This editorial was published by the Walla Walla Union-Bulletin.
Crafting the city of Walla Walla’s two-year budget is always a daunting task. It will be tougher than ever in the midst of the COVID-19 pandemic.
City government, like state government, bases its two-year spending plan on projected revenue (tax collections). Right now, given the uncertainty created by the pandemic, it’s challenging to anticipate from month to month — let alone year to year — how much sales tax will be collected.
Given that, it would be best to take a fiscally conservative approach to spending over the next two years.
This spring, when many businesses in Walla Walla and around the state were shut down in an effort to curb the coronavirus, sales tax collections plummeted. But by this summer tax collections had rebounded, which was reflected in the statewide revenue projections that reduced the state’s projected budget gap during the next three years from about $9 billion to just over $4.2 billion.
It’s likely Walla Walla is following those trends — or doing a bit better.
So, going into the city of Walla Walla’s budget process for 2021-2022, the projected revenue isn’t as bad as it was. Yet, it’s still very concerning.
Right now the city projects about $800,000 to $1 million less sales tax revenue for 2020, all related to the closing of businesses. In addition, the cancellation of parks and recreation programs resulted in the loss of $750,000 in revenue.
That makes it highly likely cuts, perhaps deep cuts, will have to be made.
But this situation could have been even worse had the city not imposed a hiring freeze.
City Finance Director Jean Teasdale said 10 vacant positions were not filled this year, saving $771,400.
Teasdale said it is anticipated the city will have about $5 million, or 13 percent, in its rainy-day reserve fund.
That fund has already been tapped to get the city through the current downturn in tax collections, which is why Teasdale said the reserve fund is a “little low” right now.
It would, of course, be best if the city could hold off taking more out of the reserve fund in case an even bigger downturn in sales-tax collections occurs.
No, we don’t want to even think about that, but we must — and so should the city council.
Right now, city officials are not planning to push for any increase in property tax for 2021 or add new taxes or fees.
That’s wise. The public isn’t in a mood for new taxes as many Walla Wallans are struggling with their personal finances in this pandemic.
Even a tiny increase — a few bucks a month — would be a lousy move symbolically.
The path forward has to be through cutting spending.
This is why it is important that citizens let city council members know their priorities before, not after, the budget is finalized.
The public will have an opportunity to comment through the budget process. Public meetings — albeit virtual — will be taking place this month into December.