In what will likely be his most important job of his 71 days as mayor, Mayor Tim Burgess delivered his proposal for Seattle's new budget to the City Council on Monday, at once acknowledging his interim-status while also pledging to push the city forward.
While the bulk of the 2018 budget was drafted when former-Mayor Ed Murray was still in office — city Budget Director Ben Noble said Monday "99 percent" is the same as what Murray would have delivered — Burgess has had a week to put his own stamp on the $5.6 billion document before the council gets its chance to adjust and approve.
The gritty details of the budget are buried beneath more than 800 pages and thousands of line items and many of the less-flashy specifics will come out in council meetings over several weeks. But there are several immediate highlights, including a proposed city-run retirement program, more money for police accountability, funding to increase recruitment of firefighters, an expansion of the city's homelessness funding, and money to enforce domestic-violence laws.
There's also a not-so-pleasant surprise the budgeting office needs to plan around: litigation costs related to lawsuits on behalf of or against the city will be $13.4 million over what was budgeted for in 2017, $12 million of which has already been spent and an additional $1.4 million to cover costs in the city's pipeline.
The budget will also include an additional $500,000 for victims of sexual abuse, a clear nod to the pain caused by the accusations against Mayor Murray. As a council member, Burgess was quiet on the allegations until a fifth man, Murray's cousin, came forward, prompting Murray's resignation and paving the way for the appointment of Burgess.
Burgess sought to reach out to abuse victims in his speech Monday. "To survivors, I want you to know your city government stands with you," the new mayor said. "We will support you. We will walk with you on that path toward healing."
The $500,000 tagged for sexual-abuse victims will fund more outreach and referral services for survivors, as well as advocacy work.
The proposed retirement account would benefit approximately 200,000 private employees in Seattle who do not currently have one. The burden on employers is low — they would not need to contribute any of their own money — and would only require they enroll employees into the city’s plan and deduct payments from their paychecks. Employees can opt out if they choose.
Workers will not likely have the option for several years, however; Burgess' budget sets aside $200,000 to conduct a feasibility study and legal analysis of the proposal in 2018. There appears to be some question about the legality of the program, but Burgess told The Times he believes he and City Attorney Pete Holmes have a path.
Burgess' budget also continues what has been an upward climb in funding to combat homelessness, bumping homelessness funding to $63 million, up about $3 million from last year and capping a 60 percent increase in funding from 2013. This year's funding will go primarily toward adding extra outreach workers to people living in their vehicles, as well as making permanent a coordinated outreach center for people living on the streets. The funding would also go toward better tracking populations living on the street as well as performance metrics for providers.
Burgess' budget will also provide $162,000 to enforce a recently passed Washington state law that mandates perpetrators of domestic violence must surrender their firearms.
As a former police officer, Burgess has always had a strong voice on matters related to public safety. That was the case again, Monday: He pledged to set aside money to expand the Seattle Fire Department's recruiting class to fill longstanding vacancies, add a new ambulance and fund a backup dispatch center.
For police, Burgess continued a funding plan, begun by Murray, to add 200 more police officers by 2021 and bookmarked money for more 911 communications center staff, which has been plagued by staffing and operational challenges.
Burgess also set aside money for civilian-led police accountability measures, proposing an additional $150,000 a year for the Community Police Commission to add staff and $1.5 million for the soon-to-be-established Office of Inspector General.
Thanks to the recently passed tax on sugary beverages, Burgess got to play around with an additional $14.8 million in his budget. That money will be set aside for education and food-justice programs, including a program to match food stamp dollars spent at farmers markets, the 13th Year program to offer free community college to graduating high school seniors, the city's universal pre-K program and other, similarly focused programs.
The less fun part of the budget is the $13.4 million dollar left behind by high litigation costs. Some of these overruns can be seen in Monday's budget proposal; others the council will have to confront when it passes a supplemental budget next summer. Either way, this budget was written in anticipation of surprise deficit.
Last year, the council approved just over $11.25 million to cover costs surrounding “anticipated, pending or actual judgments, claims payments, advance claims payments, and litigation expenses incurred while defending the City from judgments and claims.” In other words, lawsuits, either on behalf of or against the city, and their attendant costs.
But the actual expenditures will be closer to $25 million.
In an interview, Noble called this the "biggest single financial challenge we faced" in assembling a proposed budget. Fortunately, he said, revenue last year slightly outpaced forecasts, which means there won't be significant cuts to existing programs. "It’s more of a question of what was not included in this year’s budget," he said.
Additionally, Noble said department heads have been asked to underspend their budgets where possible, which Noble said was "most specifically attributed to this" — the $13.4 million. That may result in vacant positions going unfilled or certain supplies not being ordered.
Despite the large tag on the city’s total, $5 billion budget, the vast majority of those expenses are eaten up covering basic functions of city government, specifically utilities and transportation costs. That leaves less than a quarter of the total budget for the general fund — $1.2 billion last year — which the council can tweak. But more than half of the general fund is spent on public safety costs; an additional 15 percent is on administration costs.
Subtract all of these expenses and suddenly an unexpected $13 million overrun is significant.
The overrun is most likely the result of several things. The city, for one, is fighting several high-profile lawsuits, including on behalf of its income tax ordinance, the effort to allow Uber and Lyft drivers to unionize, and a suit brought by the ACLU against the city for its policies on evicting homeless encampments, although Noble said those weren't necessarily the most significant drivers of the spike.
There also could be several large settlements that have been either recently resolved or may soon come down the pike.
Noble also says officials will look at how the City Attorney's Office is using outside counsel, which has the potential to be more expensive than in-house work. "I think there is an opportunity that we may develop a sense about whether we have the right balance of in-house counsel and out-of-house counsel," he said. "There are certainly high stakes cases where it makes sense [to bring in outside counsel]. But I also need to make sure we have a good roster of in-house counsel." Examples of when the City Attorney's Office have used outside legal help include the ACLU case, as well as lower-profile cases, such as that of a man arrested on Aurora for soliciting sex from an undercover officer.
Attorney Joe Groshong with the City Attorney's Office acknowledged Monday the expenses for 2017 are high, especially because most of the costs are coming directly out of the general fund. And while he said that outside counsel costs for the year are not altogether different than years past, he did say the City Attorney's Office could benefit from more lawyers in-house.
But Groshong added he's not overly concerned about the causes. "It's important to know that sometimes bad things happen in bunches," he said, blaming the budgeting process, which is built off of five-year averages, more than any one thing. "The way that we budget for the judgment and claims fund…we’re either going to have money left over or not enough. It’s about 50/50 as to when we have money left over versus when we’re over budget."
Noble had a similar take, saying the city's model for predicting litigation costs based on five-year averages is clearly flawed, susceptible to being blown up whenever several large cases crop up at once, especially if litigation costs have been relatively low over the previous five years.
In the future, Noble said, he'd like to tweak how that pocket of funds is allocated by becoming more attuned to the city's pace on litigation. Noble learned of the overruns during the summer, but it may have been helpful to know even earlier.
This story has been updated on Sept. 26 to remove a mistaken reference by Director Noble to a potential cause of the increased judgement and claims costs.