Budget Committee Meeting Session I 10-13-26

Good morning.

The October 13th, 2026 Select Budget Committee meeting will come to order.

It is 9.31 a.m.

I'm Dan Strauss, chair of the committee.

And we have a couple council members excused until they arrive.

And until then, clerk, will you please call the roll?

Council member Saka.

Mr. Foster?

Here.

Council President Hollingsworth?

Council Member Juarez?

Council Member Kettle?

Here.

Council Member Lynn?

Here.

Council Member Rink?

Here.

Council Member Rivera?

Present.

And Chair Strauss?

Here.

Seven present.

Thank you.

Today we have on the agenda an introduction and overview of the budget process to date, general fund balancing and sustainability analysis, a presentation about voluntary separations, and then we'll move into analysis of departments.

First, the Office of Planning and Community Development, followed by Seattle Department of Construction and Inspections.

Before we begin, if there's no objection, the agenda will be adopted.

Hearing no objection, the agenda is adopted.

I will be calling for a one-hour break today at lunchtime, hopefully around the noon hour.

We will also have a proclamation for signature today.

We have a delegation from our sister city in China, Chongqing, that will visit us at about 1.15, 1.20 p.m.

today.

We'll have them come up to the dais in usual form to take a photo, but probably between presentations when we have the full quorum here, that's when I'll ask for signatures.

Do we have any questions before we move on to public comment?

Seeing none, I am going to move us into the hybrid public comment period.

Public comments should relate to items on today's agenda within the purview of the Select Committee.

This is the second of six public comment periods, and we've had one public hearing.

We'll have another one during this budget process.

Phil, how many speakers do we have signed up today?

We currently have six in-person and six remote speakers signed up.

Wonderful.

So that is total of 12, which means folks will have, each speaker will have two minutes.

And we will start with the in-person commenters first, followed by online.

Public comment period will be moderated in the following manner.

Public comment period is up to 20 minutes.

Speakers will be called in the order in which they registered.

Speakers will alternate.

First we'll do in-person and then we'll do online.

and the public comment period is now open.

We'll begin with the first.

folks in person.

We have Chris Tini, Matt Offenbacher, Jason Austin, Jeremy Reblich, Steve Rubstello, and Crystal Ball.

And if anyone else has shown up that would like to provide public comment, just sign up on the sheet here and we'll get you at the end.

With that, folks are happy to line up and we'll just roll right on through.

Good morning, Chris.

Good to see you.

Good morning.

My name is Chris.

I'm a district, I'm a resident of District 6.

Thank you.

I'm a resident of District 6 and I'm a co-owner of Farmstand Local Foods which is a food hub and its warehouse is located in District 1. I'm here to thank the Mayor for sustaining the budget for meal programs and the Fresh Bucks program and thank Hollingsworth and Rink for championing those causes as well as Budget Chair Strauss for facilitating the process.

As a small business owner, I stand behind each member that has business accountability top of mind.

I've been involved in both government, investment, and across the board.

And I'm here because of that.

These programs are the epitome of efficiency and effectiveness when it comes to dollars spent.

The funding itself will be outmatched by farmers' blood, sweat, and tears, as well as food meal program staff and preschool staff, which is part of what we help implement.

In fact, the city's own reporting with UW demonstrated that every dollar that's spent with local farms turns into $1.80 of economic activity.

This funding not only stokes our immediate economy and the job prospects that we are all looking for, but also ensures our city isn't unwittingly held into a food siege by corporate food executives who wouldn't stay with any company if their individual modest returns were on the same timelines as many of our farmers.

These farmers are what bring us that food security and ensure there's both dignity, job prospects, and great things to eat for our city and region.

What more could a council ask for than this effective use of dollars?

Thank you.

Thank you, Chris.

Up next we have Matt followed by Jason and then Jeremy.

Matt, great to see you.

You too.

Thanks, council, for this chance to talk to you this morning.

My name is Matthew Offenbacher.

I'm a resident of Capitol Hill.

I'm an artist, small business owner in Soto, and currently serving as a community advisor on the Arts at King Street Station space that the city runs above the Amtrak station.

This is a funky microphone.

I am here today because I wanted to make sure that you read the letter that was sent to you by over 700 Seattle artists and more than 110 community organizations calling on you to value us as essential public safety and wellness workers by moving $8 million from SPD's budget to the Office of Arts and Culture.

the key part of the letter says that art and cultural placemaking is public safety infrastructure and you might be asking yourself like in this tight budget season where can you find the money for this expense and I have two ideas for you the first idea is the proviso the 13 million dollars from SPD's payroll that they overpaid last year from the accidental retroactive overpayment.

So if you provide some of that, then you can make it contingent on them recovering the money next year and you can reallocate that $13 million.

Doing so would also have the additional benefit of signaling to the public that you're holding SPD accountable and also provide the police department some motivation to get busy with getting that money back.

The other idea that I had for you, I think I have time, is to cut the funding for SPD's police outreach and engagement team.

I have to say for me personally, seeing officers walking around community events with the letters P-O-E-T emblazoned on the back of their flak jackets is uniquely offensive.

And so instead, I ask you to please fund Seattle's real poets, artists, writers, dancers, performers, and musicians who do the work of making our community safer.

Thank you.

Thanks, Matt.

Up next, we have Jason Austin followed by Jeremy Rublich.

Jason, good morning.

And Jeremy, if you wanna line up right behind Jason so we can keep rolling.

Good morning.

Okay.

Good morning, Budget Chair Strauss and members of the Council.

My name is Jason Austin and I am the Program Director with the Meals Partnership Coalition.

I am here today to speak in favor of permanent funding for food access.

I want to thank the Mayor for including $1 million in permanent sustained funding for meal programs in the 2027 budget.

I urge the Council to sustain this investment in the final budget.

and I also want to thank Council President Hollingsworth and council members Rink and Foster for their support of food access funding.

The funding included in the mayor's budget supports an ecosystem of 58 organizations across the city, each one meeting a unique need not served by other organizations.

This funding supports programs such as the Southeast Seattle Senior Center.

The Senior Center is typically the first to spend through their allotment of ADS senior nutrition funding each year, relying on MPC support to be able to feed their folks 12 months out of the year.

This funding also supports organizations such as Elizabeth Gregory Home, a day center and emergency housing provider for women in the University District.

Elizabeth Gregory has seen their meal count numbers increased by over 50% since the closure of the Mary's Place Day Center in 2025. I could go on.

Every single neighborhood in Seattle contains at least one MPC program, working hard to meet the nutritional needs of our community.

Again I want to thank you for supporting previous investments in meal programs and I urge you to sustain this investment in the final budget.

Thank you for your time.

Thank you.

Up next we have Jeremy and then Steve followed by Crystal.

Good morning Jeremy.

I would adjust that microphone.

How's that?

Perfect.

All right.

Hello, council.

Thank you for taking the time to listen.

My name is Jeremy Vrablich, and I am the owner of Cascadia Produce.

We are a food aggregation and redistribution warehouse.

We're actually located outside of the city of Seattle, but do a fair amount of work in the city.

both with Farmstand and with the MPC program along with the Seattle Food Committee.

And I'm here today to speak in favor of the proposed budget from the mayor to be able to continue to support these programs.

The funding that comes from those programs directly affect every single individual throughout this city.

We are proud to be a part of the Fresh Bucks program as well.

We had a retail store, and we've transitioned to all online deliveries on that.

and that program in particular reaching out to people across the whole city to make sure that they have fresh produce, fresh fruits and vegetables to eat is paramount to making sure that we have a safe, secure and well-fed, literally, society.

We were able to interact with one person who, she's an elderly lady who lives towards the north of the city and she only has enough money to take Uber to the store one time a month, and it is because of Fresh Bucks that she's able to go and purchase frozen fruits and vegetables to be able to bring them back, so she has enough to eat for the month.

We've now been able to interact with her and be able to get fresh produce to her.

This program, along with the meal program, is what is really binding the city together and ensuring that we all are caring for our neighbors appropriately.

So I urge you to Please continue this funding.

Thank you very much.

Thank you so much, Jeremy.

Up next is Steve Rubstillo followed by Crystal Ball.

Steve, good morning to you.

Good morning.

I'm here to speak primarily this morning, start with public safety.

We don't got it.

It's been a long, long time.

You know, I keep hearing, oh, manana, manana, manana.

if the first thing you need to do is have enough feet on the ground, and we don't have enough feet on the ground.

After that, it'd be kind of nice to have some follow-up.

It really would, because you have a lot of repeaters, and if you take care of one person, you may take care of a lot of crime.

and that might be a good thing for most of the citizens of the city of Seattle.

I don't think the current mayor was elected because she had so much money to blanket the media.

She wasn't elected because she was really, really well known.

I think she was elected because of the previous mayor, and she may suffer the same fate if we don't see some improvement in the city of Seattle.

Now, I think you've done OK on the camera selection, because they don't have the readers, I believe, in Seattle, which has created a bit of a problem.

But the only way you're going to make that secure is a closed system.

And for God's sake, don't put it on the internet, because if you put it on the internet, you have absolutely no control over what's going to happen.

So these squads could be very, very helpful in picking up your repeaters.

And so first you need to answer the call.

Now, I don't know if you've ever called and had the police not come or tell you it's going to be ours, but it's not a good feeling, I can tell you that from experience.

Now I'm not working down in the downtown area, so I don't need you quite as much.

Thank you, Steve.

Up next we have Crystal Ball.

And then Phil, if you wanna hand me anyone else.

Okay.

In 2022, Democrats broke funding record for ICE.

In 2023, Democrats broke funding record for ICE again.

In 2024, Democrats broke funding record for ICE yet another time.

And we know what happened in 2025, and here we are in 2026 with over 500 US citizens that have been detained by ICE.

U.S. citizens have been deported by ICE and numerous U.S. citizens and more than 60 immigrants have been killed or died in ICE custody.

And yesterday, DHS raided a sitting Congresswoman's house, who is also a Democrat.

Last year, this Council of Democrats broke the funding record for SPD, allocating half a billion dollars for it.

And this year, another Democrat has proposed to give them a 13.8% budget increase, while $65 million is cut from fucking affordable housing.

Do you see a fucking pattern here?

Over the past year, there's been three fatal shootings by SPD.

And last month, SPD murdered a fourth man by restraining and kneeling on his neck.

Once again!

We don't want more killer cops.

Investments in housing has proven to lead to a 27% drop in King County bookings.

You are putting money in the wrong places.

And the community does not want more cameras.

It does not want more cops.

We do not want to go towards KK Kettle's wet dream of fucking minority report states.

Fuck that shit.

Up next, we have Rachel Cotola, followed by Reverend Alex Booker.

Rachel, welcome.

Good morning, council members.

My name is Rachel Cattola, and I live in District 5, and I'm an organizer with the Church Council of Seattle.

I'm back here again today to urge you all as council members and our elected officials to pass a budget that reflects our values of abundance and community care.

I'm in agreement with a lot of the folks here today that we are pro-public safety and we know that what creates public safety is investing in the services and programs and support that happens before a crisis.

We know that policing and surveillance are reactionary responses that can help reconstruct violence after it happens and potentially get prosecution, but it doesn't actually prevent violence or create real public safety that services, shelter, arts funding does.

So we ask you again to please consider how to create expansive and abundant public safety from the ground up.

All right, thank you.

Thank you, Rachel.

Up next, we have Reverend Alex Booker, and then we will move to online public commenters, Rose Legionnaires, Logan Schmidt, Cedar Blue Hoose, Hannah Siff, Stephanie Sismet.

Folks that are not present and need to call in now are Ref Linmark, Laurel H, Julie Chang Schulman, David Haynes.

Please check your email for the call-in instructions.

If your names are ref, landmark, Laurel H, Julie Chang Schulman, or David Haynes.

With that, Reverend Booker, good to see you.

Good morning, council members.

I'm Reverend Alex Booker.

I pastor a church in District 7, and I live in District 2. And I'm here on behalf of the church council and my church as well to say that we are pro-public safety.

I want to make that very, very clear.

We are pro-public safety.

We want people to live healthy and abundant lives.

I grew up in Skyway, so I have friends and family members that were perpetrators of violence and also victims of violence.

And I stand on the side that says that adding more money to a reactive and a Band-Aid as in police is not going to stop it from happening in the first place.

We have too much time on our hands, folks of color, in the city and in this country and in this world.

We need things to do.

We need the arts programs, right?

We need food in our stomach.

We need after-school and summer programs.

So shifting funding to those things is pro-public safety.

It simply is, and it's not that difficult.

There's lots of data and numbers that can tell the story, For someone like myself, I know what that story looks like.

I know what it's like to have nothing to do in the summertime.

If it was not for rotary, if it was not for church programs, if it wasn't for just having food in my stomach.

So I'm urging us to have the courage to not continue to put money toward band-aids, not continue to put money towards more guns on the streets, because that's exactly what that is.

It's in the lost hand.

Let's put money towards our activities, towards our children.

In the story of the feeding of the 5,000, the Gospel of John, Jesus took a young schoolboy's lunch, a child's lunch, to fund the rest of the world.

And that's what I'm asking you all to do as you construct these budgets, as you construct these things, is to lean on the children.

Think about the children and what they need and what they have, and that will lead us down the right path toward a more moral budget.

Thank you.

Thank you, Reverend.

We're gonna now go to online public commenters.

The only folks that are not present are Ref Lynn Mark, Laurel H, and David Haynes.

If you've heard your names, you need to check your email and use the call-in instructions present.

With that, Rose Legionnaires, Logan Schmidt, and Cedar Blue Shoe are the next folks who are present.

Rose, I already see you're off mute.

Thank you for being ready.

Take it away at your convenience.

Welcome.

Thank you, counsel.

This week I have met a number of people that have been really struggling in the trans community.

This last Thursday, one of my friends came up to me in Cal Anderson Park and described how she had tried to kill herself the day before.

There are a lot of individuals like her that are struggling and that are feeling rather hopeless in our community.

As continued attacks happen nationwide on the trans community, support is needed and support is continued to be needed.

There is right now a $1.2 million grant that has been given to the Salvation Army to help homeless people in the Central District and in Cal Anderson and the Cap Hill area.

However, I have never seen them show up and I can tell you the people that are doing the work in our community instead.

Tonight, Stone Soup crew will feed between 250 to 300 individuals who need help in the park.

I have personally kept some people on my floor this week in order to make sure that individuals had housing, had something as simple as being able to wash their clothes or take a shower.

I can tell you the individuals that are showing up and are doing work for the people in our community, and I can tell you it is not the people that are represented largely in the budget, especially with the Salvation Army grant.

There are individuals constantly struggling.

We don't have things as basic as clothing.

The clothes that I've been able to gather with donations from other individuals are what a lot of these people wear.

The food that I'm able to help and scrounge up myself is often what helps feed people.

There's a lot of individuals that are like me that struggle and are begging for the community for basic funding in order to be able to receive, to be able to give to those who need, because there is so much need.

There are families that are showing up to Cal Anderson Park now, not just individuals, people fleeing for their lives because of transphobic legislation in red states.

We have to offer as much support as possible and connect people to resources.

We don't have this right now.

We need more help in the city to help us on that front.

Thank you.

Thank you, Rose.

Up next, we have Ref Lindmark followed by Logan Schmidt.

Laurel H, you're still not present.

We'll come back to you at the end.

Ref, I see you're here.

Star six to unmute.

There you are.

Welcome.

Good morning.

Thanks for having the council and taking my call.

My name is Ref Linmark, and I am a volunteer co-lead for the Blessed Sacrament Church Sunday Dinner and Food Bank Program.

I'm calling in to urge your past support and continued support for hot meal funding and food security items that are in the mayor's budget.

As you know, both the number of people we serve at our meal programs as well as the cost to serve them have gone up.

For example, at Blessed Sacrament Church, we have gone from serving between 300 and 350 meals a Sunday a few years ago, coming out of COVID, to almost 700 meals every Sunday.

The costs to do this have gone up.

As an example, our cash and carry purchase has gone from under $1,200 a month to over $2,000 a month.

Our Costco purchase, where we buy sheet cakes and water and other supplies, have gone up as well.

Our fixed costs, for example, are running our truck as well as fixing our refrigerator and freezer have costs that continue to increase.

We also provide security every Sunday to make everybody feel safe and that is also an increasing number.

All of these costs have basically made it more expensive and harder for us to purchase the food that we serve.

So we continue to use the support that the city has provided and we urge you to continue to support that investment that's in the mayor's budget and you continue to help us and we will continue to serve people in our community and for that I thank you very much.

Thank you, Ref.

Up next we have Laurel H is now present so we'll go with Laurel then Logan and then Cedar.

Laurel, welcome.

Thank you so much.

I thought October 8th meeting the council spoke about the offense of a sign that invoked the KKK, something we see again today, and stated it was despicable and contrary to Seattle values and cited our country's darkest history.

Yet, 24 hours earlier, activists gathered in District 3 at Cal Anderson to celebrate the October 7th massacre as resistance.

Our neighborhood was covered in pro-Hamas messages as it was the year before.

Hamas murdered more people that day than were killed by the Klan in the last hundred years.

It was interesting to see a trans person testify earlier about their lives being in danger in Cal Anderson.

There were people openly supporting murder in Cal Anderson last week, and not one person has said a word.

It's amazing how quickly our city changed from Black Lives Matter unconditionally to all Jewish lives can be snuffed out and then celebrated as long as it's done in a cause that the Black and Brown community supports.

And it's amazing that more people are not horrified by this.

In fact, I was called a Nazi for objecting to this.

And I am told that if there's a right to resist, how about my right to resist people celebrating murdering me in my own park?

Why is it the trans community got so much support when somebody made a slight towards them, a Christian group?

Yet this is flaunted.

And these groups who say they want to bring the same violence to Seattle, and Nadell are subsidized.

Cherry Street Village is given $500,000 on top of the $1 million in EDI funds so they could buy their space where they openly say they want to bring the same exact thing to our region.

I applaud Council Member Rivera for briefly bringing up anti-Semitism.

The fact everybody else ignored that is insane.

And this is a systemic problem that made a systemic solution.

Thank you.

Thank you, Laurel.

Anti-Semitism, Islamophobia, and all types of hate are not welcome here in our city.

Logan, you're up next, followed by Cedar and then Hannah.

Logan, I see you're here and you're off mute.

Welcome, Logan.

Morning, Chair Strauss and committee members.

Logan Schmidt, representing MBACs, here to comment on SCCI's budget and the central staff options today for the Construction and Inspections Fund.

The housing market is clearly in flux as interest rates and construction costs continue to rise and this is obviously impacting permanent volumes and therefore SDCI's budget.

It's an unfortunate reality that we are looking at another sizeable increase to permit fees again this year after last year's 18% increase.

I'll have to say, I asked the central staff and SDCI to provide a clear methodology for how review fees are calculated to determine whether the methodology should be reassessed as conditions change.

Permit applications are funding this department and they should be able to see how their fees connect to the cost of the services they receive.

We support Central Staff's Option C for Health and Construction Inspections Fund, which is continued quarterly reporting plus legislation establishing fund policies.

And we ask that the building community have a seat at the table as that policy is developed.

Builders can offer a practical perspective on the review timelines and predictability that make fees worth paying.

Clear reserve levels and thresholds will serve everyone best if they're set before the next downturn, not during it.

We support and request that the committee maintain SCCI's contingent budget authority.

When the market inevitably recovers, the department needs to be able to act quickly so review times don't become a bottleneck on housing production.

We look forward to continuing engagement on this issue.

Thank you.

Thank you, Logan.

Up next is Cedar followed by Hannah and then Stephanie.

Cedar, I see you're here, star six to unmute.

There you are, welcome.

Hello, so I'm here to speak again for funding social programs and about funding the fire department in particular.

We had a council member whose life had been saved by the fire department 20 years ago.

I myself had an experience when I was about 10 years old where I was at school and having breathing problems and the fire department came and saved me.

If I had been the police, I would most likely not be alive today.

As far as the police go, I think they've caused something in this city about $350 million since 2020 due to settlements, due to violent crimes.

They also train with the IDF and learn torture methods and killing methods from them.

And yeah, they're extremely violent gangs.

They have been since our country's inception.

They come from, say, catchers.

And I think it's really a bad idea to give them more money and 25% of the budget while they have not given back the $13 million that they have been overpaid while at the same time cutting funding like the fire department because if we do that, the next time someone needs help or gets hit by a truck and they're not there to provide support because they've been cut, I guess that person just dies now.

So yes, thank you for your time.

Have a good day.

Thank you, Cedar.

Up next is Hannah Ziff followed by Stephanie Zismet and then Julie Chang Schulman.

Hannah, welcome.

Star six to unmute.

And I see you're off mute.

Welcome.

Hi, thank you.

My name is Hannah from Pioneer Square calling about economic health.

Most people who commented about the budget throughout this process said that we wanna see investment into our community, Seattle, through the arts and other direct community building efforts.

not through increasing the SPD budget specifically.

As it would seem, the mayor sabotaged her proposed budget increase by using the Seattle Police Department on the trans community in Cal Anderson Park.

That is not really acceptable to throw rocks and hide hands or do things at the expense of harming others.

However, I'm not sure what the alternative would have been when 35 corporations created a petition to get Wilson to increase the SPD budget.

When I look at comments for improvements, for example, regarding the public bathrooms, people are very concerned about wasting money on products that are overly expensive.

So for the bathrooms, they were saying 140K per bathroom is too expensive.

However, when we don't take care of things as needed, then we are subject to price gouging and expenses going up exponentially.

We need our investments to be giving steady returns.

Seattle is an extremely profitable city.

Cut budgeting for fake job positions that are not realistic in terms of their job requirements.

These fake rules are created to cushion the budget for different departments, not hire people.

It's dishonest and hurts our bottom line.

Seattle is a corporation too.

Pursue creative revenue avenues besides taxes.

Every dealing with corporate entities should bolster the city's trust funds.

Seattle's wealth should only be increasing.

Thank you for keeping an eye on the budget, growing our collective wealth, and fending off corporate greed.

This is the evergreen city and the city of goodwill, not a golden goose-killing city.

We are a city of continuous profit for all.

Thank you for watching our bottom line and standing courageously on that business.

Thank you, Hannah.

Up next is Stephanie Sismet, followed by Julie Chang Shulman and then David Haynes.

Stephanie, I see you're here.

Star six to unmute.

There you are.

Welcome.

Good morning.

My name is Stephanie Sismaet and I'm the Assistant Director of the Community Dining Program at Sound Generations.

I am speaking today as a member of the Meals Partnership Coalition.

I'm here today to support permanent funding for meal programs.

I want to thank Mayor Wilson for including $1 million in permanent funding for meal programs in the 2027 budget.

Thank you also to Council President Hollingsworth and Council members Rink and Foster for your leadership in supporting funding for food access.

I urge the Council to sustain this investment in the final budget.

The Community Dining Program provides fresh, nutritious, and culturally relevant meals to older adults while socializing with others.

In partnership with Sites, we serve hot meals and support community connections at 16 locations throughout Seattle.

Our meal program also serves as an important gateway to other services, connecting older adults with additional resources and support that can help improve their overall well-being and quality of life.

Last year, budget shortfalls, staffing challenges, and growing demand for meals made from scratch and rising food costs required us to work with half of our meal locations to restrict the number of meals served.

Sustained meal program funding helps offset these pressures by providing valuable resources including locally grown food items that help cover our expenses and ease the financial burden on our program.

Sustaining this modest investment helps ensure that we can continue serving nutritious meals to the older adults who rely on our meal program.

Again, my name is Stephanie Sysmaet with the Community Dining Program at Sound Generations and I urge you to sustain the funding for meal programs included in the mayor's proposed budget.

Thank you for your time.

Thank you, Stephanie.

Up next, we have Julie Chang Shulman followed by David Haynes.

Julie, I see you're here.

Star six to unmute.

Hello.

Good morning.

Hi.

Good morning.

My name is Julie C. I'm co-executive steward of Forever Safe Spaces in On The Block Seattle.

I'm also the co-author of the Art and Culture is Public Safety Infrastructure open letter that you all have received.

and thank you for those that have been responsive in reaching back out to us.

As of this morning, I wanted to update you all that this letter has been signed by over 1,000 community members and over 130 organizations and small businesses.

And I also wanted to name that this is a distinct effort from the Inspire Washington letter, emphasizing that we want this money to be coming from the SPD budget and a part of the city's Public safety plan.

The work that we do is a fundamental truth that art and cultural placemaking is public safety infrastructure.

I know this from my own life experience as a former runaway and survivor of trafficking as a child.

When I was at my most vulnerable, it was the Seattle art and cultural community that provided me the sanctuary and a way to move forward.

And today we and many other small organizations in the city play these living legacies forward.

Across our four spaces, we serve over 60 different art and cultural workers who, in turn, play that forward and provide thousands of hours of free services and programming for the community.

This is the work that builds cohesion and healing and collective care, and that is the foundation of true safety.

And this past summer, with the 3.6 million investments that funded all these gorgeous art activations all over the city, by paying local artists to bring this work to the streets, to bring it outside, to make it visible, we achieved this historic decline in violence all over the city.

And I just wanted to name this and update you all on the progress and the amount of voices that are calling for this investment and for it to come from SPD.

Thank you.

Thank you, Julie.

Up next, we have David Haynes.

David, I see you're here.

Star six to unmute.

Good morning.

Hi, thank you, David Ames, Laura Quinn, and I call in today to address a staggering display of local failure and political hypocrisy.

Seattle is trapped in a slow motion humanitarian crisis because local, state, and federal leaders refuse to treat our homeless crisis and public safety crisis like an actual emergency.

Instead of an immediate aggressive response, the city is telling us to wait until the end of 27 just to see a scaled down rollout of emergency shelter beds.

Two more years of tent occupying our sidewalks, open air drug markets, and human suffering as a bureaucratic surrender.

The hypocrisy of this timeline is insulting when we look at your other spending priorities.

This council has no problem immediately finding $100 million for unaccountable social services and violence interrupters that coddle prolific gun-toting repeat offenders.

You are actively modeling our public safety response after the failed crime-ridden blueprints of cities like Baltimore, all while our neighborhoods face a crisis of lawless youth committing armed carjackings.

Even worse, your progressive policies routinely misconstrue full-grown 27-year-old adults as children or youth to shield them from adult consequences.

Let's be honest about why this happens.

It is a massive political payout designed to buy off the legacy of the George Floyd and Black Lives Matter protesters.

You have an endless blank check to subsidize activist groups, but nothing but delays for the vulnerable people freezing in our streets.

We should be demanding that the governor mobilize the National Guard, the noble National Guard, immediately.

We need them to display their unmatched engineering and logistical capabilities to stand up authorized, organized, and managed encampments in a matter of days, not years.

We do not want more expensive, unproven social experiments funded by our hard-earned tax dollars.

We want accountability.

We want our existing laws strictly enforced.

And we want violent criminals off our streets.

It is time for the council to stop apologizing for offenders.

Stop trying to buy peace from political activists and start prioritizing the safety of the citizens who elected you.

Thank you.

Thank you, David.

And we have one last public commenter who is here in person, although I saw them walk out the back door.

So Lydia O. Taylor, if you can hear us.

Would you like to give public comment as well today?

Would you like to tell us how to get our city building again?

I can tell you we will benefit from that construction sales tax.

Good to see you, my friend.

Lydia, if you can hear me, you are up next and we are waiting on you, Lydia.

Anyone want to poke their head out the back aisles?

I saw them walk out there just a second ago.

Lydia.

Lydia O. Taylor.

Lydia O. Taylor.

We are looking for you, Lydia.

At this point, just trying to stall so that you can give public comment.

Because I just saw you.

All right, we will try to draw this one out as long as we can to see if Lydia comes back with us.

All right.

Well, that's too bad.

Going one last time, Lydia.

Going twice, Lydia.

Going three times, Lydia.

And unfortunately, we'll check with IT.

IT, can you confirm we have no more public comment registrants online?

That is correct.

Thank you.

And Phil, can you confirm we have no more public comment registrants in person?

Yes, that's correct.

Thank you.

And Lydia, are you present?

I see not.

All right.

Well, Lydia, is that you?

I just heard a door close.

Lydia?

That's not Lydia.

Oh, Lydia's coming?

All right, Lydia, we are waiting on you, my friend.

Come on up, we are, your clock is ready as soon as you are.

You're fine.

Hi, my name's Lydia Taylor.

I'm just here to ask for more funding for public services and also to not fund the SPD.

Thank you, Lydia.

Seeing as we have no additional speakers present, signed up, we will move on to our next items of business.

Clerk, will you please read the first item into the record?

Agenda item one, introduction and overview for briefing and discussion.

Thank you, we have Director Lish Whitson and Deputy Director Calvin Chow from Council Central staff with us.

We do have Director Panucci in the audience, however, her time at the table has now passed, so if we do need to talk with her, she's easy and available to us.

And for the ongoing presentations, we will be led by Council Central staff.

With that, Lish and Cal, brief introductions and just jump right on into your presentation.

Colleagues will hold questions until the end of the presentation.

Liz Switson, Council Central Staff.

Calvin Chow is Council Central Staff.

And as a reminder, we are in the second step in the Council's review of the 2027-2028 proposed budget.

This is our policy considerations and revenue forecast update week.

My team has been working diligently to dive into the mayor's proposed budget, and we'll be highlighting some key issues for you to consider.

We will have memos for every single city department available tomorrow morning as part of Thursday's agenda.

Friday morning will be the Economic and Revenue Forecast Council's meeting, which will set the base for the Council's adopted budget adopting forecasts for revenues for the next few years.

Today we'll be in the morning talking about some citywide issues, looking at how the proposed budget balances the general fund and the jumpstart fund, and looking at a new proposed voluntary separation program that would apply citywide.

and this afternoon we start diving into department-specific presentations with the Department of Construction Inspections and the Office of Planning and Community Development and this is a little bit out of date.

We, at the end of the day, didn't identify any issues for the Office of Civil Rights.

As a reminder, a week from today at noon is the deadline for submitting amendment proposals, all proposals to amend the budget need to have two co-sponsors, and as we have done in previous years, we will be shutting off the portal for submitting amendments at noon because we only have a week to prepare them all.

I want to give sort of a brief background, context to the budget that you are considering.

We remain in a time of economic uncertainty, national and local employment.

Unemployment is rising.

The stock market is heavily balanced towards a few tech stocks.

Real estate trends both locally and nationally are worrisome, and our federal government is not a stable partner in terms of funding for public services.

In that context, we'll get a new forecast for the city's next few years of revenues on Friday morning.

When Mayor Wilson came into office, she was presented with a budget that was forecast to have significant deficits in 2027 and 2028. As you'll hear this morning, she has presented a budget that is generally balanced through those years and up to 2030. It does rely on some one-time adjustments to the balance, and we are projecting a remaining structural deficit going into the future.

Finally, we continue to face a number of policy challenges, sustainability of the budget, homelessness remains a significant issue in the city.

Downtown and neighborhoods have still not quite recovered, or speaking of downtown office market, have not recovered from changes wrought in 2020. Housing affordability remains an issue, public safety remains an issue, and our real estate market shows signs of significant weakness.

And with that, open to questions.

Thank you, Director Whitson.

Well said on the budget proposal deadline of being next week at noon, and that's on Tuesday, correct?

Correct.

Tuesday the 20th.

We've been making that announcement since August, so folks, I hope you're ready.

Please do make sure that when you're talking to your colleagues that just a head nod or a general agreement is not necessarily agreement to be a sponsor.

I'm asking for explicit yes, no, because we will be listing you as a sponsor.

Central staff in my office will also be following up with your offices to ensure that you are a sponsor.

And as a reminder for the following step that is very similar.

Just because you have a co-sponsor for this step does not automatically transfer that co-sponsor to the next time you may bring that amendment.

So at our next amendment deadline after the chair's package, you will need to reconfirm your budget, your co-sponsors, even if it's the same amendment.

with that, colleagues, I'll turn it over to you for questions because that's the most important part.

It'll be really important for us to continue taking notes as central staff presents their analysis this week because if you would like to run any amendments regarding what their analysis is, we'll need a quick turnaround.

Central staff their job is to present to us all of our different options just because they are presenting an option or highlighting an issue does not mean that we must make that change nor are all of the options on the table the only options that we have to take.

And so generally I've asked for a, you know, what is A, B, or C, do nothing.

Those are all options for us.

With that, colleagues, are there any questions on where we are at in the budget or the next steps?

I'm feeling good.

With that, clerk, will you read item number two into the record?

Agenda item two, general fund balancing and sustainability analysis for briefing and discussion.

Wonderful.

We are joined by Tom Mikesell.

Tom, take us away.

Good morning, Chair Strauss, Vice Chair Rivera, members of the Select Budget Committee.

I'm Tom Mikesell, Analyst with Central Staff.

So this morning we're going to be covering the General Fund Balancing Sustainability Analysis, covering the 2027-2028 proposed budget, as well as the future year projections in the financial plan.

Given the intersection with regards to balancing the general fund with the Jumpstart Payroll Expense Tax Fund, we'll also touch on implications to that fund as well.

So by way of the things I hope to cover this morning, and there's a much more detailed memo attached to the agenda, which we can refer to as needed.

The points I'd like to cover first touch on the last year's budget sustainability requirements and resources that were put in place through council actions.

Then kind of going through the numbers, we're going to revisit the 2026 adopted budget just to kind of look at the approved and proposed changes that are before you.

to see what kind of resources one-time basis were generated.

Oh, and we'll look at the deficit projection that was included last year, which showed $149 million deficit in 28, or 27, and $129 million in 28, respectively.

Review, okay, this is the review of the 26 revised budget adjustments, and then the proposals included with the mayor's budget.

Then we'll go on a stepwise analysis of the 2027-2028 proposed general fund budget changes and compare them to the projections that led to the $149 and $129 million deficit with the intent to show how that deficit was resolved in this proposed budget.

Next, we'll look to the future to see how those changes and how the executive's kind of attention to the budget sustainability requirements that were put in place last year, how those were met in the financial plans for the general fund.

And then we'll look at the Jumpstart Fund because of the intersection with the general fund and do a similar analysis and then conclude with a policy consideration.

So the first step is to kind of look back in time, review the budget sustainability requirements that were put in place by council last year.

First is ordinance 127259, which restructured the business and occupation tax that was submitted to the voters and approved by way of proposition two.

That measure generated over $80 million of annual general fund revenue from the business and occupations tax through 2032 when those changes sunset.

There was a requirement added by council that in the event that the 27 budget included revenue from these changes, that the executive was to submit balanced financial plans for the general fund and the jumpstart fund.

And that is a new requirement.

The requirement to have a balanced budget has always been in place.

That's in state law.

But showing future projections that are balanced, that was a new requirement put in place by council and voted on by council.

of the city of Seattle.

Next was a statement of legislative intent that was added during the budget process.

It was part of the kind of multi-phase budget reform that's been ongoing for years that requested that central staff and the city budget office work together to put together a glossary of shared terms and concepts that are crucial to understanding the kind of concepts that we're gonna talk about with regards to balancing the budget and balancing financial plan.

And so just a few of those things that will come up in this presentation that are kind of integral to how it all hangs together, our financial plan.

So this is a multi-year projection of revenues, so resources and expenditures, and you're looking in the past, looking in the present, and looking in the future, just to see what is ahead of us with regards to city finances.

one time, so this is where spending is added for a single year and a single year only.

So if it's added in 27 one time, then it will not continue into the 28 and future year budgets.

Ongoing is the opposite of that intuitively, that when spending is added that's ongoing in nature, financial plans will include that in every single year into the future until decisions are made to remove it from the budget.

and then planning reserves.

These are otherwise known as below the line items.

So this is a portion of the financial plan where something hasn't quite hit the budget yet, but it's anticipated that there's going to be an obligation for city expenses, so a draw on resources.

A real common example of this is labor, contracted labor expenses.

So when contracts are under negotiation, we want to ensure that we will have enough resources at the time when we need to meet those contract obligations in the future.

So below the line monies are added for those and certain other things.

So that's the sustainability framework that will kind of be present throughout the presentation.

So this graph before you should be familiar at this point.

If not, it will be familiar because we'll touch on it at both the beginning and the end of the presentation.

But this is how the projections, so the future look at how the general fund finances would be going out to the year 2029. One thing, the 2025 number doesn't include any carry forward, so any kind of budget from prior years, you know, strip that out.

So to make a kind of one-for-one comparative example, and the expenditures in 27 through 29, even though those planning reserves that I just was talking about are not part of the above-the-line appropriated budget, we include them in the expenditure line in this chart because they are obligations of the city.

They just haven't hit the proposed budget yet.

So the key takeaway for this slide is that last year, well, not quite this time, but at the conclusion of the city budget adoption process, it was projected there'd be $149 million deficit in 2027 and $129 million deficit in 2028, and that gap was expected to continue into the future.

So that is the structural deficit that we talk about, and this was the challenge that was faced in putting together the proposed budget.

So now I'm going to walk through some of the different changes that are included in the proposed budget.

And the first place to start is kind of looking at the budget that we're in right now.

And so a lot of work has been done.

This is the most complex table in the presentation, but it captures a lot of different concepts.

And you can go sequentially through how it all hangs together.

So at the start of the year, after that budget was adopted last year, it was projected that the ending balance for this year would be $7,000, so balanced just by a hair.

Since that time, there's been some changes, some good news, some higher costs and things of that nature, and that's what's shown in this chart.

So first, 2025 revenues and expenditures, the kind of the mass balance of it all, came in better than expected.

And that right there added $109 million of one-time money into the city coffers.

Some of that money was there to pay for carry forward, so prior obligations too, so it kind of cancels a bit of it out.

So the next step, so step two is where the approved and automatic carry forwards and supplementals, so these are the kind of mid-year requests for spending, come into play.

The net result of that as in this subtotal line, $85 million.

So $85 million of that kind of $109 million starting balance is used up for those kind of approved measures, automatic and approved measures.

Did get some slight good news in the August revenue forecast, about $10 million more in 2026 of new revenue.

So that's good news, adds to the available resources on a one-time basis.

And now in step four of the table, this is the proposed budget legislation.

So these are the things that are before you during this current budget process, and the revenue and expender.

So these are gonna be the year-end supplemental, so the last changes for 2026, and then the year-end grants.

And so that's the last request to accept new revenue from external providers and spend that money in the budget.

And then there is a use of planning reserves, because some of those adjustments are contractual in nature with regards to salaries, and so those planning reserves get moved above the line and used to support those spending requests.

The sum total of all of that activity is as a hit, so kind of an impact of $2.5 million.

Then the final adjustment is adjustment that the executive made to the remaining planning reserves.

reassessed their assumptions that they were making in the reserves and wrote off about $24 million from that below-the-line expense.

So you have to wrap all of that up and you pull it all together.

The end result is that the beginning fund balance, so the one-time resources that the mayor had to work with in putting together her budget, increased by $56.5 million at the end of 2026. And so that money is available to spend in 2027 and beyond.

So now we're going to talk about the 27 and 28 proposed adjustments in the mayor's budget.

And I'm going to, as I mentioned, start from the projected deficit numbers that we showed on that prior chart, the $148 million deficit in 27 and $129 million in 2028. And I guess the way I would characterize this is, you know, every forecast is a projection.

It's like you're planning a trip and you're looking at what the weather forecast is and and it looks like it's gonna be sunny.

And as you get closer, you think, ah, it's maybe gonna rain.

And so you need to bring an umbrella.

And your assumptions change, the realities change, and as you get closer to that, you can fine-tune your assumptions.

And that's the exact same thing that's happening here.

We had an assumption of $149 million based on projections that the executive is making, and now various changes are gonna revise and fine-tune that assumption for the 28 proposed budget.

So starting from that, the first step is going to, actually there was an increase to the deficit based on some information from the mayor, updating their planning assumptions and also information from the April revenue forecast.

Next we'll look at the kind of the technical process in the budget development where they look at their estimates of inflation, their estimates of city costs, kind of the baseline, keeping the cost of current services going, reassess those, fold that impact in.

Then we'll look at the net impacts of the mayor's spending proposals.

So these are the increases and decreases to various departments in the budget.

And then finally, we'll look at the new structural deficit in comparison to the numbers I showed previously.

So the first step is the executive's planning assumptions.

So in April, the executive communicated that there was increasing cost pressures and identified risks that would increase the deficit in the biennium.

Those were limited to higher projected labor costs.

There was a slightly better April forecast, so that kind of helped a little bit, but was not enough to close the full gap.

There was essentially an increase in the deficit of 26.3 million in 27 and 34.7 in 28. So when you include those impacts to the $149 million and $129 million estimate that we started with, that leaves you with $175 million projected deficit in 2027 and $164 million in 2028. So now, dealing with what did the mayor do to address that increased deficit?

So first, inflated ongoing costs.

So these are the kind of checking the inflation assumptions against reality.

Inflation, as you know, it's covered in the memo, has gone up in recent months, and it stays at a high level.

So the ongoing costs are projected to be $88 million and $109 million lower, or higher, I should say, than they're projected.

So increasing costs.

However, those below the line planning reserves that I mentioned were able to be reduced by an even greater amount in $148 million, $140 million in 2028. So that's kind of the combination of higher costs in the above the line, but lower costs in the below the line netting out to a positive result.

There are a couple of items that I want to point out here because they're important for the analysis, particularly with regards to the Jumpstart Fund.

and also items of council interest.

One is that the planning reserves in the general fund included $13.8 million in 27 and $18 million in 28 for enhanced shelter.

So as part of the mayor's communication about the increasing cost pressures in April, they also indicated that those kind of previously below the line costs were now moving above the line.

And in fact, in the ultimate budget proposal, as you'll see in the discussion of the Jumpstart Fund, she actually funded those shelter costs in the Jumpstart Fund and not the general fund.

So that results in a reduction in the general fund cost, but it moves it to another part of the city finances.

Another piece, and this was discussed in the memo last year at this time, there was a placeholder for $20.7 million of costs in the below the line planning reserves for Seattle Shield investments.

So last year's budget included approximately $30 million of investment, but a big chunk of it was one time in nature.

It hadn't been programmed in the budget.

It was held below the line.

in 27 and beyond and to ensure that the space was built into the revenue forecast to support those.

So now they've moved that from the below the line to the above the line part of the ledger and funded approximately 19 odd million dollars of items in the budget.

They're detailed in the memo.

to kind of meet or come close to meeting the up to $30 million of that new B&O tax revenue from the B&O restructure or the Seattle Shield measure to kind of meet those requirements.

But since it's an adjustment, it's moving it from below the line to above the line, it's part of the planning reserve adjustment.

A couple other technical items, real quick.

Revenue stabilization fund and emergency fund.

There was a projection for what those would be last year.

Revenue stabilization fund is based on city revenues.

Emergency fund is based on inflationary growth.

The net result of the adjustments reflecting the different, different basis for each of those reserves was an $8 million or $9.9 million decrease in 27 and a $2.8 million increase in 28 compared to the projections that were available last year.

And just as a kind of a side note, because you may hear the words reserve and to understand where we are with regards to reserve, both of those reserves are 100% funded in this budget to their policy levels.

The emergency fund is $92.4 million available for unplanned emergencies.

And then the revenue stabilization fund is $82.1 million.

And that's in the event that revenue forecasts come in below budgeted projections.

Then the final step in the baseline phase is revenues.

So August revenue forecast raised revenues by $31.3 million in 2027, $39.8 million in 2028, and that's primarily from changes in gross Senate bill from last year, which expanded the tax base in the B&O tax to include previously untaxed services.

Bottom line, key takeaway from all of these changes is that the cost projection compared to the deficit last year decreased the deficit by $90.9 million and $67.2 million in 2028. So those basically reduced that prior $175 and $164 million deficit.

So now the mayor's operating proposals.

So these are the new requests to make changes in the budget.

On a net basis, these proposals would decrease spending, decrease appropriations by $61 million in 27, $78 million in 2028. So this is a mixture of increases to some places in the budget and decreases to others, and also a mixture of ongoing and one-time changes.

There is an attachment included in the memo that includes line by line for each department what those adjustments are.

But in terms of high-level discussion, The appropriation increases are $44.7 million in 27, $28.3 million in 28. And of the increases, $21.5 million would continue into future years.

The decreases on the other hand are 105.6 million in 27 and $107 million in 28. The entirety of that decrease in 28 continues into future years.

And that is really what does a lot of the heavy lifting with regards to reducing the structural deficit.

In terms of the largest single decrease in the general fund budget, it's the shift of $47 million of homelessness programming that's in the human services department in both 27 and 28, and that fund shift moves that on a two-year basis from the general fund to the jumpstart fund.

I will note that there is an existing interrelation between the general fund and the jumpstart fund that we've been using for essentially since the jumpstart fund was created in 2021, and that's an inter-fund transfer line, so it's basically just sending Sending cash between the funds to help one balance the other.

So this is a bit of a departure by way of moving wholesale programming over to the Jumpstart Fund.

It's entirely consistent with the Jumpstart Fund policies as amended by Ordinance 127155, but I just wanted to point it out since it is a bit different than what we've seen in the past.

Bottom line from all these changes is that the mayor's net operating proposals would decrease the deficit by $70 million in 2027 and $78 million in 2028. And that, again, nearly half of that is a shift in homelessness funding to the Jumpstart Fund.

But bottom line is that the net decrease improves sustainability in the general fund compared to the projection from last fall.

So this is a bit less complex table, just brings together all of the various steps, starting from the $149, $129 million deficit, adds in the update to the planning assumptions in the April forecast, adds in the mayor's proposals and gets you to a revised structural deficit.

So this is kind of the difference between the expenditures and planned spending of $23.2 million in 2027 and $18 million in 2028. So if you'll harken back, I mentioned in kind of one of my earlier slides how at the end of 2026, there was about $56 million of one-time fund balance that was available.

Well, that one-time fund balance is used to cover this deficit for over two years.

So this is what our new sustainability graph looks like with these changes embedded and with the, you know, still making projections about 29 and 30. As you can see, I can't even fit the numbers between the lines anymore.

I have to kind of go outside that graph, but they're still there.

It's still a $23 million deficit in 27, $18 million deficit in 28 for the purposes of budget balancing under state law that is fully covered and fully balanced by the use of fund balance.

The use of fund balance continues into 2029. There's a $14 million draw, and at that point that entire $56 million of starting balance is used up.

And then in 2030, $9 million surplus.

So just a few brief comments on sustainability, and I essentially covered this, but how the fund balance is used to kind of bridge the structural gap over three years, leading to a surplus by the fourth year.

But this is something that's not readily apparent because council is not adopting a financial plan.

Council is only being asked to consider a proposed budget.

So there's no decision inherently inherent to be made with regards to 29 and beyond.

Just giving giving a heads up, since this is a change that's not visible in the financial plan otherwise, and that is to balance the general fund in the future, or the jumpstart fund in the future, a portion of that homelessness funding shift will have to shift back from the jumpstart fund to the general fund.

And so that's just necessary from the executive's perspective to balance the jumpstart fund.

Again, that could be handled with the toggling to that inter-fund transfer, but that's how they've chose to present it in the financial plan.

So now I'm gonna continue on and do a bit of a same read on the Jumpstart Fund budget.

This is just looking- Let's actually pause right there since we are now moving between funds.

I know that you gave us quite a bit of overview, but I wanna check in with council colleagues to see if there are any questions specifically about the general fund.

I'll tell you, I greatly appreciate you bringing this presentation to us.

This, colleagues, this was part of our budget reform in content process and procedure that we have been working with the city budget office over the last number of years.

And so this presentation was formalized, as Tom mentioned, through the statement of legislative intent that was sent out to all colleagues earlier in the budget site, at the beginning of the budget process.

This is one of the cleanest and clearest reads using consistent benchmarks to help us understand what the structural budget deficit is.

Because over the course of the last number of years, there have been, maybe the best way I'll say it is there has not been a consistent definition.

This helps us create that consistent definition to really be able to say, are we getting better?

Are we getting worse?

I will say, as far as the mayor's budget proposal goes, this is really important and this is good work.

It does come at the cost of what I am worried will stop the city's positive momentum in its tracks.

And that's what we'll get into colleagues with the additional analysis and council member proposals.

But I will say reducing the structural budget deficit is an important thing that we are doing.

And it seems, and this will be my only question to start us off.

It does seem that this is accomplished through many cuts and the expanded use of the Jumpstart Fund.

generally correct?

Are there other attributes that I'm missing here?

Chair Strauss, that is accurate.

Essentially the net cuts, that the net decrease to the budget is doing a lot of the heavy lifting.

The improvement to the general fund forecast played its part from August as well.

And we'll see there's a forecast coming up at the end of this week as well, see what that does.

Hopefully good, good news.

And also, yeah, exactly, the shift to the Jumpstart Fund.

And the sustainability discussion asked specifically for kind of looking at the implications back and forth, because they are essentially, the city's two largest general purpose funds at this point.

So yes, that's accurate.

Thank you, Tom.

Colleagues, are there any questions at this time?

I'm gonna hold my questions until the very end of the presentation, just to see if folks have theirs.

And Council Member Rivera, I'm gonna call on you once right now, and then we'll come back to you at the end of the presentation as well.

Thank you, Chair, and thank you for the presentation, Tom.

Two quick questions.

One is just to confirm what I thought I heard, which, again, to reiterate, the shift from the general fund to the jumpstart fund was half.

I thought I heard you say half of how they're taking care of the structural deficit, and then the other half are reductions, but I assume those are mainly the one-time ads.

because I noticed as I was reading through the budget that there were a lot of one time ads that are just getting quote unquote reduced.

And so is that the other half or are there things in addition to the one time?

Thank you for the question, Vice Chair Rivera.

So that's a great lead to kind of explain a bit how it all hangs together.

The one-time ads from last year, so things that were added in the 2026 adopted budget on a one-time basis, those are taken out actually in the baseline and technical phase.

And so CBO is producing their kind of baseline assessment of the budget to start for 2027. one of the first steps that they do is take out that one-time stuff.

Now, it could get added back as part of a proposal, but in terms of doing the kind of clean baseline, they take those items out and then inflate those ongoing costs.

With regards to how to think about the ups and the downs within the budget, if I could, I'll go back to this slide here.

So the net decrease is $61 million in 78. So that's a mix of ongoing and one-time spending in the budget.

The increases are 44 million and 27, 28 million and 28. Only $21 million of that is ongoing into the future.

But if you look at the decreases, which again, I think it's about half of that is that homelessness funding shift.

That's $105 million.

And that's 107 in 2028. That's all ongoing.

And so if you look at the net on a two-year basis, it's 61. But if you kind of stretch that out onto what's really going to continue into future years, that's on the order of 107 million dollars and yes, about almost half of it is that homelessness funding shift.

Councilmember, may I add something as well?

You know, this is a very high level, and so when it comes down to what is the effect, it really will come down to the individual departments.

One of the themes of Director Panucci's presentation was the idea of right sizing and trying to figure out what is the sort of new established baseline of service delivery.

So that is kind of embedded in part of this.

But to understand what that means, it really does come down to looking at the individual departments.

Yes.

Thank you, Cal.

I noticed that as I was reading through the budget too, and there were a lot of vacancies that got cut, but we don't know how long those things were actually vacant.

Having been at the city for a long time, I know some things are vacant for many years and some aren't.

And so it's a mixture of things I think, but I, for the record, wanted to make sure that I noted these things that Tom was saying.

Um, I do have one last question, which is that given the, the, increase inflationary increases every year.

We're going to continue to be in this quote unquote deficit situation because we will be increasing the budget every year by that inflationary piece, which is basically our our salary increases, for instance.

Yes, but so the projections that the executive is making for twenty nine and beyond they include assumptions about inflation, including labor costs.

And so that's kind of part of the assessment that I was doing in that stepwise analysis is saying last time these projections indicated costs of X.

Now we've got more recent information.

Those costs have increased by Y.

Here's the difference.

And so something similar will happen next year.

We continue, you know, we continue to.

What was the analogy?

Build the car, not build the car as we move, as we drive the car, but something similar.

We're constantly assessing where we are, projecting the future, reassessing where we are, looking where we have been.

But all that to say is there is inflation assumed in 29 and beyond.

Yes, thank you, Tom.

I meant beyond 28 into 29, 30, et cetera, et cetera.

It will continue to increase based on inflation.

And so this idea of a deficit, a lot of the explanation is the inflationary piece.

So even if we keep making adjustments, we're still going to have to deal with that piece into the future years.

So we're never going to be in a non deficit situation per se, because we will always have that inflationary piece to have to manage for.

I would say if the actual inflation, if the projections that get made for inflation next fall are higher than the projections that they're making now, that would increase the deficit.

If the projections that we make next year are in line with the projections that are being made now, the numbers that you see for the deficit will be what they will be.

I mean, because that's essentially what we are doing, is we're projecting what the deficit is going to be in the future based on assumptions about inflation, based on assumptions about revenues.

and those will change.

And that includes- Sorry, Tom.

I just want to make sure I'm under- into 29, we won't have a deficit based on the inflationary piece because that's assumed in this 27-28 budget proposal.

Correct.

There is an inflation- there is an assumption that labor costs are going to grow.

Contract costs are going to grow.

The question is, When we get there, is that number going to go up or is that number going to go down?

Is inflation going to be higher?

Is inflation going to be lower?

And that's going to have an impact on the projection.

I mean, that's essentially a big chunk of how the 2027-28 proposed budget was resolved is those projections for this current biennium came in lower.

And so we were able to reduce some of those kind of baseline costs.

And a lot of it was in planning reserves and things that I discussed previously.

But it's constantly that effort, and sometimes it does increase the deficit, but then if the revenues come in higher, that will decrease the deficit projection.

So we know what we know right now and make the best guesses and then move forward into the future and constantly reassess.

But that's more based on how much we're bringing in, probably, the revenue side.

Correct?

Correct, absolutely.

Okay, thank you.

Thank you, Chair.

Yeah, well said, Vice Chair, and I'll tease this out just a little bit more and just to state that if all things are held constant beyond what you are stating about inflation projections within the budget, Let's take this all out of it.

Councilmember Rivera and I sit on the Association of Washington Cities Board, and I can tell you all 281 cities and towns in our state are experiencing this.

And it comes back to the fact that we only get 1% property tax increase.

That's not 1% per property, that's 1% across the entire tax base.

if we were pulling 1% increase from every single property owner in Seattle, we would be in a much better financial position year over year.

But we are only collecting 1% on the entire tax base plus new construction.

As you know, when Ken Johnson came into chambers earlier, I was joking in a very serious manner of how do we get the construction budget going again?

Because that is what helps us attend to the ongoing lack of revenue and higher expenditure issue that we're experiencing because 1% of our entire tax base does not keep up with inflation as it goes farther.

Colleagues, thank you for letting me soapbox there for a minute.

We've got Council Member Kettle followed by Council Member Lynn.

Thank you, Chair.

And my question or comment has been kind of observed a little bit by the Vice Chair, but I'll say it anyways.

On Slide 7, you know, in terms of the changes from projections and so forth, in the key takeaway box, this key takeaway, inflationary changes to ongoing costs, lower planning reserves, transfer adjustments and higher forecasts decreases deficit by $90.9 million in 2017 and $67.2 million in 2018. I'm echoing a bit.

This is a key concern for me, planning assumption.

And I've seen the Fed Cleveland report, what theirs is.

But as we can see from the news, the straighter home moves, now the Balab Mendeb, with what's happening with the Yemeni Civil War, which is now the Yemeni-Saudi Arabia War, which then goes on top of the U.S.-Israel-Iran War.

Oh, by the way, we still have the Ukraine-Russia war.

In terms of the geopolitical risks, the fuel costs, which then impact everything, you know, in terms of delivery, so then baked goods, you know, everything is impacted.

And I think it's pretty rosy.

And this goes from, you know, the Fed overall, Fed Cleveland, as I'm seeing here, all the way down to Seattle.

I think it's rosy.

We'll see.

And so then, if they do come, is there anything we can do like in terms of reserves to hedge or to protect ourselves if that, if these inflationary assumptions are a bit too rosy?

Well, Councilmember Carroll, we do have revenue stabilization reserve.

However, that's for the event of revenues coming in below forecast.

If costs come in above forecast, we do have the emergency fund.

That's available for unforeseen circumstances.

We'd have to assess whether or not higher inflation would meet that standard of unforeseen circumstances or not in order to deploy those resources.

But otherwise, it would be if we saw, say, an increase in the regional economic forecast that led to higher costs, we would see adjustment requests from the executive and required requiring to use measures to address that in the near term, kind of like the the opposite of the supplemental budget, frankly.

Yes, and I didn't even mention federal deficit spending.

Our president doesn't care.

He doesn't care about anything.

So how much money is washing around America on top of all the other issues?

I'm just stating for the record, I fear that the inflation assumptions are a bit too rosy.

I hope I'm wrong, but we'll see.

Thank you, Chair.

Thank you, Councilmember Kell.

Councilmember Lin.

Yeah, thank you.

And Councilmember Kettle, I was kind of having a little bit of a related question, just on our fiscal reserve funds.

So we have our emergency fund, the revenue stabilization fund, and then the Jumpstart, I think, stabilization fund as well.

And could you, just my overview is, you know, we dipped into all these during COVID, and now we've been building them back up.

and despite the fact that we are in a tough budget, it looks like we are, at least the proposal has us maintaining these reserves.

Could you just talk in general about how we're doing in our reserves and how we might compare to other jurisdictions in terms of our reserve funds?

Yes, Councilmember Lin.

Both of our reserves, so we have the emergency fund, which is a policy requirement of $60 million in 2016 levels, just inflated by annual inflation.

And that, consistent with your read, that was heavily used in the COVID-19 pandemic response.

Since then, with a consistent replenishment, it's back up to 100% policy.

and now the transfers in the budget continue it at that policy level of $92 million.

So that's available at this full policy level.

The revenue stabilization reserve, that was used initially in COVID, but then it was immediately replenished with some good favorable revenues and has just been, we've been keeping it at policy, which is 5% of general fund revenue, general fund tax revenues, and it stands at $82 million.

I don't have a great, a great response without some kind of further check back with the executive on how these reserve balances compare as a percentage of kind of the expenses that they're intended to kind of protect against We have to do a little bit more research to get a good benchmark read.

I mean, I have numbers that float around in my head from other cities that I've worked at, but that's not going to be a real great comparison group, perhaps.

So we can follow up with that information.

The revenue stabilization account in the Jumpstart Fund, so that has a four-year replenishment cadence, and the budget The proposed budget is years two and three of that, so that's supposed to be 10% of payroll expense taxes that are deposited into the JumpStart fund.

It's actually higher, 10%, than we'd use for the general fund writ large.

Those taxes, that revenue stabilization fund is 5%, so we acknowledge that the JumpStart payroll expense tax is more volatile, and we use a 10% measure there.

I believe, and actually that's a future slide here of my presentation.

I believe it gets to approximately $20 million in 27 and somewhere between that and $42 million in 2028. So again, two years, two and three of the four-year replenishment cycle.

Thank you, Chair.

And that is just kind of, again, to help us be ready for if the Jumpstart Payroll Expense Tax takes an unexpected dip.

Thank you.

And well said, Council Member Lynn.

I'm gonna tease this one out a little further because those are our legislatively required reserves.

On top of that, we have also the COC reserves, which are different than our federal reserves.

And so, when we had the SNAP emergency where the president cut SNAP funding, we were spending a million dollars a week on food.

That is what the Federal Reserve is for, for the unforeseen consequences of the federal administration.

in addition to that they have been already making cuts to housing, permanent supportive housing, any type of supported housing and our housing providers that we rely on here are relying on those funds and that is what the COC reserves are.

Those are two distinct reserve funds that have different purposes.

I know that there has been a little bit of conflation in the past and so I'm just here clearly stating that they are different.

And so of all of these, we have the emergency fund, the rainy day fund, we have the jumpstart reserves, we have the COC reserves and the federal reserves.

We have a couple other reserves, but those are the main five.

Is that correct, Tom?

Correct.

And so these are all at high levels of replenishment at this time, even though we are still experiencing the downstream economic impacts of the COVID-19 pandemic and then following economic slowdown, recession, however you want to call it.

Thank you for letting me add on there, Council Member Lind.

Council Member Foster.

Thank you so much.

I really appreciate the presentation today as always.

I want to turn to slide 14 and just want to make sure that I'm clear on the homelessness fund swap and the timeline for that.

So my understanding is in the current budget proposal, that fund swap between the general fund and jumpstart is for 2027 and 2028. And then in 2029, this goes back to the general fund.

Is that correct?

That's correct, and again, as I mentioned earlier, that's just kind of a planning assumption that they're making to kind of meet the balancing standard from the Seattle Shield bill, but yes, that's accurate.

Okay, and then the other question, if you can remind me, and I know we're going to go into JumpStart here in a second, when is JumpStart slated for renewal?

JumpStart sunsets December 31st, 2040.

Thank you so much.

I just wanted to think about that as we're sort of forecasting ahead when we get a positive fund balance, but also just something that is on my mind is we would be, you know, we wouldn't have the flexibility to make this $47 million shift.

If we didn't have a jumpstart, we would be looking at another $47 million reduction overall if we didn't have the ability to move from general fund over to jumpstart.

Is that accurate?

It's absolutely accurate in regards to the fact that Jumpstart is another general purpose revenue source that, and as we can cover here in a few of these slides, there's some moves that are being made in the budget to free up that cash to allow that to happen.

Thank you.

And then one question, just because I wasn't, I wanted to make sure I have an understanding of the new forecasting practices as you described them in the beginning.

So we've now got the projection out into 2030 and then ongoing, will we be expecting that future budgets delivered by the mayor will have this same forecast out five years into the future?

That's now our sort of current standard practice, or is that just standard practice so long as we have the B&O change on the books?

Councilmember Prosser, that's a great question.

So the standard of practice of doing a six-year financial plan has been kind of commonplace at the city.

It was memorialized and a part of budget reform measures two, three years ago with the fiscal transparency program.

So that requires a financial plan format that includes a very standard assumptions and things of that nature.

Up till this budget and since COVID, those financial plans were showing large, significant general fund deficits in the future.

So after the budget, the out years were heavily in the red.

The Seattle Shield bill last year is what put in place that standard to say, if you're going to use the new revenue from the B&O tax changes, show how the financial plan is balanced in the future.

But that was only a single-year requirement for the 2027 proposed budget.

So next year and beyond, there's not a requirement to show outside the proposed budget that the financial plan is balanced.

Thank you for that, and I appreciate the clarification on the outlook versus the balancing in the outlook.

Thank you.

Thank you, Chair.

Thank you, Councilmember Foster.

Colleagues, any other questions on General Fund?

Otherwise, we're going to keep rolling into JumpStart.

Wonderful.

Right back to you, Tom.

Let's take us through JumpStart.

Thank you, Chair.

So this is kind of a truncated version of what we did with the JumpStart Fund.

I'm just going to start real quick because it's similarly important for this fund, as it is the general fund, how the 2026 changes both those that have been adopted by council and those that have been proposed with the mayor's proposed budget, how those all generate cash that's used in the budget and the financial plan.

So in the 2026 adopted budget, it was assumed to be zero unreserved fund balance, so zero excess cash that hadn't been programmed.

The 2025 year-end reconciliation, and this is kind of a similar trend of past reconciliations, revenues above forecasts, expenditures below budget came in to generate an additional $337 of $337 million of extra resource to kind of add into that 2026 budget.

A fair chunk of it was actually repurposed by way of appropriated carry forwards that were adopted by council earlier this year, $304 million to be exact.

So that kind of used up a lot of that.

And that's just how the way it works, that excess cash has gains from the, or has kind of checks written against it from the prior year, and council just assesses whether or not to re-up those checks or not, and that's what happened in this case.

Revenue forecast from August only added about $2 million of favorable news for 2026, but it is still favorable in the plus column.

And then finally, the proposed adjustments that are before you with the mayor's budget, and particularly in the year-end supplemental would, Reduce appropriations in the Jumpstart Fund by $66 million.

I believe this is touched on in some bit in the Office of Housing paper, given to how they're revising the way they manage the cash, particularly those commitments towards housing in the NOFA.

Basically, there was a large balance of cash and they're trying a new cash management strategy and by way of that strategy, and again, there will be a better discussion of this in the Office of Housing presentation, but it essentially kind of says, we're not going to use the cash in this year, we're going to close that to balance and then use it as part of the plan to balance out the Jumpstart Fund.

And that's what happens, as you'll see in the next few slides.

So basically wrapping up all of the 26 changes, the good news from the end of 25 and the kind of repurposing and then the strategy that's in that proposed budget in the year-end supplemental leaves about $101 million of ending cash in the Jumpstart Fund that's used in the 27-28 budget and the financial plan to kind of show that sustainability requirement in the future.

So, similarly, we did a baseline technical adjustment, or not we did, but the City Budget Office did their exercise and that resulted in a $43 million decrease in 27 and $33 million in 28, basically taking out the one-time items and inflating those things that are going to continue.

things like labor costs and other inflationary adjustments.

They essentially matched the transfer between the general fund and the jumpstart fund, so this is what kind of toggles the resources between the funds to help one or the other balance.

They matched the financial plan from last year, which is an adjustment downward.

The revenue forecast in August was quite favorable.

They upgraded the revenues by $30 million in 27 and $31 million in 28. And then again, we've talked about this for a fair amount, but they adjusted the transfers.

And this is in a below the line display.

So this is not part of the appropriation.

This is just in the planning reserves part of the Jumpstart Fund.

They increased that payroll expense tax reserve to $20 million in 27 and $31 million in 2028. And again, that's going to meet the 20% of revenues requirement by 2029. and then the proposed changes.

So there's actually budget legislation that's been proposed by the mayor with regards to revenues.

And so this is an existing standard deduction for nonprofit healthcare expenses within one of the payroll bans and the payroll expense tax, specifically payroll expenses between 150,000 and 399,000, or actually 399,000.

$999.99 to be specific.

That deduction was set to expire at the end of this year.

Legislation submitted with the budget would extend that to 2040 consistent with the expiration of the tax.

The expiration of that deduction had been assumed in the revenue forecast at an impact of about $5 million.

And so this adjustment, the proposal to extend that deduction, shaves $5 million out of resources in the Jumpstart Fund in the biennium and in the future year projections.

and we've talked about this.

So this is the other side of the homelessness funding swap, $47 million increase in 27 and 28, shifting homelessness programs, expenses that had previously been funded in the general fund into the Jumpstart Fund.

And then, as I mentioned, there was an assumption in the general fund last year that funded shelter costs in 27 and 28. This reflects those costs, however, they're being added into the Jumpstart Fund, $18 million in 27, $18 million in 28, to build and operate shelter for people experiencing homelessness.

So those are the major changes.

There are some other minor changes that, again, they will be discussed in department presentations, either memos or presentations here in committee.

So this is the kind of high-level look of the Jumpstart Fund sustainability.

It's a bit different.

I'm not showing graphs because the Jumpstart Fund was balanced last year.

It's balanced this year as well in terms of the projection and the budget.

But this is really most helpful to show you two things or three things.

One is the revenue stabilization account, that line in red.

I mean, it shows as a negative, but that's just basically a kind of a hold on resources.

It increases from the 26th revised level of $9.7 million up to its full policy level by 2029 of $44 million.

At the end of 27, it'll be $20 million.

At the end of 28, it'll be $31 million.

And then the ending unreserved fund balance.

So this is the key part.

You can see the $101 million of better than expected resources at the end of 26, and you can see how it steadily declines.

So essentially they're using that balance to balance the fund of 27 and in 28, and then by 2029 that fund balance has been used up As part of the fact that the fund balance has been all used up, there are changes that will be necessary in the Jumpstart Fund.

And again, this is not a decision to be made.

This is just a projection, an assumption being made, the executive of how they would meet that challenge by 2029 if all these various embedded assumptions hold true.

and you can see that in the expenditures line, the expenditure row going from 28 to 29 drops by about $30 million and that's a result of a few different things going on.

One is a portion of the homelessness funding that shifted will shift back to the general fund, $24 million in 2029, $30 million in 2030 and a number of reductions at the department level.

Reductions in 2029 and then a slight add back in 2030. And these are really just shown as part of the sustainability requirement in the Seattle Shield bill, requested that if there were reductions that need to be made to keep the funds in balance in the future, what are those?

And then these are essentially what those would be if all the assumptions hold true.

And again, the assumptions will change up or down between here and then.

This is just a look at what would be required to balance the fund.

So essentially, there's a $19 million reduction in 29 in total, and $10 million that gets added back in 2030.

Tom, I want to just clarify that statement you made, which is $19 million of cuts would be necessary in 2029. That is assuming that the economic forecast remains constant with no changes.

Is that correct?

Absolutely correct.

So if we are able to spur construction in our city, that number in and of itself is reduced.

or if we have a stronger national or statewide economy, that number would also be reduced.

Is that correct?

Yes.

However, it would require that those changes impact payroll expense paid by large companies because this is fully funded by the Jumpstart Payroll Expense Act.

But more to say, if you pull back and you treat the Jumpstart Fund and the general fund as part of a common resource pool, yes, absolutely.

And so what you are noting here is that while we have had a general fund structural budget deficit, we now have a Jumpstart Fund structural deficit.

Is that what you're calling out here?

I'm calling that there is a structural deficit in both funds until a certain point in time.

The general fund resolves on its own after applying fund balance for a number of years.

The general fund does.

The jumpstart fund, on the other hand, requires additional measures in order to meet that standard in the future.

Thank you.

So while we have a general fund reduction down to $9 million, we have increased the jumpstart deficit to 19.

Essentially, yes.

Essentially, by 2030, $19 million.

And additional measures would be necessary.

I see Cal trying to jump in.

And sorry, colleagues, for going off my typical facilitation.

I just wanted to dig into this a little deeper.

Yeah, I think it's important to highlight that this is a projection.

So this is looking at, you know, we do have general fund and jumpstart fund, which are essentially both the most flexible revenues we have.

And so a bit of this is trying to look at that as sort of a common resource pool and how that has to go back and forth across the two different funds.

This is just a current projection based on what the forecast look like for what that might look like for out years.

That will change, absolutely, by the time we get there.

But as long as we are accounting for these funds separately in this way, we will continue to see these things.

And, you know, there's gonna be a...

At some point, if the funding is for the same things, you should look at them together.

Thank you, and apologies, colleagues, for going off my typical facilitation.

Tom, I'm gonna let you take away for the rest of this presentation, and then we'll take comments, questions from colleagues.

Okay.

So that's the end of all of the detailed tables.

I just have a couple, just basically two general high-level policy considerations.

One is, despite that we have seen that there's still a structural deficit, it's much, much smaller.

This proposed financial plan with the general fund has improved over what we've seen in the past few years.

Particularly in contrast to the one we published with the 2026 adopted budget.

In contrast to last year's plan, which had a large fund balance that was supporting spending, this plan uses the available balances to kind of bridge smaller deficits over a number of years to achieve sustainability in the future.

Also in contrast to the past, the one-time reductions are not being used to support ongoing creases.

In fact, it's the opposite.

There are larger ongoing decreases than there are ongoing increases, so that helps sustainability in the future.

And as we've covered, the reserves are funded at their policy levels, and the Jumpstart is nearly at its policy level.

All good things.

but we've also been talking about there's a kind of a glide path that's assumed and it's not entirely smooth.

There are some potentially difficult decisions.

Again, to kind of echo on what Cal's saying, these are all projections, but if all projections hold true, there will be some decisions that will need to be made within the Jumpstart Fund.

They're showing it in the Jumpstart Fund.

It could be made elsewhere in the general fund as well to handle that challenge.

One thing I would point out is that since the Jump Start Fund was created, it was initially created with really hard and strict spending constraints.

moderated in the policy adjustment in Ordinance 127155. And so now they're just guidelines.

And also, it can generally be used to help with general fund spending.

And in fact, the proposed budget does that.

It shifts a program from the general fund to the Jumpstart Fund, which is a bit new.

It's a new thing.

Normally, we've moved money by way of the transfer between funds.

which may be fine.

But I'm just going to point out that kind of the budget is where that, you know, if that's the correct approach to be handling these funds, then that's what's reported today.

If an alternate approach is desired, that decision could be made as well.

And that concludes my presentation.

Thank you, Tom.

Well done.

Colleagues, questions, comments, concerns?

All hashed out in the general fund section.

Councilmember Rivera, vice chair.

Thank you, chair.

Thanks again, Tom.

I just really appreciate your analysis.

I mean, one thing that I really just want to call out is that I appreciate that our structural deficit and the actions that were taken by the executive to try to address the structural deficit.

The reality though is that it does hinge on taking out a lot of the one-time things that we added that were important to council.

And so I think that now we're in a position or council is in a position that if we want to put in one of those one-time ads that we had before, then we're in a situation where we have to either, you know, we have to cut something to add something.

So I just say that for the folks who may be watching that, there are a lot of things that this council really put in last year in response to some of the constituents' priorities that then there's no room for in this current budget or unless I don't know what I don't know.

So let me say that too.

I don't know if there's some funding to be had somewhere.

So I think that's conversation will come.

But as it stands today, it looks like in order for us to add one of those things that that constituents care about, we're going to have to either we're going to have to cut something that is already in the budget, and that's just a reality.

And I say that because it's important to note that the executive and the council are two separately elected bodies.

We have similar constituents, but we are separately elected.

So our constituents might ask the mayor for something that the mayor may or may not include in the budget, and then they will come to council their representatives to also request the same thing.

if it didn't make it into the executive's proposal, then it lands on our laps and then we're in a situation where if we make an ad, you know, we are seen as adding perhaps to the structural deficit.

So that's important because at least for my part, I've tried every year not to increase the deficit, it is a challenge and folks should be aware that that is now what council has to balance.

So we are not seeing like somehow we're being fiscally responsible because after all, it is our job to balance a budget and ensure that our constituents' interests are represented.

So really that wasn't a question, it was a statement, but I think an important one in the context of this conversation and the context of next week's conversations about amendments as we all grapple, all nine of us, with what our constituents might want to see in the budget and how we go about addressing those.

So thank you.

Thank you, Chair.

Thank you, Councilmember Rivera.

Tom, anything to add there?

I would only add that there will be one potential opportunity for new resources to be available, and that is the upcoming October, the third forecast of this process that will be presented by the Office of Economic Revenue Forecast and the City Budget Office on Friday.

And I will then counter with if that revenue forecast comes in negative, we will have a very difficult job to do because while we do have our reserves replenished, that is all we have right now.

And so if we do have a negative revenue forecast, we will have a very unpleasant next eight weeks or next six weeks.

You know, that said, I see, okay, so I see Council Member Foster and then I'll take my final questions.

Council Member Foster, thank you.

Thank you so much, Chair.

I really appreciate that.

I wanted to just go back to the top really quick for clarity.

I'm looking at slide one, Tom.

Slide one?

Yes, slide one.

So this shows us the $149 million and the $129 million deficit that was previously projected around this time last year for 2027 and 2028. And I just want to make sure it was my understanding that those two numbers looked at the structural budget deficit, but did not assume that any ads through the council budget process last year were included in those numbers.

So I'm trying to remember who was at the table.

It might have been when CBO was at the table.

I think we got a number that it was 78 million in one-time ads that were from Council last year.

It was my understanding that those ads were not included in that 149 number.

Is that correct?

Councilmember Foster.

So I will just say, I don't know the precise number, but it sounds like they're suggesting that one-time money that was added in the 26 adopted budget is not part of the projected deficit for 27 and 28, which is accurate.

Thank you.

Were you going to say something, Director Whitson?

Some one-time ads were extended and made ongoing in the mayor's proposed budget, so it really depends on the specific budget item.

Yeah, thank you.

So what I'm trying to get at, I just want to make sure, you know, I have the right understanding, which is that last year when it was assumed that it was about $149 million deficit, that assumed that those ads were one-time, so they weren't accounted for in those out years for 27, 28, and 29. And had they been accounted for in those out years, we would have been looking at an additional 70-something, I can't remember, and I don't have my notes in front of me, million on top of that existing forecasted deficit.

And then some of those ads, I think this isn't to speak on the value of those ads, to be clear.

I think many of them were really important, OIRA funding, Fresh Bucks funding, things that we all care about, just for an understanding of the forecast here.

So had those been included, that would have been increased to represent those being ongoing.

In the mayor's budget, my understanding is she included, and I can't remember the number here, somewhere between 10 and 15 million of those one-time ads in the ongoing, so some of them are included.

I just want to make sure we have that right for the record.

That's correct, and that ad, the mayor adding back that one-time stuff, would have shown up as a mayor's operating proposal for 27 and 28, so it's not part of the baseline projection.

The projections the CBO does, you know, as kind of putting the financial plan together to the book, they look at what's tagged as ongoing, and they project deflation on top of that.

Anything that's tagged as one time drops out in the next year.

Thank you.

I just wanted to clarify.

And then this second part, I'm sort of leading into this.

It's a follow-up on my earlier question about the requirements for the outlook into the future years.

So you already clarified for me that when B&O passed last year, the B&O reform passed last year, we had this requirement that the mayor would send down the budget balanced and then with a forecast for it balanced out into the next five years.

Do we have a requirement as we go through our budget process, like if I make a one-time ad or if I make an ad through the budget process, looking at you, Chair, that, you know, it's going to have multiple millions, you know, 27, 28, 29. Do we have the same requirement that, as passed by Council, we're balanced in those out years?

Councilmember Foster, my read of that ordinance does not require that the Council has to submit a balanced financial plan in the future.

Okay, thank you.

Thank you, Chair.

Yeah, thank you, Councilmember Foster.

Bringing us back just to last year, helpful context, because as Councilmember Kettle added that six-year financial outlook as an amendment to the B&O tax reform, it is absolutely good practice in what we should be doing.

I think everyone that was here was also aware that making that type of shift, so I still drive a manual car, switching those gears so rapidly may not be achievable for this year.

So I applaud Director Panucci for taking a better effort at it than I think we were expecting.

So we absolutely appreciate that.

And I will also say that in those out years, this is the difference between coming to a fiscal cliff or a fiscal hill.

It has been my objective over these last number of years to roll us slowly down the hill so that we are not jumping off of a cliff.

Because if we tried to make 10 years worth of financial, it took 10 years of growth to get into this fiscal situation.

If we tried to address all of those changes in one year, we would be cutting off programs that we need before making those changes.

And so what I see in this last year, the difference between one year and ongoing funding.

Last year, council changed the $4 million in Office of Immigrant and Refugee Affairs.

That $4 million was one time and the council made that ongoing.

That increased the structural deficit by $4 million.

I included the money for vehicle and vehicle residents and RV mitigation.

I called that ongoing from the first day because I knew that it would be ongoing.

There are other programs that are also incredibly important that were set up as one time to test to see if they would work or not.

And I think that without additional coordination, we have received a budget that just removes most of them.

without that careful consideration of council priorities of was this a very important project that we needed to keep momentum on or not.

And so it's a challenging budget to go through, but that's what I mean of my concern that we are stopping the positive momentum of the city is that there are important programs in here that need to have higher levels of funding than what has been proposed.

Colleagues, any other questions right now?

Seeing none, I guess I already talked about it, but if you want to go back to slide three, Tom, this is just where I will ask you again, if we suddenly had greater levels of construction in our city or that comes through construction sales tax, that also comes from the property tax that we can get on top of the 1%, What happens with, well, you could use this one, but I'm fine with slide three that shows a bigger difference, but what happens here?

I mean, if you could use slide three, because that's a worst case scenario than what you got here.

Slide whichever one I was on is the one that we're working with right now.

That's correct.

Slide three is old news.

So I would suggest...

Sir, Tom, this is...

I'm asking about slide three today.

Okay, very good.

So this is, and something else that I wanted to share that coming from Council Member Foster, last year, my chair's package reduced the structural budget deficit because we did not use all of the funds that were available to us.

We included more funds and reserves, whether that was the COC or the Federal Reserve, and we, we made sure to leave funds available because we saw some of this coming.

But let's say from November of 2025, which was a full year ago, So, you know, it would be nice if we had a civic project such as Climate Pledge Arena that Ken Johnson built or the Convention Center or...

light rail construction or any of these big, or the West Seattle Bridge construction, all of those civic construction projects were helping us in the previous years.

What happens here if we have another civic construction or our free market construction increases?

I mean, depending on, Chair Strauss, depending on when that occurred and when the revenues came in, one would logically, and all other assumptions held the same, revenues would be higher and so the gap would get smaller.

Thank you.

Fantastic.

Council Member Rivera, last word, and then we're gonna move on to the next presentation.

Thank you, Chair.

I'm just confused by something you, by this particular slide.

Tom, I thought you said this was an old slide.

The new slide is actually on page 10, correct?

Yes.

Okay, so we're-so we should be really looking at 10 and having that question answered, because how- Yeah, I think if I could-I think it's-I'm reading what the Chair was going just to show how the gap gets smaller.

The other chart-the other graph doesn't show a gap necessarily, though there is a small one, but the dynamic is the same.

It's fundamentally the same as to whether or not some favorable economic event leads to increase in revenue and what that- Correct.

Correct.

But I just also- In either case, in either graph, it decreases the gap.

Correct.

But for anyone watching, I also don't want to confuse people that where we're at today, the projected today is page 10, so it's a much smaller gap than we were showing before.

Accurate.

Correct.

Yeah.

Thank you.

Thank you, Tom.

Thanks for the clarification.

Thanks, Chair.

Fantastic.

Colleagues, any last questions?

Seeing none, we will move on to the next agenda item.

And clerk, will you please read item four into the record?

Please read item three into the record.

Agenda item three, voluntary separation for briefing and discussion.

And just as Karina gets settled, I'll maybe steal some of the thunder here, which is that this is an allowance, not a requirement, and does not specify how this program would work.

But if this program was set up over the course of the future, it would require this allowing ordinance.

Did I get it right, Karina?

You got it right.

Thanks for the intro.

All right.

Over to you.

Well, it's still good morning to all of you today.

I am Karina Bull.

I'm on Council Central staff, and as Chair Strauss set up, I am going to be reviewing transmitted legislation from the mayor's office that would authorize the director of the Seattle Department of Human Resources to offer a voluntary early separation program, otherwise known as an early retirement incentive.

As background, the city may offer such programs to allow employees more flexibility in choosing when to retire and to also reduce long-term labor cost.

Previously, the city offered such programs in 2002 and 1996 to mitigate layoffs and reductions in the following year.

The 2002 program offered eight weeks of pay as an incentive that could be received as a lump sum or in combination or a loan as applied toward the purchase of up to four years of retirement credit, contributed to a deferred compensation program, or applied toward the purchase of up to 18 months of healthcare at the city's COBRA rate.

The 1996 program offered payment of one week's salary multiplied by years of service not to exceed $30,000.

It also established a seniority system for considering applications in case more employees requested to participate than could be accommodated.

Council approved these programs in the summer before or kind of concurrent with the initial application periods.

because in those instances, the SDHR director was not previously delegated authority to develop these programs.

It was transmitted as regular legislation.

This legislation would amend the Seattle Municipal Code 4.36, that's the section of the code that governs the Seattle City Employees Retirement System, to delegate that authority on a permanent basis to the SDHR director to offer eligible employees, so this wouldn't cover department heads or temporary staff.

It would authorize the director to offer a voluntary early separation to those eligible employees.

It would be subject to certain criteria, certain parameters, but not setting the substantive details.

And as I mentioned before, this would be a permanent delegation of authority, so not just limited to developing a program for 2027. The SDHR director would be required to coordinate with certain city officials, the director of CSRS, director of finance, director of finance and administrative services, and the city budget director.

The director would also need to make certain program information available to employees for at least 30 days before the program enrollment ended.

including eligibility criteria, opt-in instructions, description of the incentive, and explanation of impacts on health insurance and other benefits.

If council does not approve this legislation, the SDHR director could still develop a voluntary early separation program within its current delegated authority, but would be required to transmit it to council for approval to offer and implement it.

As far as fiscal impacts, similar to other personnel legislation that you've considered in the past, there would not be direct financial impacts from this legislation as it authorizes but does not require the SDHR director to offer this type of program, nor does it establish the substantive details of this type of program, for example, the amount and the type of payout.

However, implementation could both incur administrative costs and potentially result in long-term savings.

While the executive has not shared substantive details of a 2027 program, the City Budget Office has floated an estimated cost of around $8.8 million.

That would be 6.5 million for the incentive payouts and 2.3 million for sick leave and vacation leave payouts above normal.

The program would also impact the retirement department as it could have as much of four times as much work between the application and separation periods.

CBO believes that departments would have sufficient vacancy savings to afford these payouts and that no additional appropriation authority would be needed.

After accounting for these administrative costs, savings could result from vacated positions that remain open or are filled by new employees at a lower cost.

Vacated positions could also be unfunded or removed by council in a future budget process.

CBO does not anticipate savings from this type of program in 2027 due to the cost of payouts, but in 2028 and beyond, CBO aims to save around $8 million general fund per year ongoing.

And as far as some of the details that aren't included in the memo, City Budget Office has calculated that about 1350 employees would be eligible for retirement in 2027 about 169 of these employees could retire without an incentive.

With an additional incentive, we don't yet know what it is.

CVO estimates that 279 employees could retire, meaning that the incentive could result in 110 more retirements.

and CBO based these calculations on their analysis of the 2002 Retirement Incentive Program and similar programs in other jurisdictions.

Also worth noting that CBO acknowledges that the incentive would ultimately pay out employees who already plan to retire anyway.

However, the goal is to advance some 2028 and 2029 retirements ahead of time for a one-time bump in vacancies.

As far as policy considerations, the benefit of having the SDHR director have authority to develop this type of program is that the executive could potentially develop and implement it on a faster timeline and would have more flexibility in meeting bargaining requirements for represented employees.

The trade-off is that council would not be involved in development of the program, for example, through the Select Labor Committee's consideration of bargaining parameters, if that is applicable.

There are some legal considerations there, so if you would like to discuss that further, I'm happy to do that offline.

And council also might have notice of a separation program until the director's formal announcement, because no legislation would be required to offer and implement it.

Something to consider is that the legislation could be amended to formally require some notice to counsel before the SDHR director would implement the program.

That could take a variety of formats.

It could require the director to consult with the budget chair prior to implementation.

That could be an offline meeting.

There could be a requirement for a public briefing on the draft program before it is offered to the appropriate council committee or to the council at large for a full council briefing.

The tradeoff of these requirements could be a slower process that delays the director's intended timeline.

So there are some things to consider with adding some level of formal notice to the legislation.

Next is a potential proviso which could be implemented separate from this legislation on the entire budget to restrict the executive spending on a voluntary early separation program.

An example of that kind of proviso is that it could limit the amount of money spent on payouts to implement the voluntary early separation program in the following year's budget.

The benefit of that is that creates some certainty on the budget.

The trade-off is that it actually could end up limiting the amount of payouts to employees which could result in fewer early separations.

So again, more things to consider there.

It is an example of how council could assert its authority in this type of situation.

Last, something that is not mentioned in the memo and in this presentation is that if councils' priorities more for temporary delegation of authority.

There could be legislation and ordinance separate from this one that doesn't permanently amend the Seattle Municipal Code, but gives a delegation of authority to develop and offer a program solely for 2027, and that could be considered as budget legislation.

So that is the end of my presentation.

Thank you.

Karina, real quick in debrief, this program, if implemented, would cost more money upfront but could achieve long-term savings.

Is that accurate?

Accurate.

City Budget Office is saying $8 million savings of general fund ongoing.

after- Right.

So not just 2028, it would be thereafter.

So it is more expensive to implement now, but helps in the long run.

I will just say that this has been something that has been important for me that we at least consider because if our fiscal situation is so bad that we're laying off city employees, we need to be We need to have this on the table as well is the best way I can say it.

So colleagues, questions?

I see Council Member Lynn followed by Rivera.

Just in terms of timing, I'm assuming this type of program, you have a time limitation to it.

Otherwise, it just kind of becomes part of your standard.

retirement and that you're trying to incentivize sort of the early retirement.

So there must be some presumably end date to when you stop offering the early retirement.

In implementation, yes, there would be an end date.

It's not in this legislation because that would be something that the executive would bake into their program when they roll it out.

I can imagine that, as happened in previous separation programs, there's an initial application period that could be anywhere from two weeks to 30 days or longer, and then that is when employees voice their interest.

I would like to be considered for this program and my eligible.

and then after that period then CERS would get to work on making those determinations and meeting with the employees and then there would be a formal period where the employee, if accepted into it, they would have to declare their intention to actually retire by a certain date and so it would be up to the executive to decide when that date would be.

If it's before the budget, then the executive could include those savings in the budget that is transmitted to council.

And I will add that for employees who choose to apply to the program during the initial application period, they're not held to that.

It's just them voicing their interest.

And then the formal decision, which would be irrevocable, would happen later on in the year.

And then in the previous programs, there was a two-year prohibition for coming back to the city for employment after retiring.

Thank you.

Cal, Deputy Director.

Yeah, I just wanted to add that, you know, it creates the potential for savings, but it means that you have to give up that position in the longer run to actually achieve those in the long term.

So, you know, it is largely talking about giving that space, and then those decisions will have to come forward in future budget years as well.

One thing I'll point out is that the City Budget Office is framing this not necessarily as giving up that position.

It's the way I'm hearing it described as creating opportunity to remove that position, but also to have the position filled by a new employee, which could be someone that is paid less than the incumbent right now.

So there's different opportunities here with the early retirements.

And when we've done this in the past, or do you know if there's any thinking about it, is this citywide or is it by department?

Yeah, those are the sorts of details that we don't know because it would be up to the SDHR director to decide.

Is this just a retirement program for one department or the full city?

I imagine it would be the full city.

But I can't speak for them.

I don't know yet.

Yeah, and then just final question.

In terms of like, I don't know if we've done this in the past, when we did this in the past, or again, what the thinking is in terms of making sure we're not losing that sort of critical institutional knowledge and that we're passing on projects.

I think when there's an early retirement and somebody's been working on and they hold that information for decades, making sure there's appropriate planning in place to transfer that knowledge or to have somebody else take on that project.

I don't know how we've done that in the past, but just any sort of thoughts or thinking there?

Yeah, so that could...

be baked into whatever is offered to the employees or maybe even into this legislation about opportunity to consider that type of impact.

It commonly can be referred to as the brain drain if there's a lot of people retiring all at once that have an incredible amount of institutional knowledge and skill with the city.

I'm thinking about the 1996 program that had a seniority system that would be allowed to be put in place if the department determined that there was too much interest within a given classification or a department.

If there's employees who have been in the same classification for the same number of years, if you have all five of them within a six-person team decide to retire, that has impacts that would not be beneficial necessarily for the department.

So I don't know what that would need to be in the legislation, but it certainly could be something that the SDHR director could make into the final program.

Thank you, Chair.

And just on that last point, we're going to hear, I think, a little bit later on some delays and from SDCI in terms of, like, implementing statewide regulations around, like, our shoreline management program or critical areas.

And I've heard partially, you know, part of that delay could be because of, you know, this brain drain from a long-time employee and and just concerned about wanting to be thoughtful about that.

But it obviously could be a very useful tool and I suspect something that our employees and unions would be supportive of.

So thank you for bringing this forward.

Thank you, Councilmember Lin, and thank you for a good set of questions that cannot necessarily be answered today because this is simply enabling legislation for all of that implementation to come down the road.

With that, I see Councilmember Rivera and then Councilmember Rank.

Thank you.

Thanks, Karina, for taking us through that.

So basically what this legislation would do was council is delegating their responsibility to the executive and then what is of concern here is that every time council delegates their responsibility to the executive or any other body for that matter is now we no longer are in the decision making process or in the process.

So down the line, you know, the unintended consequences of into the future is we're not going to know when these things happen till post facto, till they get published, for instance.

Rather than us, because we've approved in the past, both you have here in O2 and in 96, we've approved a voluntary separation program.

They're a great idea.

You know, rather than have, we don't want to have to lay off employees if people voluntarily separate, that's advantageous.

So I don't see why we are, considering legislation to delegate our responsibility to the executive when we've done it twice before without issue and in both instances we've been part of the process so we know what the proposal was, when it was going to get implemented, how much it would cost, et cetera.

So for me, it seems like one of the benefits of delegating the authority is a faster timeline.

So if this is approved, if this legislation is approved as part of the budget process, depending on where the executive is and its development of a program, it could be offered very soon in the new year.

If this were to be legislated, the new year would probably have legislation to offer and implement it, just as in the past, and maybe it wouldn't get offered until later on in the year, whenever that time might be.

And as you say, what this legislation does is removes the Council's ability to review it and perhaps even tweak it before it's offered to employees.

And the review and the tweak is really an important piece of this for Council.

So it's not something we should just gloss over.

And I also think that if the executive was proposing this, they had plenty of an ample time to develop something that we could have considered as part of the budget process.

There's other pieces of legislation that we consider during the budget process.

And so this could have been one of them.

So I guess I'm confused and I had heard that this was going to be a proposal.

So I'm confused that we don't have an actual proposal before us, but rather an ask to delegate our responsibility to the executive so they can develop a program and implement it outside of the council process.

So that's of concern to me.

And all couched in this somehow, it'll be faster if you just let us do it.

When, as I stated earlier, they could have had the proposal as part of this budget process.

Here's what we proposed for separations for 2027 or even the biennium and given us the opportunity to, as you say, tweak it if there was something there that we were concerned about.

So this is a piece where I have concerns when things are couched like somehow there's going to be some huge delay and that's why we're doing things outside of how we normally do them and taking away a responsibility of the council that then we on the back end are frequently having to correct for because of the unintended consequences.

That's hard always to be on the back end trying to fix something because we didn't know what the unintended consequence was going to be.

So while we would, I don't know anyone who wouldn't support a voluntary separation program.

I do think that is not onerous to have council consider review, amend if necessary, the program before it moves forward.

Thank you, Chair.

I do want to clarify one thing that I said.

I do want to clarify Council's role in reviewing and approving it, if this were to come to Council as a proposal, in that because there are potential bargaining impacts here, that might not be the time for council to make any changes or to any modifications to it when it's already sent over as legislation.

So to the extent that the Select Labor Committee would be involved in bargaining impacts, that could be an opportunity for council to be involved if that's applicable.

But since the city historically offers the same kind of payment and benefits and incentives to non-represented employees as represented employees, there would be potentially less of an opportunity to modify that once it's transmitted as legislation.

So it's something to consider.

complicate the ability to amend a proposal in a different way that is not necessarily true for legislation that does not involve represented employees.

Thank you, Karina.

At the end of the day, we don't always know ahead of time.

When we delegate our responsibility, we don't always know ahead of time what's going to happen.

And then often on the back end, we didn't know that was going to happen.

And then do we need to do something to correct it?

So this has been done twice before without issue.

I don't know why we would have to change how we do this, which is SDHR directors within their authority today to create a program and it's a matter of sending it to council for their review and approval and I don't think it needs to have the timepiece is Theoretical in my mind because it doesn't have to be this lengthy piece associated with it and I don't think this is something we can have the offline conversation about my separate concerns about bringing up the select labor committee as a piece where some things might be revealed.

But at the end of the day, we've done this without issue in the past through the council process.

And I don't know why we would today then turn around and delegate our responsibility to the executive who we have no control over.

and we often do not know, there's a lot council doesn't know that department or there's a lot council does not know about what departments are doing until post facto and that is a difficult position for council to constantly be in and so to me that's the unintended consequence of this particular ordinance and it doesn't have to be set up this way to create this program.

We've done it before.

I just don't see, what is it that we're trying to solve for?

I don't think this timepiece has been demonstrated to be an issue in the past for why we would just delegate our responsibility to the executive.

Thank you, Chair.

Thank you, Councilmember Rivera.

Colleagues, I see Councilmember Lin.

Is that old hand?

New hand.

New hand.

Take it away, Councilmember Lin.

Thank you, Chair.

I'm just curious.

It's a little bit surprising to me that it was last offered so long ago, even though we've had sort of major economic downturns since then.

And so I'm just wondering, was there some reason Am I reading this correctly that we haven't offered such a thing since 2002?

And if so, why not?

Have there been complications with trying to offer the program?

Or did we just not find it wasn't necessary?

Yeah, I don't know the answer to that.

And my research just showed 2002 and 1996, but I didn't see anything after 2002. I certainly can ask for folks who have been in CBO for a while if there's institutional knowledge and central staff as well as to why that hasn't been explored in those intervening 24 years, but I don't know.

Thank you.

Thank you, Councilmember Lin.

Colleagues, I don't see any other questions or comments at this time.

And so we are at a natural stopping point at noon.

We may actually take lunch at noon for the first time ever.

But before we do that, I do wanna just see any other questions, comments on early separation.

It is something that requires additional and further discussion about how we create this allowance or if we do it all, which is one of the options.

I look forward to all of the ABCD options as we move forward through central staff analysis of the budget.

So seeing no further questions on this, I would like to bring forward this proclamation honoring the Seattle Chongqing Sister City Appreciation Day, which has been emailed out to all offices last week.

I will address the proclamation as we come back and we present it after lunch at about probably 1 20 p.m.

Seattle and Chongqing have been sister cities since 1983, and that close relationship has seen over 200 organized exchanges in education, arts, medicine, science, and more.

You may know that Chongqing is the largest worldwide producer of Lenovo laptops, and those laptops would be nothing without our Redmond-based Microsoft.

Granted, Redmond's not in Seattle, but it's pretty darn close.

They've also been engaged in the development of the Seattle Chinese Garden, which is the only Bayou-style Chinese garden in North America and was built with exacting Chinese workers who made sure to do it in an authentic fashion.

And there's also been a strong exchange between China and the Woodland Park Zoo, such as the 1986 loan of a pair of golden monkeys.

So it's a great opportunity to continue celebrating our ongoing partnership and would love to have everyone's signatures affixed.

And if Council Member Juarez joins us after lunch, we'll just add her name.

But just want to check to see if there's any questions or comments on this proclamation.

Seeing Council Member Lin.

Thank you, Chair.

I just wanna say that I'm very excited about this.

My grandparents were married in Chongqing.

My dad was born right outside of Chongqing.

This was during World War II, during the resistance of the Japanese invasion of China.

and so just a very special day and thank you for bringing this forward.

Thank you, Council Member Lin.

What a great, I didn't know that connection.

Colleagues, you may know that in World War II, the Chinese government was centered, headquartered in Chongqing, China and General Stilwell of the American forces and Senator Ted, somebody help me out from Alaska.

Ted Stevens.

Thank you, friends.

Senator Ted Stevens flew missions into Chongqing to help save people's lives in Chongqing.

So if not for George Stilwell and Senator Ted Stevens, we might not have a council member line.

With that, if there are no further comments on the proclamation, will the clerk please call the roll to determine which council members would like to affix their signatures to the proclamation recognizing October 13th, 2026 as Seattle Chongqing Sister City Appreciation Day.

Councilmember Saga?

Aye.

Councilmember Foster?

Yes.

Council President Hollingsworth?

Yes.

Council Member Juarez.

Council Member Kettle.

Aye.

Council Member Lynn.

Yes.

Council Member Rink.

Yes.

Council Member Rivera.

Aye.

And Chair Strauss.

Aye.

Eight signatures will be affixed to the proclamation.

Thank you.

And with that, colleagues, any further questions before we recess for lunch?

I will say we will come back here at, I'll give us 1-10.

So we've got an hour, 65 minutes for lunch.

So if there's no further, no objections, we council select budget committee will be in recess until 1 10 PM.

Thank you colleagues.