A high-flying revenue source to help out SeaTac budget woes

By Eric Mathison

In SeaTac where property values have plunged 3 percent the past year and lawmakers are taking $15 million out of reserves to balance the biennial budget, a local attorney thinks she knows of a great new revenue-producing market for the city.

The market is “intoxicant travelers,” according to Stefani Quane.

Quane noted at the Nov. 13 City Council meeting that with the passage of Initiative 502, recreational marijuana is legal in this state.

She predicted people will fly into Sea-Tac Airport searching for pot stores.

“SeaTac will be the new Las Vegas,” Quane declared. “The council needs to think about it.”

More immediately, Quane urged lawmakers to consider what areas it wants to zone for collective gardens to serve medical marijuana patients.

The council previously passed and then twice extended a moratorium on permits for medical marijuana dispensaries. Lawmakers said they wanted to wait until discrepancies between state law and federal law, which outlaws even medical marijuana, are worked out. They also wanted to wait to see how I-502 fared at the polls.

Staffers were also directed to analyze marijuana dispensary zoning in other cities and research state law and legal cases.

Quane said with the new state law that takes effect Dec. 6, identifying appropriate areas within the city for pot stores is even timelier. She noted the state liquor control board will oversee locations where marijuana is sold.

“The liquor control board should know where you want them,” Quane told council members.

On a more sober subject, council members approved the 2013-2014 biennial budget.

In all funds, the city will spend $122.7 million with expected revenues of $107 million. Reserves in all funds will dip from a beginning balance of $50.9 million to $35.3 million.

In the general operating fund, the city will spend $63.9 million on projected revenue of $63.1 million. General budget reserves will dip from $9.1 million to 8.3 million.

Councilmember Dave Bush noted the economy is in a downturn with home prices and construction activity way down, making it necessary to use reserves to balance the budget.

“We will dig our way out of this,” Bush said.
But Councilmember Rick Forschler said in budget workshops he had pressed for a balanced budget without using reserves.

He noted that in 2010, the city had $64 million in reserves. By the end of 2014, the reserves will be $35 million.

“We need to have a system where we balance the budget (without using reserves),” Forschler declared. “I will vote no. That shouldn’t be a surprise.”

Pressed by Deputy Mayor Mia Gregerson for suggestions on how to balance expenditures and revenues, Forschler said a newly instituted Process Improvement Plan will save more than enough in the future to make up the difference.

In the short-term, council members should have made clear to staff early in the process, that they wanted the staff to balance revenues and expenditures in a proposed budget, Forschler said.

Mayor Tony Anderson said Forschler had not identified specific cuts while going through departmental “decision cards” during budget workshops.

Anderson added, “We have one of the most fiscally sound cities in the state.”

Finance director Aaron Antin said cities usually hold about 7 to 10 percent of their budget in reserves. SeaTac has 25 percent.

Lawmakers also voted to raise the city’s property tax rate to $3.05 per $1,000 of assessed property value.

Mayor Anderson, Deputy Mayor Gregerson, Councilmember Barry Ladenburg and Bush voted for the tax rate. Forschler and Councilmember Terry Anderson voted against. Councilmember Pam Fernald was excused from the meeting.

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