The city of Tacoma is again dealing with a budget deficit. This is nothing new to Teresa Green, assistant finance director and budget officer for Tacoma.
“I've been with the city for almost two decades. Every budget that I've been a part of has had a structural gap in the general fund, so it's not a new problem,” Green said.
There’s a projected $40 million deficit in the 2027-2028 biennial budget that will need to be solved before the city can adopt a balanced budget, which is required by law.
In a June presentation to the city council, the deficit was attributed to numerous factors that other cities are also facing.
The rising population is increasing demand for services, and the city’s expenditures are growing at nearly twice the rate of its revenue. That’s partially due to higher costs for things like employee healthcare costs and wages.
In the past, Green said, the city has balanced its budget with one-time funds from sources like grants. But Tacoma’s new city manager Hyun Kim has proposed a plan to address the long-term structural deficit by making cuts to programs and city services.
One way the city is seeking feedback on where it should make cuts is through an online budget simulation tool called Balancing Act.
“ We want you to understand the decisions that we have to make to try and solve that gap,” Green said.
Users can submit their suggested budget cuts and any comments on revenue and expenses to the city.
The city can see the aggregate results from this. When the tool has been used in the past, the feedback has been shared with the city council.
Green said it’s a way for the city council to understand what residents’ priorities are for city dollars.
Two expense categories can't be modified — debt and pensions — because the city is obligated to those amounts.
This year, the city put a new restriction on it — users can’t decrease or increase a budget line by more than 20%. Green said that restriction reflects the reality of budget choices.
“You can't cut one department. You can't cut one whole service area. We're really going to have to look at lots of different options in order to find that $40 million for this biennium,” Green said.
When trying to reduce the deficit using the tool, there are no options to increase revenue.
The tool costs the city $12,500, according to a city spokesperson.
The Tacoma City Council will see a first budget proposal on Oct. 6. The city council is set to adopt the budget by mid-November.
Read the audio transcript here.
