2013 Annual Budget - City of Bremerton

save money. This year, the City refunded its general obligation bonds associated with the
Norm Dick’s Government Center. This refunding (refinancing) will save the City
approximately $1,690,000 over the remaining life of the bond. (The City did not extend the
remaining life of the bond, keeping the original 2034 maturity date.) This resulted in a direct
savings to the 2013 general fund of over $135,000.
During 2011, the City created two new funds, an Accumulated Leave Fund and Employment
Security Fund, to address short term and long term liabilities associated with personnel. The
City is self insured for unemployment benefits but has not in the past funded this liability.
Also, the City has an obligation to cash out accumulated leave banks for those employees that
leave City service. With the creation of these funds, the City is moving toward increasing
fiscal stability by incorporating these costs into our annually budgeted personnel expenditures
and having them centralized in a dedicated fund to minimize the impact to the operational
budgets for each department. The 2013 budget continues this initiative.
As with 2012 and in keeping with the conservative approach, capital and/or special projects
that require grant funding have only been budgeted if the grant funding has already been
awarded. Any projects that require new grants have not been identified in this budget. If the
City applies for and receives grant funding for new projects/programs during 2013, the City
will amend the budget at that time. By taking this approach, we can assure our citizens that
full discussion can occur before we expend resources for items that we may not receive.
To increase transparency regarding using on-going revenues to fund on-going expenditures,
we separated capital into individual funds for each of our utilities with the 2012 Budget and
will continue this practice with the 2013 Budget. By isolating out the capital from our ongoing
operations and maintenance (O&M) costs, we can better identify our O&M costs to
better analyze our revenue needs. In addition, the City is currently undergoing a
comprehensive rate analysis of all three utilities. We are working with a Citizen Advisory
Committee during this process and will be providing many opportunities for public input
before any final decisions are made.
As mentioned in the prior bullet, the City is currently undergoing a comprehensive rate
analysis for its three utilities (Water, Wastewater, and Stormwater). Until this study is
complete, there are no utility rate increases in the 2013 Budget. This study includes an
analysis of how we do business (our costs) as well as our revenue needs to adequately fund not
only our operations and maintenance, but also our future capital and system replacement
needs. In preparation of and concurrent with the rate study, the Public Works Utility
departments have done an exemplary job of analyzing and minimizing their cost of service
delivery, which has been incorporated in this budget. Once the rate study is complete, any
changes that may result from this study can be incorporated into the 2013 Budget through a
budget amendment.
This budget proposes no changes to our current PILOT or commercial parking tax rates but
does incorporate an increase to the B&O tax exemption rate to assist our small businesses.
The Council, with Administration’s cooperation, has increased the B&O tax exemption level
by $20,000, raising the level from $60,000 to $80,000 for annual gross income. In addition, it
is intended that the B&O tax exemption level increase each year by $20,000 until the B&O tax
is eliminated. The City acknowledges that at a rate of $20,000 annually for increases, the