REDMOND — A $125.4 million Redmond city budget that will pay for major airport work, street upgrades and 15 new employees, including two new police officers, was passed unanimously by the Redmond City Council at its Tuesday night meeting.
This represents an increase of more than $16 million compared to the 2018-19 budget, but is far smaller than the $30 million increase approved last year, according to city documents.
A reason for the increased spending comes from $44.6 million in capital projects, particularly in regards to Redmond Airport, which the city operates.
This spring, a revenue bond provided the city with $20 million for three major airport projects. The city has 20 years to repay the bond using airport revenue.
The first project is a $12.7 million, 42,000-square-foot building for existing snow removal equipment. The building, which is expected to be finished in late 2020 or early 2021, will replace an existing building that serves the same purpose, yet is six times smaller, meaning much equipment is stored outside, according to city documents.
The second project, a $3 million expansion of the airport’s parking lot, will add 300 stalls by the fall. The third project is a $7 million rental car facility near the Deschutes County fairgrounds.
The city budgeted $3.1 million in the 2019-20 fiscal year for a new, $12.1 million water facility serving south Redmond, which has experienced rapid growth. Design for an expanded wastewater facility will cost the city $2.4 million this year. Both of these products will be partially paid for by proposed development fee increases, which the City Council will vote on later this month.
There are also multiple street corridor improvements in the city budget. The two most expensive projects will renovate busy residential streets NW Hemlock Avenue and SW 15th Street, neither of which has sidewalks or bike lanes. The two streets will receive $2.5 million in upgrades.
Construction on 15th Street between Highland and Obsidian avenues has already started and will include adding sidewalks on both sides of the road, as well as resurfacing the pavement, according to City Engineer Mike Caccavano. He said Hemlock Avenue will get bike lanes and sidewalks on both sides, along with a pavement overlay, between NW 19th Street and NW 35th Street. Four blocks on Hemlock will receive bike lanes and sidewalks from developers, as housing developments are going in between 23rd and 27th streets. Construction will likely start on Hemlock in the early spring of 2020, Caccavano said.
Another large budget expense is personnel costs. Redmond will spend about $25.6 million in wages and benefits for its employees in the 2019-20 fiscal year — an increase of 14% from last year.
There are a few reasons for this: The city plans on hiring 15 new workers, two of them part time. Two of the full-time positions will be police officers, with one assigned to the airport. Unionized Redmond police officers — who are all officers not in ranking positions — will receive a 1.5% raise, and nonunionized city staff will have a 2% salary increase. Unionized city employees, most airport and public works staff, are currently in wage negotiations with Redmond, but the city expects they will also receive a 2% raise.
Finally, employee benefit costs have risen. Medical premium costs for city employees are going to be 25% higher than last year, costing the city about $4.9 million, and employee contributions to the Public Employees Retirement System are going up 34% to $3.7 million.
In order to fund these projects and rising wages and benefits, the city is expecting a 5.8% increase, or $527,000 more in property tax revenues from last year. This is because of increasing property values — the city is not raising property taxes. Parking revenue at the airport is also expected to rise by more than $1.2 million due to higher rates approved in December, as well as more people using the airport.
The city is planning to spend about $31.4 million in 2019-20 than it will earn, but Jason Neff, Redmond’s chief financial officer, says city staff aren’t concerned about this because the spending amount is inflated by the already-approved $20 million bond for airport improvements. Redmond is expecting to have $45.6 million left over in reserve funds — about $1 million less than last year.
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