I’m pleased to be selected to be one of 15 members on the new Fiscal Sustainability Task Force for the city of Edmonds. My Edmonds News wrote about the task force several times recently:
and again in these two articles, which point out that both S&P and Moody’s have reduced the general obligation bond rating due to declining reserves and other concerns. Lower bond ratings result in higher borrowing costs for capital projects and also reflect concerns about long-term sustainability.
City Council delays decision on boards and commissions; approves tree code extension – My Edmonds News
S&P lowers Edmonds bond rating, citing ‘operational deficits and eroded reserves’ – My Edmonds News
Edmonds is not likely to fall apart tomorrow, and the ratings still begin with an “A” but point to long-term financial challenges that all municipalities in the state suffer from.
- Revenue sources grow more slowly than inflation. Property tax is a significant part of how cities are funded and it is limited to growing at 1%. You may have noticed that inflation has been significantly higher than this recently…
- When times are challenging cities often defer maintenance on roads, sidewalks, buildings, and other infrastructure. This payment eventually becomes due. For example, think about the painful repaving of I5 we will be enjoying for the next two years. Had the road surface over that bridge been maintained properly it would have cost less in the long run and we might not have had the lengthy traffic disruptions we’re enjoying now.
I’m looking forward to serving on the task force. I’m reasonably knowledgeable about public sector budgets and feel some personal responsibility due to a vote I took very early in my Legislative career, before I knew better. I wrote about that in the Seattle Times last year.