny you� Cono,--n dc,,fidecd­ Could pcork, dimoa, c—ld nc asr in P—Monal C­xil -d C.-ty S—w— - "A" "Hici­'y of ­0sAs— e Sl per N/A finco-o, Mny mA be ability h, Ill ile"ni"r, -p-d J�ll Co. vustcun.Woe fi,r po,ks_ n—, park,, or, fl- ay a, C- F. --tic-ul po,cr#,000e% -nfi Jeffe—c C_ Transportation, Roads, Trails, Tax Revenue Options Transpor to lion Benefit District Could fund no -net loss or, sales, fax —huncroo—nix Wouild grow with 0.2% $550,000 increased eased economic development Sales tax available G 0 years with indefinite number of renewals Impacts all pri,ch—s May r'equir'e voter, app—al For transportation protects Sales tax available Transportation WoAd grow with Can be Could fund no -net loss or far ➢ 0 years will Impacts all For transportation Benefit District enhoncinerreirls 0.1% $275,000 increased ecorionrc indefinite number of purchases implemented without Fir oJects sales tax renewals ­t., ppr ... I Sales lax available I ransportclion Can be Could fund no -net loss or Won Id grow with more for 10 year s with Sarre fee for all For tran,l—trati— Benefit i enhanciriene"Is $20 fee — $186,000 vehicles registered indefinite number of vehid- owners inill il projects vehicle license fee voter approval '.. renewals $5,000/hcu5ing unit x,i Growth could be 50 units per year = reduced by attainable $250,000 per year housing InceMtive For culoil.1 pioicls Impact Fees sti ateVy to current levels of program for additional Can be Impact Fees ­hr.ve attainable develornent. $5,000 units. If all new units are Ongoing until Inrpcicts specific implemented without specific to the fee - To ari,p-totran housing gooL would need to be market rate (75 pervoter strategy is achieved. s." approval (Ir—org, streets, parks) justified by study for year), then growth in nor -motorized --nue goes up to facilitte, $375,000. Improves and Could fund no -net loss or Based on Capital Impacts all property Requires voter For Loptol propch Capital Bond One time money maintains enhancri-renents Improvement plan infrastructure owners approval specific to the bond Financial Sustainability Task Force Draft Report to City Council Page 28 of 31 Parks, Pools, Public Facilities Tax Revenue Options Metropolitan Fork Dist, id Could fund no-net loss or $0.75 per $1,000 = Subject to 1% Ongoing Impacts all property Requires vc,nm Far park projects enhancfrnlone^nt°w �$1,60U,0f,� brktgetary gYawtl7 owners fippKavo Property tax '.. Subject IQ I% Parks and Could fund no-net loss or I Pacts, all property Requires voter For parks services, Recreatdon 6Rstrfctt b year levy enhancemenents budgetar y growth; Limited to 6 years owners approval Ilmred term ' limited to 6 years Parks, and Subject to 1 %......... Could fund no-net loss or Impacts all property Requires vbtcr For parks services, Recreations Service 6 year levy e11hGrlCenien@nt5 budgetary growth; Limited to 6 yearA Ow15er5 approval (Im1ed farm lnrea i limited to 6 years Pubjic Foddlities would grow with Could fund no-net lass or Impacts all Requires voter For a regional District 0.21 = $550,000 increased economic 01enhancemenents sales tax ' development purchases approval facility C ',.. $5,000111VUSIng unit % Growth could be 50 units per year = reduced by a'tta b11676 @ $250,000 per year housing incentive For capital projects Irnpact Fees Impact Fccs strategy to current levels of IF, gram for additional Can be Parks /Open achieve aroorrabje develoment. $5,000 units, If all new units arcImplemented OngoingUntl'ul IrnpactlS SIYeC'iflC' without speG'uflc to the foe strategy is achieved, users [housing, streets,Sp Gee pausing goal. needI,, would need to be ''.... mcn�kat rata 175 per vote, approvcnl parks) justified by study for year), then growth in ''....... non-rriotorired r-onup goes up to ''.. facilities $375,000. Current fees. $1001, Current cost to run Can be Fees must be Gltr' bated Impacts 5IYeC'if lC' l' Specific foO&M of Pool Use fees existing (Tool, $600k directly to user would grow with use Ongoing users Implemented without faci0'ity Vbte1' Clppl'bvC1 ''.,. Increase fee,, $1001, Housing Tax Revenue Options Financial Sustainability Task Force Draft Report to City Council Page 29 of 31 Housing Tax Non -Revenue Options Ong, �,narsl ,,, Continued development of provides. ­ needed - ti City inticrti,od 1.", , ,.,no warkfarce ,n, Inflationary tionry 9, —th attainable focusing is to attainable housing. Require., C-rocil Support., " iti housing lEvamv Provides housinq housing = $15,000/yr for p.t.noi.l. Also there .cl far a —tainicil Ni or, .4 pausing. .1i containable housing yst.) 150 unrin, Other ucm one timr, I- revenue 'o munity IRD eed' tangible community value Red-. renmant Estimated market value Could be fur affordable $2,000,000 bas -1 an Sale of Land —n-4,in potentially far Will Dv.I..p.nt housing _'I t' d 20 10s with net No growth p.ricurtal -1- of $ 100,000 housing. Expansion of sewer far 100 aoros ox isting include fin."'i"l, housing and industry. Equitable cfi,mr.l. P.1cont6i to P.I.Mial UGA -1p. Olen Cove UGA - 300 ..... .. I'liti.n.11 More efficient wilbron coming P011CY, le housing and light industry. Expansion services hosed on Estimol ed annual S 1 nor in Perceived g&nTrlfkoIln o,sisting d ... cipuniont tactical infill revenue growth a- 20 pattern, and squosmucto for 100 miles of ,ccer, you, period Ong, �,narsl ,,, Continued development of provides. ­ needed - ti City inticrti,od 1.", , ,.,no warkfarce ,n, Inflationary tionry 9, —th attainable focusing is to attainable housing. Require., C-rocil Support., " iti housing lEvamv Provides housinq housing = $15,000/yr for p.t.noi.l. Also there .cl far a —tainicil Ni or, .4 pausing. .1i containable housing yst.) 150 unrin, Other ucm one timr, I- revenue 'o munity IRD eed' tangible community value Lowers tax burden on Could be fur affordable Council decision, Seed fund or use residents Infrastructure. Est $330,000 per year for Will Dv.I..p.nt iss"'ghb., hcri No growth p.ricurtal One to.e housing. to ll for ff.rd.blo ,cancer,:,strategy include fin."'i"l, for -ad 1400 unit, Equitable housing right naw b-- of li is or density to. coming P011CY, le considered , burden uc,du,ficus at 20% Apartment, "," all Perceived g&nTrlfkoIln ionve'lu,ent is tactical infill High growth potential with for 100 miles of ,ccer, Requires C.-ty (C., now, unit count per wifify t-, R&O, sales, and with incl eeasar business Cost I. our and City C. -i G'O.Al with time piroperl tax, Need business could inc Requires pproval, Requires Sul ts ll wbintea plan to drive UGA UGA change and jobs density f., most fircert with ul 5ervices. Also pi f. app, -d by ,stages more family wage jobs, C...— Ong, �,narsl ,,, Continued development of provides. ­ needed - ti City inticrti,od 1.", , ,.,no warkfarce ,n, Inflationary tionry 9, —th attainable focusing is to attainable housing. Require., C-rocil Support., " iti housing lEvamv Provides housinq housing = $15,000/yr for p.t.noi.l. Also there .cl far a —tainicil Ni or, .4 pausing. .1i containable housing yst.) 150 unrin, Other ucm one timr, I- revenue 'o munity IRD eed' tangible community value fatal 'j'_5 oorni ­11sity is $450 mo for the P—lds, new and dAy at $ 1.3 rori of Sul close". "ddifi-cri Job,. Make, commercial tend space Corn�mercra11 use of -um."Aly f325 ac- . Business Growth .-d P, l Vitality Far Example Room, to In —ni dri 1.1nori—i"I supports better services. cxvity on Land by 20% which gsur.rci $640k .ddirricural sr¢lrrual ...muse. High level of stutcrincibo if housing I, mfill —pared Conical nerd far to 'p'a`,L On going backlog Won, l going with Infill is q.t.blos. Could Plaroniti Ye,,, d.pendmig air new jugr 11 ude l".9, requires toPl., -ri 0 ­ needs, dirso.l., and d.uy end 11 vary withk d gfl�a ons achieve attinable Commission and City roraw cal -city to build. "fi.structure and i,mdio Need to housing needs. Cannot —i—rcol address building cyd. Problem. Cy6k, based ori economy. However, on ­,". very Go can -a, Lowers tax burden on depending community state fax structure. residents Infrastructure. Est $330,000 per year for Will Dv.I..p.nt We need 75 units per new _surn. ss.,I.t.d Snw.gy year or 'o—oors going wirfY C6RY51rt1C'tiGl'I 44'11@Y5 Y('1% include fin."'i"l, for -ad 1400 unit, und pir.p..,Ity to, Ake, marketing and right naw b-- of li is or density to. coming P011CY, le b.'l'ag of not enough burden uc,du,ficus at 20% Apartment, "," all ..of, being ­,unuotud ionve'lu,ent is tactical infill t ver the last 20 yeu- for 100 miles of ,ccer, Is2 o.bisfied as th. (C., now, unit count per and lu'd lablW 1". year is 50) fatal 'j'_5 oorni ­11sity is $450 mo for the P—lds, new and dAy at $ 1.3 rori of Sul close". "ddifi-cri Job,. Make, commercial tend space Corn�mercra11 use of -um."Aly f325 ac- . Business Growth .-d P, l Vitality Far Example Room, to In —ni dri 1.1nori—i"I supports better services. cxvity on Land by 20% which gsur.rci $640k .ddirricural sr¢lrrual ...muse. High level of stutcrincibo if housing I, mfill —pared Conical nerd far to 'p'a`,L On going backlog Won, l going with Infill is q.t.blos. Could Plaroniti Ye,,, d.pendmig air new jugr 11 ude l".9, requires toPl., -ri 0 ­ needs, dirso.l., and d.uy end 11 vary withk d gfl�a ons achieve attinable Commission and City roraw cal -city to build. "fi.structure and i,mdio Need to housing needs. Cannot —i—rcol address building cyd. Problem. Cy6k, based ori economy. However, on ­,". very Go can -a, sustainable based on WA depending community state fax structure. cir-fifo. far increasing Carni usfivity is what Z—Ing is the key Depends a, job type, l criclivity and delves c loy, -l Lodi-eing This oni prof—l-al t—l-, small bumiro—, manufacturing, .11. R.ac,­ dedicated ,d � " ,crying 1.1, with in-Aryout in � communify needs is economic development and the key strategy crt.qy for Iscuarng I growth. Financial Sustainability Task Force Draft Report to City Council Page 30 of 31 i W—I of ­rvike Hug. improvement in Z—Ing is the key Iri return ,,, High revenue potential for High gfowth potential equity ii housing. Support Market for housing and market at. 'i,carmi if MF development can Creates long term finciri Apartment, "," all driver far moking, ionve'lu,ent is M.1hol—ly Housing "I"u'l—nin. due 1. due to ulolus, t—, i tax, Is2 o.bisfied as th. 'usr.muil' City for "i f—pl. of diff—ort lu'd lablW 1". coport"."t Islaxonn", d"i and property tax r. -n— incurnn for unit ar—ton. of life and don't 51 "i nui ,stages C,,unil de,nrorr To-, ch -....not.. Reduce or I 1.11P., WA Yal1S111g Not estimated yet. May Equitable use of fle eliminate if-otoriedt density, J- eases cost of be a net zero of housing Depends on housing N/A right of way for housing Council deason Growth dotentalfor parking density d.visopmourt housing density TquhementS sf,00t,uMntenanco dorulty Is achieved. par is ... 5 Goal to m—ini development of new altairobl. uut5. We growth pauc,rildl f., 150% AMI Muhl lin—ec,ise anal nabifirty of oevonno rouritral , but need 60% of all is— M-kilog and lociu'Mg – >1 176 Family To. hcu"u'v 1, .", 120% 1. un"If.'s i fax unit,, be attainable N/A Make, bar j ­o,rablo ""ay elli ui out of 150% AMI qualified costs to rest of property far more people. ExemptionFii h—oll tax base de'vI.'I.pm.mi I 4AB units needed (lased Based an Dept. of by 2044 C.-mence 20 y, J" ol-Imit Financial Sustainability Task Force Draft Report to City Council Page 30 of 31 Select IResources of itelevalince White Paper: Exploration of Strategies for Supporting Infill and Affordable Housing Related to Infrastructure Development City staff produced a white paper that is related in particular to the housing component and briefly referenced in the report above. The draft white paper, dated May 3, 2023, and presented to the City Council Infrastructure and Development Committee, can be found here: https://cityofPt.granicus.com/M eta Viewer. php?view id=4&clip id=2663&meta id=215676 Housing Initiatives A general overview of City housing initiatives can be found here: https://citvofpt.us/engagept/page/housing. Streets Initiatives: Comprehensive Streets Program A general overview of City streets initiatives, including the Comprehensive Streets Program, can be found here: https://citvofPt.us/engagept/page/comprehensive-streets-program. Parks Initiatives: Healthier Together (Pool) and Envision the Golf Course/Mountain View An overview of the Healthier Together (Pool) initiative can be found here: https://citvofpt.us/engagept/page/healthier-together. An overview of the Envision Port Townsend Golf Course and Mountain View Commons can be found here: https://citvofpt.us/engagept/page/envision-port-townsend-golf-course-and-mountain-view-commons Video Series A new video series providing a brief overview of core services and the three priority areas of housing, streets, and parks can be found: • On the City Facebook Page: https://www.facebook.com/CityofPT • On the City YouTube Channel: https://www.youtube.com/(@CitvofPortTownsend/videos • On the City website: https://cityofpt.us/engagept/page/videos Financial Sustainability Task Force Draft Report to City Council Page 31 of 31 U I�y (�� m n o o O cn N o of - o m O� m ry m v r m m O m �1 vI M N n' O tp O O r` O N O1 O1 two. m N c y r«a u u« o o c �o x a - aa a m ry m a ti N m =�E YE a o w Z u u a n rn o o �n m o o v ar o o o m o m m o v v1 m v o N m ro u N O c OJ O rn 06 o w r�fr H M cy cy Ol v1 o m ry ti N tp Ol vt O m� m 0 O O 0 O i0 0 10 N r` r` to m f` a M N rn� rn o a r ti ti �r M a r a ti m a u m N ti a co r• r• o v' o o a : o a a o m r• a o o� a o m 1-1 o o : o 0 o v 0 ry a co m u o0 0� yr rn o N o a3 m 0 o o o N � N co o v m a o M N vm�i o ti ti m � a ti ti ti m a 001 O 1 O Y,O r` O O V p p M N oc M O Ol C w' YO O W O h O N O W CO ti r: O � � UJ lD M v p N lYl N OJ ti � � O I� O O1 O N O O N O O V m V V O O Ol O1 O1 M lO vl 00 Oi vl O m ^0 Ol � v1 O N O N r -I O N ti ti m N v O ry O V lD r, ti Ql O O M O V O V N Ql f a o m 0 0 o N N vt tp tp ti a ll� � O 0 0 M O O o h C O O Or O 1 O O c C C O v1 01 m O O O O O O O 0 0: c O O I N c co10 O O co a o O1 l0 l0 m m O O O 2 1 UJ m n °c N N N N N N V � ? 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N M C � : O - m o -o E v L o -o v O O O o o o w v O O o o o o o o o o o o o o m m o : O m 0 m a V V1 v v N a o N o m o .� w m r m o o vl Nl N O N �v ar v N In o N � N n Inry o o0 r vi°i N l� o o m ll: O N N� m m ^ O m N m Vq o N m m o o d ti N co N co m vl mLq � o m in in ti a a m a ti m m; r• M� �O o n a in o m n ti o m m m q ti co 0 O O O m o - m � ,� 1- w �n vl O ti o ti o m o o o o o o o o ti vl � o o o o o : o O ! o o_ o O o w xm o� _ - _ o 00 o a Y E v o s n .a LL - y va _ c O O lw c O - v "y o v o o Oa ; -0, o a o t o`v O i v v y W O o `° o o w v N C Z., °-00 o x v ^ a w O v v L u� u w m z 3 O m m o N > 0 0 '^ o N C¢ O o m o U z m 3 O p o o m O j 0 0 0 > T 4 �% Y N z C'� Z in % O m j N 00 0 0 z oo� v ,v, o'Y Rzin woo 2 a oy x -a m = aZc o° o a o w v r Vvw ao 0 EuwP J¢ n ; o aw� zo E U +vzooowy m c ' - z _o _0 30oZZ 1 v r w o ZD Z --= ¢o -nv rww C Y L L L C T C C C C C C T T w H H T C C T T m m n o v as �n m w m ai v w w w m w ry o ami m w N N of v io �n v N ai m ry r� m w n N ai o n v n r� io m m o m o a v m N Q oo v N N Vml V n M � v r• w M o0 w m o r r v N N c o o ^ o ro N m a N N v o in m o m w m vi ri n a a ry a .1 N ry o m v w M m o w o 0 m r. o io 0 n a v ni v m o r m ry a ti N m o o v N w ry a m r m o ai v v m m m w Nw Z 7 V N ti l0 m V H F w a 0 0 m aro v n 01 C31 n a � 0 a O o a - O p a 0 O o v � _ D — a > O O > w o o y o 3 Q oo v N w N a v a 3 3 J z o v N D O Z C % 0 O — m o a o o 0 c z 3 Y a J o z O z eD z �. 0 — — z Z 7 Z l7 m a H H H F w dv n o 0 N V O m M vt O O l0 O V O rn o N o i V O aJ a) O N cD m p Pi N W ti N � � ro ro d r n o ry m m N O d ti a v o N ro ro u n O O H H O n a V ro a N m C o a a o N ro a m ti ti a la O N O M Ql O N ry m N m iQ O Q rn o w v o 0 o Q w m rn I N O if � O � O N M m� iQ O a n O n N O 0 0 a o o a r rn o n d- r o c r• O r` v1 aJ M o rn o 0 o a O O al V m O v f n o of io 0 0 m o o a OR. 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