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Council slashes mayor’s property tax hike, calls for audit

LYNNWOOD, Wash., November 28, 2023—The Lynnwood City Council approved a 5% increase (or $225,000) to the property tax levy, down from the mayor’s proposed 22% figure, during its business meeting on November 27. Council members call on a third-party audit to rein in city spending.

According to Finance Director Michelle Meyer, this is roughly an $11 a year increase based on the average home price in Lynnwood of $643,000. This is down from the 22% increase — or $58 a year — the city originally proposed, which residents opposed during the November 20 public hearing.

“The 22.5% increase is craziness,” Councilmember Jim Smith said. “If the economy does go a bit sour, all I’ve been hearing from some people is that, ‘Well, how is the city going to be able to handle that?’ But I think what they really should be saying is, ‘How are the people going to be handling that when they are not having as much money to pay for their bills?’ And, quite candidly, there’s a little bit of hypocrisy with some things that have been said, in that, we’re always hearing about how we need to be taking care of those less fortunate, etcetera, yet you’re going to tax the heck out of them.”

Smith put forth a motion to keep the property tax at the same rate, but after some discussion among the council, amended the motion to limit the property tax levy increase to 5% upon Councilman Goerge Hurst’s evaluation.

“Since we held the property tax for two years, I really have a problem jumping it another million dollars,” said Hurst. “But if I look at the Consumer Price Index for our area…that CPI was 4.6 percent, then it jumped in August to 5.4 percent, then it went down in October to 4.8 percent. I propose, I would be comfortable with a five percent property tax increase.”

Councilman Hurst shared that the council needs to take a “hard look at our expenditures and see if we can start getting some control” after sharing that the mayor’s proposed 2025-2026 biennium budget has $2.5 million property tax increases and another $2 million in the subsequent biennium budget.

Smith’s amendment to change the property tax levy percentage passed in a 5-2 vote, with Council President Shannon Sessions and Councilmember Joshua Binda opposed. After the motion passed and the 5% increase was essentially locked in, the levy was passed unanimously. Sessions and Binda were in favor of increasing the property tax, but likely wanted the full amount 22% put forth in the financial forecast.

“It’s either we do 5% or we don’t do anything, correct?” Sessions asked prior to the final vote on the levy.

Earlier, it was clarified that the council would have to introduce motions until a levy amount is agreed upon.

“I just hope we can look pass the percentage for a second and actually look at the dollar amount is $58 per year to help our budget be what it needs to be to move the city forward,” Councilman Binda said smiling. “If anyone is $58 away from the poverty line…I think that is a bigger problem for the city and what we are doing for our community than it is for our property tax… $58…I think we need to be smart about this…that is not a high dollar amount.”

After the vote on the property levy, the council debated utilizing an external auditing service to find areas in the budget to trim. The discussion was tabled in a 5-1-1 vote, with Binda abstaining. Council Vice President Julieta Altamirano-Crosby voted against it, arguing that the use of an external audit should be decided and voted on by the new, upcoming council next year.

“I am from the corporate world and where there is doubt you do the best thing,” Councilwoman Shirley Sutton said. “I am going to suggest that we have an outside auditor come in and talk to us and tell us what we need to do so we can get back on track… The community needs to know where their money is going and where it will continue to go.”

The discussion on the need for an audit was similar to comments made during the public hearing held for the mid-biennial budget amendment, as cutting costs was mentioned by several residents. The mayor’s office did not propose any opportunities for budget cuts during the meeting.

The mid-biennial review of the budget is required by state law, as Lynnwood adopts a two-year budget, and allows the city to modify the budget for unforeseen “significant items.”

There were three major items where the city needed to allocate additional funding.

The first was $1.5 million for contract jail housing. As construction of the Community Justice Center (CJC) is delayed, the city has continued to contract “with other jurisdictions to house the City of Lynnwood’s population.”

The second was $1 million for the city’s liability and property insurance due to an unexpected increase in the premium by the provider.

The third was a $425,500 “retro payment for prior years, actual costs for 2023 and an updated estimate for 2024” for the new contract for continued fire marshal services from South County Fire.

These costs were offset by the $3 million surplus in unexpected sales tax revenue — something mentioned several times during debate over the property tax levy.

The council also approved an ordinance to allow the zoning change needed for the Housing Authority of Snohomish County (HASCO) redevelopment of the Timberglen and Pinewood apartments on 5710 and 5714 200th Street SW. The change allows for HASCO to build a new complex with more units. This passed 6-1 with Smith voting no.

“This is just the tip of the iceberg and if it was just this property that was being changed, I wouldn’t have too much problem with it,” Smith said. “But this is going to be causing others to do the same.” 

Smith, along with Councilmember Patrick Decker, stated concerns with the over-densification of Lynnwood and the problems that could entail. However, unlike Smith, Decker voted in favor of the zoning change.

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