On Friday afternoon October 11 at 4:15 p.m., the Mukilteo City Council received the City’s first biennial preliminary budget from Mayor Joe Marine for the years 2025-2026. In the run up to this preliminary budget, there was vigorous debate concerning waiving our deficit spending policy, known as the Gap policy, for this budget, with the mayor promising in our August 19 regular meeting: “Trust me. I’m not using all the ending fund balance. I wouldn’t do that, even if you gave me the authority. I am way more conservative than that.”
This August 19 vote to waive the Gap policy was the summation of several months of hints, nudges and pressure from Mayor Marine to have the Council to remove the “Gap” spending constraint of a 3% deficit in any one year. Council President Harris motioned to waive the policy. Council Vice President Jordal seconded the motion. The motion passed, against my wishes.
Proper roles of government
For months, I have steadfastly warned the Council not to pass this dangerous motion. I have been steadily ridiculed for either my supposed inexperience or my unwillingness to be a team player with the administration. I won’t use this space to defend my substantive experience, though I will use it to remind Mayor Marine that the role of the legislative branch is to be a co-equal check and balance on the executive, not its teammate or rubber stamp on bad ideas. Thoughtful dissent and rigorous oversight is a good thing.
On issue after issue, I have been proven right. I raised the Gap issue. City confirmed it. Then on October 3 they asserted that transfers are not to be included in the expenditures used to calculate the deficit, so voila – no deficit here. No Gap closing plan, Councilmember Dixon. Ironically, the new Financial Software calculates Gap my way, so the Budget actually agrees with my calculation method for 2025-2026, while Mayor Marine lies and tells us we are not in Gap for 2024. Done correctly, we should be implementing immediate deficit reduction strategies as we are at least $300,000 over the current Gap limit.
EFB and why important
Ending Fund Balance (EFB) is the money left over at the end of the year. We need a certain amount on hand for emergencies. Our EFB balances grew from 2019 to 2024, so I analyzed the issue and determined that it was simply due to the underspending of prior budgets because of the inability to hire staff. Once hired, however, that one time saving would be gone. Presented with this analysis, in September Administrator Powers confirmed that we are now at or near full employment in the city, so the EFB grew simply due to a nonrecurring phenomenon – one time, historic understaffing for budgeted positions.
Spendthrift Joe
With no consideration for what gave rise to it, our $6 million ending fund balance was burning a hole in the mayor’s pocket and he couldn’t wait to spend it. And spend it he did. While claiming to be a fiscal conservative, like the proverbial drunken sailor, his budget takes the ending fund balance down to $2.5 million by 2026! Yes, that is a level so dangerously low, it is equivalent to 1.5 months of operating expenditures, versus the 2 months required by budget policy and the near 4 months we are currently at with our current reserve level.
With deficits as far as the eye can see, the mayor’s budget is a shameless dereliction of duty: 4.5% in 2024, 3.4% in 2025 (with ARPA, without ARPA 12.5%) and 13% in 2026! Worse, this follows transferring $1.9 million of one time ARPA funds to fund Emergency Management Services, or EMS. Without the one-time ARPA monies from the Federal Government, his budget would have taken the ending fund balance down to $600,000, from $5.8 million today.
This reckless budget would then hand off a structural deficit of $2 million per year, with only 1 month of reserves in operations.
Good luck in 2027 – huge deficit, no money and no plan.
This is why he spent so long promising not to abuse the ending fund balance, only to do exactly that! Rather than make a single cut, he grows actual expenditures by $3.6 million, from $16.9 million in 2023 to a proposed $20.5 million in 2026, while actual revenues only grow $0.6 million, from $17.2 million to a proposed $17.8 million for the same time period.
What can be done?
We clearly need to reduce spending significantly – immediately! We can no longer afford the mayor’s broken promises, outright mendacity and dereliction of duty.
Give us a budget that is a credible plan, Mr. Mayor. Keep your promise not to raid the ending fund balance.
If you can’t do your job, why do we need you? If Council has to balance your budget for you, what value do you add?
We need a competent leader, not one who is sadly and obviously well beyond his depth.
Very respectfully,
Mike Dixon, Mukilteo Councilman
Mike Dixon was elected to a four-year term in 2023. Born and raised in the U.S. Virgin Islands, he has made Mukilteo his home since 2007. Mike is currently a cleantech executive with GM Energy, owns and operates an insurance agency in Old Town, and is a solar farm investor in the Caribbean. Mike is also a three-time elected water sewer commissioner, former president of the Board of the Alderwood Water & Wastewater District, and current commissioner of the Mukilteo Water & Wastewater District. He holds a bachelor’s degree in management science and an MBA, both from MIT.
According to his bio, his council goals are building a cleantech cluster in Mukilteo, developing the waterfront as a commercial and recreational economic hub in the region, marketing Mukilteo as a welcoming and inclusive city, building policy to support the middle class and ensure our city’s sustainability, working collaboratively to ensure strong and robust long term financial planning and annual budgets, and partnering regionally to help Mukilteo remain an inclusive, sustainable, vibrant and growing city.
COMMENTARY DISCLAIMER: The views and comments expressed are those of the writer and not necessarily those of the Lynnwood Times nor any of its affiliate.
