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Real Briefings

Committee of the Whole

BEL-CTW-2024-09-30 September 30, 2024 Committee of the Whole City of Bellingham
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The September 30th Committee of the Whole meeting was dominated by substantial policy discussions across three major areas: the city's fiscal crisis, tenant protections, and housing development incentives. Mayor Kim Lund presented her 2025 budget proposal, revealing the city faces a $6 million ongoing structural deficit despite creative revenue strategies and targeted cuts. The budget employs temporary fixes including shifting sales tax allocations and tapping pension reserves, while adding strategic positions in public safety and internal services. Council Member Jace Cotton's junk fees ordinances generated extensive debate, with the proposed regulations targeting excessive rental fees that burden Bellingham's cost-stressed renter population. The ordinances would cap late fees at $10, limit pet deposits to 20% of monthly rent, and require fee transparency in advertisements and leases. After lengthy discussion about enforcement capacity and policy specifics, the measures were held in committee for further development and public engagement. The Multi-Family Tax Exemption program evaluation revealed that the city's current 12-year affordability requirements (60-80% AMI) are too restrictive, resulting in zero uptake despite 1,400 units produced under the 8-year program. Consultants recommended raising AMI thresholds and expanding target areas to increase feasibility while maintaining some affordable housing production. The meeting concluded substantive immigration policy work by approving creation of a Keep Washington Working Act advisory group while dissolving the Immigration Advisory Board, representing a shift toward focused compliance review rather than ongoing advisory functions.

**Junk Fees Ordinances (AB 24253 & 24254):** Motion by Lilliquist/Williams to hold both ordinances in Committee of the Whole passed 7-0. No final action taken; items returned for further public engagement and refinement. **SCORE Jail Contract (AB 24267):** Motion by Williams/Huffman to recommend approval passed 6-0 with Cotton abstaining. Renews interlocal agreement allowing Bellingham Police to transport arrestees to South Correctional Entity in Des Moines when local jail space unavailable. **Keep Washington Working Advisory Group (AB 24256):** Motion by Williams/Anderson to recommend approval as amended passed 6-0 (Hammill excused). Creates limited-term work group to study city compliance with state immigration law and re…

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**Fiscal Crisis Management:** The 2025 budget proposal represents a sharp departure from recent spending patterns, employing multiple one-time revenue strategies to address a structural $6 million deficit. Longman's presentation showed declining sales tax revenues with five of nine 2024 tax periods falling below 2023 levels, creating what the mayor termed an "existential crisis" for city services. The proposed solutions include shifting sales tax allocation from streets (37% to 32%), temporarily diverting firefighter pension surpluses, and consolidating investment interest in the general fund. Anderson questioned the sustainability of these moves, while Lilliquist noted the long-term trend of reducing transportation funding through sales tax reallocations. **Tenant Protection Strategy:** Cotton's junk fees ordinances sparked detailed discussion about balancing renter protections with enforcement capacity and landlord compliance costs. The ordinances would prohibit numerous fee categories including administrative fees, nonrefundable pet charges, and appliance rental fees while capping others like late fees ($10) and pet deposits (20% of rent). Williams advocated for data-driven policy based on local problems rather than following other jurisdictions, while Anderson supported the concept but questioned specific penalty levels and enforcement language clarity. Lyon estimated enforcement would require approxima…
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**Mayor Kim Lund** emphasized fiscal responsibility and one-city governance approach, describing the budget as a "temporary bridge" requiring future revenue solutions or service reductions. Warned that dipping below emergency reserves would impact the city's credit rating and borrowing capacity. **Council Member Jace Cotton** positioned junk fees regulation as urgent housing crisis response, citing evidence that late fees don't improve payment rates and arguing for protecting cost-burdened renters. Advocated for moving "nimbly" on tenant protections despite enforcement challenges. **Council Member Lisa Anderson** supported tenant protections but questioned specific fee caps and enforcement mechanisms. Expressed concern about opening Roosevelt neighborhood to development incentives due to displacement risk. Advocated for parking minimum reductions tied to affordable housing requirements. **Council Member Michael Lilliquist** strongly supported MFTE program reforms, acknowledging…
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**Mayor Kim Lund, on fiscal reality:** "There remains a disconnect between the city's level of service and our available resources. Going forward, my administration, all of you on the council and the community will need to work together to establish new, sustainable and flexible revenues or make the difficult decisions to reduce services." **Deputy Administrator Forrest Longman, on revenue trends:** "We've seen five of our nine tax periods have been less than the comparable period in 2023... …
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**Budget Process:** Work sessions scheduled every Monday in October plus first Monday in November. Revenue forecast public hearing October 21st. Budget public hearings October 7th and November 4th. Budget ordinance introduction planned for second November meeting with passage targeted for first December meeting. **Junk Fees Ordinances:** Staff developing public engagement plan including Engage Bellingham platform and stakeholder meetings. Cotton working on amendments addressing council concerns. Return to Committee of the Whole when ready, potentially with public hearing before final consideration. **MFTE Program:** Staff cond…

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**Budget Strategy Shift:** City moved from biennial to annual budgeting with explicit recognition of structural deficit requiring either new revenues or service cuts. Temporary revenue strategies implemented including sales tax reallocation, pension fund diversions, and investment interest consolidation. **Tenant Protection Development:** Formal ordinances introduced targeting rental junk fees with specific caps and prohibitions, representing city's first comprehensive approach to rental fee regulation beyond state law requirements. **MFTE Program Recognition:** Official acknowledgment t…
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# Hard Choices and Housing Policy: Committee of the Whole Tackles Budget Crisis and Rental Reforms On a September afternoon marked by both financial reckoning and legislative ambition, Bellingham's City Council Committee of the Whole grappled with fundamental questions about the city's future. How does a community maintain essential services when revenues are declining? How far should local government go to protect renters from exploitative fees? And how can a city balance growth with housing affordability? The September 30, 2024 meeting stretched from 1:00 PM to 5:22 PM, though council had met earlier for an executive session. Council President Daniel Hammill presided over most of the session, though left early and was succeeded by Council President Pro Tem Holly Huffman. All seven council members were present for the bulk of the deliberations. ## The Mayor's Sobering Budget Reality Mayor Kim Lund opened the afternoon with what she called "hard decisions" reflected in her proposed 2025 budget. Standing before council, she painted a stark picture: Bellingham faced a multi-million dollar ongoing general fund deficit, flattening revenues, and what she termed "a legacy of debt now coming due." "Excellence in government means being responsible stewards of our constrained public dollars while making progress on key community priorities," Lund declared, framing the budget as "a temporary bridge to a more financially stable future." The mayor's proposed $543 million citywide budget represented a dramatic shift from recent practices. While maintaining critical services, it employed what Deputy Administrator Forrest Longman called "creative uses of existing resources" and "targeted reductions." The general fund alone faced a $1.5 million deficit, though when accounting for one-time revenues and temporary measures, the ongoing structural deficit reached $6 million. Longman's presentation included sobering charts showing five of nine sales tax periods in 2024 had performed worse than the comparable 2023 periods. "We are likely to miss our revenue targets by 2 to $3 million for 2024," he reported, add…
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### Meeting Overview The City Council Committee of the Whole met on September 30, 2024 to discuss major budget and policy proposals. The primary focus was Mayor Lund's presentation of the 2025 proposed budget, which includes a $1.5 million general fund deficit requiring significant revenue adjustments and spending reductions to maintain city services. ### Key Terms and Concepts **Committee of the Whole:** A meeting format where all council members participate but operate under more informal rules to allow detailed discussion of complex issues before formal voting. **General Fund Deficit:** The shortfall when a government's basic operating expenses exceed its primary revenues, requiring either spending cuts or new revenue sources. **Sales Tax Allocation:** The distribution of sales tax revenue between different city funds - currently being shifted from 37% to 32% going to the street fund, with more going to the general fund. **Junk Fees:** Unfair or excessive charges in rental housing such as administrative fees, pet rent, or appliance usage fees that exceed actual costs or are not clearly disclosed. **Multifamily Tax Exemption (MFTE):** A state program allowing property tax exemptions on residential improvements for 8 or 12 years to incentivize housing development and affordability. **Keep Washington Working Act:** State law protecting immigrant workers from discrimination and limiting cooperation between local agencies and federal immigration enforcement. **Area Median Income (AMI):** The midpoint household income for a region, used to determine affordable housing eligibility - 60% AMI for individuals in Bellingham is approximately $45,600. **12-year MFT Program:** A longer tax exemption requiring 20% of units to be affordable, but currently unused in Bellingham because the 60% AMI requirement makes projects financially infeasible. ### Key People at This Meeting | Name | Role / Affiliation | |---|---| | Kim Lund | Mayor of Bellingham | | Daniel Hammill | Council President | | Jac…
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Budget & Finance Land Use & Planning Government Operations AB 24252 AB 24253 AB 24254 AB 24255 AB 24256 AB 24257 AB 24258 AB 24267 Bellingham Police Department Echo Northwest Immigration Advisory Board Score Whatcom Housing Alliance Blake Lyon Cadence Peatross Forrest Longman Hannah Stone Iris Nott Jace Cotton James Erb Kim Lund Lisa Anderson Michael Lilliquist Skip Williams Affordable Housing Budget Finance Displacement Enforcement Policy Housing Development Immigrant Rights Junk Fees Keep Washington Working Act Late Fees Multifamily Tax Exemption Pet Fees Rental Housing Sales Tax