Berrios lobs accusation at his political opponent Mayor Cooke; Kent Council wades in

Kent mayoral candidate Jim Berrios didn’t mince words at Tuesday’s City Council meeting, accusing the administration of his incumbent competitor Suzette Cooke with poor financial management.

Kent mayoral candidate Jim Berrios didn’t mince words at Tuesday’s City Council meeting, accusing the administration of his incumbent competitor Suzette Cooke with poor financial management.

Speaking during a public hearing geared toward what residents wanted to see in next year’s budget, Berrios told the Council that he wants to know whether the administration’s budget forecasts are a result of “fiscal mismanagement or deception.”

Berrios was one of nine residents to speak on the city’s 2010 financial picture Tuesday at City Hall. There isn’t an actual 2010 budget yet.

“I ask the City Council these simple questions of what is happening here - is it fiscal mismanagement or deception?” said Berrios, who said Cooke’s sales-tax revenue projections for the rest of 2009 are too high. “I have to ask these questions because I’m very concerned about who is responsible for overseeing the budget and holding the current administration responsible.”

Cooke, in a phone interview Thursday, denied the accusations by Berrios, her opponent on the Nov. 3 ballot.

“That’s campaign rhetoric,” Cooke said. “There is absolutely no fiscal mismanagement or deception with our budget. “We have been very open reporting our financial picture with our projections and actual numbers. I think it was inappropriate of him to say it was deceptive.”

At Tuesday’s meeting, Berrios handed out city budget monthly analysis reports from the last six months to the Council. The documents show the city expects to receive $8.7 million in sales-tax revenue for the last four months of 2009, compared to the $9.2 million in sales-tax revenue it has received through the first eight months of the year.

“The numbers are not coming in,” Berrios said. “But they project an 89.6 percent increase in sales tax revenue over the next four months (compared to the first eight months).”

City Finance Director Bob Nachlinger, who compiles the monthly budget reports, predicts the city will hit the $8.7 million mark in sales-tax revenue for the rest of the year, for an annual total of $17.9 million.

On Wednesday, he held fast to that projection.

“I expect the economy to pick up and the revenue to be there,” Nachlinger said in a phone interview Wednesday. “That’s my story and I’m sticking to it.”

Cooke backed up Nachlinger.

“I’m confident in Bob Nachlinger with his 35 years of experience that he has reliable predictions,” Cooke said. “His projections that by the end of the year sales taxes will start picking up are very accurate.”

City Councilman Tim Clark said near the end of the Council meeting - during his report as chairman of the Operations Committee - that he also has concerns about the “rosy picture” he said the city administration continues to paint in terms of sales tax revenue.

“I am not comfortable with this,” Clark said.

Clark has stated publicly several times since an October 2008 budget workshop on the 2009 budget that he expects sales-tax revenue to drop from what city staff predicts.

Clark also said at Tuesday’s meeting that he spoke for the entire Council as far as his criticism of the mayor and her staff’s approach to the budget when he said, “We are not pleased.”

Other Council members comment

Councilwoman Deborah Ranniger and Counciwoman Jamie Danielson each said in phone interviews Thursday that Clark wasn’t, in fact, speaking for the Council.

“Tim was not speaking for me,” Ranniger said. “He was speaking for himself.”

Ranniger disagreed that the mayor and her staff painted a rosy picture for the 2010 budget.

“I don’t think anyone looks at next year as rosy,” Ranniger said. “We’re on the verge of making signficiant (budget) cuts.”

Councilman Les Thomas, Councilman Ron Harmon and Councilwoman Elizabeth Albertson said they did not know Clark would make a statement about the budget at the meeting, but agreed with what he said about the budget reports.

“The Council has been very frustrated with the documents we are given and the way the information is presented,” Albertson said. “We ask for things a certain way, but we don’t necessarily get it. The Council has discussed with staff to be less optimistic with their revenue projections, but they keep reporting overly optimistic numbers.”

Council President Debbie Raplee heard Clark make a similar statement at the Operations Committee meeting Tuesday prior to the full Council meeting. Clark, Raplee and Thomas serve on the Operations Committee that deals each month with the city budget reports.

“I don’t think it will be as rosy a picture as proposed,” Raplee said of the city staff forecast. “I think it will be worse, but I don’t know to what degree.”

Raplee said she knows the Council has doubts about whether the administration’s revenue predictions will come true.

“The majority of the Council is concerned to varying degrees,” Raplee said. “We don’t know if we will hit the numbers or by how much we will miss.”

Clark said in a phone interview Thursday that the Council had asked Cooke and her staff at a September workshop to start to revise downward the sales-tax revenue forecasts in the monthly budget reports because the city continued to fall behind in its budget due to the lower revenue. Clark explained what happened at the Operations Committee meeting.

“When I picked up the budget report at the October meeting it was the same old story that we’re OK and we will finish with a budget surplus,” Clark said. “That’s why I jumped on the mayor. I told her we can’t go with this data and they did it again.”

Clark said he wants Nachlinger to use more economic data based on what might happen in Kent rather than national forecasts, which he claims Nachlinger uses.

“He uses a national index and when you apply that to the city of Kent, the data is not good,” Clark said. “He is being selective in his data. We would have to double all sales (over the rest of the year) to meet the projection they show and that is not going to happen.”

Wanting better projections

While stating they want Cooke and her staff to provide better budget projections, Council members said they do not believe Cooke has mismanaged the budget or been deceptive.

“If you step back and look at it from 30,000 feet, it’s a mayor’s race,” Ranniger said, of the comments Tuesday. “There is a lot of finger-pointing going on.”

Raplee also said there has not been mismanagement or deception by Cooke’s administration. Raplee expects to know a lot more about the city’s financial picture when Cooke presents her 2010 preliminary budget to the City Council 4 p.m. Oct. 22 at City Hall.

“Layoffs are coming, we just don’t know to what extent,” Raplee said. “I think staff has done as well it could, such as not hiring anyone to fill open positions. It could be they were up against a wall. When she presents her budget, we will know more. We can only speculate now.”

Cooke plans to propose more than $3.1 million in job and service cuts when she presents her budget.

Cooke said at a Sept. 1 Council workshop the cuts would be $3.1 million and might have to be even deeper once more revenue numbers are reported.

“I do not have a solid number at this time other than it will be greater than $3.1 million,” Cooke said in a Thursday interview. “We will give out that figure when we present the budget to the Council. I do not want the number to go to the public before the Council sees it.”

The Council will have a public hearing on the proposed budget later this fall, before they vote on the final 2010 budget in December.

City staff is projecting a revenue shortfall of at least $2.1 million next year because of what Cooke called a “flat recovery” in the economy in 2010. Cooke also wants to set aside $1 million in the budget for a flood emergency fund in case the city gets struck by flooding of the Green River this winter because of storage capacity problems at the Howard Hanson Dam.

Kent resident Denton Hanford told the Council he studied the monthly budget reports. Hanford predicts the city’s general fund balance to be $5.45 million in the hole by the end of the year because of low sales tax revenues. City staff projects a positive general fund balance of $6.9 million.

“When you take that low revenue and expenditures greater than the budget, you get that $5.45 million,” Hanford said Tuesday. “That’s a significant problem, one that I’m afraid has not been faced up to. I encourage you to do that now.”

Nachlinger said he predicts the fund balance will hit $6.9 million because of a $13 million property tax payment the city will receive this month from King County, and which is not yet reflected in the year-to-date budget, as well as increased sales tax revenue.

“The purpose of the hearing was not for political statements but for what you would like to see or not see in the budget,” Nachlinger said of the comments by Berrios and Hanford. “Other people requested what they would like to see in the budget. I’m happy with that.”

Other budget comments

At Tuesday’s meeting Dave Mortenson asked the Council to continue financial support for the Kent Sister Cities. He serves as volunteer president of the program. Linda Wagner, curator of the Kent Historical Museum, asked that the Council again includes funds for the museum in an effort to attract more people to the facility. Joe Rubio told the Council it should take money from the city arts commission and put it in the general fund.




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