With a preliminary two-year budget of $1.513 billion for the city of Bellevue, a few changes impacting residents are on the horizon.
On Monday, city staff revealed the balanced 2017-2018 preliminary budget to the City Council in a study session, along with an economic forecast that foresees an economic slowdown in the next few years.
But most pressing for residents is a proposed 4 percent increase of utility (storm, sewer and water) rates in the coming two years.
Of the proposed budget, $1.035 billion will go to the operating budget and will be used for city services like police, fire, parks, transportation, utilities and city staff.
At the meeting, staff also announced the 2017-2023 General Capital Improvement Plan, with $485 million to be spent on special projects over the next two years, including beginning work on Meydenbauer Bay Park, siting, design and construction of Fire Station 10, an entry designed for the newly-improved Downtown Park, the initial “Grand Connection” implementation and the Eastside Rail Corridor.
Another $221 million for Utilities Capital Investment was planned for infrastructure. Much of Bellevue’s utilities infrastructure is aging, and that need will have to be addressed in the next half-century. The Utilities Department manages more than $3.5 billion of infrastructure assets.
Some of the cost for that department will come from the city’s Advanced Metering Infrastructure project, which will begin migrating manually-read water meters to meters that can send radio or cellular signals to monitor water levels. The city has already budgeted for this project, the department said, and the rate hike is not a result of the project.
In a June story, the Reporter reported that an eventual rise in utilities rates was likely.
The average Bellevue household pays $58.42 in water utility bills every month, according to city data. This is $1.32 over Kirkland, $4.01 over Mercer Island and a whopping $21.42 more per month than the average Redmond resident.
The numbers are more forgiving when it comes to multi-family and commercial properties, but Bellevue is not far from the top in any of the water categories.
Bellevue is ramping up water main replacement, hoping to replace five miles of small-diameter main replacement every year by 2018 (Bellevue has more than 600 miles of water mains, making this a 125-year project, Utilities Director Nav Otal said in June).
The last major issue that drives up water rates is the fact that unlike Issaquah or Redmond, Bellevue has no independent water supply.
Bellevue does make up ground when the three Bellevue utilities (water, storm, sewer) are averaged out. In those numbers, the average Bellevue resident pays $156.74 monthly, below Kirkland and Mercer Island, well below Seattle and well above Redmond, according to city data.
The city does forecast continued economic growth, but a tapering off on sales tax growth is likely as Downtown construction projects finish and those construction workers leave the city. According to city economists, the Great Recession ended seven years ago, and past data indicates the nation is likely due for a slowdown by 2018 or shortly thereafter.
Bellevue (and Puget Sound at large) has recovered after the recession. Median home values are now 23 percent higher than they were at the pre-recession peak in late 2007 and 48 percent higher than the low point in late 2011. The mean home value in Bellevue, according to real estate site Zillow, is now more than $717,000.
Bellevue operates under a budget model called “Budget One,” which looks at outcomes rather than departments. That means money goes to “services that deliver outcomes important to the community.”
One of these priorities included council approving funds several weeks ago to apply for a $100 million Transportation Infrastructure Finance and Innovation Act (TIFIA) loan to help with major improvements necessary in the BelRed corridor for water main and infrastructure replacements.