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City of Mercer Island
2011-2012
Biennial Budget
Reader’s Guide
Section Overview
The budget document serves two distinct purposes: 1) to present the City Council and public with a
clear picture of the services which the City provides, the cost of those services, and the policy decisions
underlying the financial decisions; and 2) to provide City management with a financial and operating plan
that conforms to the City's financial system. The sections below describe the various budget segments,
therefore providing a map for readers to locate information they are most interested in seeing. The
sections are listed in the order in which they are found in the budget. Following the Section Overview
is a brief description of fund accounting, the types of funds included in the budget, the basis of
accounting used, and the budget process.
B. Budget Message
The Budget Message provides an overview of the key policy issues facing the City as well as the City
Manager’s recommended operating and capital plan for the coming two years.
C. Budget Policies
The Budget Policies were developed to provide a clear foundation for a variety of funding and
management decisions. During the development of the biennial budget, the policies are formally
reviewed with Council to obtain approval, to ensure their relevance, and to determine what new
policies might need to be written. Some of the strictly financial policies change very little from year to
year, while some of the program-related policies are revised every two years to provide the most
current information.
D. Budget Summary
This section explains how the City is organized and staffed; includes citywide, summary level revenue
and expenditure information; provides an annual and biennial financial summary by fund; identifies the
types of property tax collected and where the monies go (i.e. by government jurisdiction); provides an
overview of utility (i.e. water, sewer, and storm water) rates; highlights the purpose and status of debt
issued by the City; identifies the change in and composition of the ending balance for each fund; and
identifies the City’s key performance measures (called “dashboard” indicators), which are organized
around the City’s six Priorities of Government.
E. General Fund Summary
The General Fund is the general operating fund of the City and encompasses the major services
provided by the City, excluding utilities: police; fire; parks and recreation; street and right of way
maintenance; development services; legal, judicial, and financial services; and general administration. This
section is divided into two sub-sections. The revenue sub-section includes a description and an
historical comparison of each major revenue source in the General Fund. The expenditure sub-section
includes a budget analysis comparing the 2010 Approved Budget to the 2011-2012 Final Budget (broken
down by year) as well as a description and an historical comparison of each major expenditure category
in the General Fund.
F. Utility Funds Summary
This section provides background information on the City’s three utility funds (i.e. Water Utility, Sewer
Utility, and Storm Water Utility), which are operated separately as “enterprises” in which the charges
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City of Mercer Island 2011-2012 Budget A-1
Reader’s Guide
for service (i.e. utility rates) are set to cover the full cost (both operating and capital) of conducting
business. In addition, the proposed rate increases for each utility are described and income statements
for each utility are provided for a four year time period (2009-2012).
G. Operating Budget by Department
This section breaks down all of the City’s operations by department: City Attorney’s Office, City
Council, City Manager’s Office, Development Services Group, Finance, Fire, Human Resources,
Maintenance, Municipal Court, Parks & Recreation, Police, Youth & Family Services, and Non-
Departmental. Each department sub-section is organized as follows:
Department Summary: Includes description, organization chart by function, staffing
summary, resources and uses summary, expenditure summary by function, and budget analysis
by fund or fund groups.
Department Functions: Each department is further broken down into “functions,” which
represent major services provided by the department. For each department function, the
following is identified: description, priority of government, services & products, 2011-2012 key
initiatives, and expenditure summary by category. It should be noted that the City’s Capital
Improvement Program (CIP) is not included in this section, but rather is presented separately in
Section H.
H. Capital Improvement Program
This section identifies all of the capital improvement projects planned for the following six years (2011-
2016), tying together the capital projects developed from the City's state mandated six-year plans, such
as the Transportation Improvement Plan (TIP). More specifically, information on the development and
financing of the six-year CIP is provided; the real estate excise tax (REET) forecast is included; significant
projects are highlighted and unfunded capital needs are identified; a project summary, broken down by
project category, and individual project sheets are included; and six-year fund statements are provided
for the Street, Capital Improvement, Technology & Equipment, Water Utility, Sewer Utility, and Storm
Water Utility Funds.
I. Recap by Fund
The City accounts for all of its operating and capital activities within a number of “funds,” each of which
is considered a separate accounting entity with a distinct set of self-balancing accounts. This section
includes all of the City’s funds, providing a brief description of and identifying the resources and uses
associated with each fund. Also, summary level information is provided for all City funds at the end of
this section.
J. Appendix
This section includes three sub-sections: 1) City Highlights, 2) Glossary of Terms, and 3) Staffing
Classifications. The City Highlights sub-section includes a description of the community; demographic
information about Mercer Island’s residents; statistical information about City services and assets;
listings of major employers and major taxpayers; historical development activity levels (in terms of
building permits issued and total valuations); and historical assessed valuation, levy rates, and property
tax levy amounts. The Glossary sub-section includes a listing of budgeting and accounting terms used in
the budget document. Finally, the Staffing Classifications sub-section identifies all job classifications
within each bargaining unit as well as the 2010 salary ranges for each position.
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A-2 City of Mercer Island 2011-2012 Budget
Reader’s Guide
K. Service Requests & Reductions
A “service request” represents a new (or renewed) request for a temporary or ongoing position,
contracted services, and/or equipment costing at least $10,000. A “service reduction” represents a
temporary or ongoing proposal to reduce or eliminate one of the following: 1) a service, program, or
event provided/organized by City staff; 2) a contracted service; or 3) subsidized funding of a service,
program, or event by the General Fund. A Summary Listing by Department is provided along with a
Funding Summary. Individual service requests and reductions are also included and are organized by
department.
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City of Mercer Island 2011-2012 Budget A-3
Reader’s Guide
Explanation of Accounting Basis and Budgeting
Basis of Presentation - Fund Accounting
All City activities are organized on the basis of funds, each of which is considered a separate accounting
entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that
comprise its assets, liabilities, fund equity, revenues, and expenditures (or expenses, as appropriate).
The City has 20 separate funds, each of which is described in detail in Section I – Recap by Fund.
Government resources are allocated to and accounted for in individual funds based upon the purposes
for which they are to be spent. Each fund serves as an expenditure control mechanism. The various
funds are grouped into eight categories as follows:
General Purpose Funds
Revenue in this fund category is considered unrestricted and can be used for any City purpose,
including operations and capital. This category consists of three funds: the General Fund, the
Self-Insurance Fund, and the Youth Services Endowment Fund. The General Fund is
the general operating fund of the City and is used to account for all activities not otherwise
required to be accounted for in other funds. The major services accounted for in the General
Fund encompass police; fire; parks and recreation; street and right of way
maintenance; development services; legal, judicial, and financial services; and
general administration. The Self-Insurance Fund is a “reserve” fund that pays for insurance
losses not covered by the City’s $5,000 deductible or other insurance. The Youth Services
Endowment Fund is a “permanent” fund in which the donated monies remain invested as
principal and from which the earnings on the principal can be spent to support ongoing Youth &
Family Services’ programs, which are accounted for in the Youth & Family Services Fund.
Special Revenue Funds
Special revenue funds group together any activities that are financed by restricted revenue
sources (as opposed to general purpose revenues) but which are not required to be designated
as enterprise activities. Funds included in this category are the Street Fund, Criminal
Justice Fund, Beautification Fund, Youth & Family Services Fund, Municipal Arts
Fund, and the Contingency Fund. The Contingency Fund is a reserve fund that is available
to temporarily stabilize significant revenue shortages or to address unanticipated needs. Council
policy has set the Contingency Fund at 10% of budgeted General Fund expenditures.
Enterprise Funds
Enterprise funds are used to account for activities that are financed and operated in a manner
similar to private business enterprises. In enterprise funds, the intent of the governing body is
to recover costs (i.e. expenses, including depreciation) of providing goods or services to the
general public on a continuing basis primarily through user charges. Funds included in this
category are the Water Fund, Sewer Fund and Storm Water Fund.
Internal Service Funds
Internal service funds are used to account for the financing of goods or services provided by one
department to other departments of the City on a cost reimbursement basis. This fund
category includes the Equipment Rental Fund and the Computer Equipment Fund. The
Equipment Rental Fund accounts for the cost of maintaining and replacing all City vehicles, heavy
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A-4 City of Mercer Island 2011-2012 Budget
Reader’s Guide
equipment, and 800MHz radios. Each department is charged operating and maintenance rates as
well as replacement rates for the use of these assets. The Computer Equipment Fund was
created to protect the City’s current and future investment in computer equipment. Each
department is charged a rate that covers the cost of repair and maintenance, replacement, and
operation of the City’s wide area network. The rate is based on the number of computers
actually owned by each department.
Trust and Agency Funds
These funds account for activities where the City acts as the fiscal agent. There is only one fund
in this category—the Firemen's Pension Fund.
Debt Service Funds
Debt service funds are used to account for the accumulation of resources for the payment of
general long-term debt principal and interest. The City of Mercer Island has two debt service
funds: the Bond Redemption Fund–Voted Debt and the Bond Redemption Fund–Non-
Voted Debt.
Capital Projects Funds
Capital projects funds are used to account for financial resources earmarked for the acquisition
or construction of major capital facilities (other than those financed by proprietary funds, special
assessment funds, and trust funds). These funds are not part of the operating budget, but are
included in the City's six-year Capital Improvement Program. Current capital projects funds
include the Capital Improvement Fund, the Technology and Equipment Fund, and the
Capital Reserve Fund.
Basis of Accounting
The City's basic accounting structure, including its chart of accounts and account coding format, is
mandated by the Washington State Auditor's Budgeting, Accounting and Reporting System (BARS), and
is enforced by the Office of the State Auditor through annual audits. The basis of accounting refers to
when revenues and expenditures (or expenses) are recognized in the accounts and reported in the
financial statements.
Accrual Basis of Accounting
The accrual basis of accounting is followed in all of the City’s enterprise, internal service, and
trust funds. Under this basis of accounting, revenues are recognized when earned, and expenses
are recorded when incurred. As a result, revenues can be recognized even though no cash has
been received yet, assuming that a good or service has been provided. Also, expenses can be
recognized once a good or service has been received even though no payment has been made
yet. This is the same basis of accounting that is used in the private sector. All assets and
liabilities are recorded in the fund that owns them.
Modified Accrual Basis of Accounting
All of the remaining fund categories are reported under the modified accrual basis of accounting.
Under this basis of accounting, revenues are recorded when they are both measurable and
available. "Available" means collectible within the current period or soon enough thereafter to
pay current liabilities. The major revenue sources that are accrued by the City are listed below.
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City of Mercer Island 2011-2012 Budget A-5
Reader’s Guide
Property Taxes – King County acts as the City's intermediary collection agency. The
County remits to the City on a daily basis property taxes paid by Mercer Island property
owners. Property taxes should be accrued only when due and expected to be collected
within 60 days of the end of the fiscal period. The City accrues all property tax revenue
received within 31 days of the end of the fiscal period.
Utility Taxes – Utility taxes are considered both measurable and available if collected
within 31 days of the close of the fiscal period.
Business & Occupation Taxes – Primarily collected on an annual basis, revenue is
considered measurable and available if received within 45 days of the close of the fiscal
period.
State Shared Revenues – Mainly State collected sales and excise taxes, these revenues are
considered measurable and available if received within 31 days of the close of the fiscal
period.
Grant Revenues – When expenditures are the primary factor for determining eligibility, the
grant revenue is considered measurable and available when the expenditure is made.
Interfund and Intergovernmental Services – When goods and services have been
provided, these are considered both measurable and available.
Interest and Rental – When investment interest and rental income have been earned and
are due they are considered measurable and available.
Revenue sources that are not considered to meet the measurable and available criteria include
licenses and permits, fines and forfeitures, and other miscellaneous revenues since their values
are not known until received.
Under the modified accrual basis, expenditures are recorded when the liability is incurred. An
exception to this rule is the principal and interest on general long-term debt that is recognized
as an expenditure when it is paid. Long-term liabilities are accounted for in the general long-
term debt account group. Purchases of fixed assets are expensed during the year incurred, and
are accounted for in a separate fixed asset system over their useful life.
Budgetary Basis
The budgets of general governmental type funds (for example, the General Fund and the Street
Fund) are prepared on a modified accrual basis. The enterprise funds (i.e. Water, Sewer and
Storm Water Utilities), on the other hand, are budgeted on a full accrual basis.
Budget Process
The City follows the below outlined procedures in establishing its budget every other year. These
procedures are in accordance with State law time limitations and are designed to allow the Council and
public ample opportunity to understand and have input on the budget direction of the City for the next
two years.
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A-6 City of Mercer Island 2011-2012 Budget
Reader’s Guide
Budget Process Steps Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
1. 6 year Capital Improvement Program (CIP)
kick-off meetings with Council and staff
2. Budget policies related to the CIP are
reviewed by Council at three points during
the budget process
3. Operating Budget kick-off meetings with
Council and staff
4. Budget policies related to the Operating
Budget are reviewed by Council at two
points during the budget process
5. Operating Budget revenue and expenditure
estimates prepared by departments
6. CIP Preview meeting with Council
7. Departments submit Operating Budget
requests, key initiatives, and other
information related to the coming
biennium
8. Finance department prepares tax and other
major revenue estimates
9. Finance Department and City Manager
review departmental Operating Budget
requests and make changes as necessary
10. City Manager's Preliminary Budget
prepared and filed with the City Clerk
11. City Clerk publishes notice of Preliminary
Budget and public hearings
12. City Manager and Finance Director present
Preliminary Budget to Council
13. Copies of Preliminary Budget made
available to the public
14. Public hearings on Preliminary Budget held
15. City Clerk publishes notice of public
hearing on Final Budget
16. Final hearing begins no later than the first
Monday in December
17. Council adopts balanced Final Budget for
coming biennium
The budget, as adopted, constitutes the legal authority for expenditures. The City’s budget is adopted
at the fund level so that expenditures may not legally exceed appropriations at that level of detail.
Transfers or revisions within funds are allowed; however, any revisions that alter the total expenditures
must be approved by the City Council. When the City Council determines that it is in the best interest
of the City to amend the budget appropriations, it may do so by ordinance approved by one more than
the majority at any regularly scheduled Council meeting.
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City of Mercer Island 2011-2012 Budget A-7
Reader’s Guide
The budget is formally monitored on a quarterly basis by the Finance Department, generating a quarterly
financial status report to the Council. Because the City prepares a two-year budget, a mid-biennial
budget review meeting is also held in November of the first year of the biennium. Amendments to the
adopted budget are typically approved by the Council at this meeting or when a quarterly financial status
report is presented to the Council.
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A-8 City of Mercer Island 2011-2012 Budget
Budget Message
Under Washington Law, the City Manager presents a balanced annual or biennial budget for the City’s
upcoming fiscal period for consideration and adoption by the City Council.
Mercer Island’s biennial budget serves a number of essential functions. The budget is more than a
“checkbook” posting of proposed revenues and expenditures. It is a financial plan that looks out over
two-year (operating budget) and six-year (Capital Improvement Program) horizons, balancing planned
income and expenses in a fiscally responsible manner. It is a policy plan, guiding and assuring the City’s
long-term financial health. And, most importantly, it is a detailed description of the goods and services
for which the City and its elected officials will be held accountable. It documents the “social contract”
between the citizens and their government.
The budget also serves in a broader policy context. It draws upon many City Council decisions and
discussions that precede it, and it will leave a legacy of policy influence for future budgets–helping to give
the City’s finances long-term stability and continuity.
How the Budget is Organized
The Reader’s Guide (Section A) at the beginning of the budget document provides a brief overview of
how the City’s budget is organized.
The budget covers two operating years for all City departments and functions. However, in order to
assess revenue and expenditure trends, most budget sections also show actual data for 2009 and
forecast data for 2010.
Service Packages
Reflecting the City Council’s desire to focus on significant changes in the proposed budget for the
coming biennium, City staff has prepared the following departmental “service packages” for 2011-2012:
1) Service Enhancement Requests, and 2) Service Reduction Proposals. Given the recent economic
recession and the dramatic decline in revenues over the last two years, the service packages described
in the budget are almost entirely related to service reductions.
This budgeting approach recognizes that most of the services provided by a city extend from one year
to the next, especially in a city that isn’t growing. Consequently, the scope of the budget review process
is narrowed to notable increases and decreases in each department’s operating budget. In addition, the
City Council will review the changes to each department’s “base” (i.e. ongoing) budget. These changes
are broken down into two major components: 1) general inflationary increases, and 2) other significant
changes. Within the latter component, “prior year one-time costs” are called out collectively as a
decrease, because they will not be re-budgeted in 2011-2012 within each department’s “base” budget. If
such a cost needs to be budgeted again in 2011-2012 and it is $10,000 or more, it will be proposed as a
service enhancement request.
Service package detail sheets are provided in Section K. They are summarized later in this Budget
Message.
Priorities of Government
Over the past two biennia, the City has shown how it spends its resources against the City Council’s
stated or implied priorities. The Council has sought this information so that it can better understand and
consider tradeoff decisions among and across services and cost centers.
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City of Mercer Island 2011-2012 Budget B-1
Budget Message
In 2004, using a process loosely based on the State of Washington’s “Priorities of Government,” the
City Council adopted six City priorities to serve as a filter through which significant changes to City
services and programs could be evaluated:
1. The community will be safe.
2. The community will support effective, efficient and legal delivery of public services.
3. The community will support reliable public infrastructure and protect its
considerable public investments (e.g. water, sewer, storm water utilities, streets,
parks, and buildings).
4. The community will support attractive, high quality neighborhood and business
environments.
5. The community will support a broad range of recreational, cultural, health and
educational opportunities.
6. The community will support open and informed public involvement processes
within the structure of representative, democratic decision making.
A complete listing of the priorities and their sub-priorities can be found in Appendix A at the end of
the Budget Message.
The proposed 2011-2012 Budget continues to confirm what was discovered back in 2004 with the
development of the 2004-2005 Budget, namely that:
• The City spends most of its resources on its highest priority services and projects.
• The City provides the highest General Fund tax support for its highest priority services – police;
fire; infrastructure maintenance (streets and parks); and administrative services that ensure the
legal and efficient running of the City like Finance, Human Resources, City Attorney’s Office, and
City Manager’s Office.
• The services that are least tax-supported from the General Fund are those for which the City
can “sell” the service through user fees and utility rates (recreation, youth and family counseling,
development permits, and utility services).
• The services for which the City has some of its most accurate data on individuals served are
those services most associated with user fees. Those services are also often associated with
active and supportive constituencies (recreation programs, leagues, seniors, and schools-related
groups).
• The City spends comparatively less in services aimed at public information and public
involvement.
How Service Reductions were Selected
In considering service reductions, the City's Management Team remained mindful of five aspects of City
services:
1. Focus primarily on General Fund services – those services primarily supported by taxes,
particularly those tax revenues that have shown significant reductions.
2. Avoid service reductions that already are associated with significant fee revenue or external
grant support.
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B-2 City of Mercer Island 2011-2012 Budget
Budget Message
3. Council's adopted Priorities of Government
4. The mandatory, essential or discretionary status of specific services.
5. The community's satisfaction with City services as expressed in the biennial citizen survey.
While sorting through the over 140 individual City services for potential service reductions is difficult,
the Management Team was able to maintain basic health and safety functions of the City. In nearly every
case, services are reduced in quantity or quality but not completely eliminated. The areas for
recommended service reductions most often occur in discretionary municipal functions - neither
mandated by state law or essential to the proper, legal functioning of the City. The Management Team
focused on the “business case” for maintaining, reducing or eliminating specific programs. Although the
relative popularity of programs was not a significant factor in the staff’s analysis, it is assumed that it will
be a factor in the City Council’s review of the budget.
Performance Measures
This biennial budget will continue to identify key performance measures that can be tracked through the
budget period. Performance measures are linked to the City’s budgetary resources (inputs) and to the
City Council’s values (outputs and outcomes) as expressed in the City Priorities. By tracking
performance measures over time, the City hopes to create an ongoing link between its stated goals and
priorities and how resources are applied. Periodic reporting of performance objectives and results will
be presented to the City Council and community via the “MI Dashboard Report” compiled by the
Finance Department.
Financial Status
Due to a long history of constraining expenditure growth, conservatively estimating revenues, and
maintaining a sizeable debt capacity, the City’s financial condition remains solid. This statement is
validated by Moody’s Aa2 LTGO bond rating of the City in 2009. Nevertheless, the City’s finances have
become increasingly sensitive to fluctuations in the regional and national economy that are beyond its
control. The current economic recession coupled with the effects of taxpayer initiatives have had
significant impacts on some City revenue streams – most notably sales tax, real estate excise tax, utility
tax and property tax receipts. Reduced revenues and stagnate economic growth have produced
significant downward pressure on employee compensation and benefits. These expenditure and revenue
trends are discussed below.
Key Expenditure Trends
• Employee Wages & Benefits – Over the last 18 months, the City has implemented a number of
measures to slow and stop employee wage and benefit growth. Although the City is constrained by
union contract terms, it has been successful in implementing the measures via voluntary agreements
from each of its unions:
0% cost-of-living adjustments (or equivalent reduction) for all union and non-union
employees;
Rolling hiring freezes on all vacancies,
Discontinuance of market-based wage analyses and adjustments;
Discontinuance of pay-for-performance program.
• Health Care Costs – The City continues to benefit from long-standing practices of employees
sharing in their health care costs. The City also strives to move all remaining employee groups
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City of Mercer Island 2011-2012 Budget B-3
Budget Message
toward lower-cost PPO health care plans.
• Development Review Staffing – Development activity locally and regionally has slowed
measurably from the record pace experienced over the middle part of the decade. In 2009-2010,
residential development slowed down 33% from 2005-2006 levels (as measured by the number of
building permits issued). Town Center and other commercial/multi-family development have slowed
as well, reducing the need for development review personnel and contracted labor.
Recognizing the development downturn, the City has reduced its contracted in-house staff by 3.0
FTE's in the 2009-2010 biennium. Going forward, the City plans to further reduce its budget for
contracted outside labor (planners, engineers and plans examiners) by about $290,000. It will also
consolidate many of the reduced contracted services into one contracted in-house position in order
to meet basic permit review obligations. Overall, the Development Services Department is
committed to maintain permit review turnaround times targets albeit with substantially reduced
resources.
Overall, the pace of expenditure growth in the City’s current and proposed General Fund has stalled to
a virtual no-growth position. 2011 and 2012 expenditures will be at or below actual expenditures in
2008 – the “peak” expenditure year. Adjusted for inflation, the City’s General Fund expenditures have
dropped to 2007 levels – this in spite of the run-up in development activity at the height of the “housing
bubble” and the Council’s interests in parks and open space maintenance. Up to the 2011-2012
biennium, the City has not reduced any services provided to the taxpayers/residents.
When looked at from a longer perspective, the City’s General Fund expenditure growth, adjusted for
inflation, has increased by an average of 1.5% per year over the last ten years and .7% per year over the
last six years.
General Fund Expenditures 2001 – 2012
$30
$millions
$25 $23.98 $23.67
$23.46
$22.78 $22.96
$21.74
$20 $19.11 $18.79
$17.58 $19.70
$16.61 $18.74 $19.00 $18.80
$16.34 $18.61 $18.41
$16.00
$17.68
$16.73 $16.81
$15 $16.00 $16.03 $16.02
$10
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Expenditures ($mill.) Proposed Budget Infla. Adjustments ($mill.) Proposed Budget (assumes 1.0% inflation)
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B-4 City of Mercer Island 2011-2012 Budget
Budget Message
Key Revenue Trends
Citizen Initiatives
• Initiative 695 - Motor Vehicle Excise Tax Repeal – With the Legislature’s 2000
enactment of Initiative 695, the City experienced a loss of approximately $1.1 million per year
in annual Motor Vehicle Excise Taxes (via sales tax equalization) – approximately 9% of General
Fund revenues. The City continues to adjust to this loss of General Fund revenue through a
mixture of constrained expenditures and growth in more volatile revenues such as sales taxes
and permit fees.
• Initiative 747 - Property Tax Limitation – Further constraining revenues, the City’s single
largest source, property taxes, saw relatively low growth during the early part of the decade.
Since passage of Initiative 747 in 2001, the City has been limited to annual property tax
increases of 1%. Throughout the past ten years, the cost of basic services has increased at an
average of 5.0% per year. In three of the past seven years, the City Council increased the
property tax 1% but refunded 1% back to taxpayers from year-end revenue surplus in the
General Fund. In 2007, the City Council approved a slight increase in property taxes above the
1% threshold using “banked capacity” to generate a long-term funding stream for fire apparatus
replacement. In 2009, the City Council voted to maintain a 0% optional property tax increase
as an alternative to a 1% property tax decrease.
• Initiatives 1100 & 1105 - Privatization of Liquor Sales – Initiatives 1100 & 1105 each
propose to end the state’s monopoly on liquor sales and, instead, “privatize” the retail sales of
spirits. Both Initiatives will be decided by Washington voters in the November, 2010 general
election. Depending on which Initiative is approved, cities and counties will experience a
significant reduction in liquor sales and profits tax revenues. In recognition of the policing costs
associated with alcohol consumption, 40% of all liquor board profits tax revenues are
distributed to cities based on population and 28 % of liquor excise taxes are distributed to
cities. In the aggregate, $54.6 million will be distributed to cities in 2010. Mercer Island’s
estimated share of 2010 liquor board profits and excise taxes is $301,000.
Sales Tax
The recession has generated a significant reduction in sales tax receipts, particularly in the area of
construction sales tax. Finance staff is estimating a cumulative reduction of $1.27 million in construction-
related sales tax in 2009-2010 compared to 2008. In 2011-2012, Finance staff is forecasting $1.14
million less than received in 2008. The projected declines can be attributed to the mid-2009 completion
of two major projects in the Town Center and a significant decline in residential construction.
The graph below displays actual and projected total sales tax revenues as well as construction-related
sales tax revenues for 2001-2012.
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City of Mercer Island 2011-2012 Budget B-5
Budget Message
Sales Tax 2001-2012
$millions
$5.00
$4.36
$4.50
$3.95
$4.00 $3.68
$3.50 $3.13
$3.00 $2.68 $2.57 $2.64 $2.63 $2.57 $2.60 $2.70
$2.52
$2.50
$2.00
$1.50
$1.61 $1.62
$1.00 $1.32 $1.30 $1.24
$1.03 $1.05 $1.00 $1.10
$0.50 $0.92 $0.91 $0.93
$0.00
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Total Sales Taxes Construction Sales Tax
Total Sales Tax-Budget Total Construct Sales-Budget
Development Services (Permit Processing)
Between 1999 and 2007, the City saw a significant increase in single-family home development/
remodeling and commercial construction. In 2000, the Development Services Group (DSG) processed
a record 2,937 land use, single family, commercial, and over-the-counter permits. That pace increased
to 3,205 permits in 2005. In 2006, building construction valuation peaked at almost $96.0 million. In
what many economists have since labeled the "housing bubble", these increases were largely driven by
low cost financing for home remodels, new construction and the redevelopment of the Town Center.
To provide some additional context, key development statistics for 2001-2012 are presented below.
Development
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Statistics
Single Family
250 237 246 377 396 374 293 195 149 140 158 158
Residential Permits
Commercial/Multi-
50 47 63 89 58 80 56 46 49 40 40 40
Family Permits Issued
Over the Counter
2,319 2,143 1,896 2,465 2,656 2,589 2,572 2,000 1,028 1,100 1,000 1,000
Permits Issued
Total Building
$48.80 $47.70 $26.83 $93.53 $80.13 $95.91 $86.26 $40.11 $30.93 $75.00 $30.00 $30.00
Valuation ($mill.)
Total Development
$0.99 $1.09 $0.98 $1.38 $1.69 $1.62 $1.70 $1.45 $1.13 $1.00 $1.25 $1.25
Fees ($mill.)
_________________________________
B-6 City of Mercer Island 2011-2012 Budget
Budget Message
Building Permits 2001-2012
450
396
400 377 374
350
293
300
250 246
237
250
195
200 158 158
149 140
150
89 80
100 63 58 56
50 47 46 49 40 40 40
50
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Single Family Permits Commercial Multi-family
Single Family - Budget Commercial - Budget
Total Development Fees 2001-2012
$millions
$1.80 $1.69 $1.70
$1.63
$1.60
$1.45
$1.38
$1.40
$1.25 $1.25
$1.20 $1.09 $1.13
$0.99 $0.98 $1.00
$1.00
$0.80
$0.60
$0.40
$0.20
$0.00
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Total Development Fees Total Development Fees- Budget
Compared to the 2005 peak year, 2009 single family residential permit activity decreased by over 60%,
and 2009 building valuations decreased by more than 60%. Given these decreases, the 2009-2010
budget included a number of staffing reductions to reset the “core staff” complement. DSG's
“contingent staff” (i.e. contract employees) were reduced by 3.0 FTE’s. In the proposed 2011-2012
budget, DSG will further reduce its contracted external labor by about $290,000. They will consolidate
much of the remaining work by retaining an existing contract Plans Examiner position.
_________________________________
City of Mercer Island 2011-2012 Budget B-7
Budget Message
See Development Review Fees policy in Section C (Budget Policies) for more details.
Budget Summary
At its highest level of generalization, this budget can best be summarized in the following ways. The
2011-2012 Budget:
• Reduces General Fund expenditures in light of reduced General Fund revenues. Relies on a mix
of non-service budget reductions, selected service and staff reductions, targeted fee increases
and the optional 1% property tax increase.
• Reduces services in selected areas while maintaining essential health and safety functions.
• Provides continued investments in basic infrastructure for Streets, Water, Sewer, and Storm
Water facilities with associated utility rate increases.
General Fund – Revenue Sources
Reflecting the recent trends mentioned above, the General Fund continues to receive nearly all of its
operating revenues from the same tax sources in approximately the same proportions as previous years,
with the exception of property tax and sales tax. A breakdown of the budgeted major revenue sources
for 2011-2012 is provided below.
General Fund Revenues
2011-2012
Recreation Programs District Court Fines
6% 2%
General Government Interfund Transfers In
2% 2%
Licenses and Permits
8%
EMS Revenues
5% Property Tax
44%
Utility Overhead
3%
State Shared Revenues
2%
Business & Utility Taxes
15% Sales Tax
11%
Total budgeted General Fund resources for 2011 and 2012 are $22,963,098 and $23,665,296
respectively.
_________________________________
B-8 City of Mercer Island 2011-2012 Budget
Budget Message
Department Operating Budgets
The City continues to dedicate the largest portions of its resources to Public Safety (police, fire, and
medical aid) and Maintenance. As shown below, the combined operating budgets for these areas
account for $48.6 million, or 63%, of total operating expenditures for the 2011-2012 biennium.
2011-2012 Operations by Department
30.00
20.00
Millions
10.00
0.00
Staffing
Reflecting only the organization’s most pressing staffing needs given the current economic environment,
the City’s 2011-2012 staffing model will see a net 5.65 FTE decrease for ongoing “budgeted” positions
and a net 0.5 FTE decrease for “contract” positions (excluding CIP). Staffing changes are listed below:
Proposed Reductions in Regular “Budgeted” Employees:
• Reduce Right-of-Way Maintenance – 1.0 FTE
• Reduce Transportation Manager – 1.0 FTE
• Reduce Special Events/Recreation Programmer – 0.25 FTE
• Reduce Court Administrator – 0.5 FTE
• Reduce Police Records Clerk staffing – 0.5 FTE
• Reduce Patrol "Hire Ahead" position (when vacant) – 1.0 FTE
• Reduce Communications Coordinator – 0.4 FTE
• Reduce MIYFS Development Coordinator – 0.5 FTE
• Reduce MIYFS VOICE Coordinator – 0.5 FTE
_________________________________
City of Mercer Island 2011-2012 Budget B-9
Budget Message
Proposed Reductions in Contract Employees (excluding CIP):
• Eliminate Planner (contract, vacant) – 1.0 FTE
• Eliminate ROW Arborist (contract) – 0.5 FTE
• Eliminate Recreation Coordinator (contract, vacant) – 1.0 FTE
• Reduce Fire Marshal (contract) – 0.25 FTE
Proposed Increases in Contract Employees (excluding CIP):
• Re-budget Plans Examiner – 1.0 FTE
• Re-budget Resource Conservation Manager – 0.25 FTE
Proposed Reductions in Contract Employees (CIP Only):
• Eliminate Facilities Project Manager (vacant) – 1.0 FTE
• Eliminate CIP Administrative Support (vacant) – 0.5 FTE
• Eliminate CIP Project Manager – 1.0 FTE
• Eliminate Records Management Coordinator – 1.0 FTE
The total number of regular (i.e. ongoing) and contract employees approved for the period 2003-2010
and proposed for 2011-2012 is displayed below.
10 Year Staffing (FTE’s) History
2003-2012
195.00
190.00
185.00
180.00
175.00
170.00
165.00
160.00
155.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Contract FTE 5.75 5.75 8.35 13.25 9.50 9.50 8.75 10.75 8.00 8.75
Regular FTE 173.40 173.40 169.75 168.75 177.15 177.65 179.40 179.40 173.75 173.75
_________________________________
B-10 City of Mercer Island 2011-2012 Budget
Budget Message
To provide some perspective on how Mercer Island compares to six other full service cities on the
Eastside, two statistics are provided in Appendix B at the end of the Budget Message:
• 2010 total number of employees per 1,000 population
• 2009 General Fund expenditures per capita
For each measure, Mercer Island is at the bottom of the list, reflecting the City’s culture of leanness and
frugality.
Biennial Budget Issues & Initiatives
Entering the biennium, the City faces a nearly $2.9 million deficit. Driven by significantly lower revenues
from the previous two biennia, the City must significantly reduce expenditures, increase revenues or
both. Largely following the wishes of the City Council as voiced in the summer of 2010, the proposed
2011-2012 Budget relies most heavily on expenditure reductions, followed by selected fee increases and
the optional 1% property tax increase. The table below summarizes the balancing strategy proposed in
the General Fund Budget.
Budget Balancing Strategy
General Fund
2011 2012 Total
Projected Deficit ($2,893,099) ($3,039,008) ($5,932,107)
2010 Service Packages & Other
One-Time Costs 665,773 665,773 1,331,546
Net Non-Service Level Reductions 768,031 768,031 1,536,062
Service Level Reductions 740,789 756,011 1,496,800
Revenue Loss from Service Reductions (6,000) - (6,000)
Service Enhancements (171,659) (170,104) (341,763)
Fee Increases 439,500 568,000 1,007,500
1% Optional Property Tax Increase 103,165 104,797 207,962
Grants 7,000 - 7,000
"Rainy Day" (Contingency) Fund 346,500 346,500 693,000
Balance $0 $0 $0
In all, General Fund reductions amount to $1.51 million in 2011 and $1.52 in 2012. This is in addition to
the $665,773 in one-time budget increases in 2010 that have been dropped from the upcoming
biennium. The reductions come from two categories: Non-Service Level Reductions and Service
Level Reductions. A detailed explanation of the proposed budget reductions follows.
_________________________________
City of Mercer Island 2011-2012 Budget B-11
Budget Message
Non-Service Level Reductions
Before seeking service reduction proposals from City departments, the Finance Director and City
Manager asked Department Directors and their staff members to identify reductions in the budgets that
would not reduce service to the public but would reduce reliance on cash-strapped General Funds. In
all, departments identified $864,985 in ongoing, non-service level reductions, which are listed below.
2010 Salary and Benefit Savings $ 263,016 Move CBD Utility Costs to Beautification $ 34,000
2011 COLA Savings $ 127,000 Advertising & Postage $ 32,691
Expiration of Yakima Jail Contract $ 103,460 Misc Recreation Reductions $ 26,572
Technology CIP Funding $ 75,000 Telephone Costs $ 25,025
NORCOM Fees (Police & Fire) $ 59,293 Annual General Fund Subsidy to YFS $ 25,000
Travel & Training $ 39,199 Issaquah Jail Bed Commitment $ 15,555
Marine Patrol Program $ 39,174
Service Reduction Packages
Police
• Records Clerk (0.5 FTE) – Currently two full time Records Clerks maintain police records.
The service reduction package proposes a .5 FTE reduction. Law enforcement personnel
routinely access these records in order to learn of criminal backgrounds, outstanding warrants,
contact information and physical characteristics. Reducing by .5 FTE will result in a reduction of
hours the Records window is open to the public.
This package reduces the General Fund budget by $38,755 in 2011 and $40,392 in 2012.
• Police “Hire Ahead” Position (1.0 FTE, Criminal Justice Fund) – The Department
currently has two budgeted “hire ahead” positions. The reduction package proposes the
elimination of 1.0 FTE for the 2011-2012 biennium only. The “hire ahead” positions are used to
provide an “over-staffing” of qualified, trained police officers. Upon retirement, lateral transfers
or disabilities of police officers, a fully functional officer can immediately be moved into the
regular officer slot. In turn, the vacant “hire ahead” position is then used for recruitment and
training of a new officer – a process which can take up to one year. Hire ahead positions are
used chiefly as a tool for managing overtime. With the elimination of one hire ahead position,
the Department will estimate and budget for additional overtime costs.
This package reduces the Criminal Justice Fund budget by $89,614 in 2011 and $96,434 in 2012.
Fire
• Fire Marshal (0.25 FTE) – The Fire Department currently has a full time, contract Fire
Marshal whose duties include plans review and permitting under the International Fire Code,
inspections of businesses and public education. This reduction package contemplates a reduction
in Fire Marshal hours of 25%. This reduction is consistent with the decline in permit activity
over the last year and what is projected for the biennium.
This package reduces the General Fund budget by $25,475 in 2011 and $26,450 in 2012.
_________________________________
B-12 City of Mercer Island 2011-2012 Budget
Budget Message
Court
• Court Administrator (0.5 FTE) – In 2009-2010 the City added a full-time clerk to assist
in addressing the heavy caseload issue in the Mercer Island Municipal Court. That addition was
successful in addressing the backlog of work and now allows for the half-time reduction of the
Court Administrator position – a position fundamentally different than the Court Clerk. A
half-time reduction of the Court Administrator position for the 2011-2012 budget will still
allow for necessary reporting and accounting functions to continue with minimal change in the
level of service.
This package reduces the General Fund budget by $45,885 in 2011 and $47,747 in 2012.
Maintenance
• Facilities Maintenance Technician (0.5 FTE) – This position was originally budgeted and
approved in the 2009-2010 budget. As originally intended, the position would have
supplemented the 1.0 FTE Facilities Maintenance employee whose activities are largely focused
on repair and maintenance contract management. As the City’s financial condition worsened in
early 2009, the Finance Director and City Manager decided not to fill the position as a cost
savings measure. This package would eliminate this vacant position from the budget. From the
General Fund’s perspective, there is only a 0.5 FTE reduction, because the remaining Facilities
position will be split 50/50 between the General Fund and the CIP in 2011-2012.
This package reduces the General Fund budget by $42,866 in 2011 and $44,579 in 2012.
• ROW Arborist (0.5 FTE) – The existing contract Right of Way (ROW) Arborist would be
eliminated. The primary impact will be a reduction in responses to citizen’s concerns regarding
hazardous trees in the street right of way, reviewing applications for pruning, determining tree
ownership within the ROW and managing tree maintenance contractors. Some amount of
response can be made by the Development Services Arborist and Park Arborist on the most
significant and/or emergent hazard tree cases.
This package will reduce the Street Fund budget by $44,760 in 2011 and $46,515 in 2012.
• ROW/Trail Maintenance Reorganization (1.0 FTE) – One Right of Way (ROW) Team
Member position would be eliminated. Currently, the ROW Team provides maintenance 3 to 6
times per year on 38 trail segments totaling 4.7 miles. The maintenance of ROW trails would
be shifted to Parks Maintenance, which already maintains trails in Parks and Open Spaces and is
more efficient at performing this type of work. A small amount of budget ($20,000) allocated
for operating supplies and specialized contractor services (such as the repair of concrete stairs
on trails) would be shifted to the Parks Maintenance budget. It is anticipated that this
consolidation of all trail maintenance within Park Maintenance would have no significant impact
on the current of level of service. The impact on other Parks Maintenance work is expected to
be modest.
This package reduces the General Fund budget by $85,733 in 2011 and $89,156 in 2012.
• Right of Way (Casual Labor) – This package reduces seasonal (part-time) employees from 3
to 2. This reduction was implemented in 2009-2010 and will continue into the next biennium.
Historically, these seasonal workers perform trail maintenance, vegetation removal and flagging
for full-time employees involved in street maintenance/construction work.
_________________________________
City of Mercer Island 2011-2012 Budget B-13
Budget Message
This package will reduce the General Fund budget by $12,150 in 2011 and 2012.
• Tree Planting Program – In the 2010-2011 biennium, the City budgeted $10,000 each year
for planting trees. During that time, over 300-350 trees were planted or planned to be planted
in public and private spaces.
This package would reduce the General Fund budget by $10,000 in 2011 and 2012.
Development Services
• Transportation Manager (1.0 FTE) – The existing Transportation Manager position would
be eliminated. Some duties currently contained in the position would be transferred to other
positions. Some functions would be reduced or eliminated as follows:
Evaluation of traffic impacts of development proposals and conformation of appropriate
mitigation measures would be reduced.
Response to citizen-initiated traffic engineering concerns, traffic and parking complaints,
signage modifications, pavement marking, traffic calming would be reduced and shifted to
engineers in the Maintenance Department.
Coordination of regional traffic issues, such as I-90 HOV project work, East Link light
rail, WSDOT, Eastside Transportation Partnership would be reduced and/or staffed by
non-engineers from the City Manager’s Office and DSG.
Annual updates of the Transportation Improvement Plan (TIP) would be shifted to the
City Engineer and Asst. City Engineer.
Oversight, design and construction management of the Pedestrian Bicycle Facility Plan
would be reduced and shifted to the street engineering staff in Maintenance and/or
outside consultants.
Coordination and management of Commute Trip Reduction, MI Permit Parking and
traffic collision database updates would be reduced.
Other areas affected will include: staffing of the MISD Master Planning effort, the City’s
Transportation Concurrency program, and remaining current on changes to national
traffic regulations and standards.
This package will reduce the General Fund budget by $87,353 in 2011 and $90,538 in 2012, and it
will reduce the Street Fund budget by $36,826 in 2011 and $38,191 in 2012.
Parks & Recreation
• Parks Maintenance LOS B to C – This reduction would re-designate certain parks from
level-of-service “B” to level of service “C” maintenance thereby reducing the number of
seasonal and full-time worker hours needed for overall park maintenance. The affected parks
will be Groveland Beach, First Hill Park, Ellis Pond, Clarke Beach, Slater Park, Secret Park,
Rotary Park, Roanoke Park and Pioneer Park. In general, maintenance will change from a
regular scheduled mowing and turf maintenance to an as-needed basis. Each park will be visited
once per week rather than 2 times per week for garbage/litter pick-up, restroom cleaning and
playground checks.
_________________________________
B-14 City of Mercer Island 2011-2012 Budget
Budget Message
This package will reduce the General Fund budget by $79,000 in 2011 and 2012.
• Summer Celebration Fireworks – Each year, Summer Celebration includes a fireworks
display as part of a community picnic at Luther Burbank Park. The display and picnic cost
$24,500 to produce, with an annual income of $5,000 in food vendor fees and donations. This
reduction is made with the hopes that private fund raising can replace City General Fund
support.
This package will reduce the General Fund budget by a net amount of $19,500 in 2011 and 2012.
• Groveland Beach Lifeguard – The City provides lifeguards at Luther Burbank and
Groveland Beach Parks. Seventeen lifeguards and one Beach Manager are hired as casual labor
to staff the late June to late August beach program. Lifeguards were removed at Clarke Beach
in 2003. This package would remove lifeguards at Groveland Beach but maintain them at Luther
Burbank Park.
This package will reduce the General Fund budget by $24,200 in 2011 and 2012.
• Recreation/Arts Programs/Special Events – This reduction includes the elimination of the
following events, which are wholly funded by the General Fund and are discretionary programs
that generate little or no fee revenue: Mostly Music in the Park, Shakespeare in the Park,
Outdoor Summer Films, Spring Egg Hunt, Arts Council Winter Dance, Family Valentine Winter
Dance and the Volunteer Recognition Party. The reduction package also includes the
elimination of the Fun Mobile and the new Adventure Playground. With the reduction in these
programs, a reduction of .25 FTE will occur from the Arts and Special Events Coordinator
position.
This package will reduce the General Fund budget by a net amount of $69,053 in 2011 and
$69,095 in 2012.
Youth & Family Services
• General Fund Subsidy – The City’s adopted Management & Budget Policy for Youth &
Family Services Financing stipulates that each year the General Fund will contribute $465,000 to
departmental activities. All other financing must come from grants, fees, donations and MIYFS
Thrift Shop revenues. The following three budget actions will reduce the General Fund subsidy:
The financing policy is amended in this biennial budget to a reduced General Fund
contribution of $440,000, a decrease of $25,000. This General Fund reduction is
expected to continue indefinitely and is expected to be replaced by increased Thrift
Shop revenues.
For the 2011-2012 biennium, an additional $80,000 of General Fund subsidy will be
reduced. This biennial reduction is expected to be replaced with increased Thrift Shop
revenues on an ongoing basis.
For each year in the biennium, $40,000 of the YFS Fund balance (and/or MIYFS
Foundation grant funds) will be dedicated to department programs thereby further
reducing the General Fund subsidy by $40,000. This is intended to be a temporary
reduction for the 2011-2012 biennium only.
_________________________________
City of Mercer Island 2011-2012 Budget B-15
Budget Message
This package of budget actions will reduce the General Fund budget by $145,000 in 2011 and
2012.
• Development Officer (0.5 FTE) – In 2007, MIYFS brought on a Development Officer on a
full-time basis to generate additional donations and grants for the department and MIYFS
Foundation. In early 2010, this position became vacant and was later re-filled on a half-time
basis. This reduction will continue the .5 FTE reduction implemented in 2010. There is no
expected reduction in donations and grants from this package.
This package will reduce the YFS Fund budget by $42,398 in 2011 and $44,080 in 2012.
• VOICE Coordinator (0.5 FTE) – This package will reduce the Youth Development
Coordinator position (VOICE). The reduction will result in the elimination of department-
based VOICE programming during the school year. The popular summer VOICE program will
be maintained. To further reduce costs, the .5 FTE Youth Development Coordinator will merge
with the existing .5 FTE Islander Middle School Prevention and Intervention Specialist,
commonly referred to as the “IMS Drug and Alcohol Counselor”, to create a 1.0 FTE Youth
Development/School-Based Preventionist position. This merger will result in a reduction in
capacity for school-based professional counseling/drug and alcohol assessment and intervention
services at IMS. Instead, drug and alcohol prevention services (as opposed to intervention or
counseling) will be offered.
This package will reduce the YFS Fund budget by $32,872 in 2011 and $34,255 in 2012.
City Manager's Office
• Communication Coordinator (0.4 FTE) – The Communications Coordinator position was
first funded as a full-time position in 2006 on a contractual basis and then converted to an
ongoing budgeted position in 2007. In mid-2010, the position was reduced and re-filled on a .60
FTE basis. The position is currently focused on maintaining basic community communication
functions of weekly electronic newsletters, semi-annual mailed newsletters, website postings,
press releases, managing media contacts and supervising contracted services for cable broadcast
functions of City Council meetings.
This package will reduce the General Fund budget by $50,319 in 2011 and $52,314 in 2012.
Non-Departmental
• Reinvesting in Youth – Reinvesting in Youth (RIY) is a county-wide multi-organization effort
to find and implement best practices to reduce the youth school drop-out rate. Benefits from
RIY go primarily to youth residing outside Mercer Island.
This package will reduce the General Fund budget by $4,000 in 2011 and 2012.
• Outside Human Service Contracts – The City has support contracts with four regional
human service agencies. Although available to Mercer Island citizens, each has low utilization
from local residents. Local police and Mercer Island Youth & Family Services will continue to
provide referrals and/or direct counseling for local residents needing assistance. The four
agencies and their respective contract amounts subject to elimination are:
_________________________________
B-16 City of Mercer Island 2011-2012 Budget
Budget Message
Eastside Domestic Violence Center – $10,000 (Criminal Justice Fund)
Eastside Legal Aid Program – $3,500
King County Sexual Assault Center – $2,500
Children’s Response Center – $1,500
This package will reduce the General Fund budget by $7,500 in 2011 and 2012 and the Criminal
Justice Fund by $10,000 in 2011 and 2012.
Sustainability
Since the early 1990’s, the City has been a regional leader in resource conservation. The City has
experienced significant success in recycling and solid waste stream diversion, water conservation, storm
water quality improvements, building energy efficiencies, and invasive species removal.
The City will continue to be active in sustainable activities, particularly where the activity generates
savings in capital investment and operations costs. In the coming biennium, the City will continue its
activities in the following areas:
• Fleet Operations – Reduce green house emissions and fuel consumption through acquisition
policies and operational best practices.
• Healthy Neighborhoods – Implement the Bicycle & Pedestrian Plan, facilitating greater
reliance on human powered transportation.
• Water Quality – Identify and implement Low Impact Development projects through regional
grant fund sources.
• Energy & Resource Conservation – Continue recycling goals, water conservation, and
partnership with Puget Sound Energy for a Resource Conservation Manager to oversee energy
conservation efforts by City staff.
• Grass Roots Efforts – Partner with the Green Ribbon Commission to advocate for voluntary
energy savings and emissions reductions in local homes and businesses.
The costs for most of these activities will be covered by savings generated from higher resource
efficiencies and one-time funding, as needed. See Sustainability policy in Section C (Budget Policies) for
more details.
New/Enhanced Revenues
Property Tax – 1% Optional Increase
Mercer Island continues to be highly dependent upon the property tax for funding its basic services (44%
of total revenues in 2011-2012). Generally, Mercer Island and other “bedroom communities” have a
lower reliance on sales tax receipts and, consequently, a higher reliance on local property taxes. Given
the volatility of retail sales tax revenues, especially construction-related sales tax, and development fees,
the proposed 2011-2012 Budget assumes a 1% Council-approved property tax increase.
See Property Tax policy in Section C (Budget Policies) for more details.
Fee Increases
In order to balance the biennial budget without over-reliance on reserves or service reductions,
the following fee increases are proposed:
_________________________________
City of Mercer Island 2011-2012 Budget B-17
Budget Message
• Ambulance Transport Fees – Private ambulance companies and Mercer Island Fire
Department Aid Units transport approximately 900 patients to local hospitals on an annual
basis. Currently, when transported by a private ambulance carrier, a charge is passed on to the
patient’s insurance carrier. When transported by the Fire Department, the service is given for
free. This proposal would seek authorization to charge citizens being transported to the local
hospital at a flat rate of $500, which is approximately $300, or 37.5%, less than private
ambulance carriers. This proposal would reduce the use of private carriers.
This proposal is projected to generate new General Fund revenue, net of billing costs and uncollectible
account write-offs, of $225,000 in 2011 (based on an April 1, 2011 implementation) and
$300,000 in 2012.
• Development Services
Building Valuation Table/Fees – The City has had a long-standing policy to move
towards full cost recovery for building and land use permitting costs. In a 2009 analysis
of DSG activities, staff concluded that 94% of costs eligible for recovery were received
in permit fees. The 2009 analysis also concluded that the City should continue to refine
eligible "indirect costs" for legal, facility and services provided by other departments.
In a 2010 review of the permit fee calculation methodology, staff concluded that one
aspect of the permit fee structure warranted updating. Currently, the value of new
residential construction is set at $116 per square foot (SF). This rate is multiplied by the
size a project and thereby sets the permit fee. This out-dated rate is very low for
residential construction on Mercer Island. The King County Assessor has determined
that the 2008 Mean Assessed Value per square foot (SF) for all newly built homes
(2000-2007) is $258.20/SF. Many Mercer Island projects exceed $300/SF. Staff
recommends a modest increase of $26.50/SF (from $116 to $142.50) to support
building permit services.
Based on 2010 construction activity, this change will generate new General Fund revenue of
$135,000 in 2011 and 2012.
Fire Marshal Fees – The Fire Marshal conducts plan review and permitting functions
as they relate to the International Fire Code. The application of the Code is coordinated
with local fire department equipment, operational practices and capabilities. The Fire
Marshal works closely with DSG personnel to track Fire Code permit review costs so
that they can be included in permit fees. Fire and DSG staff have reviewed current
review practices and have concluded that an important amount of Fire Marshal permit
review time has not been included in permit fee calculations.
Based on 2010 construction activity, staff has conservatively estimated that this change will
generate additional General Fund fee revenue of $45,000 in 2011 and 2012.
• Parks & Recreation
"Ballfield User Groups" (BUG) Access Fee – Since the creation of the "Ballfield
Users Group", members of the group pay no rental fees for the use of City's athletic
fields. The largest BUG users include: Boys & Girls Club, the Youth Soccer
Association, and both boys and girls Lacrosse. BUG users are currently paying for extra
fees, which include field lighting and field preparations such dragging and lining. Mowing
_________________________________
B-18 City of Mercer Island 2011-2012 Budget
Budget Message
and field maintenance is provided by the Department at no cost. Compared to most
cities with athletic field complexes, this is an unusually high level of service. Beginning in
2011, the Department proposes to charge a base rental fee of $11.00 per hour to BUG
field users. The proposed rate is less than the rental rate currently charged to non-
BUG users so they will continue to receive a discount as a result of BUG membership.
Based on past utilization, this change will generate new General Fund revenue of $34,500 in
2011 (assuming a July 1, 2011 implementation) and $ 69,000 in 2012.
Community Center Rental Fees – Rental rates have been the focus of review by
the City Council for several years, generally with the goal of maximizing local use of the
facility while minimizing General Fund operational subsidies. Although these two goals
sometimes conflict, staff has worked to balance realistic market-based rental rates with
citizen expectations for reasonable access to the facility. Based on a recent review of
rates, Park Department staff recommends rate increases in three areas: Rotary Club
annual rental, MI Community Service Rates, and general room rental rates. In order to
provide ample advance notice to tenants, these rental rate increases are proposed for a
2012 implementation.
These rental rate increases will generate new General Fund revenue of $25,000 beginning in
2012.
• MIYFS Thrift Shop – The Mercer Island Youth & Family Services Thrift Shop was created to
generate financial support for social service programs at MIYFS. Through the re-sale of donated
household goods, the Thrift Shop continues to grow in activity and sales, with an estimated
$900,000 in gross receipts projected in 2010. In order to decrease General Fund support to
the YFS Fund, the Thrift Shop is expected to generate an additional $105,000 in revenue over
and above 2010 budgeted amounts. See YFS Financing policy in Section C (Budget Policies).
While Thrift Shop staff believe this is a realistic target, it should be noted that new grants,
increased donations, fees or expenditure reductions will be required to maintain General Fund
subsidies at targeted levels if sales do not generate the additional planned revenues.
This increase in sales will generate new revenue to the YFS Fund of $105,000 in 2011 and 2012.
“Rainy Day” (Contingency) Fund
The City’s Contingency Fund Policy sets a reserve balance goal of 10% of General Fund expenditures.
As of January 2010, the Contingency Fund balance was $2,344,335. In November 2009, the City
Council approved the use of the $300,000 revenue stabilization reserve in the General Fund to address
the 2009 revenue shortfall. Later in 2010, the City Council modified the Contingency Fund Policy to
provide more specific direction for use of reserves to respond to major downturns in City revenues.
In March 2010, the Council appropriated $478,522 from the Contingency fund to address the 2010
revenue shortfall. In a June 2010 discussion about future budget balancing, the City Council again
indicated its willingness to allocate Contingency reserves to the 2011-2012 budget. The Council agreed
with the Finance Director’s recommendation to use no more than 50% of the Fund’s targeted policy
amount to balance the 2011-2012 budget, retaining the remaining 50% for an emergency (e.g. natural or
man-made disaster) or a significant unexpected expenditure. Accordingly, the proposed budget includes
an allocation of $346,500 in each year of the biennium to balance the General Fund budget.
_________________________________
City of Mercer Island 2011-2012 Budget B-19
Budget Message
Transportation Benefit District (TBD)
A TBD is a quasi-municipal corporation and independent taxing district created for the purpose of
acquiring, constructing, improving, providing, and funding transportation improvements. The
improvements can be for maintenance of City streets, investments in high capacity transportation, public
transportation, and transportation demand management. A TBD can also fund the operation,
maintenance, and preservation of existing streets and trails.
In Mercer Island's case, it would be created and governed by the City Council. While there are multiple
revenue options available, the most common is a $20 annual vehicle fee. This can be enacted by a vote
of the City Council. An amount above $20 would require voter approval. A $20 annual fee would
generate approximately $300,000 per year. Since rules allowing TBD's were amended in 2005, they
have been created in Bellingham, Burien, Des Moines, Edmonds, Lake Forest Park, Liberty Lake,
Olympia, Point Roberts, Prosser, Sequim, Snoqualmie and University Place.
Although allowed, the City Manager does not recommend using a Transportation Benefit District to
restore General Fund or Street Fund revenues. The proposed 2011-2012 Budget does not rely upon a
TBD to be balanced. Instead, the TBD is offered to the City Council as a tool to address financing
transportation projects that have challenged the Council in the last two biennia. Those project and
service areas include:
• Residential street overlay funding
• Transit services from south end to north end transit center (e.g. "Jitney" project)
• Traffic calming (planning and implementation)
• Implementation of Pedestrian & Bicycle Plan
• Commuter parking/transit oriented development planning
Additional Revenue Options
While not proposed in this biennial Budget, the following revenue tools are available to the City Council
and/or voters:
• "Banked Capacity" – The City Council has the authority to raise property taxes by $156,000
by a vote of the Council. This authority derives from past property tax setting capacity granted
by the state legislature, of which the City opted to take less than the maximum increase.
• Utility Tax – The City currently levies a 6% tax on private utilities, including electricity, natural
gas and telephones, and a 7% tax on cable and garbage utilities. Up until 2010, the City did not
levy a tax on its three public utilities (water, sewer, stormwater). Beginning January 1, 2010, a
1.7% tax was instituted to pay for fire protection related costs, which were previously funded
through water utility rates. A 1% tax on all three City utilities would generate $120,000 per
year.
• Levy Lid Lift – With voter approval, the City could raise property taxes for operations and/or
capital purposes. A 1% increase would generate approximately $100,000.
Utility Rates
The 2011-2012 utility rates discussed below are preliminary estimates.
• Water Rates – In 2003, the City Council approved a new 60 year water supply agreement with
Seattle Public Utilities (SPU). With Seattle’s new rate structure, wholesale rates rose in 2005-2010.
For Mercer Island, SPU rates will remain flat in 2011. SPU sets rates in 3 year periods and has not
yet forecast rates for 2012-2014, but anticipates a large increase (10%-20%) to wholesale water
_________________________________
B-20 City of Mercer Island 2011-2012 Budget
Budget Message
rates in 2012, followed by more moderate increases of about 5% per year. The Utility Board
recommends increasing the annual capital funding level to $1.6 million during the 6 year planning
period, as recommended in the Water System Plan, to fund projected capital reinvestment projects
for mains and hydrants. Staff recommends using debt financing for the First Hill Water
Improvements project ($1.2M) planned for 2012, in order to bring rates below the 12% and 15%
forecast increase for 2011 and 2012. To that end, staff recommends a 9.5% increase for a single
family residential customer, which translates into a $3.51 increase in the average bi-monthly bill (15
ccf bi-monthly usage). The Utility Board will make a recommendation on Water Rates at their
October 12, 2010 meeting.
• Sanitary Sewer Rates – For 2004-2010, the City Council approved significant annual increases in
the “sewer line maintenance” rate in order to fund the repair and replacement of the lake line along
the northwest shore of Mercer Island. This covers the City’s portion of operating and maintaining
the sanitary sewer system and equals about 50% of the total bi-monthly sewer bill paid by the
average single family residential customer. The other 50% is the Sewage Treatment charge
(discussed below). The rate increase is largely driven by the capital reinvestment needs of the
system, after being held to a minimum during construction of the Sewer Lake Line replacement
project. After an initial review of rates based on the 2011-2016 CIP Preview presented to Council
in June 2010, staff recommended adjusting the capital reinvestment plan for 2014 in order to bring
rates below the 9.75% originally forecast for 2011 and to better balance the project workload on
staff. The Utility Board unanimously recommends a 9.3% increase for 2011. This represents a $5.83
increase to the average single family residential customer’s bi-monthly sewer bill, with a winter
water use of 15 ccf per bi-monthly period .
• Sewage Treatment Rates – Sewage Treatment rates charged by King County Wastewater
Treatment, which represents a “pass through” charge, will increase by 13.2% in 2011, which
represents an $8.40 increase in the bi-monthly bill for an average single family residential customer.
• Storm Water Rates – The Utility Board unanimously recommends a 3.3% increase for 2011 and
2012. This translates into an 87 cent increase in the 2011 bi-monthly bill of all single family
residential customers.
• Emergency Medical Service (EMS) Rates – Emergency Medical Service rates are adjusted
annually for inflation based on the Seattle metro area’s CPI-W. City Finance staff recommend a rate
increase of 0.85% for 2011, which corresponds to the First Half 2010 CPI-W. For 2011, rates will
also be adjusted between customer classes based on EMS call history and actual costs of the four
firefighter positions supported by this rate. As a result, an average single family residential
customer’s bi-monthly bill will increase by $2.18 to $5.78 per bi-monthly bill. The Utility Board will
make a recommendation on EMS Rates at their October 12, 2010 meeting.
Taken together, the total (i.e. water, sewer, storm water, and EMS) bi-monthly utility bill for the average
single family residential customer will go up by 9.7% in 2011 and 5.5% in 2012, which equates to a
$20.79 increase and a $12.91 increase respectively, as noted in the table below.
Description 2010 2011 2012
Bi-Monthly Bill $213.42 $234.21 $247.12
Rate Increase over Prior Year 5.8% 9.7% 5.5%
Dollar Increase over Prior Year $11.66 $20.79 $12.91
_________________________________
City of Mercer Island 2011-2012 Budget B-21
Budget Message
Every two years, the Association of Washington Cities conducts a Tax and User Fee Survey. That
survey was completed in 2010. A comparison is presented below of Mercer Island and the average of
the 20 King County cities who responded to the survey. The comparison assumes an average 15 ccf of
water usage per bi-monthly billing period.
Storm
Description Water Sewer TOTAL
Water
Mercer Island $53.84 $63.22 $28.96 $146.02
King County Average $69.21 $53.15 $21.76 $144.12
Note: This does not include the $63.80 charged bi-monthly by King County for Sewage Treatment (all Cities in King County
pay this same amount). It also does not include the $3.60 Emergency Medical Services (EMS) bi-monthly charge, which is
unique to Mercer Island.
See Section F (Utility Funds Summary) for additional detail.
Capital Improvement Program
The 2011-2012 Capital Budget is part of the broader six-year Capital Improvement Program (CIP). The
policy basis for the CIP is explained in detail in Section C (Budget Policies). Actual project details and
financing strategies are also detailed in Section H (Capital Improvement Program). Listed below are the
key issues and initiatives associated with the proposed CIP.
Financing Strategies
The CIP continues to be largely a pay-as-you-go program. Utility rates cover all capital expenditures for
water, sewer, and storm water facilities. Public building, streets, trails, and parks capital maintenance are
supported in whole or in part by real estate excise tax receipts. Major technology system and public
safety equipment costs are funded by General Fund revenues. Finally, fleet and computer replacements
are funded by annual contributions to their respective sinking funds. In addition to REET revenues, the
Street Fund receives revenues from the local portion of the fuel tax.
Real Estate Excise Tax
The Real Estate Excise Tax (REET) is the main revenue source to the Street Fund and the CIP Fund.
REET revenues have been volatile over the last 10 years. During 2003-2007, the City experienced
unprecedented levels of REET revenue due to a boost in the number of home sales amidst a very low
interest rate environment.
In 2008, the nation and region experienced a major contraction in the housing market. As a result, the
number of home sales on Mercer Island dropped from 603 homes in 2004, which represented the peak
sales year, to 260 homes in 2008. Average home sales prices declined from a high of $1.24 million in
2008 to $854,000 a year later. Fortunately, projected home sales and sales prices have improved in
2010 to 300 sales and an average price of $1.0 million. In addition, the City will receive about $500,000
in REET in September 2010 from the sale of Shorewood Heights Apartments. The number of home
sales is forecast to reach 400 by 2012, with home prices expected to increase 5% by 2012. Actual and
forecasted REET revenues for the period of 2001-2012 are shown in the chart below.
_________________________________
B-22 City of Mercer Island 2011-2012 Budget
Budget Message
Real Estate Excise Tax Revenues
$ Millions
$4.00
$3.71
$3.50
$2.93
$3.00
$2.35
$2.50
$2.50 $2.77
$1.82 $1.98
$1.71
$2.00
$1.51 $2.18
$1.50
$1.00
$1.17 $1.26
$0.50
$0.00
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Forecast Budget Budget
Project Management
The City's adopted CIP policy states, “whenever possible, capital projects will be scheduled and
completed in the same year [for which funding is approved]”. In addition, City staff have made it a
consistent practice to show how all CIP projects will account for their project management expenses in
their project budgets. Project management staffing will come from staff or otherwise be outsourced at
skill levels and quantities to design and construct CIP projects in the timeframes approved by the City
Council.
Given the decline in REET revenues and, consequently the number of CIP projects, the 2011-2012
Budget assumes a reduction of 3.5 contract FTE’s: 2 Project Managers, a Records Management
Coordinator, and a half-time CIP Administrative Support position. One Project Manager and the
Administrative Support position (1.5 FTE’s) are currently vacant.
Parks and Open Spaces
No major park improvement projects will be undertaken during the biennium. Instead, efforts will be
focused on minor maintenance improvements in Luther Burbank Park, I-90 Lid Park, Homestead Field,
and Island Crest Park. Other minor improvements will be implemented in smaller neighborhood parks.
Streets, Pedestrian and Bicycle Facilities
The proposed 2011-2012 Transportation Improvement Program includes over $3.3 million in roads,
streets, and pedestrian/bicycle improvements. Among them are the following major projects:
• Arterial Streets – The primary project for the biennium is the re-surfacing of Island Crest
Way (86th SE to SE 53rd). The project is scheduled for design in 2011 and construction in 2012.
The City will also continue its modest arterial street preservation program.
• Residential Streets – Per Council direction, annual residential street overlays will be
undertaken at an accelerated pace in the biennium. The biennial allocation for residential
overlays is $951,000, which represents an increase of $231,000 over the average amount spent
per biennium during the last two biennia.
• Roadside Shoulders – Shoulder improvements along East Mercer Way will continue in 2011
with Phases 7 running from the 5600 block to the 7400 block.
_________________________________
City of Mercer Island 2011-2012 Budget B-23
Budget Message
• Pedestrian and Bicycle Facilities – Pedestrian improvements approved for Island Crest way
and contained in the Pedestrian/Bicycle Plan will be implemented. In addition, the Safe Routes to
School program will continue at $100,000 of funding, and other small PBF Plan projects will be
implemented ($45,000).
Utilities
• Sewer – Shifting efforts from the Sewer Lakeline project, staff will focus on constructing
cleanout access points, main repair and replacement, telemetry improvements, pump station
repairs and emergency generator replacements.
• Storm Water – In 2011-2012, the City will construct improvements for Basin 6 (SE 40th to
Shorewood Apts.) at the estimated cost of $995,000. In addition, the City will undertake design
work for Sub-basins 4.2 and 23.2 and construction of conveyance systems in Sub-basins D15.4
(SE 63rd) and D18c.1 (70th SE). Neighborhood drainage and small-to-medium drainage system
improvements will also be undertaken in the biennium.
• Water – The City will continue with its annual water main upsizing, pressure reducing valve,
meter and hydrant replacement programs. The primary project for the biennium will be
completing the First Hill pressure zone improvements, including upsizing 4" mains and adding
fire flow capacity. In addition, water system improvements along Island Crest Way will be
implemented and coordinated with street overlay construction.
Other Projects
• Fleet Replacements – Fleet replacements will continue according to the vehicle replacement
schedules in the Equipment Rental Fund. Vehicle replacements will be made in accordance with
adopted acquisition and operating standards.
• Public Buildings – The City will make annual repair and maintenance investments in the
following buildings: City Hall, North and South Fire Stations, Maintenance Center, Thrift Shop,
Community Center, and Luther Burbank Administration. Consistent with Council direction,
planned expenditures are based on specific repair and maintenance projects as identified in their
respective CIP project sheets.
• Technology – Nearly all new Information Technology projects have been deferred. Activity in
the biennium will focus on maintaining existing IT systems, including the City’s Financial System,
PC network, server operating system, and database software.
Acknowledgements
Each budget development cycle represents a major planning, analysis and coordination effort by City
staff. The process begins in March and continues through September, concurrently with delivery of all
other public services to the City’s many customers.
Once again, we recognize the dedication and hard work that all staff put into the budget process. In
particular, Finance Director Chip Corder, Deputy Finance Director Francie Lake, and Accounting
Manager LaJuan Tuttle have all demonstrated the expertise and professionalism for which Mercer Island
has become known. Others involved in the writing, proof-reading and production of the budget
document include Ali Spietz, Stephanie Schwenger and James Mason. For all these fine efforts, the City
Manager expresses his sincerest thanks.
_________________________________
B-24 City of Mercer Island 2011-2012 Budget
Budget Message
Postscript
In October, November, and December 2010, the City Council reviewed the Preliminary 2011-2012
Budget proposed by the City Manager. After directing staff to make a number of changes, the City
Council adopted the Final 2011-2012 Budget on December 13, 2010. These changes, along with a few
adjustments made by staff, are summarized in the following two tables: 1) Revenue Adjustments, and 2)
Expenditure Adjustments.
Revenue Adjustments
Description Fund 2011 2012
Revenue Adjustments by Council:
Eliminate 1.0% property tax increase General -$103,165 -$104,197
Equipment Rental -$1,484 -$1,499
Adjust BLS ambulance transport fee (bump up start General $37,500 -$273,750
date to 2/1/11 and sunset on 1/31/12)
Reduce 2011 EMS utility rates to partially mitigate General -$18,700 -$18,700
impact of new BLS ambulance transport fee on EMS
utility rate structure
One-time transfer from 1% for the Arts Fund to General $30,600
General Fund to restore Arts Council programs
Increase sponsorships and donations to restore General $28,453 $28,237
Parks & Recreation Special Events
Use King Conservation District funding to restore General $10,000 $10,000
Tree Planting program
Adjust overall transfer needed from Contingency General -$215,672 $68,661
Fund to re-balance General Fund
One-time transfer from Beautification Fund to Capital $75,000 $75,000
Capital Improvement Fund to increase funding for Improvement
Open Space Vegetation Management project
Reduce transfer from General Fund to Technology Technology & -$25,000 -$25,000
& Equipment Fund for technology CIP projects Equipment
One-time transfer from Capital Improvement Fund Capital Reserve $100,000
to Capital Reserve Fund from reduction in Minor
Park Improvements project (Clarke Beach)
_________________________________
City of Mercer Island 2011-2012 Budget B-25
Budget Message
Description Fund 2011 2012
Revenue Adjustments by Staff:
Adjust 2011 property tax levy for final new General $39,010 $39,401
construction and refund amounts per King County
Assessor’s Office
Increase Mostly Music in the Park sponsorship and General $4,000
donation estimates
Eliminate EOC Incident Management System Technology & -$50,000
Enhancements project and corresponding grant Equipment
funding
Increase funding for Low Impact Development Stormwater $225,000
project per recently awarded Dept of Ecology grant
Expenditure Adjustments
Description Fund 2011 2012
Expenditure Cuts Restored by Council:
Restore human services contracts General $11,500 $11,500
Restore Tree Planting program by using King General $10,000 $10,000
Conservation District funding
Restore Parks & Recreation Arts Council programs General $41,600
Restore Parks & Recreation Special Events by General $28,453 $28,237
increasing sponsorships and donations
Partially restore Parks Maintenance level of service General $60,000 $60,000
($79,000 originally proposed reduction)
One-time transfer from 1% for the Arts Fund to 1% for the Arts $30,600
General Fund to restore Arts Council programs
($41,600 total cost - $11,000 revenue)
_________________________________
B-26 City of Mercer Island 2011-2012 Budget
Budget Message
Description Fund 2011 2012
Additional Expenditure Cuts by Council:
Reduce transfer from General Fund to Technology General -$25,000 -$25,000
& Equipment Fund for technology CIP projects
Eliminate biennial citizen survey General -$20,000
Eliminate Fire Marshal position and redistribute General -$55,000 -$55,000
duties in DSG and Fire Dept
Eliminate interlocal waterfowl management General -$3,000 -$3,090
program
Reduce City Council supplies and contracted General -$2,970 -$2,970
services
Reduce Maintenance Administration other services General -$1,650 -$1,650
and charges
Reduce Non-departmental miscellaneous General -$50,000 -$50,000
professional services
Reduce Non-departmental revenue contingency General -$31,021 -$37,995
Reduce Minor Park Improvements project (Clarke Capital -$100,000
Beach) Improvement
Reduce Luther Burbank Administration Building Capital -$7,000
repairs project Improvement
Adjust overall transfer needed from Contingency Contingency -$215,672 68,661
Fund to re-balance General Fund
Expenditure Enhancements by Council:
Increase funding for Mary Wayte Pool operations Beautification $25,000 $25,000
Increase Open Space Vegetation Management Capital $75,000 $75,000
project budget via transfer from Beautification Fund Improvement
One-time transfer from Capital Improvement Fund Capital $100,000
to Capital Reserve Fund from reduction in Minor Improvement
Park Improvements project (Clarke Beach)
_________________________________
City of Mercer Island 2011-2012 Budget B-27
Budget Message
Description Fund 2011 2012
Expenditure Adjustments by Staff:
Leave vacant Parks Maintenance position unfilled General -$90,352 -$93,744
for 2 years
Beautification -$3,771 -$3,923
Miscellaneous corrections to departmental budgets General -$7,000 $9,776
Restored Eastside Domestic Violence program Criminal Justice $10,000 $10,000
contribution (required by state law)
Eliminate EOC Incident Management System Technology & -$50,000
Enhancements project and corresponding grant Equipment
funding
Increase funding for Low Impact Development Stormwater $225,000
project per recently awarded Dept of Ecology grant
Adjusted budgeted employee health care costs to General -$73,534 -$80,412
actual rates per AWC
Street -$352 -$384
Criminal Justice -$1,914 -$2,096
Beautification -$969 -$1,059
YFS -$7,699 -$8,419
Water -$4,510 -$4,930
Sewer -$3,453 -$3,775
Stormwater -$2,288 -$2,502
Equipment Rental -$528 -$578
Computer -$1,320 -$1,443
Equipment
Finally, where appropriate, beginning fund balance has been adjusted for each fund as well.
Because the General Fund is the primary focal point during the budget review process, a summarized
reconciliation between the Preliminary and the Final 2011-2012 Budget (expenditures only) is provided
on the following page.
_________________________________
B-28 City of Mercer Island 2011-2012 Budget
Budget Message
General Fund Expenditures 2011 Budget 2012 Budget
Preliminary Budget $22,963,098 $23,665,296
Total Expenditure Cuts Restored by Council 151,553 109,737
Total Additional Expenditure Cuts by Council -168,641 -195,705
Total Expenditure Adjustments by Staff -170,886 -164,380
Final Budget $22,775,124 $23,414,948
% Change from Prior Year 8.8% decrease 2.8% increase
Relative to the adopted 2010 Budget of $24.98 million, the Final 2011 Budget for the General Fund is
$2.20 million, or 8.8 percent, less.
_________________________________
City of Mercer Island 2011-2012 Budget B-29
Budget Message
Appendix A
Priorities – Mercer Island City Services
1. The community will be safe.
Make timely and effective responses to crime.
1.1
Make timely and effective responses to fire.
Make timely and effective responses to medical emergencies.
Crime is investigated and prosecuted.
Buildings are safely built.
1.2 The transportation system is safely built and operated.
The City’s drinking water will be safe.
Crime is prevented.
Fires are prevented.
1.3
Mental and physical health problems are prevented.
Emergency responses are planned for.
2. The community will support effective, efficient and legal delivery of public services.
The City Council will have the information and forums necessary for making well-
2.1 considered and informed decisions.
The decisions of the City Council will be implemented.
The City will comply with and enforce all applicable laws and ordinances.
The City will account for its expenditures and revenues and manage its finances
2.2 according to all applicable laws and ordinances.
The City will provide for judicial services.
The City will continually evaluate and improve upon the effectiveness and efficiency of
2.3
its services.
3. The community will support reliable public infrastructure and protect its
considerable public investments (e.g. water, sewer, storm water utilities, streets, parks,
buildings).
The City will operate and maintain its infrastructure to assure continuous, reliable and
safe service.
3.1 The City will repair and replace its infrastructure before it fails.
The City will maintain its infrastructure to prevent failure and extend its useful life.
3.2
_________________________________
B-30 City of Mercer Island 2011-2012 Budget
Budget Message
4. The community will support attractive, high quality neighborhood and business
environments.
Public and private physical features such as streams, shorelines, ponds, forests/trees,
lakes, parks, open spaces, trails and hillsides will be protected.
4.1 Land development regulations are applied and enforced.
Building design regulations are applied and enforced.
Parks, trails and open spaces are provided and maintained.
4.2
Developed public rights of ways will be used and maintained.
5. The community will support a broad range of recreational, cultural, health and
educational opportunities.
5.1
The City will assist its least advantaged citizens with the basic necessities of food,
shelter and health care.
The City will support mental and physical health services for all segments of the
5.2
community.
5.3 The City will support the education of all segments of the community.
The City will provide recreational, cultural and community service programs for
children and teens.
The City will provide recreational, cultural and social service programs for senior
5.4 citizens.
The City will provide recreational, cultural and social service programs for adults.
6. Community will support open and informed public involvement processes within
the structure of representative, democratic decision making.
6.1 The City Council will make decisions on behalf of the community.
The City will generate and disseminate public information to the community on the
issues that confront the community and about the services and programs it provides.
6.2
The City will receive information and opinions from citizens, businesses and other
6.3 interested parties during the course of its policy making and delivery of its services.
_________________________________
City of Mercer Island 2011-2012 Budget B-31
Budget Message
Appendix B
Comparing Mercer Island to Other Eastside Cities
Staffing & General Fund Expenditures
# of Employees in 2010 General Fund Expenditures
Per 1,000 2009 Actual
City Population Rank Per Capita Rank
Redmond 12.4 1 $1,253.55 1
Bellevue 10.7 2 $1,240.51 2
Issaquah1 9.3 3 $1,016.36 5
Bothell 8.9 4 $1,013.10 6
Kirkland 8.8 5 $1,172.41 3
Renton 8.2 6 $1,092.79 4
Mercer Island2 7.8 7 $910.13 7
Notes
1
Issaquah doesn’t have a fire department. Instead, it contracts with Eastside Fire & Rescue
for services.
2
Mercer Island has a Youth & Family Services Department consisting of 17.5 FTE's, which is
unusual among Eastside cities.
_________________________________
B-32 City of Mercer Island 2011-2012 Budget
Section C. Budget Policies
Table of Contents
General Government
Beautification Fund ........................................................................................... C-3
Communications ............................................................................................... C-5
Debt Financing ................................................................................................... C-7
Investment Earnings ......................................................................................... C-9
LEOFF I Retiree Costs .................................................................................... C-11
Long Term Compensation Strategy ............................................................. C-15
Property Tax ...................................................................................................... C-17
Reserves – Capital Reserve Fund ................................................................. C-21
Reserves – Contingency Fund ....................................................................... C-23
Risk Management .............................................................................................. C-27
Sustainability ....................................................................................................... C-29
Utility Funds
Interfund Administrative Charges ................................................................. C-37
Utility Maintenance and Construction......................................................... C-41
Utility Fiscal Policies ......................................................................................... C-43
Capital Improvement Program
Capital Improvement Program ...................................................................... C-49
Street Maintenance and Construction......................................................... C-53
Information Technology .................................................................................. C-55
Vehicle & Equipment Replacement............................................................... C-57
Development Services Group
Development Review Fees ............................................................................. C-63
Transportation Management .......................................................................... C-67
Parks and Recreation
I-90 Landscape Maintenance .......................................................................... C-73
Luther Burbank Park ....................................................................................... C-77
Parks and Recreation Financing ..................................................................... C-81
Trees and Urban Forest Lands ...................................................................... C-85
Public Safety
Criminal Justice Funds ..................................................................................... C-91
Fire Apparatus Replacement .......................................................................... C-93
Fire Prevention .................................................................................................. C-95
Jail Services ......................................................................................................... C-97
Municipal Court ................................................................................................ C-99
Police and Fire Dispatching ............................................................................ C-101
Public Safety Education / Emergency Management ................................... C-103
Youth and Family Services
Youth and Family Services Financing ............................................................ C-107
BUDGET POLICES
General Government
This section includes
budget polices on the
following:
• Beautification Fund
• Communications
• Debt Financing
• Investment Earnings
• Long-Term
Compensation
Strategy
• Property Tax
• Capital Reserve Fund
• Contingency Fund
• Risk Management
• Sustainability
Budget Policies
_________________________________
C-2 City of Mercer Island 2011-2012 Budget
Budget Policies
Beautification Fund
Background
The Beautification Fund was created in 1980 by Council ordinance. According to the ordinance, Business
and Occupation Tax (B&O) revenues are deposited into the Beautification Fund.
The stated purposes of the Beautification Fund are:
• Installation and maintenance of landscaping including plants and other landscaped materials on
public property or easements;
• Acquisition and operation and maintenance of any building, facility, property, or easement for
park, recreation, or open space purposes;
• Undergrounding of power lines and lighting facilities for the operation and maintenance thereof
on public property or easements;
• Promotion and support of a Central Business District (CBD) revitalization program;
• The promotion, support, acquisition, and installation of public art on public property or
easements;
• Acquisition or leasing of parking spaces for Mercer Island residents for the purpose of providing
additional parking;
• Enforcement of parking restrictions, providing signage related to parking, providing permits, and
any other expenses related to parking restrictions; and
• All expenses including, but not limited to, professional fees, printing and publishing, incurred in
connection with the above-listed purposes.
Effective January 1, 2006, the Council simplified the B&O tax structure increasing annual exemptions
from $20,000 to $150,000, establishing a uniform tax rate of .10%, and changing the annual gross
receipts threshold for filing quarterly B&O tax returns from $100,000 to $1,000,000. In addition to
simplifying the tax structure for businesses, this action served to simplify the administrative process for
the City staff.
Historically, expenditures of the Beautification Fund included the operation and maintenance of the
medians and planters in the downtown, the holiday lighting program, support for the Chamber of
Commerce, maintenance of I-90 corridor landscaping, the restricted parking program, business licensing
and business and occupation tax administration, and City support for The Northwest Center’s
operation of the Mary Wayte Pool. Since creation of the Fund, a substantial sum has been spent on
other beautification projects and the broad language of the Code has been construed to permit a variety
of undertakings.
Budget Policies for 2011-2012
• Move CBD utility costs from the General Fund to the Beautification Fund.
• Continue support of ongoing Town Center beautification efforts, including Holiday lighting and
maintenance of medians and planters.
_________________________________
City of Mercer Island 2011-2012 Budget C-3
Budget Policies
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ 69,341 $ 103,057 $ 100,000
Business and Occupation Tax 361,739 325,000 335,000 348,000
Permit Parking Program 2,860 2,550 2,850 2,550
Landscaping Services (WSDOT) 443,812 444,120 447,895 451,000
Interfund Transfer - General Fund 70,000 - - -
Total Budgeted Resources $ 878,411 $ 841,011 $ 888,802 $ 901,550
Not Budgeted
Beginning Fund Balance (Reserved) 658,681 593,891 590,834 495,575
TOTAL RESOURCES $ 1,537,092 $ 1,434,902 $ 1,479,636 $ 1,397,125
USES
Budgeted
Chamber of Commerce $ 14,400 $ 14,400 $ 14,400 $ 14,400
Financial Services \ Parking Program 15,199 12,400 12,800 12,900
Town Center Beautification 139,845 170,000 166,453 166,948
Mary Wayte Pool Operations 100,000 100,000 125,000 125,000
I-90 Landscape Maintenance 521,482 442,171 490,408 497,626
Town Center Plaza 80,462 2,040 - -
Farmers Market Grant 2,472 - - -
Interfund Transfer - CIP - - 75,000 75,000
Total Budgeted Expenditures $ 873,860 $ 741,011 $ 884,061 $ 891,874
Not Budgeted
Ending Fund Balance 663,232 693,891 595,575 505,251
TOTAL USES $ 1,537,092 $ 1,434,902 $ 1,479,636 $ 1,397,125
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C-4 City of Mercer Island 2011-2012 Budget
Budget Policies
Communications
Background
Establishing Communications as a Government Priority
Recognizing the importance of an informed and engaged citizenry to promoting the democratic decision
making process and to achieving the City’s service mission, the City of Mercer Island established public
communication and community involvement as government priority in 2004.
“Community will support open and informed public involvement processes within the structure of
representative, democratic decision making.”
In 2006 the City established public communication and community involvement as a government
priority, developed a plan to coordinate communication and civic engagement efforts and the City
Council authorized the City Manager to add a Communications Coordinator as a new full time position
on City staff.
The Roles and Responsibilities of the Full Time Communications Coordinator
The Communications Coordinator provided full time communications and public involvement
support to City departments from March 2006 to March 2010.
The primary roles and responsibilities of the full-time Communications Coordinator included:
• Serving as the primary media contact for the City of Mercer Island
• Managing targeted communications and outreach strategies for individual City
departments,
• Producing City-wide communications materials
• Overseeing MI-TV broadcast production and programming.
• Managing the City’s public involvement efforts
• Training as a Public Information Officer (PIO) to support the Mercer Island Emergency
Operations Center in the event of a natural disaster or other crisis.
• Assistance with the City’s sustainability efforts.
City Communications Today
The current Communications Coordinator works at 60% time, providing the minimum level of
communications services needed to keep Mercer Islanders informed about the City’s work.
Budget Policies for 2011-2012
Under this model, the Communications Coordinator will continue to work at 60% time, providing only
the essential level of communications services needed to keep Mercer Islanders informed.
The following outlines the proposed overarching goal for City communications in the 2011-2012
biennium under this model:
Get back to basics. Excel at communicating with citizens via the obvious channels, especially through print
media and the website (particularly through the news and events pages calendar). Inform citizens before
things happen and as they happen instead of after they happen. Build collaborative relationships with
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City of Mercer Island 2011-2012 Budget C-5
Budget Policies
individual departments to meet their communications needs and most importantly, the needs of Mercer
Islanders.
Specific functions will include:
• Serving as the primary media contact for the City of Mercer Island.
• Managing targeted communications and outreach strategies for individual City
departments, including the development and implementation of coordinated, relevant
and timely print and web materials.
• Producing City-wide communications materials, including writing, editing, designing
and/or distributing all print and web materials
• Training as a Public Information Officer in order to support the Mercer Island Emergency
Operations Center in the event of a natural disaster or other crisis
• Reviewing and editing all web content prior to posting to help ensure City communications are
accurate, consistent and accessible.
• Coordinating public involvement efforts with individual departments on major policy issues that
affect the community.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures
Salary and Benefits $ 94,829 $ 106,413 $ 59,364 $ 62,312
MI-TV (services & supplies) 17,562 38,200 27,000 27,000
MI Quarterly (printing & postage) 11,083 21,000 11,700 11,700
Other operating costs 4,654 5,547 4,691 4,691
Total Expenditure $ 128,128 $ 171,160 $ 102,755 $ 105,703
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C-6 City of Mercer Island 2011-2012 Budget
Budget Policies
Debt Financing
Background
The City has prudently issued little debt over the years, maintaining a sizable debt capacity and
consistently following a conservative fiscal management policy as reflected in the excellent bond ratings
from Moody's rating service—Aa1 rating for its unlimited tax general obligation (UTGO), or voted,
bonds and a Aa2 rating on its limited tax general obligation (LTGO), or non-voted, bonds. Only four
cities have equivalent or higher UTGO bond ratings according to Moody’s: Seattle (Aaa), Bellevue
(Aaa), Redmond (Aa1), and Kirkland (Aa1). A high bond rating equates to lower interest costs and is
very desirable.
The total amount of debt obligations for cities is limited by state law. Mercer Island has significant legal
capacity for funding foreseeable debt issues. As of 12/31/2009, the available debt capacity margin was
$202,396,480 for general purposes (voted, non-voted and lease debt), $217,767,201 for utility purposes
(voted debt), and $217,767,201 for open space and parks facilities (voted debt).
The City annexed to the King County Library System district (KCLS) in 1994, and as part of the
annexation, KCLS agreed to buy the library from the City for a price equal to the remaining debt service
costs of the 1990 Library bond issue. A lease purchase agreement was signed, resulting in annual lease
payments to the City of $206,576 through December 2009 when the debt was retired.
In 1996, the City refinanced three bond issues to obtain interest savings for the taxpayers. The total
present value savings for these issues amounted to over $548,000.
In 2003, the City issued $2.29 million in Councilmanic bonds to acquire the property on which the
Community Center at Mercerview was sited. This was in preparation for building a new community
center. In 2004, after a year of study and design, the Council authorized the construction of a new
$12.4 million community center. Most of that project was paid with City reserves; however, $2,040,000
in Councilmanic bonds were issued to complete the financing package. Both of these bond issues are
being funded by real estate excise taxes in the Capital Improvement Fund.
In 2007, the City Council authorized two separate contracts with Pierce Manufacturing to purchase the
following through a lease purchase agreement with Municipal Asset Management: 1) two Velocity
pumper fire trucks ($1,035,026), and 2) one mini pumper fire truck ($251,982). The remaining principal
owed for each lease purchase as of December 31, 2010 is $758,561 and $166,336 respectively.
In 2009, the City issued $10.4 million in Councilmanic bonds to finance the remaining balance of the
Sewer Lake Line project ($9.25 million) and to finance improvements to the South Mercer Playfields
($990,000). The debt service on the Sewer Lake Line portion of the bonds is being funded by sewer
utility rates; whereas, the debt service on the South Mercer Playfields portion of the bonds is being
funded by general purpose revenues in the General Fund. By issuing GO bonds instead of revenue
bonds, the City was able to take advantage of its excellent bond rating, reducing the interest rate by
approximately 0.5%. In addition, the City issued a two year GO bond in 2009 to initially fund the
construction of an emergency water supply well. This was an interim financing strategy intended to buy
time for the real estate market to recover. Ultimately, the emergency water well project will be funded
by the sale of a water utility property in the First Hill neighborhood. Given the slow recovery in the
real estate market, the two year GO bond, which had a maturity date of June 1, 2011, was refinanced in
2010, with the due date extended to June 1, 2013.
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City of Mercer Island 2011-2012 Budget C-7
Budget Policies
Budget Policies for 2011-2012
• The City will confine long-term borrowing to fund approved capital improvement projects that
cannot be financed from current revenues.
• The City will use debt financing only when the following conditions exist:
- Object of the expenditure is a major new capital asset.
- Object of the expenditure can be used by residents/taxpayers in the future.
- There are insufficient existing capital revenues available.
- All the revenue is needed at the same time (i.e. the project cannot be phased over time).
• When the City finances capital projects by issuing bonds, it will pay back the bonds within a period
not to exceed the expected useful life of the project.
• The City will not use long-term debt for current operations.
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Voted Debt:
1996 Refunding Bonds $ 199,880 $ - $ - $ -
King County Library Payment (206,576) - - -
Total Amount to be Levied in Taxes $ - $ - $ - $ -
Non-Voted Debt:
2003 Mercerview Property $ 210,061 $ 205,441 $ 200,409 $ 195,170
2004 CCMV Construction 149,760 152,210 149,285 151,135
2009 LTGO Water Well - 23,923 25,430 26,593
2009 LTGO South Mercer Playfields - 95,491 96,336 94,936
2009 LTGO Sewer Lake Line - 677,923 677,113 679,713
2011 LTGO First Hill Water System - - - 92,251
Lease Obligations
2007 Fire Velocity Pumpers 128,023 128,023 128,023 128,023
2007 Fire Mini Pumper 37,721 37,721 37,721 37,721
Total General Obligation Debt $ 525,565 $ 1,320,732 $ 1,314,317 $ 1,405,542
Public Works Trust Fund Loans
Sewer Pump Rehab II $ 17,727 $ 17,727 $ 17,727 $ 17,727
Sewer Lake Line 177,479 408,202 411,353 409,449
Total Public Works Trust Fund $ 195,206 $ 425,928 $ 429,080 $ 427,175
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C-8 City of Mercer Island 2011-2012 Budget
Budget Policies
Investment Earnings
Background
The City pools its cash and invests it in certificates of deposit (CD's) and other investments authorized
by the Revised Code of Washington. To forecast interest earnings, the Finance Department estimates
the average cash balances for all funds as of year-end and then applies a projected rate of return to the
total cash balance.
By pooling and investing its cash, the City is able to obtain the best possible rate of return while still
preserving liquidity. City funds are always fully invested in a combination of timed deposits, money
market accounts, and an interest bearing checking account.
To maximize interest earnings, the City has all of our state revenues wired directly into a City account
with the State Investment Pool. The State Investment Pool has the advantage of paying excellent rates
while being completely liquid. All of the City's funds are currently invested in the State Investment Pool.
Interest earnings are allocated to the City’s funds monthly based on the following prioritized distribution
policy, which took effect on January 1, 2009:
a. Water Utility Fund, Sewer Utility Fund, Storm Water Utility Fund, Firemen’s Pension, and Youth
Services Endowment Fund based on cash balance;
b. $325,000 annually to the General Fund (which is approximately 1.5% of General Fund budget);
c. Fire apparatus replacement reserve, which resides in the Equipment Rental Fund, based on the
difference between the annual sinking fund charge for fire apparatus replacement and the 1.65%
property tax levy dedicated for this same purpose;
d. LEOFF I long-term care reserve, which resides in the General Fund, based on cash balance;
e. Contingency Fund based on cash balance;
f. Street Fund, Capital Improvement Fund, and Technology & Equipment Fund for those CIP
projects that have investment interest as a budgeted revenue source;
g. Any remaining balance would be allocated to the Capital Reserve Fund for unspecified CIP
projects.
The City treasurer's primary objective in investing cash is to preserve the principal of the investment,
while striving to maximize investment returns.
Budget Policies for 2011-2012
• For the 2011-2012 biennium, the following changes are being made to the distribution policy due to
the current historic low rate of return, which is projected to continue for the coming biennium:
- There will be no allocation to the fire apparatus replacement reserve, the LEOFF I retiree long-
term care reserve, or the Contingency Fund as long as the rate of return is under 1%.
- The General Fund annual distribution cap, which was $325,000 for the 2009-2010 biennium,
excluding the LEOFF I long-term care reserve, is being reduced to $150,000.
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City of Mercer Island 2011-2012 Budget C-9
Budget Policies
2011-2012 Budget Impact
2009 2010 2011 2012
Revenues Actual Forecast Budget Budget
General Fund (for general operations) $74,820 $24,600 $25,000 $35,000
LEOFF 1 Reserve (General Fund) 0 0 0 0
Fire Apparatus Replacement Reserve (Equipment
0 0 0 0
Rental Fund)
All Other Funds 168,338 51,056 40,312 33,923
Total Revenues $243,158 $75,656 $65,312 $68,923
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C-10 City of Mercer Island 2011-2012 Budget
Budget Policies
LEOFF I Retiree Costs
Background
Law Enforcement Officers and Fire Fighters (LEOFF) Retirement System membership is made up of all
full-time law enforcement officers and fire fighters in the State of Washington. This retirement system
was initiated in 1970, consolidating the several police pensions systems of First Class cities and the
municipal firemen’s pension systems. As of October 1, 1977, LEOFF was divided into a two-tier system.
All of those employed prior to October 1, 1977, became members of Plan I and those first employed on
or after October 1, 1977, became members of Plan II.
LEOFF Plan I provides the medical benefit of 100% reimbursement of all medically necessary expenses to
each LEOFF Plan I member (members are persons who terminate service with five years or more of
service but do not withdraw their contributions).
LEOFF Plan I membership consists of active and retired members who are relatively young in age. This
young age means the greatest impact of medical costs remains in the future.
LEOFF Plan I Medical Benefit
One of the major distinctions between LEOFF Plan I and Plan II is the LEOFF Plan I medical benefit. This
benefit is set forth as follows:
“Whenever any active member, or any member retired… on account of… sickness… not caused
or brought on by dissipation or abuse, of which the disability board shall be judge, is confined in any
hospital or in home, and whether or not so confined, requires medical services, the employer shall
pay… the necessary medical services not payable from some other source...” [RCW 41.26.150(1)]
In other words, the employer is required to pay all of the reasonable costs for medical services incurred
by active and retired members not paid by insurance obtained by either the employer or someone else.
These costs range from simple visits to a physician to major surgical procedures and placement in a
nursing home. The statutory definition clearly defines the minimum medical services covered. While
the minimum medical services are defined, it is possible that the scope of these enumerated medical
services may be increased by a separate entity known as the Disability Board.
Another important aspect of this medical benefit is the burden of payment. None of the cost is borne
by retirement funds. Moreover, the state is not liable for any cost of this benefit. These costs are the
complete responsibility of the individual LEOFF Plan I employer.
The Disability Board
The pivotal point in the extent of LEOFF Plan I medical cost is the local disability board. This board is
responsible for the determination of duty and non-duty disability and the approval of medical care costs
for LEOFF Plan I members within the jurisdiction.
The Disability Board is made up of two council members, one LEOFF Plan I active or retired police
officer, one LEOFF Plan I active or retired firefighter, and one citizen at large. The Disability Board has
the authority to decide the extent of what will actually be covered beyond the minimum LEOFF Plan I
medical services, as well as whether or not the expense is a reasonable medical necessity. A LEOFF Plan
I member may appeal disability board decisions directly to the state.
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City of Mercer Island 2011-2012 Budget C-11
Budget Policies
Insurance
The provisions of LEOFF Plan I make clear that the employer is expected to utilize insurance to reduce
the financial liability of the risks connected with the medical benefit. The City of Mercer Island insures
the LEOFF Plan I members through the Association of Washington Cities (AWC) Employees Benefits
Trust. The trust has entered into contracts with Regence Blue Shield to provide indemnity health care
coverage and with Group Health Cooperative to provide managed health care coverage. However,
these medical insurance plans do not cover expenses related to long-term care services.
The Association of Washington Cities, through its Employee Benefit Trust offers long-term care
insurance plans underwritten by UNUM Life Insurance Company of America. This Plan is structured to
primarily meet the LEOFF Plan I liability for nursing home and in-home expense. Both in 1996 and in
2002, the City of Mercer Island received quotes directly from UNUM Life Insurance Company of
America to cover the LEOFF Plan I members. In 1996, the annual cost to cover Mercer Island LEOFF
Plan I members was in excess of $64,000 per year and covered approximately 60 percent of the total
long-term care expenses. Additionally, several LEOFF Plan I members were not insurable based on their
health history. In 2002, the annual cost to cover the LEOFF Plan 1 members was in excess of $125,000.
Government entitlement programs don’t offer complete protection either. Medicare was designed to
help older people pay for the same kind of acute care as traditional health insurance, and it provides
only limited post-hospital care. In fact, Medicare pays for less than 5 percent of long-term care costs.
Medicaid, designed for low-income individuals, currently covers about half of the bills for nursing home
residents. But the program has strict eligibility requirements that force middle-income participants to
spend down their personal assets. The vast majority of Mercer Island’s LEOFF Plan I members would be
ineligible for Medicaid benefits.
Mercer Island Disability Board Long Term Care and Nursing Facility
Care Rule
The Disability Board approved long-term care and nursing facility care procedures in October 2002.
These rules require the City to pay for long-term care expenses based upon the average cost of three
(3) nursing facilities or services in the member’s geographic locality for 24 hour-a-day care in a semi-
private room as private pay. The Disability Board Secretary will determine the three (3) nursing
facilities or services that will be used to average the cost.
To date, the City has experienced two (2) long-term care reimbursement claims. In February 2003, the
City paid a total of $58,146 to satisfy its first claim for long-term care expenses. The second claim
amounted to $99,011 paid out in 2004 and 2005.
There are thirty-six (36) remaining City of Mercer Island LEOFF I members. The potential for future
claims for long-term care expenses from a number of Mercer Island LEOFF Plan I members is probable.
Therefore, a source of funding must be considered and established.
Funding Source
The previous actuarial valuation of Long Term Care Benefits for LEOFF I members, completed in 2004,
estimated a $1.1 million target balance to fund the LEOFF I long term care obligation. The most recent
actuarial valuation of the City’s long-term care obligation, calculating the liability as of the year ending
December 2007, estimates that target balance to be $2.07 million. As of December 31, 2010, the City
has accumulated $913,108 toward funding this target balance. The LEOFF 1 members’ retiree medical
insurance premiums and direct medical costs are budgeted separately from regular employee costs.
_________________________________
C-12 City of Mercer Island 2011-2012 Budget
Budget Policies
Budget Policies for 2011-2012
• Schedule another actuarial study in 2011, which is included in the proposed budget. The last one
was completed in 2008. A full pension actuarial valuation is required by GASB (for those cities
preparing Comprehensive Annual Financial Reports) at least every two years and by the State
Auditor’s Office every five years. Finance staff recommends updating the pension, long-term care,
and medical cost valuation every three years.
• Explore ICMA-RC’s Retirement Health Savings (RHS) Employer Investment Program for investing
funds dedicated to LEOFF I long-term care and other medical costs.
2011-2012 Budget Impact
2010 2011 2012
Description 2009 Actual Forecast Budget Budget
Retiree Medical Premiums $ 427,975 $ 493,000 $ 503,300 $ 553,700
Retiree Direct Medial Reimbursements 30,771 25,200 34,570 36,295
Actuarial Study - - 25,000 -
Total General Fund Expenditures $ 458,745 $ 518,200 $ 562,870 $ 589,995
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City of Mercer Island 2011-2012 Budget C-13
Budget Policies
_________________________________
C-14 City of Mercer Island 2011-2012 Budget
Budget Policies
Long-Term Compensation Strategy
Background
This management and budget policy recognizes the significance of the fact that approximately 70% of the
City's operating expenditures are devoted to salary and benefits for employees. The City’s employees
are the means by which basic municipal services and Council policy directives are implemented.
The primary objectives of this compensation strategy are to build both flexibility and predictability into
our human resources systems. Forces such as the regional economy and labor market are outside of
local control. Nevertheless, it is in the City’s best interest to anticipate, when possible, factors that
drive compensation decisions.
This management and budget policy outlines the philosophy and assumptions underlying the City’s
compensation strategy. To implement it, specific actions will be taken during the next two years. These
are listed below in the section titled Budget Policy for 2011-2012.
Compensation Strategy
• For all employee groups, total compensation includes base pay, performance pay, and other
compensation.
• Approved full and part-time positions represent valuable labor potential. Therefore, vacant
positions must be carefully reviewed before they are filled.
• When a healthy economic climate exists, our goal is to remain competitive at approximately the
mid-point of the comparable market. We look at comparable positions in the public (and
sometimes private) employment sectors for our labor market.
• When identifying appropriate comparable cities for conducting market analysis, we choose
organizations based on population (20,000-75,000), Puget Sound location (including King and
Snohomish Counties and excluding Pierce, Thurston, and Kitsap Counties), sales tax per capita
($100-$400), number of employees (150-600), and number of job matches.
• When possible, increases in pay will be tied to exceeding defined performance standards.
• Employees must share in the cost of their health care benefits.
• Compensation decisions (including labor negotiations) will be made using the best data available.
The City’s philosophy strives to create a balance between fair and equitable pay for employees, enabling
management to recognize and reward excellent performance while exercising fiscal prudence by keeping
the City's salary budget within its fiscal ability to pay.
As a general rule, the City’s policy is to make sure that every job is classified and employees are fairly
compensated when compared either internally or externally. It is also the policy of the City to ensure
that salaries do not exceed an amount equal to the 75th percentile of the defined market. An
employee’s salary may be fixed at 5% less than the midpoint of the market to allow for those who may
require extensive on-the-job training to be hired at entry level. In extraordinary circumstances, such as
to attract or retain valued employees, the City Manager has latitude to set salary outside the range.
Competitive Compensation for the Non-Union Workforce
Compensation recognition awards and/or increases may occur for one or more of the following
reasons:
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City of Mercer Island 2011-2012 Budget C-15
Budget Policies
1. Incentive to recognize work quality and/or quantity, either for exceptional performance,
customer service, creating efficiencies, or team performance.
2. The temporary addition of substantial responsibilities (such as temporary assignment or extra
duty).
3. Special achievement.
Salary increases may occur as a condition of satisfactory completion of a probationary period. Starting
salaries are set at an amount that does not exceed the midpoint of the defined market.
Salary adjustments resulting from performance and annual compensation guidelines must be approved by
the Human Resources Director, Finance Director and City Manager.
Performance Awards/Merit Pay
Funds are set aside for performance awards as part of the appropriation made by the City Council for
all non-represented employees. The Human Resources Director, Finance Director and City Manager
will approve performance awards to reward behaviors and performance consistent with the mission of
the department and the City’s vision. Performance awards will follow the guidelines set forth below:
1. The budgeted funding for awards does not exceed 1.5% of the amount of salaries for all non-
represented employees.
2. Performance awards are considered on an annual basis.
Budget Policies for 2011-2012
• Over the next two years, the economic climate requires that we attempt to negotiate collective
bargaining agreements that reduce the fiscal strain on the City’s 2011-2012 and subsequent budgets.
All bargaining groups (Police, Police Support, Fire and AFSCME) will negotiate new or successor
agreements during the 2011-2012 biennium.
• Review each position vacancy for the potential of attrition or work redesign.
• Analyze personnel forecasting, benchmarking and reporting (e.g. indirect pay costs, employee
demographics, tenure, turnover rate, salary spreads, total compensation reports for all employees,
health benefit cost trends).
• Maintain the City’s commitment to high standards of employee performance evaluation by
continuing to track and report employee performance.
• Freeze market based adjustments over the next two years for general employees and represented
employees when possible.
2011-2012 Budget Impact
Collective bargaining ratified by the City Council will determine the budget impact.
_________________________________
C-16 City of Mercer Island 2011-2012 Budget
Budget Policies
Property Tax
Background
There are two types of property taxes collected by the City, levied (regular) and voter approved. The
levied portion may be used for any purpose that the City deems necessary. On Mercer Island, as in most
cities, the property tax levy supports the General Fund, which funds most of the general operations of
the City. Voter approved taxes are for specific purposes, such as the purchase of parks. These taxes
have been specifically identified in an ordinance and voted on by the residents.
The total property tax bill that a resident pays consists of not only the city levied and voter approved
portions but also the property taxes that other jurisdictions levy on the residents. The Mercer Island
portion of the property tax bill has decreased gradually as a percentage of the tax bill from 17.1% of the
total property tax bill in 2001 to 15.4% in 2010.
There are 9 jurisdictions that have taxing authority on Mercer Island. The largest two are taxes in
support of schools – amounting to 54.3% of the tax bill. In 2010, the State School Fund’s and the
Mercer Island School District’s collections amounted to 28.5% and 25.8% respectively. King County is
the next largest taxing jurisdiction, receiving 16.5% of the property tax bill. The King County Library
District, the Emergency Medical Services Levy, the Port of Seattle, and the Flood Zone and Ferry
Districts receive the remainder of the taxes, which collectively amount to 13.8% of the property tax bill.
Below is a table of the taxing jurisdictions and the percentage of each tax dollar that they received in
each year for the period 2001-2010.
Taxing Jurisdiction 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
State School Fund 32.9% 33.8% 32.5% 31.3% 31.2% 30.7% 30.9% 29.8% 28.6% 28.5%
MI School District 24.1% 23.6% 25.9% 24.9% 24.6% 24.8% 23.1% 22.1% 26.3% 25.8%
King County 17.1% 16.4% 15.1% 16.2% 16.1% 16.3% 17.2% 16.9% 15.9% 16.5%
City of Mercer Island 17.1% 16.0% 15.3% 16.4% 16.8% 16.6% 16.7% 15.9% 14.6% 15.4%
King County Library 5.0% 5.1% 5.6% 5.6% 5.6% 6.0% 6.2% 5.8% 5.7% 5.9%
EMS (emergency svcs) 2.6% 2.8% 2.7% 2.7% 2.7% 2.7% 2.8% 4.2% 2.9% 3.8%
Port of Seattle 2.0% 2.1% 2.9% 2.9% 2.9% 2.9% 3.1% 3.1% 4.0% 2.8%
Flood Zone 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 1.4% 1.3% 1.3%
Ferry District 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.8% 0.7% 0.0%
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Below is a breakdown of the 2010 levy rates and the corresponding dollar amounts due to each taxing
jurisdiction based on a $1.0 million Mercer Island home.
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City of Mercer Island 2011-2012 Budget C-17
Budget Policies
Taxing 2010 Levy 2010 Levy % of Total
Jurisdiction Rate Amount in 2010
State School Fund $2.22253 $2,223 28.5%
MI School District $2.01025 $2,010 25.8%
King County $1.28499 $1,285 16.5%
City of Mercer Island $1.20135 $1,201 15.4%
King County Library $.46088 $461 5.9%
EMS (emergency services) $.30000 $300 3.8%
Port of Seattle $.21597 $216 2.8%
Flood Zone $.10514 $105 1.3%
Ferry District $.00348 $3 0.0%
Total $7.80459 $7,805 100.0%
Regular Levy and Referendums
Each November, as required by Washington State law, the City Council sets the property tax levy for
the coming year. Up until November 1997, this levy was restricted to a maximum of 106% of the
previous year's levy plus the full levy authority for new construction. However, in 1997, the
Washington State Legislature passed Referendum 47 on to the voters of the state who in turn approved
it by a 60% majority. This referendum set a limit on property tax increases to be the lesser of 106% or
the rate of inflation, whichever was less. In 2001, Initiative 747 passed in the State which further changed
the property tax law. Initiative 747 limits the property tax levy to a maximum of 101% of the previous
year’s levy, or the rate of inflation, whichever is less. Since the rate of inflation is normally above 1%,
the effective limit for property tax will normally be 1%. The initiative also allows higher property tax
increases if approved by the voters, a provision that was already in the statutes. The initiative’s
sponsors intended for voters to have a say in the size of tax increases.
Inflation, for the purposes of the referendum, is defined as the increase in the Implicit Price Deflator
(IPD) for the previous 12 months ending in July of each year by the Bureau of Economic Analysis. This is
not the same thing as the Consumer Price Index (CPI), which most cities, including Mercer Island, have
used for many years as the measure of inflation to increase employee wages. The wage contracts
specify the CPI to be used as the wage adjuster. The two indexes, IPD and CPI, track different items.
During 2006, I-747 was declared unconstitutional by a King County Superior Court judge. Attorney
General Rob McKenna appealed the ruling to the Washington State Supreme Court. Ultimately, the
Supreme Court upheld the ruling of the lower court. Then, in 2007, the state legislature re-instated I-
747, making it law.
Levy Policy
For many years, the Council policy was to raise the levy by the full amount allowed by law. However,
beginning in the 1995-1996 Budget, the City Council chose to provide property tax relief to Mercer
Island residents by “ramping down” the annual increase allowed by law, with the intent of targeting the
rate of inflation. Considering that the CPI for the Seattle metro area is used in the City’s labor
contracts and that the cost of salaries in the General Fund account for 52% of the General Fund budget,
the CPI is the most relevant measure of inflation. In addition, almost every city in the Puget Sound
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C-18 City of Mercer Island 2011-2012 Budget
Budget Policies
region uses the CPI in its labor contracts. The Council reached its “inflation” goal in 1999. Since 2001,
the Council has normally followed the State law and increased taxes by 1%. However, in 2002, 2005,
2006, and 2007, the Council decreased property taxes by paying for some voted debt out of reserves.
For the 2010 levy, the Council opted for a 0% increase due a negative IPD.
The current Council policy concerning the property tax levy stresses flexibility. The Council is
committed to fiscal responsibility as well as keeping this community affordable for its citizens. Thus,
each year, the Council reviews the regular property tax levy in light of:
• Current economic conditions;
• The fiscal health of the City (focusing on the City's largest revenue sources and personnel
costs); and
• The six year financial forecast for the General Fund.
Property Tax Factors
The General Fund has always relied heavily on the property tax, which accounts for 42% of General
Fund budgeted revenues in 2010. Because Mercer Island is primarily a residential community with
modest business growth to support the City revenue base, the property tax is the most stable,
predictable, and largest of all City revenues. Mercer Island is unlike other Eastside cities that are
supported heavily by sales taxes. For example, in Redmond, Kirkland, and Bellevue, property tax
comprises less than 20% of the total revenue base.
Effect of Increases on Taxpayers and City
One of the questions that must be considered in any discussion of the property tax is the effect on both
the taxpayer and the City with a 1% tax increase. For example, a 1% increase in the City’s 2011
property tax levy, if approved, would generate $104,650 in total new revenue for the City, which
corresponds to a $12.00 annual increase on a $1.0 million home.
Regular Property Tax Annual Amount
Under normal circumstances, the City will plan to take the full 1% property tax increase to preserve the
financial well-being of the City and to protect the property tax base for the future. Given that the long-
term annual rate of inflation is 3.0-3.5% and that employee salaries and benefits (which make up 70% of
the General Fund budget) typically increase 5.0-6.0% annually, excluding the current recession, this
means that the City will become increasingly more reliant on other revenues—namely, sales tax, utility
tax, and charges for services—to make up the difference. If the cost of services can be financed without
an increase in property taxes, the Council will consider forestalling the annual 1% increase allowed
under state law.
Banked Capacity
The banked capacity provision allowed under RCW 84.55.092, Protection of Future Levy Capacity,
allows local taxing districts to calculate levies based on the maximum lawful levy since 1985. If a taxing
district voluntarily levies less than its maximum levy amount in a prior year, it will have some banked
capacity that it could use in the future. The King County Assessors Office keeps track of the banked
capacity for each jurisdiction. In 2008, the Council opted to use 0.65% banked capacity (or $57,900), in
addition to the 1% optional increase, to help fund the fire apparatus replacement reserve on an ongoing
basis. As of December 2010, Mercer Island’s banked capacity equals about $156,000.
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City of Mercer Island 2011-2012 Budget C-19
Budget Policies
Voted Tax Increases for Maintenance and Operations
The Council will determine an appropriate level of service for the Island as part of the budget process.
The choice remains to balance the budget by raising taxes and/or increasing fees, by cutting services, or
both. If the cost of the services cannot be supported by the forecasted revenues with a 1% tax increase,
the Council may consider authorizing a ballot measure for a voter approved levy lid lift.
On November 4, 2008, Mercer Island voters approved a $900,000 Parks Maintenance and Operations
levy lid lift (for 15 years) but rejected the companion $12.0 million Parks Bond measure. As a result, the
City Council opted to levy only $772,000 of the $900,000 lid lift in 2009, backing out $128,000 in
maintenance and operations costs related to the parks capital projects in the bond measure that failed.
To avoid double collecting on two levy lid lifts with overlapping purposes, the City Council decided to
levy only $110,000 of the $499,349 allowable in 2009 for small capital projects under the Luther
Burbank Park lid lift, which ended on December 31, 2009. In 2010, the Council levied the same amount
that was levied in total in 2009 (i.e. $882,000).
King County Parks Levy
A portion of this six year levy, which voters passed in 2007, is remitted to each city in King County for
purposes of protecting and preserving open space and acquiring and developing regional trails. Mercer
Island has dedicated this funding source to trail development in its Capital Improvement Program.
Budget Policies for 2011-2012
• Each year, the regular property tax levy is reviewed by the City Council to determine the
appropriate level of funding given current economic conditions, the fiscal health of the City, and the
six-year financial forecast for the General Fund. Due to the projected General Fund revenue
shortfall in 2011-2012, the City Manager’s Preliminary 2011-2012 Budget included a 1% optional
increase for 2011 and 2012. On December 6, 2010, the City Council opted to not take the 1%
optional increase in 2011. Taken together, new construction and the refund levy, which aren’t
subject to the 1% limitation, amount to $99,011 in 2011 and are estimated to be $100,000 in 2012.
• The 2008 Parks Maintenance and Operations levy lid lift included a 1% optional increase for 2011
and 2012 in the City Manager’s Preliminary 2011-2012 Budget. As noted above, the Council opted
to not take the 1% optional increase in 2011. As a result, the budgeted levy lid lift amount in 2011
and 2012 is $882,000 (same as 2010 levy) and $890,820 ($882,000 + 1%) respectively.
• There is no excess levy (i.e. voter approved debt) in 2011-2012.
• The City anticipates receiving $72,500 in 2011 and 2012 from the 2007 King County Parks levy.
2011-2012 Budget Impact
2009 2010 2011 2012
Revenues Actual Forecast Budget Budget
City’s Regular Levy (general purpose) $9,199,225 $9,434,568 $9,533,579 $9,728,915
City’s Regular Levy (fire truck replacement) 148,446 148,446 148,446 149,930
2003 Luther Burbank M&O Levy Lid Lift 110,000 0 0 0
2008 Parks M&O Levy Lid Lift 760,163 882,000 882,000 890,820
Total Levied by City $10,217,834 $10,465,014 $10,564,025 $10,769,665
2007 King County Parks Levy $82,202 $72,500 $72,500 $72,500
Total Revenues to City $10,300,036 $10,537,514 $10,636,525 $10,842,165
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C-20 City of Mercer Island 2011-2012 Budget
Budget Policies
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City of Mercer Island 2011-2012 Budget C-21
Budget Policies
Reserves – Capital Reserve Fund
Background
As part of the overall capital budget, the City’s Capital Facilities Plan (CFP) is a six-year plan to outline
proposed new capital projects. The CFP is divided into four component parts:
• Streets, including pedestrian and bicycle facilities;
• Parks, recreation, and open space;
• General government, including public buildings; and
• Utilities, including water, sewer and storm water.
As required by State law and our own City policies, the CFP serves the capital planning requirements for
six-year plans as outlined in the Comprehensive Plan and State Growth Management Act.
According to another budget policy for the Capital Improvement Program, funding for the CFP portion
of the capital budget will generally be decided simultaneously with the approval of the project. As
opposed to the Capital Reinvestment Plan, which is financed on a “pay-as-you-go” basis out of existing
revenue sources, the projects in the CFP have been financed through a bond issue, special grant, or a
source of revenue that is outside the cash resources of the City.
During past years, better than forecasted sales tax revenues have allowed the Council to establish a
Capital Reserve Fund where such revenues have been held for future projects and as a contingency
reserve to stabilize real estate excise tax receipts, if needed, or to cover unanticipated project cost
increases. This policy has allowed the Council to take advantage of the benefits of robust economic
times and over time accumulate funds for these purposes.
Budget Policies for 2011-2012
• Maintain a Capital Reserve Fund to accumulate funds to finance eligible capital facilities projects
consistent with the City’s overall Capital Improvement Plan. Such projects would include
construction of new public buildings, major reconstruction of a public building or park, or acquisition
of a new open space or park.
• Per the Council’s direction, $100,000 will be transferred from the Capital Improvement Fund to the
Capital Reserve Fund in 2011. This was made possible by the Council’s decision to reduce the
proposed 2011 budget for the Minor Park Improvements project from $108,000 to $8,000.
• The Council will have the opportunity to build the balance in the Capital Reserve Fund as part of the
annual process for determining the disposition of the year-end surplus, if any, in the General Fund
and the Capital Improvement Fund.
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City of Mercer Island 2011-2012 Budget C-21
Budget Policies
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ - $ 1,035,000 $ - $ -
Interfund Transfer - - 100,000 -
Total Budgeted Resources $ - $ 1,035,000 $ 100,000 $ -
Not Budgeted
Beginning Fund Balance (Reserved) 1,579,380 34,999 34,999 134,999
TOTAL RESOURCES $ 1,579,380 $ 1,069,999 $ 134,999 $ 134,999
USES
Budgeted
I-90 Lobbyist $ - $ 35,000 $ - $ -
Boys & Girls Club - 1,000,000 - -
Interfund Transfer 509,381 - - -
Total Budgeted Expenditures $ 509,381 $ 1,035,000 $ - $ -
Not Budgeted
Ending Fund Balance 1,069,999 34,999 134,999 134,999
TOTAL USES $ 1,579,380 $ 1,069,999 $ 134,999 $ 134,999
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C-22 City of Mercer Island 2011-2012 Budget
Budget Policies
Reserves – Contingency Fund
Background
The Contingency Fund, which serves as the City’s “Rainy Day” reserve, was established to:
• Address an unanticipated, significant revenue shortfall in the General Fund or another general
government operating fund on a temporary basis;
• Provide temporary funding for an unanticipated, non-recurring, significant expenditure that
cannot be absorbed within the General Fund or another general government operating fund;
and
• Provide temporary funding for an unanticipated, ongoing, significant increase in general
governmental operating costs that cannot be absorbed within the General Fund or another
general government operating fund.
According to Washington State law, the fund balance in the Contingency Fund is limited to 37.5 cents
per $1,000 assessed valuation. For 2011, the legal limit is $3,183,106. The funding goal is to maintain a
target balance of 10% of budgeted expenditures in the General Fund, which corresponds to $2,277,512
based on an authorized 2011 expenditure budget of $22,775,124. As of 12/31/10, the Contingency Fund
is projected to have a balance of $2,094,334, which equals 92% of the 2011 target balance.
In addition, there is a revenue stabilization reserve of $300,000 in the General Fund, which is intended
to address an unanticipated, significant revenue shortfall in the General Fund (most likely related to sales
tax) on a short-term (i.e. less than 1 year), temporary basis. The revenue stabilization reserve is an
extension of the Contingency Fund, representing a “first line of defense” against a revenue shortfall. In
2009, $285,000 was used to bridge the revenue shortfall in the General Fund. In 2010, the remaining
$15,000 was used for the same purpose.
In the past, the Contingency Fund has received revenues from two sources:
1. Interest earnings based on the cash balance in the fund; and
2. General Fund surplus from the prior year, which can be used to increase the Contingency Fund
balance to the specified target level.
Recognizing that a number of different financial scenarios requiring the use of the Contingency Fund are
possible, the following guidance is provided regarding when to tap the Contingency Fund and when to
replenish it.
Use Guidance: Revenue Shortfall
1. When total revenues in the General Fund or another general government operating fund are
projected to be at least 3% below budget, the Finance Director and City Manager will prepare a 12-
24 month “Rainy Day” strategy utilizing the following prioritized funding sources:
a) Prior year’s revenue surplus and/or expenditure savings in the General Fund, which haven’t been
committed to a specific purpose or distributed yet;
b) Expenditure savings in the current and coming fiscal years, including temporary employee layoffs
but excluding regular employee layoffs (General Fund target: 3.0% of budgeted expenditures for
a 12-24 month period); and
c) Revenue stabilization reserve in the General Fund ($300,000).
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City of Mercer Island 2011-2012 Budget C-23
Budget Policies
d) Contingency Fund and/or temporary/regular employee layoffs, recognizing that the latter will be
recommended when:
− The balance in the Contingency Fund is projected to last less than 24 months; or
− A significant portion of the revenue shortfall is deemed to be ongoing.
2. The Finance Director and City Manager will present their 12-24 month “Rainy Day” strategy to the
Council and will seek an appropriation of all or a portion of the prior year’s revenue surplus and/or
expenditure savings in the General Fund, which haven’t been committed to a specific purpose or
distributed yet.
3. When it becomes evident that funding sources “a” and “b” are inadequate to address the projected
revenue shortfall, the Finance Director and City Manager will seek Council approval to use the
$300,000 revenue stabilization reserve in the General Fund.
4. When it becomes evident that funding sources “a,” “b,” and “c” are inadequate to address the
projected revenue shortfall, the Finance Director and City Manager will amend their 12-24 month
“Rainy Day” strategy, as deemed appropriate, and present options and make a recommendation to
the Council regarding how much of the Contingency Fund to appropriate and the timing and
number of temporary/regular employee layoffs.
Use Guidance: Unanticipated Expenditure or Operating Cost Increase
To address an unanticipated, non-recurring expenditure or an unanticipated, ongoing increase in general
governmental operating costs that cannot be absorbed within the General Fund or another general
government operating fund, the Finance Director and City Manager will seek an appropriation from one
or both of the following prioritized funding sources:
a) Prior year’s revenue surplus and/or expenditure savings in the General Fund, which haven’t been
committed or distributed yet; and
b) Contingency Fund.
Replenishment Guidance
The funding source for replenishing the revenue stabilization reserve (in the General Fund) and the
Contingency Fund is the prior year’s revenue surplus and/or expenditure savings. Restoring the revenue
stabilization reserve and the Contingency Fund to their target levels will constitute the Council’s highest
funding priority following the final draw needed to address a revenue shortfall or an unanticipated
expenditure, absent a super majority vote (i.e. 5 vs. 2) to the contrary:
• For a revenue shortfall, the replenishment target period is 3 years.
• For an unanticipated, non-recurring expenditure or an unanticipated, ongoing increase in general
governmental operating costs, the replenishment target period is 2 years.
Budget Policies for 2011-2012
• Due to the current historic low rate of return, which is projected to continue for the coming
biennium, there will be no distribution of investment earnings to Contingency Fund as long as the
rate of return is under 1%.
• The Finance Director recommends using no more than 50% of the 12/31/09 Contingency Fund
balance to address the revenue shortfall projected through 2012, thereby leaving $1,172,167 to
address any unanticipated, significant expenditures.
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C-24 City of Mercer Island 2011-2012 Budget
Budget Policies
• To address the projected 2011 and 2012 revenue shortfalls in the General Fund, $545,989 is
budgeted to be transferred to the General Fund. This will leave an estimated balance of $1,548,346
in the Contingency Fund at the end of 2012, which equals 68% of the 2011 target balance.
• The Sewer Lake Line project, which received $1.8 million in prior year General Fund revenue
surplus funding, is projected to be closed out at the end of 2011 under budget by $1.20 million.
Staff will be recommending that the Council replenish the $300,000 revenue stabilization reserve (in
the General Fund) used in 2009-2010 and the Contingency Fund balance used in 2010 (which was
budgeted at $478,522, but only $250,000 is estimated to be needed). Otherwise, the City won’t be
able to replenish the used balance until revenue surpluses are generated again in the General Fund.
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ - $ 478,522 $ 130,828 $ 415,161
Interfund Transfers - General Fund 176,500
Total Budgeted Resources $ 176,500 $ 478,522 $ 130,828 $ 415,161
Not Budgeted
Beginning Fund Balance (Reserved) 2,167,835 1,865,813 1,734,985 1,319,824
TOTAL RESOURCES $ 2,344,335 $ 2,344,335 $ 1,865,813 $ 1,734,985
USES
Budgeted
Interfund Transfers - General Fund $ - $ 477,038 $ 130,828 $ 415,161
Interfund Transfers - Fleet Fund - 1,484 - -
Total Budgeted Expenditures $ - $ 478,522 $ 130,828 $ 415,161
Not Budgeted
Ending Fund Balance 2,344,335 1,865,813 1,734,985 1,319,824
TOTAL USES $ 2,344,335 $ 2,344,335 $ 1,865,813 $ 1,734,985
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City of Mercer Island 2011-2012 Budget C-25
Budget Policies
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C-26 City of Mercer Island 2011-2012 Budget
Budget Policies
Risk Management
Background
Mercer Island is one of the charter members of the municipal self-insured liability pool—Washington
Cities Insurance Authority (WCIA). Through WCIA and an interlocal agreement with approximately 80
other cities, the City of Mercer Island insures general liability, automobile liability, errors and omissions,
police enforcement, employee administration, and advertising liability.
Each member city is insured for $1.0 million per occurrence with no deductible and no limit in number
of claims. Each city also is covered by an additional $4 million per year for large claims. Participation in
WCIA's program has resulted in the City continuing to be covered on a per occurrence basis with tail
coverage back through 1981. The pool presently is self-insured and uses an annual actuarial study to
determine member "premiums" and reserve policies.
WCIA's long-term goals are to provide prudent planning and effective management to allow member
cities liability protection comparable to or better than that available in the private market. Loss control
procedures are reviewed with the cities to assist members to more effectively prevent, control, or
subrogate liability risks.
Other Insurance
The City purchases property insurance through a pooled arrangement with the other member cities of
WCIA. The City continues to retain the first $5,000 of property loss through its Self-Insurance Fund,
which maintains a balance of at least $100,000 to cover non-deductible losses.
Industrial insurance is provided by the state with premiums paid based on the number of hours worked.
The City's workforce is divided into four classes with different rates for each class. Volunteers are also
covered by industrial insurance.
Budget Policies for 2011-2012
• Continue to participate in the Washington Cities Insurance Authority during the 2011-2012
biennium.
• Continue to review opportunities for efficiencies and reductions in risk-based insurance costs.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures Actual Forecast Budget Budget
Liability Insurance-WCIA $516,446 $567,868 $ 688,324 $743,390
Carrier Property 88,608 91,100 92,997 94,857
Specialty Insurance 5,355 5,775 5,953 6,072
Total Expenditures $610,409 $664,743 $787,274 $844,319
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City of Mercer Island 2011-2012 Budget C-27
Budget Policies
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C-28 City of Mercer Island 2011-2012 Budget
Budget Policies
Sustainability
Background
The 2011-2012 Budget reflects the Mercer Island City Council’s commitment to building a sustainable
community. This commitment is evident in the budget of each individual department, the capital
improvement program, and in the funding priorities of the City’s three utilities.
Sustainability is a Mercer Island value. It is a process of ensuring the wise use and management of all
resources within a framework in which environmental, social, cultural and economic well being are
integrated and balanced. It means meeting the needs of today without adversely impacting the needs of
future generations.
The first cornerstone of the City’s sustainability policy foundation was created in 2006 with the
adoption of a Comprehensive Plan amendment that expanded the City’s Vision Statement to include the
following statement:
“Mercer Island strives to be a sustainable community: Meeting the needs of the present while
preserving the ability of future generations to meet their own needs. We consider the relationship
between the decisions we make as a community and their long-term impacts before committing to
them. We understand that our strength is dependent on an open decision-making process that takes
into account the economic, environmental and social well-being of our community.”
Accountability
The City of Mercer Island will work to:
• Optimize the efficient use of resources and minimize waste;
• Increase the use of renewable resources and reduce greenhouse gas emissions;
• Operate in ways that minimize any adverse impacts on the environment or the local community;
• Require employees to incorporate informed sustainability perspectives within their work;
• Encourage contractors, vendors and other community partners working within our community
to adopt sustainable best practices; and
• Deliver an improved quality of life for the current and future residents of Mercer Island.
Service Delivery
City departments will:
• Implement sustainable procurement procedures taking account of whole of life costs;
• Repair, reuse and recycle ahead of the responsible disposal of surplus materials, and minimize
waste generation while taking into account the economics of the work;
• Take positive actions promoting continual improvement in sustainability performance;
• Set and achieve clearly defined sustainable development objectives and targets;
• Recognize, celebrate and reward achievement in order to promote the city as a sustainable
organization; and
• Develop the capacity of staff to promote the principles and practice of sustainability.
In 2006, the City Council adopted a budget policy that directed the City’s staff to “undertake efforts to
curtail its consumption of scarce resources including electric energy, water, fossil fuels and land fill
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City of Mercer Island 2011-2012 Budget C-29
Budget Policies
space” and set new targets for the conservation of natural resources. The Council has been clear that
the most cost-effective efforts should come first and that the effectiveness of sustainability efforts should
be evaluated by their measurable impact on the carbon footprint of the Island.
The City Council’s Sustainability Work Program identifies several priorities areas that should be
addressed to meet the City’s overarching goal of reducing greenhouse gas emissions by 80% from 2007
levels by 2050. In early 2007, Governor Christine Gregoire signed Executive Order 07-02 and
established a similar statewide goal.
In the 2009-2010 biennium Council directed staff to pursue any federal, state, local or private grant
opportunities to help promote sustainable activities that will ensure long term economic, environmental
and social sustainability.
Grants
Over the past 18 months, staff has been awarded two sustainability grants funded through Federal
Stimulus resources which will be managed and implemented through 2012: 1) the Energy Efficiency
through Community Building grant (from the Federal Department of Energy and the Washington
Department of Commerce), and 2) the Clean Cities Grant (from the Department of Energy and the
Puget Sound Clean Air Agency). Both of these grants will help to fund sustainable city programs,
projects and equipment. Examples of grant funded projects include:
• CCMV gym lighting retrofit
• Development Services Department Green Building Tool Kit
• Community Partnership with PSE and Green Ribbon Commission to encourage energy efficiency
in residential household energy consumption
• Electric Bicycles and Hybrid Vehicles for the Police Department
• Electric utility vehicles for parks maintenance
• Electric vehicle charging stations at several community sites
The City continues to pursue local, regional, state and federal grants that will provide opportunities to
support our sustainability efforts.
Fleet
Serious commitment to address global warming in the Puget Sound region must powerfully address
emissions from the transportation sector, which represents approximately 50 percent of all regional
greenhouse gas emissions. Public fleets in particular have a responsibility to take the lead, especially
those operating in cities and counties that have formally pledged or adopted resolutions to achieve
significant greenhouse gas reductions.
With this goal in mind, the City of Mercer Island, in partnership with numerous other local governments
in our region, the Puget Sound Clean Air Agency, and the Puget Sound Clean Cities Coalition launched
the Evergreen Fleets Initiative, an effort to engage public fleets in voluntary actions to reduce vehicle
emissions.
An Evergreen Fleets Advisory Committee identified the attributes that define a “green fleet” and
recommended a suite of policies and criteria that can be used to standardize these attributes and help
fleets achieve more environmentally friendly operations. Evergreen Fleets has developed a voluntary
program that is conceptually similar to the Leadership in Energy and Environmental Design (LEED)
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C-30 City of Mercer Island 2011-2012 Budget
Budget Policies
standard for green buildings, requiring fleets to meet different levels of environmental performance to
become certified as a green – or Evergreen – fleet.
In 2009, the City achieved a one star certification through Evergreen Fleets and was one of the first four
fleets in the region to complete the certification process successfully. The City is committed to
completing annual reporting that evaluates pollutant emissions and implements increasingly effective
reduction strategies. The ultimate goal is to reduce air pollution in the region by meeting or exceeding
Evergreen Fleets performance standards.
Healthy Neighborhoods
The City of Mercer Island works to promote development that reduces environmental impacts by
following green building principles, using natural resources efficiently, and preserving the natural beauty
of Mercer Island. We will also take into account opportunities that will provide affordable development
within easy access of public transportation and regional amenities that decrease the need for
automobiles and encourage bicycling and walking.
Water Quality
The protection of Lake Washington has long been one of the City’s top priorities. The creation of the
City’s Stormwater Utility in the mid-1990s provided stable funding to effectively manage the Island’s
impact on the Lake.
Conserving Resources and Reducing Carbon Emissions
The wise use of resources, from electricity and natural gas to drinking water and urban forests, is a
fundamental requirement for creating sustainable communities. The City has a long history of effectively
promoting resource conservation, waste reduction and recycling, purchasing products made with
recycled content, and using alternatives to pesticides and other harmful chemicals. These efforts will
intensify and extend throughout City operations in the coming years. Partnerships continue to be
established with like-minded agencies for added motivation and mutual support.
Green Power
Moving toward cleaner and more reliable energy is a critical of part of the formula for slowing global
warming. Even at the local government level, it is possible to make significant and meaningful
contributions. The City is taking advantage of the regional momentum to develop an electric vehicle
infrastructure. Through the use of Federal and State grant opportunities as well as regional partnerships
the city is securing the resources to site electric vehicle charging stations in the community.
Budget Policies for 2011-2012
Grants
• Continue to collect and report baseline and annual data required by Federal grant criteria.
• Continue to develop partnerships that will be a catalyst to the success of future grant applications.
• Continue to seek out grant opportunities that will develop sustainable projects and programs that
will add value to our community, will enhance our service delivery and will not add long term fiscal
demands through maintenance and operation.
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City of Mercer Island 2011-2012 Budget C-31
Budget Policies
Fleet
• Collect and report baseline and annual fuel use data and fleet utilization data (miles or hours).
• Implement policies and procedures in the City’s Evergreen Fleet Work Plan.
• Continue acquiring hybrid and electric vehicles when they pass the test for cost effectiveness.
• Periodically evaluate opportunities for conversion to alternative fuels.
• Evaluate and acquire new efficiency technology such as idle shutdown timers when it passes the test
for cost-effectiveness.
Healthy Neighborhoods
• Develop a green building tool kit in the Development Services Department that addresses policies,
process and procedures that encourages customers to seek green building techniques and provides
guidance.
• Continue to work with regional transportation authorities—Washington Department of
Transportation, King County metro and Sound Transit—to develop well integrated, multimodal
transportation options for our community.
• Continue to enforce land use codes that reduce sprawl by encouraging new housing in the Town
Center and by creating a compact, walkable neighborhood in the Town Center.
• Promote non-motorized transportation options through the implementation of the City’s updated
Bicycle and Pedestrian Facilities Plan.
• Collaborate with A regional Coalition for Housing to develop affordable housing within Mercer
Island’s Town Center.
• Collaborate with Island residents and organizations to raise the community’s awareness about the
importance of employing sustainable practices, including reducing greenhouse gas emissions and the
relationship to global warming.
• Continue to support the Green Ribbon Commission efforts to motivate Mercer Island residents to
engage in sustainable practices.
Water Quality
• Continue to meet the requirements of the new federal stormwater regulations contained in the
National Pollutant Discharge Elimination System (NPDES).
• Work with state and federal regulatory agencies to minimize the impact of capital improvement
projects in or near Lake Washington.
• Continue to focus the Stormwater utilities capital program on projects that reduce the amount of
sediment being deposited in Lake Washington while protecting private and public property from
damaging erosion.
• Continue to raise awareness for the Luther Burbank Park homeowner demonstration area and
similar efforts to naturally stabilize eroding shoreline while maintaining shore access.
• Identify opportunities to create Low Impact Development demonstration projects whose cost is
covered or reduced by grant funding.
Conserving Resources and Reducing Carbon Emissions
• Regularly tabulate carbon footprint of City operations and assure continuous reduction to meet 80%
reduction goal by 2050.
• Maintain record of City initiatives and new practices that effectively reduce energy consumption and
carbon emissions, and share City experience with the community through public
information/education efforts.
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C-32 City of Mercer Island 2011-2012 Budget
Budget Policies
• Work with Island residents and City staff to meet the waste reduction and recycling goals
established in the new Comprehensive Solid Waste Management Plan for King County.
• Work with Allied Waste to achieve the sustainability objectives identified in the City’s new long-
term contract with Allied, including the recycling of food waste along with yard waste and the
replacement of the company’s fleet with trucks operating on alternative fuels.
• Establish and maintain partnerships with the Mercer Island School District and energy-supplier Puget
Sound Energy to set and reach aggressive resource conservation goals.
• Continue efforts to promote water conservation by residents and at City facilities.
• Identify and implement capital improvements to City facilities that offer positive resource
conservation return on investment.
• Maintain a healthy urban forest through effective vegetation management programs.
• Implement a pilot project encouraging the planting of trees on private property to offset the impacts
of development.
• Encourage City staff to develop innovative approaches to making sustainability a part of each work
day.
• Develop a comprehensive Six Year Sustainability Plan for City Government that assigns resources to
specific improvements through year 2015.
Green Power
• Establish a percentage goal for the purchase of green power for the City’s electricity needs.
• Through well-defined pilot projects, explore applications for the use of solar and other alternative
energy sources in City operations.
• Install charging stations at community facilities and continue to look for opportunities to expand the
number of units and locations.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditure
Actual Forecast Budget Budget
Base Budget (Operating):
Recycling Services $ 45,466 $ 50,750 $ 50,900 $ 50,900
Water Conservation 21,774 30,000 30,000 30,000
Storm Water Operations & Maintenance 859,495 1,036,815 913,372 942,279
Urban Forest Management (Right of Way) 97,968 125,989 80,000 80,000
Service Packages (2009 - 2012)
Digital Plan Review 12,700 1,700 - -
Tree Planting Program 10,000 10,000 - -
Resource Conservation Manager 7,000 7,420 7,000 -
Water Leak Detection Program 25,000 25,000 - -
Capital Improvement Program:
Vegetation Management 321,804 553,195 422,000 378,000
Low Impact Development Study - 50,000 50,000 250,000
Storm Water Capital Projects 776,972 393,436 1,200,000 1,034,000
Total $ 2,178,179 $ 2,284,305 $ 2,753,272 $ 2,765,179
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City of Mercer Island 2011-2012 Budget C-33
Budget Policies
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C-34 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Utility Funds
This section includes
budget polices on the
following:
• Interfund
Administrative
Charges
• Utility Maintenance
and Construction
• Utility Fiscal Policies
Budget Policies
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C-36 City of Mercer Island 2011-2012 Budget
Budget Policies
Interfund Administrative Charges
Background
The City-owned utilities are classified as Enterprise Funds. Various departments, which are accounted
for in the General Fund, provide administrative support to each of the City’s three utilities (water,
sewer, and stormwater). In addition, building maintenance costs related to City Hall and the
Maintenance Center and insurance costs (i.e. property and liability) are paid by the General Fund. In
order for the utility budgets to reflect the full costs of administration, building maintenance, and
insurance, an interfund transfer is made from each of the City’s three Utility Funds to the General Fund.
In effect, the General Fund charges each Utility Fund for costs that support the provision of utility
services.
Administrative Charges
There are five cost centers in the General Fund that benefit each of the City’s three utilities: City
Attorney’s Office, City Council, City Manager’s Office, Finance Department, and Human Resources
Department. The basis for the interfund administrative charge associated with each cost center is noted
below:
General Fund Cost Center Interfund Charges 2011 2012
City Attorney's Office 15.0% of budget $ 72,747 $ 74,913
City Council 15.0% of budget 5,885 5,885
City Manager's Office 15.0% of budget 113,218 117,866
Finance Department 24.0% of budget 150,071 158,778
Human Resources Department 11.0% of budget 50,203 51,620
Total $ 392,124 $ 409,062
The portion of the City Attorney’s Office, City Council, and City Manager’s Office budgets which can be
attributed to the Utilities is based on the proportion of agenda bills and contracts which are related to
each Utility.
The portion of the Finance Department budget which can be attributed to the Utilities is based on the
percentage of time spent by each position on a utility-related task. Three positions (Utility Billing
Supervisor, Customer Service Representative, and Meter Readers) are directly allocated to the Utilities
and the General Fund. The remaining four positions are allocated to the Utility Funds as follows:
Finance Director (15%), Deputy Finance Director (45%), Accounting Manager (15%), and Accounts
Payable Clerk (20%). The blended proportion of the Finance Department budget allocated to the
Utilities collectively is 24%.
The portion of the Human Resources Department budget which can be attributed to the Utilities is
based on the number of Utility employees relative to the total number of City employees.
These administrative costs are allocated to the Utilities as follows: Water (45%), Sewer (45%), and
Stormwater (10%).
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City of Mercer Island 2011-2012 Budget C-37
Budget Policies
Building Maintenance Charges
Maintenance costs for City Buildings are consolidated in one cost center within the General Fund.
Building maintenance charges include a 0.5 FTE, who oversees routine maintenance and repair projects,
utilities (power, gas, water and sewer) used by the buildings, as well as contracted repair and
maintenance services. Actual costs of utilities are available for each building. Other costs are allocated
to the Maintenance Center and City Hall based on the square footage of the buildings. These costs are
then charged back to the Utilities based on FTE’s within each building, as follows:
Facility Building Cost Water Sewer Stormwater General Fund
Maintenance Center $ 91,887 32.8% 22.4% 12.0% 32.8%
City Hall $ 215,753 3.5% 3.5% 2.5% 90.5%
Insurance Charges
The City is insured by Washington Cities Insurance Authority for property and liability.
Property insurance is charged based on asset value. The value of water, sewer, and stormwater assets
covered under the City’s insurance policy is the basis for the property insurance cost allocation. The
interfund charges for 2011-2012 are as follows:
Funding Sources Asset Value % Allocation Insurance 2011 Insurance 2012
Water Fund $ 11,129,249 19.23% $ 17,368 $ 17,716
Sewer Fund 5,177,710 8.94% 8,080 8,242
Stormwater Fund 336,515 0.58% 525 536
General Fund 41,244,640 71.25% 64,367 65,653
Total $ 57,888,114 100.00% $ 90,340 $ 92,147
Liability insurance was analyzed based on a 5 year rolling average of claims experience. Projected
liability premiums were allocated to the Utilities based on their portion of claims paid during the
preceding 5 year period (2005-2009). The charges for 2011-2012 are as follows:
Funding Sources % Allocation Insurance 2011 Insurance 2012
Water Fund 8.91% $ 61,306 $ 66,210
Sewer Fund 12.90% 88,779 95,881
Stormwater Fund 6.91% 47,549 51,353
General Fund 71.28% 490,690 529,946
Total 100.00% $ 688,324 $ 743,390
Budget Policies for 2011-2012
• Ensure that the General Fund does not subsidize any of the City’s Utilities.
• Assess interfund charges for administration, building maintenance, and insurance to each Utility in
2011 and 2012 per the allocation factors and the Preliminary Budget amounts noted above.
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C-38 City of Mercer Island 2011-2012 Budget
Budget Policies
• Remove 2 Finance Department employees (Utility Billing Supervisor and Customer Service
Representative) from the Administrative Charges and charge them directly to the Utility Funds.
These positions were included in the Administrative Charges in prior years.
• Continue to exclude one additional Finance Department employee (Meter Reader) from the
Administrative Charge and charge it directly to the Utility Funds.
2011-2012 Budget Impact
2009 2010 2011 2012
Charges Actual Forecast Budget Budget
Water Utility Admin & Insurance Charges $340,700 $363,400 $292,750 $306,262
Sewer Utility Admin & Insurance Charges $340,700 $363,400 $301,430 $316,792
Storm Water Utility Admin & Insurance $127,100 $137,000 $103,837 $109,629
Total $808,500 $863,800 $698,017 $732,683
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City of Mercer Island 2011-2012 Budget C-39
Budget Policies
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C-40 City of Mercer Island 2011-2012 Budget
Budget Policies
Utility Maintenance and Construction Policies
Background
As part of each biennial budget cycle, City staff identifies and prioritizes water, sewer and storm water
construction projects. The proposed projects are reviewed annually by the Utility Board and during
Capital Improvements Program (CIP) planning processes. The projects are included in six-year plans for
each of the utilities, which are much like the Transportation Improvement Plan (TIP). These six-year
plans provide a roadmap for development of the biennial budget, assist with strategic rate planning, and
allow for effective coordination among the utilities and streets projects.
Management Policies for 2011-2012
Sewer Utility
Reinvestment in the Sewer Utility is guided by the General Sewer System Plan adopted by Council in
2003. This plan provided detailed guidance on Capital Reinvestment through 2008. Staff has updated
the 6 year plan for Sewer to include more detail on Capital Reinvestment needs for 2011-2016.
With the completion of the Sewer Lake Line Replacement Project, the focus for capital improvements
will turn to repairs and replacements identified during the comprehensive video inspection of the
collection system that began in 2007. The installation of at least one new access point this biennium for
cleaning the Lake Line also has been ranked as a priority.
The prevention of back-ups in the sewer collection system will continue to be another top priority and
will be given both the financial and staff resources necessary for success. The ongoing cleaning and video
inspection of the system is critical to detecting and eliminating problems such as roots and grease that
can cause back-ups.
The implementation of recommendations contained in the final Sewer Lake Line Back-Up Action Plan (a
study conducted in 2010) will be a top priority for the Sewer Utility. These include both operational
efforts and capital improvements such as new access points to clean the Lake Line.
Water Utility
Reinvestment in the Water Utility is guided by the Water System Plan adopted by Council in 2008.
The replacement of substandard water mains, particularly those that are undersized and do not comply
with the City’s fire flow policy, will continue to be a primary focus of water system capital
improvements this biennium. At the current rate of funding, it is expected that it will take about 20
years to replace the substandard mains in the system.
The ability to distribute water from the Emergency Well into Island neighborhoods also will continue to
expand during 2011-2012, with additional Utility crew and volunteer training. Other new aspects of well
operations, such as periodic sampling and testing of the water produced by the well, will be
programmed.
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City of Mercer Island 2011-2012 Budget C-41
Budget Policies
Storm Water Utility
Reinvestment in the Storm Water Utility is guided by the Comprehensive Basin Plan adopted by Council
in 2006. In addition, period Basin Reviews are conducted to review the deterioration in the City’s
Storm Water basins. Timing of construction is adjusted as conditions change.
With the completion of the last identified major basin project expected in this biennium, planning for
future basin improvements will turn to multiple smaller projects and the early stages of replacing the
City’s piped drainage systems.
All Utilities
City utility improvements, particularly water system improvements that are to be completed in
conjunction or ahead of street projects will be identified earlier to better accommodate the priorities of
both the Transportation Improvement Plan for streets and the priorities of the utilities. When
necessary, preliminary design will be conducted to refine the scope of the improvements and provide a
more accurate estimate for design and construction costs.
Budget Policies for 2011-2012
• Water: Continue to increase rates in order to meet the $1.7M rate funding target for Water set
in the Water System Plan. [Note: The plan sets an annual capital reinvestment of target of $1.8M.
The balance of the funding will come from connection charges, interest, and other non-rate
revenues]
• Water: Consider the use of debt financing in order to accelerate the construction of several high
priority water projects.
• Sewer: Increase rates in order to meet the $900K rate funding target of the 6 year capital plan for
Sewer.
• Storm water: Increase rates slowly in order to meet the $1.0M rate funding target of the 6 year
capital plan for Storm water.
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C-42 City of Mercer Island 2011-2012 Budget
Budget Policies
Utility Fiscal Policies
Background
During 1993 the Utility Board and staff worked closely to establish financial policies to guide future rate
and budget decisions. During 2006 the Utility Board reviewed and modified the financial policies related
to the Water Utility. The financial policies analysis consisted of identifying, describing, and to the extent
possible, evaluating impacts of various elements of the policies. Elements discussed included types and
levels of utility reserves, methods of capital improvement funding, methods of capital replacement
funding, rate structure and equity, and related objectives such as water conservation.
The fiscal policies, which have been approved by the Utility Board, consist of four major categories that
are briefly described below. A complete copy of the policies is included on the following page.
A. Reserves
This section sets the policy for the amount of operating reserves necessary. Sewer and Stormwater
operating reserves are set at 30 days of operating expenses while water is set at 75 days (due to the
greater seasonality of revenue). The need for a capital replacement reserve is also discussed and
the format for establishing such a reserve is fixed.
B. Financing
A policy is set that capital replacement projects will be financed from the replacement reserve
established in the reserve section. It also discusses the concept of financing most improvements on
a pay-as-you-go basis; however, consideration must always be given to the effect of the rate impacts
on customers. It proposes that when projects are over $500,000 other financing alternatives should
be considered.
C. Revenue Requirements
This section summarizes and formalizes our policies to set rates sufficient to meet all utility cash
requirements including operating expenses, debt service, and additions to reserves and capital costs.
It also reflects the policy to set rates to meet any bond or other debt covenants.
D. Rates and User Charges
There are two policies established in this section. The first policy concerns water conservation. It
establishes that the City wishes to promote water conservation and will set water rates that reflect
that policy. The second policy concerns the concept of a "lifeline rate" to provide basic water and
sewer services at an affordable level. The lifeline rate works with the water conservation volume
based structure to provide low levels of water usage at the lowest cost.
Budget Policies for 2011-2012
• Propose rates for the Utilities that reflect the financial policies adopted by the Utility Board.
• Perform annual rate studies for each of the utilities (Water, Sewer, and Storm water). For
preparation of the biennial budget, rates are also forecast for the second year of the biennium.
• Work with a financial consultant to review the water rate model developed in 2006. Review
customer consumption patterns, customer class allocations, and the block structure for rates.
• Work with a financial consultant to develop a new sewer rate model which will adjust for changes in
customer consumption patterns.
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City of Mercer Island 2011-2012 Budget C-43
Budget Policies
Fiscal Policies for Water and Sewer Enterprises
This document is to be read in conjunction with the Level of Service Standards established for the
Water and Sewer Systems. Together they form the basis for 1) the updating of the Comprehensive
Plans for both Water and Sewer through the end of the decade; 2) the Capital Facilities Plan prepared as
part of the City's Comprehensive Plan in response to the Growth Management Act; and 3) the biannual
operating plans for each utility. It is intended that these policies be reviewed periodically; at the
minimum each time either the Utility's Comprehensive Plan is updated or when the Capital Facilities
Plan is updated.
A. Revenue Requirements
1. Cash Needs
Each utility will establish rates sufficient on an annual basis to meet all utility cash requirements
including operating expenses, debt service, additions to reserves and rate-funded capital costs.
2. Coverage
Each utility will establish rates sufficient to meet all security conditions of outstanding debt,
including any bond coverage requirements. Typically bond covenants require a minimum
coverage factor of 1.25, although the City may elect to establish a higher factor in order to
enhance its potential bond rating. Should the coverage requirement result in a revenue
requirement in excess of cash needs, the budget shall identify the use, transfer or addition to
reserves intended for the surplus. Such cash surplus cannot be used to meet operating
expenses.
If debt is jointly issued, or issued under conditions pledging all utility revenue, the debt service
will be allocated to the water or sewer utilities based on the use of bond proceeds, and the
coverage requirement will be allocated to each utility based on their share of the debt service.
B. Rates and User Charges
1. Rate Equity
The City will establish rates and charges, which equitably recover the cost of service from each
utility's customers. Changes in rate structure will be accompanied by a cost of service analysis
justifying the equity of such changes. Rate structures considered will, to the extent practical and
equitable; incorporate other rate objectives as defined in these policies.
2. Conservation
The City wishes to promote efficient and conservative use of water. Therefore, water and
sewer rates will, to the extent practical, promote water conservation through an emphasis on
volume-based charges and allocation of the cost of meeting peak demands to those users
imposing the cost.
3. Lifeline Rates
The City wishes to provide water and sewer service to meet basic human needs at an affordable
level. Therefore, rate structures should consider the opportunity to maintain reasonable water
and sewer bills at lifeline usage levels. Features such as volume-based sewer charges, increasing
block water rates, and low fixed service costs among others help to promote this objective.
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C-44 City of Mercer Island 2011-2012 Budget
Budget Policies
C. Reserves
1. Operating (Working Capital) Reserve
It is appropriate to maintain sufficient cash reserves to accommodate routine fluctuations in
revenues and expenses. The City therefore establishes operating reserves for the water and
sewer utilities. Utility budgets will target ending cash balances sufficient to meet the reserve
targets. The following operating reserves are established:
• Sewer - 30 days of operating expenses (8.2% of annual operating budget)
• Storm Water - 30 days of operating expenses (8.2% of annual operating budget)
• Water - 75 days of operating expenses (20.5% of annual operating budget)
In 2006, the Utility Board recommended that the Operating Reserve for the Water Utility be
increased from 75 to 90 days. The increase is to be funded by excess revenue in high water use
years, rather than by rate increases.
The water reserve has been established at a higher level than sewer and storm water to reflect
the greater seasonality of revenues and to protect against reduced water sales in wet years or
during restrictions.
Should the operating reserves for either utility fall below the target level, or should the target
level be increased, additions to the reserve will be budgeted to reach and maintain that level
within no more than two budget years.
2. Capital Improvement Reserve
It is considered that both the water and sewer utilities are completed to their capacity and that
it is not required or prudent to establish a reserve for capital improvements.
There are, however, water and sewer systems now existing on Mercer Island which are not part
of the City Utilities. It is the Board's recommendation not to incorporate those other systems
into the City Utilities unless those systems meet the performance standards established for the
City's water and sewer utilities.
3. Replacement Reserve
It is prudent to protect the City's multi-million dollar investment in utility assets. The City
therefore establishes a capital replacement reserve and funding strategy. These reserves should
enable the City to support future replacement needs without extraordinary rate increases, while
recognizing the responsibility of existing customers to fund both current and future replacement
needs on a regular basis.
It is intended that all replacement projects that are to be funded on a pay-as-you-go basis be
funded from the appropriate replacement reserve. This requires that the City carefully plan and
schedule replacement projects so that the integrity of the replacement reserve is maintained.
The following annual contributions to reserves are established:
Water The minimum capital funding level will be based on the annual depreciation
expense for water plant-in-service, adjusted to reflect replacement costs.
(Replacement cost estimates are based on a "construction cost index"
published by the Engineering News Record.) The annual contributions can
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City of Mercer Island 2011-2012 Budget C-45
Budget Policies
be reduced or eliminated once the balance in the replacement reserve is
sufficient to meet the program set forth in the approved Capital Facilities
Plan.
Sewer Same formula
4. Contingency (Emergency) Reserve
It is not considered necessary to establish a separate reserve for the Sewer and Storm Water
Funds to handle emergency situations in addition to the replacement reserve. It is considered
prudent however that the replacement reserve not be scheduled to be less than $100,000.
Should situations arise where the replacement reserve does drop below that level due to an
emergency, the reserve level should be restored to at least the minimum level within the
following budget year.
In 2006, the Utility Board recommended that a new Contingency Reserve be established for the
Water Utility. This reserve would be equal to 1% of the original asset value ($240,000 in 2006).
The reserve is to be funded by excess revenue in high water use years, and not by raising rates.
5. Bond Reserves
It is an obligation of the City to meet reserve requirements of bonds and loans, which it uses for
utility purposes. It is the policy of the City to fully fund such reserves as required by bond
covenant or loan agreement.
D. Financing
1. Capital Facilities Planning
Due to the impact of capital costs on rates and charges and due to the variation in funding levels
needed over time, each utility will establish and maintain a capital projects schedule of at least
six years in duration. Said schedule will be consistent with the Utility's Comprehensive Plan.
This schedule will include project description, scheduled year of construction and total
estimated cost. Each project will be identified as an improvement project or a replacement
project (including repair and rehabilitation). If projects provide both improvement and
replacement benefits, then the schedule will include an appropriate allocation of project costs to
the two categories and then use the criteria below for the allocated portions.
2. Improvement Projects
Improvements to the system shall be scheduled and budgeted with consideration of the rate
impacts that may result. It is the City's intent to make such improvements without the issuance
of new debt, except when opportunities for below market rate loans may arise. However, in
the case of projects involving a capital outlay of $500,000 or more per year, the City will
evaluate alternatives including phasing, deferral or debt financing as methods to mitigate rate
impacts.
3. Replacement Projects
Replacement projects are normally to be funded from the replacement reserve. However, if the
funding needs exceed $500,000 per year, the City will evaluate alternatives to total rate funding
to mitigate rate impacts. Alternatives to be considered include phasing and/or deferral of
projects or debt financing.
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C-46 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Capital Improvement Program
This section includes
budget polices on the
following:
• Capital Improvement
Program
• Street Maintenance
and Construction
• Information
Technology
• Vehicle & Equipment
Replacement
Budget Policies
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C-48 City of Mercer Island 2011-2012 Budget
Budget Policies
Capital Improvement Program
Background
The City of Mercer Island separates the Capital Improvement Program (CIP) into two parts: the Capital
Reinvestment Plan (CRP) and the Capital Facilities Plan (CFP). The CRP contains all major maintenance
projects for existing public assets. The CFP consists of proposed new capital facilities.
Capital Reinvestment Program (CRP)
The CRP's purpose is to organize and schedule repair, replacement and refurbishment of public
improvements for the City of Mercer Island. The CRP is established as a six-year program setting forth
each of the proposed maintenance projects, including the cost and funding source. The individual six-
year plans for capital reinvestment serve as the City's capital planning documents as required by the
City's Comprehensive Plan (Capital Facilities Element) and the State Growth Management Act.
The program emphasis in a reinvestment plan is timely repair and maintenance of existing facilities. To
this effect, while new equipment and improvements are made to some older fixed assets, the intent is to
design a program, which will preserve and maintain the City's existing infrastructure. The maintenance
and enhancement of the taxpayer's investment in fixed assets remains the City's best defense against the
enormous cost of the replacement of older but still very valuable public improvements.
The CIP is intended to be a public document. For this purpose, it is organized by functional area.
Hence, any individual who wishes to gain knowledge about a project need not know the funding source
or any other technical information but only needs to know the general type of improvement in order to
find the relevant information. The Capital Reinvestment Program is divided into four functional
programmatic areas: streets (including pedestrian and bicycle facilities), park and recreational
facilities (including open space), general government (including building repairs, technology and
equipment), and utilities (water, sewer, and storm water).
CRP projects are typically "pay as you go", which means funded from the current operations of the
Street Fund, Capital Improvement Fund, Technology and Equipment Fund, and the Utility Funds (Water,
Sewer, and Storm water).
Capital Facilities Plan (CFP)
The CFP is also a six-year plan to outline proposed new capital projects. The CFP is divided into the
same four component parts as the CRP. Like the CRP, the CFP plan for new facilities is intended to
provide easy reading. Each project in the plan is described briefly, and the total cost and appropriation
for a six-year period is stated. Like the CRP, the CFP serves the capital planning requirements for six-
year plans as outlined in the Comprehensive Plan and State Growth Management Act.
As it is with the CRP, the CFP is organized by category of project.
Funding for CFP will generally be decided simultaneously with the approval of the project. This may
involve a bond issue, special grant or a source of revenue that is outside the available cash resources of
the City.
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City of Mercer Island 2011-2012 Budget C-49
Budget Policies
Nomination Process
As a part of each biennial budget process, the CIP Committee receives proposals for needed capital
projects submitted by the affected department managers, team leaders, advisory bodies, City Council,
and others. The CIP Committee compiles and reviews the project proposals, their associated costs and
funding sources. Based upon Council priorities and staff-developed project evaluation criteria, the
Committee makes a recommendation on project funding priorities to the City Manager. Council-
appointed boards and commissions, such as the Utility Board, also provide input to project funding
requests.
Project Funding Status
In order to facilitate the review of proposed Capital Projects both during the CIP Preview and the
Preliminary Budget, projects have been categorized first by functional programmatic area and then by
project funding status. Projects have been sorted within functional area by one of the following four
funding status categories:
1. Funded – No changes (except for inflationary adjustments and revised cost estimates)
2. Funded – Modified (in terms of scope and/or timing)
3. Funded – New Project (project was not included in the 2009-2014 Capital Plan)
4. Unfunded or Partially Funded (Project still requires some or all funding before project can
proceed).
Routinely CIP projects have been sorted and presented by category, year of construction and revenue
source. In the last budget (2009-2010) the categorization by project funding status was added.
Project Management
Project management costs are included in the budget of each capital project, with staff time being
charged directly to the appropriate project. The CIP Team in the Maintenance Department makes up
the project management staffing for Street and Utility projects. In addition, a small percentage of time is
spent by Parks staff (i.e. Parks Operations Superintendent, Parks Maintenance Manager, and the Parks
Arborist) and the Information and Geographic Services Team on capital project management.
CIP Administrative Overhead Charges
Indirect staffing support of capital projects is provided by the positions listed in the table below. With
the exception of the Maintenance Director, all of these positions are wholly budgeted in the General
Fund. An analysis of the percentage of time spent by each position supporting the City’s capital
improvement program is updated every two years by the Finance Department, resulting in a CIP
administrative overhead charge to the following funds: Street Fund, Capital Improvement Fund, Water
Fund, Sewer Fund, and Storm water Fund. This overhead charge enables the City to recognize the full
cost of the City’s capital improvement program by reimbursing the General Fund for the staff time spent
supporting capital projects.
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C-50 City of Mercer Island 2011-2012 Budget
Budget Policies
Position Interfund Charges 2011 2012
Finance Director 10% of position 18,490 19,129
Deputy Finance Director 45% of position 61,960 64,218
City Attorney 5% of position 9,079 9,393
Assistant City Attorney 5% of position 6,167 6,396
Public Information Coordinator 5% of position 5,058 5,252
Maintenance Director 10% of position 18,539 19,180
Parks and Recreation Director 15% of position 26,486 27,405
City Manager 2.5% of position 5,453 5,645
Deputy City Manager 10% of position 18,880 19,532
Total 170,112 176,150
Management Policies for 2011-2012
• Increase public involvement in the planning and design of capital projects.
• Improve public information about pending construction projects and their impacts (detours, delays,
and effects on neighborhoods).
• Use signage, the City’s website, and the MI Weekly to highlight certain projects.
Budget Policies for 2011-2012
• CRP projects take priority over CFP projects in recognition of the desire to maintain and improve
existing assets before acquiring new assets. Acquisition of major new capital assets should generally
be funded with new revenues.
• For “macro-financial” issues, staff should use at least a 10-year time frame and extend the financing
period out to as much as 20 years for some capital items.
• Use debt financing only when the following conditions exist:
1. Object of the expenditure is a major new capital asset.
2. Object of expenditure can be used by residents/taxpayers in the future.
3. There are insufficient existing capital revenues available.
4. All the revenue is needed at the same time (i.e. the project cannot be phased over time.)
• Major impacts on the City’s operating funds will be identified and budgeted before projects are
approved.
• The CIP is a dynamic plan subject to changes in City Council policy, financial environment, design
information, emergencies, and unique opportunities that can arise over a multi-year planning period.
• The CIP will be developed in accordance with requirements of the State Growth Management Act
and will be consistent with Capital Facilities Element of the City's Comprehensive Plan.
• Within the context of a biennial budget, the City will develop a six-year plan for capital
improvements. The six-year plans contained in the CIP fulfill the City's six-year planning
requirements outlined in the Growth Management Act and Comprehensive Plan.
• The City will enact a two-year capital budget based on the Capital Improvement Program.
• The City will attempt to maintain its assets at a level adequate to protect capital investment and
minimize future maintenance and replacement costs.
• The City will identify the estimated costs and potential funding sources for each capital project
proposal before it is submitted to the City Council for approval.
• Capital projects are budgeted and funds allocated in the year that the project is acquired or
constructed.
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City of Mercer Island 2011-2012 Budget C-51
Budget Policies
• Whenever possible, capital improvements will be scheduled and completed in the same year.
• Prior to City Council funding commitments on major capital projects, the City will conduct detailed
and professional cost estimating analyses.
• In general, the City will plan and implement capital improvement projects so that the spring-
summer-fall construction season is used to the community's greatest advantage.
• Technology projects will be budgeted and accounted for in the Technology Fund.
• When the City receives unanticipated or extraordinary capital revenue, the City Council will
consider transferring it to the Capital Reserve Fund, or:
1. Complete a previously identified, unfunded project;
2. Add funds to a capital program category (such as parks) for a specific desired project;
3. Advance an already programmed and budgeted capital project (such as pedestrian and
bicycle facilities); or
4. Complete a project that will decrease maintenance and operating costs.
• Overhead charges associated with the City Manager’s Office, City Attorney’s Office, and Finance
Department will be charged to the Capital Project Funds and credited to the General Fund.
_________________________________
C-52 City of Mercer Island 2011-2012 Budget
Budget Policies
Street Maintenance and Construction
Background
As part of each biennial budget cycle, City staff develops and prioritizes street, pedestrian and bicycle
facilities maintenance and construction projects. The proposed projects are reviewed annually during
the Six-Year Transportation Improvement Program (TIP) and biennially during the Capital
Improvements Program (CIP) planning processes. Both the TIP and the CIP plans are submitted to and
ultimately approved by the City Council.
As prescribed by state law, the City Council adopts a "Six-Year Transportation Improvement Program"
as part of the budget process. The Six-Year Plan covering the 2011-2012 biennium was adopted by City
Council on June 7, 2010 and is included in the proposed Capital Improvement Program (see Section H
of the budget). Adoption of the program also serves to implement portions of the City Comprehensive
Plan (Transportation and Capital Facilities Elements).
Streets are regularly evaluated and prioritized for improvement based on a formal Pavement Condition
Rating and other criteria (review of safety, maintenance and implementation). The criteria are not
weighted in order to maintain flexibility needed to accommodate unexpected needs or opportunities.
However, the results provide predictability for when particular streets are expected to be improved. In
addition, the City periodically analyzes intersections to measure the traffic impacts associated with
development proposals to maintain the City’s adopted traffic level of service standard. Project impacts
determined by this analysis will be mitigated through the SEPA process. Whenever possible, staff plans
utility projects to precede street construction and plans construction of pedestrian and bicycle facilities
with nearby arterial and residential street projects.
In 2011 and 2012, the City anticipates revenues of $1.4M and $1.6M respectively. This level of
reinvestment in the City's streets and pedestrian and bicycle facilities systems will ensure that the City's
arterial and residential streets will be maintained at safe and efficient levels within 20 or 35 year life
cycles.
Assuming implementation of the following budget policies, this level of funding will support completion
of the highest priority transportation projects in the upcoming biennium, including implementation of
projects identified in the Pedestrian and Bicycle Facilities Plan. The PBF Plan was reviewed and updated
during the 2009-2010 biennium. The updated Plan was adopted by the City Council in June 2010.
Budget Policies for 2011-2012
• 100% of annual fuel tax revenues will be used for pavement marking, patching, street overlays and
substandard residential street upgrades.
• An annual average of $300,000 in Real Estate Excise Tax revenue (2nd quarter-cent) is dedicated to
pedestrian and bicycle facility maintenance and construction projects in 2011-2012.
• The remaining balance ($554,000 in 2011) of annual Real Estate Excise Tax revenue, along with any
available fund balance, is dedicated to major street construction projects and other transportation
projects and activities.
• The Storm Water Utility will absorb an appropriate share of the costs of adding drainage systems to
some residential streets. The Water Utility will help fund the replacement of services and hydrants
in neighborhoods where it is determined to be appropriate. This will allow certain residential
streets in need of repair to move up on the priority list for the residential street repair program.
_________________________________
City of Mercer Island 2011-2012 Budget C-53
Budget Policies
• The policy of maintaining street funding on an inflation adjusted basis will continue to be on hold for
the 2011-2012 biennium. Funding for street maintenance and construction had been maintained on
an inflation adjusted basis since 2002. Using 2002 as the revenue benchmark, funding has been
benchmarked to an annual factor of inflation (the WSDOT Construction Cost Index) plus one
percent. Due to the economic slowdown which started in 2007 and which is forecast to continue
through 2013, Real Estate Excise Tax revenue will be split evenly between the Street Fund and the
CIP Fund for the 2011-2012 biennium, as it was in the prior 2009-2010 biennium, in order to
maintain reasonable levels of reinvestment in all REET funded assets (streets, parks, and buildings).
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ - $ 1,741,839 $ - $ 426,502
Real Estate Excise Tax 628,940 992,500 854,375 1,089,500
Fuel Tax - City Streets 492,732 502,587 509,623 519,815
General Govt / Grants / Fines 917,848 9,143 - -
Interfund Transfers In 147,897 - - -
Total Budgeted Resources $ 2,187,417 $ 3,246,069 $ 1,363,998 $ 2,035,817
Not Budgeted
Beginning Fund Balance (Reserved) 3,405,383 1,905,461 1,905,461 1,487,999
TOTAL RESOURCES $ 5,592,800 $ 5,151,530 $ 3,269,459 $ 3,523,816
USES
Budgeted
Residential Street Preservation $ 1,462 $ 1,121,484 $ 480,000 $ 471,000
Town Center Street Reconstruction 45,319 1,186,020 - -
Arterial Street Improvements 1,069,437 208,166 170,000 1,115,000
Pedestrian & Bicycle Facilities 433,351 339,749 450,000 165,000
Other Transportation Projects 135,148 190,032 115,000 140,000
Other Transportation Activities 250,782 200,618 139,957 144,817
Interfund Transfer 10,000 - - -
Total Budgeted Expenditures $ 1,945,499 $ 3,246,069 $ 1,354,957 $ 2,035,817
Not Budgeted
Ending Fund Balance 3,647,300 1,905,461 1,914,501 1,487,999
TOTAL USES $ 5,592,799 $ 5,151,530 $ 3,269,459 $ 3,523,816
_________________________________
C-54 City of Mercer Island 2011-2012 Budget
Budget Policies
Information and Geographic Services
Background
Local governments, like Mercer Island, are increasingly expected to provide accurate, timely and
comprehensive information on services and initiatives impacting the businesses and lifestyles of their
citizens. These City services and initiatives increasingly rely on technology. The City is also required to
streamline business practices while adhering to complex and rapidly changing regulatory requirements.
Citizens expect the City to collect and process their input and comments as well as interpret and
convey information about programs, services, regulatory impacts, geographic/land features, emergency
alerts and more. To do so, City staff must efficiently utilize and maintain available technologies as well as
prepare for and implement new technologies.
A primary and significant City business function is communicating information—creating, disseminating,
and archiving diverse and rapidly changing information and data for staff and citizens. To do so efficiently
and effectively within the City, Information and Geographic services support:
• 250 telephone handsets, extensions and business lines
• 33 physical/virtual network servers
• 192 workstations servicing over 230 users
• 9 major business-specific applications as well as over 75 productivity applications
• 7 independent City facilities and associated infrastructure
• Remote network access and wireless network applications
• Over 200 Layers of Spatial Information related to City Infrastructure and Assets
• Several Websites for Public Use
This infrastructure services financial, payroll, utility billing, public safety, geographical mapping services,
citizen and customer maintenance requests, internal and external websites, electronic newsletters and
ListServes, security systems, maintenance management tools, building permit systems, water and waste
water monitoring, facility scheduling and recreational activity registration, irrigation and ballfield lighting
controls and more.
Wise City investment in technology tools (hardware, software, networks, phone systems, etc.), regional
technology partnerships, and strategic innovation enables the City to maximize its limited human and
financial resources. In addition, as one of the nine regional founding partners in the eCityGov Alliance,
now a consortium of 29 member agencies, the City can capitalize on the pooling of resources and
leadership skills to provide more seamless and easy to use on-line services for citizens and businesses
through one website portal.
The City will continue to replace and upgrade its Information and Geographic Systems, support business
specific applications, and pursue pilot projects where innovations may improve service delivery or
provide services more efficiently.
The Information and Geographic Services (IGS) Team is dedicated to:
• Insuring 24/7 reliability of the City’s core business systems through timely upgrades, patches and
redundant infrastructure configuration as well as prompt vendor and IT support response;
• Pursuing reputable and reliable off-the-shelf software systems and standardizing custom
development whenever possible;
_________________________________
City of Mercer Island 2011-2012 Budget C-55
Budget Policies
• Focusing Information and Geographic Services investments on core business needs and pursuing
inexpensive solutions; and
• Supporting further low-cost/high benefit development of eCityGov Alliance products and
services.
Budget Policies for 2011-2012
• Maintain City’s investment in computers, servers, and printers by replacing equipment on a planned
schedule. For example, most computers have reached their useful life and are scheduled to be
replaced on a 4 year cycle.
• Maintain City’s investment in major systems and databases through periodic software and hardware
updates.
• Increase response for public disclosure/public information through a web-based searchable public
document management system for citizens and staff;
• Enhance user functionality, navigability and search capabilities by upgrading and enhancing the City’s
website;
• Consolidate physical server systems into virtual systems to maximize utilization of server hardware.
• Investigate methods to more efficiently disseminate critical incident and emergency information to
citizens and emergency workers using the City’s website and Geographic Information Systems (GIS);
• Replace antiquated computer equipment and database systems to better support rapidly changing
business systems and their operating requirements;
• Conduct more accurate analysis and management of roadways and shoulders, utilities, residential
and business building footprints, utilities, trees and vegetation and property line delineations by
periodically updating the aerial mapping data with high accuracy (within 1 foot) color aerial photos of
the Island; and
• Facilitate production of the City’s budget process by updating the City’s financial system to allow
web-based budgeting and capital project management.
2011-2012 Budget Impact
2009 2010 2011 2012
Charges Actual Forecast Budget Budget
Computer and Printer Replacements $203,326 $102,000 $120,000 $70,000
Capital Reinvestment – Technology 263,122 355,013 75,000 135,000
NORCOM Startup Fees 186,230 46,170 0 0
Total $652,678 $503,183 $195,000 $205,000
_________________________________
C-56 City of Mercer Island 2011-2012 Budget
Budget Policies
Vehicle and Equipment Replacement
Background
The individual units of the City's fleet of vehicles and equipment are assigned to the various
departments, but are accounted for in the City's Equipment Rental Fund. Based on historical, actual
expenses plus overhead, operating and maintenance rates are developed biennially for each vehicle class
and assessed to each department. In addition, replacement rates are developed biennially for each
vehicle and piece of equipment in the fund. Separate replacement reserves have been established for
the accumulation of funds to replace vehicles/equipment, fire apparatus, and emergency radios. The
current fleet of vehicles and equipment stands at 150 units and has an estimated asset value of
approximately $6.7 million (based on purchase cost).
Beginning in 2009, Finance staff created a fleet replacement rate model based on cash flows,
incorporating the estimated salvage or trade-in values, inflationary factors, and useful life assumptions for
each individual vehicle. Inflated replacement cost estimates were then used to determine the cash
outflows for the fund as a whole over a 30 year period. The cash inflow required to cover the
replacement cost cash outflows became the basis for setting the annual replacement charge to the
departments. The annual cash inflow (contribution) amount was allocated to the departments based on
their present value percentage ownership of the fleet vehicles and equipment.
The vehicle replacement reserve currently is maintained to allow for future inflation costs at a rate of
1.5% to 3.5%. For specialized equipment, the rate may exceed this range. Vehicle replacements
amounted to $189,371 in 2009 and $444,489 in 2010. Vehicle replacements for 2011 and 2012 are
budgeted at $912,712 and $615,925 respectively.
A separate replacement reserve for fire apparatus was established in the Equipment Rental Fund in
2007. Beginning in 2008, a 1.65% property tax levy was approved (1.0% optional plus 0.65% banked
capacity) as a dedicated funding source for this purpose. In addition, the difference between the
required annual apparatus sinking fund charge and the property tax levy is funded by interest earnings on
the City’s invested cash. See the Fire Apparatus Replacement Policy for more information.
Budget Policies for 2011-2012
• The useful life of each vehicle and piece of equipment was evaluated, focusing on those that are due
for replacement in 2011-2012, and extended when it was deemed prudent (i.e. low mileage or
equipment hours, good condition, and low maintenance costs).
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures Actual Forecast Budget Budget
Vehicle Replacements $189,371 $444,489 $912,712 $615,925
Fire Apparatus Replacements 120,421 99,580 0 0
Radio Replacements 221,032 79,968 0 0
Total $530,824 $624,037 $912,712 $615,925
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City of Mercer Island 2011-2012 Budget C-57
Budget Policies
_________________________________
C-58 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Development Services
This section includes
budget polices on the
following:
• Development Review
Fees
• Transportation
Management
Budget Policies
_________________________________
C-62 City of Mercer Island 2011-2012 Budget
Budget Policies
Development Review Fees
Background
The authority for cities in Washington to impose fees for development review and permitting is
established and limited by RCW 82.02.020, which allows for “collecting reasonable fees from an
applicant for a permit or other government approval to cover the cost to the city…of processing
applications, inspecting and reviewing plans, or preparing (SEPA documents).”
The ongoing policy of the City regarding building and land use permit fees has been to move towards
recovering the full cost of permitting services, establishing a goal of full cost recovery by 2011-2012. In
a 2009 analysis of DSG activities, staff concluded that 63% of the entire 2008 DSG budget was covered
by revenue from fees and that the rate of recovery was 94.1% for those activities clearly eligible for cost
recovery.
DSG provides a number of services which are either not related to permit review or are indirectly
related. Those services include code enforcement (for activities not directly related to a permit),
mediation and/or resolution of neighborhood disputes and impact mitigation, permit appeals, public
information, and the development and implementation of special projects and programs such as
affordable housing, shoreline planning, Town Center planning, transportation planning, sustainable
development efforts, Mercer Island School District planning, emergency planning and disaster response,
and activities required by the State’s Growth Management Act (GMA). These tasks are generally
considered to be costs associated with the general purpose of government. The use of permit fees to
pay for general purpose government costs has been successfully challenged at other jurisdictions within
the state. The 2011-2012 budget assumes at least 65% of the DSG budget is eligible for cost recovery,
with no more than 35% related to the general purpose of government.
The 2009 analysis resulted in small adjustments to the DSG fee schedule and also acknowledged that
continuing efforts should be made to more clearly refine costs eligible for recovery, especially for the
“indirect costs” for legal, facility and financial services provided by other city departments which directly
support the permitting function.
Development is cyclical in nature. Development activities, fees and the sales and real estate taxes
generated by those activities, change from year to year with the ups and downs of the economy. In
addition, many development projects are not completed within a single year, with some taking many
years to complete. Staffing and outside consultant resource levels must be carefully increased or
decreased to respond to these swings in activity if expected levels of customer service and fiscal
responsibility are to be maintained. When the workload exceeds resource capacity, customer service
may suffer. Applicants may experience delays in permit times which can add significantly to the cost of
development. When the workload is lower than resource capacity, customer services may improve in
the short term, but the revenues anticipated for funding the budgeted capacity may be less than
expected, and resource reductions may be required.
Following the 2004-2007 boom years, aggressive real estate activity came quickly to an end during the
later part of 2008 and throughout 2009, with both workload and revenues in decline. DSG responded
to this slowdown by reducing staff and nearly eliminating outside consultant plan review. In 2010, there
are some signs for optimism. During the first half of 2010, the number of permits and the fees
generated by those permits improved relative to 2009. DSG now faces the challenge of scaled back
resources (workforce and outside consultants) with an increasing workload at the same time that the
City’s General Fund is lagging. It is essential to maintain adequate resources to handle a forecasted
_________________________________
City of Mercer Island 2011-2012 Budget C-63
Budget Policies
increase in permit activity during 2011-2012. When permit approvals are delayed as a result of longer
processing times, there is a corresponding impact on the collection of sales tax on a development
project and the addition of “new construction” to the property tax rolls.
In mid-2010, staff conducted a cursory review of the building permit fee methodology. Staff concluded
that one aspect of the building permit fee structure warranted immediate attention. The current fee
methodology assumes that the value of new residential construction is $116 per square foot (SF). This
value is then applied to the total square footage of the construction project, resulting in the calculation
of the building permit fee. The value of $116/SF is very low for residential construction on Mercer
Island. The King County Assessor has declared that the 2008 Mean Assessed Value per SF for all newly
built homes (built between 2000 and 2007) is $258.20/SF. It is not uncommon for actual construction
costs for new residential construction to greatly exceed $300/SF. Staff has concluded that a modest
increase of $26.50/SF (from $116 to $142.50) is justified to support the current level of building permit
customer service. Assuming building permit activity does not increase or decrease significantly from the
first half of 2010, this increase in value/SF should yield about $135,000 in new annual revenue in 2011-
2012.
Development Revenues & Activity
2003 2004 2005 2006 2007
Selected Revenues
Actual Actual Actual Actual Actual
Single Family – New/ Remodel $659,912 $902,426 $927,267 $947,764 $1,009,500
Multi-Family / Commercial 54,512 196,012 376,088 433,000 344,100
Land Use 181,423 162,340 254,029 167,000 231,600
Street Use 58,888 69,915 88,384 51,000 71,000
Storm Drainage 25,990 46,073 45,029 27,450 41,400
Total Revenues $980,725 $1,376,766 $1,690,797 $1,626,214 $1,697,600
2008 2009 2010 2011 2012
Selected Revenues
Actual Actual Forecast Budget Budget
Single Family – New/ Remodel 729,699 $581,792 $698,000 $730,000 $730,000
Multi-Family / Commercial 344,006 270,447 110,000 195,000 195,000
Land Use 132,222 122,487 111,000 116,000 116,000
Street Use 56,940 56,567 50,000 50,000 50,000
Storm Drainage 33,300 19,954 30,000 20,000 20,000
Total Revenues $1,296,167 $1,004,847 $999,000 $1,111,000 $1,111,000
_________________________________
C-64 City of Mercer Island 2011-2012 Budget
Budget Policies
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Type of Work
Act Act Act Act Act Act Act Est Est Est
Conditional Use Permits 2 2 6 1 3 2 0 0 0 1
Design Review-Major 11 7 5 5 9 7 9 2 3 5
Design Review-Minor 23 24 29 34 15 5 17 12 10 10
Deviations 34 43 57 42 50 27 29 30 25 28
Variances 11 14 18 5 6 2 0 1 1 1
Subdivisions / Short Plats 3 3 9 5 6 6 5 3 5 5
Lot Line Revisions 4 5 8 2 2 4 4 4 4 4
Pre-Application Meetings 109 143 149 146 146 115 91 100 100 100
New - Single Family
31 57 66 58 56 33 12 15 18 18
Dwelling
Remodels - Single Family
197 279 285 157 191 137 123 125 140 140
Dwelling
Demolitions - Single
18 41 45 49 46 25 14 18 20 20
Family Dwelling
Commercial / Multi-
63 89 58 13 75 40 54 40 40 40
Family / Other
Total Valuations (in
26.7 93.5 80.1 95.9 86.3 40.2 30.9 75 30 30
millions)
Over-the-Counter 1,896 2,465 2,656 2,609 2,572 2,000 1,028 1,100 1,000 1,000
Code Enforcement Cases 138 144 191 174 173 147 110 120 130 140
Accessory Dwellings 7 6 8 7 6 3 5 3 2 2
Shoreline Permits-Other 23 18 18 23 50 31 29 25 25 25
Shoreline Substantial
15 9 16 10 21 6 1 5 1 1
Development Permits
Total SEPA Reviews 41 26 39 34 43 23 24 16 16 16
Budget Policies for 2011-2012
• Increase basis for residential permit fees from $116/SF to $142.50/SF.
• Growth should pay for growth. The City will seek full cost recovery for all direct permitting activity
and for all appropriate indirect costs.
• DSG should carefully balance resources with workload and maintain sufficient staff (and if needed
outside consultant) resources to maintain the high level of customer service for permit and plan
review. It is especially important to maintain quick permit turnaround times to facilitate
construction which then generates sales tax and property tax revenue.
• DSG’s workload and resources should be carefully monitored to identify any significant changes in
budget assumptions and to take prompt action during the 2011-2012 biennium if warranted.
• A careful analysis of eligible costs and fees should be conducted in 2011 to assure that the City’s
goal of full cost recovery for all eligible permit activities is implemented.
2011-2012 Budget Impact
Noted above in “Selected Revenues” tables.
_________________________________
City of Mercer Island 2011-2012 Budget C-65
Budget Policies
_________________________________
C-66 City of Mercer Island 2011-2012 Budget
Budget Policies
Transportation Management
Background
Recent Transportation Issues
Over the last three biennia, the City Council has increasingly struggled to find policy directions and
financing for a number of local transportation issues. Among recent issues are:
• Residential Street Overlays
• Arterial Street Improvements
• Bike & Pedestrian Plan Implementation
• Shoulder Improvements along the Mercer Ways
• Transit Services north-south (“Jitney” project)
• Traffic Calming – Planning & Implementation
• Transit Oriented Development Planning in the Town Center (i.e. parking)
• Island Crest Way Configuration
• Parking Along the Mercer Ways
Historical & Future Organization of Function
In terms of managing transportation issues, Mercer Island is rather unique in that it does not have a
single “transportation department.” Instead, the City maintains a de-centralized “matrix” organizational
style by spreading and coordinating transportation activities throughout various parts of the
organization, including the Development Services Group (DSG), the Maintenance Department and the
City Manager’s Office. In the 2009-2010 Budget, the City created a Transportation Manager position to
consolidate a number of the transportation-related functions. While this consolidation had some
advantages, it carried a relatively large price tag, funded mostly by the General Fund.
In the 2011-2012 Budget, the General Fund revenue contractions will require significant changes in the
transportation services historically provided by the City. These changes will require that some duties
and tasks be transferred and absorbed by existing City staff, and other tasks and activities will be
deferred until at least the 2013-2014 Budget. There are also resource gaps that may create the need for
some outside professional transportation engineering services for technical review of some large or
complex development proposals.
Funding Trends & Opportunities
The preservation, maintenance and improvement of Mercer Island’s local transportation infrastructure
are core functions of city government. Equally important are the planning, coordination and
collaboration activities with Washington State Department of Transportation, Sound Transit and King
County Metro regarding transportation operations, improvements and investments of regional
transportation operations and investments, especially those within the I-90 corridor. With passage of
Initiative 695 in 1999 and Initiative 776 in 2002, the city’s ability to fund local transportation activities has
been severely constrained. The City experienced the loss of $1.1 million in Motor Vehicle Excise Taxes
and $200,000 in King County Local Vehicle License fees as a result of the two initiatives. The loss of
these dedicated sources of transportation revenue has constrained the ability of the City to fund local
transportation maintenance and improvements and to provide staff to coordinate regional
transportation operations and investments. This has placed greater pressure on the use of limited real
estate excise taxes and gas taxes to support transportation related activities on Mercer Island.
Consequently, the Council has been unable to secure funding for its various transportation priorities.
_________________________________
City of Mercer Island 2011-2012 Budget C-67
Budget Policies
Transportation Benefit Districts
Many cities and counties across the state have been struggling with the same kinds of issues. In
response, the Legislature amended state law in 2005 (RCW 36.73) to allow cities to create a
“Transportation Benefit District” (TBD). This tool authorizes cities and counties to establish a district
with authority to impose new fees and taxes to fund transportation improvements such as maintenance
of and improvements to local transportation infrastructure. A TBD may raise revenue in two ways.
Without voter approval, a TBD may establish an annual vehicle fee of up to $20 per vehicle and impose
transportation impact fees on commercial and industrial buildings. With voter approval, a TBD may
impose increases in property taxes, sales taxes, an annual fee of up to $100 per vehicle and vehicle tolls.
The governing board of a TBD may be a City Council. Cities who have established a TBD include
Shoreline, Lake Forest Park, Olympia, Des Moines and Edmonds. There are 15,000 registered vehicles
in the City of Mercer Island. A $20 vehicle fee would yield about $300,000 in annual revenue for the
maintenance and improvement of Mercer Island’s transportation infrastructure.
Budget Policies for 2011-2012
• Eliminate the Transportation Manager position, and reassign the duties as follows:
o Neighborhood Traffic Customer Service, including traffic engineering, traffic and parking
complaints, traffic counts, signal modifications, pavement markings and implementation of
neighborhood traffic calming would be transferred to and absorbed by the Assistant City
Engineer, Street Engineer and Streets Maintenance Manager in the Maintenance Department.
o The design and implementation of the Pedestrian Bicycle Facilities Plan would be transferred
from DSG and absorbed by the Assistant City Engineer in the Maintenance Department.
o Annual TIP/CIP development would be absorbed by the City Engineer in the DSG.
o Support for the Mercer Island School District Master Planning transportation element would be
absorbed by the City Engineer in the DSG.
o I-90 (R-8A/HOV and Eastlink) would be absorbed by the City Manager’s Office, with technical
and policy support by the DSG.
o Commute Trip Reduction would be absorbed by the Human Resources Department.
o MISD/PEAK Transportation Demand Management Plan Implementation would be absorbed by
the City Engineer in the DSG.
• Activities which would be deferred or managed on an ad hoc basis:
o Development of a Traffic Calming Toolkit.
o Development and implementation of the demonstration project for a Mercer Island Shuttle.
o Pursuit of highly competitive transportation grants.
• Activities which would likely require some outside professional services:
o Detailed evaluation of traffic studies and transportation impacts of large or complex
development proposals to determine appropriate mitigation. This fiscal need may be filled by a
more aggressive use of SEPA authority. This alternative would require developers to assist in
the funding of the SEPA project analysis.
o Management of the City Transportation Concurrency Program.
o Any new City Council transportation initiative.
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C-68 City of Mercer Island 2011-2012 Budget
Budget Policies
• Consider creation of a Transportation Benefit District to create a new funding source for
transportation-related improvements and/or services. A $20 per vehicle fee would generate
approximately $300,000 per year.
2011-2012 Budget Impact
2009 2010 2011 2012
Actual Forecast Budget Budget
Revenue
Transportation Benefit District $ - $ - $ - $ -
Total Revenue $ - $ - $ - $ -
Expenditures
Transportation Manager $ 122,144 $ 127,919 $ - $ -
Total Expenditure $ 122,144 $ 127,919 $ - $ -
_________________________________
City of Mercer Island 2011-2012 Budget C-69
Budget Policies
_________________________________
C-70 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Parks and Recreation
This section includes
budget polices on the
following:
• I-90 Landscape
Maintenance
• Luther Burbank Park
• Parks and Recreation
Financing
• Trees and Urban
Forest Lands
Budget Policies
_________________________________
C-72 City of Mercer Island 2009-2010 Budget
Budget Policies
I-90 Landscape Maintenance
Background
In 1992, Washington State Department of Transportation (WSDOT) completed construction of the I-
90 roadway on Mercer Island. By 1994, the Park-on-the-Lid and other landscaped areas were
completed and incrementally returned to the City for community use and maintenance. By 1998, all the
agreed-upon property landscaped by WSDOT, totaling 80 acres, had been turned back to the City. The
following chart illustrates the transition:
City WSDOT Total
Year Revenue Expenses
Owned Owned Owned
1992 0 8.6 8.6 $41,323 Not Tracked
1993 0 8.6 8.6 $51,372 $43,507
1994 11.3 15.7 27.0 $52,117 $86,934
1995 11.3 15.7 27.0 $101,348 $151,868
1996 25.6 52.4 78.0 $136,816 $175,000
1997 25.6 52.4 78.0 $343,159 $295,322
1998 25.6 53.9 79.5 $331,234 $334,396
1999 25.6 53.9 79.5 $331,387 $324,331
2000 25.6 53.9 79.5 $341,200 $342,485
2001 25.6 53.9 79.5 $353,894 $328,201
2002 25.6 53.9 79.5 $366,802 $356,356
2003 25.6 53.9 79.5 $373,932 $413,081
2004 25.6 53.9 79.5 $386,052 $421,755
2005 25.6 53.9 79.5 $384,700 $407,189
2006 25.6 53.15* 79.5 $391,322 $455,987
2007 25.6 53.15* 79.5 $405,790 $464,380
2008 25.6 53.15* 79.5 $423,112 $483,412
2009 25.6 53.9 79.5 $443,812 $521,482
2010 25.6 53.9 79.5 $441,860 $442,171
* In Q3 and Q4 of 2006 and throughout all of 2007 and 2008, approximately .75 acres were removed from
WSDOT acreage reimbursement schedule due to Era Care’s Aljoya House development and construction
staging.
The WSDOT owns 53.9 of those 79.5 acres and has agreed to compensate the City for maintenance
costs of those 53.9 acres only. The State-owned properties are managed by the City under a lease
agreement that will expire in 2034. The remaining 25.6 acres are owned by the City and were
landscaped and improved by WSDOT during construction of I-90. The City receives no compensation
from WSDOT for maintenance of those 25.6 acres.
_________________________________
City of Mercer Island 2011-2012 Budget C-73
Budget Policies
Early in the negotiations, the City set the goal of maintaining all 79.5 acres of the I-90 property with the
reimbursement funds for 53.9 acres from WSDOT. This goal was based on estimated cost data
available at the time. Revenue from WSDOT will continue throughout the lease period and will be
adjusted for inflation annually with a formula driven by the Consumer Price Index. The revenues are
projected to grow at an average rate of approximately 3% annually.
In 2006, there was a reduction in the reimbursement by WSDOT for a modification to the lease
agreement to account for reduced City maintenance costs associated with the construction of ERA
Care Communities’ Aljoya House, a senior retirement facility at 2430 76th Avenue SE and adjacent to
the I-90 Park on the Lid trail. ERA Care made significant landscape improvements to a small portion of
the I-90 Lid Park adjacent to the project location in the City’s Town Center. WSDOT negotiated a
reduction of 2.8% to one of the three maintenance agreements included in the total reimbursement to
reflect the reduced maintenance burden on the City. The financial impact of this amendment to the
lease agreement was a temporary reduction in payment to the City by WSDOT of approximately
$4,000 per year.
Over time maintenance costs have increased and the WSDOT lease payment is no longer enough to
cover the costs for maintaining both the States and the City’s portion of the I-90 corridor. As a result,
Parks staff were forced to look at alternative funding sources to supplement the reimbursement the City
received from the State to maintain the current level of service. The City Council ultimately directed
staff to balance expenditures against revenues from WSDOT reimbursement for as long as possible and
then to use the City’s Beautification Fund revenues to cover the shortfall. As the facility ages, Parks staff
anticipate this financial trend to continue, where the costs to maintain the facility at its current level will
exceed the revenue from WSDOT. It will become increasingly necessary to explore options such as
recovering some maintenance costs by increasing I-90 facility user fees (such as boat launch, picnic
shelter, and ball field use fees), finding efficiencies in water and power consumption, or lowering the
level of maintenance to meet WSDOT revenue projections.
Lowering the level of maintenance is a less desirable alternative since public feedback favors the high
standard of appearance for the landscaped areas, and the continued heavy use of the athletic facilities
requires high maintenance to keep them safe and playable. Experience with other Mercer Island parks
suggests that deferring maintenance in the short term will result in expensive restoration costs in the
future.
The current maintenance program and budget are designed to meet or exceed the level of care
standards agreed to with WSDOT. These standards are similar to the standards the City adheres to in
its other major park facilities, and are consistent with the expectations of the Island’s park users.
During a detailed level of service presentation in 2000, the City Council agreed that the City’s
presentation standard for I-90 is correct. The presentation goal for the formal landscaped areas is “as
new” condition. As these facilities gain in popularity and use, there will be increased costs for turf
restoration, litter control, graffiti removal, plant and tree replacement, pathway overlays, etc. Any
further development, such as additional restrooms and ballfields will require additional funding in order
to provide adequate maintenance service and to provide the current presentation standard. As the
facility ages, it will be necessary to address the issues of restoration of the restroom and the picnic
shelter, turf renovations, irrigation infrastructure, major tree pruning, fertilizing and replacement, and
pruning or removal of other vegetation that becomes overgrown.
The maintenance management strategy for the I-90 facility includes a combination of seasonal and full-
time staff labor. Full time Park Maintenance staff is used for mowing, trimming, pruning, edging, and
chemical applications. Seasonals are used for weeding, shrub pruning, and leaf removal. Seasonal and
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full-time City staff operate and repair the irrigation system, inspect the facility, maintain ballfields and
shelters for use, and provide other basic maintenance at a heightened level of supervision.
Budget Policies for 2011-2012
• Limit the growth in expenses to operate the facility relative to the reimbursement from the State.
• Seek additional efficiencies in water and power consumption.
• Consider lowering the level of maintenance in some the I-90 facility areas only where little or no
public reaction will be anticipated.
2011-2012 Budget Impact
2009 2010 2011 2012
Actual Forecast Budget Budget
Revenues
WSDOT Revenues 443,812 444,120 447,895 451,000
Business & Occupation Taxes 77,670 98,051 42,513 46,626
Total Revenue $521,482 $542,171 $490,408 $497,626
Expenditures
I-90 Landscape Maintenance 521,482 542,171 490,408 497,626
Total I-90 Landscape Expenditures $521,482 $542,171 $ 490,408 $ 497,626
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C-76 City of Mercer Island 2011-2012 Budget
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Luther Burbank Park
Operation, Maintenance and Park Master Planning
Transition and Start-Up Under City Ownership
Control of Luther Burbank Park passed to the City on January 1, 2003. Initial City operation mirrored
the final years of King County operation. The City’s intention was to protect public safety and maintain
general security.
During the initial period of transition and start up, covering 2003, $240,000 in maintenance and
operation (M&O) costs were funded from the Capital Reserve Fund, a “one-time” revenue source. The
City tightly controlled costs and resisted expanding programs or maintenance until capital reserves
could be replaced by a stable and ongoing revenue source. Through the first year of City operation
management options and operating costs were carefully assessed under different level-of-service
scenarios.
Direct experience during the first year of City operation enabled staff to more accurately estimate the
costs of improvements and ongoing maintenance. Certain areas of the park required a higher level of
maintenance than others and use patterns varied throughout the facility. Based on this information,
Council selected modes of operation and levels of service considering Island residents’ interests, the
City’s Park Management and Budget Policies, and other opportunities and demands on the City budget.
Upon receiving direction from Council, staff prepared a multi-year capital improvement plan and an
estimate of annual operating costs. These budget projections were used to prepare proposals for
funding ongoing Luther Burbank costs into the long term future – a property tax levy proposition. Past
guidance and policy action embraces the notion that when the City has taken on a major new asset,
stable ongoing revenue sources are needed to support them. Staff estimated ongoing operations and
maintenance at $300,000 with an additional $100,000 needed each year in minor capital repairs and
replacements. Upon further discussion, an additional $15,000 per year for Upper Luther Burbank Park
was added for operations and maintenance. In September 2003, the City Council directed that the
question of new revenue in the annual amount of $415,000 for the specific purpose of paying for existing
and future expenses for a period of six years to maintain and operate upper and lower Luther Burbank
Park at prescribed levels of service be placed before Mercer Island voters. In November 2003, voters
approved this property tax levy increase and in 2004 staff increased their maintenance frequencies to
high impact areas of the park and pursued the implementation of the capital maintenance and repair
plan.
Public Involvement Planning
In addressing the long-term plan for the park, Council directed that a sequential and thoughtful process
be undertaken. Future funding for substantial capital investment in new facilities and the question of
generating ongoing revenue for park maintenance and operations was to be sought only after a thorough
review of private and public funding alternatives and only after Mercer Island citizens have had an
opportunity to comment on a vision for the future of the park.
During its 2004 Retreat, Council considered how best to undertake planning for the future of Luther
Burbank Park. Council agreed to employ the services of an outside expert to design and implement a
thorough public involvement process. The goal was to engage a public involvement expert in 2004 and
conduct the public process before 2006. These accomplishments would then allow the subsequent
“master planning” of any desired improvements to the park to be completed in time to design, permit
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City of Mercer Island 2011-2012 Budget C-77
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and potentially construct by 2009 (when the current Luther Burbank Operations and Maintenance Levy
expires).
Planning for Luther Burbank Park began in November 2004 with a Community Visioning Process which
was used to gather input on the public’s visions and priorities for Luther Burbank Park. To set the stage
for this community effort, the City Council established a number of planning parameters that served as
firm guidelines throughout the process.
Public Involvement
A public involvement plan was developed to serve as a road map for how the Mercer Island community
would be involved in the visioning process. The public involvement goals, included:
• Provide a wide range of opportunities for diverse interests to be informed about and involved in
the development of community design guidelines for Luther Burbank Park.
• Provide the Mercer Island City Council with a comprehensive understanding of the community’s
visions, values and priorities for Luther Burbank Park.
• Create a sense of community cohesiveness and ownership in Luther Burbank Park, making the
transition from a County Park that just happens to be located on Mercer Island to a park that all
Mercer Island residents can feel truly proud of.
The result of the community visioning process was the development of a set of 15 community design
guidelines that were then used to set the stage for the longer-term master plan process:
1) Preserve the existing serenity of the park.
2) Protect and enhance the shoreline experience.
3) Protect and enhance wetland areas.
4) Preserve existing historical and cultural resources.
5) Rehabilitate the swimming beach.
6) Expand court usage.
7) Maintain and improve the existing meadow.
8) Provide for an off-leash dog area.
9) Revitalize the dock area.
10) Expand and enhance activities for children.
11) Consider new picnic facilities.
12) Explore opportunities for new seasonal food vendors and special events.
13) Create a greater ease of connection with Upper Luther Burbank.
14) Create a greater ease of connection with the new community center.
These guidelines were developed over a three month period from November 2004 through January
2005 and included three public workshops as well as numerous written and emailed responses. The
City Council approved the Guidelines on February 7, 2005.
Park Master Planning
The City Council then initiated a Master Planning Process for Luther Burbank Park on September 6,
2005. Guided by the results of the Community Visioning Process, three discrete planning phases were
developed: 1) Information Gathering/Concept Design Development; 2) Review of Concept Designs; and,
3) Review of Preferred Concept Design.
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A public involvement program was developed to provide for multiple and varied opportunities for public
involvement and input. The eight-month long master planning process included 15 opportunities for
public involvement including one in-park public workshop, seven small group work sessions, two town
hall-style meetings and five City Council meetings (four of which had public hearings). Throughout the
entire process, citizens were also encouraged to submit their comments by mail, email or fax.
The first phase, an inventory and analysis, assessed physical conditions of the site, as well as existing and
future program opportunities. A kick-off to the master planning process occurred with a public
workshop in the park where participants were asked to provide input on how the community design
guidelines might be implemented. Information gathering included first hand observation, input from Park
representatives, and site review with shoreline and wetlands ecologists. Included in this phase were a
wetland reconnaissance, shoreline assessment, and permitting review. A series of five small group
sessions were conducted regarding the Off-Leash Dog area; the Dock Area/Small Boat Facility; Shoreline
Restoration; Connections to Upper Luther Burbank and Children’s Opportunities in the Park. Based on
this inventory and analysis, three preliminary master plan concepts were developed for the site and
presented at a City Council meeting and community Town Hall for review and comment. Two
additional meetings with Mercer Island teens were conducted to seek greater involvement from youth.
In the next phase, these plans were consolidated into a preferred Master Plan concept based on
feedback received during the initial presentation. This preferred plan was again presented in a second
Town Hall meeting and presentation to the City Council. The design was honed again to reflect these
comments, resulting in a final master plan design. This master plan report includes plan graphics,
description of the design elements and cost allowances for its implementation.
The master plan design has been completed to an adequate level of detail to identify proposed
improvements and assign costs and priorities. More specific design remains as elements of the master
plan are pursued, during which more cost details can be generated.
Master Plan Implementation- Preliminary Projects and Programs
A more significant and high priority project identified in the Master Plan was the restoration of the
shoreline. As part of its Six Year Parks Capital Improvement Program, the City completed a $1.3
million shoreline and off-leash area renovation project in December 2009. The Shoreline project added
woody debris and spawning gravel along the shoreline for bank stabilization, removed non-native plants,
planted native trees and shrubs, and installed a split rail fence. New designated shoreline access points
have been created.
Improvements to the Off Leash Area were also conducted that included non-native plant and vegetation
removal, surface grading, new under drainage, added sand surfacing, wetland enhancements, landscaping
improvements, new gravel and asphalt pathways, new fencing and gates, and added park furniture.
In addition to the shoreline and off leash area improvements, the Boiler Building and dock facility was
transformed into a boating, sailing and kayaking instructional area focused on orienting youth, adults and
families to water based recreation activities. New windows and doors were installed on the Boiler
Building, in addition to new coats of interior paint, and the installation of new colorful interior banners.
The restrooms in the dock area, previously shuttered, were re-opened in Spring 2010. A low elevation
floating dock was constructed to support the water based recreation programming.
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Funding Ongoing Operations and Maintenance
Mercer Island City Council approved ordinances which placed two parks measures on the November 4,
2008 ballot. Mercer Island voters approved a $900,000 per year park operations and maintenance levy,
but rejected a $12.0 million capital levy to fund park capital improvements such as continued Luther
Burbank shoreline restoration and ballfield improvements.
The failed Parks Bond included funding for shoreline restoration and other improvements at Luther
Burbank Park, ballfield improvements, trail development, development of a small dog off-leash area,
swim beach improvements, and Mary Wayte Pool improvements.
The Parks Operations & Maintenance Levy for $900,000 per year includes funding for open space and
forest restoration and school related park and recreation activities. The 15-year Parks Operations &
Maintenance Levy replaces the previous 6-year Luther Burbank Park levy approved by voters in
November 2003.
Budget Polices for 2011-2012
• For 2011-2012, Luther Burbank Park maintenance and operations will be funded by the 2008 Parks
M&O levy lid lift. Of the total levy amount in 2011 and 2012, $366,287 and $373,631 respectively is
dedicated to Luther Burbank Park maintenance and operations. Minor capital projects at Luther
Burbank Park are also funded at $110,000 per year.
• Pursue approved Capital Improvement Plan projects for Luther Burbank Park.
• Continue routine, preventative, special response and capital maintenance activities to ensure
grounds, buildings and infrastructure will remain serviceable, functional, and safe for park users and
neighbors.
• Pursue vegetation management activities, including wetlands restoration, invasive plant species
removal, and re-vegetation and re-planting activities.
• Prevent and mitigate hazards to public safety and security through active and passive measures such
as improved lighting, routine inspections, police vehicle, bike, boat and foot patrols and park checks.
• Park grounds will remain available to individual and group users at a scope and scale similar to that
under County management in 2000-2002.
• Insure the public’s life safety by providing beach lifeguards through the summer swim season.
• Continue to support boating, sailing (the “handkerchief fleet”) and kayaking programs and other
aquatic recreation activities at Luther Burbank Park.
2011-2012 Budget Impact
2009 2010 2011 2012
Operations and Maintenance Actual Forecast Budget Budget
Revenues
Property Tax levy $370,000 $370,000 $370,000 $378,820
Total Revenue $370,000 $370,000 $370,000 $378,820
Expenditures
M&O Luther Burbank $398,632 $374,720 $366,287 $373,631
Total Expenditures $398,632 $374,720 $366,287 $373,631
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C-80 City of Mercer Island 2011-2012 Budget
Budget Policies
Parks and Recreation Financing
Department Financing
The Park and Recreation Department’s operations have historically been funded from a variety of
sources, including user, program and special event fees, grants and sponsorships, rental and lease fees, as
well as a number of independent Funds including General, Beautification, I-90 Landscape Maintenance,
and the Luther Burbank Park Levy. Financing of administration and recreation services has relied on a
balance between user fees/charges and contributions from the General Fund (46%-50% cost recovery),
while park maintenance services have relied on contributions from all of these Funds. This financing
strategy continues to guide the Department’s budget development.
With an anticipated Council adoption of a revised Parks and Recreation Plan in late 2006, the
Department will become eligible for State and recreation matching grants to assist in the acquisition and
development of parks and facilities. When obtained, such grants will relieve the Capital Improvement
Program and leverage Real Estate Excise Tax (REET) funds to a greater degree. As the City celebrates
significant milestones in opening the new Community Center at Mercer View, new open space and trail
improvements and adoption of a Luther Burbank Park Master Plan, attention shifts to maintaining and
preserving these assets in an economically feasible manner that can be financially and operationally
sustained over time. Staff also continues to be mindful of changing community trends, with calls for
more programs and services to meet preschool and senior needs, expanded beach/aquatic
opportunities, acquisition and preservation of open spaces as well as more access and use of the
community’s ballfields and athletic venues.
As part of the Capital Improvement Program (CIP), staff has identified and budgeted project
management costs in each Parks project. Administrative and operations staff will be relied on to manage
park planning, improvement and construction projects.
Ballfield Use and Scheduling
A policy review committee, comprised of Ballfield User Group members and Parks staff, analyzed issues
such as residency, field maintenance services, and seasons of play. This process resulted in a greater
understanding between users and a field use policy that reflects the current culture of Mercer Island
sports. Implementation of policy revisions began in 2008, with additional elements implemented in 2009.
A proposed field rental fee structure will be implemented in 2010 for all ballfield user groups to help
maintain and replace field turf.
The renovation of the South Mercer All Weather Field to an artificial field turf surface with upgraded
lighting in 2007 has resulted in an increase in use and user fees at that facility. In 2010, the South
Mercer Playfields were renovated to artificial turf infields that will result in more play without the
possibilities of rain-out cancellations. Fees for the newly renovated artificial turf fields at South Mercer
are set and monitored in order to recover the cost of field replacement at the end of its useful life
(estimated at 12 years).
Community Center Operations
The Community Center at Mercer View has been embraced by the community and customers and has
also established itself as the center of indoor recreational and meeting activity on Mercer Island. The
primary function of the center is still to provide a wide range of options for the community. These
options include unstructured drop-in opportunities (open gym, drop-in sports, games, library services,
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fitness room/equipment, internet computer stations, game room, and lounges), meeting room availability
to rent for special events and business meetings (business and community meetings, weddings,
receptions, etc.), structured recreation programs and services (preschool, youth, adult, senior, arts,
fitness, enrichment, social services, sports, etc.) and a host-site to numerous community events (Rotary
Run, MI garage sale, Leap for Green, etc.).
During the original planning process for the new CCMV, a commitment was made to operate the new
expanded facility with no more General Fund tax support than what was realized in the past—namely,
$150,000 per year adjusted annually for inflation as measured by the CPI-W for the Seattle metro area.
Since then, changes to the authorized subsidy level have been driven by revenue policy decisions by the
Council (e.g. establishing a reduced “Community Service” rental fee), by the expansion of operating
hours, and by the need to enhance staffing to address the higher than expected facility usage. During
the 2009-2010 Budget process, the authorized General Fund subsidy level was recalculated based on a
Council approved level of service, resulting in an approved subsidy of $308,000 in 2009 and $321,600 in
2010. Adjusting for inflation, the approved subsidy for 2011 and 2012 are $324,000 and $329,000
respectively.
Since January 1, 2008, the CCMV has generated significant annual revenue increases with 2010 year-end
projections showing a 3-year increase of 65% (or $205,000). The 2011 and 2012 revenues are
projected to be $540,194 and $574,694 respectively. It should be noted that due to the significant
revenue growth (relative to budgeted amounts) the CCMV has consistently operated below the
authorized General Fund subsidy level in 2007, 2008, and 2009, with 2010 projections on target to be
below the authorized level as well. While the CCMV’s overall expenditure line is projected to increase
for the 2011-2012 biennium, the revenue projections for the 2011-2012 biennium are projected to also
increase at a rate to cover these increases, thereby allowing the CCMV to once again operate within the
authorized General Fund Subsidy level for the 2011-2012 biennium.
With the completion of building construction in December 2005 and five (5) years of operations, staff
now has a more accurate assessment of the usage and rental patterns for the Community Center at
Mercer View (CCMV). The customer service, administrative and custodial staffing requirements of the
Community Center to support 7 day/week operations at a level the community expects is significantly
greater than originally anticipated. Staff has proposed a level of operational support that is consistent
with our understanding of the community’s expectations for cost, access, convenience, cleanliness and
service while complying with City business and policy requirements. Accordingly, to properly clean and
maintain the CCMV within the current operating hours and at the current level of customer usage,
custodial budgets need to be increased by $32,100 in 2011 and $34,300 in 2012. These expenditures
will be fully offset by increased revenues, thereby having no impact on the authorized subsidy level.
Also, as the CCMV enters its 6th year of operation, a sinking fund needs to be established to fund the
replacement of CCMV furnishings and equipment. To this end, an annual contribution of $31,000 will
be made from the CCMV’s operating budget in the General Fund to the Technology & Equipment Fund
in 2011 and 2012. Again, these expenditures will be fully offset by increased revenues.
Department Fees and Cost Recovery
The Parks and Recreation Department collects a variety of fees and charges for its services to reduce its
reliance on subsidies from the General Fund. A cost of service and fee analysis was conducted in 2007
to determine the current cost recovery of its recreation programs, ballfield and picnic rentals, special
event permit fees, and community center operations and to identify potential fee adjustments to reflect
its cost recovery goals and policies. The full recreation, administration, forestry, ballfield and community
center user fee cost recovery is 50%, a level consistent over the past 5 biennia.
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C-82 City of Mercer Island 2011-2012 Budget
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In addition, a comparison of select recreation fees and community center rates was conducted to learn
the current fees charged for an equal level of service. The comparison helps to reflect the “market” for
these fees and assists in assessing the reasonableness of the current Mercer Island fees. The comparison
also serves as a benchmark for how cost effectively the city provides its services. The cities of Issaquah,
Kirkland, Bellevue and Renton were analyzed and the findings include:
1) Average fees from the four cities tend to be lower than the charges set by Mercer Island.
2) Kirkland and Bellevue fees are most comparable to those charged by Mercer Island.
The Fee Study confirmed the Department has been recovering costs consistent with past management
and budget policies, namely that cost recovery levels for:
• Adults shall be greater than youth and seniors;
• Youth programs shall be greater than senior programs; and
• Adult sports leagues shall be greater than youth sports leagues.
Increases in labor, utilities and re-allocation of information technology costs have created significant
challenges in controlling Department expenditure growth. In addition, the customer service,
administrative and custodial staffing requirements of the Community Center to support 7 day/week
operations at a level the community expects is significantly greater than originally anticipated. Staff has
proposed a level of operational support that is consistent with our understanding of the community’s
expectations for cost, access, convenience, cleanliness and service while complying with City business
and policy requirements.
Cost recovery continues to be a top priority, and as a result of the recently completed fee study, fees
and charges are budgeted to rise in 2011. Selected highlights of fee increases and operational
adjustments that are anticipated to generate additional revenues include:
• CCMV: In 2010, staff has continued to adjust rental rates and fees to attain consistency and
parity among all rental rates, adjusted room usage scheduling to create more efficient usage of
existing rental inventory, and withheld deposits when rentals exceed contracted times and/or
create additional hard costs for the CCMV operating budget. Also, a successful focus has been
placed on marketing the CCMV to minimize the net subsidy needed as evidenced by current
revenue trends. Another rate analysis will be performed internally to ensure current rates are
at or near fair market value and are consistently applied within each category. Several rate
adjustments are anticipated in the new biennium.
• Facility scheduling: A $4 surcharge will be applied to all facility and ballfield bookings to
recover more of the costs associated with scheduling District and City facilities, including the
Community Center at Mercer View.
• Ballfields: A proposal to introduce field rental fees for Ballfield User Group members that will
help maintain ballfields.
• I-90 Boat Launch: A proposal to increase parking fees from $9 to $11.
• Special Event Permits: Adjusted fee allocation and structure for non-City sponsored special
events in parks (picnics, weddings, rally’s, demonstrations, athletic competitions, etc.), increased
extra charges for after hours staffing, and streamlined minimum rental periods.
These and other collective efforts will assist the Department in more efficiently performing core
functions and recover a greater percentage of costs.
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City of Mercer Island 2011-2012 Budget C-83
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Budget Policies for 2011-2012
Addressing Council initiatives, enhancing revenues and meeting public service demands will be
accomplished through the following:
• Continue to provide basic service levels for existing programs and develop appropriate charges and
cost recovery goals for enhanced levels of service while considering community wide vs. special
benefit, effects of pricing on service demand and feasibility of collection and recovery.
• Cost recovery levels for adults shall be greater than youth and seniors, and youth programs shall
recover more than senior programs and Adult sports leagues shall recover a higher level of costs
than youth sports leagues.
• Implement a non-resident fee for recreation classes and programs which will be higher than the
resident fee.
• Continue to refine the existing rental fee pricing for residents and non-residents, island based
community groups, off-island community groups, and at the Community Center at Mercer View.
• Pursue greater parity regarding cost recovery within each rentals fee categories.
• Meet Community Center facility rental revenue projections of $540,194 in 2011 and $574,694 in
2012.
• Operate the CCMV within the General Fund subsidy of $324,000 and $329,000 in 2011 and 2012
respectively.
• Maintain consistent Community Center staff coverage (2 customer service staff per shift) for
established operating hours of 106 per week, as well as adequate back office staffing levels to
efficiently and effectively manage the CCMV’s overall business and operational needs.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures Actual Forecast Budget Budget
Parks Administration, Recreation & Special
$2,407,078 $2,680,101 $2,471,843 $2,503,873
Programs, CCMV, Arts and Special Events
2009 2010 2011 2012
Revenues Actual Forecast Budget Budget
User Fees $1,131,816 $1,085,315 $1,198,167 $1,226,951
User Fee Cost Recovery 47.0% 40.5% 48.5% 49.0%
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C-84 City of Mercer Island 2011-2012 Budget
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Trees and Urban Forest Lands
Comprehensive Planning
“Open space (trees and green spaces) preservation continues to be a primary activity for attaining the
community's quality-of-life vision. The search for effective new tools and standards to protect and enhance the
environment will be an ongoing focus of City leaders. The community, through its ongoing consideration of public
and private projects, will continue to seek ways of enhancing the Island's quality of life through open space
preservation, pedestrian trails and well-designed and functional public and semi-public facilities.”
Excerpts from the City Council Vision Statement.
As a mature community, Mercer Island has made substantial investments in public infrastructure over
the last 30 years. Given proposed service levels and regulatory controls, additional investments may be
required for open space acquisition, vegetation management and trail development.
Mercer Island has approximately 470 acres of City and State-owned parks and open space lands. This
acreage comprises about 12% of the Island. Eight City parks are equal to or larger than 10 acres. Two
parks exceed 70 acres (Luther Burbank Park and Pioneer Park). On a per capita basis, Islanders enjoy
21 acres of publicly owned park and open space land per 1,000 population. This compares with
neighboring jurisdictions as follows: Bellevue - 20.6 acres/1,000 pop.; Kent - 16.8 acres/1,000 pop.;
Redmond, - 22 acres/1,000 pop.; Kirkland - 11.1 acres/1,000 pop. In addition to City park lands,
approximately two-thirds of the Mercer Island School District grounds are available to Island residents.
And, an additional 40 acres of private open space tracts are available for residents of many subdivisions
on the Island. The Island’s public right of way (ROW) supports a large number of trails and substantial
amount of tree canopy. Nearly 20% of the Island is ROW.
The 2007 Mercer Island Parks and Recreation Plan identifies several objectives that pertain to trees and
open space. These objectives are:
Goal 2: Provide a system of attractive, safe, and functional parks, and park facilities
(partial list).
b) Develop park planning tools and implement long term park/open space management and
park master plans;
c) Retain publicly owned parks and open spaces in perpetuity;
f) Encourage private sector participation in preserving open space and providing facilities for
recreational and community enjoyment;
i) Pursue improvements to developed and undeveloped street ends where appropriate and
where public demand supports new access.
Goal 3: Preserve natural and developed open space environments and trails for the
benefit of all existing and future generations.
a) Promptly investigate open space acquisition opportunities as they become available;
b) Pursue fee simple purchase, transfer of development rights, conservation easements or
other preservation and land use mechanisms that would:
a. enable acquisition of properties where development would create severe hazards to
public health/safety;
b. provide a buffer between incompatible land uses
c. protect ravines and watercourse corridors
d. preserve lands adjacent to or visually accessible from arterials
e. expand existing parks and open spaces or add to an activity node
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City of Mercer Island 2011-2012 Budget D-85
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f. parcel size should be one acre or larger
c) Open space land should offer identifiable benefits to the community that extend beyond
adjacent private properties;
d) Property should not present conspicuous liability risk unless appropriate mitigation can be
pursued;
e) Provide trails that are safe and attractive for pedestrians, bicycles and equestrians and
a. complete and expand the pedestrian, equestrian and bicycle circulation system by
acquiring rights-of-way as necessary and appropriate for trails;
b. Increase the visibility and accessibility of the bicycle, pedestrian and equestrian
circulation system;
c. Develop trail systems within existing open space properties to provide maintenance
and recreational access;
d. enable continuous linkages between employment, transit, schools, parks,
neighborhoods, churches/synagogues and community facilities;
Goal 5: Secure maintenance funding at a level necessary to sustain and enhance parks,
trails and open space.
a) Develop and update long term plans for maintaining parks, trails and open space;
b) Seek City funding appropriations, including Capital Improvement funds, external grants
and gifts to support the City’s adopted Level of Service Standards for parks and to
implement approved park and forest management plans;
Goal 7: Pursue state and federal grant funding for parks and open space improvements.
a) Seek operations, maintenance and capital improvement grant funds to enhance parks,
trails and open space areas.
Background
The citizens of Mercer Island have long regarded trees and the wooded setting of the Island an
important aspect of our community. The City has encouraged preservation and protection of steep
slopes, watercourses, ravines and other environmentally sensitive areas on private and public lands.
These areas help define the sylvan character of the Island.
For open spaces (defined here as all publicly owned open space, including street rights-of-way) to remain
healthy and viable, programs must be developed and funded that ensure trees and other vegetation are
preserved, invasive plants removed, re-vegetation of plants encouraged and when necessary, trees
removed and replaced. In 2001-2002, the City began an active approach toward open space
management. In Pioneer Park, a coordinated capital program of forest management and user
improvements was undertaken. In November 2003, the City Council adopted the Pioneer Park Forest
Management Plan, detailing how the forest can best be managed over time to reach identifiable goals and
outcomes. In October 2004, the City Council adopted the Open Space Vegetation Plan to address the
issues of invasive plants and canopy condition on other public open space properties. This plan has been
implemented as a capital program in 2005 -2006 biennial budgets and has continued through the current,
2009-2010 biennial budget.
Conflicts have arisen for decades over tree cutting, property development and preservation of trees and
vegetation. As economic forces push the Island toward final build out and redevelopment of smaller
homes, the pressure is on the City to effectively define policies and procedures to manage all aspects of
natural resources on the Island. A new tree ordinance adopted by the City Council in early 2002
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D-86 City of Mercer Island 2011-2012 Budget
Budget Policies
provides clear direction for the preservation and management of trees on both private and public
property in the future.
Budget Polices for 2011-2012
• Continue to implement Option 2 in the Open Space Vegetation Plan which provides Level B service
(maintain existing functional value) for vegetation management on 15 open space sites. This would
also continue funding implementation of projects contained in the Pioneer Park Forest Management
Plan.
• Continue to fund a half-time Arborist position for 2009–2010 to support Development Services land
use and regulatory functions. Also continue the half-time Parks Natural Resources Coordinator and
Parks Natural Resources Specialist positions that provides staff support to the Open Space
Conservancy Trust and supports tree and urban forest management in public open spaces and parks.
Fund arborist services and related work for trees in the public right of way through the Maintenance
Department budget.
• Continue tree care and management in rights of way, parks, open spaces and the Town Center at
2007-2008 levels. Fund contractual services for removal of identified tree liabilities in parks and
other open spaces.
• Maintain heightened park maintenance service levels of master planned capital improvements to
Pioneer Park, including trail grooming, brushing, invasive plant removal, re-vegetation, vegetation
control, and park furniture maintenance.
• Continue tree care and vegetation improvement projects in Luther Burbank Park consistent with
ongoing levy and CIP funding support.
• Expand availability of current public education programs (Basin 29 workshops, WSU training
opportunities, EarthCorps/Mountains to Sound Greenway volunteer service learning) to enable
property owners to implement best environmental practices on private open space properties.
• Seek grant funding opportunities to further refine the Urban Tree Canopy Assessment that was
completed in early 2010. This Assessment is the first phase of what is envisioned to be a long-term
effort.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures ($1,000’s) Actual Forecast Budget Budget
General Fund
Arborist – plan review and permitting $ 47 $ 51 $50 $51
Parks Natural Resources Coordinator 44 45 48 50
Total General Fund $91 $96 $98 $101
Right-of-Way tree program 98 126 80 80
Total Street Fund $98 $126 $80 $80
Capital Improvement Fund
Parks Open Space and Vegetation Management 322 553 422 378
Total Capital Improvement Fund $322 $553 $422 $378
Total Expenditures $511 $775 $600 $559
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City of Mercer Island 2011-2012 Budget D-87
Budget Policies
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D-88 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Public Safety
This section includes
budget polices on the
following:
• Criminal Justice Fund
• Fire Apparatus
Replacement
• Fire Prevention
• Jail Services
• Municipal Court
• Police and Fire
Dispatching
• Public Safety
Education /
Emergency
Management
Budget Policies
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C-90 City of Mercer Island 2011-2012 Budget
Budget Policies
Criminal Justice Fund
Background
The Washington State Legislature authorized criminal justice funds to improve the criminal justice
system. In 1990, the City created the Criminal Justice fund to account for this funding allocated to the
Police Department. These funds must be used for criminal justice purposes only and cannot supplant
General Fund expenditures.
The Criminal Justice Fund was originally funded from two different sources. The first was from the
State’s Motor Vehicle Excise Tax (MVET). A total of 2% of the market value of a vehicle was collected
by the state. Of the total collected, the cities received 8.83%, allocated on a per capita basis. However,
with the passage of Initiative 695 in 1999, the Criminal Justice fund no longer receives monies from this
source. The Criminal Justice Fund now relies mainly on the second source of funding which comes from
a percentage of the City’s sales tax (1/10th of 1%). This sales tax revenue was approved by the voters in
King County in 1992. The fund also receives an annual reimbursement from the Mercer Island School
District to help fund the School Resource Officer.
In recent years Mercer Island has received approximately $500,000 per year from this sales tax source.
However, given the current economic recession, sales tax revenues have been lower than anticipated.
This has resulted in a reduction of approximately $100,000 in revenue for the Criminal Justice fund.
The fund continues to sustain some very important programs within the Police Department. The fund
will continue to support the “Hire Ahead” program, which has historically funded two officers (we will
freeze one of these positions for this biennium). It will also support the School Resource Officer who
works very closely with the School District, Youth and Family Services, and the Juvenile Court system.
The Police Support Officer is also supported by this fund, and this program addresses parking
enforcement, leash law enforcement /education, and prisoner transportation. The fund also sustains our
Department’s Bike Patrol Team, Special Operations Team, our training program, computer
replacements, and capital equipment purchases.
Budget Policies for 2011-2012
• Continually monitor the expenditures and revenues in this fund to help assure that the fund
maintains a positive balance.
• Temporarily freeze one “Hire Ahead” officer. This program typically provides two officers for
Patrol, and assists in mitigating some of the staffing shortages and overtime.
• Charge police equipment to a restricted funding source within the Criminal Justice fund.
• Continue to support the School Resource Officer program with additional funding from the Mercer
Island School District.
• Continue to support the Police Support Officer program.
• Continue to support the regional radio system costs which cannot be charged to the levy, such as
radio maintenance and replacement costs.
• Continue to support funding for enhanced police training and equipment.
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City of Mercer Island 2011-2012 Budget C-91
Budget Policies
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ - $ 269,187 $ 63,562 $ 63,916
Washington State Sales Tax 448,547 425,000 438,000 456,000
State Shared Revenues 31,266 28,160 27,750 27,750
Intergovernmental - School Dist 18,054 18,000 18,000 18,000
Grants & Donations 215,282 9,999 - -
Federal Equitable Share of Seizures 13,985 - - -
Total Budgeted Resources $ 727,134 $ 750,346 $ 547,312 $ 565,666
Not Budgeted
Beginning Fund Balance (Reserved) 756,202 548,270 484,708 420,792
TOTAL RESOURCES $ 1,483,336 $ 1,298,616 $ 1,032,020 $ 986,458
USES
Budgeted
Administration $ 22,731 $ 9,999 $ - $ -
Police Support Officer 83,691 85,478 90,488 92,607
Computer Replacements 85,717 85,717 109,854 109,854
Regional Radio & Replacements 52,862 38,587 32,729 33,766
Special Operations/Bike Patrol 14,465 16,400 16,400 16,400
Hire Ahead Positions 54,467 188,368 91,313 97,773
School Resource Officer 108,475 120,396 107,336 115,866
Police Training 48,252 67,680 60,192 60,400
Domestic Violence 10,000 10,000 10,000 10,000
Police Equipment 29,000 29,000 29,000 29,000
Interfund Transfer 156,220 98,721 - -
Total Budgeted Expenditures $ 665,879 $ 750,346 $ 547,312 $ 565,666
Not Budgeted
Ending Fund Balance 817,457 548,270 484,708 420,792
TOTAL USES $ 1,483,336 $ 1,298,616 $ 1,032,020 $ 986,458
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C-92 City of Mercer Island 2011-2012 Budget
Budget Policies
Fire Apparatus Replacement
Background
In 2007, the City Council authorized the implementation of a fire apparatus replacement plan, which
included some upfront capital replacement funding and an ongoing 1.65% dedicated property tax levy
(1.0% optional plus 0.65% banked capacity), supplemented by interest earnings as needed to cover the
difference between the required annual apparatus sinking fund charge and the property tax levy.
In 2007-2008, Phase 1 of the apparatus replacement program was completed. This included the sale of
the Fire Department’s Aerial Ladder Truck, the acquisition of two new Pierce Velocity Pumpers, the
acquisition of one new Pierce Mini Pumper, the sale of two of the existing Emergency One Pumpers, and
the purchase of one Ford Pick-up truck.
In 2009-2010, Phase 2 of the apparatus replacement program will be completed. This includes the
acquisition of one used Maxi Pumper, the sale of the remaining two Emergency One pumpers, and
entering into an interlocal agreement with Eastside Fire & Rescue to share a fourth Maxi Pumper.
Regarding the latter item, the Fire Department has been actively engaged with Eastside Fire & Rescue in
the development of a shared reserve apparatus program. This program is based on the apparatus
rotation cycle adopted by Council. The objective of the shared apparatus program is to reduce Mercer
Island Fire Department’s fleet of four maxi engines to three. This agreement should be in place before
the end of 2010. The Fire Department will also explore the opportunity to share other similar
apparatus such as command units and aid units with the goal of reducing our self reliance on a reserve
pool.
Budget Policies for 2011- 2012
• No apparatus replacements are scheduled in 2011-2012.
• Apparatus design committees will conduct analysis and design processes in 2012 for the scheduled
replacement of a maxi engine and a rescue vehicle in 2013 (i.e. place manufacturing order in 2012
and take delivery in 2013).
• Continue apparatus fleet analysis, looking for opportunities to economize fleet size, such as forming
partnerships with other fire agencies to share reserve pumpers.
• Continue to monitor technology development relative to sustainability.
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Revenues:
Property Tax $148,446 $148,446 $148,446 $149,930
Interest Earnings 46 0 0 0
Proceeds From Sale of Apparatus 5,580 0 0 0
Total Revenues $154,072 $148,446 $148,446 $149,930
Expenditures:
Capital Purchase $150,555 $0 $0 $0
Capital Lease (Principal & Interest) $165,745 165,745 165,745 165,745
Total Expenditures $316,300 $165,745 $165,745 $165,745
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City of Mercer Island 2011-2012 Budget C-93
Budget Policies
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C-94 City of Mercer Island 2011-2012 Budget
Budget Policies
Fire Prevention & Code Enforcement
Background
The Mercer Island Fire Department has the legal responsibility to provide fire, medical, prevention, and
educational services to the Mercer Island community, as defined by the Mercer Island City Council
through City Ordinance. Historically, Mercer Island has delivered Fire Prevention, Education & Code
Enforcement services through the Fire Department and specifically the Fire Marshal position.
Since 1962 Mercer Island’s Fire Marshal has been a 1.0 FTE. However, after the retirement of Fire
Marshal Ed McKinney in 1995, the duties and responsibilities of this position were carried out by part-
time employees. The position was subsequently reaffirmed as an FTE, though the position was modified
to be a contracted position instead of a permanent position. This has been the model that has been in
place since 1997.
At the direction of the City Manager and as part of the budget development process, an assessment of
the duties, responsibilities, and authorities of the Fire Marshal position was completed. The fundamental
question that was asked was: could these responsibilities and duties be delegated to other existing
positions within the City, thereby helping to reduce the City’s financial liability? The assessment
concluded that they could not, because there was no additional capacity in Development Services.
What was recommended and incorporated into the 2011-2012 Preliminary Budget was a 0.25 FTE
reduction in contracted hours (reducing the position to a 0.75 FTE).
During its 2011-2012 Budget deliberations, the Council directed staff to make additional staffing
reductions beyond what had been proposed in the Preliminary Budget. As a result, the City Manager
recommended eliminating the Fire Marshal position, with the plan review responsibilities being shifted to
Development Services staff. The Council approved this staffing reduction.
Budget Policies for 2011-2012
• Eliminate contract Fire Marshal position (1.0 FTE) beginning in 2011.
• Shift Fire Code plan review responsibilities to the Building Code plan reviewers in Development
Services beginning in 2011. Fire Department staff will assist Development Services with operational-
related issues.
• Contract out specialized Fire Code technical issues.
• If development activity increases significantly beyond what is forecast for 2011-2012, staff will return
to Council asking that the position be re-instated, with the funding source being development-
related revenues.
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City of Mercer Island 2011-2012 Budget C-95
Budget Policies
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Estimate Budget Budget
Revenues
Permit Fees $ 28,389 $ 34,000 $ 57,050 $ 57,050
Total Revenue $ 28,389 $ 34,000 $ 57,050 $ 57,050
Expenditures
Salary and Benefits $ 112,799 $ 115,317 $ 13,576 $ 15,500
Contract Services - - 18,000 19,000
Other operating costs 8,652 5,900 2,350 4,050
Total Expenditure $ 121,451 $ 121,217 $ 33,926 $ 38,550
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C-96 City of Mercer Island 2011-2012 Budget
Budget Policies
Jail Services
Background
Under state law, the City of Mercer Island is responsible for paying all costs associated with
incarcerating offenders for violations of misdemeanor crimes. The City currently has three separate
contracts for jail services which include the Yakima County jail, the Issaquah city jail, and the King
County jail. The contract with the Yakima County jail is for four beds and is set to expire at the end of
2010 (we do not plan on renewing this contract). The contract with the Issaquah city jail is for two
beds, which we will reduce to 1 bed beginning in 2011. We use the Issaquah jail for the majority of our
misdemeanor bookings. The contract with King County does not include a bed commitment, and is for
all felony bookings and for those misdemeanants who have significant medical issues that preclude them
from being accepted at the Issaquah City Jail. The state pays for all felony bookings, while we pay for
our misdemeanor bookings.
Budget Policies for 2011-2012
During the 2011-2012 biennium, the City will take the following actions to best manage the City's jail
costs and jail populations:
• We will not renew our contract with Yakima County for jail services.
• We will reduce our contract with Issaquah city jail from two beds to one.
• We will no longer book into jail many of our low level, low risk misdemeanant offenders.
• The City will continue to explore options for alternatives to incarceration for eligible offenders.
We currently contract with the Renton Electronic Home Detention Program.
2011-2012 Budget Impact
2009 2010 2011 2012
Description
Actual Forecast Budget Budget
Revenues:
General Fund $155,849 $174,000 $54,985 $57,695
Total Revenues $155,849 $174,000 $54,985 $57,695
Expenditures:
Jail Costs $155,849 $174,000 $54,985 $57,695
Total Expenditures $155,849 $174,000 $54,985 $57,695
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City of Mercer Island 2011-2012 Budget C-97
Budget Policies
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C-98 City of Mercer Island 2011-2012 Budget
Budget Policies
Municipal Court
Pursuant to state law, Mercer Island is required to provide court services by (1) forming its own
municipal court; (2) forming a municipal department within the King County court system; or (3)
contracting with King County for delivery of court services. After considering a proposed new King
County court contract, the City Council directed staff to proceed with formation of a Mercer Island
Municipal Court to be operational on January 1, 2005. The City Council also approved an interlocal
agreement with Newcastle for the delivery of court services commencing January 1, 2005.
It is important to note that the court’s responsibility does not end with the caseload filed in that
calendar year. In most cases, the court has jurisdiction over criminal cases for two years. For DUI
matters, jurisdiction continues for five years. The Court continues to manage court cases, hold court
hearings, and monitor cases for compliance with conditions until the end of the jurisdictional period.
In 2008, the Court’s caseload has increased significantly to the point where staff was unable to take
adequate breaks during the work day, to attend needed training, and to stay current in submitting unpaid
tickets and probation fees to collections. This conclusion was independently confirmed by Prothman
and Company, which compared Mercer Island to three other jurisdictions (Bothell, Des Moines, and
Issaquah) in terms of 2007 new case filings and authorized FTE’s, as noted in the table below.
Traffic Non-Traffic Traffic Non-Traffic Total Cases Per
City Parking DUI FTE’s
Infraction Infraction Criminal Criminal Cases FTE
Mercer Island 2,592 166 709 48 185 82 3,782
Newcastle 448 0 10 8 81 26 573
Total 3,040 166 719 56 266 108 4,355 2.0 2,177.5
Bothell 3,227 41 300 145 657 418 4,788 3.5 1,368.0
Des Moines 3,293 166 377 44 447 425 4,752 4.0 1,188.0
Issaquah 2,730 7 414 89 358 374 3,972 4.5 882.7
As a result, the Council approved the addition of a temporary, full-time Court Clerk in September 2008,
which was converted to a regular, full-time position beginning in 2009. Through 2009, the fines and
forfeits generated by the court have been more than sufficient to cover the ongoing cost of Court
operations, including the addition of another Court Clerk. In 2010, however, it is projected that the
Court’s expenditures will exceed its revenues by about $63,000. This is wholly due to a significant drop
in the number of case filings, which are down 3.1% in 2010 compared to 2009.
Below are the total actual new case filings for Mercer Island and Newcastle for 2008-2010.
Traffic Non-Traffic Traffic Non-Traffic Total
Year Parking DUI
Infraction Infraction Criminal Criminal Cases
2008 3,134 110 542 64 324 168 4,342
2009 2,691 161 363 49 360 171 3,795
2010 2,798 115 268 58 313 127 3,679
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City of Mercer Island 2011-2012 Budget C-99
Budget Policies
Budget Policies for 2011-2012
• The addition of a full-time Court Clerk in 2009 helped address the heavy caseload issue and court
fine collection backlog which plagued the Municipal Court in 2007-2008.
• With the reduction in caseload in 2009-2010 relative to 2008 and with court revenues projected to
significantly trail court expenditures in 2010 for the first time since its inception in 2005, it was
determined that the Court Administrator position could be reduced to half-time in 2011-2012 with
no impact on necessary reporting and accounting functions and no visible change to the public in the
level of service. The Court Clerks will backfill for Court Administrator functions as needed.
• It is expected that court revenues will cover all court costs on an annual basis, which was the
assumption on which the City opened its Municipal Court in January 2005.
• Continue to provide municipal court services to the City of Newcastle via the current interlocal
agreement.
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Fines & Forfeiture Revenues $390,425 $370,000 $394,000 $394,000
Total Court Operating Costs $387,813 $433,134 $355,073 $367,157
Net Revenues (Costs) $2,612 ($63,134) $38,927 $26,843
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C-100 City of Mercer Island 2011-2012 Budget
Budget Policies
Police and Fire Dispatching
Background
From 1960 to 2004 Mercer Island operated its own Police/Fire dispatch center. Beginning in 2004
through 2009 Mercer Island received Police and Fire dispatching services from the cities of Kirkland and
Bellevue respectively. In July 2009, the new North East King County Regional Public Safety
Communication Agency (NORCOM) became our service provider for both Police and Fire dispatch
services. Costs are shared by the stakeholders based on call volume, with Mercer Island’s share being
5.8% of the total costs.
NORCOM provides dispatching services for 5 Police Departments and 14 Fire Departments. They
answer approximately 174,000 calls for service each year (114,000 police calls and 60,000 fire / EMS
calls). Mercer Island is responsible for approximately 12,000 of the police calls, and 2,400 of the Fire /
EMS calls each year.
Budget Policies for 2011-2012
• Continue to work with NORCOM to ensure our citizens and public safety employees are receiving
a high level of service.
• Work with Records personnel to ensure they provide the appropriate level of service to our
citizens.
• Continue to ensure that our Mobile Computer systems in our emergency vehicles are well
maintained.
• Continue our active participation in NORCOM committees, with a particular focus on ensuring
efficiencies are maximized.
2011-2012 Budget Impact
2009 2010 2011 2012
Expenditures
Actual Forecast Budget Budget
NORCOM Police Dispatch Operating $357,974 $487,578 $407,427 $419,650
NORCOM Fire Dispatch Operating $114,443 $117,604 $138,462 $142,616
Total Expenditures $472,417 $605,182 $545,889 $562,266
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City of Mercer Island 2011-2012 Budget C-101
Budget Policies
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C-102 City of Mercer Island 2009-2010 Budget
Budget Policies
Public Safety Education/Emergency Management
Background
Mercer Island has had a very strong Emergency Management program, which began in 1991. The
program’s objective has been to help make Mercer Island a disaster resistant community. City staff,
Mercer Island School District staff, and private businesses work together with volunteers from the
community toward the programs objectives.
In 1995, the City hired its first full-time Emergency Preparedness Coordinator. Over the span of the
next 11 years, the City employed a full-time employee to fill the role of Emergency Preparedness
Coordinator. In 2006, the Fire Department assumed responsibility for the Emergency Management
program, and staffed the position with a half-time Emergency Preparedness Coordinator, who was
assisted by the Deputy Fire Chief. In December of 2007, the half-time Emergency Preparedness
Coordinator left the City for a full-time Emergency Management position with another city. In January
of 2008, responsibility for the Emergency Management program was reassigned to the Police
Department, and is now staffed with a full time police officer.
Since 2008, the Emergency Preparedness Officer has completed a variety of projects and tasks to
include:
• Integrating the Mercer Island Business Neighborhood Alliance (MIBNA) into the Emergency
Preparedness program
• Conducting the Sound Shake ‘08 exercise, as well as conducting a comprehensive City staff
practical exercise in 2009
• Completing necessary Emergency Operations Center (EOC) improvements
• Providing public education at such events as Summer Celebration and through community
classes
• Recruiting and training community volunteers and forming action teams
• Updating Emergency Preparedness brochures and the City’s Emergency Preparedness website
• Improving communication strategies with the Ham radio operators (MIRO)
• Updating the shelter program
The new 2011-2012 work plan includes four broad themes/goals which include:
1. City staff will be prepared to activate EOC and shelter facilities for any type of
emergency/disaster.
2. Residents / businesses will be prepared to shelter themselves for 7-10 days.
3. Volunteers will be prepared to assist during serious incidents.
4. An effective communication model will be established between City staff and the community.
Each element of the work plan includes many projects that support the overall goal of having Mercer
Island be self-sufficient during a disaster for up to 7 days. These projects include organizing and
providing continual training for the Mercer Island volunteer response teams, securing generator power
at the Shell gas station, purchasing new shelter containers and necessary supplies, identifying regional
emergency resources, and conducting training sessions/exercises for key stakeholders.
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City of Mercer Island 2011-2012 Budget C-103
Budget Policies
Budget Policies for 2011-2012
• Continue efforts with the community and businesses to be prepared for 7-10 days.
• Continue support training for City staff and community members.
• Continue to develop and support the citizen volunteer groups, the faith community and business
community involvement.
• Designate and supply a south end shelter location.
• Select EOC tracking software and train City staff.
• Continue to focus on preparedness for all hazards.
2011-2012 Budget Impact
2009 2010 2011 2012
Description
Actual Forecast Budget Budget
Revenues:
General Fund $146,625 $160,882 $162,604 $166,780
Total Revenues $146,625 $160,882 $162,604 $166,780
Expenditures:
Salary & Benefits $115,331 $120,048 $122,036 $126,082
Equipment/Supplies/Community Education 31,294 40,834 40,568 40,698
Total Expenditures $146,625 $160,882 $162,604 $166,780
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C-104 City of Mercer Island 2011-2012 Budget
BUDGET POLICES
Youth and Family Services
This section includes
budget polices on the
following:
• Youth and Family
Services Financing
Budget Policies
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C-106 City of Mercer Island 2011-2012 Budget
Budget Policies
Youth and Family Services Financing
Background
Youth and Family Services (YFS) was created in 1973 as a private and public partnership. Public and
private sources of revenue have always been integral to the funding base for the department. In addition
to the City’s General Fund, YFS is currently financed through a variety of other sources. These include
donations from community organizations, individual contributions, Thrift Shop proceeds, grants, MIYFS
Foundation fundraising efforts and contributions, client fees, interest from the Endowment Fund, and an
Interlocal Agreement for Services with Mercer Island School District.
This policy is intended to provide additional detail about these funding sources and provide background
for the proposed 2011-2012 biennial funding changes. The department core staffing pattern will
decrease by 1.0 FTE; comprise of 0.5 FTE Development Officer and 0.5 FTE VOICE Coordinator. A
contract staff position continues to coordinate the Communities that Care Coalition focusing specifically
on reducing underage drinking and prevention of youth at risk behavior. There are no proposed
increases in the Department’s level of services.
Youth and Family Services Fund
Accounting for YFS Revenues and Expenditures are accounted for in a Special Revenue Fund “The YFS
Fund (160)”. The fund was created when cash balances from past donations held in Trust Funds were
transferred to the new fund, providing the beginning cash balance. All revenues, including program fees,
grants, donations, thrift shop sales, general fund support, MIYFS Foundation support, and all YFS
program expenditures are now accounted for within the same fund. Any year end surplus generated is
retained in the fund for future appropriation in support of ongoing YFS department programs.
YFS Permanent Endowment Fund
In 1986, upon the recommendation of the Youth and Family Services staff and Advisory Board, the City
Council adopted Ordinance A-45 defining the “Youth Services Program Enhancement Trust Fund” and
the “Youth Services Endowment Fund”. The ordinance formally established procedures and guidelines
for the expenditure of funds donated to Youth and Family Services.
Direct donations to these funds are tax deductible under the provisions of Section 170 of the IRS Code,
specifically due to meeting the definition of sub-section 115(a) that describes governmental subdivisions.
The YFS Permanent Endowment Fund (061) is comprised of contributions donated primarily by
individuals. Ordinance A-45 established that the principal remains invested, and only the income earned
from the investment of funds is available for expenditure. Interest from the Permanent Endowment
Funds is transferred annually to the YFS Fund to support ongoing programs. For the 2010-12 biennium,
$3,500 is budgeted for 2011 and $3,500 for 2012; these estimates are down considerably from several
years prior.
Thrift Shop Revenue
Thrift Shop (TS) revenue increased significantly in the past biennium. TS staff have increased store
hours and improved store appearance, product selection and regular, early stocking. The Thrift Shop
depends upon an enormous commitment of hours from volunteers. That commitment stems from the
mission focus of raising revenues to pay for programs operated by YFS. The volunteer hours of
community members has remained consistent. This is a change from the preceding nine or so years
when the Thrift Shop experienced a decrease in the amount of volunteer hours donated by the same
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City of Mercer Island 2011-2012 Budget C-107
Budget Policies
number of volunteers. At that time staff hours were increased to maintain the same levels of customer
service and increase the hours of operation. With the current consistent configuration of staffing, the
TS increased days of operation to include Monday beginning in February of 2010. These changes, along
with a focus on store improvements and the implementation updated thrift business practices saw the
last two years finishing with increased revenues. The Thrift Shop brought in net revenues just over
$800,000 in 2009 and is estimated to net over 850,000 in 2010.
The proposed 2011-2012 budget for the Thrift Shop reflects a consistent use of contract and casual
labor hours which allows for the hiring of skilled staff to complement and enhance the work of the
volunteers. The net result has been the execution of many changes at the Thrift Shop and a marked
increase in revenues.
Thrift Shop revenue supports the following priorities of the Youth and Family Services Department:
• Reimbursement of Thrift Shop expenses. This is defined as direct costs that the City would not be
incurring if the Thrift Shop were not in existence.
• Thrift Shop building facility maintenance, operations, and capital improvements.
• Support of YFS programs; for the upcoming biennium the increased TS revenue will compensate for
the decrease in funds from the MI School District for school based mental health services.
MIYFS Foundation
The MIYFS Foundation was created in 1989 to support and expand the human services offered by the
City’s Youth and Family Services Department. It is an independent, private, non-profit legal entity
separate from the City of Mercer Island with its own Board of Directors. The Foundation is eligible for
tax deductible donations, under the provisions of Section 170 of the IRS Code, specifically due to
meeting the definition of Section 501(c)(3), defining private non-profit organizations. It was originally
created in order to be eligible for workplace giving programs and other corporate and foundation funds
that require a 501(c)(3) tax-exempt status for eligibility. The nature of the relationship between the
Foundation and MIYFS is similar to that of a schools foundation and a school district.
The MIYFS Foundation 501(c)(3) raises revenues through a variety of fund raising activities conducted
annually by the board:
• all island fund drive (conducted in the fall)
• school fund drive (conducted in the spring)
• Giving from the Heart breakfast, the Foundation’s signature event, and
• various other smaller community based fundraising endeavors.
In 2009 the Foundation was awarded $75,000 to establish a Youth Endowment Fund to support the
work of the VOICE and SVP community service programs. The Foundation has two other Endowment
Funds that receive donations for Senior Outreach and general funding. Foundation Board members
manage all grant and fund drive solicitation for the MIYFS Foundation.
On-going funding: Each year the Foundation commits to raising a specified amount of funds for annual
YFS general operating expenses. For 2009 and 2010 the Foundation was unable to meet its pledge by
approximately $40,000 as the recession severally affected the Foundation’s ability to raise funds. The
Foundation has established a budgeting process that will provide an estimate of financial commitment to
the YFS department prior to the biennial budgeting process.
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C-108 City of Mercer Island 2011-2012 Budget
Budget Policies
Program Donations
The YFS Fund (160) also receives donations toward programs. Examples include donations for
emergency assistance, scholarships, and donations to the Voice program. General donations to YFS
programs are directed to the MIYFS Foundation. Careful accounting with sub-accounts assures that
funds will be spent according to the donor’s wishes. Funds are used for general operational costs of
existing YFS priority programs; program enhancements, equipment purchases, and miscellaneous service
related expenses.
Budget Policies for 2011-2012
• Funding Basis
Department positions are funded by a funding matrix that includes the City’s General Fund and
several other sources that include the Mercer Island School District, county contracts,
contributions, Thrift Shop revenues, and MIYFS Foundation support. There are no base positions or
privately funded positions except in the case of contracts, grants, or specifically designated donations
or bequests. The YFS Department service configuration is determined by professional protocols for
Human Service planning: regular community needs assessment, best practice research and client and
professional input. The Department director presents to the City Council, through the budget
approval process, the mix of services that would best serve the children, youth, families, adults and
seniors of the community. The department staff and the Advisory Board will provide input to the
Council through YFS Planning processes, the Council Liaison, and direct presentations to the
Council.
• Responsibility to Donors and Volunteers
Contributions from donors shall be used to the maximum extent possible to provide human
services for the people of Mercer Island according to the expressed wishes of the donors. Since the
1970s a unique partnership with community volunteers a revenue stream that allows the City to
fund many YFS programs. The City committed to designate revenue raised by these volunteers
(including Thrift Shop proceeds and fundraising efforts) to be used to pay for programs operated by
YFS.
• Funding Streams 2011-2012
General Fund Contribution: The annual General Fund contribution for the 2011-2012 biennium
will be $320,000 per year. This represents a decrease of $145,000 from the capped amount of
$465,000 established in 2004. In 2009, as part of the City and Department efforts to reduce
General Fund expenses, the cap of $465,000 was permanently lowered by $25,000 to $440,000. To
further help the General Fund in 2011-2012, the General Fund subsidy will be permanently lowered
by another $80,000, which will be replaced by increased Thrift Shop sales activity, and will be
temporarily (for 2011-2012 only) lowered by yet another $40,000, which will be funded by
accumulated cash in the YFS Fund. During the 2013-2014 biennial budget process, the General Fund
subsidy policy will be reviewed again when City revenues are expected to be more stable.
Mercer Island School District: During the 2009-10 academic year the Mercer Island School
District reduced its commitment to the YFS department by approximately $130,000. The current
annual pledged amount of $60,000 no longer pays for half of the cost for six of the seven school
based counselors.
_________________________________
City of Mercer Island 2011-2012 Budget C-109
Budget Policies
King County Community Services Division (potential delay of a three year phase out):
The KC Community Services Division has been the primary supporter of the Youth and Family
Service Association agencies since it’s inception in 1973. From 2000 through the current year
(2010) the Department has received approximately $36,000 per year for general operating
expenses. These funds have been designated to support a portion of the department’s work in the
schools. Over the past five years, King County has been re-evaluating the YFS designation of general
fund use for human services. During the last budget cycle, YFS organizations were informed that
this designated funding would be phased out sometime in the near future. At the time of the 2011-
12 budget development there is no final word on a specific cut to this fund though it is assumed that
these funds will eventually not be available to the YFS entities.
Diversion: This funding of $3,400 is slated to remain steady for the coming biennium though there
will be no increase to cover any increases associated with the salary.
Drug Free Communities Grant (DFC): Communities That Care is a grant funded community
mobilization endeavor that seeks to reduce the level of underage drinking and drug use. YFS
received a five year federal grant from Drug Free Communities that began in January 2008. The
associated staff and expenses for this endeavor are considered short term (through the life of the
grant) and the development officer and the MIYFS Foundation have taken on the responsibility for
developing the funding configuration to sustain this effort. DFC will contribute $76,003 in funding in
2011 and $74,794 in 2012.
• Fundraising and MIYFS Foundation
Since 2007 the Foundation has increased the variety of fundraising activities conducted on behalf of
the department and the amount of money these events raise. In general the Foundation revenues
have increased as have the variety of fundraising endeavors. During the first year of the recession
the Foundation, like most entities requesting money from grant making organizations, was not
invited to write grants for capital funding. At this same time, corporate sponsorship for the
Foundation’s signature event, the “Giving from the Heart” breakfast took a strong dip. After this
initial year of the recession, the Foundation focused its ‘asks’ more on the local community and the
actual number of donors increased though the funds remained flat.
Growth in the Foundation fund raising:
2005
All Island Fund Drive
School Fund Drive
Giving From The Heart Breakfast
Annual Report –enclosed envelop, vehicle donations
Present
All Island Fund Drive
School Fund Drive
Giving from the Heart Breakfast (100% growth in size and revenues)
Annual Report –enclosed envelop, vehicle donations
Turn-key community events
A Taste of Yoga, Holiday Bazaar, the Pumpkin Patch, Glass Heart sales,
Youth Development Endowment
Endowment established 2009
Annual summer letter campaign following summer VOICE and SVP
Local Dollars, Local Youth – Part of an initiative to increase the shopping of MI residents in the
downtown area.
_________________________________
C-110 City of Mercer Island 2011-2012 Budget
Budget Policies
Developed Capacity
Web Site – on-line donations
Donor Appreciation Event – September/October
Raiser’s Edge / Data Management
Cultivation
Planned Giving
Board Development
Developed Community-Partnership fundraising events that are executed by local community
groups with proceeds going to YFS;
Enhanced the existing fundraising activities – each year’s funds drive increased over the levels of
the past years;
Increased the pre-breakfast sponsorships;
Developed a planned giving program; and
Brought in additional grants: Rotary Foundation, Community Fund, Women’s Club.
The Foundation’s 2009-2010 actual funding of $156,000 per year represents an increase over the
past biennial commitment of $120,300 per year. The 2011-12 pledge will remain at approximately at
this level ($183,500 for 2011 and $157,500 for 2012). Funds will be raised through grant writing in
addition to current and new fundraising efforts.
• YFS Fund Balance
The YFS Fund developed a fund balance over a period of years when the Thrift Shop revenues
exceeded what was needed to fund services. This fund balance is being spent down with a
projected end date for use at the end of the 20111-2012 biennium.
Prior to 2004, the City’s General Fund contributed 40% of the YFS department’s budget with
donations, contracts and Thrift Shop revenue making up the remaining 60%. This historical funding
pattern for the department ended in 2004 when the General Fund contribution was capped at
$465,000. This was done so with the recognition that the amount and configuration of services in
2004 reflected the needs appropriate to the community. At that time the Thrift Shop revenues had
been exceeding what was needed to fund up to 60% and the YFS Fund had accumulated some
excess fund balance.
In 2004, to assess the expenses and revenues trends, and most importantly, to determine the year in
which the revenue and expense lines would intersect, a ten year revenue-to-expense projection was
developed. This would be the point at which the YFS operating fund balance would begin to be
drawn down. It was projected that the fund balance would be used in the 07-08 biennium and in the
09-10 biennium.
The City’s General Fund contribution had been the department’s single largest portion of funding.
While this contribution remained fixed, expenses in the following two biennium (in particular health
care and IT) grew at an increasing rate. Additionally other funders reduced their funding to the
department. As a result, expenses grew much faster than revenues and the projections of spending
down of the reserve indicated this would occur within six to eight years.
In actuality, the reserve draw down has been slower than expected due to better than projected
Thrift Shop growth and an effective effort to reduce general expenses. Fund balance use to meet
budgeted expenditures in the 2011-2012 biennium will be $103,414 in 2011 and $150,316 in 2012.
_________________________________
City of Mercer Island 2011-2012 Budget C-111
Budget Policies
Since 2004 the Foundation donations, Thrift Shop revenues and general donations increased steadily.
Even so, these revenue sources represent only about 70% of the overall department budget. The
contribution from the City’s General Fund has not been adjusted since 2004. In order to keep pace
with the cost of living in the coming biennia, the department and the city will eventually need to
reevaluate and adjust proportionately the whole department’s funding formula in order to continue
to provide the full range of services to Island residents.
Current projections of fund balance use indicate that regular ongoing operations will be maintained
in this biennium with a December 2012 ending fund balance of $173,154.
Developing and Expanding Funding Streams
Addressing emergent needs and serving the future community
Given the recent shifts in funding commitments and the decreasing city general fund revenues the YFS
department is exploring options for increasing future revenues to meet the on-going need for funding to
local human services. To this end, two ideas will be piloted in the coming biennium and one additional
funding option is in the exploration process.
1. Beginning this November the Foundation is stepping up its fundraising activities to include a
month long Local Dollars, Local Youth campaign. This campaign is a collaborative project in
partnership with local businesses to raise funds for the four largest youth serving entities on the
Island: Youth and Family Services, Mercer Island Schools Foundation, Youth Theatre Northwest
and the Boys and Girls Club. Shoppers at Island businesses during the month of November will
be given the opportunity to add a dollar onto their bill or tab to support these four
organizations that together touch the lives of every Island youth. It is too early to estimate how
much money this campaign will raise. These four organizations, in conjunction with the
Chamber of Commerce, are planning to have this campaign conducted each November and to
grow community participation.
2. Currently the Thrift Shop is limited in its ability to raise revenue by the limitation of floor space.
Projected estimates indicate that there is untapped revenue capacity with increased floor space.
This autumn the Thrift Shop will explore a community partnership with a group of citizens to
develop the site formerly used for recycling into a Center for Community Sustainability. The
Center would incorporate several compatible ideas suggested by the community during the
public input process of Winter-Spring 2010; one of which would be the processing of Thrift
Shop donations.
Processing donations at the former recycling center, across from the current Thrift Shop, would
allow two new sources of revenue. The first new source would come from preparing the
current pass through goods for bulk resale. A conservative estimate for this annual revenue is
approximately $25,000.00. The second source of revenue would come from transforming the
current donation processing space into retail space (approximately 500 square feet). Increased
revenue space, along with an expansion of the current advertising campaign is conservatively
estimated to net an additional $135,000.00.
3. In addition to the above pilot projects the Department is exploring a partnership with another
Eastside city to replicate the Thrift Shop model of community reuse/recycle for human services
funding. A feasibility study is being conducted on placing a campus of human service providers (a
sort of one stop shopping for citizens needing a host of services) near the downtown area. The
YFS department is in discussions with this group to develop the infrastructure of volunteers,
_________________________________
C-112 City of Mercer Island 2011-2012 Budget
Budget Policies
donation solicitation and business operations to establish a thrift business. This endeavor would
have a shared-profits formula for an on-going business arrangement or a multi-year phase out
business plan. Both options would bring in revenue to the department though this is longer
term project that will most likely have revenue options for the next biennium.
The YFS department and the YFS Foundation will continue to explore feasible revenue options and
optimize public donations to ensure the community has needed human services.
2011-2012 Budget Impact
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ 136,009 $ 107,362 $ 103,414 $ 150,316
KC Grant Revenue 39,925 40,785 39,400 39,400
School Counselor Program Support 78,338 141,507 60,000 60,000
Thrift Shop 727,136 815,000 949,000 995,000
Program Fees & Donations 126,231 129,833 122,500 122,500
CTC Grant Funding 99,065 73,653 76,003 74,794
MIYFS Foundation Support 193,900 150,000 183,500 157,500
Interfund Transfer - YFS Endowment 3,291 3,000 3,500 3,500
Interfund Transfer - General Fund 465,000 440,000 320,000 320,000
Total Budgeted Resources $ 1,868,895 $ 1,901,140 $ 1,857,317 $ 1,923,010
Not Budgeted
Beginning Fund Balance (Reserved) 534,246 426,884 323,470 173,154
TOTAL RESOURCES $ 2,403,141 $ 2,328,024 $ 2,180,787 $ 2,096,164
USES
Budgeted
YFS Administration $ 446,206 $ 406,503 $ 450,271 $ 461,936
Thrift Shop 281,297 317,226 314,749 323,112
Diversion 15,043 15,130 15,202 15,505
School Counselor Program 435,563 485,382 412,376 428,617
Senior Outreach 77,149 76,905 79,621 82,784
VOICE Program 90,257 76,206 111,205 113,840
Jobline 37,217 34,695 36,904 38,363
Family Counseling & Assistance 259,198 261,978 260,576 268,953
Communities That Care 165,944 169,115 162,413 167,900
Interfund Transfers - CIP 61,021 58,000 14,000 22,000
Total Budgeted Expenditures $ 1,868,895 $ 1,901,140 $ 1,857,317 $ 1,923,010
Not Budgeted
Ending Fund Balance 534,246 426,884 323,470 173,154
TOTAL USES $ 2,403,141 $ 2,328,024 $ 2,180,787 $ 2,096,164
_________________________________
City of Mercer Island 2011-2012 Budget C-113
Budget Policies
_________________________________
C-114 City of Mercer Island 2011-2012 Budget
Budget Summary
This section has been prepared as a general summary of the 2011-2012 biennial budget for the City of Mercer
Island. It is designed to provide City residents and other interested parties with a quick overview of the fiscal
plans of the City Council and Administration for the upcoming two years. The summary is divided into ten
sub-sections:
City Organization – how the city is organized to do business
Staffing – who provides the services
Total Resources – what the funding sources are for the city
Total Expenditures – how the revenues are spent
Fund Summary – revenue and expenditure totals by fund
Property Taxes – where your tax dollars go
Utility Rates – overview of proposed rate increases
City Debt – purpose and status of debt issued by the City and debt capacity
Fund Balances – change in and composition of the ending balance for each fund
Dashboard Indicators – key measures of what matters most to management team and Council
If a more in-depth understanding of the budget is desired, please take some time to review the wealth of
information found within the graphs, charts, narrative text, and funding level summaries located in the full
budget document.
City Organization
The City of Mercer Island has a Council/Manager form of government. In this form, the City Council,
comprised of seven elected members, hires a City Manager to act as Chief Executive of the City. The City
Manager reports directly to the Council and carries out their policy. Council members listen to their
constituents, the Island residents, and also receive advice and help from the Council appointed Boards and
Commissions, which numbered nine in 2010. The Council is vitally interested in hearing the voices of all
residents and in increasing citizen involvement.
The day to day activities of the City are carried out by the ten departments shown on the chart on the next
page. For an in-depth description of the functions carried out by these departments, see Section G, which
summarizes the Operating Budget by Department. For a more summarized look at the operations of the City,
see Section E (General Fund Summary) and Section F (Utility Funds Summary).
_________________________________
City of Mercer Island 2011-2012 Budget D-1
Budget Summary
_________________________________
D-2 City of Mercer Island 2011-2012 Budget
Budget Summary
Staffing
The two charts that follow show the number of full-time and part-time positions authorized by the Council for
employment in the various departments. These authorized positions are those that are considered necessary
to carry out the core mission of the departments. Also included are the reductions to approved positions
resulting from the City Managers recommended service reductions in 2011-2012.
Regular Full Time Equivalents (FTE’s)
Department 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
City Attorney 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00
City Manager 4.00 4.00 4.00 4.00 2.00 2.00 4.00 4.00 3.60 3.60
Human Resources 5.00 5.00 3.00 3.00 3.00 3.00
Court 2.85 2.85 2.90 2.90 3.90 3.90 3.40 3.40
Development Services 18.00 18.00 17.00 17.00 18.00 18.00 18.00 18.00 17.00 17.00
Finance 10.00 10.00 10.00 10.00 7.00 7.00 7.00 7.00 7.00 7.00
Fire 30.00 30.00 31.00 31.00 31.50 31.00 31.00 31.00 31.00 31.00
Park & Recreation 19.00 19.00 20.00 20.00 21.75 21.75 22.50 22.50 22.50 22.50
Police 43.50 43.50 36.00 35.00 35.50 36.50 36.50 36.50 35.00 35.00
Youth & Family Services 14.40 14.40 14.40 14.40 15.50 15.50 15.50 15.50 14.50 14.50
Maintenance:
Support Services 7.00 7.00 7.00 7.00 6.50 6.50 7.00 7.00 7.00 7.00
Right of Way 8.00 8.00 8.00 8.00 8.00 8.00 6.50 6.50 5.50 5.50
Utilities 13.00 13.00 13.00 13.00 13.00 13.00 13.50 13.50 13.50 13.50
CIP 3.50 3.50 3.50 3.50 3.50 3.50 3.00 3.00 3.00 3.00
Non Departmental (IGS) 4.00 4.00 5.00 5.00 5.00 5.00
Total 173.40 173.40 169.75 168.75 177.15 177.65 179.40 179.40 174.00 174.00
Changes to Regular FTE’s
0.40 FTE Reduction in the Communications Coordinator Position;
0.50 FTE Reduction in Municipal Court Staffing;
1.0 FTE Reduction of the Transportation Manager Position;
1.0 FTE Reduction in a Police Hire Ahead Officer Position;
0.50 FTE Reduction in a Police Records Clerk Position;
0.50 FTE Reduction in the Youth Development Coordinator Position;
0.50 FTE Reduction in the YFS Fundraising Coordinator Position; and
1.0 FTE Reduction of the Right-of-Way Trails Maintenance Position.
In total, a staffing reduction of 5.40 FTE’s is included in the adopted budget for 2011-2012. In addition to the
above authorized positions, the City from time to time needs additional help to carry out programs. The
additional help is classified into three types – contract employees, casual labor, and consultants/contractors.
Contract employees are brought on to help with work overload conditions. These employees are
hired for a particular length of time, usually one or two years. A department may request that a contract
employee become permanent if ongoing workload warrants the request.
_________________________________
City of Mercer Island 2011-2012 Budget D-3
Budget Summary
Casual labor is brought on to supplement the City’s core staff in light of short-term workload issues
and/or special initiatives the City engages in. The most common use of workload-driven casual labor is the
employment of seasonal employees in both the Parks Maintenance and Recreation divisions of the Parks
and Recreation Department. The City employs both 6 month and 9 month seasonal staff. The City also
uses casual labor on a limited basis for temporary vacancies and other workload issues.
Consultants are hired when there is a need for a particular expertise that the staff does not possess,
when there is not enough work to justify hiring a full-time staff person, and when it has been determined
to be more cost effective than employing additional regular staff. Examples of consultant services are
architectural services, specialized engineering, and specialized financial services. Contractors are also
hired to do specialized work such as servicing the City’s heating and cooling systems and janitorial
maintenance of our buildings.
Contract Full Time Equivalents (FTE’s)
CONTRACT 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Development Services 2.0 2.0 1.0 1.0
Fire 1.0 1.0 - -
Maintenance 0.75 0.75 0.25 0.0
Park & Recreation 2.0 4.0 3.0 4.0
Youth & Family Services 3.0 3.0 3.0 3.0
Total 5.75 5.75 8.35 13.25 9.50 9.50 8.75 10.75 7.25 8.00
Note: Contract FTE’s related to the Capital Improvement Program are not reflected in this table. Rather, only Operating Budget
contract FTE’s are shown.
_________________________________
D-4 City of Mercer Island 2011-2012 Budget
Budget Summary
Full Time Equivalents (FTE’s) and Contract FTE’s
195.00
190.00
185.00
180.00
175.00
170.00
165.00
160.00
155.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Contract FTE 5.75 5.75 8.35 13.25 9.50 9.50 8.75 10.75 7.25 8.00
Regular FTE 173.40 173.40 169.75 168.75 177.15 177.65 179.40 179.40 174.00 174.00
_________________________________
City of Mercer Island 2011-2012 Budget D-5
Budget Summary
Total Resources
For 2011 and 2012 respectively, the City is forecasting resources of $47,640,060 and $50,737,970. These
totals include fund balance allocated to cover planned expenditures, but exclude the remaining, reserved
beginning fund balances in each fund. Beginning fund balances can be used as resources and are typically used
for capital projects. A summary of fund balances is presented later in this section. The City derives its
revenues from a variety of sources as the graphs on the following pages show. The largest source is for
Charges for Services, which is largely generated from the water, sewer, and stormwater utility rates. Other
service charges include recreation fees, counseling fees, and Thrift Shop sales. The second largest source of
revenue is the property tax paid by our Island residents and businesses. Property taxes are budgeted at $10.6
million in 2011 and $10.8 million in 2012. Sales taxes, real estate excise taxes, utility taxes, and state shared
revenues amount to $10.2 million in 2011 and $11.2 million in 2012. Together, these five revenues account
for almost 44% of the total City resources in the 2011-2012 biennium. The chart below details revenues for
the period 2009-2012. The graphs that follow on the next page show the percentages of the major revenue
sources for 2011 and 2012.
2009-2012 Resources, All Funds
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Use of Fund Balance $ 1,373,037 $ 19,753,395 $ 3,155,440 $ 3,043,033
Property Tax 10,299,700 10,537,514 10,636,525 10,842,165
Sales Tax 3,023,540 2,943,000 3,032,000 3,154,000
Business & Utility Taxes 3,777,335 3,691,000 3,845,000 4,032,000
Real Estate Excise Tax 1,257,880 1,985,000 1,708,750 2,179,000
Shared Revenues 2,785,072 1,777,716 1,588,307 1,867,749
Utility Overhead 808,500 863,800 698,017 732,683
Charge for Service 33,584,189 16,792,122 18,573,930 20,436,747
Licenses & Permits 1,685,102 1,661,775 1,863,970 1,889,670
District Court Fines 390,425 370,000 394,000 394,000
Other Resources 2,487,408 727,078 438,512 431,250
Interest 243,159 75,656 65,312 68,923
Interfund Transfers In 2,732,946 2,241,356 1,615,297 1,691,750
Total Budgeted Resources 64,448,293 63,419,412 47,615,060 50,762,970
Not Budgeted
Beginning Fund Balance 31,124,380 17,877,876 15,473,663 13,243,624
TOTAL RESOURCES $ 95,572,672 $ 81,297,288 $ 63,088,723 $ 64,006,595
_________________________________
D-6 City of Mercer Island 2011-2012 Budget
Budget Summary
2011 Resources, All Funds
Total: $47,615,060
Other Interfund Transfers In
District Court Fines 1% 3% Use of Fund Balance
1% 7%
Licenses & Permits
4%
Property Tax
22%
Charge for Service
39%
Sales Tax
6%
Business & Utility Taxes
8%
Utility Overhead
2% Real Estate Excise Tax
Shared Revenues 4%
3%
2012 Resources, All Funds
Total: $50,762,970
Other Interfund Transfers In
District Court Fines 1% 3%
1% Use of Fund Balance
6%
Licenses & Permits
4%
Property Tax
21%
Sales Tax
6%
Charge for Service
40%
Business & Utility Taxes
8%
Real Estate Excise Tax
Utility Overhead 4%
2% Shared Revenues
4%
_________________________________
City of Mercer Island 2011-2012 Budget D-7
Budget Summary
Total Expenditures
The 2011-2012 two-year budget for all City funds totals $96.2 million. In 2011, expenditures amount to $46.8
million, while the 2012 total amounts to $49.4 million. Those totals represent the expenditures for 20
different funds that are budgeted by the City. Section I (Recap by Fund) briefly describes and presents the
revenue and expenditures for each fund.
The major funds of the City are the General Fund, the Utility Funds, the Capital Project Funds, and the Street
Fund. The General Fund constitutes the largest operating fund, providing for such general government
services as police and fire protection, emergency medical response, street and park maintenance, recreation
programs, and development services. General Fund expenditures are budgeted at $22.8 million and $23.4
million respectively in 2011 and 2012. The second largest group of funds is the Water, Sewer and Storm
Water Utility Funds which together provide funding for the Water distribution, Sewage disposal and Storm
Water services provided to Mercer Island residents. In 2011, the Utilities are budgeted at $14.4 million,
including capital projects. In 2012, their combined budgets total $15.5 million. For more information on the
General Fund, see Section E of the budget. The Water, Sewer and Storm Water Utilities are described in
Section F.
Another way to look at the overall City budget is by expenditure category. The $46.8 million in 2011
budgeted expenditures is comprised of 14 separate categories as the table below illustrates. The largest
expenditure categories citywide are salaries and benefits at 46.2% of the total budget in 2011.
2009-2012 Expenditures, All Funds
2009 2010 2011 2012
Description Actual Forecast Budget Budget
USES
Budgeted
Salaries & Wages $ 15,972,659 $ 17,202,758 $ 16,269,764 $ 16,628,854
Benefits 4,987,948 5,705,543 5,337,368 5,868,786
Supplies 1,493,978 1,522,438 1,367,058 1,368,006
Contractual Services 5,157,729 6,597,293 4,364,768 3,957,147
Communications 244,654 287,608 242,962 243,762
Equipment Rental 1,685,293 1,688,253 1,742,699 1,742,899
Insurance 809,612 892,543 1,057,881 1,132,257
Utilities 765,221 823,950 795,633 837,867
Other Services & Charges 1,961,429 2,799,978 1,508,916 1,575,625
Intergovernmental 1,020,875 1,040,585 1,006,234 1,028,275
Water/Sewer Treatment 4,923,018 4,859,927 5,385,458 5,646,430
Capital 15,363,716 16,977,241 4,461,812 5,929,325
Bond Redemption 881,260 1,677,824 1,728,251 1,821,654
Interfund Transfers 2,674,009 2,359,893 1,533,259 1,684,780
Total Budgeted Expenditures 57,941,401 64,435,834 46,802,064 49,465,668
Not Budgeted
Budget Cuts & Expenditure Savings (1,767,649)
Ending Fund Balance 37,631,271 18,629,104 16,286,658 14,540,927
TOTAL USES $ 95,572,672 $ 81,297,288 $ 63,088,723 $ 64,006,595
_________________________________
D-8 City of Mercer Island 2011-2012 Budget
Budget Summary
2011 Expenditures, All Funds
Total: $46,802,064
Bond Redemption Interfund Transfers
Capital 4% 3%
10%
Metro/Water Salaries & Wages
11% 35%
Intergovernmental
2%
Other
3%
Utilities
2%
Benefits
Insurance 11%
2%
Equipment Rental Supplies
4% Contract Services 3%
9%
Communications
1%
2012 Expenditures, All Funds
Total: $49,465,668
Bond Redemption Interfund Transfers
4% 3%
Capital
12% Salaries & Wages
34%
Metro/Water
11%
Intergovernmental
2%
Other
3%
Utilities Benefits
2% 12%
Insurance
2% Supplies
Contract Services 3%
Equipment Rental
4% 8%
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City of Mercer Island 2011-2012 Budget D-9
Budget Summary
Fund Summary
Summarized below are total revenues and expenditures by fund for the period 2009-2012.
Summary of Revenues by Fund for 2009-2012
Fund 2009 2010 2011 2012
No. Description Actual Forecast Budget Budget
001 General Fund $ 22,758,933 $ 23,212,420 $ 22,775,124 $ 23,414,948
037 Self Insurance Fund 4,767 10,000 10,000 10,000
061 Youth Service Endowment Fund 3,291 3,000 3,500 3,500
Subtotal General Purpose Funds $ 22,766,992 $ 23,225,420 $ 22,788,624 $ 23,428,448
104 Street Fund $ 2,187,417 $ 3,246,069 $ 1,363,998 $ 2,035,817
112 Criminal Justice Fund 727,134 750,346 547,312 565,666
117 Beautification Fund 878,411 841,011 888,802 901,550
130 Contingency Fund 176,500 478,522 130,828 415,161
140 1% For the Arts Fund 214,908 43,350 40,900 32,000
160 Youth and Family Services Fund 1,868,895 1,901,140 1,857,317 1,923,010
Subtotal Special Revenue Funds $ 6,053,266 $ 7,260,438 $ 4,829,157 $ 5,873,204
208 Bond Redemptiion (Voted) $ 206,239 $ - $ - $ -
239 Bond Redemption (Non-Voted) 359,821 453,143 446,030 441,241
Subtotal Debt Service Funds $ 566,060 $ 453,143 $ 446,030 $ 441,241
343 Capital Improvement Fund $ 2,914,606 $ 3,446,078 $ 1,680,197 $ 1,978,167
345 Technology and Equipment Fund 716,832 832,000 377,000 355,877
350 Capital Reserve Fund - 1,035,000 100,000 -
Subtotal Capital Funds $ 3,631,438 $ 5,313,078 $ 2,157,197 $ 2,334,044
402 Water Fund $ 5,422,933 $ 4,585,764 $ 4,851,647 $ 6,266,771
426 Sewer Fund 22,243,243 18,352,445 7,220,030 7,431,249
432 Storm Water Fund 1,777,391 1,795,331 2,358,281 2,418,022
Subtotal Enterprise Funds $ 29,443,566 $ 24,733,540 $ 14,429,958 $ 16,116,042
503 Equipment Rental Fund $ 1,318,400 $ 1,712,390 $ 2,179,586 $ 1,827,483
520 Computer Equipment Fund 600,403 653,403 709,507 659,507
Subtotal Internal Service Funds $ 1,918,803 $ 2,365,793 $ 2,889,093 $ 2,486,990
606 Firemen's Pension Fund $ 68,168 $ 68,000 $ 75,000 $ 83,000
Subtotal Trust Funds $ 68,168 $ 68,000 $ 75,000 $ 83,000
Total Revenues $ 64,448,293 $ 63,419,412 $ 47,615,060 $ 50,762,970
_________________________________
D-10 City of Mercer Island 2011-2012 Budget
Budget Summary
Summary of Expenditures by Fund for 2009-2012
Fund 2009 2010 2011 2012
No. Description Actual Forecast Budget Budget
001 General Fund $ 22,758,933 $ 24,980,069 $ 22,775,124 $ 23,414,948
037 Self Insurance Fund 5,000 10,000 10,000 10,000
061 Youth Service Endowment Fund 3,291 3,000 3,500 3,500
Subtotal General Purpose Funds $ 22,767,224 $ 24,993,069 $ 22,788,624 $ 23,428,448
104 Street Fund $ 1,945,499 $ 3,246,069 $ 1,354,957 $ 2,035,817
112 Criminal Justice Fund 665,879 750,346 547,312 565,666
117 Beautification Fund 873,860 741,011 884,061 891,874
130 Contingency Fund - 478,522 130,828 415,161
140 1% For the Arts Fund 37,000 43,350 40,600 10,000
160 Youth and Family Services Fund 1,868,895 1,901,140 1,857,317 1,923,010
Subtotal Special Revenue Funds $ 5,391,134 $ 7,160,438 $ 4,815,075 $ 5,841,528
208 Bond Redemptiion (Voted) $ 199,880 $ - $ - $ -
239 Bond Redemption (Non-Voted) 359,821 453,142 446,030 441,241
Subtotal Debt Service Funds $ 559,701 $ 453,142 $ 446,030 $ 441,241
343 Capital Improvement Fund $ 1,309,746 $ 3,446,078 $ 1,680,197 $ 1,978,167
345 Technology and Equipment Fund 716,832 832,000 377,000 355,877
350 Capital Reserve Fund 509,381 1,035,000 - -
Subtotal Capital Funds $ 2,535,958 $ 5,313,078 $ 2,057,197 $ 2,334,044
402 Water Fund $ 4,852,815 $ 4,585,764 $ 4,851,647 $ 5,626,709
426 Sewer Fund 18,070,206 18,352,445 7,220,030 7,431,249
432 Storm Water Fund 1,777,391 1,595,558 2,358,281 2,418,022
Subtotal Enterprise Funds $ 24,700,412 $ 24,533,767 $ 14,429,958 $ 15,475,980
503 Equipment Rental Fund $ 1,318,400 $ 1,366,763 $ 1,647,683 $ 1,357,165
520 Computer Equipment Fund 600,403 547,575 542,495 504,260
Subtotal Internal Service Funds $ 1,918,804 $ 1,914,338 $ 2,190,178 $ 1,861,425
606 Firemen's Pension Fund $ 68,168 $ 68,000 $ 75,000 $ 83,000
Subtotal Trust Funds $ 68,168 $ 68,000 $ 75,000 $ 83,000
TOTAL EXPENDITURES $ 57,941,401 $ 64,435,834 $ 46,802,064 $ 49,465,668
_________________________________
City of Mercer Island 2011-2012 Budget D-11
Budget Summary
Property Taxes
Property taxes play an essential role in financing the operations of the City of Mercer Island, accounting for
about 22.0% of the City's total budgeted resources in 2011-2012. Mercer Island property owners will pay
$10.64 million in property taxes in 2011 and $10.84 million in 2012 to support City services.
Types of Property Tax
There are two general types of property tax levies collected by the City: 1) regular levy, and 2) voter
approved levy. The regular levy, which is $9.68 million in 2011, represents the base amount of property tax
dedicated to funding the City’s general government operations. Each year the amount of revenue to be raised
from property taxes is determined based on forecasted expenditures, other revenue sources, and state law
limitations. Washington State law, which changed in 1997, limits property tax levies to 101% of the previous
year's tax revenue or to the rate of inflation, whichever is less. This is a big change from the original law which
allowed taxing districts to levy 106% each year. See the Property Tax policy in Section C for additional
information.
There are two types of voter approved levies, which represent property tax increases over and above the
regular levy: 1) excess levy, and 2) levy lid lift. An excess levy is dedicated to paying the principal and interest
on debt issued for capital purchases or improvements. Currently, the City doesn’t have any excess levies. A
levy lid lift is dedicated to funding specific general government operations and/or capital improvements. Voter
approved levies in the past have included land for parks and open space, new fire trucks, the remodeling of
City Hall, and the maintenance and operation of Luther Burbank Park. In November 2008, Mercer Island
voters approved a Parks Maintenance and Operations Levy lid lift for 15 years. The levy lid lift amount in 2011
is $882,000.
Later in this section information regarding the City’s debt is provided. For more detail, see the Debt Financing
policy in Section C.
Property Tax Levy Rates
If a homeowner on Mercer Island only paid property taxes to the City, how much would that amount to? For
a resident with a home valued at $1.0 million, the City's portion of the property tax bill in 2010 amounts to
$1,201. However, Mercer Island is not the only governmental entity that has the authority to levy property
taxes. Following is the millage levy rate for each of the entities to which a property owner pays taxes. The
City portion is 15.4% of the total taxes paid in 2010. The largest levy amount relates to schools, with the
combined portion that goes to the state and the Mercer Island School District amounting to 54.3% of the total
tax bill in 2010. For a $1.0 million home on Mercer Island, the total 2010 levy amounts to $7,805, as noted
below.
% of Total 2010 Levy
Purpose in 2010 Amount
State School Fund 28.5% $2,223
School District 25.8% $2,010
King County 16.5% $1,285
City 15.4% $1,201
Library 5.9% $461
EMS 3.8% $300
Port 2.8% $216
Flood Zone 1.3% $105
Ferry District 0.0% $3
Total 100.0% $7,805
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D-12 City of Mercer Island 2011-2012 Budget
Budget Summary
Utility Rates
The Water and Sewer Funds are completely self-supporting activities that do not receive funding from
property taxes or any other City fund. The utilities are designed to operate like businesses, charging rates for
the purpose of providing water distribution and sewer disposal services to City residents. The City purchases
its water from the City of Seattle as do many of our neighboring communities. The Wastewater Treatment
Division of King County provides treatment for all of the sewage in the King County area, including Mercer
Island. The City's sewage is pumped to Renton where it is treated through a secondary treatment process.
The resulting sludge is further treated at the West Point Treatment Plant.
The King County Wastewater Treatment rate is the largest part of the total cost of the Sewer utility bill. In
2011, King County treatment costs will be close to $3.8 million, or 69% of the total operating budget. King
County Wastewater Treatment rates have risen dramatically in the past few years because of the recent
construction of the Brightwater Treatment Plant in unincorporated Snohomish County. A history of KC
Wastewater Treatment rate increases is presented in the table below:
Year 2005 2006 2007 2008 2009 2010 2011
Monthly Rate (flat) $ 25.60 $ 25.60 $ 27.95 $ 27.95 $ 31.90 $ 31.90 $ 36.10
% Increase 9.4% 0.0% 9.2% 0.0% 14.13% 0.0% 13.2%
For a number of years (1993-2003), the City did not raise its portion of the sewer rate. However, in 2004-
2010, due to the design and construction of part of the Sewer Lake Line, rates were increased between 9%
and 18.1% each year. Sewer rate increases of 9.3% in 2011 and 2012 are recommended to provide capital
reinvestment in the rest of the Sewer System, which was held to a minimum while funds were built up to pay
for the $24.2 million in construction costs for the Sewer Lake Line project.
Seattle Public Utilities has also increased rates annually for the last 6 years. For 2011, water rates will remain
flat for Mercer Island. The City of Seattle sets rates in 3 year periods and has not yet forecast rates for 2012-
2014, but anticipates a large increase (10%-20%) to wholesale water rates in 2012, followed by more moderate
increases of about 5% per year. A history of Seattle Public Utility rate increases is presented in the table
below:
Year 2005 2006 2007 2008 2009 2010 2011
Monthly Rate (per ccf) * $ 1.32 $ 1.39 $ 1.42 $ 1.44 $ 1.57 $ 1.58 $ 1.58
% Increase 4.0% 5.3% 2.2% 1.4% 9.0% 0.6% 0.0%
*Rate presented is a weighted average of Peak and Off-Peak Rates, and is adjusted for Sub-regional charges paid by Mercer Island.
In 2006, the Utility Board conducted a thorough review of the City’s water rate structure. Rate equity
between customer classes was reviewed, and the rate block structure was adjusted too. Based on that review,
the City’s water rates were raised an average of 6.65% in 2007, 8.8% in 2008, and 10.5% in 2009. In 2009,
another in-depth rate study reviewed the overall water use (consumption) on which rates are based, customer
cost allocations, capital needs, and identified fire protection costs to be recovered through a utility tax instead
of rates The rate block structure was again adjusted to reduce fluctuations in revenue from declining water
use. Water rates were raised an average of 10% in 2010. For 2011-2012, staff plans on using debt financing
for the First Hill Water Improvement project ($1.2M) in order to bring rate increases below the 12% and 15%
forecast for 2011 and 2012, assuming the project was funded on a pay-as-you-go basis. Consequently, water
_________________________________
City of Mercer Island 2011-2012 Budget D-13
Budget Summary
rate increases of 9.5% in 2011 and 2012 are recommended. It should be noted that the actual increase a
customer experiences will vary based on customer class and actual water consumption.
In May 1993, the City began preparing to make significant changes in the way it manages storm water on
Mercer Island. The catalyst for this effort was new regional, state, and federal requirements that must be met
by local governments. In 1994, the Utility Board, at the direction of the City Council, began studying the
entire storm water management area. The Storm Water Utility was formed in 1996, and the City began
implementing plans for major improvements to the storm water system. The budget reflects the program
development goals as recommended by the Utility Board. The program budget for the storm water system
stayed at a rate of $11.70 for 3 years (2003-2005). In 2006 and 2007 storm water rates were increased 60
cents and 70 cents per month respectively at the recommendation of the Utility Board. The City Council
opted to not take a rate increase in 2008, and held storm water rates at $13.00 per month, following the
Utility Board’s recommendation. In 2009 and 2010, rates were increased by 5.5% each year, which equated to
an increase of 72 cents per month in 2009 and 76 cents per month in 2010. It is recommended that storm
water rates be increased 3.3% in 2011 and 2012. This will allow continuation of the City's storm water quality
monitoring, evaluation, and maintenance and will fund the capital improvement program.
A thorough discussion of emerging issues, operations and maintenance, and rates, along with financial
statements for the Water, Sewer, and Storm Water Utilities are included in Section F.
City Debt
The City has prudently issued little debt over the years, maintaining a sizable debt capacity and consistently
following a conservative fiscal management policy as reflected in the excellent bond ratings from Moody's
rating service—Aa1 rating for its unlimited tax general obligation (UTGO), or voted, bonds and a Aa2 rating
on its limited tax general obligation (LTGO), or non-voted, bonds. Only four cities have equivalent or higher
UTGO bond ratings according to Moody’s: Seattle (Aaa), Bellevue (Aaa), Redmond (Aa1), and Kirkland (Aa1).
A high bond rating equates to lower interest costs and is very desirable.
The City can issue five types of debt which have legal limits set by the State. The five types of debt include:
voted and non-voted general obligation bonds, revenue bonds, lease debt, and loans. For the purposes of the
legal limit debt calculations, leases and loans are included with the non-voted general obligation debt limits. A
schedule of all the City debt classified by type is included later in this section.
Voted Debt
Voted debt is that which the citizens agree to in an election and is supported by special (excess) tax revenues
levied on property each year. Voted debt has generally been used for the purpose of funding large public
buildings or buying open space property. The City currently has no voted debt outstanding.
Non-Voted Debt
Non-voted debt must be paid for out of the general revenues of the city. Non-voted debt includes not only
bonds but also any loans and lease obligations of the City. The active bond issues are described below.
2003 CCMV Property – This bond issue, paid for from real estate excise taxes, was used to buy the site
from the Mercer Island School District for the construction of a new community center. The total
principal owed at the end of 2010 is $1,135,000.
2004 CCMV Construction – In 2004, the City issued $2.0 million in councilmanic bonds to partially pay
for the construction of a new community center. The new center was completed in December 2005. The
total principal owed at the end of 2010 is $1,520,000.
_________________________________
D-14 City of Mercer Island 2011-2012 Budget
Budget Summary
2007 Fire Apparatus Lease (Velocity Pumpers) – In 2007, the Mercer Island City Council authorized
a contract with Pierce Manufacturing to purchase two Velocity Pumper Trucks through a lease purchase
financing agreement with Municipal Asset Management Inc. in the amount of $1,035,026. The total
principal owed at the end of 2010 is $758,561.
2007 Fire Apparatus Lease (Mini Pumper) – In 2007, the Mercer Island City Council authorized a
contract with Pierce Manufacturing to purchase one Mini Pumper Fire Truck through a lease Purchase
financing agreement with Municipal Asset Management Inc. in the amount of $251,982. The total principal
owed at the end of 2010 is $166,336.
2009 LTGO Emergency Water Supply – In June 2009, the City issued a two year $1,015,000 LTGO
bond as interim financing for the construction of a well for emergency water supply use. To pay off the
debt, the Council’s declared intent is to sell a First Hill property owned by the Water Utility, which was
surplussed in April 2009. In June 2010, given the condition of the Puget Sound real estate market, the
City amended the terms of the two year LTGO bond, extending the maturity date out another two years
to June 1, 2013. In addition, the City exercised its option to prepay $40,000 of the principal early, thereby
reducing the par amount of the bond to $975,000. Debt service is being paid by the Water Fund. The
total principal owed at the end of 2010 is $975,000.
2009 LTGO South Mercer Playfields – In 2009, LTGO bonds were issued to fund capital
improvements at the South Mercer Playfields. The original issue amount was $1,000,000, and the total
principal outstanding at the end of 2010 is $940,000.
2009 LTGO Sewer Lake Line – In 2009, LTGO bonds were issued to fund a portion of the sewer lake
line replacement project. Sewer utility rates are being used to repay the long-term debt. The original
issue amount was $9,405,000, and the total principal outstanding at the end of 2010 is $9,130,000.
Public Work Trust Fund Loans
In addition to the above debt, the City has the two long-term loans outstanding as of the end of 2010. Public
Works Trust Fund loans are low-interest loans (1% interest) administered through the State of Washington
Department of Community Development. In 1985, the legislature made provisions for this program from the
Public Works Assistance Account, which is funded by the Motor Vehicle Excise Tax (MVET) collected by the
state. Qualifying criteria require jurisdictions to do the following:
1. Impose the ¼ of one percent real estate excise tax;
2. Have developed a long-term plan for financing public work needs;
3. Be using all local revenue sources which are reasonably available for funding public works; and,
4. Have an adopted comprehensive plan.
_________________________________
City of Mercer Island 2011-2012 Budget D-15
Budget Summary
Schedule of Outstanding Debt
City of Mercer Island
Schedule of Long Term Debt
Original Amount Outstanding
Description Date Issued Amount 12/31/2010
Non-Voted Debt:
2003 Mercerview Property 05/15/03 2,290,000 1,135,000
2004 CCMV Construction 10/01/04 2,040,000 1,520,000
2009 LTGO Water Well 07/15/09 1,015,000 975,000
2009 LTGO South Mercer Playfields 08/17/09 1,000,000 940,000
2009 LTGO Sewer Lake Line 08/17/09 9,405,000 9,680,000
Total Non-Voter Approved $15,750,000 $14,250,000
Voted Debt:
Total Voter Approved $0 $0
Lease Obligations
2007 Fire Velocity Pumpers 07/02/07 1,035,026 758,561
2007 Fire Mini Pumper 09/24/07 251,982 166,336
Total Lease Obligations $1,287,008 $924,897
Total General Obligation Debt $17,037,008 $15,174,897
Public Works Trust Fund Loans
Sewer Pump Rehab II 11/06/92 368,625 35,455
Sewer Lake Line 01/31/05 6,650,000 6,094,118
Total Public Works Trust Fund $7,018,625 $6,129,573
Debt Capacity
The debt capacity of the City is limited by law. Below is a chart showing the computation of the debt capacity
as of December 31, 2009.
LIMITED TAX UNLIMITED TAX
General General Open Space and Utility
Purpose Debt Purpose Debt Parks Purposes
(1) (1)
(based on 1.5% (based on 2.5% (based on 2.5% (based on 2.5%
of AV) of AV) of AV) of AV)
Legal Limit $130,660,321 $217,767,201 $217,767,201 $217,767,201
Add: Cash on hand for
debt redemption 4,474 4,474 0 0
Less: Limited Tax Debt
outstanding -15,375,195 -15,375,195 0 0
Less: Unlimited Tax Debt
outstanding 0 0 0 0
Remaining Debt Capacity,
Limited Tax $115,289,600 $202,396,480
Remaining Debt Capacity,
Unlimited Taxes $217,767,201 $217,767,201
12/31/09 AV: $8,710,688,041 (I) Indebtedness for all General Purpose debt may not exceed 2.5% if AV, Any non-
voted debt reduces the margin available for voted general purpose debt.
_________________________________
D-16 City of Mercer Island 2011-2012 Budget
Budget Summary
Fund Balances
General Fund and Other General Government Funds
The City of Mercer Island's General Fund accounts for all financial transactions not required to be accounted
for in a separate fund by statute or generally accepted accounting principles. It is the City’s largest accounting
entity and provides for the majority of its general operations. Reserves are both operational and long term.
Three other general purpose funds are also presented.
General Fund - 001
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 3,811,784 $ 3,059,553 $ 2,264,282 $ 2,264,282
Plus Revenues 22,006,702 22,417,149 22,775,124 23,414,948
Less Expenditures (22,758,933) (23,212,420) (22,775,124) (23,414,948)
Ending Fund Balance $ 3,059,553 $ 2,264,282 $ 2,264,282 $ 2,264,282
Consisting of:
Compensated Absence Reserve 1,001,135 1,001,135 1,001,135 1,001,135
LEOFF1 Long Term Care Reserve 913,108 913,108 913,108 913,108
Deferred Revenues & Customer Deposits 216,069 216,069 216,069 216,069
Inventory of Supplies 114,777 114,777 114,777 114,777
Petty Cash 3,020 3,020 3,020 3,020
Revenue Stabilization Reserve 14,936 - - -
Funding for Carryover Expenditures in 2010 122,828 - - -
Funding for One Time Expenditures 2010 657,507 - - -
Unreserved 16,173 16,173 16,173 16,173
Self Insurance Fund - 037
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 111,758 $ 111,525 $ 111,525 $ 111,525
Plus Revenues 4,767 10,000 10,000 10,000
Less Expenditures (5,000) (10,000) (10,000) (10,000)
Ending Fund Balance $ 111,525 $ 111,525 $ 111,525 $ 111,525
Consisting of:
Self Insurance Reserve 111,525 111,525 111,525 111,525
_________________________________
City of Mercer Island 2011-2012 Budget D-17
Budget Summary
Youth Service Endowment Fund - 061
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 309,395 $ 309,395 $ 309,395 $ 309,395
Plus Revenues 3,291 3,000 3,500 3,500
Less Expenditures (3,291) (3,000) (3,500) (3,500)
Ending Fund Balance $ 309,395 $ 309,395 $ 309,395 $ 309,395
Consisting of:
Reserve Endowment Principal 285,856 285,856 285,856 285,856
Unreserved 23,539 23,539 23,539 23,539
Special Revenue Funds
Special Revenue Funds are established to account for the proceeds of specific revenue sources that are
restricted to provide for particular functions or activities of the City. The restricted revenues are segregated
into individual funds to ensure that expenditures are made exclusively for the purpose designated.
Street Fund - 104
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 3,405,383 $ 3,647,300 $ 1,905,461 $ 1,914,501
Plus Revenues 2,187,416 1,504,230 1,363,998 1,609,315
Less Expenditures (1,945,499) (3,246,069) (1,354,957) (2,035,817)
Ending Fund Balance $ 3,647,300 $ 1,905,461 $ 1,914,501 $ 1,487,999
Consisting of:
Traffic Signal Reserve 84,272 - - -
Reserve ICW Pedestrian Crossings - 225,000 225,000 225,000
Appropriated for Expenditures Next Year 1,741,839 - 426,502 1,053,112
Working Capital Reserve 200,000 200,000 200,000 200,000
Unreserved 1,621,189 1,480,461 1,062,999 9,887
_________________________________
D-18 City of Mercer Island 2011-2012 Budget
Budget Summary
Criminal Justice Fund - 112
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 756,202 $ 817,457 $ 548,270 $ 484,708
Plus Revenues 727,134 481,159 483,750 501,750
Less Expenditures (665,879) (750,346) (547,312) (565,666)
Ending Fund Balance $ 817,457 $ 548,270 $ 484,708 $ 420,792
Consisting of:
Treasury Funds Reserve 165,715 165,715 136,715 107,715
JAG Proceeds 160,944 79,437 79,437 79,437
ENTF Reserve 50,872 50,872 50,872 50,872
Funding for Expenditures Next Year 269,187 63,562 63,916 -
Working Capital Reserve 50,000 50,000 50,000 50,000
Unreserved 120,739 138,684 103,768 132,768
Beautification Fund - 117
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 658,681 $ 663,232 $ 693,891 $ 595,575
Plus Revenues 878,411 771,670 785,745 801,550
Less Expenditures (873,860) (741,011) (884,061) (891,874)
Ending Fund Balance $ 663,232 $ 693,891 $ 595,575 $ 505,251
Consisting of:
Street Light Control Cabinet Reserve 150,000 150,000 150,000 150,000
Funding for Expenditures Next Year 69,341 103,057 100,000 -
Working Capital Reserve 75,000 75,000 75,000 75,000
Unreserved 368,891 365,834 270,575 280,251
Contingency Fund - 130
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 2,167,835 $ 2,344,335 $ 1,865,813 $ 1,734,985
Plus Revenues 176,500 - - -
Less Expenditures - (478,522) (130,828) (415,161)
Ending Fund Balance $ 2,344,335 $ 1,865,813 $ 1,734,985 $ 1,319,824
Consisting of:
Contingency Reserve-(City Policy) 2,344,335 1,865,813 1,734,985 1,319,824
_________________________________
City of Mercer Island 2011-2012 Budget D-19
Budget Summary
1% For the Arts Fund - 140
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 161,243 $ 339,151 $ 314,911 $ 284,611
Plus Revenues 214,908 19,110 10,300 32,000
Less Expenditures (37,000) (43,350) (40,600) (10,000)
Ending Fund Balance $ 339,151 $ 314,911 $ 284,611 $ 306,611
Consisting of:
Funding for Expenditures Next Year 24,250 30,600 - -
Unreserved 314,901 314,911 284,611 306,611
Youth and Family Services Fund - 160
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 670,255 $ 534,246 $ 426,884 $ 323,470
Plus Revenues 1,732,886 1,793,778 1,753,903 1,772,694
Less Expenditures (1,868,895) (1,901,140) (1,857,317) (1,923,010)
Ending Fund Balance $ 534,246 $ 426,884 $ 323,470 $ 173,154
Consisting of:
Funding for Expenditures Next Year 107,362 103,414 150,316 -
Working Capital Reserve 75,000 75,000 75,000 75,000
Unreserved 351,884 248,470 98,154 98,154
Debt Service Funds
Debt Service Funds account for the accumulation of resources for the payment of principal and interest on
general obligation bonds. General obligation bonds are those for which the full faith and credit of the City are
pledged.
Bond Redemption Voted - 208
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 12,584 $ 18,943 $ 18,943 $ 18,943
Plus Revenues 206,239 - - -
Less Expenditures (199,880) - - -
Ending Fund Balance $ 18,943 $ 18,943 $ 18,943 $ 18,943
Consisting of:
Funding for Expenditures Next Year - - - -
Debt Service Reserve 18,943 18,943 18,943 18,943
_________________________________
D-20 City of Mercer Island 2011-2012 Budget
Budget Summary
Bond Redemption Non-Voted - 239
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 4,474 $ 4,474 $ 4,474 $ 4,474
Plus Revenues 359,821 453,143 446,030 441,241
Less Expenditures (359,821) (453,143) (446,030) (441,241)
Ending Fund Balance $ 4,474 $ 4,474 $ 4,474 $ 4,474
Consisting of:
Debt Service Reserve 4,474 4,474 4,474 4,474
Capital Project Funds
Capital Project Funds account for financial resources to be used for the acquisition or construction of capital
facilities other than those financed by enterprise or internal service funds.
Capital Improvement Fund - 343
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,456,988 $ 3,061,848 $ 1,177,093 $ 892,121
Plus Revenues 2,914,606 1,561,323 1,395,225 1,652,600
Less Expenditures (1,309,746) (3,446,078) (1,680,197) (1,978,167)
Ending Fund Balance $ 3,061,848 $ 1,177,093 $ 892,121 $ 566,555
Consisting of:
Funding for Expenditures Next Year 1,884,755 284,972 325,567 769,199
All Weather Field Repl Reserve 94,903 160,375 247,975 335,575
Working Capital Reserve 250,000 250,000 250,000 250,000
Unreserved 832,190 481,746 68,579 (788,219)
Capital Technology & Equipment Fund - 345
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,682,230 $ 1,337,280 $ 730,280 $ 569,280
Plus Revenues 371,882 225,000 216,000 181,000
Less Expenditures (716,832) (832,000) (377,000) (355,877)
Ending Fund Balance $ 1,337,280 $ 730,280 $ 569,280 $ 394,403
Consisting of:
Fire Defibrilator Replacement 32,532 32,532 32,532 32,532
NORCOM 409,385 209,877 104,877 -
Funding for Expenditures Next Year 607,000 161,000 174,877 90,000
Working Capital Reserve 50,000 50,000 50,000 50,000
Unreserved 238,363 276,871 206,994 221,871
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City of Mercer Island 2011-2012 Budget D-21
Budget Summary
Capital Reserve Fund - 350
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,579,380 $ 1,069,999 $ 34,999 $ 134,999
Plus Revenues - - 100,000 -
Less Expenditures (509,381) (1,035,000) - -
Ending Fund Balance $ 1,069,999 $ 34,999 $ 134,999 $ 134,999
Consisting of:
Unreserved 1,069,999 34,999 134,999 134,999
Enterprise Funds
Enterprise Funds account for government activities that are financed and operated in a manner similar to
private business. Costs of providing services to the community are primarily financed by user fees.
Water Fund - 402
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,496,358 $ 2,066,476 $ 1,522,437 $ 1,290,895
Plus Revenues 5,422,933 4,041,725 4,620,105 6,266,771
Less Expenditures (4,852,815) (4,585,764) (4,851,647) (5,626,709)
Ending Fund Balance $ 2,066,476 $ 1,522,437 $ 1,290,895 $ 1,930,957
Consisting of:
Fiscal Policy Reserves 723,296 735,391 877,222 948,325
Capital Funding Reserve 250,000 281,341 293,567 309,423
Funding for Expenditures Next Year 544,039 231,542 - 153,123
Unreserved 549,141 274,163 120,106 520,086
Sewer Fund - 426
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 8,645,343 $ 12,818,379 $ 1,182,536 $ 787,546
Plus Revenues 22,243,243 6,716,602 6,825,040 7,138,063
Less Expenditures (18,070,207) (18,352,445) (7,220,030) (7,431,249)
Ending Fund Balance $ 12,818,379 $ 1,182,536 $ 787,546 $ 494,360
Consisting of:
Operating Reserves 393,582 403,314 446,512 450,528
Funding for Expenditures Next Year 11,635,843 394,990 293,186 -
Unreserved 788,954 384,232 47,848 43,832
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D-22 City of Mercer Island 2011-2012 Budget
Budget Summary
Storm Water Fund - 432
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,867,416 $ 1,781,103 $ 1,980,876 $ 1,407,912
Plus Revenues 1,691,079 1,795,331 1,785,318 2,063,439
Less Expenditures (1,777,392) (1,595,558) (2,358,281) (2,418,022)
Ending Fund Balance $ 1,781,103 $ 1,980,876 $ 1,407,912 $ 1,053,329
Consisting of:
Operating Reserves 81,163 81,661 77,450 80,167
Funding for Expenditures Next Year - 572,963 354,583 245,840
Unreserved 1,699,940 1,326,252 975,879 727,322
Internal Service Funds
Internal Service Funds account for the financing, on a cost-reimbursement basis, of goods and services
provided by one department or agency of the City to another department or agency of the City.
Fleet Rental Fund - 503
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 2,380,731 $ 2,368,945 $ 2,294,083 $ 1,913,273
Plus Revenues 1,306,616 1,291,901 1,266,874 1,211,558
Less Expenditures (1,318,400) (1,366,763) (1,647,683) (1,357,165)
Ending Fund Balance $ 2,368,945 $ 2,294,083 $ 1,913,273 $ 1,767,666
Consisting of:
800 MHz Radio Replacement 116,977 73,853 97,233 120,613
Fire Apparatus Sinking Fund 363,318 347,504 331,690 317,374
Vehicle Replacements Next Year 420,489 912,712 615,925 524,819
Operating Reserve 122,294 122,294 122,294 122,294
Vehicle Replacement Reserve 1,345,867 837,720 746,131 682,566
Computer Replacement Fund - 520
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 204,698 $ 195,528 $ 199,356 $ 246,368
Plus Revenues 591,233 551,403 589,507 589,507
Less Expenditures (600,403) (547,575) (542,495) (504,260)
Ending Fund Balance $ 195,528 $ 199,356 $ 246,368 $ 331,615
Consisting of:
Computer Replace Expenditures Next Year 102,000 120,000 70,000 70,000
Computer Replacement Reserve 93,528 79,356 176,368 261,615
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City of Mercer Island 2011-2012 Budget D-23
Budget Summary
Pension Trust Fund
Trust Funds account for assets held by the City in a trustee capacity or as an agent for individuals, private
organizations, and other governments.
Firemens Pension Fund - 606
2009 2010 2011 2012
Description Actual Forecast Budget Budget
Beginning Fund Balance $ 1,114,680 $ 1,082,100 $ 1,043,593 $ 997,793
Plus Revenues 35,588 29,493 29,200 30,000
Less Expenditures (68,168) (68,000) (75,000) (83,000)
Ending Fund Balance $ 1,082,100 $ 1,043,593 $ 997,793 $ 944,793
Consisting of:
Funding for Expenditures Next Year 38,507 45,800 53,000 53,000
Pension Reserve 1,043,593 997,793 944,793 891,793
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D-24 City of Mercer Island 2011-2012 Budget
Budget Summary
Dashboard Indicators
The City’s performance measurement model, called the Mercer Island Dashboard, was developed in 2007 with
the following objectives in mind:
1. To identify “top tier” indicators which capture the “state of the City” in terms of what matters most
to the management team and the City Council.
2. To collect meaningful information that impacts financial and human resource allocation decisions and
ultimately organizational direction during the biennial budget/CIP process.
3. To select a manageable group of measures that has minimal impact on productive staff time in terms of
data gathering.
The model is comprised of 35 “dashboard” indicators, which are organized around the City’s 6 priorities of
government and broken down into functional areas within each priority of government:
Community Safety & Security: 8 indicators
○ Personal Security
○ Crime Prevention Effectiveness
○ Traffic Safety Effectiveness
○ Timely Crime Response
○ Fire Suppression Effectiveness
○ Emergency Medical Aid Effectiveness
○ Timely Fire & Emergency Medical Aid Responses
○ Emergency Preparedness
Effective & Efficient Public Service Delivery: 14 indicators
○ Public Trust
○ Community Issues
○ Risk Management
○ Employee Retention & Morale
○ Development Permit Processing
○ Court Operations
○ Creditworthiness
○ Financial Management
○ Financial Condition
○ Environmental Stewardship (5 indicators)
Reliable Public Infrastructure: 4 indicators
○ General Government Infrastructure Condition (2 indicators)
○ Water Utility Infrastructure Condition
○ Sewer Utility Infrastructure Condition
Attractive Neighborhoods & Business Districts: 3 indicators
○ Neighborhood & Downtown Attractiveness (2 indicators)
○ Economic Vitality
Recreational, Cultural, Health & Educational Opportunities: 5 indicators
○ Recreation Programs & Facilities
○ Park Amenities
○ Youth Counseling & Intervention
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City of Mercer Island 2011-2012 Budget D-25
Budget Summary
○ Senior Outreach & Advocacy
○ Volunteerism & Human Services Funding
Public Communication & Community Involvement: 1 indicator
○ Informed Citizenry
In addition, many of the “dashboard” indicators are further broken down into sub-indicators to provide
context, to identify important components of each indicator, and to paint a clearer picture of performance.
Results are shown for 2006-2007, and where appropriate, targets have been established for 2010-2012. The
model is presented on the following page.
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D-26 City of Mercer Island 2011-2012 Budget
Budget Summary
Priority of Government
COMMUNITY SAFETY & SECURITY
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Personal Security:
1) % of residents who feel "very safe" or "completely safe"
walking alone:
► In their neighborhood N/A 86% N/A 86% N/A 88% N/A
► In the City's Town Center N/A 86% N/A 87% N/A 88% N/A
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
Crime Prevention Effectiveness:
2) Mercer Island's crime rate relative to other Eastside cities and
the King County average (expressed as # of Part 1 violent
crimes per 1,000 population followed by # of Part 1 property
crimes per 1,000 population):
► Sammamish 0.3 / 11.9 0.2 / 13.8 0.4 / 10.5 0.3 / 8.7 N/A N/A N/A
► Mercer Island 1.0 / 21.3 0.3 / 17.9 0.6 / 18.7 0.5 / 18.1 0.5 / 18.0 0.5 / 18.0 0.5 / 18.0
► Issaquah 0.4 / 46.6 0.4 / 35.0 0.6 / 31.0 0.7 / 23.6 N/A N/A N/A
► Redmond 1.3 / 35.0 1.5 / 33.3 1.3 / 32.9 1.1 / 31.9 N/A N/A N/A
► Bellevue 1.6 / 36.6 1.2 / 35.6 1.4 / 36.1 1.3 / 32.9 N/A N/A N/A
► Kirkland 1.9 / 39.7 1.4 / 39.5 2.0 / 40.2 1.2 / 33.7 N/A N/A N/A
► King County average 4.1 / 51.5 3.7 / 44.5 3.5 / 40.4 3.9 / 42.0 N/A N/A N/A
Traffic Safety Effectiveness:
3) Mercer Island's traffic accident rate relative to other Eastside
cities and the King County average (expressed as # of traffic
accidents per 1,000 population):
► Sammamish 7.37 6.43 6.24 5.46 N/A N/A N/A
► Mercer Island 12.12 16.04 12.01 12.68 12.50 12.50 12.50
► King County average 25.20 23.32 21.78 17.24 N/A N/A N/A
► Redmond 21.89 21.47 20.75 17.27 N/A N/A N/A
► Issaquah 31.27 23.88 20.82 17.81 N/A N/A N/A
► Kirkland 25.73 25.87 20.24 17.89 N/A N/A N/A
► Bellevue 28.38 24.39 24.43 21.45 N/A N/A N/A
Timely Crime Response:
4) Patrol officer response to emergency calls:
► # of emergency calls 431 347 313 451 450 450 450
► Average response time to emergency calls 4.7 min 4.3 min 4.3 min 4.8 min 4.6 min 4.6 min 4.6 min
► % of emergency calls responded to within 6 minutes 65% 69% 71% 74% 70% 70% 70%
Fire Suppression Effectiveness:
5) Mercer Island's annual $ fire loss per 1,000 population relative
to other Eastside cities and fire districts:
► Redmond $ 22,679 $ 13,440 $ 63,361 $ 2,406 N/A N/A N/A
► Bothell $ 33,119 $ 41,577 $ 17,734 $ 17,283 N/A N/A N/A
► Mercer Island $ 47,594 $ 10,735 $ 140,397 $ 18,778 N/A N/A N/A
► Eastside Fire & Rescue $ 22,614 $ 17,025 $ 25,132 $ 20,927 N/A N/A N/A
► Average (6 jurisdictions) $ 36,861 $ 37,018 $ 59,868 $ 27,683 N/A N/A N/A
► Bellevue $ 27,859 $ 41,017 $ 16,014 $ 42,694 N/A N/A N/A
► Kirkland $ 67,301 $ 98,316 $ 96,570 $ 64,008 N/A N/A N/A
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City of Mercer Island 2011-2012 Budget D-27
Budget Summary
Priority of Government
COMMUNITY SAFETY & SECURITY
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Emergency Medical Aid Effectiveness:
6) Mercer Island's cardiac arrest survival rate relative to the King
County average:
► Mercer Island N/A 50% 50% 0% 50% 50% 50%
► King County average N/A 46% 49% 43% N/A N/A N/A
Timely Fire & Emergency Medical Aid Responses:
7) Firefighter response to:
► Fire suppression calls:
● # of calls 107 45 72 63 80 80 80
● Average response time 6.8 min 6.7 min 6.7 min 6.3 min 6.3 min 6.3 min 6.3 min
● % of calls responded to within 6 minutes 40% 50% 49% 52% 50% 50% 50%
► Emergency medical aid calls:
● # of calls (excludes motor vehicle accidents) 1,451 1,487 1,530 1,531 1,580 1,600 1,620
● Average response time 6.2 min 6.0 min 6.0 min 5.8 min 6.0 min 6.0 min 6.0 min
● % of calls responded to within 6 minutes 62% 62% 61% 65% 67% 69% 70%
Emergency Preparedness:
8) % of households that believe they are "mostly prepared" or N/A 58% N/A 56% N/A 60% N/A
"completely prepared" for a 7 day emergency entailing
disruption of power and water services
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
Priority of Government
EFFECTIVE & EFFICIENT PUBLIC SERVICE DELIVERY
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Public Trust:
9) % of residents who believe the City is doing a "good" or 61% 56% N/A 55% N/A 60% N/A
"excellent" job of using tax dollars responsibly
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and
reported as a 2009 result.
Community Issues:
10) Most important problem facing Mercer Island today according
to the biennial citizen survey is (only top 5 results are listed):
► Traffic/transportation/parking 26% 28% N/A 26% N/A N/A N/A
► Education/school funding 7% 9% N/A 13% N/A N/A N/A
► Overcrowding/overdevelopment 28% 24% N/A 11% N/A N/A N/A
► Nothing 6% 10% N/A 10% N/A N/A N/A
► High taxes/high cost of living 6% 3% N/A 6% N/A N/A N/A
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
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D-28 City of Mercer Island 2011-2012 Budget
Budget Summary
Priority of Government
EFFECTIVE & EFFICIENT PUBLIC SERVICE DELIVERY
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Risk Management:
11) Total # of insurance claims filed over the past 5 years relative
to WCIA 5 year rolling average for Group 3/4 cities:
► Mercer Island 170 172 175 143 140 140 140
► Group 3 cities' average 99 100 96 90 100 100 100
► Group 4 cities' average 225 225 217 209 220 220 220
Employee Retention & Morale:
12) Employee longevity by department or department grouping:
► Police & Fire:
● Less than 5 years N/A 16% 18% 16% N/A N/A N/A
● At least 5 years but less than 10 years N/A 28% 22% 15% N/A N/A N/A
● At least 10 years N/A 56% 60% 69% N/A N/A N/A
► Maintenance and Parks & Recreation:
● Less than 5 years N/A 36% 32% 33% N/A N/A N/A
● At least 5 years but less than 10 years N/A 30% 31% 34% N/A N/A N/A
● At least 10 years N/A 34% 37% 33% N/A N/A N/A
► Development Services:
● Less than 5 years N/A 79% 82% 74% N/A N/A N/A
● At least 5 years but less than 10 years N/A 8% 9% 11% N/A N/A N/A
● At least 10 years N/A 13% 9% 15% N/A N/A N/A
► All other departments:
● Less than 5 years N/A 38% 42% 39% N/A N/A N/A
● At least 5 years but less than 10 years N/A 40% 33% 33% N/A N/A N/A
● At least 10 years N/A 22% 25% 28% N/A N/A N/A
Permit Processing:
13) % of DSG customers "satisfied" or "very satisfied" with the N/A 85% N/A 91% N/A 90% N/A
helpfulness and responsiveness of DSG staff in processing
single family residential and commercial/multi-family permits
Note: DSG conducts a customer survey biennially.
Court Operations:
14) Annual Municipal Court activity:
► # of cases filed (Mercer Island & Newcastle):
● Parking 509 719 542 363 325 325 325
● Infractions 2,980 3,206 3,244 2,852 2,600 2,600 2,600
● Criminal charges 442 430 556 580 500 500 500
● Total # of cases filed 3,931 4,355 4,342 3,795 3,425 3,425 3,425
► Total court-related revenues:
● Mercer Island $ 294,288 $ 319,303 $ 341,464 $ 353,732 $ 336,000 $ 360,000 $ 360,000
● Newcastle $ 40,964 $ 55,121 $ 40,704 $ 33,014 $ 34,000 $ 34,000 $ 34,000
● Total amount of court-related revenues $335,252 $374,424 $382,168 $386,746 $370,000 $394,000 $394,000
● % of court-related revenues to expenditures 125% 132% 118% 100% 93% 111% 107%
► # of RALJ (rules on appeal for courts of limited
jurisdiction) appeals filed related to:
● Infractions 1 0 0 0 0 0 0
● Criminal charges 0 0 0 1 0 0 0
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City of Mercer Island 2011-2012 Budget D-29
Budget Summary
Priority of Government
EFFECTIVE & EFFICIENT PUBLIC SERVICE DELIVERY
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Creditworthiness:
15) City's bond rating (Moody's):
► Unlimited Tax General Obligation (UTGO) bonds Aa1 Aa1 Aa1 Aa1 Aa1 Aa1 Aa1
► Limited Tax General Obligation (LTGO) bonds Aa2 Aa2 Aa2 Aa2 Aa2 Aa2 Aa2
Financial Management:
16) Receive unqualified (i.e. clean) audit opinion on prior year's Yes Yes Yes Yes Yes Yes Yes
financial statements
Financial Condition:
17) Ratio of tax revenues (i.e. property, sales, and utility taxes) to 1.09 1.12 1.07 1.01 0.98 1.01 1.00
personnel costs (i.e. salaries, hourly wages, overtime, and
benefits) in the General Fund
Environmental Stewardship:
18) Average City fleet fuel efficiency:
► Full-size, mid-size, compact & subcompact vehicles N/A 16.8 mpg 17.2 mpg 19.2 mpg 19.5 mpg 20.0 mpg 20.5 mpg
► Large/small SUV's, large/small pickup trucks & vans N/A 9.9 mpg 10.3 mpg 10.5 mpg 10.6 mpg 10.7 mpg 10.8 mpg
► Commercial vehicles (requires CDL) N/A 6.2 mpg 6.5 mpg 6.9 mpg 7.0 mpg 7.1 mpg 7.2 mpg
Note: Excludes all Police and Fire Department vehicles, except those used by command staff.
19) Estimated annual reduction in employee commute miles N/A N/A 264,945 mi 324,731 mi 340,968 mi 358,016 mi 375,917 mi
resulting from flex schedules, ride sharing, and biking (5% incr) (5% incr) (5% incr)
20) % change in energy (electricity and natural gas) usage for all City
owned buildings/facilities:
► Occupied buildings N/A 4.1% -0.9% -2.8% -5.0% -5.0% -2.0%
► Park facilities (including lighting) N/A 7.3% 11.0% 7.9% -5.0% -5.0% -2.0%
► Street lights N/A -12.3% 1.4% -7.6% -5.0% -5.0% -2.0%
► Water & sewer facilities N/A -6.9% -10.1% 2.9% -2.0% -2.0% -1.0%
► Total (all City owned buildings/facilities) N/A 1.7% -1.2% -1.6% -5.0% -5.0% -2.0%
21) % change in annual water consumption by:
► Average single family residential customer N/A -10.1% -4.1% 5.3% -2.0% -2.0% -2.0%
► City owned buildings & other facilities N/A 43.7% -31.0% 8.6% -2.0% -2.0% -2.0%
► City owned parks N/A 1.5% -18.2% 4.6% -2.0% -2.0% -2.0%
22) % of total Mercer Island residential solid waste stream diverted
from landfill relative to King County average
► Mercer Island N/A 63% 63% 63% 63% 65% 65%
► King County average N/A 53% 55% 54% N/A N/A N/A
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D-30 City of Mercer Island 2011-2012 Budget
Budget Summary
Priority of Government
RELIABLE PUBLIC INFRASTRUCTURE
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Infrastructure Condition--General Government:
23) % of residents who believe the City is doing a "good" or
"excellent" job of maintaining the City's:
► Streets N/A 76% N/A 72% N/A 80% N/A
► Sidewalks & pedestrian/bicycle paths N/A 66% N/A 65% N/A 70% N/A
► Parks, trails, and open space 87% 86% N/A 90% N/A 90% N/A
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
24) Pavement condition index (PCI) rating breakdown for
(noting centerline miles and % of total):
► Arterial streets:
● Failed (0-20 PCI) N/A 0.0 mi / 0% 0.0 mi / 0% 0.0 mi / 0% 0.0 mi / 0% 0.0 mi / 0% 0.0 mi / 0%
● Poor (21-48 PCI) N/A 0.3 mi / 1% 0.0 mi / 0% 0.6 mi / 2% 0.3 mi / 1% 0.3 mi / 1% 0.3 mi / 1%
● Fair (49-66 PCI) N/A 5.2 mi / 21% 4.7 mi / 19% 6.2 mi / 24% 6.4 mi / 25% 6.4 mi / 25% 6.4 mi / 25%
● Good (67-88 PCI) N/A 12.6 mi / 52% 12.6 mi / 52% 15.5 mi / 61% 15.0 mi / 59% 15.0 mi / 59% 15.0 mi / 59%
● Excellent (89-100 PCI) N/A 6.2 mi / 26% 7.0 mi / 29% 3.2 mi / 13% 3.8 mi / 15% 3.8 mi / 15% 3.8 mi / 15%
► Residential streets:
● Failed (0-20 PCI) N/A 0.6 mi / 1% 0.0 mi / 0% 0.0 mi / 0% 0.0 mi / 0%
18.0 mi / 18.0 mi /
● Poor (21-48 PCI) N/A 4.0 mi / 7% 2.7 mi / 5% 2.7 mi / 5% 2.7 mi / 5%
35% 35%
● Fair (49-66 PCI) N/A 5.2 mi / 10% 5.4 mi / 10% 5.4 mi / 10% 5.4 mi / 10%
● Good (67-88 PCI) N/A 34.0 mi / 34.0 mi / 16.7 mi / 31% 16.2 mi / 30% 16.2 mi / 30% 16.2 mi / 30%
● Excellent (89-100 PCI) N/A 65% 65% 27.5 mi / 51% 29.7 mi / 55% 29.7 mi / 55% 29.7 mi / 55%
Infrastructure Condition--Water Utility:
25) # of water main breaks per 1,000 service connections
relative to other Puget Sound cities and utility districts:
► Soos Creek Water & Sewer District N/A N/A 0.29 0.06 N/A N/A N/A
► Renton N/A N/A 2.04 0.23 N/A N/A N/A
► Northshore Utility District N/A N/A 0.29 0.30 N/A N/A N/A
► Cedar River Water & Sewer District N/A N/A 0.39 0.39 N/A N/A N/A
► Average (8 jurisdictions) N/A N/A 0.74 0.48 N/A N/A N/A
► Bellevue 0.50 0.50 0.70 0.60 N/A N/A N/A
► Mercer Island 1.20 1.20 1.07 0.67 0.80 0.80 0.80
► Bothell N/A N/A 0.75 0.75 N/A N/A N/A
► Shoreline Water District N/A N/A 0.35 0.82 N/A N/A N/A
Infrastructure Condition--Sewer Utility:
26) # of sewer system backups per 1,000 service connections
relative to other Puget Sound cities and utility districts:
► Cedar River Water & Sewer District N/A N/A 0.00 0.00 N/A N/A N/A
► Soos Creek Water & Sewer District N/A N/A 0.03 0.00 N/A N/A N/A
► Northshore Utility District N/A N/A 0.10 0.10 N/A N/A N/A
► Kirkland 0.00 0.00 0.00 0.20 N/A N/A N/A
► Average (8 jurisdictions) N/A N/A 0.30 0.24 N/A N/A N/A
► Bellevue 0.30 0.63 0.55 0.25 N/A N/A N/A
► Mercer Island 0.67 0.67 0.69 0.27 0.30 0.30 0.30
► Bothell N/A N/A 0.23 0.50 N/A N/A N/A
► Renton N/A N/A 0.76 0.60 N/A N/A N/A
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City of Mercer Island 2011-2012 Budget D-31
Budget Summary
Priority of Government
ATTRACTIVE, HIGH QUALITY NEIGHBORHOODS & BUSINESS DISTRICTS
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Neighborhood & Downtown Attractiveness:
27) # of code enforcement complaints received related to:
► Critical areas/shoreline 20 18 7 7 10 12 12
► No permit or expired permit 35 34 42 12 32 35 35
► Property encroachment 66 23 37 21 30 35 35
► Debris/vehicles 14 16 13 7 14 14 14
► Trees (topping/clearing/cutting) 20 24 15 27 15 20 20
► Other 21 59 28 35 52 39 39
► Total # of code enforcement complaints 176 174 142 109 153 155 155
28) % of residents "satisfied" or "very satisfied" with the overall N/A 71% N/A 77% N/A 80% N/A
appearance and condition of the City's Town Center
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
Economic Vitality:
29) Sales tax per capita (excluding significant, one-time receipts):
► Construction sector $56.93 $71.95 $71.64 $46.43 N/A N/A N/A
► Retail, wholesale & food services sectors $33.00 $37.84 $35.05 $36.46 N/A N/A N/A
► All other sectors $30.27 $28.88 $35.86 $30.45 N/A N/A N/A
► Total (all business sectors) $120.20 $138.68 $142.54 $113.34 $110.00 $113.32 $117.30
Priority of Government
RECREATIONAL, CULTURAL, HEALTH & EDUCATIONAL OPPORTUNITIES
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Recreational Programs & Facilities:
30) % of residents who believe the City is doing a "good" or
"excellent" job of:
► Providing recreation programs for youth, adults, and N/A 79% N/A 74% N/A 75% N/A
seniors
► Operating the Community Center N/A 75% N/A 74% N/A 75% N/A
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
Park Amenities:
31) % of residents "satisfied" or "very satisfied" with the available N/A 78% N/A N/A N/A 75% N/A
amenities at the City's parks (e.g. sports fields, sports courts,
playgrounds, restrooms, and picnic areas)
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result. This question was
mistakenly excluded from the February 2010 survey.
Youth Counseling & Intervention:
32) Counseling activity in middle/high schools:
► # of individual contacts 3,329 3,204 3,708 3,577 2,800 2,800 2,800
► # of parent consultations 501 503 485 448 450 400 400
► # of school staff consultations 850 994 823 808 700 700 700
► # of drug/alcohol assessments 23 43 17 14 20 20 20
_________________________________
D-32 City of Mercer Island 2011-2012 Budget
Budget Summary
Priority of Government
RECREATIONAL, CULTURAL, HEALTH & EDUCATIONAL OPPORTUNITIES
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Senior Outreach & Advocacy:
33) # of seniors and adult children served by Geriatric Specialist 354 290 343 320 250 375 275
Volunteerism & Human Services Funding:
34) Mercer Island Thrift Shop annual activity:
► # of volunteer service hours 15,869 15,394 14,621 14,558 15,000 15,000 15,000
► Gross sales revenue less excise taxes $596,633 $658,160 $651,376 $727,136 $815,000 $949,000 $995,000
► Net income $371,520 $398,821 $384,252 $445,839 $497,774 $631,898 $669,372
Priority of Government
PUBLIC COMMUNICATION & COMMUNITY INVOLVEMENT
Dashboard Results Target
Indicator 2006 2007 2008 2009 2010 2011 2012
Informed Citizenry:
35) % of residents "satisfied" or "very satisfied" with the City's efforts N/A 85% N/A 85% N/A 85% N/A
to keep them informed through a quarterly citizen newsletter,
a weekly electronic newsletter (subscription based), information
provided on the City's website, and Mercer Island Reporter
articles
Note: A citizen survey is conducted biennially. The most recent survey was conducted in February 2010 and reported as a 2009 result.
_________________________________
City of Mercer Island 2011-2012 Budget D-33
Budget Summary
_________________________________
D-34 City of Mercer Island 2011-2012 Budget
GENERAL FUND
Revenues
The General Fund is used
to account for general
purpose revenues, which
are used to fund general
governmental services,
excluding utilities.
Following are descriptions
of the City's major
revenue sources
accompanied by historical
tables and graphs.
General Fund
_________________________________
E-2 City of Mercer Island 2011-2012 Budget
General Fund
Revenue Summary
There are four major revenues that comprise 79% of the 2011-2012 General Fund budget: property
tax, sales tax, business and utility taxes, and license and permit fees. The table below breaks down
General Fund revenues by category for 2009-2012. Following that is a graph depicting the percentage of
each revenue source relative to the total amount budgeted in each year of the biennium.
2009 2010 2011 2012
Description Actual Forecast Budget Budget
RESOURCES
Budgeted
Beginning Fund Balance $ 752,231 $ 795,271 $ - $ -
Property Tax 9,820,771 10,064,568 10,163,579 10,367,735
Sales Tax 2,574,993 2,518,000 2,594,000 2,698,000
Business & Utility Taxes 3,415,597 3,366,000 3,510,000 3,684,000
State Shared Revenues 730,173 612,046 491,505 487,650
Utility Overhead 808,500 863,800 698,017 732,683
EMS Revenues 714,471 709,091 1,067,891 835,641
Licenses and Permits 1,609,719 1,544,225 1,826,120 1,852,120
General Government 441,586 392,289 383,212 389,250
Recreation Programs 1,237,584 1,197,590 1,350,997 1,414,281
District Court Fines 390,425 370,000 394,000 394,000
Interest 82,549 28,850 29,375 39,550
Interfund Transfers In 180,335 750,690 266,428 520,038
Total Budgeted Resources $ 22,758,933 $ 23,212,420 $ 22,775,124 $ 23,414,948
Not Budgeted
Beginning Fund Balance (Reserved) 3,059,553 2,264,282 2,264,282 2,264,282
TOTAL RESOURCES $ 25,818,486 $25,476,702 $ 25,039,406 $25,679,230
_________________________________
City of Mercer Island 2011-2012 Budget E-3
General Fund
2011 General Fund Revenues
Recreation Programs District Court Fines Interfund Transfers In
6% 2% 1%
General Government
2%
Licenses and Permits
8%
Property Tax
EMS Revenues 45%
5%
Utility Overhead
3%
State Shared Revenues
2%
Business & Utility Taxes
15%
Sales Tax
11%
2012 General Fund Revenues
District Court Fines
Recreation Programs 2%
6%
Interfund Transfers In
2%
General Government
2%
Licenses and Permits
8%
EMS Revenues Property Tax
4% 44%
Utility Overhead
3%
State Shared Revenues
2%
Business & Utility Taxes
16%
Sales Tax
11%
_________________________________
E-4 City of Mercer Island 2011-2012 Budget
General Fund
Property Tax
Property tax plays an essential role in financing the general government operations of the City of Mercer
Island, accounting for almost 45% of total General Fund budgeted resources in 2011-2012. In 2011,
Mercer Island property owners will pay a total of $10,163,579 in property taxes to support general
government operations in the General Fund.
There are two types of property tax collected by the City: regular levy and voter approved levy. The
regular levy portion may be used for any purpose that the City deems appropriate. In Mercer Island, as
in most cities, the property tax levy primarily supports the General Fund, which is where most of the
City’s general government operations are budgeted and accounted for. Voter approved levies are for
specific purposes, such as funding new park capital improvements and/or park operations and
maintenance, and may not be used for any purpose other than what the voters approved. For
information about the voter approved taxes levied by the City, see the Property Tax policy in Section C
(Budget Policies).
Each November, as required by Washington State law, the City Council sets the property tax levy for
the coming year. Up until November 1997, this levy was restricted to a maximum of 106 percent of the
previous year's levy plus the amount associated with “new construction” (i.e. additions to the property
tax rolls). However, in 1997, the Washington State Legislature passed Referendum 47 on to the voters
of the state who in turn approved it by a 60% majority. This referendum set a limit on property tax
increases of the lesser of 106% or the rate of inflation, whichever was less. In 2001, Initiative 747 passed in
the State which further changed the property tax law. Initiative 747 limits the property tax levy to a
maximum of 101% of the previous year’s levy, or the rate of inflation, whichever is less. Since the rate
of inflation is normally above 1%, the effective limit on the property tax levy increase will normally be
1%. The initiative also allows higher property tax increases if approved by the voters, a provision that
was already in the statutes. Beginning in 1995, before the state law was changed, the Council decided to
begin ramping down the property tax increases by 0.5% per year, with the goal of eventually matching
the inflation rate. The Council reached that goal in 1999. Below is a table and chart of the General
Fund property tax receipts since 1993, including the budgeted tax amounts for 2011 and 2012.
Year Amount % Change Year Amount % Change
1993 $ 4,701,000 2003 $ 7,776,612 2.3%
1994 5,083,656 8.1% 2004 8,416,000 8.2%
1995 5,344,355 5.1% 2005 8,518,954 1.2%
1996 5,824,072 9.0% 2006 8,925,023 4.8%
1997 6,065,315 4.1% 2007 9,305,222 4.3%
1998 6,500,000 7.2% 2008 9,418,055 1.2%
1999 6,849,930 5.4% 2009 9,820,771 4.3%
2000 7,158,934 4.5% 2010 10,064,568 2.5%
2001 7,397,242 3.3% 2011 10,163,579 1.6%
2002 7,602,108 2.8% 2012 10,367,735 2.0%
_________________________________
City of Mercer Island 2011-2012 Budget E-5
General Fund
Property Tax Revenues: 1993-2012
12,000,000
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
-
Sales Tax
Until 2000, sales tax revenue was made up of two components—regular sales tax and "sales tax
equalization". Combined, these revenues accounted for about 16% of the 1999 General Fund budget. In
1999, however, an initiative changed the law and the City no longer receives sales tax equalization (see
discussion below). Sales tax revenue is estimated to be almost 12% of total budgeted resources in
2011-2012.
• Sales and Use Tax: Cities and towns are authorized under 1970 state law to levy a sales and
use tax of one-half cent per dollar. In 1982, the State authorized an additional half-cent sales
and use tax for cities and towns. Mercer Island levies the full amount allowed.
• Sales Tax Equalization: The law that provided for "Sales Tax Equalization" went into effect
in 1983. The purpose of sales tax equalization was to provide a means for guaranteeing a
minimum amount of sales tax to each city and town in Washington. That allowed cities with
little commercial activity to receive, through a combination of the sales tax it "earns" and
equalization, at least 70 percent of the statewide average per capita sales tax. The amount of
sales tax equalization each city received was computed on their prior year's sales tax receipts.
In 1999, however, Initiative 695 was passed by the voters which eliminated the Motor Vehicle
Excise Tax, which was the source of funds for the distribution of sales tax equalization dollars.
The effect of the initiative was to bring Mercer Island’s total “sales tax” receipts back to the
same level that they had been in 1987. This change resulted in a loss of about $1,000,000 in
revenue per year.
As illustrated in the chart that follows, the City’s sales tax, even with equalization, was very uneven and
fairly unpredictable. Because of the uncertainty of equalization and the economy during the mid-1990’s,
the City has historically used a very conservative figure for predicting sales tax during each biennial
_________________________________
E-6 City of Mercer Island 2011-2012 Budget
General Fund
budget. This conservative approach helped the City weather the demise of the sales tax equalization
revenue.
As was done for 2009-2010, the sales tax revenue budgeted in 2011-2012 is primarily based on the
current and projected development activity levels in the City, taking into account building permits that
have been issued to date as well as those that are expected to be issued by mid-2011. In addition, any
new retail square footage in the Town Center is incorporated into the projection. Construction-related
sales tax makes up anywhere from one-third to one-half of the City’s total sales tax receipts, depending
on the level of development activity on the Island, which is why so much attention is paid to
development activity in the sales tax forecast.
In 2009, sales tax revenue was down 30.1%, or almost $1.11 million, compared to 2008. However, total
sales tax revenue in 2008 included $455,000 in unexpected receipts from two non-classified businesses.
Factoring out these extraordinary receipts, actual revenue was down 20.2 percent, or almost $654,000,
in 2009. Of particular note, the “construction” sector was down 35.0% in 2009 after hitting an all time
high in 2007 and leveling off in 2008. Looking at the first half of 2010, sales tax revenue was down 4.9%,
or about $64,000, compared to the same period in 2009. The overall decrease of 4.9% can be primarily
attributed to the “construction” sector, which was down 14.1% relative to the same period in 2009. As
a result, this sector has declined from 50.3% of the City’s total sales tax receipts as of December 31,
2008 to 36.6% as of June 30, 2010. Based on what’s currently in the Development Services Group’s
(DSG) pipeline, significant improvement in development activity is currently underway for single family
residential projects, but no improvement is expected for commercial/multi-family projects until the first
quarter of 2011. Overall, development activity is expected to be flat in 2011-2012 relative to 2010.
Helping counteract the decline in construction-related sales tax is the enactment of the Streamlined
Sales Tax measure by the state legislature in 2007, which took effect on July 1, 2008. As a result,
destination-based sales tax revenues not only from Washington state businesses but also from
participating mail order and internet based businesses began flowing to the City in September 2008. In
2010, it is estimated that the City will receive about $185,000 from this revenue source.
Following is a table and chart containing actual sales tax receipts for 1993-2009 and projected receipts
for 2010-2012, broken down into “regular” sales tax and “equalization” components.
Year Sales Tax Equalization Total % Change Year Sales Tax Equalization Total % Change
1993 1,350,470 797,437 2,147,907 2003 2,685,252 - 2,685,252 -14%
1994 1,254,845 965,135 2,219,980 3% 2004 2,565,501 - 2,565,501 -4%
1995 1,352,936 1,107,887 2,460,823 11% 2005 2,643,672 - 2,643,672 3%
1996 1,321,582 868,634 2,190,216 -11% 2006 2,627,513 - 2,627,513 -1%
1997 1,506,579 966,245 2,472,824 13% 2007 3,949,552 - 3,949,552 50%
1998 1,570,792 896,194 2,466,986 0% 2008 3,683,977 - 3,675,000 -7%
1999 1,845,161 968,395 2,813,556 14% 2009 2,574,993 - 2,574,993 -30%
2000 2,890,410 158,178 3,048,588 8% 2010 2,518,000 - 2,518,000 -2%
2001 4,356,551 - 4,356,551 43% 2011 2,594,000 - 2,594,000 3%
2002 3,128,841 - 3,128,841 -28% 2012 2,698,000 - 2,698,000 4%
_________________________________
City of Mercer Island 2011-2012 Budget E-7
General Fund
Sales Tax and Equalization Receipts: 1993-2012
Utility Taxes
This revenue category comprises almost 16% of total budgeted resources in 2011-2012. The City
charges a tax on the gross receipts of the public and private utilities doing business on Mercer Island.
Cities are limited by state law to charging no more than 6% on electric power, gas, and telephone
utilities. Puget Sound Energy, US West (Quest), AT&T, and a variety of small long distance carriers are
subject to a 6% tax rate. Two other major utilities, Eastside Disposal and Comcast Cable, are subject to
a 7% tax rate. In 2010, the City implemented a water utility tax of 1.7% to offset the fire
hydrant/protection costs that had previously been funded by water utility rates. Because Mercer Island
has had a low housing growth rate, revenue growth from utility taxes is highly dependent on utility rate
increases and weather conditions that affect the use of gas and electric heat.
Year Amount % Change Year Amount % Change
1993 $ 1,311,219 2003 $ 2,266,195 -5.9%
1994 1,365,000 4.1% 2004 2,325,000 2.6%
1995 1,440,317 5.5% 2005 2,695,376 15.9%
1996 1,621,913 12.6% 2006 2,891,000 7.3%
1997 1,663,792 2.6% 2007 3,223,613 11.5%
1998 1,687,617 1.4% 2008 3,377,374 4.8%
1999 1,898,546 12.5% 2009 3,415,597 1.1%
2000 1,967,000 3.6% 2010 3,366,000 -1.5%
2001 2,337,863 18.9% 2011 3,510,000 4.3%
2002 2,409,176 3.1% 2012 3,684,000 5.0%
_________________________________
E-8 City of Mercer Island 2011-2012 Budget
General Fund
Utility Taxes: 1993-2012
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
-
Shared Revenues
This revenue category consists of both State shared revenues as well as grants and other revenues from
King County and the Federal Government. It comprises about 2% of total budgeted resources in 2011-
2012. Below is a brief description of each of the major components.
• Liquor Excise Tax and Liquor Profits – Liquor sales are taxed at the rate of 15% on the
sales price for individuals and 11.4% for Class H licenses. Cities and towns split 28% of the total
collected based on population. Additionally, 32% of the tax imposed on wine sales (75 cents per
gallon) is allocated to cities and towns. The profits of the Liquor Control Board are divided
among the state, counties, and cities (after deducting a fixed amount for alcoholism research).
The cities split 40% based on population. Over the years, the per capita amount has declined as
more cities have incorporated, thereby reducing the amount received by each city.
• Marine Patrol Revenue – Revenue for marine patrol services provided by Mercer Island is
included in this category and comes from two sources. First, the City receives revenue from
the cities that contract with the Mercer Island Police Department for marine patrol services.
Second, Mercer Island receives a portion of the vessel registration fees collected by the State of
Washington and passed on to the City through King County, because it provides marine patrol
services.
• Grants – Sources of grant revenue include federal grants, state grants, and local grants.
Typically, these monies are one-time funding sources for specific purposes.
Actual revenues for 1993-2009 and estimated revenues for 2010-2012 are displayed in the table and
graph that follow. Because there is so much variability in each of these sources, each individual
component of shared revenues is reviewed and then forecast individually.
_________________________________
City of Mercer Island 2011-2012 Budget E-9
General Fund
Year Amount % Change Year Amount % Change
1993 $ 997,875 2003 461,495 -41.2%
1994 764,355 -23.4% 2004 468,182 1.4%
1995 718,302 -6.0% 2005 495,451 5.8%
1996 652,101 -9.2% 2006 494,660 -0.2%
1997 676,706 3.8% 2007 678,936 37.3%
1998 710,930 5.1% 2008 696,208 2.5%
1999 665,536 -6.4% 2009 730,173 4.9%
2000 568,743 -14.5% 2010 612,046 -16.2%
2001 844,115 48.4% 2011 491,505 -19.7%
2002 785,431 -7.0% 2012 487,650 -0.8%
Shared Revenues: 1993-2012
1,200,000
1,000,000
800,000
600,000
400,000
200,000
-
Licenses, Permits, and Zoning Fees
Licenses, permits, and zoning fees represent about 8.0% of total budgeted resources in 2011-2012. This
revenue category consists of all fees related to development, cable franchises, and business licenses.
Development activity, both locally and regionally, has slowed significantly from the record pace that
peaked in 2007. Relative to the first half of 2009, single family residential development was up 42.4% for
the first half of 2010 as measured by the number building permits issued. Also, the total valuation for all
building permits (i.e. residential, multi-family, commercial, public, and mixed use) was up 87.5%
compared to 2009. As noted above in the Sales Tax section, Development Services staff expects
development activity overall to remain steady in 2011-2012 compared to 2010. Finally, cable franchise
fees are projected to grow 5-6% annually and business license fees are projected to be flat in 2011-2012.
Actual revenues for 1993-2009 and estimated revenues for 2010-2012 are displayed in the table and
graph that follow.
_________________________________
E-10 City of Mercer Island 2011-2012 Budget
General Fund
Year Amount % Change Year Amount % Change
1993 $ 324,664 2003 1,263,956 5.9%
1994 450,539 38.8% 2004 1,420,500 12.4%
1995 464,478 3.1% 2005 2,098,943 47.8%
1996 552,463 18.9% 2006 2,034,500 -3.1%
1997 650,711 17.8% 2007 2,249,083 10.5%
1998 694,865 6.8% 2008 1,844,201 -18.0%
1999 1,068,026 53.7% 2009 1,609,719 -12.7%
2000 1,183,300 10.8% 2010 1,544,225 -4.1%
2001 1,382,951 16.9% 2011 1,826,120 18.3%
2002 1,193,398 -13.7% 2012 1,852,120 1.4%
License, Permit & Zoning Fees: 1993-2012
2,500,000
2,000,000
1,500,000
1,000,000
500,000
-
Utility Overhead Charges
Utility overhead charges make up about 3% of total budgeted resources in 2011-2012. These charges
include administrative support costs, building maintenance costs (for the Maintenance Center and City
Hall), and liability and property insurance costs which are initially paid for by the General Fund. They
are accounted for as interfund charges by the General Fund to the each of the City’s utility funds (water,
sewer, and storm water). The administrative support component of the charges encompasses a
specified percentage of the City Manager’s Office, the City Attorney’s Office, the Finance Department,
the Human Resources Department, and the City Council’s budget. Additional information regarding
these interfund charges is provided in the Utility Overhead Charges policy in Section C (Budget
Policies). Prior to 1995, staff project engineering time was included in the utility overhead charge rather
_________________________________
City of Mercer Island 2011-2012 Budget E-11
General Fund
than charged directly to the capital projects of each utility, which is what happens currently. From 1995
to 2008, the charges have remained relatively flat. For the 2011-2012 biennium, the model was updated
and some allocation methods were changed, resulting in a19.2% decrease in the charge from 2010 to
2011. Actual interfund charges for 1993-2012 are displayed in the table and graph that follow.
Year Amount % Change Year Amount % Change
1993 $ 926,293 2003 $ 682,727 6%
1994 949,487 2.5% 2004 688,565 0.9%
1995 643,180 -32.3% 2005 693,571 0.7%
1996 665,180 3.4% 2006 698,532 0.7%
1997 678,080 1.9% 2007 716,000 2.5%
1998 644,004 -5.0% 2008 739,400 3.3%
1999 649,072 0.8% 2009 808,500 9.3%
2000 655,192 0.9% 2010 863,800 6.8%
2001 640,779 -2.2% 2011 698,017 -19.2%
2002 645,186 0.7% 2012 732,683 5.0%
Water & Sewer Utility Overhead Charges: 1993-2012
1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
-
_________________________________
E-12 City of Mercer Island 2011-2012 Budget
General Fund
All Other Revenues
All the remaining revenue categories comprise about 15% of the total budgeted resources in 2011-2012.
Following is a brief description of the remaining revenue categories.
• Interfund Transfers In – This category includes amounts transferred in from other funds in
support of General Fund operating expenditures.
• Emergency Medical Service (EMS) Revenues – Beginning in 1990, the City began receiving
a portion of the 25 cent property tax levy that was voted on by the citizens for 911 emergency
service. At that time, the City reduced its EMS fee so that Mercer Islander taxpayers would pay
roughly the same as they did before the new law. In 1996, when the City decided to add 4 new
firefighters because of the high volume of aid calls, the fee was increased to help pay for that
enhanced level of service.
• Recreation Programs – This category includes the fees that are charged for recreation
programs offered by the City as well as fees charged at the Community Center. The fee
structure now in place recovers about 45% of the cost of those programs. See the Parks &
Recreation Financing policy in Section C (Budget Policies) for more information.
• Ambulance Transport Fee – Beginning February 2011, the Fire Department will begin
charging a fee for transporting patients requiring non-emergency, basic life support, to hospitals.
The fee will be used to support ongoing General Fund services.
• Interest – The money of the City is pooled for investment purposes and allocated to various
funds per the Investment Earnings policy in Section C (Budget Policies).
• Beginning Fund Balance – This consists of several reserves (revenue stabilization,
emergency, and LEOFF I long-term care), surplus revenues and expenditure savings from a prior
year, and dedicated funding for one-time costs and expenditure carryovers. For 2011-2012,
there is no “budgeted” beginning fund balance, reflecting the expectation there will be no
General Fund surplus in 2010 available for funding 2011-2012 expenditures.
_________________________________
City of Mercer Island 2011-2012 Budget E-13
General Fund
_________________________________
E-14 City of Mercer Island 2011-2012 Budget
GENERAL FUND
Expenditures
The General Fund is the
general operating fund of
the City and encompasses
the following major
activities, excluding
utilities: fire and police
services, street and park
maintenance,
development services,
court services, recreation
services, legal services,
financial services, and
general administration. In
this section the
expenditures are shown
by major functional
category.
General Fund
_________________________________
E-16 City of Mercer Island 2011-2012 Budget
General Fund
Budget Analysis
A summary analysis follows comparing the 2010 Approved Budget to the 2011-2012 Final Budget,
broken down by year, with “Other Significant Changes,” “Service Enhancements,” and “Service
Reductions” separately identified for 2011 and 2012.
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 24,980,070
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers (679,811)
Salary and Benefit savings (relative to 2010 budget) (336,550)
Salary Savings (no COLA in 2011) (115,236)
Jail costs (119,015)
Reduce annual technology CIP funding (100,000)
NORCOM fees (59,293)
Travel and training (39,199)
Marine patrol program (39,174)
Move Town Center utility costs to Beautification Fund (34,000)
Advertising & postage (32,691)
Other non-service level reductions (20,336)
Telephone costs (25,025)
Reduce annual YFS subsidy (25,000)
Police and Fire overtime 96,954
Subtotal (1,528,376) -6.1%
2011 Base Budget 23,451,694 -6.1%
Plus 2011 Service Enhancements:
Total one-time costs 108,559
Total ongoing costs 63,100
Subtotal 171,659
Less 2011 Service Reductions:
Total one-time savings (130,352)
Total ongoing savings (717,877) 0.0%
Subtotal (848,229)
2011 Final Budget 22,775,124 -8.8%
_________________________________
City of Mercer Island 2011-2012 Budget E-17
General Fund
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 22,775,124
Plus 2012 General Inflationary Increases 683,448 3.0%
Plus (Less) 2012 Other Significant Changes:
Prior year one-time costs (service packages with
costs in 2011 only) (23,624)
Subtotal (23,624) -0.1%
2012 Base Budget 23,434,948 2.9%
Plus 2012 Service Enhancements:
Total one-time costs (20,000)
Total ongoing costs -
Subtotal (20,000)
Less 2012 Service Reductions: 0.0%
Total ongoing savings -
Subtotal -
2012 Final Budget 23,414,948 2.8%
Expenditure Summary
Presented in the table below are expenditures by category for 2009-2011, followed by two pie charts
depicting the percentage of each category relative to total budgeted expenditures in 2011 and 2012.
2009 2010 2011 2012
Description Actual Forecast Budget Budget
USES
Budgeted
Salaries 12,087,058 12,964,794 12,133,311 12,330,624
Benefits 3,738,774 4,240,247 3,938,176 4,304,292
Supplies 629,953 754,419 684,508 664,956
Contractual Services 1,514,103 1,861,919 1,515,834 1,482,613
Equipment Rental 1,201,535 1,215,805 1,219,958 1,220,658
Utilities & Insurance 1,162,392 1,236,430 1,307,113 1,398,767
Other Services and Charges 656,463 794,345 494,095 509,005
Intergovernmental 669,913 875,831 807,792 827,096
Interfund Transfers 1,098,743 1,036,280 674,337 676,937
Total Budgeted Expenditures $ 22,758,933 $ 24,980,069 $ 22,775,124 $ 23,414,948
Not Budgeted - - - -
Budget Cuts and Expenditure Savings (1,767,649)
Ending Fund Balance 3,059,553 2,264,282 2,264,282 2,264,282
TOTAL USES $ 25,818,486 $ 25,476,702 $ 25,039,406 $ 25,679,230
_________________________________
E-18 City of Mercer Island 2011-2012 Budget
General Fund
2011 General Fund Expenditures
Other Services and Intergovernmental
Charges 4% Interfund Transfers
2% 3%
Utilities & Insurance
6%
Equipment Rental
5%
Salaries
53%
Contractual Services
7%
Supplies
3%
Benefits
17%
2012 General Fund Expenditures
Intergovernmental
Other Services and 4%
Charges Interfund Transfers
2% 3%
Utilities & Insurance
6%
Equipment Rental
5% Salaries
53%
Contractual Services
6%
Supplies
3%
Benefits
18%
_________________________________
City of Mercer Island 2011-2012 Budget E-19
General Fund
Salaries and Benefits
The largest expenditure categories are salaries and benefits, which together comprise almost 71% of the
2011-2012 Budget. Annual salary increases are driven by annual cost of living and step increases
bargained by the City’s unions, which cover about 65% of all City employees. Included in the salary
category are permanent full-time and part-time employees, contract employees, and casual labor used by
the Maintenance and Parks & Recreation Departments. General Fund salaries and benefits are budgeted
at a total cost of $16.1 million in 2011 and $16.6 million in 2012. The $1.1 million reduction in salaries
and benefits in 2011 relative to 2010 is directly related to service level reductions in 2011, to one-time
service enhancements that lapse at the end of 2010 and which aren’t re-budgeted in 2011, and to salary
savings resulting from a reduced or no COLA (cost of living adjustment) in 2010 and no COLA in 2011.
The $563,429 budgeted increase in salaries and benefits in 2012 is wholly attributable to an estimated
COLA of 1.35-1.50% (depending on the bargaining unit), annual step increases included in the City’s
labor contracts, a significant increase in the PERS (Public Employee Retirement System) contribution
rate required of public employers, and a 10% projected increase in medical insurance premiums. See the
Long Term Compensation policy in Section C (Budget Policies) for more information.
Salary and Benefit Costs: 1997-2012
20,000,000
18,000,000
16,000,000
14,000,000
12,000,000
10,000,000
8,000,000
6,000,000
Benefits
4,000,000
Salaries
2,000,000
-
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Supplies
The supplies category includes most office, operating, and maintenance items that employees need to
fulfill their job responsibilities. Common examples include paper, printer and copier toner, cleaning
supplies, fuel and oil, sand, gravel and fertilizer. As a percentage of total budgeted expenditures this
category has consistently hovered around 3.0%. This trend continues in the 2011-2012 Budget.
Utilities
The utilities category includes all the major utility costs – water, sewer, storm water, electricity and gas.
Also included is the cost of dumping waste (e.g. from excavations and cleaning of ditches). For 2011, the
following utility rate increases are expected: 9.5% for water, 9.3% for sewer, 3.3% for stormwater, 2%
for electricity and 2% for gas. Given these significant rate increases, the City continues to promote
conservation efforts by all departments.
_________________________________
E-20 City of Mercer Island 2011-2012 Budget
General Fund
Insurance
The City buys all liability and property insurance through the Washington Cities Insurance Authority
(WCIA). WCIA is mostly self insured for liability purposes and has been building a cash reserve from
the member cities over the past 10 years to help keep premium costs down and to provide a higher
amount of liability coverage. Liability insurance premiums are based on a combination of number of
worker hours and the City’s actual liability claims over the past 5 years.
Supplies, Utilities, and Insurance Costs: 1997-2012
2,500,000
2,000,000
1,500,000
Insurance
Utilities
1,000,000
Supplies
500,000
-
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Contractual Services
This category includes all the individuals and firms with which the city contracts for services. Included
are the following: consultants, landscaping services, janitorial services, outside legal services, and
recreational class instructors. Below is a graph of contracted services expenditures for the period
1997-2012.
Contractual Services: 1997-2010
2,500,000
2,000,000
1,500,000
1,000,000
500,000
-
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
_________________________________
City of Mercer Island 2011-2012 Budget E-21
General Fund
Equipment Rental
This category includes "rental and replacement charges" assessed to each department by the Equipment
Rental Fund for the City’s vehicle fleet and by the Computer Equipment Fund for the City’s computers.
Replacement cost, useful life, salvage value, and department needs are assessed biennially when the rates
are established. For the 2011-2012 biennium, these internal charges are being kept flat overall relative
to the 2009-2010 biennium. See the Reserves—Equipment Replacement policy in Section C (Budget
Policies) for more information.
Equipment Rental: 1997-2012
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
-
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Other Services and Charges
This category consists of a variety of miscellaneous payments, including advertising, printing, travel,
communications, postage, subscriptions, tuition and registrations, election costs, copying, and
miscellaneous charges.
Intergovernmental
This category includes charges for services from other governmental agencies. Examples include
mandatory contributions to the King County Alcoholism program and Puget Sound Clean Air Agency
and voluntary payments in support of regional associations. Expenditures in this category have typically
been quite modest with small increases from year to year.
Interfund Transfers
Interfund transfers consist of two types: 1) transfers to fund ongoing costs/programs; and 2) transfers
to fund significant one-time operating or capital costs. Transfers for ongoing costs/programs are
ultimately funded by the general revenues of the City. Transfers for one-time operating or capital costs
are funded by the General Fund’s prior year’s surplus, which is generated by excess revenues over what
was budgeted and expenditure savings. The disposition of the prior year’s surplus is usually finalized by
the Council in June.
There are two long standing, ongoing annual transfers budgeted again in 2011-2012, though they have
been reduced due to the projected revenue shortfalls: 1) a $150,000 transfer to the Technology &
_________________________________
E-22 City of Mercer Island 2011-2012 Budget
General Fund
Equipment Fund to support the City’s technology projects and to fund the purchase of larger pieces of
equipment that are outside the scope of departmental budgets (reduced from $250,000); and 2) a
$320,000 transfer to the Youth & Family Services Fund to help support ongoing program costs (reduced
from $465,000). See the YFS Financing policy in Section C (Budget Policies) for more information.
_________________________________
City of Mercer Island 2011-2012 Budget E-23
General Fund
_________________________________
E-24 City of Mercer Island 2011-2012 Budget
UTILITY FUNDS SUMMARY
The following pages
contain important
information about the
utilities as a whole.
This section identifies
the emerging issues
for each utility,
followed by a brief
discussion of their
operation,
maintenance and
capital reinvestment
programs. The
proposed utility rates
for 2011 and 2012
and the underlying
cost drivers are
discussed. Finally,
income statements
are presented for the
Water, Sewer, and
Storm Water Utilities.
_________________________________
City of Mercer Island 2011-2012 Budget
Utility Funds Summary
_________________________________
F-2 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
Emerging Issues for the Utilities
During the 2011-2012 biennium, Mercer Island’s utilities will experience fiscal impacts caused by
developments elsewhere in the region and new state and federal regulations. The continued pace of
development in the greater Puget Sound area is driving local governments to plan and develop new
utility infrastructure, manage endangered natural resources, and find ways to make our resources more
sustainable. Each of the City’s utilities will be affected differently. A major focus for the City’s utilities,
like utilities throughout our region in the post 9-11 and Hurricane Katrina era, is preparing for a major
disaster or emergency. The following summarizes the emerging issues on the horizon for each utility.
Sanitary Sewer
King County completed a Regional Wastewater Services Plan (RWSP) in 1999, describing the need for
extra capacity to meet the demands of rapid population growth. The Plan addresses how to meet these
demands while protecting public health and our valuable water resources. The RWSP outlines a number
of important projects and programs that King County will implement over the next 30 years and work
that is already well underway. King County started construction of the new Brightwater Treatment
Plant in 2006 and it is anticipated that the Plant will start-up and operations will begin in 2011, with the
entire system scheduled to be completed in 2012. The new facilities will include a treatment plant,
conveyance (pipes and pumps taking wastewater to and from the plant), and a marine outfall, which will
improve the conveyance system in the north end of the County. The operation and maintenance of the
King County Wastewater collection and treatment facility, as well as new projects to increase system
capacity, drive the King County Sewage Treatment rates paid by City of Mercer Island utility customers.
King County is attempting to control the growing demand for sewage treatment capacity in the region
through a new Regional Inflow/Infiltration (I/I) Control Program that was included in the 1999 Regional
Wastewater Services Plan (RWSP). I/I is a term used to describe clean storm runoff and/or
groundwater that enters the sewer system through cracked pipes, leaky manholes, or improperly
connected roof drains, storm drains, and parking lot connections. Most inflow comes from storm water
and most infiltration comes from groundwater. I/I has a major effect on the size of King County’s
conveyance and treatment systems and, ultimately, the rates businesses and residents pay to operate
and maintain them.
This I/I Control Program is designed to determine where I/I comes from, establish that it is cost-
effective to remove I/I, and recommend actions to actively control I/I in the future. The program is
based on a cooperative partnership between King County and 34 local component agencies including
Mercer Island.
Ten pilot projects were completed within King County’s service area at a cost of approximately $13.2
million funded by King County through sewer rates. Mercer Island was the recipient of one such
project in 2003. About 16,000 linear feet of leaky mains were lined at a cost of $1.2 million in the East
Seattle neighborhood on Mercer Island. The purpose of the pilot projects was to evaluate the
effectiveness of various rehabilitation techniques and to document the effectiveness of specific pilot
projects in reducing excessive I/I flows in the King County conveyance and treatment system. Successes
can be used as models for future projects. In 2007-2008, King County conducted an I/I reduction
feasibility analysis in four candidate project areas (Bellevue, Issaquah, Renton, and Skyway). During
2011-12 King County will construct initial I/I reduction projects in Skyway, Bellevue, and Issaquah. These
projects will test the cost-effectiveness of I/I reduction on a scale large enough to potentially offset the
need for larger conveyance or storage facilities.
_________________________________
City of Mercer Island 2011-2012 Budget F-3
Utility Funds Summary
An update of the City's General Sewer Plan was completed in 2002. The Plan has been used as a guide
for capital budget planning including this budget. In anticipation of the 2011-2016 Budget development,
staff prepared a more detailed capital spending plan than provided in the General Sewer Plan. The Plan
is relevant and current and is not expected to require a major update for years to come. Unlike the
Department of Health’s requirement to update Water System Plans every six years, the Sewer Plan
must be updated only when it is no longer considered current due to changes in regulations, system
needs, growth patterns, or other factors.
The long-anticipated Sewer Lake Line Replacement Project is expected to be complete in 2011. The
feasibility study for the project was completed in 2002. Design and permitting continued throughout the
following two biennia at a cost of $2.1 million. Permitting for this work in Lake Washington was a
challenge as a result of the recent listing of the Puget Sound Chinook salmon as a threatened species
under the Endangered Species Act and the issuance of the 4d rule. In July 2007, the City opened bids to
construct the project and received a low bid of $27.4 million. Adding costs for contingency,
construction management, project management, and mitigation, the total construction cost was
estimated to be $32.1 million. This cost far exceeded the estimated $15 million construction cost. On
September 17, 2007, the City Council rejected all Sewer Lake Line bids and directed staff to proceed
with a peer review and project re-assessment. This process included re-visiting the original in-lake
design approach, re-assessing pipe condition, exploring minimizing trenching for the in-lake Sewer Line,
and bidding the Pump Station separately from the in-lake Sewer Line work. The peer review,
reassessment, and redesign work completed in 2007-2008 cost an additional $393,320. On May 19,
2008, the Council reviewed project re-assessment work and directed staff to proceed with re-designing
and re-packaging the Sewer Lake Line project with a goal of going to bid in October 2008. The project
includes Reach 3 and Pump Station 4. Reach 4 was deleted for future construction. The City awarded
construction contracts on December 1, 2008 for the Lake Line to Manson Construction for $14.8
million and for Pump Station 4 to Stellar J for $4.3 million. Adding costs for contingency, construction
management, project management, and mitigation, the total construction budget was set at $24.2M in
February 2009. The Lake Line will be the Island's most expensive sewer capital project.
A sewer rate analysis was conducted in 2003 and has been reviewed annually since then. The analysis
looked at the rate impacts of the capital projects identified in the General Sewer Plan, particularly the
Lake Line Replacement Project, as well as operation and maintenance costs associated with the utility.
This was the first formal rate analysis and rate increase in a decade. Annual rate increases between 9%
and 18.1% have been implemented between 2004 and 2010 to provide funding for the Sewer Fund, and
specifically the Sewer Lake Line project.
For the last 6 years, capital funding has been focused on the Sewer Lake Line, with a minimum amount
of funding dedicated to reinvestment in the rest of the system. Starting in 2011, the City will begin to
increase funding for more routine reinvestment in lining or repairing sewer lines, upgrading pump
stations and replacing obsolete generators. Another driver to increase the level of capital reinvestment
is the reduction of sewer back-ups into homes (the City has received a few costly insurance claims in
the last 5 years). An attempt to reduce backups will require greater reinvestment in the sewer
collection system. Also, in the last couple of years backups in the Sewer Lake Line have started
occurring at a greater frequency. In response, an action plan is being developed that addresses both
capital improvements and operational changes that should act to reduce backups. Capital reinvestment
levels are expected to increase from close to $600K in 2011 to slightly over $1M in 2016.
_________________________________
F-4 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
Solid Waste
The King County Solid Waste Division remains the primary provider of waste transfer and landfill
services for suburban cities. Collection services, including garbage recycling and yard waste, on the
Island are provided under the City's contract with Allied Waste. A new long-term contract with Allied
was negotiated and approved in 2009. The County provides grant funding that provides the two special
recycling events held each year on Mercer Island.
King County’s 2001 Comprehensive Solid Waste Management Plan is in the process of being updated. A
preliminary draft of the Comprehensive Plan was ready for review at the end of 2009. The update
process should be completed in 2011. The plan will reflect major policy decisions being made as part of
the development of the Transfer and Waste Export System Plan in 2006. The Export Plan provides a
blueprint for the future of the County’s solid waste system as the County prepares to begin exporting
waste when the Cedar Hills Regional Landfill closes in several years. The plan was developed in
collaboration with cities served by the County system through the Metropolitan Solid Waste
Management Advisory Committee.
The update of the Comprehensive Plan is expected to call for the expansion and modernization of
several Transfer Stations, including the Factoria Transfer Station in the next 5 years. This upgrade will
allow additional services to be provided that will benefit Island residents, such as expanded collection of
bulky yard debris. A relatively new service benefiting Island residents, the collection of household
hazardous waste, became available at the Factoria Transfer Station in September of 2002 and continues
to be a highly popular feature of the transfer station. The Plan update process has analyzed whether to
change the County’s waste reduction and recycling goals. With growing interest in sustainability, it is
anticipated that more aggressive goals ultimately will be established.
Stormwater
Municipal storm and surface water utilities throughout the region are working to comply with new
requirements evolving from the listing of the Puget Sound Chinook salmon and other species as
threatened under the Endangered Species Act (ESA). At the same time, they also are facing the
implementation of new Phase II National Pollution Discharge Elimination System (NPDES) permit
requirements. Approximately 100 small to medium jurisdictions including Mercer Island fall under the
requirements of the permit.
NPDES is an ongoing program to protect and improve surface water quality. NPDES requires cities to
implement six "minimum control measures," including public education and involvement about the
impacts of stormwater, detection and elimination of polluting discharges, post-construction management
of stormwater in redevelopment and new development, and "good housekeeping" efforts for municipal
operations. NPDES is implemented through permits for 5 year terms with specific requirements for
compliance. For example, the City updated its storm water regulations in late 2009 to comply with the
permit.
The Lake Washington/Cedar/Sammamish Watershed Chinook Salmon Conservation Plan was
completed in 2005. The plan is based on best available science, provides a long-term strategy for
bringing salmon off the list of threatened species, and is based on adaptive management principles. This
planning effort was funded by jurisdictions throughout Water Resource Inventory Area (WRIA) 8, which
is the state-designated planning area that encompasses parts of King and Snohomish counties along with
Mercer Island and 23 other cities. During the 2007-2008 biennium, implementation of the plan hit full
stride and will continue in the new biennium.
_________________________________
City of Mercer Island 2011-2012 Budget F-5
Utility Funds Summary
The City’s first ever Comprehensive Basin Review was completed in 2006. It identifies and prioritizes
capital projects for years to come. The CIP section is updated in even numbered years to support the
development of the capital program in the budget. The Basin Review is the City’s “road map” for the
utility to ensure continued reliable operation while addressing ongoing erosion problems in ravines,
replacing or rehabilitating aging pipes, and protecting water quality in Lake Washington.
Since 1999, King County has provided the City with technical assistance to evaluate water quality
conditions in several sub-basins on the Island. This effort involves sampling and analysis of stormwater
in these basins. In general, the results indicate that pollutants found in the samples are typical of built-
out urban cities, and capital improvements focused on erosion in watercourses correlate to an
improvement to water quality.
Water
The Cascade Water Alliance (Cascade) formed in 1998 with Mercer Island becoming its second member
to join. Cascade’s formation followed years of work by elected officials in the greater King County
region to develop independent water supplies for suburban cities and water districts. Seattle initially
supported the formation of a “new entity” to provide water supply outside its city limits. In 1999, a
water supply contract negotiated by Seattle and the group that became Cascade failed to gain enough
support (75% of Seattle’s 27 wholesale purveyors) to be accepted by Seattle. Today, Seattle’s policy is
that they will continue to own, operate, and control the Seattle water supply system. They offered new
wholesale contracts to individual or groups of water utilities for either full or partial water supply
requirements.
In late 2002, Cascade adopted a new interlocal agreement for its members that heightened the potential
for near-term water shortages and large capital expenditures for development of new supply. In January
2003, the Utility Board and City staff recommended that Mercer Island withdraw from the Cascade
Water Alliance on the belief that Seattle’s water system is a more certain supply for the City of Mercer
Island’s low-growth needs at lower long-term cost increases for our utility customers.
The City Council agreed and in June 2003 approved a new supply contract with the City of Seattle.
Eleven wholesale water customers including Mercer Island, who had 30-year contracts, now have new
60-year water service agreements with Seattle. Mercer Island has a seat on the Seattle Public Utilities
Operating Board that oversees the new wholesale contract.
For water utilities throughout the region, the growing pressure on limited storage capacity has meant a
continuing focus on conservation. Mercer Island's “Be Responsible” conservation campaign kicked off in
2001, and will continue in the coming biennium. “Be Responsible” is designed to complement the
Seattle Public Utilities' conservation programs, which are more regional in nature, by targeting
residential usage during the summer when consumption is at its peak. A conservation surcharge on the
summer water bills of Island customers is funding “Be Responsible”. In general, with behavior changes
and the installation of lower flow toilets and appliances, Mercer Island’s overall water use has declined.
In 2004, the City completed the Utility Vulnerability Assessment and Emergency Response Plan required
by the Bioterrorism Preparedness and Response Act of 2002. This work highlighted the importance of
creating more drinking water storage on the Island. In 2005, the City Council, Utility Board, and staff
agreed that a small well would be the most cost-effective and reliable way to provide an emergency
supply of drinking water for Island residents. Feasibility work for the well was completed in 2005, and
design work was completed in 2006. Early in 2007, a test well was drilled to a depth of 570 feet,
producing water of both the quality and quantity to serve as a short-term source in the event of an
interruption in the Island’s supply from Seattle Public Utilities. During testing, the test well produced
_________________________________
F-6 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
300 gallons per minute (gpm) for 24 hours, enough to provide about 5 gallons per person on a daily
basis for up to seven days. In 2007-2008, a Temporary Use Plan for the test well and conceptual
designs of the permanent well facility were developed. Feasibility, Test Well Construction, Temporary
Use Planning, and Conceptual Design were completed at a cost of $525,000. In April 2008, Council
reviewed the well project and directed staff to move forward with the design of the permanent well
facility, allocating $135,000 for final design. The City Council reviewed the design of the permanent well
and authorized staff to bid the project on December 1, 2008. The City awarded the construction
contract on June 15, 2009 for $812,000 to Equity Builders, LLC. Construction was complete, and the
project close-out accepted by Council on July 19, 2010. Construction and a portion of the design costs
for the well were funded with a short-term loan for $1,015,000, with repayment to come from the
anticipated sale of the First Hill property. In June 2010, the bond terms were amended, extending the
terms of the loan to June 2013, with a true interest cost of 2.72%. In addition, $40,000 was paid on the
principal balance using project savings from construction of the well, thereby reducing the principal
balance to $975,000. The proceeds from the future sale of the First Hill property will be used to pay
this principal balance.
In July 2008, the updated Comprehensive Water System Plan was adopted by the City Council. State
law requires an update at least every six years. The plan looks at future demands on the system and
how storage and other system requirements may change. Compliance with future water quality
regulations and capital requirements also are examined. The plan was used as a guide for capital budget
planning during the development of the 2011-2012 biennial budget.
In April of 2009 the Washington State Department of Health (DOH) performed a sanitary survey of the
City’s water system. DOH Group A drinking water regulation, WAC 246-290-416, requires routine
sanitary surveys of all Group A systems once every five years. The purpose of the survey was to assess
the overall operation, maintenance and management of the water system towards ensuring the
distribution of safe and reliable drinking water. The last survey was performed in April of 2004. DOH
reported to the City of Mercer Island that their water system appears to be in great condition; a result
of a functional operations and maintenance program that continues to evolve based on education and
experiences. The survey also noted that the City’s facilities appeared to be well maintained.
Operation and Maintenance of the Utilities
Water is delivered to the head works by Seattle Public Utilities' 16” and 24” water supply lines. The
water is stored in two 4-million gallon reservoirs for domestic use and fire protection. On average,
about 800 million gallons of water are purchased annually. A majority of water used is distributed
through 122 miles of 4” to 30” waterlines and is delivered to customers through approximately 7,300
water meters. To control high water pressure in the lower elevations in the system, 87 pressure
reducing stations (PRV's) are necessary. There are approximately 1,800 in-line valves installed for
control and isolation purposes. There are also 1,120 fire hydrants in the system.
Sewer collection and transmission services are provided to 7,200 single-family residences, 1,300 multi-
family units, and 155 businesses and schools connected to the sanitary sewer collection system. Sewage
is pumped through 102.7 miles of pipe and through 17 sewage pump stations to the two King County
Wastewater pumping stations (located at the North end and on the Southeast side of the Island) which
then pump the sewage over to the King County Wastewater Treatment Facility in Renton . The City’s
goal is to perform all work in accordance with City, State, and Federal rules and regulations, including
the City's Sewer Comprehensive Plan and the Growth Management Act.
_________________________________
City of Mercer Island 2011-2012 Budget F-7
Utility Funds Summary
The City’s Storm Water system is made up of close to 7,600 catch basins, 132 miles of storm lines, 18.8
miles of water courses, and 28.1 miles of ditches. The City’s goal is to comply with State and Federal
regulations affecting storm water quality by performing maintenance using our established standards.
Operations and Maintenance (O&M) programs are necessary to protect property from flooding and to
prevent pollutants and sediments that have been captured by storm water facilities from being washed
into the lake during storm events. The Storm Water Utility relies heavily on contracted services to
perform many of these operations.
The budget for the Operation and Maintenance of the City’s three Utilities is discussed in detail in
Section G (Operating Budget by Department) of the Budget (see Maintenance Department).
Capital Reinvestment in the Utilities
Capital Reinvestment in the three City Utilities is guided by the City’s Comprehensive Water System
Plan, General Sewer Plan, and Comprehensive Basin Review. Due to the impact of capital costs on rates
and the variation in funding levels needed over time, each utility establishes and maintains a capital
projects schedule of at least six years in duration. The schedule includes project description, scheduled
year of construction, and total estimated cost. Each project is identified as an improvement project or a
replacement project (including repair and rehabilitation). Details of the capital replacement projects
proposed for each utility for the 2011-2012 biennium are included in Section H (Capital Improvement
Program) of the Budget.
Historical Utility Rate Increases
Rate increases have varied significantly over time. For several of the City’s utilities, there have been
several years when no rate increase was taken. For example, there was no increase in Sewer rates for
the 10 year period from 1994 to 2003. A summary of the 20 year rate history for the City’s Water and
Sewer utilities are presented in the tables below:
Water Rate History Sewer Rate History
Year Incr/Decr Year Incr/Decr Year Incr/Decr Year Incr/Decr
2010 8.40% 2000 5.30% 2010 9.75% 2000 0.00%
2009 9.50% 1999 9.50% 2009 8.00% 1999 0.00%
2008 8.30% 1998 6.70% 2008 18.10% 1998 0.00%
2007 9.15% 1997 0.00% 2007 12.00% 1997 0.00%
2006 6.50% 1996 0.00% 2006 9.00% 1996 0.00%
2005 2.35% 1995 0.00% 2005 9.00% 1995 0.00%
2004 3.50% 1994 0.00% 2004 9.40% 1994 0.00%
2003 10.00% 1993 0.85% 2003 0.00% 1993 49.20%
2002 2.50% 1992 0.00% 2002 0.00% 1992 3.25%
2001 0.25% 1991 0.00% 2001 0.00% 1991 0.00%
10 Yr Avg 6.05% 20 Yr Avg 4.14% 10 Yr Avg 7.53% 20 Yr Avg 6.39%
_________________________________
F-8 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
The Stormwater Utility was formed late in 1995. A summary of the 15 year rate history for the City’s
Stormwater utility is presented in the following table:
Stormwater Rate History
Year Incr/Decr Year Incr/Decr
2010 5.50% 2000 7.25%
2009 5.50% 1999 2.40%
2008 0.00% 1998 14.00%
2007 5.70% 1997 40.00%
2006 5.10% 1996 15.50%
2005 5.40% 1995 N/A
2004 0.00% 1994 N/A
2003 0.00% 1993 N/A
2002 0.00% 1992 N/A
2001 0.00% 1991 N/A
10 Yr Avg 2.72% 15 Yr Avg 7.09%
Utility Funding and Rate Setting
In 1993, the Utility Board and City staff worked closely to establish financial policies to guide future rate
and budget decisions. One of the guiding policies is “Each utility will establish rates sufficient on an annual
basis to meet all utility cash requirements including operating expenses, debt service, additions to reserves and
rate-funded capital costs.” The fiscal policies are detailed in Section C (Budget Policies) of the Budget (see
Utility Fiscal Policies).
The Utility Board reviews the proposed biennial budget for each of the City’s three utilities and makes
rate recommendations on an annual basis. During 2006 and again in 2009, an in-depth study of the
City’s Water Rates was conducted by Financial Consulting Solutions Group (FCSG) with review and key
decisions made by the Utility Board. The 2006 study included a review of the fiscal policies for the
Water Utility, an analysis of the revenue requirement and customer cost allocations of the Water
Utility, rate design incorporating cost of service adjustments, and a review of non-rate charges and
miscellaneous fees charged by the Water Utility. The 2009 study reviewed the overall water use
(consumption) on which rates are based, customer cost allocations, capital needs, and identified fire
protection costs to be recovered through a utility tax instead of rates.
The 2011-2012 biennial budget was developed based on the following rate increases:
Water – 9.5% average increase in 2011 and 2012 across all customer classes. This rate
increase is largely driven by the cost of purchased water and planned capital improvement
needs. Seattle Public Utilities sets rates in 3 year periods and has not yet forecast rates for
2012-2014, but anticipates a large increase (10%-20%) to wholesale water rates in 2012,
followed by more moderate increases of about 5% per year. The Utility Board recommends
increasing the annual capital funding level to $1.6 M during the 6 year planning period, as
recommended in the Water System Plan, to fund projected capital reinvestment projects for
mains and hydrants. Staff recommends using debt financing for the First Hill Water
_________________________________
City of Mercer Island 2011-2012 Budget F-9
Utility Funds Summary
Improvements ($1.2M) planned for 2012, in order to bring rates below the 12% and 15%
forecast for 2011 and 2012 under pay-as-you-go. The Utility Board unanimously recommends a
9.5% increase to Water Rates for 2011. For a single family residential customer the 2011 rate
increase translates into a $5.11 increase in the bi-monthly bill, assuming an average water usage
of 15 ccf per bi-monthly billing period and a ¾” meter.
Sanitary Sewer – 9.3% increase in 2011 and 2012. This covers the City’s portion of operating
and maintaining the sanitary sewer system and equals about 50% of the total bi-monthly sewer
bill paid by the average single family residential customer. The other 50% is the Sewage
Treatment charge (discussed below). The rate increase is largely driven by the capital
reinvestment needs of the system, after being held to a minimum during construction of the
Sewer Lake Line replacement project. After an initial review of rates, staff recommended
reducing capital reinvestment planned for 2014 in order to bring rates below the 9.75%
originally forecast for 2011 and to better balance the project workload on staff. The Utility
Board unanimously recommends a 9.3% increase for 2011. This represents a $5.83 increase to
the average single family residential customer’s bi-monthly sewer bill, with a winter water use of
15 ccf per bi-monthly period.
Sewage Treatment – Sewage Treatment rates charged by King County Wastewater
Treatment, which represents a “pass through” charge, will increase in 2011 by 13.2%, which
represents an $8.40 increase in the bi-monthly bill for an average single family residential
customer.
Storm Water – 3.3% increase in 2011 and 2012. This translates into a 96 cent increase in the
2011 bi-monthly bill of a single family residential customer.
Emergency Medical Service (EMS) – Emergency Medical Service rates are adjusted annually
for inflation based on the Seattle metro area’s CPI-W. A rate increase of 0.85% is
recommended for 2011, which corresponds to the First Half 2010 CPI-W. For 2011, rates will
be adjusted for the actual costs of the four firefighter positions supported by this rate and rates
for customer class will be reviewed based on EMS call history. Finally, the demand portion of
the rate was adjusted based on revenue expected to be collected from ambulance transport
fees. As a result, a flat rate of $6.78 per ESU was adopted for 2011. The average single family
residential customer’s bi-monthly bill will increase by $3.18 to $6.78 per bi-monthly bill.
Taken together, the total (i.e. water, sewer, storm water, and EMS) bi-monthly utility bill for the average
single family residential customer will go up by 11.0% in 2011 and 5.5% in 2012, which equates to a
$23.48 increase and a $13.07 increase respectively, as noted in the table below.
Description 2010 2011 2012
Bi-Monthly Bill $213.42 $236.90 $249.97
Rate Increase over Prior Year 5.8% 11.0% 5.5%
Dollar Increase over Prior Year $11.66 $23.48 $13.07
_________________________________
F-10 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
Comparison of Mercer Island to King County City Average*
In order to provide some context for the rate history and proposed increases for the City of Mercer
Island, a comparison of 2010 water, sewer, and stormwater utility rates between Mercer Island and the
King County City average is presented in the table below.
Description Water Sewer Storm Total
Mercer Island $53.84 $63.22 $28.96 $146.02
King County average $69.21 $53.15 $21.76 $144.12
* Based on data from the 2010 AWC (Association of Washington Cities) Tax and User Fee Survey.
It should be noted that the sewer utility rate for Mercer Island and the King County City average
reflects sanitary sewer costs only. The King County sewage treatment pass through charge is excluded.
Income statements for the Water Fund, Sewer Fund, and Storm Water Fund are presented on the
following three pages.
_________________________________
City of Mercer Island 2011-2012 Budget F-11
Utility Funds Summary
Water Fund Income Statement
2009 2010 2011 2012
Description Actual Estimate Budget Budget
Revenues:
Sales/Service $ 4,076,013 $ 3,773,745 $ 4,315,004 $ 4,735,428
Conservation Surcharge 45,387 25,000 30,000 30,000
Cell Tower Lease / Utility Tax 26,177 64,620 75,089 82,271
Meter Installations 62,517 80,000 90,000 100,000
Total Revenues $ 4,210,094 $3,943,365 $ 4,510,093 $4,947,699
Operating Expenses:
Salaries and Benefits $ 823,409 $ 885,341 $ 923,098 $ 968,520
Supplies 141,800 180,300 197,600 207,600
SPU Purchased Water 1,617,528 1,544,927 1,614,113 1,856,230
Contractual Services 226,019 192,690 140,620 137,520
Equipment Rental 115,819 114,341 124,134 124,134
Other Services and Charges 93,258 110,330 118,281 119,723
Insurance 53,200 58,400 78,674 83,926
Taxes 207,241 197,325 216,883 238,228
City Administration 250,000 265,000 176,425 184,043
Total Operating Expenses $ 3,528,273 $3,548,654 $ 3,589,828 $3,919,924
Net Income $ 681,821 $ 394,711 $ 920,265 $1,027,775
Other Financial Sources (Uses) :
Connection Charges $ 181,148 $ 92,160 $ 102,400 $ 112,640
Interest 16,691 6,200 7,612 6,432
Debt Proceeds - Well, First Hill 1,015,000 - - 1,200,000
Debt Service (10,359) (69,264) (26,520) (118,845)
Capital Projects (1,314,183) (967,846) (1,235,299) (1,587,940)
Total Sources (Uses) $ (111,703) $ (938,750) $(1,151,807) $ (387,713)
Net Increase (Decrease) in
Working Capital $ 570,118 $ (544,039) $ (231,542) $ 640,062
Working Capital:
Beginning Working Capital $ 1,496,358 $ 2,066,476 $ 1,522,437 $ 1,290,895
Net Increase (Decrease) 570,118 (544,039) (231,542) 640,062
Ending Working Capital $ 2,066,476 $1,522,437 $ 1,290,895 $1,930,957
Less: Fiscal Policy Reserves $ (723,296) $ (735,391) $ (877,222) $ (948,325)
Less: Capital Funding Reserve (250,000) (281,341) (293,567) (309,422)
Working Capital Available $ 1,093,180 $ 505,705 $ 120,106 $ 673,210
_________________________________
F-12 City of Mercer Island 2011-2012 Budget
Utility Funds Summary
Sewer Fund Income Statement
2009 2010 2011 2012
Description Actual Estimate Budget Budget
Revenues:
Sales/Service $ 2,520,776 $ 2,766,500 $ 3,038,270 $ 3,336,422
Charges for KC Treatment 3,365,840 3,315,000 3,771,345 3,790,200
Total Revenues $ 5,886,616 $ 6,081,500 $ 6,809,615 $ 7,126,622
Operating Expenses:
Salaries and Benefits $ 659,096 $ 693,037 $ 739,075 $ 775,291
Supplies 50,297 48,600 57,100 57,100
Contractual Services 225,012 270,390 335,820 303,320
KC Sewage Treatment Charges 3,305,490 3,315,000 3,771,345 3,790,200
Equipment Rental 67,108 69,158 68,104 68,104
Other Services and Charges 92,482 100,880 97,388 108,106
Insurance 53,200 58,400 96,859 104,123
Taxes 97,098 98,000 99,900 100,400
City Administration 250,000 265,000 176,425 184,043
Total Operating Expenses $ 4,799,783 $ 4,918,465 $ 5,442,016 $ 5,490,687
Net Income $ 1,086,833 $ 1,163,035 $ 1,367,599 $ 1,635,935
Other Financial Sources (Uses) :
Interest Earnings $ 108,795 $ 26,031 $ 11,825 $ 7,841
Connection Charges 2,930 10,000 3,600 3,600
Federal STAG Grant 227,929 249,071 - -
Debt Proceeds - Sewer Lk Line 16,016,973 350,000 - -
Debt Service - Sewer Lk Line (195,914) (1,104,383) (1,130,173) (1,130,583)
Sewer Lake Line Project (12,698,320) (11,522,679) - -
Other Capital Projects (376,188) (806,918) (647,841) (809,979)
Total Sources (Uses) $ 3,086,205 $(12,798,878) $ (1,762,589) $ (1,929,121)
Net Increase (Decrease) in
Working Capital $ 4,173,037 $(11,635,843) $ (394,990) $ (293,186)
Working Capital:
Beginning Working Capital $ 8,645,343 $ 12,818,380 $ 1,182,536 $ 787,546
Net Increase (Decrease) 4,173,037 (11,635,843) (394,990) (293,186)
Ending Working Capital $ 12,818,380 $ 1,182,537 $ 787,546 $ 494,360
Less: Fiscal Policy Reserves $ (393,582) $ (403,314) $ (446,512) $ (450,528)
Less: Reserve for Lake Line (11,522,679) - - -
Working Capital Available $ 902,119 $ 779,223 $ 341,034 $ 43,832
_________________________________
City of Mercer Island 2011-2012 Budget F-13
Utility Funds Summary
Storm Water Fund Income Statement
2009 2010 2011 2012
Description Actual Estimate Budget Budget
Revenues:
Sales/Service $ 1,538,228 $ 1,622,831 $ 1,676,384 $ 1,731,705
Grants - FEMA, NPDES 94,209 50,000 65,134 65,134
Total Revenues $ 1,632,437 $ 1,672,831 $ 1,741,518 $ 1,796,839
Operating Expenses:
Salaries and Benefits $ 433,143 $ 454,870 $ 444,808 $ 467,855
Supplies 53,018 22,200 21,900 21,900
Contractual Services 224,125 391,420 302,204 304,604
Other Services and Charges 30,552 35,750 27,784 28,264
Equipment Rental 59,623 61,992 68,414 68,414
Insurance 50,000 55,000 48,074 51,889
Utilities 20,365 28,600 28,000 28,000
Intergovernmental 10,715 11,730 12,630 13,630
City Administration 55,600 59,000 39,279 40,976
Total Operating Expenses $ 937,140 $ 1,120,562 $ 993,093 $ 1,025,532
Net Income $ 695,297 $ 552,269 $ 748,425 $ 771,307
Other Financial Sources (Uses) :
Fee-in-Lieu $ 38,573 $ 115,000 $ 35,000 $ 35,000
Interest 20,068 7,500 8,800 6,600
Grant - LID Project - - - 225,000
Capital Projects (840,251) (474,997) (1,365,188) (1,392,490)
Total Sources (Uses) $ (781,610) $ (352,497) $ (1,321,388) $ (1,125,890)
Net Increase (Decrease) in
Working Capital $ (86,313) $ 199,773 $ (572,963) $ (354,583)
Working Capital:
Beginning Working Capital $ 1,867,416 $ 1,781,103 $ 1,980,876 $ 1,407,912
Net Increase (Decrease) (86,313) 199,773 (572,963) (354,583)
Ending Working Capital $ 1,781,103 $ 1,980,876 $ 1,407,912 $ 1,053,329
Less: Fiscal Policy Reserves $ (81,163) $ (81,661) $ (77,450) $ (80,167)
Working Capital Available $ 1,699,940 $ 1,899,215 $ 1,330,462 $ 973,162
_________________________________
F-14 City of Mercer Island 2011-2012 Budget
Section G. Operating Budget by Department
Table of Contents
City Attorney’s Office .................................................................... G-1
City Council ...................................................................................... G-9
City Manager’s Office...................................................................... G-17
Development Services Group ....................................................... G-27
Finance Department ........................................................................ G-43
Fire Department .............................................................................. G-55
Human Resources Department .................................................... G-69
Maintenance Department............................................................... G-79
Municipal Court ............................................................................... G-103
Parks & Recreation Department .................................................. G-111
Police Department........................................................................... G-129
Youth & Family Services Department ......................................... G-151
Non-Departmental .......................................................................... G-165
CITY ATTORNEY’S OFFICE
_________________________________
G-2 City of Mercer Island 2011-2012 Budget
Department:
City Attorney’s Office
Description
The City Attorney’s Office is primarily responsible for the following functions: 1) legal advice and
defense; and 2) prosecution and criminal management.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Forecast Budget Budget 10-11 11-12
Regular (Ongoing):
Prosecution & Criminal Mgt 0.80 0.80 1.00 1.00 25.0% 0.0%
Legal Advice & Defense 2.20 2.20 2.00 2.00 -9.1% 0.0%
Total Regular 3.00 3.00 3.00 3.00 0.0% 0.0%
Contracted (Temporary):
Prosecution & Criminal Mgt - - - - N/A N/A
Legal Advice & Defense - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-3
Department:
City Attorney’s Office
2011-2012 Resources
General Purpose Revenue
Support
100%
2011-2012 Uses
Salaries & Wages
64%
Benefits
18%
Contract Services
12%
Other Fleet & Computer
4% Charges
2%
_________________________________
G-4 City of Mercer Island 2011-2012 Budget
Department:
City Attorney’s Office
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Forecast Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
General Purpose Revenue 471,585 517,222 480,977 495,209 -7.0% 3.0%
Total Resources 471,585 517,222 480,977 495,209 -7.0% 3.0%
Uses:
Salaries & Wages 287,958 336,447 309,895 313,990 -7.9% 1.3%
Benefits 80,945 91,219 82,852 92,989 -9.2% 12.2%
Supplies 942 1,800 1,200 1,200 -33.3% 0.0%
Contractual Services 75,898 59,100 59,000 59,000 -0.2% 0.0%
Communications 905 2,500 750 750 -70.0% 0.0%
Fleet/Computer/Equip Rental 7,506 7,506 10,330 10,330 37.6% 0.0%
Other Services & Charges 17,430 18,650 16,950 16,950 -9.1% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total Uses 471,585 517,222 480,977 495,209 -7.0% 3.0%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Forecast Budget Budget 10-11 11-12
Legal Advice & Defense 372,116 394,948 341,308 351,528 -13.6% 3.0%
Prosecution & Criminal Mgt 99,469 122,274 139,669 143,681 14.2% 2.9%
Total 471,585 517,222 480,977 495,209 -7.0% 3.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-5
Department:
City Attorney’s Office
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 517,222
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (34,919)
Backfill for Paralegal (2,100)
Dues & subscriptions (800)
Other operating costs (426)
Public defender costs 2,000
Subtotal (36,245) -7.0%
2011 Base Budget 480,977 -7.0%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None
Subtotal -
2011 Final Budget 480,977 -7.0%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 480,977
Plus 2012 General Inflationary Increases 14,232 3.0%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 495,209 3.0%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 495,209 3.0%
_________________________________
G-6 City of Mercer Island 2011-2012 Budget
Department Function:
Prosecution & Criminal Management
Description
Prosecute all criminal citations (e.g. driving while under the influence, domestic violence, assaults, and
thefts) and traffic infractions (e.g. speeding and parking violations) issued by Mercer Island Police
Department and handle appeals of Municipal Court decisions (RALJ hearings) to King County Superior
Court.
Priority of Government
#1 The community will be safe.
Services & Products
• Exercise prosecutorial discretion in making filing determinations.
• Train Mercer Island police officers on probable cause statements, writing reports, and witness
preparation.
• Meet with Mercer Island Municipal Court staff to insure expeditious adjudication of all court
matters.
• Prepare and respond to legal discovery requests.
• Work with public defender and other defense counsel on case resolution.
2011-2012 Key Initiatives
• Research and update City’s municipal criminal code.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Forecast Budget Budget 10-11 11-12
Salaries & Wages 33,815 69,125 82,228 83,338 19.0% 1.3%
Benefits 13,089 20,799 24,191 27,093 16.3% 12.0%
Supplies - - - - N/A N/A
Contractual Services 45,999 25,000 27,000 27,000 8.0% 0.0%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges 6,567 7,350 6,250 6,250 -15.0% 0.0%
Intergovernmental Services - - - - N/A N/A
Total 99,469 122,274 139,669 143,681 14.2% 2.9%
_________________________________
City of Mercer Island 2011-2012 Budget G-7
Department Function:
Legal Advice & Defense
Description
Provide legal representation and counsel to the City Manager, City Council, City departments, and
Council-appointed boards and commissions.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Represent the City in civil litigation and administrative hearings in the areas of tort defense, land use,
personnel and labor, contract, and municipal law.
• Prepare City ordinances, contracts, and legal documents.
• Handle special projects as assigned by the City Manager, including legislative monitoring and
advocacy for City interests.
• Control and monitor litigation including the City's insurance pool, Washington Cities Insurance
Authority.
• Represent the City in intergovernmental disputes.
• Assist City Clerk in responding to Public Records Act requests.
2011-2012 Key Initiatives
• Research and update City’s Land Use regulations.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Forecast Budget Budget 10-11 11-12
Salaries & Wages 254,144 267,322 227,667 230,652 -14.8% 1.3%
Benefits 67,855 70,420 58,661 65,896 -16.7% 12.3%
Supplies 942 1,800 1,200 1,200 -33.3% 0.0%
Contractual Services 29,900 34,100 32,000 32,000 -6.2% 0.0%
Communications 905 2,500 750 750 -70.0% 0.0%
Fleet/Computer/Equipment Rental 7,506 7,506 10,330 10,330 37.6% 0.0%
Other Services & Charges 10,864 11,300 10,700 10,700 -5.3% 0.0%
Intergovernmental Services - - - - N/A N/A
Total 372,116 394,948 341,308 351,528 -13.6% 3.0%
_________________________________
G-8 City of Mercer Island 2011-2012 Budget
CITY COUNCIL
_________________________________
G-10 City of Mercer Island 2011-2012 Budget
Department:
City Council
Description
The City Council is comprised of seven members who are elected on a non-partisan, "at-large" basis to
four-year terms by majority votes of the Mercer Island citizenry. The City Council serves as the
legislative branch of Mercer Island City government, establishing all City policies and passing all
ordinances and resolutions. From its members, the City Council elects a Mayor and a Deputy Mayor to
preside over City Council meetings and establish a focal point for conducting the Council's business.
The Mayor, Deputy Mayor, and the other five Council members serve on a part-time basis. Council
Meetings are scheduled the first and third Monday of the each month. Council members serve as
liaisons between the City Council and City advisory boards and commissions, communicating
information, policies, and work priorities between the bodies. In addition, Council members represent
Mercer Island interests in various regional and state forums.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Legislative Oversight - - - - N/A N/A
Sister City Program - - - - N/A N/A
Total Regular - - - - N/A N/A
Contracted (Temporary):
Legislative Oversight - - - - N/A N/A
Sister City Program - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-11
Department:
City Council
2011-2012 Resources
General Purpose Revenue
100%
2011-2012 Uses
Other
19%
Salaries & Wages
53%
Supplies
24%
Benefits
4%
_________________________________
G-12 City of Mercer Island 2011-2012 Budget
Department:
City Council
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - 35,000 - - -100.0% N/A
General Purpose Revenue 49,414 57,165 36,265 36,265 -36.6% 0.0%
Total Resources 49,414 92,165 36,265 36,265 -60.7% 0.0%
Uses:
Salaries & Wages 17,600 19,200 19,200 19,200 0.0% 0.0%
Benefits 1,434 1,565 1,565 1,565 0.0% 0.0%
Supplies 9,089 10,500 8,500 8,500 -19.0% 0.0%
Contractual Services 9,973 47,000 - - -100.0% N/A
Other Services & Charges 11,318 13,900 7,000 7,000 -49.6% 0.0%
Total Uses 49,414 92,165 36,265 36,265 -60.7% 0.0%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Legislative Oversight 47,976 87,265 34,765 34,765 -60.2% 0.0%
Sister City Program 1,438 4,900 1,500 1,500 -69.4% 0.0%
Total 49,414 92,165 36,265 36,265 -60.7% 0.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-13
Department:
City Council
2011-2012 Budget Analysis
General & Capital Reserve Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 92,165
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- I-90 Lobbyist (35,000)
Contract services (Council retreat) (12,000)
Sister City travel & supplies (3,400)
Travel, tuition & registrations (2,750)
Other operating costs (2,750)
Subtotal (55,900) -60.7%
2011 Base Budget 36,265 -60.7%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None
Subtotal -
2011 Final Budget 36,265 -60.7%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 36,265
Plus 2012 General Inflationary Increases - 0.0%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 36,265 0.0%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 36,265 0.0%
_________________________________
G-14 City of Mercer Island 2011-2012 Budget
Department Function:
Legislative Oversight
Description
Identify Council priorities, provide policy direction, and approve funding during the biennial budget
process and at regular and special Council meetings for current services; ongoing and temporary staffing;
new programs; one-time studies, contractual services, and equipment costs; reserves; and capital
improvement projects.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Attend advisory board and commission meetings.
• Report on Council actions, policies, and work priorities.
• Convey work products and priorities between City Council and boards and commissions.
• Assist in recruitment and appointment of advisory board members and commissioners.
• Accessibility through council meetings, letters, phone, and personal contact.
• Explain City policy and practices to citizens and media.
• Connect citizens to City staff to address concerns and needs effectively.
• Participate in the Eastside Transportation Program as it relates to local and Eastside transit needs.
• Participate and be active in state matters through the Association of Washington Cities.
• Participate in and monitor activities of the Metropolitan King County/Regional Committees.
• Continue semi-annual joint meetings of the School Board and City Council.
2011-2012 Key Initiatives
• Conduct at least one annual planning session to establish work plan and priorities.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 17,600 19,200 19,200 19,200 0.0% 0.0%
Benefits 1,434 1,565 1,565 1,565 0.0% 0.0%
Supplies 8,011 8,000 7,000 7,000 -12.5% 0.0%
Contractual Services 9,973 47,000 - - -100.0% N/A
Other Services & Charges 10,958 11,500 7,000 7,000 -39.1% 0.0%
Total 47,976 87,265 34,765 34,765 -60.2% 0.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-15
Department Function:
Sister City Program
Description
A non-profit community based organization promoting educational, cultural and other exchanges
between Thonon les Bains, France and the City of Mercer Island, Washington. It is an association of
individuals and organizations interested in promoting close ties between both cities. The association’s
mission is “to create opportunities for citizens and organizations of Mercer Island to experience and
explore other cultures through long-term friendships and partnerships.”
Priority of Government
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Inform and educate the public about our sister city Thonon les Bains.
• Advance educational, cultural, and other relationships between Mercer Island and Thonon les Bains.
2011-2012 Key Initiatives
• Support communications with and possible exchanges between Mercer Island and Thonon les Bains.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Supplies 1,078 2,500 1,500 1,500 -40.0% 0.0%
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Other Services & Charges 360 2,400 - - -100.0% N/A
Intergovernmental Services - - - - N/A N/A
Total 1,438 4,900 1,500 1,500 -69.4% 0.0%
_________________________________
G-16 City of Mercer Island 2011-2012 Budget
CITY MANAGER’S OFFICE
_________________________________
G-18 City of Mercer Island 2011-2012 Budget
Department:
City Manager’s Office
Description
Appointed by the City Council, the City Manager serves as the chief executive officer of the City. The
City Manager is primarily responsible for the preparation of the City's biennial budget, the enforcement
and implementation of all laws and policies, and the efficient and effective delivery of all City services.
Directing the allocation and organization of the City's resources, the City Manager's Office oversees the
development and implementation of all policy and program initiatives, including the City Council's top
legislative priorities. The City Manager’s Office also includes the City Clerk and Public Communications
functions.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Admin & Intergovt'l Relations 2.00 2.00 2.00 2.00 0.0% 0.0%
City Clerk 1.00 1.00 1.00 1.00 0.0% 0.0%
Public Communications 1.00 1.00 0.60 0.60 -40.0% 0.0%
Total Regular 4.00 4.00 3.60 3.60 -10.0% 0.0%
Contracted (Temporary):
Admin & Intergovt'l Relations - - - - N/A N/A
City Clerk - - - - N/A N/A
Public Communications - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-19
Department:
City Manager’s Office
2011-2012 Resources
General Purpose Revenue
100%
2011-2010 Uses
Equip Rental
Communications 1% Other Services
1% 11%
Contract Services
3%
Supplies
2%
Benefits
17%
Salaries
65%
_________________________________
G-20 City of Mercer Island 2011-2012 Budget
Department:
City Manager’s Office
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
General Purpose Revenue 776,534 787,048 698,136 727,962 -11.3% 4.3%
Total Resources 776,534 787,048 698,136 727,962 -11.3% 4.3%
Uses:
Salaries & Wages 428,390 498,898 462,765 469,280 -7.2% 1.4%
Benefits 113,387 130,528 114,205 128,516 -12.5% 12.5%
Supplies 4,656 25,000 13,500 13,500 -46.0% 0.0%
Contractual Services 80,524 20,700 18,000 18,000 -13.0% 0.0%
Communications 6,409 8,750 5,000 5,000 -42.9% 0.0%
Fleet/Computer/Equip Rental 15,322 15,322 10,616 10,616 -30.7% 0.0%
Other Services & Charges 127,845 87,850 74,050 83,050 -15.7% 12.2%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total Uses 776,534 787,048 698,136 727,962 -11.3% 4.3%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Admin & Intergovt'l Relations 433,340 438,669 422,749 441,429 -3.6% 4.4%
City Clerk 215,066 177,219 172,632 180,830 -2.6% 4.7%
Public Communications 128,128 171,160 102,756 105,704 -40.0% 2.9%
Total 776,534 787,048 698,136 727,962 -11.3% 4.3%
_________________________________
City of Mercer Island 2011-2012 Budget G-21
Department:
City Manager’s Office
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 787,048
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (12,437)
Supplies (11,500)
Professional services & special projects (10,000)
Travel, tuition & registrations (4,600)
Other operating savings (4,499)
Election expenses 4,000
Subtotal (39,036) -5.0%
2011 Base Budget 748,012 -5.0%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
Communications Coordinator (0.4 FTE reduction) (49,876)
Subtotal (49,876)
2011 Final Budget 698,136 -11.3%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 698,136
Plus 2012 General Inflationary Increases 24,826 3.6%
Plus (Less) 2012 Other Significant Changes:
Professional services & special projects 5,000
Subtotal 5,000 0.7%
2012 Base Budget 727,962 4.3%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 727,962 4.3%
_________________________________
G-22 City of Mercer Island 2011-2012 Budget
Department Function:
Administration & Intergovernmental Relations
Description
Implement City Council priorities, oversee management of all City departments, and provide
representation of Mercer Island interests in local, regional, and state forums.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Organize City resources to fulfill City Council's work program.
• Coordinate City Council business agenda with Mayor and Deputy Mayor.
• Represent the City in various regional and sub-regional activities (e.g. Eastside Transportation
Partnership, Eastside Public Safety Communication Agency, eCityGov Alliance, NORCOM, and
ARCH)
• Provide staffing resources to City Council.
2011-2012 Key Initiatives
• Complete City Council work program.
• Assist City Council with strategic initiatives regarding I-90, aquatics, fire station, Youth Theatre
Northwest, and joint facility use with the Mercer Island School District.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 260,235 326,845 328,290 332,465 0.4% 1.3%
Benefits 67,282 78,661 75,026 84,531 -4.6% 12.7%
Supplies 3,575 5,000 4,500 4,500 -10.0% 0.0%
Contractual Services 64,023 2,500 - - -100.0% N/A
Communications 3,108 2,750 2,500 2,500 -9.1% 0.0%
Fleet/Computer/Equipment Rental 9,663 9,663 5,433 5,433 -43.8% 0.0%
Other Services & Charges 25,454 13,250 7,000 12,000 -47.2% 71.4%
Total 433,340 438,669 422,749 441,429 -3.6% 4.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-23
Department Function:
City Clerk
Description
Fulfill the state legal requirements of the City Clerk position, support the City Council and City
Manager, and manage the City’s website.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Manage official City records including ordinances, resolutions, agreements, and minutes.
• Provide administrative support to the City Manager and City Council.
• Coordinate City Council meeting agenda packet creation and distribution.
• Process affidavits of publication regarding ordinances and notices.
• Serve as liaison to King County regarding elections.
• Collaborate with the Finance Department on the issuance of business licenses to amusement,
towing, and massage establishments.
• Manage the registration and training of public notaries.
• Maintain appointment records of City boards and commissions and coordinate the appointment
process.
• Provide training to employees regarding City Clerk and City Council policies and procedures.
• Track and coordinate the processing of public disclosure requests.
• Maintain the City's municipal code and coordinate any supplements thereto, including zoning codes.
• Maintain the City’s contracts and agreements database.
• Maintain and update the City's website and provide training to employees.
2011-2012 Key Initiatives
• Implement a city-wide automated agenda creation process.
• Continue development of the records management system for essential public records.
• Continue development and implementation of document management system.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 94,698 90,755 88,998 90,148 -1.9% 1.3%
Benefits 24,734 26,752 25,292 28,340 -5.5% 12.1%
Supplies 20 - - - N/A N/A
Fleet/Computer/Equipment Rental 2,812 2,812 2,592 2,592 -7.8% 0.0%
Other Services & Charges 92,802 56,900 55,750 59,750 -2.0% 7.2%
Total 215,066 177,219 172,632 180,830 -2.6% 4.7%
_________________________________
G-24 City of Mercer Island 2011-2012 Budget
Department Function:
Public Communications
Description
Plan, organize, and supervise the City's community outreach efforts, town hall meetings, and media
relations to encourage informed input from Mercer Island citizens.
Priority of Government
#6 The community will support open and informed public involvement processes within the structure
of representative, democratic decision making.
Services & Products
• Publish the Mercer Island Quarterly, an all-Island newsletter about City services and programs.
• Publish MI Weekly online news brief.
• Facilitate town hall and other city meetings.
• Coordinate the City's media relations to provide accurate, consistent, and useful information.
• Produce website content.
• Assist all departments in public involvement and education by providing communications strategy,
graphic design, and advertising support.
• Monitor current events and issues that may impact the City.
• Develop brochures, handouts, and web content for services and programs that involve multiple City
departments.
• Maintain effective relations with local and regional organizations.
2011-2012 Key Initiatives
• Continue communications outreach to the community through newsletters, media contacts, and
website postings.
• Develop further means of improving community access to City government and more opportunities
to participate in decision-making processes.
• Continue cable broadcasting of Council meetings.
• Plan and organize community workshops to provide education about specific City programs and
services.
_________________________________
City of Mercer Island 2011-2012 Budget G-25
Department Function:
Public Communications
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 73,458 81,298 45,477 46,667 -44.1% 2.6%
Benefits 21,371 25,115 13,887 15,645 -44.7% 12.7%
Supplies 1,062 20,000 9,000 9,000 -55.0% 0.0%
Contractual Services 16,501 18,200 18,000 18,000 -1.1% 0.0%
Communications 3,301 6,000 2,500 2,500 -58.3% 0.0%
Fleet/Computer/Equipment Rental 2,847 2,847 2,592 2,592 -9.0% 0.0%
Other Services & Charges 9,589 17,700 11,300 11,300 -36.2% 0.0%
Total 128,128 171,160 102,756 105,704 -40.0% 2.9%
_________________________________
G-26 City of Mercer Island 2011-2012 Budget
DEVELOPMENT
SERVICES GROUP
_________________________________
G-28 City of Mercer Island 2011-2012 Budget
Department:
Development Services Group
Description
The Development Services Group (DSG) is responsible for regulating all development activities on the
Island. DSG reviews all private development permits to ensure that the public infrastructure is
protected and, when necessary, enhanced. DSG is comprised of the following functions: 1)
administration & customer services, 2) building plan review & inspection services, 3) development
engineering, and 4) land use planning services.
_________________________________
City of Mercer Island 2011-2012 Budget G-29
Department:
Development Services Group
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration & Customer Svcs 6.50 6.50 6.50 6.50 0.0% 0.0%
Building Plan Rvw & Inspec Svcs 4.50 4.50 4.50 4.50 0.0% 0.0%
Development Engineering 3.75 3.75 2.75 2.75 -26.7% 0.0%
Land Use Planning Services 3.00 3.00 3.00 3.00 0.0% 0.0%
Total Regular 17.75 17.75 16.75 16.75 -5.6% 0.0%
Contracted (Temporary):
Administration & Customer Svcs - - - - N/A N/A
Building Plan Rvw & Inspec Svcs 1.00 1.00 1.00 1.00 0.0% 0.0%
Development Engineering - - - - N/A N/A
Land Use Planning Services 1.00 1.00 - - -100.0% N/A
Total Contracted 2.00 2.00 1.00 1.00 -50.0% 0.0%
_________________________________
G-30 City of Mercer Island 2011-2012 Budget
Department:
Development Services Group
2011-2012 Resources
Development Permit Fees
56%
Stormwater Rates
1%
Sewer Rates
1%
Water Rates
1%
Street Fund REET Land Use Fees
1% 6%
Other Charges for
Services
1%
2011-2012 Uses
Communications
Equipment Rental
1%
4%
Contractual Services
4%
Other Services & Charges
1%
Supplies
1%
Benefits
20%
Salaries & Wages
69%
_________________________________
City of Mercer Island 2011-2012 Budget G-31
Department:
Development Services Group
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance (GF) 194,814 370,398 - - -100.0% N/A
Business & Occupation Tax 2,472 - - - N/A N/A
Development Permit Fees 928,761 875,000 1,155,000 1,155,000 32.0% 0.0%
Land Use Fees 122,488 111,000 116,000 116,000 4.5% 0.0%
Other Charges for Services 27,812 13,000 23,000 23,000 76.9% 0.0%
State Shared Revenues 51,979 - - - N/A N/A
Real Estate Excise Taxes 57,189 66,365 24,973 26,126 -62.4% 4.6%
Water Rates 25,758 29,142 24,975 26,128 -14.3% 4.6%
Sewer Rates 22,784 29,142 24,975 26,128 -14.3% 4.6%
Stormwater 22,784 29,142 24,973 26,126 -14.3% 4.6%
General Purpose Revenue 716,179 995,303 637,913 701,831 -35.9% 10.0%
Total Resources 2,173,021 2,518,492 2,031,810 2,100,340 -19.3% 3.4%
Uses:
Salaries & Wages 1,509,521 1,627,186 1,417,438 1,440,079 -12.9% 1.6%
Benefits 445,127 458,952 389,920 436,509 -15.0% 11.9%
Supplies 10,418 40,700 19,200 19,200 -52.8% 0.0%
Contractual Services 71,465 244,550 78,700 77,700 -67.8% -1.3%
Communications 8,913 9,150 9,430 9,430 3.1% 0.0%
Fleet/Computer/Equip Rental 99,829 99,829 89,147 89,147 -10.7% 0.0%
Other Services & Charges 14,750 38,125 27,975 28,275 -26.6% 1.1%
Capital 12,997 - - - N/A N/A
Total Uses 2,173,021 2,518,492 2,031,810 2,100,340 -19.3% 3.4%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration & Customer Svcs 646,779 695,009 681,707 703,470 -1.9% 3.2%
Building Plan Rvw & Inspec Svcs 661,401 730,654 681,715 706,493 -6.7% 3.6%
Development Engineering 461,965 603,802 352,790 365,563 -41.6% 3.6%
Land Use Planning Services 402,875 489,027 315,598 324,814 -35.5% 2.9%
Total 2,173,021 2,518,492 2,031,810 2,100,340 -19.3% 3.4%
_________________________________
G-32 City of Mercer Island 2011-2012 Budget
Department:
Development Services Group
2011-2012 Budget Analysis
General, Street & Beautification Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 2,431,066
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- Contract staff salaries & benefits (196,898)
- Comp plan update (80,000)
- Transportation plan (80,000)
- Building code update (18,500)
- Document scanning (carryover) (6,750)
- Bicycle/pedestrian study (carryover) (6,000)
Salary & benefit savings (relative to 2010 budget) (42,820)
Casual labor costs (20,000)
Other Contract services (11,100)
Travel, tuition & registrations (5,000)
Other operating costs (2,033)
Fire Marshal Contrac Services 18,000
Subtotal (451,101) -18.6%
2011 Base Budget 1,979,965 -18.6%
Plus 2011 Service Enhancement Requests:
Retain contract Building Plans Examiner (1.0 FTE) 99,819
Subtotal 99,819 4.1%
Less 2011 Service Reduction Proposals:
Transportation Manager (1.0 FTE reduction) (122,898)
Subtotal (122,898)
2011 Final Budget 1,956,886 -19.5%
_________________________________
City of Mercer Island 2011-2012 Budget G-33
Department:
Development Services Group
2011-2012 Budget Analysis
General, Street & Beautification Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 1,956,886
Plus 2012 General Inflationary Increases 65,071 3.3%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 2,021,957 3.3%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 2,021,957 3.3%
_________________________________
G-34 City of Mercer Island 2011-2012 Budget
Department:
Development Services Group
2011-2012 Budget Analysis
Water, Sewer & Storm Water Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 87,426
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- Casual labor (15,000)
Cellular phone & registration fees 1,185
Other operating costs 1,313
Subtotal (12,502) -14.3%
2011 Base Budget 74,924 -14.3%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None
Subtotal -
2011 Final Budget 74,924 -14.3%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 74,924
Plus 2012 General Inflationary Increases 3,459 4.6%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 78,383 4.6%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 78,383 4.6%
_________________________________
City of Mercer Island 2011-2012 Budget G-35
Department Function:
Administration & Customer Services
Description
Provide supervision to the department’s 4 teams. Serve as the primary point of contact for public
information related to development and as an advocate for customers interested or engaged in
development activity on the Island. Coordinate all facets of the permitting process, which encompass
permit intake, permit issuance, permit tracking, field inspections, and records management. Provide
liaison services for organizations, large projects, and community-wide issues.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Provide public information, tip sheets, guidelines, and applications for private building and land
development.
• Respond to all general information and permit application inquiries over the phone and over the
counter.
• Process all permits for building, land use, and design reviews.
• Schedule, attend, and coordinate all pre-application meetings for development permits.
• Maintain tracking system for permitting, inspections, code enforcement, land use planning, and
design review.
• Schedule all field inspections for building compliance with codes and approved plans.
• Maintain records for all plans, permits, historical street address files, and archive files for use by staff
and for public information requests.
• Provide staff support to the City Council, City Manager, Advisory Boards, and other departments.
• Provide code compliance oversight and direction.
2011-2012 Key Initiatives
• Conduct analysis of appropriate DSG costs and fees to assure that the City’s goal of full cost
recovery for all eligible permit activities is implemented.
• Develop clear administrative procedures for Code Enforcement.
_________________________________
G-36 City of Mercer Island 2011-2012 Budget
Department Function:
Administration & Customer Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 446,031 496,288 494,927 503,111 -0.3% 1.7%
Benefits 137,195 119,472 113,560 127,139 -4.9% 12.0%
Supplies 4,318 7,500 7,500 7,500 0.0% 0.0%
Contractual Services 21,038 28,750 20,500 20,500 -28.7% 0.0%
Communications 2,115 2,000 2,000 2,000 0.0% 0.0%
Fleet/Computer/Equipment Rental 28,049 28,049 31,270 31,270 11.5% 0.0%
Other Services & Charges 8,033 12,950 11,950 11,950 -7.7% 0.0%
Total 646,779 695,009 681,707 703,470 -1.9% 3.2%
_________________________________
City of Mercer Island 2011-2012 Budget G-37
Department Function:
Building Plan Review & Inspection Services
Description
Process, review, and complete all private, non-profit, and public (i.e. city, state, regional, and utility
entities) development permits, encompassing building plans examination and field inspection for code
compliance with issued permits. Conduct reviews of trees and vegetation on private property.
Priority of Government
#1 The community will be safe.
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Provide customer service and assistance on building permit requirements and processes.
• Provide public notice and information.
• Provide timely project information at early project design phase during pre-application process.
• Perform plans examination for compliance with applicable International Building Code (IBC) and
other ordinances within 3 weeks for express permits and 6 weeks for regular permits.
• Perform building site inspections to review conformance with plans and regulations.
• Update building codes, public safety requirements, and public information tip sheets.
• Provide on-line services for plan submittal and review, permits, inspections, and public information.
2011-2012 Key Initiatives
• Continue with contract Plans Examiner to provide timely review of residential and commercial
building permits.
• Provide electronic plan review to improve communication, lower customer costs, and improve
sustainability efforts.
• Absorb Fire plan review and construction inspection duties resulting from the elimination of the Fire
Marshal position in the Fire Department.
_________________________________
G-38 City of Mercer Island 2011-2012 Budget
Department Function:
Building Plan Review & Inspection Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 462,780 491,302 464,525 471,895 -5.5% 1.6%
Benefits 137,027 144,774 137,646 154,054 -4.9% 11.9%
Supplies 5,057 22,200 3,700 3,700 -83.3% 0.0%
Contractual Services 2,942 15,700 32,200 33,200 105.1% 3.1%
Communications 3,810 4,500 4,500 4,500 0.0% 0.0%
Fleet/Computer/Equipment Rental 39,278 39,278 28,744 28,744 -26.8% 0.0%
Other Services & Charges 4,510 12,900 10,400 10,400 -19.4% 0.0%
Capital 5,997 - - - 100.0% N/A
Total 661,401 730,654 681,715 706,493 -6.7% 3.6%
_________________________________
City of Mercer Island 2011-2012 Budget G-39
Department Function:
Development Engineering
Description
Conduct engineering review and site inspection of all land use and private development projects,
including the impact on and use of the City’s rights-of-way and utility infrastructure. Conduct
neighborhood and Town Center transportation planning and traffic management for all modes of travel.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Provide customer service assistance on utility and right-of-way options and requirements related to
private development.
• Provide guidance at detailed pre-application meetings.
• Conduct water, sewer, and storm drainage inspections for all private development
• Protect public utility and roadway infrastructure by ensuring that all private development conforms
to adopted engineering standards through quality permit review and field inspection
• Perform plan review and inspection of right-of-way permits
• Ensure implementation and enforcement of engineering standards associated with private
development
• Coordinate the annual update and adoption of the six year TIP
• Coordinate all modes of transportation improvements including transit, bicycles and pedestrians.
2011-2012 Key Initiatives
• Implementation of the National Pollution Discharge Elimination System (NPDES) Phase II Permit
requirements.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 330,446 360,767 233,913 237,975 -35.2% 1.7%
Benefits 89,197 102,273 69,819 78,230 -31.7% 12.0%
Supplies 688 8,500 6,500 6,500 -23.5% 0.0%
Contractual Services 9,633 104,600 18,750 18,750 -82.1% 0.0%
Communications 2,289 1,650 1,930 1,930 17.0% 0.0%
Fleet/Computer/Equipment Rental 20,837 20,837 18,803 18,803 -9.8% 0.0%
Other Services & Charges 1,875 5,175 3,075 3,375 -40.6% 9.8%
Capital 7,000 - - - N/A N/A
Total 461,965 603,802 352,790 365,563 -41.6% 3.6%
_________________________________
G-40 City of Mercer Island 2011-2012 Budget
Department Function:
Land Use Planning Services
Description
Process all land use and non-single family design review permit applications consistent with adopted
policies in the Comprehensive Plan and applicable Unified Land Development Code (ULDC) regulations
and within timeframes required by state law. These include rezones, code amendments, conditional use
permits, variances, deviations, subdivision plats, lot line adjustments, shoreline development permits and
exemptions, SEPA determinations, accessory dwelling units (ADU’s), all land use appeals, major new
construction, and minor revision design reviews, and staff administrative design reviews.
Priority of Government
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Conduct land use and non-single family design permit reviews.
• Provide property, zoning, and land use development information to customers.
• Conduct land use/zoning compliance reviews on all building permits.
• Conduct Critical Areas Ordinance (CAO) permit reviews.
• Provide staff support to Planning Commission, Design Commission, City Council, and selected
committees and task forces.
• Monitor, maintain, and update Comprehensive Plan, including annual buildable lands report.
• Administer and update Shoreline Master Program (required by State).
• Conduct required SEPA and other environmental reviews by Code Official.
• Prepare land development code amendments as requested by City Council or private sector/citizen
applicants.
2011-2012 Key Initiatives
• Completion of the Shoreline Master Program Update.
• Assist in developing Mercer Island School District Master Plan.
_________________________________
City of Mercer Island 2011-2012 Budget G-41
Department Function:
Land Use Planning Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 270,264 278,829 224,073 227,098 -19.6% 1.4%
Benefits 81,708 92,433 68,895 77,086 -25.5% 11.9%
Supplies 354 2,500 1,500 1,500 -40.0% 0.0%
Contractual Services 37,852 95,500 7,250 5,250 -92.4% -27.6%
Communications 700 1,000 1,000 1,000 0.0% 0.0%
Fleet/Computer/Equipment Rental 11,665 11,665 10,330 10,330 -11.4% 0.0%
Other Services & Charges 332 7,100 2,550 2,550 -64.1% 0.0%
Total 402,875 489,027 315,598 324,814 -35.5% 2.9%
_________________________________
G-42 City of Mercer Island 2011-2012 Budget
FINANCE DEPARTMENT
_________________________________
G-44 City of Mercer Island 2011-2012 Budget
Department:
Finance
Description
The Finance Department provides financial planning, analysis and reporting, treasury, and accounting
services for all of the City’s operations.
_________________________________
City of Mercer Island 2011-2012 Budget G-45
Department:
Finance
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Financial Services 7.00 7.00 7.00 7.00 0.0% 0.0%
Total Regular 7.00 7.00 7.00 7.00 0.0% 0.0%
Contracted (Temporary):
Financial Services - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
G-46 City of Mercer Island 2011-2012 Budget
Department:
Finance
2011-2012 Resources
Business & Occupation
Tax
3% Business License Fees
11%
Water Rates & Reserves
13%
General Purpose Revenue
55%
Sewer Rates & Reserves
14%
Stormwater Rates &
Other Chgs
4%
2011-2012 Uses
Equipment Rental
3% Other Services & Charges
Communications 3%
2%
Contractual Services
15%
Supplies
1%
Salaries & Wages
Benefits 58%
18%
_________________________________
City of Mercer Island 2011-2012 Budget G-47
Department:
Finance
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
Business & Occupation Tax 29,599 26,800 27,200 27,300 1.5% 0.4%
Business License Fees 117,035 110,000 110,000 110,000 0.0% 0.0%
Water Rates 68,197 76,697 138,265 139,245 80.3% 0.7%
Sewer Rates 67,500 75,947 164,465 134,245 116.6% -18.4%
Storm Water Rates 19,377 27,704 36,751 38,526 32.7% 4.8%
General Purpose Revenue 646,358 746,557 539,252 576,516 -27.8% 6.9%
Total Resources 948,066 1,063,705 1,015,933 1,025,832 -4.5% 1.0%
Uses:
Salaries & Wages 569,755 595,138 583,103 590,846 -2.0% 1.3%
Benefits 168,440 184,709 175,459 196,115 -5.0% 11.8%
Supplies 5,154 9,000 6,100 6,100 -32.2% 0.0%
Contractual Services 123,843 172,170 165,100 145,400 -4.1% -11.9%
Communications 19,466 30,300 19,900 20,500 -34.3% 3.0%
Fleet/Computer/Equip Rental 26,038 26,038 33,096 33,096 27.1% 0.0%
Other Services & Charges 35,369 46,350 33,175 33,775 -28.4% 1.8%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total Uses 948,066 1,063,705 1,015,933 1,025,832 -4.5% 1.0%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Financial Services 948,066 1,063,705 1,015,933 1,025,832 -4.5% 1.0%
Total 948,066 1,063,705 1,015,933 1,025,832 -4.5% 1.0%
_________________________________
G-48 City of Mercer Island 2011-2012 Budget
Department:
Finance
2011-2012 Budget Analysis
General & Beautification Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 883,357
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Direct charge utility billing positions to Utility Funds (141,616)
Financial system hardware support and consulting (17,850)
Salary & benefit savings (relative to 2010 budget) (15,681)
EMS rate study (15,000)
State audit costs (10,000)
Travel, tuition & registrations (5,000)
Other operating costs (1,758)
Subtotal (206,905) -23.4%
2011 Base Budget 676,452 -23.4%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 676,452 -23.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-49
Department:
Finance
2011-2012 Budget Analysis
General & Beautification Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 676,452
Plus 2012 General Inflationary Increases 22,364 3.3%
Plus (Less) 2012 Other Significant Changes:
EMS rate study 15,000
Subtotal 15,000 2.2%
2012 Base Budget 713,816 5.5%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 713,816 5.5%
_________________________________
G-50 City of Mercer Island 2011-2012 Budget
Department:
Finance
2011-2012 Budget Analysis
Water, Sewer & Storm Water Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 180,348
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Printing & postage (10,600)
Travel, tuition & registrations (5,975)
Salary & benefit savings (relative to 2010 budget) (5,604)
Other operating costs (304)
Direct charge utility billing positions to Utility Funds 141,616
Subtotal 119,133 66.1%
2011 Base Budget 299,481 66.1%
Plus 2011 Service Enhancement Requests:
Sewer rate model development 35,000
Water meter replacement assessment 5,000
Subtotal 40,000 22.2%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 339,481 88.2%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 339,481
Plus 2012 General Inflationary Increases 12,535 3.7%
Plus (Less) 2012 Other Significant Changes:
Prior year one-time costs & carryovers:
- Sewer rate model development (35,000)
- Water meter replacement assessment (5,000)
Subtotal (40,000) -11.8%
2012 Base Budget 312,016 -8.1%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 312,016 -8.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-51
Department Function:
Financial Services
Description
Prepare quarterly and annual financial reports, financial analyses, and long-range financial forecasts for
internal and external stakeholders. Oversee development of the City’s biennial budget. Coordinate
citywide performance measurement efforts. Provide accounts payable, utility administration (water,
sewer, stormwater, and EMS), business licensing and tax collection, accounts receivable, and treasury
management services.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Biennial budget document
• Annual financial statements
• Quarterly financial status report
• Annual, citywide performance measurement report (Mercer Island Dashboard)
• 6 year Capital Improvement Program
• 5 year financial forecasting model
• Water, sewer, stormwater, and EMS utility rate studies
• Other tax/fee studies (e.g. business licensing and B&O tax structure)
• Revenue and expenditure analyses
• Provide financial information to bond rating agencies
• Internal control policies
• Weekly processing of vendor payments
• Water meter reading, utility billing, and utility administration
• Business licensing
• Business and occupation tax billing
• Other miscellaneous accounts receivable
• Cash, investment, and debt management
2011-2012 Key Initiatives
• Develop investment policy to guide staff efforts to more actively manage City’s idle cash.
• Overhaul the Sewer rate model, making it easier to perform “what if” analysis.
• Draft a comprehensive set of accounting policies and procedures.
• Conduct the emergency medical services (EMS) biennial rate study.
_________________________________
G-52 City of Mercer Island 2011-2012 Budget
Department Function:
Financial Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 569,755 595,138 583,103 590,846 -2.0% 1.3%
Benefits 168,440 184,709 175,459 196,115 -5.0% 11.8%
Supplies 5,154 9,000 6,100 6,100 -32.2% 0.0%
Contractual Services 123,843 172,170 165,100 145,400 -4.1% -11.9%
Communications 19,466 30,300 19,900 20,500 -34.3% 3.0%
Fleet/Computer/Equipment Rental 26,038 26,038 33,096 33,096 27.1% 0.0%
Other Services & Charges 35,369 46,350 33,175 33,775 -28.4% 1.8%
Total 948,066 1,063,705 1,015,933 1,025,832 -4.5% 1.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-53
_________________________________
G-54 City of Mercer Island 2011-2012 Budget
FIRE DEPARTMENT
_________________________________
G-56 City of Mercer Island 2011-2012 Budget
Department:
Fire
Description
The Fire Department’s primary mission is to protect the community by preventing, intervening, or
controlling events that left unchecked would result in property loss, injury, or loss of life. The
Department delivers these services via a tiered methodology involving public education, code
enforcement, and emergency and non-emergency intervention systems. These systems are organized
into five functional areas; 1) administration, 2) operations, 3) code enforcement, 4) training, and 5)
public education.
_________________________________
City of Mercer Island 2011-2012 Budget G-57
Department:
Fire
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration 3.00 3.00 3.00 3.00 0.0% 0.0%
Operations 28.00 28.00 28.00 28.00 0.0% 0.0%
Fire Code Enforcement - - - - N/A N/A
Training - - - - N/A N/A
Public Education - - - - N/A N/A
Total Regular 31.00 31.00 31.00 31.00 0.0% 0.0%
Contracted (Temporary):
Administration - - - - N/A N/A
Operations - - - - N/A N/A
Fire Code Enforcement 1.00 1.00 - - -100.0% N/A
Training - - - - N/A N/A
Public Education - - - - N/A N/A
Total Contracted 1.00 1.00 - - -100.0% N/A
_________________________________
G-58 City of Mercer Island 2011-2012 Budget
Department:
Fire
2011-2012 Resources
Ambulance Transport Fee Development Permit Fees
3% 0%
King County EMS Levy
8%
EMS Charge for Service
8%
General Purpose Revenue
81%
2011-2012 Uses
Equipment Rental Other
4% 1%
Contract Services Intergovernmental
1% Services
4%
Supplies
3%
Benefits
18%
Salaries & Wages
70%
_________________________________
City of Mercer Island 2011-2012 Budget G-59
Department:
Fire
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
Ambulance Transport Fee - - 262,500 26,250 N/A -90.0%
Development Permit Fees 28,389 34,000 12,050 12,050 -64.6% 0.0%
State & Local Grants 3,259 1,500 1,500 1,500 0.0% 0.0%
King County EMS Levy 397,249 394,091 394,091 394,091 0.0% 0.0%
EMS Charge for Service 317,222 315,000 411,300 415,300 30.6% 1.0%
Other Charges for Service 3,438 7,000 3,500 3,500 -50.0% 0.0%
Donations 870 2,000 1,000 1,000 -50.0% 0.0%
Miscellaneous 47,100 2,000 2,000 2,000 0.0% 0.0%
General Purpose Revenue 3,887,581 4,226,768 3,829,716 4,207,984 -9.4% 9.9%
Total Resources 4,685,107 4,982,359 4,917,657 5,063,675 -1.3% 3.0%
Uses:
Salaries & Wages 3,429,737 3,474,882 3,429,660 3,507,142 -1.3% 2.3%
Benefits 733,717 884,150 853,479 916,161 -3.5% 7.3%
Supplies 109,416 161,434 160,684 161,684 -0.5% 0.6%
Contractual Services 49,332 67,225 67,225 67,225 0.0% 0.0%
Communications 15,935 27,606 11,800 11,800 -57.3% 0.0%
Fleet/Computer/Equip Rental 157,691 166,868 175,482 175,482 5.2% 0.0%
Other Services & Charges 19,278 22,425 21,700 22,400 -3.2% 3.2%
Intergovernmental Services 170,001 177,769 197,627 201,781 11.2% 2.1%
Capital - - - - N/A N/A
Total Uses 4,685,107 4,982,359 4,917,657 5,063,675 -1.3% 3.0%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration 533,292 561,040 493,873 506,873 -12.0% 2.6%
Operations 3,911,956 4,150,805 4,281,026 4,408,805 3.1% 3.0%
Fire Code Enforcement 121,451 121,217 15,926 19,550 -86.9% 22.8%
Training 97,069 117,609 118,626 120,241 0.9% 1.4%
Public Education 21,340 31,688 8,206 8,206 -74.1% 0.0%
Total 4,685,107 4,982,359 4,917,657 5,063,675 -1.3% 3.0%
_________________________________
G-60 City of Mercer Island 2011-2012 Budget
Department:
Fire
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 4,982,359
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (52,414)
Cellular phone & pager costs (15,806)
Other operating costs 5,339
NORCOM dispatch services 20,858
Firefighter overtime (correction to historical experience) 60,099
Subtotal 18,076 0.4%
2011 Base Budget 5,000,435 0.4%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
Eliminate Fire Marshal (1.0 FTE reduction) (82,778)
Subtotal (82,778)
2011 Final Budget 4,917,657 -1.3%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 4,917,657
Plus 2012 General Inflationary Increases 146,018 3.0%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 5,063,675 3.0%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 5,063,675 3.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-61
Department Function:
Administration
Description
This function encompasses all the administrative and program support necessary to accomplish the
mission of the department.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Provide support for all department programs and initiatives.
• Maintain inventory of office supplies and equipment for staff.
• Manage networked copy/printing service for staff.
• Conduct assessment/promotional exams.
• Participate in regional fire and EMS initiatives and programs.
• Coordinate fire public education efforts and programs.
2011-2012 Key Initiatives
• Identify opportunities to implement more efficient solutions to existing administrative processes,
capitalizing on sustainability opportunities.
• Continue to identify and implement cost controls and efficiencies for Department expenditures.
• Identify funding for Station 92 design & construction
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 344,272 331,728 330,703 335,145 -0.3% 1.3%
Benefits 74,191 96,113 92,980 101,538 -3.3% 9.2%
Supplies 21,490 32,825 32,825 32,825 0.0% 0.0%
Contractual Services 19,194 21,465 21,465 21,465 0.0% 0.0%
Communications 4,607 5,000 - - -100.0% N/A
Fleet/Computer/Equipment Rental 65,307 67,509 9,500 9,500 -85.9% 0.0%
Other Services & Charges 4,230 6,400 6,400 6,400 0.0% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total 533,292 561,040 493,873 506,873 -12.0% 2.6%
_________________________________
G-62 City of Mercer Island 2011-2012 Budget
Department Function:
Operations
Description
This function encompasses the delivery of Fire, Rescue, and Emergency Medical services to the Mercer
Island community and neighboring communities per mutual aid agreements with the objective of
eliminating or reducing the impacts of injury or property damage. Fire Operations include all elements
necessary to deliver these services such as support, maintenance, and preparation of systems necessary
for the delivery of services.
Priority of Government
#1 The community will be safe.
Services & Products
• Respond to all fire, emergency medical, and rescue calls for service.
• Provide dive team services collaboratively with Mercer Island Police Department.
• Respond to all water rescue incidents.
• Coordinate maintenance of all department fire apparatus, vehicles and equipment.
• Maintain operational supplies and equipment inventories.
• Provide blood pressure checking services to the community.
• Contract with City of Bellevue/NORCOM for dispatch services.
• Maintain and service all City fire extinguishers.
2011-2012 Key Initiatives
• Prepare bid specifications for apparatus replacement and replace aid unit.
• Continue to identify and implement fuel saving strategies.
• Increase cardiac survival rates for Mercer Island community.
• Complete SERRA Project.
• Provide responding fire officers with comprehensive pre-incident information thereby increasing
safety and reducing loss.
_________________________________
City of Mercer Island 2011-2012 Budget G-63
Department Function:
Operations
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 2,902,454 2,939,152 2,997,005 3,066,506 2.0% 2.3%
Benefits 634,793 762,306 757,999 812,123 -0.6% 7.1%
Supplies 80,870 116,303 116,303 116,303 0.0% 0.0%
Contractual Services 19,745 33,260 33,260 33,260 0.0% 0.0%
Communications 10,535 22,606 11,800 11,800 -47.8% 0.0%
Fleet/Computer/Equipment Rental 92,384 99,359 165,982 165,982 67.1% 0.0%
Other Services & Charges 1,174 1,050 1,050 1,050 0.0% 0.0%
Intergovernmental Services 170,001 176,769 197,627 201,781 11.8% 2.1%
Capital - - - - N/A N/A
Total 3,911,956 4,150,805 4,281,026 4,408,805 3.1% 3.0%
_________________________________
G-64 City of Mercer Island 2011-2012 Budget
Department Function:
Fire Code Enforcement
Description
This function encompasses all aspects of preventing injury or property loss by assisting DSG with
building plan reviews for compliance with adopted fire codes; annual company fire inspections by
operational staff; occupancy inspections and permitting by the Fire Code Official; and management of the
fire inspection program and data collection and reporting to applicable State and Federal Agencies.
Priority of Government
#1 The community will be safe.
Services & Products
• Administer and enforce all applicable federal, state and local fire and life safety codes.
• Develop and prepare amendments to fire, life safety, and building codes reflecting solutions to latest
trends and techniques in building construction and findings from fire loss statistics.
• Review zone changes and lot divisions and devise solutions to diverse land development projects.
• Manage fire inspection program.
• Manage the Company Fire Inspection Program
• Assist Development Services staff with plan review services for all new and re-model construction
projects on the Island.
• Assist Development Services staff with Code and Fire Loss related issues.
2011-2012 Key Initiatives
• Assess impacts and opportunities from International Fire Code adoption.
• Identify opportunities to reduce commercial building owner’s insurance premiums.
• Reduce property and content loss.
• Integrate of Community Risk Reduction Strategy.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 90,975 90,386 11,076 13,000 -87.7% 17.4%
Benefits 21,824 24,931 2,500 2,500 -90.0% 0.0%
Supplies 1,648 2,250 1,500 2,500 -33.3% 66.7%
Communications 752 - - - N/A N/A
Other Services & Charges 6,253 3,650 850 1,550 -76.7% 82.4%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total 121,451 121,217 15,926 19,550 -86.9% 22.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-65
Department Function:
Training
Description
This function is responsible for ensuring that operational staff are fully trained and certified to provide all
types of emergency services to the community. It ensures that department staff meet, or exceed, all
applicable standards and regulatory requirements with respect to training. It encompasses all the
programmatic elements of the Fire Department training programs assuring that the highest level of
safety and professionalism are practiced in every aspect of pursuing our goals and objectives.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Develop monthly, quarterly, and annual training requirements.
• Ensure firefighters meet minimum training requirements in a safe and effective manner.
• Attend regional training meetings.
• Develop training programs and objectives based on department needs, keeping firefighters in a state
of readiness.
• Keep firefighters updated on current trends and technology.
• Manage training and re-certifications for all department Emergency Medical Technicians.
2011-2012 Key Initiatives
• Implement succession & mentoring plan developed in 2010.
• Maintain competency in all skills and abilities needed to perform the mission of the Mercer Island
Fire Department.
• Develop solutions to integrate new legislative restrictions while maintaining required training for
operations staff.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 76,343 89,309 90,876 92,491 1.8% 1.8%
Benefits 1,953 800 - - -100.0% N/A
Supplies 717 3,000 3,000 3,000 0.0% 0.0%
Contractual Services 10,393 12,500 12,500 12,500 0.0% 0.0%
Communications 42 - - - N/A N/A
Other Services & Charges 7,621 11,000 12,250 12,250 11.4% 0.0%
Intergovernmental Services - 1,000 - - -100.0% N/A
Total 97,069 117,609 118,626 120,241 0.9% 1.4%
_________________________________
G-66 City of Mercer Island 2011-2012 Budget
Department Function:
Public Education
Description
This function is responsible for eliminating or reducing injury or property loss through public outreach.
It includes the delivery of information through a variety of mediums and programs providing classes and
educational opportunities to individuals and groups.
Priority of Government
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Provide CPR, first aid, and fire extinguisher classes and information.
• Conduct DUI drills for Mercer Island High School.
• Offer the following programs: Physicians Orders for Life-Sustaining Treatment (POLST), HIPAA
Information, Post Fire Assistance, Station Tour, Safety Talk, and Birthday Party.
• Attend public events such as Public Safety Days, Summer Celebration!, Pancake Breakfast Food
Drive, Fire House Munch, and JCC Truck Days.
2011-2012 Key Initiatives
• Identify community incident trends and develop appropriate educational opportunities based on a
risk / benefit assessment model.
• Identify opportunities to provide information to the community using existing technologies.
• Assist commercial occupancies with developing and deploying incident action plans.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 15,694 24,307 - - -100.0% N/A
Benefits 955 - - - N/A N/A
Supplies 4,691 7,056 7,056 7,056 0.0% 0.0%
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Other Services & Charges - 325 1,150 1,150 253.8% 0.0%
Capital - - - - N/A N/A
Total 21,340 31,688 8,206 8,206 -74.1% 0.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-67
_________________________________
G-68 City of Mercer Island 2011-2012 Budget
HUMAN RESOURCES
_________________________________
G-70 City of Mercer Island 2011-2012 Budget
Department:
Human Resources
Description
The Human Resources Department encompasses human resources and payroll services for the City.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Admin & Human Resources 2.00 2.00 2.00 2.00 0.0% 0.0%
Payroll Services 1.00 1.00 1.00 1.00 0.0% 0.0%
Total Regular 3.00 3.00 3.00 3.00 0.0% 0.0%
Contracted (Temporary):
Admin & Human Resources - - - - N/A N/A
Payroll Services - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-71
Department:
Human Resources
2011-2012 Resources
General Purpose Revenue
100%
2011-2012 Uses
Equipment Rental
Other Services & Charges
Communications 2%
2%
1%
Contractual Services
17%
Supplies
2%
Salaries & Wages
58%
Benefits
18%
_________________________________
G-72 City of Mercer Island 2011-2012 Budget
Department:
Human Resources
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
General Purpose Revenue 463,171 491,575 452,766 465,457 -7.9% 2.8%
Total Resources 463,171 491,575 452,766 465,457 -7.9% 2.8%
Uses:
Salaries & Wages 267,702 280,317 267,443 270,967 -4.6% 1.3%
Benefits 82,201 87,730 78,948 88,115 -10.0% 11.6%
Supplies 10,764 12,150 8,700 8,700 -28.4% 0.0%
Contractual Services 71,438 72,500 77,000 77,000 6.2% 0.0%
Communications 3,159 3,500 3,500 3,500 0.0% 0.0%
Fleet/Computer/Equip Rental 10,178 10,178 8,025 8,025 -21.2% 0.0%
Other Services & Charges 17,730 25,200 9,150 9,150 -63.7% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total Uses 463,171 491,575 452,766 465,457 -7.9% 2.8%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Admin & Human Resources 341,634 371,095 332,104 341,432 -10.5% 2.8%
Payroll Services 121,538 120,480 120,662 124,025 0.2% 2.8%
Total 463,171 491,575 452,766 465,457 -7.9% 2.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-73
Department:
Human Resources
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 491,575
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (21,656)
Advertising (7,000)
Tuition assistance program (5,000)
Travel, tuition & registrations (4,700)
Other operating costs (453)
Subtotal (38,809) -7.9%
2011 Base Budget 452,766 -7.9%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 452,766 -7.9%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 452,766
Plus 2012 General Inflationary Increases 12,691 2.8%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 465,457 2.8%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 465,457 2.8%
_________________________________
G-74 City of Mercer Island 2011-2012 Budget
Department Function:
Administration & Human Resources
Description
Plan, organize, develop, and administer uniform Human Resources policies, procedures, and programs.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Recruit and fill vacant full and part-time positions.
• Negotiate labor agreements with unions.
• Advise department directors and supervisors on interpretation and application of human resource
policies and procedures and provide technical expertise on human resources management related
issues.
• Coordinate city-wide training.
• Through an effective performance evaluation process and by utilizing pay-for-performance, ensure
employees receive annual feedback on their performance.
• Manage the citywide employee recognition and service award program.
• Manage the City's benefit programs.
• Maintain and update HRIS database and evaluate processes for data collection.
• Prepare annual benefit statements and conduct employee orientations and exit interviews.
• Maintain accurate central employee records.
• Assist managers and supervisors with employee-related issues.
• Develop and implement comprehensive proposals for new programs or major revisions of existing
programs to enhance the efficiency, effectiveness, and quality of City workforce or work
environment where consistent with Council priorities.
• Staff the Civil Service Commission and Disability Board.
• Obtain cooperation and sensitively resolve interpersonal problems through the application of
communications and interpersonal skills.
2011-2012 Key Initiatives
• Explore alternative options for providing cost-effective and quality medical insurance for employees.
• Update and distribute Employee Handbook.
• Review all HR processes and procedures and make efficient, streamlined, and customer service
related improvements.
_________________________________
City of Mercer Island 2011-2012 Budget G-75
Department Function:
Administration & Human Resources
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 202,621 214,050 203,111 205,766 -5.1% 1.3%
Benefits 62,168 65,217 57,668 64,341 -11.6% 11.6%
Supplies 8,130 11,650 8,200 8,200 -29.6% 0.0%
Contractual Services 38,188 42,500 43,000 43,000 1.2% 0.0%
Communications 3,159 3,500 3,500 3,500 0.0% 0.0%
Fleet/Computer/Equipment Rental 10,178 10,178 8,025 8,025 -21.2% 0.0%
Other Services & Charges 17,190 24,000 8,600 8,600 -64.2% 0.0%
Total 341,634 371,095 332,104 341,432 -10.5% 2.8%
_________________________________
G-76 City of Mercer Island 2011-2012 Budget
Department Function:
Payroll Services
Description
Process the City’s bi-weekly payroll, culminating in the issuance of checks to employees and payment
transmittals to various employee benefits vendors, the state, and federal government agencies.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Process and transmit bi-weekly payroll for 200+ employees.
• Enter payroll labor tracking information into the City’s financial system.
• Prepare, balance, and process payments to benefits vendors.
• Process payroll quarterly reports required by state and federal law.
• Respond to employee and retiree inquiries related to payroll and/or retirement payments.
• Maintain employees’ payroll information in the Payroll/HR system and the City’s financial system.
• Ensure compliance with payroll-related laws and regulations.
• Maintain payroll and tax filing-related records.
• Process leave accrual reports for employees and maintain all leave accrual records.
• Administer the reporting of retirement earnings for City employees into four separate retirement
systems.
• Process payments for supplemental retirement benefits for LEOFF I retirees.
• Maintain and monitor worker’s compensation claims and process reports to ensure compliance with
state regulations.
2011-2012 Key Initiatives
• Automate benefits administration and enrollment and provide employee access to payroll and
benefits information through an internet-based system.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 65,082 66,267 64,332 65,201 -2.9% 1.4%
Benefits 20,033 22,513 21,280 23,774 -5.5% 11.7%
Supplies 2,634 500 500 500 0.0% 0.0%
Contractual Services 33,249 30,000 34,000 34,000 13.3% 0.0%
Other Services & Charges 540 1,200 550 550 -54.2% 0.0%
Total 121,538 120,480 120,662 124,025 0.2% 2.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-77
_________________________________
G-78 City of Mercer Island 2011-2012 Budget
MAINTENANCE DEPARTMENT
_________________________________
G-80 City of Mercer Island 2011-2012 Budget
Department:
Maintenance
Description
The Maintenance Department consists of the following functions: 1) administration, 2) capital projects
engineering, 3) right of way services, 4) water utility services, 5) sewer utility services, 6) stormwater
utility services, 7) solid waste services, 8) facilities services, 9) fleet services, and 10) customer field
response services. The capital projects engineering function is fully budgeted and accounted for within
the City’s Capital Improvement Program (CIP). All of these functions are organized around 4 teams:
1) Capital Projects, 2) Right-of-Way, 3) Utilities, and 4) Support Services.
_________________________________
City of Mercer Island 2011-2012 Budget G-81
Department:
Maintenance
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration 2.80 2.80 3.20 3.20 14.3% 0.0%
Right-of-Way Services 6.50 6.50 5.50 5.50 -15.4% 0.0%
Water Utility Services 6.40 6.40 6.50 6.50 1.6% 0.0%
Sewer Utility Services 4.40 4.40 4.50 4.50 2.3% 0.0%
Stormwater Utility Services 2.70 2.70 2.50 2.50 -7.4% 0.0%
Solid Waste Services - - - - N/A N/A
Facilities Services 1.00 1.00 0.50 0.50 -50.0% 0.0%
Fleet Services 1.20 1.20 1.20 1.20 0.0% 0.0%
Customer Field Response Svcs 2.00 2.00 2.00 2.00 0.0% 0.0%
Total Regular 27.00 27.00 25.90 25.90 -4.1% 0.0%
Contracted (Temporary):
Administration - - - - N/A N/A
Right-of-Way Services 0.50 0.50 - - -100.0% N/A
Water Utility Services - - - - N/A N/A
Sewer Utility Services - - - - N/A N/A
Stormwater Utility Services - - - - N/A N/A
Solid Waste Services - - - - N/A N/A
Facilities Services 0.25 0.25 0.25 - 0.0% -100.0%
Fleet Services - - - - N/A N/A
Customer Field Response Svcs - - - - N/A N/A
Total Contracted 0.75 0.75 0.25 - -66.7% -100.0%
_________________________________
G-82 City of Mercer Island 2011-2012 Budget
Department:
Maintenance
2011-2012 Resources
General Purpose Revenue
12%
State and Local Grants
B&O Tax
1%
1%
Internal Charges
4% Water Rates
27%
Stormwater Rates
6%
Sewer Rates
48%
2011-2012 Uses
Debt Service Salaries & Wages
9% 15%
General Admin Support
3% Benefits
5%
Supplies
5%
KC Sewer Treatment
28%
Water Purchases
13%
Contract Services
Other 10%
3%
Utilities
Insurance Equipment Rental
3%
2% 4%
_________________________________
City of Mercer Island 2011-2012 Budget G-83
Department:
Maintenance
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - - - - N/A N/A
Business & Occupation Tax 139,845 170,000 166,453 166,948 -2.1% 0.3%
Real Estate Excise Tax 97,968 125,989 80,000 80,000 -36.5% 0.0%
Water Rates & Other Chgs 3,405,938 3,415,921 3,411,562 3,830,228 -0.1% 12.3%
Sewer Rates & Other Chgs 4,877,131 5,890,865 6,341,383 6,417,729 7.6% 1.2%
Stormwater Rates & Other Chgs 808,683 986,815 847,770 876,561 -14.1% 3.4%
Internal Charges 431,968 510,777 485,227 500,496 -5.0% 3.1%
State and Local Grants 80,802 87,355 101,134 94,134 15.8% -6.9%
General Purpose Revenue 1,745,985 1,880,978 1,639,875 1,676,849 -12.8% 2.3%
Total Resources 11,588,320 13,068,700 13,073,404 13,642,945 0.0% 4.4%
Uses:
Salaries & Wages 1,947,628 2,107,888 1,923,781 1,954,770 -8.7% 1.6%
Benefits 670,744 709,708 640,685 705,247 -9.7% 10.1%
Supplies 596,057 624,800 629,900 647,900 0.8% 2.9%
Water Purchases 1,617,528 1,544,927 1,614,113 1,856,230 4.5% 15.0%
Contractual Services 1,150,781 1,495,730 1,275,734 1,287,234 -14.7% 0.9%
Communications 66,015 50,900 54,200 54,400 6.5% 0.4%
Fleet/Computer/Equip Rental 455,879 469,122 478,499 478,499 2.0% 0.0%
Insurance 178,960 197,800 249,607 265,938 26.2% 6.5%
Utilities 404,881 402,097 418,672 441,106 4.1% 5.4%
Other Services & Charges 424,073 436,725 446,526 480,411 2.2% 7.6%
King County Sewage Treatment 3,305,490 3,315,000 3,771,345 3,790,200 13.8% 0.5%
Intergovernmental Services 18,769 20,620 21,520 22,520 4.4% 4.6%
General Administration Support 555,600 589,000 392,129 409,062 -33.4% 4.3%
Debt Service (Principal & Int) 195,914 1,104,383 1,156,693 1,249,428 4.7% 8.0%
Capital - - - - N/A N/A
Total Uses 11,588,320 13,068,700 13,073,404 13,642,945 0.0% 4.4%
_________________________________
G-84 City of Mercer Island 2011-2012 Budget
Department:
Maintenance
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration 466,606 493,566 526,594 540,806 6.7% 2.7%
Right-of-Way Services 1,364,150 1,478,245 1,229,362 1,253,746 -16.8% 2.0%
Water Utility Services 3,237,117 3,242,170 3,230,457 3,643,790 -0.4% 12.8%
Sewer Utility Services 4,717,300 5,717,114 6,160,278 6,231,291 7.8% 1.2%
Stormwater Utility Services 695,866 863,064 731,799 755,257 -15.2% 3.2%
Solid Waste Services 45,466 50,750 50,900 50,900 0.3% 0.0%
Facilities Services 441,677 503,974 460,712 461,464 -8.6% 0.2%
Fleet Services 431,968 510,777 485,227 500,496 -5.0% 3.1%
Customer Field Response Services 188,169 209,040 198,075 205,195 -5.2% 3.6%
Total 11,588,320 13,068,700 13,073,404 13,642,945 0.0% 4.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-85
Department:
Maintenance
2011-2012 Budget Analysis
General, Street & Beautification Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 2,214,322
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- Town Center improvements (35,000)
- Resource Conservation Manager (24,226)
Salary & benefit savings (relative to 2010 budget) (65,561)
Contracted services, repair and maintenance (16,950)
Operating supplies (7,300)
Other operating costs (2,515)
Travel, tuition & registrations (1,650)
Utility costs (PSE, water, garbage) 37,175
Subtotal (116,027) -5.2%
2011 Base Budget 2,098,295 -5.2%
Plus 2011 Service Enhancement Requests:
Retain contract Conservation Manager (0.25 FTE) 7,357
Improve Town Center beautification level of service 153
Subtotal 7,510 0.3%
Less 2011 Service Reduction Proposals:
ROW Trail Maintenance position (1.0 FTE reduction) (84,217)
Contract ROW Arborist position (0.5 FTE reduction) (44,244)
Facilities Maintenance Technician (0.5 FTE reduction) (42,866)
Reduce ROW casual labor (12,150)
Subtotal (183,477)
2011 Final Budget 1,922,328 -13.2%
_________________________________
G-86 City of Mercer Island 2011-2012 Budget
Department:
Maintenance
2011-2012 Budget Analysis
General, Street & Beautification Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 1,922,328
Plus 2012 General Inflationary Increases 38,093 2.0%
Plus (Less) 2012 Other Significant Changes:
Prior year one-time costs & carryovers:
- Contract Conservation Manager (0.25 FTE) (7,624)
Subtotal (7,624) -0.4%
2012 Base Budget 1,952,797 1.6%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 1,952,797 1.6%
_________________________________
City of Mercer Island 2011-2012 Budget G-87
Department:
Maintenance
2011-2012 Budget Analysis
Equipment Rental Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 510,777
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Contracted services, repair and maintenance (21,000)
Salary & benefit savings (relative to 2010 budget) (2,050)
Other operating costs (2,500)
Subtotal (25,550) -5.0%
2011 Base Budget 485,227 -5.0%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None
Subtotal -
2011 Final Budget 485,227 -5.0%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 485,227
Plus 2012 General Inflationary Increases 15,269 3.1%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 500,496 3.1%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 500,496 3.1%
_________________________________
G-88 City of Mercer Island 2011-2012 Budget
Department:
Maintenance
2011-2012 Budget Analysis
Water, Sewer & Storm Water Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 10,343,601
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Admin, insurance & facilities charges paid to General Fund (165,783)
Prior year one-time costs and carryovers:
- Stormwater maintenance (carryover) (90,630)
- NPDES Phase 11 grant costs (50,000)
Salary & benefit savings (relative to 2010 budget) (66,983)
Emergency well operating supplies 8,000
Other operating costs 13,549
State utility taxes 31,120
Debt service 52,310
Water purchases & sewage treatment 525,531
Subtotal 257,114 2.5%
2011 Base Budget 10,600,715 2.5%
Plus 2011 Service Enhancement Requests:
NPDES grant program 65,134
Subtotal 65,134 0.6%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 10,665,849 3.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-89
Department:
Maintenance
2011-2012 Budget Analysis
Water, Sewer & Storm Water Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 10,665,849
Plus 2012 General Inflationary Increases 523,803 4.9%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 11,189,652 4.9%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 11,189,652 4.9%
_________________________________
G-90 City of Mercer Island 2011-2012 Budget
Department Function:
Administration
Description
Provide direction and administrative support to the Capital Projects, Right-of-Way, Utilities, and
Support Services teams.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Maintain computerized maintenance management system.
• Provide warehouse services.
• Conduct monthly safety meetings.
• Coordinate department training.
• Maintain timekeeping and other personnel records.
• Coordinate purchasing and record keeping for fleet services.
2011-2012 Key Initiatives
• Maintain current service levels.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 281,104 288,568 299,620 303,576 3.8% 1.3%
Benefits 84,524 86,833 86,940 97,196 0.1% 11.8%
Supplies 6,793 5,200 4,800 4,800 -7.7% 0.0%
Contractual Services 21,608 32,200 30,800 30,800 -4.3% 0.0%
Communications 15,334 17,600 16,000 16,000 -9.1% 0.0%
Fleet/Computer/Equipment Rental 49,645 49,645 71,314 71,314 43.6% 0.0%
Other Services & Charges 5,570 11,000 14,600 14,600 32.7% 0.0%
Intergovernmental Services 2,028 2,520 2,520 2,520 0.0% 0.0%
Total 466,606 493,566 526,594 540,806 6.7% 2.7%
_________________________________
City of Mercer Island 2011-2012 Budget G-91
Department Function:
Right-of-Way Services
Description
Provide all aspects of maintenance for 84 miles of public roadways, from sweeping and pothole repairs
to sign installation and street light repairs. Manage trees in the public right-of-way for health and safety,
control roadside vegetation to ensure safe sight distances and vehicle clearances, maintain sidewalks, and
maintain planter beds on Island Crest Way and in the Town Center.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Patch potholes, utility cuts, and other roadway problem spots.
• Install and maintain traffic signs.
• Maintain traffic signals.
• Sweep streets.
• Remove snow and ice.
• Maintain roadway shoulders.
• Maintain City-owned street lights.
• Replace pavement markings.
• Repair guardrails.
• Clean catch-basins and shallow ditches.
• Mow roadside vegetation.
• Maintain sidewalks.
• Prune major roadside hedges.
• Evaluate and remove hazardous trees.
• Remove and replace problem trees.
• Maintain planter beds on Island Crest Way.
• Maintain Town Center planted medians.
2011-2012 Key Initiatives
• Continue replacement program for wooden street light poles.
• Use new technology to prevent icing problems on City streets.
• Re-plant eroded and unsightly right-of-way locations to control erosion and improve tree canopy.
• Remove sight obstructions caused by encroaching vegetation.
• Evaluate street sweeping frequency and methods to reduce non-point pollution reaching Lake
Washington.
• Increase monitoring and abatement of ROW encroachments.
• Increase Town Center Beautification efforts to include sidewalk repairs, tree gate replacements, and
removal/replacement of diseased and dying trees.
• Continue pavement marking efforts.
_________________________________
G-92 City of Mercer Island 2011-2012 Budget
Department Function:
Right-of-Way Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 471,261 493,299 396,004 400,698 -19.7% 1.2%
Benefits 174,462 175,703 138,692 153,382 -21.1% 10.6%
Supplies 99,236 94,100 73,100 73,100 -22.3% 0.0%
Contractual Services 287,172 395,100 313,100 318,100 -20.8% 1.6%
Communications 20,174 1,300 500 500 -61.5% 0.0%
Fleet/Computer/Equipment Rental 191,214 200,393 194,816 194,816 -2.8% 0.0%
Utilities 117,683 109,000 106,300 106,300 -2.5% 0.0%
Other Services & Charges 2,947 9,350 6,850 6,850 -26.7% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total 1,364,150 1,478,245 1,229,362 1,253,746 -16.8% 2.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-93
Department Function:
Water Utility Services
Description
Provide business administration services and operational support to the City's water utility. Provide the
full range of maintenance activities and operational expertise required for reliable 24-hour services from
the City's water utility. Ensure compliance with all state and federal rules and regulations for public
utilities.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Purchase wholesale water from the City of Seattle.
• Issue water conservation alerts and provide public education on water usage.
• Ensure compliance with federal and state regulations.
• Provide safe and reliable water for domestic use and fire protection.
• Operate, maintain, and repair reservoirs, pumping stations, distribution lines, valves, hydrants, and
meters.
2011-2012 Key Initiatives
• Continue Leak Detection effort to reduce unaccounted for water use as required by State Water
Efficiency rules.
• Improve reservoir security through enhanced surveillance system, fence repairs, and automated
security gate.
• Continue replacing larger meters to reduce unaccounted for water loss.
• Train City utility crew and emergency management volunteers in the operation and use of the
emergency well located in Rotary Park.
_________________________________
G-94 City of Mercer Island 2011-2012 Budget
Department Function:
Water Utility Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 437,991 483,131 456,731 472,883 -5.5% 3.5%
Benefits 151,317 161,882 154,281 171,363 -4.7% 11.1%
Supplies 140,404 178,700 196,250 206,250 9.8% 5.1%
Water Purchases 1,617,528 1,544,927 1,614,113 1,856,230 4.5% 15.0%
Contractual Services 191,517 153,300 95,800 96,300 -37.5% 0.5%
Communications 6,638 7,000 7,700 7,900 10.0% 2.6%
Fleet/Computer/Equipment Rental 96,783 95,305 99,229 99,229 4.1% 0.0%
Insurance 53,200 58,400 78,674 83,926 34.7% 6.7%
Utilities 31,506 42,000 53,000 53,000 26.2% 0.0%
Other Services & Charges 253,701 245,525 264,734 286,821 7.8% 8.3%
Intergovernmental Services 6,533 7,000 7,000 7,000 0.0% 0.0%
General Administration Support 250,000 265,000 176,425 184,043 -33.4% 4.3%
Debt Service (Principal & Interest) - - 26,520 118,845 N/A 348.1%
Capital - - - - N/A N/A
Total 3,237,117 3,242,170 3,230,457 3,643,790 -0.4% 12.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-95
Department Function:
Sewer Utility Services
Description
Provide business administration services and operational support to the City's sewer utility. Provide the
full range of maintenance activities and operational expertise required for reliable 24-hour services from
the City's sewer utility. Ensure compliance with all state and federal rules and regulations for public
utilities.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Contract for sewage treatment services (METRO).
• Ensure compliance with federal and state regulations.
• Clean, inspect, and maintain the sanitary sewer system to ensure effective service while preventing
property damage.
2011-2012 Key Initiatives
• Complete final phase of sewer telemetry improvements.
• Complete comprehensive sewer video inspection program with focus on backup prevention.
• Continue contracted services for sewer cleaning to reverse upward trend in claims from backups.
• Correct deteriorating conditions in sewer collection system through prioritized repair and
rehabilitation projects.
• Implement recommendation for preventing backups in the sewer lake line.
_________________________________
G-96 City of Mercer Island 2011-2012 Budget
Department Function:
Sewer Utility Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 325,469 339,919 319,391 331,496 -6.0% 3.8%
Benefits 107,922 112,790 107,778 119,521 -4.4% 10.9%
Supplies 48,873 47,000 55,750 55,750 18.6% 0.0%
Contractual Services 179,259 213,500 244,000 245,500 14.3% 0.6%
Communications 23,869 25,000 30,000 30,000 20.0% 0.0%
Fleet/Computer/Equipment Rental 48,072 50,122 43,199 43,199 -13.8% 0.0%
Insurance 53,200 58,400 96,859 104,123 65.9% 7.5%
Utilities 42,753 44,000 45,000 45,000 2.3% 0.0%
Other Services & Charges 136,479 142,000 140,358 151,876 -1.2% 8.2%
King County Sewage Treatment 3,305,490 3,315,000 3,771,345 3,790,200 13.8% 0.5%
General Administration Support 250,000 265,000 176,425 184,043 -33.4% 4.3%
Debt Service (Principal & Interest) 195,914 1,104,383 1,130,173 1,130,583 2.3% 0.0%
Total 4,717,300 5,717,114 6,160,278 6,231,291 7.8% 1.2%
_________________________________
City of Mercer Island 2011-2012 Budget G-97
Department Function:
Stormwater Utility Services
Description
Provide business administration services and operational support to the City's stormwater utility.
Provide the full range of maintenance activities and operational expertise required for reliable 24-hour
services from the City's stormwater utility. Ensure compliance with all state and federal rules and
regulations for public utilities.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Monitor stormwater quality.
• Ensure compliance with federal and state regulations.
• Convey drainage through natural and piped system to Lake Washington safely and with minimal
impact to the Lake.
2011-2012 Key Initiatives
• Reach full compliance with new NPDES stormwater regulations.
• Identify opportunities to demonstrate low impact development techniques.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 181,686 197,433 183,929 192,414 -6.8% 4.6%
Benefits 59,828 62,745 59,834 66,515 -4.6% 11.2%
Supplies 51,326 20,600 20,600 20,600 0.0% 0.0%
Contractual Services 202,993 361,130 276,134 277,634 -23.5% 0.5%
Fleet/Computer/Equipment Rental 40,587 42,956 45,465 45,465 5.8% 0.0%
Insurance 50,000 55,000 48,074 51,889 -12.6% 7.9%
Utilities 20,365 28,600 28,000 28,000 -2.1% 0.0%
Other Services & Charges 23,272 24,500 18,484 18,764 -24.6% 1.5%
Intergovernmental Services 10,208 11,100 12,000 13,000 8.1% 8.3%
General Administration Support 55,600 59,000 39,279 40,976 -33.4% 4.3%
Total 695,866 863,064 731,799 755,257 -15.2% 3.2%
_________________________________
G-98 City of Mercer Island 2011-2012 Budget
Department Function:
Solid Waste Services
Description
Contract with Allied Waste for curbside disposal and recycling services. Provide disposal options for
hard-to-recycle items, ranging from home electronics and appliances to motor oil and tires.
Priority of Government
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Hold two special collection events annually for hard to recycle items.
2011-2012 Key Initiatives
• Implement enhanced service provisions in new long-term contract with Allied Waste.
• Expand the menu of items accepted at Recycling Events held twice a year.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 381 700 500 500 -28.6% 0.0%
Benefits 61 50 - - -100.0% N/A
Supplies 1,080 - 1,000 1,000 N/A 0.0%
Contractual Services 43,944 50,000 49,400 49,400 -1.2% 0.0%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges - - - - N/A N/A
Intergovernmental Services - - - - N/A N/A
Total 45,466 50,750 50,900 50,900 0.3% 0.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-99
Department Function:
Facilities Services
Description
Provide preventative and corrective maintenance to all City buildings through a combination of
contracted services and one City staff member.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Coordinate scheduled preventative building maintenance.
• Respond to building maintenance requests.
• Manage grounds maintenance contracts.
• Prepare capital improvement plan and oversee facilities CIP projects.
2011-2012 Key Initiatives
• Complete work design analysis for Facilities Project Coordinator.
• Begin life-cycle analysis for key City facilities.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 55,369 80,944 48,614 31,267 -39.9% -35.7%
Benefits 21,021 29,843 17,216 12,881 -42.3% -25.2%
Supplies 15,061 17,500 17,500 17,500 0.0% 0.0%
Contractual Services 148,595 186,500 183,500 183,500 -1.6% 0.0%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental 7,740 8,740 7,210 7,210 -17.5% 0.0%
Utilities 192,573 178,497 186,372 208,806 4.4% 12.0%
Other Services & Charges 1,317 1,950 300 300 -84.6% 0.0%
Total 441,677 503,974 460,712 461,464 -8.6% 0.2%
_________________________________
G-100 City of Mercer Island 2011-2012 Budget
Department Function:
Fleet Services
Description
Provide preventative maintenance and repairs for more than 150 vehicles and pieces of heavy equipment
through a combination of contracted services and one City staff member.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Coordinate fleet acquisitions and replacements.
• Perform, or contract out, repairs to vehicles and equipment.
• Conduct emissions testing.
• Purchase fuel for fleet.
2011-2012 Key Initiatives
• Maintain Evergreen Fleets “Platinum” certification, encompassing a review of the entire fleet in
terms of vehicle utilization, right sizing, fuel efficiency, and carbon emission reduction opportunities.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 67,109 82,598 82,088 83,208 -0.6% 1.4%
Benefits 26,258 29,730 28,240 31,389 -5.0% 11.2%
Supplies 233,233 260,500 260,500 268,500 0.0% 3.1%
Contractual Services 75,693 104,000 83,000 86,000 -20.2% 3.6%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental 6,626 6,749 4,199 4,199 -37.8% 0.0%
Insurance 22,560 26,000 26,000 26,000 0.0% 0.0%
Other Services & Charges 490 1,200 1,200 1,200 0.0% 0.0%
Total 431,968 510,777 485,227 500,496 -5.0% 3.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-101
Department Function:
Customer Field Response Services
Description
Provide a quick and efficient response to a variety of customer requests involving City utilities and the
public right-of-way.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
Services & Products
• Repair water leaks.
• Locate underground utilities.
• Replace water meters.
• Control vegetation overgrowth.
• Patch potholes.
• Assess sewer problems.
• Perform right-of-way inspections
• Clear roadway hazards.
2011-2012 Key Initiatives
• Maintain current service levels.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 127,257 141,296 136,904 138,728 -3.1% 1.3%
Benefits 45,351 50,132 47,704 53,000 -4.8% 11.1%
Supplies 51 1,200 400 400 -66.7% 0.0%
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental 15,212 15,212 13,067 13,067 -14.1% 0.0%
Other Services & Charges 298 1,200 - - -100.0% N/A
Intergovernmental Services - - - - N/A N/A
Total 188,169 209,040 198,075 205,195 -5.2% 3.6%
_________________________________
G-102 City of Mercer Island 2011-2012 Budget
MUNICIPAL COURT
_________________________________
G-104 City of Mercer Island 2011-2012 Budget
Department:
Municipal Court
Description
The Mercer Island Municipal Court is responsible for processing all civil infractions (comprised mostly of
traffic and parking violations) and criminal citations/complaints filed by the City of Mercer Island and the
City of Newcastle, which contracts for court services with the City.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Civil & Criminal Case Processing 3.85 3.85 3.35 3.35 -13.0% 0.0%
Total Regular 3.85 3.85 3.35 3.35 -13.0% 0.0%
Contracted (Temporary):
Civil & Criminal Case Processing - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-105
Department:
Municipal Court
2011-2012 Resources
Court Fines & Forefeits
100%
2011-2012 Uses
Equipment Rental
4%
Other Services & Charges
Contractual Services 2%
4%
Supplies
1%
Benefits
22%
Salaries & Wages
66%
_________________________________
G-106 City of Mercer Island 2011-2012 Budget
Department:
Municipal Court
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Court Fines & Forefeits 390,425 370,000 394,000 394,000 6.5% 0.0%
General Purpose Revenue - 63,134 - - -100.0% N/A
Total Resources 390,425 433,134 394,000 394,000 -9.0% 0.0%
Uses:
Salaries & Wages 269,682 300,471 238,887 242,112 -20.5% 1.4%
Benefits 81,639 94,073 74,786 83,645 -20.5% 11.8%
Supplies 1,958 3,650 2,750 2,750 -24.7% 0.0%
Contractual Services 15,578 12,000 14,000 14,000 16.7% 0.0%
Communications 652 800 600 600 -25.0% 0.0%
Fleet/Computer/Equip Rental 14,077 13,765 17,150 17,150 24.6% 0.0%
Other Services & Charges 4,227 8,375 6,900 6,900 -17.6% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total Uses 387,813 433,134 355,073 367,157 -18.0% 3.4%
Note: The net excess resources in 2011 and 2012 will be used to fund other governmental services in
the General Fund.
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Civil & Criminal Case Processing 387,813 433,134 355,073 367,157 -18.0% 3.4%
Total 387,813 433,134 355,073 367,157 -18.0% 3.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-107
Department:
Municipal Court
2011-2012 Budget Analysis
General Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 433,134
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (31,318)
Travel, tuition & registrations (1,375)
Other operating costs 1,185
Interpreter services 3,000
Subtotal (28,508) -6.6%
2011 Base Budget 404,626 -6.6%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
Court Administrator (0.5 FTE reduction) (49,553)
Subtotal (49,553)
2011 Final Budget 355,073 -18.0%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 355,073
Plus 2012 General Inflationary Increases 12,084 3.4%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 367,157 3.4%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 367,157 3.4%
_________________________________
G-108 City of Mercer Island 2011-2012 Budget
Department Function:
Civil & Criminal Case Processing
Description
Adjudicate civil infractions and criminal cases; issue subpoenas and warrants; maintain case files; schedule
cases; assess and collect fines and forfeitures; conduct motions, evidentiary hearings, discovery matters,
bench and jury trials, and sentencing hearings.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Hold court hearings in a timely fashion as required by the Washington State Supreme Court.
• Adjudicate civil infractions and set hearing dates.
• Complete monthly reports to the Office of Administrator of the Courts.
• Provide probation services to ensure compliance with judgments and sentencings.
• Collect court fines.
2011-2012 Key Initiatives
• Bring the infraction and probation collections up to date and maintain regular audit of cases for
timely collection actions.
• Continue to evaluate and improve customer service.
• Attend training and continuing education classes to remain current on Court rules, regulations and
procedures.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 269,682 300,471 238,887 242,112 -20.5% 1.4%
Benefits 81,639 94,073 74,786 83,645 -20.5% 11.8%
Supplies 1,958 3,650 2,750 2,750 -24.7% 0.0%
Contractual Services 15,578 12,000 14,000 14,000 16.7% 0.0%
Communications 652 800 600 600 -25.0% 0.0%
Fleet/Computer/Equipment Rental 14,077 13,765 17,150 17,150 24.6% 0.0%
Other Services & Charges 4,227 8,375 6,900 6,900 -17.6% 0.0%
Total 387,813 433,134 355,073 367,157 -18.0% 3.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-109
_________________________________
G-110 City of Mercer Island 2011-2012 Budget
PARKS & RECREATION
DEPARTMENT
_________________________________
G-112 City of Mercer Island 2011-2012 Budget
Department:
Parks & Recreation
Description
The Parks & Recreation Department assumes a major role in developing a sense of community and
enhancing a patron’s quality of life by providing recreational and social programs to preschool age
children, youth, teen, adult, family, and senior populations and by organizing and hosting special events.
Partnerships with community agencies, businesses, and institutions are actively sought to ensure that
service needs are met. In terms of physical assets, the Parks & Recreation Department is responsible
for operating and maintaining the Community Center at Mercer View (CCMV), over 460 acres of parks
and open space, and more than 50 miles of trails. The Parks & Recreation Department is organized
around the following five functions: 1) Administration, 2) Community Center at Mercer View, 3) Parks
Maintenance, and 4) Recreation & Special Programs.
_________________________________
City of Mercer Island 2011-2012 Budget G-113
Department:
Parks & Recreation
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration 4.75 4.75 4.00 4.00 -15.8% 0.0%
Community Center 3.90 3.90 3.50 3.50 -10.3% 0.0%
Parks Maintenance 9.50 9.50 9.90 9.90 4.2% 0.0%
Recreation & Special Programs 4.35 4.35 5.10 5.10 17.2% 0.0%
Total Regular 22.50 22.50 22.50 22.50 0.0% 0.0%
Contracted (Temporary):
Administration 1.00 1.00 1.00 1.00 0.0% 0.0%
Community Center - 2.00 2.00 3.00 0.0% 50.0%
Parks Maintenance 0.30 0.30 - - -100.0% N/A
Recreation & Special Programs 0.70 0.70 - - -100.0% N/A
Total Contracted 2.00 4.00 3.00 4.00 -25.0% 33.3%
_________________________________
G-114 City of Mercer Island 2011-2012 Budget
Department:
Parks & Recreation
2011-2012 Resources
Field Rentals Boat Launch
B&O Tax 3% 1%
1%
Recreation & Special
Programs
13%
WSDOT I90 Support
10%
CCMV Rentals
General Purpose 9%
Revenue
59% CCMV Program Fees
3%
CCMV Long
Term Rentals
1%
Miscellaneous
1%
2011-2012 Uses
Other Intergovernmental
2% Services
Utilities 2%
8%
Capital
Equipment Rental 1%
7%
Communications Salaries & Wages
1% 47%
Contract Services
12%
Supplies
5%
Benefits
15%
_________________________________
City of Mercer Island 2011-2012 Budget G-115
Department:
Parks & Recreation
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance - 131,814 - - -100.0% N/A
Business and Occupation Tax 77,670 98,051 42,513 46,626 -56.6% 9.7%
1% for the Arts Fund - 10,600 40,600 10,000 283.0% -75.4%
Field and Park Facility Rentals 78,443 105,000 111,000 145,500 5.7% 31.1%
Boat Launch Ticket Sales 38,031 36,000 46,400 46,400 28.9% 0.0%
Recreation and Special Programs 603,293 573,379 585,950 580,450 2.2% -0.9%
WSDOT I90 Support 443,812 444,120 447,895 451,000 0.8% 0.7%
CCMV Facilities Rental Fees 382,976 305,200 402,466 432,166 31.9% 7.4%
CCMV Program and Fee Rev 66,386 113,100 106,680 106,680 -5.7% 0.0%
CCMV Long Term Rentals 27,804 27,911 31,048 35,848 11.2% 15.5%
Donations 8,156 17,000 34,953 34,737 105.6% -0.6%
Grants 4,500 14,500 - - -100.0% N/A
Miscellaneous 38,701 34,225 37,070 37,070 8.3% 0.0%
General Purpose Revenue 2,467,363 2,869,428 2,548,925 2,558,884 -11.2% 0.4%
Total Resources 4,237,135 4,780,328 4,435,500 4,485,361 -7.2% 1.1%
Uses:
Salaries & Wages 1,934,857 2,158,179 2,090,432 2,098,928 -3.1% 0.4%
Benefits 541,668 633,431 603,195 682,378 -4.8% 13.1%
Supplies 279,806 290,710 290,924 267,872 0.1% -7.9%
Contractual Services 701,553 752,044 586,179 552,668 -22.1% -5.7%
Communications 28,907 42,392 29,317 29,317 -30.8% 0.0%
Fleet/Computer/Equip Rental 264,353 273,747 290,074 289,324 6.0% -0.3%
Utilities 347,968 410,953 365,461 384,756 -11.1% 5.3%
Other Services & Charges 117,915 123,372 84,118 84,318 -31.8% 0.2%
Intergovernmental Services 20,108 65,500 64,800 64,800 -1.1% 0.0%
Capital - 30,000 31,000 31,000 3.3% 0.0%
Total Uses 4,237,135 4,780,328 4,435,500 4,485,361 -7.2% 1.1%
_________________________________
G-116 City of Mercer Island 2011-2012 Budget
Department:
Parks & Recreation
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration 696,509 791,744 659,655 676,056 -16.7% 2.5%
Community Center 688,926 802,823 865,383 898,886 7.8% 3.9%
Parks Maintenance 1,830,057 2,100,227 1,963,657 1,981,488 -6.5% 0.9%
Recreation & Special Programs 1,021,643 1,085,533 946,805 928,931 -12.8% -1.9%
Total 4,237,135 4,780,328 4,435,500 4,485,361 -7.2% 1.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-117
Department:
Parks & Recreation
2011-2012 Budget Analysis
General & 1% for the Arts Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 4,238,157
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- 1.0 FTE contract Recreation Coordinator (66,814)
- CCMV equipment, advertising and repairs (carryover) (35,000)
- Parks Maintenance equipment (carryover) (30,000)
Temporary Reduction Parks Manager (1.0 FTE) (95,985)
Staff assignment change (shift to I-90 Landscsaping) (77,808)
Recreation program instructors (26,572)
Printing, postage & advertising (19,866)
Travel, tuition & registrations (11,549)
Telephone, cellular phones and pagers (7,039)
Other operating costs 8,000
CCMV building maintenance 34,916
CCMV Casual to Contract staff conversions 39,253
Subtotal (288,464) -6.8%
2011 Base Budget 3,949,693 -6.8%
Plus 2011 Service Enhancement Requests:
Continue CCMV contract custodial services 32,100
Establish CCMV equipment sinking fund 31,000
Subtotal 63,100 1.5%
Less 2011 Service Reduction Proposals:
Reduce park maintenance level of service (B to C) (19,000)
Summer Celebration fireworks evening (24,500)
Groveland Beach lifeguards (24,200)
Subtotal (67,700)
2011 Final Budget 3,945,093 -6.9%
_________________________________
G-118 City of Mercer Island 2011-2012 Budget
Department:
Parks & Recreation
2011-2012 Budget Analysis
General & 1% for the Arts Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 3,945,093
Plus 2012 General Inflationary Increases 84,501 2.1%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 4,029,594 2.1%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
Reduce Recreation and Arts Events (41,858)
Subtotal (41,858)
2012 Final Budget 3,987,736 1.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-119
Department:
Parks & Recreation
2011-2012 Budget Analysis
Beautification Fund
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 542,171
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Convert mowing contract to internal labor (represents
net savings) (15,764)
Irrigation savings (34,472)
Other operating costs (1,527)
Subtotal (51,763) -9.5%
2011 Base Budget 490,408 -9.5%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 490,408 -9.5%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 490,408
Plus 2012 General Inflationary Increases 7,218 1.5%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 497,626 1.5%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 497,626 1.5%
_________________________________
G-120 City of Mercer Island 2011-2012 Budget
Department Function:
Administration
Description
Provide overall leadership to the department through strategic planning, budget preparation and
monitoring, and performance measurement, and oversee park planning, grant development, project
management, and citizen outreach efforts.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Provide scheduling services for City owned and selected School District ballfields and facilities.
• Coordinate volunteer recruitment, training, and retention efforts for social services, community
center programs, and park maintenance.
• Implement Park and Recreation Plan as well as other park master plans.
• Develop master plans for selected parks.
• Oversee CIP planning and project management efforts.
• Pursue grant funding opportunities in support of park projects and recreation services.
• Provide staff support to Ballfield User Group (BUG), Open Space Conservancy Trust, Senior
Commission, and Council Park and Recreation Subcommittee.
• Process, review, and grant special event and special use permits.
• Coordinate park planning in conjunction with private development proposals.
• Manage park property database (e.g. easements, encroachments, and leases).
• Coordinate logistical support for City sponsored and regional special events (e.g. July 4th, Summer
Celebration!, Seafair, Rotary Half Marathon, and Sockeye fishery).
• Solicit and account for donations in conjunction with Northwest Parks Foundation.
• Review and evaluate properties for potential acquisition.
• Coordinate department sponsorships and marketing activities.
2011-2012 Key Initiatives
• Implement results of the Ballfield Use Analysis and Policy Committee recommendations.
• Implement Park and Recreation Strategic Plan.
• Develop, review and update department policy manual.
• Provide department direction for improved efficiency measures.
• Implement Open Space Conservancy Trust Work Plan.
• Implement web-based feature allowing online viewing of facility schedules, availability, and use.
• Provide assistance to the Mercer Island Boys & Girls Club in developing a master facility scheduling
system for the new PEAK facility.
_________________________________
City of Mercer Island 2011-2012 Budget G-121
Department Function:
Administration
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 395,874 428,257 344,489 348,991 -19.6% 1.3%
Benefits 113,644 132,102 99,905 111,804 -24.4% 11.9%
Supplies 18,640 40,600 23,400 23,400 -42.4% 0.0%
Contractual Services 26,858 39,222 53,275 53,275 35.8% 0.0%
Communications 7,965 10,572 5,035 5,035 -52.4% 0.0%
Fleet/Computer/Equipment Rental 93,608 94,190 93,198 93,198 -1.1% 0.0%
Other Services & Charges 31,813 41,300 35,553 35,553 -13.9% 0.0%
Intergovernmental Services 8,108 5,500 4,800 4,800 -12.7% 0.0%
Capital - - - - N/A N/A
Total 696,509 791,744 659,655 676,056 -16.7% 2.5%
_________________________________
G-122 City of Mercer Island 2011-2012 Budget
Department Function:
Community Center
Description
Provide 7-day a week opportunities at the Community Center at Mercer View (CCMV) for drop-in and
programmed recreation activities as well as amenities for business meeting rentals and special events;
provide three leased spaces to two (2) childcare providers; and serve as one of the community’s
emergency shelters during disasters or prolonged utility outages.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Overall management of the CCMV facility and its general activities.
• Financial management of CCMV operating budget.
• Provide 7-day per week staffing needs for 106 operating hours of the facility.
• Provide all on-site customer service needs for the general public including in-person reception,
telephone reception, daily janitorial needs, rental check-in and check-out, fee calculations and
collections, monitor general activities of the public, and enforce code of conduct.
• Primary registration source for all department programs offered to patrons.
• Host a majority of recreational programs offered by Department.
• Primary reception desk for Parks and Recreation Department.
• General administrative support of the entire Parks & Recreation Department.
• Management of long term tenant leases and facility-based maintenance needs of Annex.
• CCMV staff supports department programs and special events.
• Act as an informational hub and clearinghouse for the City as a whole.
• Manage CCMV website content.
• Provide venue for large community wide events (Rotary Run, Leap for Green, and Summer
Celebration.)
• Perform all marketing and advertising efforts for the room rentals and drop-in programs including
advertisement within various publications, on-line advertising and promotion, and website
promotion.
• Book all room and gymnasium rentals at CCMV, including site tours.
• Perform set-up and take-down of room rentals.
• Assist Recreation Instructors with room usage, AV/Media use, and other administrative needs.
• Encompass environmental stewardship within daily activities and decisions.
• Coordinate with Mercer Island Art Gallery to host up to six separate hangings per year, with CCMV
selling the corresponding artwork for the Arts Council.
• Provide specialized spaces for preschool youth, seniors, fitness, dance, games, and art activities.
• Manage approximately 8,550 hours of drop in sports activities for 8 drop-in programs.
• Issue annual boat launch permits, and collect pea patch fees.
• Serve as a public library extension.
• Insure that CCMV is prepared to act as Emergency Shelter.
_________________________________
City of Mercer Island 2011-2012 Budget G-123
Department Function:
Community Center
2011-2012 Key Initiatives
• Achieve (not to exceed) authorized subsidy level, and come in at or under approved expenditure
limits.
• Continue to review and analyze current rental occupancy and rates to maximize usage and rental
revenue.
• Continue to maintain a high level of service.
• Continue to develop, review and update policies.
• Proactively address risk management issues.
• Ensure the preservation of the CCMV facility to prolong its useful life.
• Review and update gym usage policies versus actual usage of gymnasium to ensure consistency with
departmental policies.
• Continue to develop/update/implement business strategies and a corresponding marketing plan to
minimize the financial burden on the City.
• Continue to strive to become even more efficient in overall operations and management of facility.
• Continue to support and serve as a venue for high profile community events.
• Keep Mercer Island Residents & Businesses at the forefront of decision making process.
• Ensure emergency preparedness of the CCMV.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 322,512 408,557 422,955 426,819 3.5% 0.9%
Benefits 80,348 97,811 125,691 156,409 28.5% 24.4%
Supplies 76,221 48,500 46,500 44,028 -4.1% -5.3%
Contractual Services 100,495 93,250 117,528 115,963 26.0% -1.3%
Communications 3,030 5,690 5,350 5,350 -6.0% 0.0%
Fleet/Computer/Equipment Rental 16,754 18,765 19,167 19,167 2.1% 0.0%
Utilities 76,065 90,750 79,742 82,700 -12.1% 3.7%
Other Services & Charges 13,501 39,500 17,450 17,450 -55.8% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital - - 31,000 31,000 N/A 0.0%
Total 688,926 802,823 865,383 898,886 7.8% 3.9%
_________________________________
G-124 City of Mercer Island 2011-2012 Budget
Department Function:
Parks Maintenance
Description
Maintain high demand, multi-use athletic fields, playgrounds, sport courts, swimming beaches, street-end
waterfront access areas, hiking, biking and equestrian trails, open spaces areas, and picnic facilities.
Provide arboricultural planning, project management, and consultation services for tree and urban
forests in public open spaces and parks. Maintain and repair public art installations.
Priority of Government
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Provide customer service response to citizen generated park maintenance issues.
• Maintain 460 acres of parks and open space, over 50 miles of trails, 20 street-end parks, 14 multi-
use athletic fields, 12 playgrounds, 2 guarded swim beaches, 2 off-leash areas, 4 picnic facilities, and 1
boat launch.
• Coordinate ballfield maintenance program with Ballfield User Group.
• Manage facility, park, open space, and trail capital projects.
• Support over 3,800 field use reservations and 550 field preps annually.
• Support volunteer and neighborhood park stewardship projects.
• Support recreation programs with logistical support and park preparations.
• Support CCMV operations with logistical support and grounds maintenance services.
• Support citywide and regional special events, including July 4th, Summer Celebration!, Seafair,
Sockeye fishery, triathlons, and half marathons.
• Provide maintenance support to 10 Lakes to Locks Water Trailheads.
• Manage landscape maintenance contracts for City Hall, Fire Stations, CCMV, and the Thrift Shop.
• Develop and implement forest management and open space vegetation plans.
• Plan and conduct forest stewardship training for citizen volunteers.
• Coordinate volunteer work projects in parks and open spaces.
• Conduct property surveys and identify encroachments.
• Provide staff support to the Open Space Conservancy Trust.
• Conduct hazardous tree inspections and coordinate their removal.
• Develop planting plans and recommend replacement plantings.
• Coordinate public art maintenance management plan with contracted service provider.
• Support Parks Department Capital Projects.
• Conduct routine inspections of playgrounds and athletic facilities.
_________________________________
City of Mercer Island 2011-2012 Budget G-125
Department Function:
Parks Maintenance
2011-2012 Key Initiatives
• Continue implementation of Park and Recreation Strategic Plan.
• Implement park master plans.
• Implement Open Space Vegetation Plan.
• Implement Pioneer Park Forest Management Plan.
• Implement Open Space Conservancy Trust Work Plan.
• Continue to develop and implement sustainable best management practices.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 802,158 879,116 930,800 932,910 5.9% 0.2%
Benefits 234,799 278,850 268,022 292,807 -3.9% 9.2%
Supplies 141,413 156,035 177,775 157,275 13.9% -11.5%
Contractual Services 232,714 235,447 82,682 78,831 -64.9% -4.7%
Communications 12,335 17,327 13,900 13,900 -19.8% 0.0%
Fleet/Computer/Equipment Rental 115,847 117,839 141,624 140,874 20.2% -0.5%
Utilities 271,903 320,203 285,719 302,056 -10.8% 5.7%
Other Services & Charges 6,888 5,410 3,135 2,835 -42.1% -9.6%
Intergovernmental Services 12,000 60,000 60,000 60,000 0.0% 0.0%
Capital - 30,000 - - -100.0% N/A
Total 1,830,057 2,100,227 1,963,657 1,981,488 -6.5% 0.9%
_________________________________
G-126 City of Mercer Island 2011-2012 Budget
Department Function:
Recreation & Special Programs
Description
Plan, develop, promote, organize, and schedule all City sponsored recreation and special programs,
which include athletics, health and fitness, aquatics, social services, senior services, cultural arts, outdoor
recreation, and special interest classes for all skill levels and for families, preschoolers, youth, teens,
adults, and seniors. In addition, the recreation function provides the community a number of special
events for all ages to include: performing arts and literacy events, carnival, pet events, trail events, and
the Summer Celebration festival.
Priority of Government
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Coordinate recreation service delivery with other agencies/organizations, including Boys and Girls
Club, Jewish Community Center, Northwest Center (Mary Wayte Pool), Youth Theatre Northwest,
Mercer Island Preschool Association, service clubs, Island Vision, Mercer Island Library, and the
Mercer Island School District.
• Provide Lifeguards at Luther Burbank swimming beaches.
• Provide staff support to Mercer Island Arts Council.
• Negotiate, develop, and maintain service contracts with contract instructors and partner agencies.
• Maintain recreation program database and online registration system.
• Coordinate www.myparksandrecreation.com efforts with 8 other cities.
• Provide a variety of events to the community.
• Develop promotional materials, including flyers, quarterly recreational guide, newspaper ads, and
newsletters.
• Coordinate with artists to maintain indoor and outdoor gallery spaces.
2011-2012 Key Initiatives
• Build and develop Playful City U.S.A. community outreach, adventure playground and outdoor play
awareness and implement revenues to support sustainability.
• Research creative alternative revenue resources including sponsorships and donations.
• Build health, wellness and sustainable awareness through programming.
• Continue to support high profile community events for the City and partner organizations.
• Develop and implement marketing strategies to increase recreational participants.
• Build cultural competency awareness at events.
_________________________________
City of Mercer Island 2011-2012 Budget G-127
Department Function:
Recreation & Special Programs
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 414,313 442,249 392,188 390,208 -11.3% -0.5%
Benefits 112,877 124,668 109,577 121,358 -12.1% 10.8%
Supplies 43,532 45,575 43,249 43,169 -5.1% -0.2%
Contractual Services 341,486 384,124 332,694 304,599 -13.4% -8.4%
Communications 5,578 8,803 5,032 5,032 -42.8% 0.0%
Fleet/Computer/Equipment Rental 38,145 42,953 36,085 36,085 -16.0% 0.0%
Other Services & Charges 65,713 37,162 27,980 28,480 -24.7% 1.8%
Capital - - - - N/A N/A
Total 1,021,643 1,085,533 946,805 928,931 -12.8% -1.9%
_________________________________
G-128 City of Mercer Island 2011-2012 Budget
POLICE DEPARTMENT
_________________________________
G-130 City of Mercer Island 2011-2012 Budget
Department:
Police
Description
The Police Department is organized around the following functions: 1) Administration, 2) Patrol, 3)
Marine Patrol, 4) Investigations & special programs, 5) Records, Property & Dispatch, 6) Special Teams,
7) Training, 8) Emergency Management, and 9) Jails.
_________________________________
City of Mercer Island 2011-2012 Budget G-131
Department:
Police
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration 4.00 4.00 4.00 4.00 0.0% 0.0%
Patrol 22.00 22.00 21.00 21.00 -4.5% 0.0%
Marine Patrol 2.00 2.00 2.00 2.00 0.0% 0.0%
Investigations & Special Programs 5.00 5.00 5.00 5.00 0.0% 0.0%
Records, Property & Dispatch 2.50 2.50 2.00 2.00 -20.0% 0.0%
Special Teams - - - - N/A N/A
Emergency Management 1.00 1.00 1.00 1.00 0.0% 0.0%
Training - - - - N/A N/A
Jails - - - - N/A N/A
Total Regular 36.50 36.50 35.00 35.00 -4.1% 0.0%
Contracted (Temporary):
Administration - - - - N/A N/A
Patrol - - - - N/A N/A
Marine Patrol - - - - N/A N/A
Investigations & Special Programs - - - - N/A N/A
Records, Property & Dispatch - - - - N/A N/A
Special Teams - - - - N/A N/A
Emergency Management - - - - N/A N/A
Training - - - - N/A N/A
Jails - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
G-132 City of Mercer Island 2011-2012 Budget
Department:
Police
2011-2012 Resources
Beginning Fund Balance Sales Tax
(Criminal Justice) (Criminal Justice)
1% 8% Vessel Registration Fees
2%
Marine Patrol Contract
1%
General Purpose Revenue
88%
2011-2012 Uses
Intergovernmental
Other Services Capital
1% 9% 0%
Equipment Rental
8%
Contract Services
1%
Supplies
2%
Salaries & Wages
60%
Benefits
19%
_________________________________
City of Mercer Island 2011-2012 Budget G-133
Department:
Police
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance (CJ) - 269,187 63,562 63,916 -76.4% 0.6%
Sales Tax (Criminal Justice) 479,813 453,160 465,750 483,750 2.8% 3.9%
Vessel Registration Fees 114,683 103,000 100,000 100,000 -2.9% 0.0%
Federal and Local Grants 91,725 9,999 - - -100.0% N/A
MI School District (SRO) 18,054 18,000 18,000 18,000 0.0% 0.0%
Marine Patrol Contract 146,419 138,420 60,000 62,000 -56.7% 3.3%
False Alarm Charges 5,050 3,500 3,500 3,500 0.0% 0.0%
Miscellaneous 222,715 4,500 3,600 3,600 -20.0% 0.0%
General Purpose Revenue 4,467,035 5,078,581 4,962,154 5,098,406 -2.3% 2.7%
Total Resources 5,545,494 6,078,347 5,676,566 5,833,172 -6.6% 2.8%
Uses:
Salaries & Wages 3,266,475 3,515,804 3,400,769 3,473,373 -3.3% 2.1%
Benefits 971,602 1,114,074 1,058,494 1,125,026 -5.0% 6.3%
Supplies 117,217 111,549 100,750 100,750 -9.7% 0.0%
Contractual Services 90,252 62,800 55,150 55,520 -12.2% 0.7%
Communications 23,741 27,400 27,400 27,400 0.0% 0.0%
Fleet/Computer/Equip Rental 445,305 447,478 447,134 447,134 -0.1% 0.0%
Other Services & Charges 56,621 82,000 67,680 68,680 -17.5% 1.5%
Intergovernmental Services 539,036 683,842 485,789 501,889 -29.0% 3.3%
Capital 35,245 33,400 33,400 33,400 0.0% 0.0%
Total Uses 5,545,494 6,078,347 5,676,566 5,833,172 -6.6% 2.8%
_________________________________
G-134 City of Mercer Island 2011-2012 Budget
Department:
Police
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration 814,971 855,308 856,184 872,927 0.1% 2.0%
Patrol 2,561,480 2,833,957 2,750,897 2,830,590 -2.9% 2.9%
Marine Patrol 491,943 466,397 424,491 434,056 -9.0% 2.3%
Investigations & Special Programs 621,572 669,980 641,924 664,994 -4.2% 3.6%
Records, Property & Dispatch 648,589 784,443 659,589 680,030 -15.9% 3.1%
Special Teams 35,705 40,700 40,700 40,700 0.0% 0.0%
Emergency Management 146,625 160,882 162,604 166,780 1.1% 2.6%
Training 68,760 92,680 85,192 85,400 -8.1% 0.2%
Jails 155,849 174,000 54,985 57,695 -68.4% 4.9%
Total 5,545,494 6,078,347 5,676,566 5,833,172 -6.6% 2.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-135
Department:
Police
2011-2012 Budget Analysis
General & Criminal Justice Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 6,078,347
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- ARRA vehicle grant (9,999)
Jail cost savings (Yakima & Issaquah contracts) (119,015)
NORCOM fees (80,151)
Salary & benefit savings (relative to 2010 budget) (59,035)
Marine Patrol program (39,174)
Travel, tuition & registrations (5,320)
Other operating costs 2,321
Patrol overtime (driven mostly by Hire Ahead reduction) 32,355
Subtotal (278,018) -4.6%
2011 Base Budget 5,800,329 -4.6%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
Hire Ahead Patrol Officer (1.0 FTE reduction) (85,506)
Police Records Clerk (0.5 FTE reduction) (38,257)
Subtotal (123,763)
2011 Final Budget 5,676,566 -6.6%
_________________________________
G-136 City of Mercer Island 2011-2012 Budget
Department:
Police
2011-2012 Budget Analysis
General & Criminal Justice Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 5,676,566
Plus 2012 General Inflationary Increases 156,606 2.8%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 5,833,172 2.8%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 5,833,172 2.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-137
Department Function:
Administration
Description
Oversee Police Services and Operations divisions and implement policies, procedures, and practices to
accomplish the department’s mission.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Prepare and monitor biennial budget.
• Develop departmental policies and procedures.
• Negotiate and administer two labor contracts.
• Manage dispatch services contract with NORCOM.
• Oversee department training and records maintenance.
• Maintain department accreditation.
• Provide staff resources to Public Safety Committee.
• Provide public information to the news media.
• Maintain personnel files.
2011-2012 Key Initiatives
• Continue to monitor dispatch service with NORCOM.
• Maintain Policy and Procedures manual with bi-annual updates.
• Continue development of strategic plan.
• Negotiate three year contracts for both bargaining units.
• Develop comprehensive Public Disclosure policy and procedures.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 535,398 552,747 542,715 549,763 -1.8% 1.3%
Benefits 129,972 141,220 136,526 146,221 -3.3% 7.1%
Supplies 7,240 12,899 3,500 3,500 -72.9% 0.0%
Contractual Services 1,927 1,700 1,700 1,700 0.0% 0.0%
Communications 12,402 12,700 12,700 12,700 0.0% 0.0%
Fleet/Computer/Equipment Rental 95,142 95,142 120,143 120,143 26.3% 0.0%
Other Services & Charges 6,692 9,900 9,900 9,900 0.0% 0.0%
Capital 26,199 29,000 29,000 29,000 0.0% 0.0%
Total 814,971 855,308 856,184 872,927 0.1% 2.0%
_________________________________
G-138 City of Mercer Island 2011-2012 Budget
Department Function:
Patrol
Description
Protect life and property, enforce laws and ordinances, investigate crimes, and maintain civil order.
Priority of Government
#1 The community will be safe.
Services & Products
• Conduct initial investigation of crimes, collisions, and other citizen complaints.
• Protect life and property through crisis intervention.
• Promote crime prevention.
• Apprehend/arrest criminals.
• Enforce traffic laws.
• Transport prisoners.
• Enforce leash laws.
• Establish community connections through outreach efforts.
• Provide additional security for private citizens and organizations.
• Provide field training for new recruits.
2011-2012 Key Initiatives
• Reduce the impact of crime through proactive enforcement and community outreach.
• Continue to thoroughly process crime scenes.
• Further utilize Records Management System data sources for crime analysis tools.
• Continue to work with the Washington Traffic Safety Commission on traffic safety initiatives.
• Continue implementation of Sector electronic ticketing and accident reporting system.
• Continue to find ways to “harden” the community against terrorism.
• Focus on traffic/pedestrian safety – school zones and CBD.
• Utilize new Traffic Collision Data Software to further target traffic enforcement efforts.
• Work with City IGS Staff to further implement and refine online crime mapping.
• Continue to analyze growth patterns and calls for service in the Central Business District.
• Continue to work closely with other City staff and community groups on special event planning.
_________________________________
City of Mercer Island 2011-2012 Budget G-139
Department Function:
Patrol
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 1,815,635 2,004,472 1,963,896 2,006,818 -2.0% 2.2%
Benefits 571,118 661,278 626,514 663,285 -5.3% 5.9%
Supplies 14,591 8,350 8,350 8,350 0.0% 0.0%
Contractual Services 5,898 8,500 8,500 8,500 0.0% 0.0%
Fleet/Computer/Equipment Rental 150,557 150,557 142,837 142,837 -5.1% 0.0%
Other Services & Charges 733 800 800 800 0.0% 0.0%
Capital 2,947 - - - N/A N/A
Total 2,561,480 2,833,957 2,750,897 2,830,590 -2.9% 2.9%
_________________________________
G-140 City of Mercer Island 2011-2012 Budget
Department Function:
Marine Patrol
Description
Oversee police and EMS services on Lake Washington. Includes code/law enforcement, rescue, public
education, and public assistance.
Priority of Government
#1 The community will be safe.
Services & Products
• Investigate collisions/crimes relating to marine events.
• Provide uniformed presence on the lake.
• Develop/implement prevention programs on the water.
• Train all new/current boat operators.
• Provide search and rescue operations.
• Provide drowning prevention classes.
• Provide dignitary protection.
• Participate in taskforces.
• Offer boating safety classes.
• Provide special event coverage.
2011-2012 Key Initiatives
• Reduce boating collisions through proactive boating law enforcement and boater education.
• Further develop Marine Patrol city wide disaster response plans with Emergency Management.
• Continue to work with affiliated agencies to ensure a safe boating environment.
• Continue to work closely with our marine contract cities to ensure a high level of service to these
communities.
• Continue to participate in regional marine law enforcement programs and initiatives.
• Continue to provide water safety and boating education programs to the community.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 193,136 207,478 187,900 192,430 -9.4% 2.4%
Benefits 54,965 60,539 57,464 61,129 -5.1% 6.4%
Supplies 13,252 13,100 11,700 11,700 -10.7% 0.0%
Contractual Services 63,093 8,800 9,150 9,520 4.0% 4.0%
Fleet/Computer/Equipment Rental 143,730 144,730 135,527 135,527 -6.4% 0.0%
Other Services & Charges 23,766 31,750 22,750 23,750 -28.3% 4.4%
Total 491,943 466,397 424,491 434,056 -9.0% 2.3%
_________________________________
City of Mercer Island 2011-2012 Budget G-141
Department Function:
Investigations & Special Programs
Description
Investigate criminal acts, complete case filings, forward charges against offenders, and work with other
agencies to solve crimes. Provide special programs to Mercer Island schools relating to drug and alcohol
abuse and bullying prevention.
Priority of Government
#1 The community will be safe.
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Investigate of misdemeanor and felony crimes.
• Interview and interrogate victims, witnesses, and suspects.
• Process crime scenes for evidence.
• Engage in stake out/surveillance.
• Prepare and execute search warrants.
• Prepare case filings.
• Provide court testimony.
• Provide sex offender monitoring and tracking.
• Monitor pawn shop activities.
• Participate in task forces.
• Provide uniformed presence within Mercer Island schools.
• Serve as liaison between the Police Department, the Mercer Island School District, the Youth and
Family Services Department, and the Juvenile Justice System.
• Develop/implement prevention programs in the schools.
• Provide classroom presentations relating to dating violence prevention in the high school.
• Provide specialized crime prevention classes for the business community.
• Provide personal safety classes for community residents.
• Participate in fund raising drives.
• Participate in community events.
2011-2012 Key Initiatives
• Continue to vigorously pursue criminals who victimize Island residents.
• Continue to participate in Eastside Narcotics Taskforce (ENTF).
• Continue to participate in Coalition of Small Police Agencies (CSPA) Major Crimes Taskforce.
• Develop training curriculum for Patrol Officers relating to new case law(s).
• Continue to work closely with the Mercer Island School District in addressing drug/alcohol issues.
• Focus on prevention of crime against children.
• Focus on juvenile delinquency issues.
• Work closely with school counselors in addressing adolescent issues.
_________________________________
G-142 City of Mercer Island 2011-2012 Budget
Department Function:
Investigations & Special Programs
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 451,560 478,034 459,169 472,771 -3.9% 3.0%
Benefits 130,429 150,654 145,648 155,116 -3.3% 6.5%
Supplies 5,412 4,200 4,200 4,200 0.0% 0.0%
Contractual Services 1,509 2,000 2,000 2,000 0.0% 0.0%
Communications 601 - - - N/A N/A
Fleet/Computer/Equipment Rental 26,392 26,392 22,207 22,207 -15.9% 0.0%
Other Services & Charges 5,669 8,700 8,700 8,700 0.0% 0.0%
Intergovernmental Services - - - - N/A N/A
Total 621,572 669,980 641,924 664,994 -4.2% 3.6%
_________________________________
City of Mercer Island 2011-2012 Budget G-143
Department Function:
Emergency Management
Description
Develop and maintain all documentation and programs necessary to meet the City’s responsibilities for
disaster preparedness.
Priority of Government
#1 The community will be safe.
Services & Products
• Continuously update Comprehensive Emergency Management Plan (CEMP) and Hazard
Identification Vulnerability Analysis (HIVA) documents and other associated response plans.
• Manage the City’s Emergency Operations Center (EOC) and supporting resources.
• Participate in King County Zone 1 coordination center activities.
• Manage new Emergency Response Teams.
• Provide disaster preparedness classes and information to City staff, residents, volunteers, and
community groups.
• Stay current on disaster related issues and steps that can be taken to prepare for a potential
disaster.
2011-2012 Key Initiatives
• Assist the business community in developing business continuity plans.
• Strengthen ability to respond to citywide emergencies with new Emergency Response Teams.
• Improve communications network for EOC operations.
• Identify and implement new incident tracking and resource tracking system.
• Continue to identify available resources local and national levels.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 89,505 89,743 92,357 94,582 2.9% 2.4%
Benefits 25,827 30,305 29,679 31,500 -2.1% 6.1%
Supplies 24,371 26,000 26,000 26,000 0.0% 0.0%
Contractual Services 327 5,000 2,000 2,000 -60.0% 0.0%
Fleet/Computer/Equipment Rental 3,334 3,334 5,943 5,943 78.3% 0.0%
Other Services & Charges 250 4,000 4,000 4,000 0.0% 0.0%
Intergovernmental Services 3,012 2,500 2,625 2,755 5.0% 5.0%
Total 146,625 160,882 162,604 166,780 1.1% 2.6%
_________________________________
G-144 City of Mercer Island 2011-2012 Budget
Department Function:
Records, Property & Dispatch
Description
Provide initial police contact to the public; maintain records; manage confiscated property and evidence;
and contract for police dispatch services with City of Kirkland and NORCOM (beginning 7/01/09).
Priority of Government
#1 The community will be safe.
Services & Products
• Address public needs at service window.
• Prepare correspondence to other criminal justice agencies.
• Take fingerprints for permits/licenses.
• Respond to patrol officer, detective, and public record requests.
• Record, store, maintain, and dispose of property and evidence.
• Prepare concealed weapons permits.
• Draft crime prevention materials.
• Compile statistics.
• Manage alarm system database.
• Coordinate AFIS program.
2011-2012 Key Initiatives
• Continue education relating to public disclosure requests.
• Plan for NIBRS/WIBRS reporting in place of UCR reporting.
• Continue education relating to RMS statistic retrieval.
• Continue involvement with King County AFIS staff and with regional RAIN and LYNX systems.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 153,120 147,330 121,220 123,289 -17.7% 1.7%
Benefits 55,655 53,598 45,863 50,975 -14.4% 11.1%
Supplies 18,217 7,500 7,500 7,500 0.0% 0.0%
Contractual Services 2,229 22,500 17,500 17,500 -22.2% 0.0%
Communications 10,738 14,700 14,700 14,700 0.0% 0.0%
Fleet/Computer/Equipment Rental 26,150 27,323 20,477 20,477 -25.1% 0.0%
Other Services & Charges 2,305 4,150 4,150 4,150 0.0% 0.0%
Intergovernmental Services 380,176 507,342 428,179 441,439 -15.6% 3.1%
Total 648,589 784,443 659,589 680,030 -15.9% 3.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-145
Department Function:
Special Teams
Description
Include Dive Team rescues and recoveries, Special Operations Team high-risk details, and Bike Team
traffic control and public relations.
Priority of Government
#1 The community will be safe.
Services & Products
Dive Team
• Perform drowning rescue and recoveries.
• Process underwater crime scenes.
• Participate in regional anti-terrorism detection.
• Protect dignitaries.
Special Operations Team
• Execute high-risk search warrants.
• Contain crime scenes.
• Provide training to Patrol Officers (Active Shooter responses).
• Protect Dignitaries.
• Asses risk of high value targets.
• Support ENTF search warrant executions.
Bike Patrol
• Enforce traffic laws with an emphasis on the Town Center.
• Provide bicycle safety classes.
• Patrol Parks.
• Engage in community oriented policing.
• Provide uniformed presence at community special events.
2011-2012 Key Initiatives
• Continue proactive educational campaigns relating to drowning prevention and water safety.
• Secure the necessary equipment for all special team functions.
• Continue to engage in mutual training dives with other area dive teams.
• Certify all divers at the NOAA Working Diver level.
• Continue joint training with the Bellevue Police SWAT Team.
• Provide enhanced tactical training to Patrol officers.
• Review, revise and continue school/public facility safety pre-planning and mapping.
• Continue to provide bike safety programs to the school district and community.
• Focus bike patrols in CBD/Park areas and continue to support city special events.
_________________________________
G-146 City of Mercer Island 2011-2012 Budget
Department Function:
Special Teams
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages - - - - N/A N/A
Benefits - 2,800 2,800 2,800 0.0% 0.0%
Supplies 16,516 19,000 19,000 19,000 0.0% 0.0%
Contractual Services 9,251 8,800 8,800 8,800 0.0% 0.0%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges 3,838 5,700 5,700 5,700 0.0% 0.0%
Intergovernmental Services - - - - N/A N/A
Capital 6,100 4,400 4,400 4,400 0.0% 0.0%
Total 35,705 40,700 40,700 40,700 0.0% 0.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-147
Department Function:
Training
Description
Provide full compliment of training for Police personnel.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Firearms proficiency/qualification
• First aid/CPR
• Blood borne pathogens
• Less than lethal force
• Defensive tactics
• NIMS
• BAC/DUI
• Interrogation skills
• Supervision skills
• Anti-harassment
• Personnel/labor law
• Officer development
• In-service roll call training
2011-2012 Key Initiatives
• Ensure all officers meet mandatory training requirements.
• Continue to provide a highly trained compliment of officers for this community.
• Ensure compliance with career level certification.
• Recruit top available police candidates.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 28,121 36,000 33,512 33,720 -6.9% 0.6%
Benefits 3,636 13,680 14,000 14,000 2.3% 0.0%
Supplies 17,618 20,500 20,500 20,500 0.0% 0.0%
Contractual Services 6,018 5,500 5,500 5,500 0.0% 0.0%
Other Services & Charges 13,368 17,000 11,680 11,680 -31.3% 0.0%
Total 68,760 92,680 85,192 85,400 -8.1% 0.2%
_________________________________
G-148 City of Mercer Island 2011-2012 Budget
Department Function:
Jails
Description
Manage contracted jail services with City of Renton, City of Issaquah, King County and Yakima County.
Priority of Government
#1 The community will be safe.
Services & Products
• Oversee inmate location.
• Oversee/coordinate prisoner transports.
• Oversee jail billing.
2011-2012 Key Initiatives
• Do not renew Yakima Jail contract, which has a daily commitment of 4 beds.
• Reduce daily bed commitment at Issaquah Jail from 2 beds to 1 bed.
• Continue to monitor jail contracts, seeking efficiencies whenever possible.
• Participate in regional jail administration and operations committees.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages - - - - N/A N/A
Benefits - - - - N/A N/A
Supplies - - - N/A N/A
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges - - - - N/A N/A
Intergovernmental Services 155,849 174,000 54,985 57,695 -68.4% 4.9%
Capital - - - - N/A N/A
Total 155,849 174,000 54,985 57,695 -68.4% 4.9%
_________________________________
City of Mercer Island 2011-2012 Budget G-149
_________________________________
G-150 City of Mercer Island 2011-2012 Budget
YOUTH & FAMILY SERVICES
DEPARTMENT
_________________________________
G-152 City of Mercer Island 2011-2012 Budget
Department:
Youth & Family Services
Description
The Youth & Family Services (YFS) Department provides a wide range of human and community
services for Mercer Island residents. These services include programs that offer counseling and
intervention; youth development, prevention of risk behaviors and family assistance; and community
education, advocacy, and planning. YFS is organized around the following functions: 1) Administrative
Services, 2) Professional Services, and 3) Thrift Shop.
_________________________________
City of Mercer Island 2011-2012 Budget G-153
Department:
Youth & Family Services
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Administration 3.50 3.50 3.00 3.00 -14.3% 0.0%
Professional Services 11.00 11.00 10.50 10.50 -4.5% 0.0%
Thrift Shop 1.00 1.00 1.00 1.00 0.0% 0.0%
Total Regular 15.50 15.50 14.50 14.50 -6.5% 0.0%
Contracted (Temporary):
Administration - - - - N/A N/A
Professional Services 1.00 1.00 1.00 1.00 0.0% 0.0%
Thrift Shop 2.00 2.00 2.00 2.00 0.0% 0.0%
Total Contracted 3.00 3.00 3.00 3.00 0.0% 0.0%
_________________________________
G-154 City of Mercer Island 2011-2012 Budget
Department:
Youth & Family Services
2011-2012 Resources
Begin Fund Balance
General Fund Support Federal, State & Local
7%
17% Grants
6%
MIYFS Foundation
Support MI School District
9% (Shared Cost)
3%
Donations
2%
YFS Fees
5%
Thrift Shop Sales
51%
2011-2012 Uses
Utilities Other Services
Equipment Rental
1% & Charges
5%
3%
Contract Services Interfund Transfers
4% 1%
Supplies
3%
Benefits Salaries & Wages
21% 62%
_________________________________
City of Mercer Island 2011-2012 Budget G-155
Department:
Youth & Family Services
Resources & Uses Summary
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance 136,009 254,443 103,414 150,316 -59.4% 45.4%
Sales Tax (Criminal Justice) 10,000 10,000 10,000 10,000 0.0% 0.0%
Federal, State & Local Grants 138,990 114,438 115,403 114,194 0.8% -1.0%
MI School District (Shared Cost) 24,000 60,000 60,000 60,000 0.0% 0.0%
Thrift Shop Sales 727,136 815,000 949,000 995,000 16.4% 4.8%
YFS Fees 86,309 87,650 90,000 90,000 2.7% 0.0%
Interest Earnings 3,291 3,000 3,500 3,500 16.7% 0.0%
Donations 39,922 42,183 32,500 32,500 -23.0% 0.0%
Youth Svcs Endowment Support 3,291 3,000 3,500 3,500 16.7% 0.0%
MIYFS Foundation Support 193,900 150,000 183,500 157,500 22.3% -14.2%
General Fund Support 519,338 521,507 320,000 320,000 -38.6% 0.0%
Total Resources 1,882,185 2,061,221 1,870,817 1,936,510 -9.2% 3.5%
Uses:
Salaries & Wages 1,157,284 1,282,943 1,171,481 1,186,214 -8.7% 1.3%
Benefits 365,787 416,255 377,744 419,899 -9.3% 11.2%
Supplies 48,742 65,722 57,950 57,950 -11.8% 0.0%
Contractual Services 76,447 68,900 76,300 76,800 10.7% 0.7%
Communications 3,105 4,650 4,025 4,025 -13.4% 0.0%
Fleet/Computer/Equip Rental 84,939 86,198 89,217 89,217 3.5% 0.0%
Utilities 11,455 10,900 11,500 12,005 5.5% 4.4%
Other Services & Charges 60,113 54,653 55,100 54,900 0.8% -0.4%
Intergovernmental Services 10,000 10,000 10,000 10,000 0.0% 0.0%
Capital - - - - N/A N/A
Interfund Transfers 64,312 61,000 17,500 25,500 -71.3% 45.7%
Total Uses 1,882,185 2,061,221 1,870,817 1,936,510 -9.2% 3.5%
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Administration 449,497 497,164 453,771 465,436 -8.7% 2.6%
Professional Services 1,090,370 1,188,831 1,088,297 1,125,962 -8.5% 3.5%
Thrift Shop 342,318 375,226 328,749 345,112 -12.4% 5.0%
Total 1,882,185 2,061,221 1,870,817 1,936,510 -9.2% 3.5%
_________________________________
G-156 City of Mercer Island 2011-2012 Budget
Department:
Youth & Family Services
2011-2012 Budget Analysis
Youth & Family Services, Criminal Justice & Youth Services Endowment Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 2,061,221
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Salary & benefit savings (relative to 2010 budget) (69,469)
Thrift Shop annual capital reinvestment needs (44,000)
Other operating costs (9,935)
Travel, tuition & registrations (5,653)
Dues & subscriptions (3,500)
Thrift Shop contract services (merchant fees, armored car) 8,000
Emergency Assistance 8,500
Subtotal (116,057) -5.6%
2011 Base Budget 1,945,164 -5.6%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
Development Coordinator (0.5 FTE reduction) (41,901)
VOICE Coordinator (0.5 FTE reduction) (32,446)
Subtotal (74,347)
2011 Final Budget 1,870,817 -9.2%
_________________________________
City of Mercer Island 2011-2012 Budget G-157
Department:
Youth & Family Services
2011-2012 Budget Analysis
Youth & Family Services, Criminal Justice & Youth Services Endowment Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 1,870,817
Plus 2012 General Inflationary Increases 65,693 3.5%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 1,936,510 3.5%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 1,936,510 3.5%
_________________________________
G-158 City of Mercer Island 2011-2012 Budget
Department Function:
Administration
Description
Provide managerial direction, oversight and administrative support to YFS Department programs and
staff. Execute planning efforts to ensure service configuration reflects community needs and explore,
vet and execute options to increase revenues for community and human services.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Receive visitors and clients to Luther Burbank building.
• Hire, train, and supervise student interns.
• Monitor and maintain office functions for effectiveness and efficiency.
• Oversee function of the Mercer Island Thrift shop.
• Provide staff resources to Advisory Board.
• Manage Department Professional Services and Programs
• Evaluate service effectiveness and facilitate change processes.
• Develop programs and initiatives.
• Oversee volunteer and community service staff.
• Recruit, orient, and staff YFS Foundation Board
• Oversee the execution and development of fundraising endeavors
• Generate revenue options
2011-2012 Key Initiatives
• Facilitate community dialogues on social and human needs.
• Secure funding to meet current and emergent community needs.
• Mobilize and coalesce efforts to address significant social and community issues.
• Execute collaborative community fundraising.
_________________________________
City of Mercer Island 2011-2012 Budget G-159
Department Function:
Administration
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 250,245 281,508 253,331 256,752 -10.0% 1.4%
Benefits 77,055 86,608 71,773 80,217 -17.1% 11.8%
Supplies 14,605 19,000 16,750 16,750 -11.8% 0.0%
Contractual Services 6,015 4,700 9,300 9,300 97.9% 0.0%
Communications 1,039 2,450 1,800 1,800 -26.5% 0.0%
Fleet/Computer/Equipment Rental 84,939 86,198 89,217 89,217 3.5% 0.0%
Other Services & Charges 12,307 13,700 8,100 7,900 -40.9% -2.5%
Interfund Transfers 3,291 3,000 3,500 3,500 16.7% 0.0%
Total 449,497 497,164 453,771 465,436 -8.7% 2.6%
_________________________________
G-160 City of Mercer Island 2011-2012 Budget
Department Function:
Professional Services
Description
Provide a wide array of community-based and school based services to children, youth, couples,
individuals, families, and seniors on Mercer Island at the Luther Burbank Administration Building and
each of the island schools. Services include volunteer and leadership development opportunities for
Mercer Island youth; counseling and intervention services; financial, food, and other basic assistance to
low-income Mercer Island individuals and families in need; senior outreach; information, referral and
consultation services; community mobilization; employment assistance; and alcohol an drug prevention
and intervention
Priority of Government
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Manage Community Service program for middle and high school aged youth:
o Summer Volunteer Program (middle school aged youth)
o Volunteer Outreach In Communities Everywhere (high school aged youth)
• Oversee year-round calendar of youth volunteer and leadership opportunities.
• Maintain job boards for local employers (on-line and physical postings).
• Provide school-based and department-based counseling and consultation services.
• Provide human services information and referrals.
• Consult with parents and teachers.
• Organize/oversee school based counseling groups (e.g. for new students, for children who have lost
a loved one to cancer, for at-risk youth, and for social skills).
• Assist children and youth with conflict management.
• Oversee peer mediation and peer led programs. (Bridges and Natural Helpers for adolescents)
• Oversee anti-bullying curriculum.
• Provide senior outreach service, home visits, and conduct classes on aging and elder care issues.
• Provide trainings and consultations for city departments dealing effectively with difficult situations.
• Maintain provider network of Island therapists and counselors.
• Provide vocational/employment-related presentations and workshops.
• Mobilize community to reduce underage drinking and decrease youth risk behaviors.
• Oversee holiday sponsorships for low-income families.
• Provide limited financial assistance for basic needs including a food pantry.
2011-2012 Key Initiatives
• Execute Positive Community Norms Campaign to reduce underage drinking and substance abuse.
• Support and enhance child functioning to help children and youth take advantage of their school
experience.
• Support seniors in ways that enable them to maintain their independence and self determination.
• Support community health through linkages to services.
_________________________________
City of Mercer Island 2011-2012 Budget G-161
Department Function:
Professional Services
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 760,236 831,350 760,236 769,954 -8.6% 1.3%
Benefits 233,178 268,356 244,561 272,508 -8.9% 11.4%
Supplies 14,852 25,022 19,000 19,000 -24.1% 0.0%
Contractual Services 27,899 16,200 15,500 15,500 -4.3% 0.0%
Communications 436 500 500 500 0.0% 0.0%
Other Services & Charges 43,769 37,403 38,500 38,500 2.9% 0.0%
Intergovernmental Services 10,000 10,000 10,000 10,000 0.0% 0.0%
Total 1,090,370 1,188,831 1,088,297 1,125,962 -8.5% 3.5%
_________________________________
G-162 City of Mercer Island 2011-2012 Budget
Department Function:
Thrift Shop
Description
Provide a resource for re-use and recycling of community members' donations; provide opportunities
for volunteers of all ages; and generate funding for the department’s array of human services.
Priority of Government
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• Manage retail Thrift Shop operation, which is open to public four days per week.
• Conduct eBay auctions of high value/specialty donated items.
• Manage vehicle donation program.
• Maintain household goods and clothing recycle/donation center for MI residents.
• Provide volunteer opportunities for adults and youth.
• Provide internships and community services placements for youth and young adults.
2011-2012 Key Initiatives
• Maximize proceeds from donations through multiple strategies.
• Explore and Execute business and revenue generating endeavors.
• Maintain and expand volunteer recruitment efforts.
• Provide a revenue base for the Youth and Family Services Department.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 146,803 170,085 157,914 159,508 -7.2% 1.0%
Benefits 55,554 61,291 61,410 67,174 0.2% 9.4%
Supplies 19,284 21,700 22,200 22,200 2.3% 0.0%
Contractual Services 42,534 48,000 51,500 52,000 7.3% 1.0%
Communications 1,631 1,700 1,725 1,725 1.5% 0.0%
Utilities 11,455 10,900 11,500 12,005 5.5% 4.4%
Other Services & Charges 4,037 3,550 8,500 8,500 139.4% 0.0%
Interfund Transfers 61,021 58,000 14,000 22,000 -75.9% 57.1%
Total 342,318 375,226 328,749 345,112 -12.4% 5.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-163
_________________________________
G-164 City of Mercer Island 2011-2012 Budget
NON-DEPARTMENTAL
_________________________________
G-166 City of Mercer Island 2011-2012 Budget
Department:
Non-Departmental
Description
Non-Departmental consists of those functions that cannot be attributed to a specific department,
namely: 1) information technology, 2) geographic information systems, 3) mandatory intergovernmental
services, 4) voluntary intergovernmental services, and 5) other general government services.
Staffing Summary
Type of Employee 2009 2010 2011 2012 Percent Change
& Department Function Actual Estimate Budget Budget 10-11 11-12
Regular (Ongoing):
Information Technology 3.00 3.00 3.00 3.00 0.0% 0.0%
Geographic Information Systems 2.00 2.00 2.00 2.00 0.0% 0.0%
Mandatory Intergovt'l Services - - - - N/A N/A
Voluntary Intergovt'l Services - - - - N/A N/A
Other General Gov't Services - - - - N/A N/A
Total Regular 5.00 5.00 5.00 5.00 0.0% 0.0%
Contracted (Temporary):
Information Technology - - - - N/A N/A
Geographic Information Systems - - - - N/A N/A
Mandatory Intergovt'l Services - - - - N/A N/A
Voluntary Intergovt'l Services - - - - N/A N/A
Other General Gov't Services - - - - N/A N/A
Total Contracted - - - - N/A N/A
_________________________________
City of Mercer Island 2011-2012 Budget G-167
Department:
Non-Departmental
2011-2012 Resources
Beginning Fund B&O Tax Fire Insurance
Balance 10% 3% Premium Tax
1%
Water Rates
1%
Sewer Rates
1%
Internal Charges
12%
General Purpose Revenue
71%
2011-2012 Uses
Salaries & Wages
Interfund Transfers 11%
27%
Benefits
21%
Intergovernmental
Services
8% Supplies
2%
Contract Services
Other 5%
1% Communications
2%
Equipment Rental
Insurance 2%
22%
_________________________________
G-168 City of Mercer Island 2011-2012 Budget
Department:
Non-Departmental
Resources & Uses Summary
2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Resources:
Beginning Fund Balance 329,405 621,849 233,885 515,161 -62.4% 120.3%
Business & Occupation Tax 100,000 100,000 125,000 125,000 25.0% 0.0%
Fire Insurance Premium Tax 23,871 25,418 25,000 25,000 -1.6% 0.0%
Street Fund 1,022 - - - N/A N/A
Water Rates 28,380 26,894 41,546 43,168 54.5% 3.9%
Sewer Rates 28,283 26,894 41,366 43,168 53.8% 4.4%
Stormwater Rates 35,483 26,901 18,465 19,185 -31.4% 3.9%
Internal Charges 397,077 445,575 422,495 434,260 -5.2% 2.8%
Interest Earnings 11,718 4,075 4,200 5,000 3.1% 19.0%
General Purpose Revenue 2,290,593 2,334,355 2,399,778 2,238,624 2.8% -6.7%
Total Resources 3,245,832 3,611,961 3,311,735 3,448,566 -8.3% 4.1%
Uses:
Salaries & Wages 332,642 404,612 384,994 404,863 -4.8% 5.2%
Benefits 627,552 705,312 727,476 801,126 3.1% 10.1%
Supplies 71,956 81,438 55,500 55,500 -31.8% 0.0%
Contractual Services 108,698 221,700 177,380 154,600 -20.0% -12.8%
Communications 64,428 79,660 76,000 76,000 -4.6% 0.0%
Fleet/Computer/Equip Rental 78,219 62,962 85,291 86,241 35.5% 1.1%
Insurance 610,409 664,743 787,274 844,319 18.4% 7.2%
Other Services & Charges 16,914 32,400 18,000 20,000 -44.4% 11.1%
Intergovernmental Services 231,271 316,854 281,483 284,980 -11.2% 1.2%
Capital - 6,000 - - -100.0% N/A
Interfund Transfers 1,103,743 1,036,280 718,337 720,937 -30.7% 0.4%
Total Uses 3,245,832 3,611,961 3,311,735 3,448,566 -8.3% 4.1%
_________________________________
City of Mercer Island 2011-2012 Budget G-169
Department:
Non-Departmental
Expenditure Summary by Function
Department 2009 2010 2011 2012 Percent Change
Function Actual Estimate Budget Budget 10-11 11-12
Information Technology 397,077 445,575 422,495 434,260 -5.2% 2.8%
Geographic Information Systems 186,253 216,837 219,539 226,926 1.2% 3.4%
Mandatory Intergovt'l Services 27,568 28,150 29,566 30,453 5.0% 3.0%
Voluntary Intergovt'l Services 189,616 270,704 230,117 232,027 -15.0% 0.8%
Other General Gov't Services 2,445,317 2,650,695 2,410,018 2,524,900 -9.1% 4.8%
Total 3,245,832 3,611,961 3,311,735 3,448,566 -8.3% 4.1%
_________________________________
G-170 City of Mercer Island 2011-2012 Budget
Department:
Non-Departmental
2011-2012 Budget Analysis
Information Technology (IT) & Geographic Information Systems (GIS)
General, Street, Utility & Computer Replacement Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 662,412
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Computer & network supplies (11,400)
Salary & benefit savings (relative to 2010 budget) (8,779)
Travel, tuition & registrations (6,000)
Other operating costs (999)
King County I-NET fees 6,800
Subtotal (20,378) -3.1%
2011 Base Budget 642,034 -3.1%
Plus 2011 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2011 Service Reduction Proposals:
None -
Subtotal -
2011 Final Budget 642,034 -3.1%
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 642,034
Plus 2012 General Inflationary Increases 19,152 3.0%
Plus (Less) 2012 Other Significant Changes:
None -
Subtotal - 0.0%
2012 Base Budget 661,186 3.0%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 661,186 3.0%
_________________________________
City of Mercer Island 2011-2012 Budget G-171
Department:
Non-Departmental
2011-2012 Budget Analysis
Intergovernmental Services & Other General Government Services
General, Self-Insurance, Beautification & Firemen’s Pension Funds
% Change
2011 Analysis Budget
2010-2011
2010 Approved Budget 2,949,549
Plus 2011 General Inflationary Increases - 0.0%
Plus (Less) 2011 Other Significant Changes:
Prior year one-time costs & carryovers:
- Temporary YFS School Counselor funding (81,507)
- ARCH Trust Fund contribution (45,078)
- EECBG grant equipment (electric bicycles, meters) (14,038)
General Fund contribution to YFS (105,000)
Interfund transfer to Technology CIP (100,000)
Computer Support Tech (move to IT rental rates) (73,986)
Community survey (conducted biennially) (25,000)
Travel, dues, subscripions, tuition and registrations (6,500)
Other operating costs 3,060
LEOFF 1 retiree disability, medical and pension costs 26,670
Liability & property insurance 122,531
Subtotal (298,848) -10.1%
2011 Base Budget 2,650,701 -10.1%
Plus 2011 Service Enhancement Requests:
Open space vegetation management support (transfer to CIP) 75,000
Subtotal 75,000 2.5%
Less 2011 Service Reduction Proposals:
2011-2012 reduction of General Fund contribution to YFS (40,000)
Voluntary Intergovernmental Contributions (16,000)
Subtotal (56,000)
2011 Final Budget 2,669,701 -9.5%
_________________________________
G-172 City of Mercer Island 2011-2012 Budget
Department:
Non-Departmental
2011-2012 Budget Analysis
Intergovernmental Services & Other General Government Services
General, Self-Insurance, Beautification & Firemen’s Pension Funds (cont’d)
% Change
2012 Analysis Budget
2011-2012
2011 Final Budget 2,669,701
Plus 2012 General Inflationary Increases 23,599 0.9%
Plus (Less) 2012 Other Significant Changes:
Liability & property insurance 33,955
LEOFF 1 retiree disability, medical and pension costs 60,125
Subtotal 94,080 3.5%
2012 Base Budget 2,787,380 4.4%
Plus 2012 Service Enhancement Requests:
None -
Subtotal - 0.0%
Less 2012 Service Reduction Proposals:
None -
Subtotal -
2012 Final Budget 2,787,380 4.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-173
Department Function:
Information Technology (IT)
Description
Support, maintain, and procure all information and technology infrastructure that connects 7 City
facilities and 10 operating departments, including wired and wireless networks, PC’s and laptops,
servers, phones, peripheral devices (e.g. printers, copiers, and PDA’s), citywide and departmental
applications, and City business systems. Consult, train, and assist City staff on all technology issues and
initiatives.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Provide 24/7 Helpdesk services related to all network, PC, and connected peripherals.
• Provide contract and vendor management for all technology related services.
• Provide network service support, including e-mail, internet access, wireless access, and virtual
private networking.
• Provide support of City business systems such as financial, utility billing, fire records, document
management, permitting, email, etc.
• Procure and implement annual computer, server, network, phone, and peripheral replacement
program.
• Manage the implementation of technology projects.
• Develop custom applications where needed.
• Provide or contract for computer training of City staff.
2011-2012 Key Initiatives
• Complete migration from a physical server to virtual server infrastructure.
• Continue to convert City physical and digital document management to electronic document
management system.
• Develop and implement a mobile pilot for maintenance management.
• Implement an intranet update at minimal cost to the City.
• Continue report development for department management.
• Participate in the online electronic plan review project with eCityGov Alliance.
_________________________________
G-174 City of Mercer Island 2011-2012 Budget
Department Function:
Information Technology (IT)
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 212,731 226,268 219,410 222,482 -3.0% 1.4%
Benefits 62,297 71,947 67,485 75,478 -6.2% 11.8%
Supplies 33,946 25,900 14,500 14,500 -44.0% 0.0%
Contractual Services 23,605 49,100 50,500 50,500 2.9% 0.0%
Communications 42,895 38,460 42,800 42,800 11.3% 0.0%
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges 8,642 12,900 6,000 6,000 -53.5% 0.0%
Intergovernmental Services 12,960 15,000 21,800 22,500 45.3% 3.2%
Capital - 6,000 - - -100.0% N/A
Total 397,077 445,575 422,495 434,260 -5.2% 2.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-175
Department Function:
Geographic Information Systems (GIS)
Description
Support City departments by building and maintaining maps related to the City’s infrastructure (streets,
sewer, water, storm, etc.), services, and properties (residential, commercial, and public). Provide access
to geographic information through printed maps for the public, through a web-based viewing tool for
City staff, and via the eCityGov consortium for both the public and City staff.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• Update property layer, which includes plats, short plats, lot-line revisions, etc.
• Update easement layer, which includes all utility and non-utility easements.
• Update utility layers, which include all water, sewer, and storm drainage infrastructure.
• Update annual Transportation Improvement Plan (TIP) maps.
• Provide printed maps for Fire (including Bellevue Fire) and Police use in vehicles.
• Update and deliver annual Water Utility atlas to utility teams and engineers.
• Update and deliver annual Sewer Utility atlas to utility teams and engineers.
• Provide maps and information to support services and decision making in all City departments.
• Provide map books for use by the public and staff in DSG Customer Service.
• Provide online web based access to GIS data.
• Maintain software for GIS data and access to online GIS.
• Maintain GIS data to support departmental business systems such as permitting, maintenance
management, utility billing, parks, public safety dispatching and addressing, etc.
2011-2012 Key Initiatives
• Further Development of External and Internal Web GIS websites.
• Implement upgrade to version 10.0 of GIS software in order to optimize usage of all GIS-related
software.
• Deliver annual Fire Response Wall Maps to Station 91 and Station 92.
• Deliver annual Water and Sewer Atlases to Utilities Crews and Engineers.
• Update Public Safety Mapping of Crime and Fire incidents on public web GIS site.
• Create Parks and Trails Mapping on public web GIS site.
• Integrate Streets and Pavement Data into existing Streets layer.
• Consolidate Land Use layers from GIS and Planning and combine with Document Management
System.
• Assist in the development of NWMaps mapping portal.
_________________________________
G-176 City of Mercer Island 2011-2012 Budget
Department Function:
Geographic Information Systems (GIS)
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages 119,911 134,763 137,348 139,203 1.9% 1.4%
Benefits 38,342 47,165 47,121 52,653 -0.1% 11.7%
Supplies 3,422 - - - N/A N/A
Contractual Services 17,410 28,000 15,000 15,000 -46.4% 0.0%
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental 6,909 6,909 20,070 20,070 190.5% 0.0%
Other Services & Charges 260 - - - N/A N/A
Intergovernmental Services - - - - N/A N/A
Capital - - - - N/A N/A
Total 186,253 216,837 219,539 226,926 1.2% 3.4%
_________________________________
City of Mercer Island 2011-2012 Budget G-177
Department Function:
Mandatory Intergovernmental Services
Description
Participate in the following regional efforts as required by state law: 1) King County Alcoholism
program, which provides treatment for alcoholics, persons incapacitated by alcohol, and intoxicated
persons (per RCW 70.96); and 2) Puget Sound Air Pollution Control Authority, which is responsible for
the prevention, abatement, and control of air pollution (per RCW 70.94) in the Puget Sound region.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
#4 The community will support attractive, high quality neighborhood and business environments.
Services & Products
• Remit 2% of liquor taxes received quarterly to King County Alcoholism program.
• Support Atmospheric monitoring and implementation of pollution controls.
2011-2012 Key Initiatives
• Continue participation in King County Alcoholism program.
• Continue participation in Puget Sound Air Pollution Control Authority.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages - - - - N/A N/A
Benefits - - - - N/A N/A
Supplies - - - - N/A N/A
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges - - - - N/A N/A
Intergovernmental Services 27,568 28,150 29,566 30,453 5.0% 3.0%
Capital - - - - N/A N/A
Total 27,568 28,150 29,566 30,453 5.0% 3.0%
_________________________________
G-178 City of Mercer Island 2011-2012 Budget
Department Function:
Voluntary Intergovernmental Services
Description
Participate on a voluntary basis in the following organizations: Association of Washington Cities
(AWC), A Regional Coalition for Housing (ARCH), Suburban Cities Association (SCA), Puget Sound
Regional Council (PSRC), and Alliance for Innovation. Support the Interlocal Waterfowl program.
Contract for human services with the following agencies/programs: Eastside Legal Aid Program (ELAP),
Eastside Sexual Assault Center for Children, King County Sexual Assault Resource Center, and the City
of Seattle’s Re-investing in Youth Program.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
#3 The community will support reliable public infrastructure and protect its considerable public
investments.
#4 The community will support attractive, high quality neighborhood and business environments.
#5 The community will support a broad range of recreational, cultural, health, and educational
opportunities.
Services & Products
• AWC is the official organization of cities and towns in the state, established to aid local
governments in finding solutions of common problems.
• ARCH plans and coordinates affordable housing efforts for the cities of Bellevue, Kirkland,
Redmond, Woodinville, Bothell, Mercer Island, and Issaquah to achieve local, regional, and state
affordable housing goals and mandates.
• SCA is the forum that elected officials in King County use to coordinate regional policy efforts
affecting King County cities.
• PSRC is a voluntary organization of cities and counties committed to cooperative planning for the
future of the region.
• Alliance for Innovation is a network of local governments throughout the nation that share
information about innovative programs, services, and technologies.
• The interlocal waterfowl program is a regional effort to control the Canadian Geese population and
reduce the birds' impact on public and private waterfront properties.
• ELAP provides free legal advice to indigents and senior citizens on the Eastside, sponsoring bi-
weekly clinics on various legal subjects including domestic relations, wills, trusts, and real property.
• The Eastside Sexual Assault Center for Children provides intervention and counseling services for
families dealing with the sexual assault of children.
• The King County Sexual Assault Resource Center provides services to victims of sexual assault and
public education to schools and communities related to sexual assault.
• The RIY program is a countywide effort that seeks to increase resources for proven, cost effective
services for troubled youth that reduce crime and save criminal justice and other deep-end system
costs.
_________________________________
City of Mercer Island 2011-2012 Budget G-179
Department Function:
Voluntary Intergovernmental Services
2011-2012 Key Initiatives
• Continue participation in state, regional, and national organizations, except for the Suburban Cities
Association in 2011-2012.
• Discontinue participation in the Interlocal Waterfowl program in 2011-2012.
• Maintain current agreements with human service agencies/programs.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages - - - - N/A N/A
Benefits - - - - N/A N/A
Supplies - - - - N/A N/A
Contractual Services - - - - N/A N/A
Communications - - - - N/A N/A
Fleet/Computer/Equipment Rental - - - - N/A N/A
Other Services & Charges - - - - N/A N/A
Intergovernmental Services 189,616 270,704 230,117 232,027 -15.0% 0.8%
Capital - - - - N/A N/A
Total 189,616 270,704 230,117 232,027 -15.0% 0.8%
_________________________________
G-180 City of Mercer Island 2011-2012 Budget
Department Function:
Other General Government Services
Description
Encompass goods and services that are either citywide or non-departmental in scope and interfund
transfers from the General Fund to other funds in support of various programs.
Priority of Government
#2 The community will support effective, efficient, and legal delivery of public services.
Services & Products
• General office supplies, postage, postage machine rental, copier leases, and armored car service
• Community survey, fiscal studies, labor contract negotiation support, and management consulting
services
• Annual eGov membership and operating costs
• General, property, and automobile liability insurance
• Employee salary adjustment reserve
• LEOFF 1 retiree direct medical costs and health insurance premiums
• Firemen's Pension payments to eligible retirees
• Ongoing General Fund support of Youth & Family Services programs
• Ongoing General Fund support of technology and equipment portion of CIP
2011-2012 Key Initiatives
• Engage a consultant to conduct an actuarial study of police and fire retiree medical and long-term
care costs and of firefighter pension costs.
Expenditure Summary by Category
Expenditure 2009 2010 2011 2012 Percent Change
Description Actual Estimate Budget Budget 10-11 11-12
Salaries & Wages - 43,581 28,236 43,178 -35.2% 52.9%
Benefits 526,914 586,200 612,870 672,995 4.5% 9.8%
Supplies 34,588 55,538 41,000 41,000 -26.2% 0.0%
Contractual Services 67,683 144,600 111,880 89,100 -22.6% -20.4%
Communications 21,532 41,200 33,200 33,200 -19.4% 0.0%
Fleet/Computer/Equipment Rental 71,310 56,053 65,221 66,171 16.4% 1.5%
Insurance 610,409 664,743 787,274 844,319 18.4% 7.2%
Other Services & Charges 8,011 19,500 12,000 14,000 -38.5% 16.7%
Intergovernmental Services 1,127 3,000 - - -100.0% N/A
Interfund Transfers 1,103,743 1,036,280 718,337 720,937 -30.7% 0.4%
Total 2,445,317 2,650,695 2,410,018 2,524,900 -9.1% 4.8%
_________________________________
City of Mercer Island 2011-2012 Budget G-181
_________________________________
G-182 City of Mercer Island 2011-2012 Budget
Section H. Capital Improvement Program
Table of Contents
Introduction ...................................................................................... H-1
Project Summary.............................................................................. H-12
Individual Project Sheets ................................................................ H-19
Six-Year Fund Statements .............................................................. H-107
Capital Improvement Program
Introduction
The two plans that make up the 2011-2012 Capital Improvement Program (CIP)—the Capital
Reinvestment Plan (CRP) and Capital Facilities Plan (CFP)—have been developed according to the
guidelines set forth in the CIP budget policy (see Section C) and the City’s Comprehensive Plan.
Each biennium, Council provides direction through its regular meetings, semi-annual planning
discussions, and various budget policies. Adoption of comprehensive planning documents, including the
Transportation Improvement Plan (TIP) in June 2010, the Pedestrian and Bicycle Facilities Plan in June
2010, the Park and Recreation Plan in February 2007, the Open Space Vegetation Plan in 2004, the
Luther Burbank Park Master Plan in April 2006, the Ballfield Use Analysis in October 2007, the Water
System Plan in July 2008, the General Sewer Plan in February 2003, and the Comprehensive (Storm)
Basin Review in December 2006 give more specific project direction. In the case of the TIP, the Council
approves the street and other related projects, which are then simply inserted into the capital budget.
Staff has been developing the 2011-2016 CIP since March 2010. A preview of the proposed CIP was
presented to Council in June 2010. The Preliminary CIP was presented to Council on October 18,
2010. Adopted changes from the Council budget review process are detailed later in this section and
have been reflected throughout the Final Budget Document.
The capital budget is made up almost entirely of reinvestment projects (CRP) to maintain our existing
infrastructure. The most significant reinvestments (all close to $1.0 million) are for stabilization of
Storm Watercourse Basin 6.3 in 2011, improvements to the First Hill Water System in 2012, and
resurfacing a segment of Island Crest Way in 2012.
2011-2012 Proposed CIP
Table 1 compares planned spending for specific categories of projects in the 2011-2012 CIP with the
actual and forecasted costs for the previous two biennia. (Actual spending varies from budget due to
factors such as permitting delays, bids which vary from project cost estimates and added projects.)
Table 1 – Comparison of Proposed Budget by Project Category
2007-08 2009-10 2011-12
Project Category Actual Forecast Budget
Parks, Recreation and Open Space [1] $3,600,921 $2,919,782 $1,997,000
[2] $4,443,071 $4,576,104 $3,046,000
Streets, Pedestrian and Bicycle Facilities
Buildings, Equipment and Technology [3] $6,650,031 $4,847,019 $3,130,000
[4] $3,944,852 $28,599,027 $6,292,000
Utilities
Total $18,638,875 $40,941,932 $14,465,000
[1] Includes $1.0 million for improvements to South Mercer Playfields and $1.1 million for Luther Burbank Park in 2007-2008. Also
includes $1.0 million for additional improvements to South Mercer Ballfields in 2009-2010.
[2] Includes $1.1 million for SE 40th Corridor improvements and $1.0 million for improvements to 76th Avenue in the Town Center in
2007-2008. Also includes an additional $700,000 for SE 40th Corridor improvements, $1.2 million for Town Center Traffic Signal
improvements, $1.1 million for Residential Streets, and $300,000 for East Mercer Way Shoulder construction in 2009-2010.
[3] Includes $3.3 million for Fleet Replacements (including Fire Engines, Marine Patrol Boats, an Aid Car, Vactor and Jet Trucks, and a
Street Sweeper) in 2007-2008. Also includes $1.0 million for PEAK in 2009-2010.
[4] Includes $24.2 million for Sewer Lake Line construction in 2009-2010. Also includes $847,000 for construction of the Emergency
Water Supply Well Facility in 2009-2010.
_________________________________
City of Mercer Island 2011-2012 Budget H-1
Capital Improvement Program
Capital Improvement Financing Strategy
Each biennial capital budget is part of a broader CIP financing plan that looks into the future to match
facility needs with realistic financing strategies. (Please refer also to the CIP budget policy in Section C
for additional detail.)
Consistent with established budget policies and past Council financing strategies, CIP funding for the
next two years relies heavily on existing, available fund balances and projected revenues from Real
Estate Excise Taxes (REET), Fuel Taxes (State shared revenues), and Utility rates. The General Fund
continues to be the sole source for capital investments in technology and equipment.
Most revenues for capital projects come with restrictions. Utility rates may only be used for projects of
the respective utility; fuel taxes may only be used for street and trail projects; and REET is reserved for
capital projects to help develop a community’s public infrastructure (e.g., parks, open space and streets).
The City’s capital financing strategy has been to use these restricted revenues on a “pay as you go” basis
for needed improvements. This strategy remains unchanged, except for costly utility projects for which
debt financing can “smooth” utility rate spikes.
REET is the 0.5% tax paid by the seller in property transactions. State law restricts the use of REET for
specific capital purposes. REET-1 (the 1st quarter of 1% of the sales price) may be used for streets,
parks, facilities, or utilities. REET-2 (the 2nd quarter of 1% of the sales price) may be used for streets,
parks, or utilities, but may not be used for facilities. Neither REET-1 nor REET-2 may be used for
equipment or technology.
REET is the largest revenue source for the projects in the Street and Capital Improvement Funds. REET
revenue can vary significantly from year to year as its base (property sales) is highly dependent on
economic conditions and interest rates. With current economic conditions, REET revenues declined in
2008, then declined further in 2009 due to a significant drop in the number of home sales from 603
homes in 2004 to a low of 260 homes in 2008 and 267 homes in 2009. Average home prices also
declined from a high of $1.24 million in 2008 to $854,000 a year later. REET has recovered slightly in
2010, with the first time homebuyer tax credit incentive and lower home prices. It is anticipated that
home sales will continue to recover, although at a moderate rate, in 2011 and 2012.
Continuing the City’s CIP financing strategy, REET-1 revenues are used to fund parks, open space, and
public building maintenance projects and to pay the debt service on the Mercer View property and the
new Community Center. REET-2 revenues continue to be used for infrastructure needs, namely
construction and maintenance of streets, pedestrian and bicycle facilities.
Because they cannot rely upon REET revenues, expenditures for new vehicles, equipment, and
technology come from general purpose revenue, reserve, or grant funding sources. An example is the
purchase of Firefighting Equipment, including technical rescue tools, planned for this biennium.
Consistent with their financial policies, utility capital improvements are funded from utility rates,
primarily on a pay-as-you-go basis.
Table 2 below shows an overview of the CIP financing strategy.
_________________________________
H-2 City of Mercer Island 2011-2012 Budget
Capital Improvement Program
Table 2 - Capital Improvement Program Financing Strategy
REET 1 REET 2 General Purpose Revenues Utilities
Parks Streets Equipment Sanitary Sewer
• Construction • Construction • Vehicle Replacement • Construction
• Maintenance • Maintenance • Public Safety Items • Maintenance
Open Space Pedestrian and Bicycle Technology Stormwater
• Property Acquisition Facilities • Computers • Construction
• Planning • Construction • Software • Maintenance
• Improvements • Maintenance • Communications Water
Public Buildings • Construction
• Repair • Maintenance
• Maintenance
• Planning and Design
Real Estate Excise Tax (REET) Forecast
In September 2010, staff revised the REET Forecast, increasing the projected number of house sales in
2010 to 300 (up from the 275 forecast for the CIP Preview in June 2010), followed by a slow recovery
in 2011-2016. In addition, staff revised the 2010 REET forecast to reflect an increase in the average
home sale price from the $942,000 projected in June 2010 up to $1.0 million. The revised projection
more accurately reflects the trend that has been seen in the region.
Historical home sales (1999-2009) as well as the forecasted number of home sales (2010-2016) are
shown in the chart below.
Number of Home Sales
# Sales
700
603
579
600
563 545
486 500 500 500
500 475
442 433 429
400
400
358
325
300
300 267
260
200
100
-
-
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Fcst Fcst Fcst Fcst Fcst Fcst Fcst
_________________________________
City of Mercer Island 2011-2012 Budget H-3
Capital Improvement Program
Historical home sale prices (1999-2009) as well as forecasted home sale prices (2010-2016) are shown
in the chart below.
Average Home Sale Price
$ Millions
1.60
1.39
1.40
1.29
1.24
1.19
1.20
1.07 1.05 1.11
1.00 1.00
1.00 0.96
0.90
0.85
0.80
0.80 0.74
0.70 0.69
0.66 0.64
0.60
0.40
0.20
-
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Fcst Fcst Fcst Fcst Fcst Fcst Fcst
The historical trend for REET Revenue (shown in millions) as well as the forecast for REET used in
developing the Preliminary Budget is presented in the chart below. Note that the spike in 2010 revenue
reflects the sale of Shorewood Heights Apartments in September 2010, generating about $500,000 in
REET.
$4.00
$3.71 $3.59
$3.33
$3.50
$3.10
$2.93
$3.00 $2.77
$2.77
$2.50
$2.50
$1.98
$1.97 $2.35 $2.18
$2.00
$1.62 $1.51
$1.82
$1.50
$1.71
$1.00
$1.17 $1.26
$0.50
$0.00
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Fcst Fcst Fcst Fcst Fcst Fcst Fcst
_________________________________
H-4 City of Mercer Island 2011-2012 Budget
Capital Improvement Program
Fund Balance Trends
The fund balance in the Street Fund was drawn down by close to $1.4 million in 2009-2010, and is
expected to be drawn down by an additional $420,000 during the 2011-2012 biennium, in accordance
with the 6-year TIP (Transportation Improvement Plan). The available fund balance in the Street Fund
is projected to be completely used by the end of 2014, given the current REET revenue forecast and
planned projects.
The fund balance in the CIP Fund was drawn down by $280,000 in 2009-2010, and is expected to be
drawn down by an additional $620,000 during the 2011-2012 biennium, largely as a result of continued
capital reinvestment needs in conjunction with the drop in REET revenue available to fund projects.
Planned capital reinvestment projects for 2013-2016 will draw the available fund balance into a negative
position starting in 2013, given current revenue forecasts.
The available fund balance in the Technology and Equipment Fund will be drawn down to about $394,000
by the end of 2012 as a result of the reduced contribution from the General Fund and planned
reinvestment in technology and equipment in 2011 and 2012. While the available fund balance is
projected to decline during the 6 year plan, it is still projected to have a positive balance at the end of
2016.
Rates are set for the Water, Sewer, and Storm Water Funds at levels to support daily operations, routine
maintenance, and capital reinvestment planned for the 6 year period (2011-2016). Available fund
balances are used in conjunction with new revenues generated from rates and occasional debt proceeds
to meet the funding needs of each utility. Financing for all funds are planned so that fund balances are
drawn down by the end of the 6 year period.
See Section F (Utility Funds Summary) and Section I (Recap by Fund) for more details on fund balances.
Project Management
Project Management staff costs are built into the budget of each capital project. Historical (2005-2010)
and planned (2011-2012) staffing levels are as follows:
DEPARTMENT POSITION 2005 2006 2007 2008 2009 2010 2011 2012
Regular FTE's
Development Services City Engineer 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25
Maintenance Assistant City Engineer 1.00 1.00 1.00 1.00 0.60 0.60 0.60 0.60
Maintenance Street Engineer 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Maintenance Utilities Engineer 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Maintenance Facilities Team Member - - 0.50 0.50 0.50 0.50 0.50 0.50
Total Regular FTE 3.25 3.25 3.75 3.75 3.35 3.35 3.35 3.35
Contract FTE's
City Manager Records Management Coord - - - - 1.00 1.00 - -
Maintenance Storm Water Proj Mgr - - 1.00 1.00 0.75 0.75 0.75 1.00
Maintenance Contract Streets Proj Mgr - - 0.50 0.50 1.00 1.00 - -
Parks and Recreation Forest Steward - - - - 0.75 0.75 0.75 0.75
Parks and Recreation Contract Parks Proj Mgr - - 0.50 0.50 1.00 1.00 - -
Non-Departmental CIP Administrative Support - - - - 0.50 0.50 - -
Total Contract FTE - - 2.00 2.00 5.00 5.00 1.50 1.75
TOTAL CIP FTE 3.25 3.25 5.75 5.75 8.35 8.35 4.85 5.10
_________________________________
City of Mercer Island 2011-2012 Budget H-5
Capital Improvement Program
Contract staffing is used to manage fluctuations in the number of capital projects and when specialized
skills are required. Given the decline in REET revenues and, consequently the number of CIP projects,
the 2011-2012 Budget assumes a reduction of 3.5 contract FTE’s: 2 Project Managers, a Records
Management Coordinator and a half-time CIP Administrative Support position. One Project Manager
and the Administrative Support position (1.5 FTE’s) were vacant in 2010.
In addition to the listed staffing, a small percentage of time is spent by Parks staff (Parks and Recreation
Operations Superintendent, Parks Maintenance Team Leader, and the Parks Arborist) and the
Information and Geographic Services Team on capital project management. Where significant, time is
charged directly to the projects worked on.
Finally, a small percentage of Finance, City Attorney’s Office, Public Information Coordinator,
Maintenance Director, Parks and Recreation Director, and City Manager’s Office support is provided to
capital projects. In order to eliminate a subsidy of CIP by the General Fund, this time is charged through
a CIP Overhead Charge to the Capital Project Funds (Streets, Water, Sewer, Storm Water, and CIP)
and credited back to the General Fund.
Summary of Changes to Proposed CIP
On June 21, 2010, the Council was given a preview of the proposed 2011-2016 CIP. At that meeting,
the Council indicated they would like to modify certain projects. Table 3 summarizes the changes
directed by the Council and made by staff for the 2011-2012 Preliminary Budget.
Table 3 – Summary of Changes to the 2011-2012 Preview CIP in ’000s
June Prelim
Project Preview Budget Change Notes
Council Directed Changes:
Residential Streets 1,100 849 (251) Adopted TIP reduced funding for residential streets
Fire Station 92 Replacement 4,600 - (4,600) Push design/construction from 2011/2012 to 2013/2014
Total Council Changes 5,700 849 (4,851)
Staff Changes:
Luther Burbank Minor Improvements 223 220 (3) Refine project budget
Minor Park Improvements 176 108 (68) Restore 2009-10 budget cut due to improvement in REET
Computer Replacements 238 190 (48) Refine project budget
Fleet Replacements 1,526 1,529 3 Refine project budget
Thrift Shop Repairs 48 36 (12) Push restroom repair from 2011 to 2013
PBF Plan Implementation 1.b 45 - (45) Unsuccessful in CPPW grant application; project cancelled
Total Staff Changes 2,256 2,083 (173)
Plus All Other Projects 11,533 11,533 - No change
TOTAL 19,489 14,465 (5,024)
During the Council’s review of the Preliminary Budget, additional modifications were made to the
proposed CIP. Table 4 summarizes the changes directed by the Council and made by staff for the 2011-
2012 Final Budget.
_________________________________
H-6 City of Mercer Island 2011-2012 Budget
Capital Improvement Program
Table 4 – Summary of Changes to the 2011-2012 Preliminary CIP in ’000s
Prelim Final
Project Budget Budget Change Notes
Council Directed Changes:
Luther Burbank Admin Bldg Repairs 101 94 (7) Remove intercom system
Minor Park Improvements 108 8 (100) Reduce Clarke Beach swim area repairs by $100K
Open Space Vegetation Mgmt 650 800 150 Restore $75K in 2011 and 2012
Total Council Changes 859 902 43
Staff Changes:
EOC Incident Management 50 - (50) Purchase off-the-shelf software in 2010.
Low Impact Development 75 300 225 Notified of $225K DOE grant receipt.
I-90 Park Improvements 115 47 (68) I-90 Play Equip purchased in 2010 (instead of Groveland)
Groveland Playground Equipment - 68 68 I-90 Play Equip purchased in 2010 (instead of Groveland)
Total Staff Changes 240 415 175
Plus All Other Projects 13,366 13,366 - No change
TOTAL 14,465 14,683 218
Project Highlights
• Island Crest Way – This project will resurface Island Crest Way (86th SE to SE 53rd). The
project is scheduled for design ($100,000) in 2011 and construction (just over $1.0 million) in 2012.
The City will also continue its modest arterial street preservation program.
• Residential Streets – Per Council direction, annual residential street overlays will be undertaken
at an accelerated pace in the biennium. The biennial allocation for residential overlays is $951,000,
which represents an increase of $231,000 over the average amount of spent per biennium during
the last two biennia.
• East Mercer Way Shoulders (Phase 7) – This project would extend shoulder improvements on
East Mercer Way south from the 5600 block to the 7400 block of East Mercer Way. Additional
Phases of shoulder work (Phases 8 and 9) are anticipated in 2013 and 2015 also.
• First Hill Water System Improvements – This project will re-configure the First Hill pressure
zone by upsizing the 4-inch water main and making connection changes between the water mains in
the First Hill pressure zone and the water mains served by the reservoir zone. The project is
scheduled for design ($200,000) in 2011 and construction ($1.2 million) in 2012. In order to lower
water rates, as well as in recognition of the good bid environment and low interest rates, staff
proposes using debt financing for the construction of these improvements.
• General Sewer System Improvements – Shifting efforts from the Sewer Lakeline project, staff
will focus on increasing the level of system-wide improvements including pipe lining, pipe
replacement, manhole rehabilitation, and installing clean-outs in the Sewer Lake Line (at a pace of
approximately one per biennium).
• Sub-Basin 6.3 – This project will stabilize approximately 800 linear feet of watercourse with
severe bank erosion which has resulted in the destabilization of the upper bank slopes.
Improvements to Basin 6 (SE 40th to Shorewood Apts.) are being designed in 2010, with
construction ($995,000) planned for 2011.
_________________________________
City of Mercer Island 2011-2012 Budget H-7
Capital Improvement Program
Partially or Unfunded Capital Needs
Reflected in the 6 Year Plan (2011-2016)
Three of the projects included in the proposed 2011-2016 CIP are only partially funded or unfunded.
For one of the projects, full funding depends on receipt of a grant. The funding status for these projects
is summarized in the table below.
Funded Unfunded Total Cost Funding Source
Project Description 2011-2016 2011-2016 Estimate for Unfunded Portion
Island Crest Park Ballfield Lights Replacement 338,000 45,000 383,000 PSE or Energy Grant
PBF Plan Implementation - 100,000 100,000 Excess REET
Fire Station 92 Replacement * - 4,600,000 4,600,000 To be determined
Totals 338,000 4,745,000 5,083,000
* Note that the cost estimate for Fire Station 92 is a placeholder for budget planning purposes. It is very preliminary and will
be refined after the programmatic study (2010). A more accurate cost estimate will be developed during design (2013).
Of particular note are the following projects:
• PBF Plan Implementation – The Pedestrian and Bicycle Facilities Plan was adopted on June 21,
2010. This project is a placeholder, showing staff’s desire to construct a project from the recently
adopted PBF Plan. A possible funding source is REET in excess of the 2011-2012 forecast.
• South Fire Station – Station 92 located at 8473 SE 68th Street was constructed in 1962. If the
building is to continue providing emergency response services, it will eventually need significant
renovation such as seismic strengthening. The cost estimate of $4.6 million is a placeholder for
budget planning purposes. It is very preliminary and will be refined after the programmatic study
(2010). A more accurate cost estimate will be developed during design (2013). Possible funding
sources include cost savings from the Sewer Lake Line project, REET in excess of the 2011-2012
forecast, voted debt (20 years), and a federal grant.
Not reflected in the 6 Year Plan (2011-2016)
In addition to the projects planned above, there are significant capital improvements that are not
included in the 2011-2016 plan and for which a funding source has not yet been determined. The
following projects continue to be unfunded or partially funded:
• Luther Burbank Master Plan Implementation – Design and construction costs to implement
master plan improvements identified in the 2005-2006 planning process were estimated at $8.0
million. Two master plan elements started to be addressed in the 2007-2008 CIP Budget (Shoreline
Restoration and Off-Leash Area Improvements) at a cost of $1.25 million. In November 2008, a
$12.0 million parks bond levy to fund park capital improvements, including master plan elements for
Luther Burbank, was put to a vote and failed. A new funding source for these improvements has
not been identified.
• Town Center Pedestrian Plaza Water Feature (78th Avenue SE at I-90) – A pedestrian
plaza was constructed in 2010 by developers of the neighboring properties. Preliminary schematic
designs for a water feature within this new plaza are being considered. Refined cost estimate are
_________________________________
H-8 City of Mercer Island 2011-2012 Budget
Capital Improvement Program
under development. Potential funding includes 1% for the Arts and available fund balance in the
Beautification Fund.
• Open Space Acquisition (5-6 acres) – This consists of one-time purchases of open space
property as opportunities arise at a cost of approximately $2.0 million per acre. The preferred
funding source identified is voted debt (20 years). REET-1 and other fund balances could also be
used.
• Utility Projects – there is a long list of Utility reinvestment projects (undersized water mains,
sewer lake line clean-outs, aging sewer pipe, storm water basins, and conveyance pipe), which could
be tackled at a faster pace with higher rate increases or additional capital resources.
Reader’s Guide to the CIP
The CIP section of the budget attempts to satisfy various interests, ranging from a high level overview to
detailed specifics of each project planned for the upcoming biennium. The 2011-2016 CIP Project
Summary provides the most succinct presentation of project costs, timing, and funding sources. In this
summary, projects are organized by plan (CRP vs. CFP) first and then by project category:
A. Parks, Recreation and Open Space
B. Streets, Pedestrian and Bicycle Facilities
C. General Government (Equipment, Public Buildings, and Technology)
D. Sewer Utility
E. Storm Water Utility
F. Water Utility
Readers who are interested in project details will want to focus on the Individual Project Sheets. The
project sheets include a detailed project description, identifying the business need and existing
conditions. Detailed expenditure information and revenue sources are described as well. Finally, an
overview of each project’s schedule is presented. On both the CIP Project Summary and Individual
Project Sheets, revenues and expenditures are expressed in thousands of dollars, rounded to the
nearest $1,000.
For the long-range view, Six-Year Fund Statements show projects planned for future years (2011-2016)
and the long-term funding plan. Understandably, predictions about projects in the last four years of the
period are not as precise as for the projects the Council formally approves for implementation in 2011-
2012. Six-year funding plans are presented for the following City Funds:
1. Street Fund
2. Capital Improvement Fund
3. Technology and Equipment Fund
4. Water Fund
5. Sewer Fund
6. Storm Water Fund
_________________________________
City of Mercer Island 2011-2012 Budget H-9
Capital Improvement Program
_________________________________
H-10 City of Mercer Island 2011-2012 Budget
CAPITAL
IMPROVEMENT PROGRAM
Project Summary
This section includes a
listing of projects by Plan
(Reinvestment or New
Facilities) and a listing of
projects by Functional
Category.
Capital Improvement Program
H-12 _________________________________
City of Mercer Island 2011-2012 Budget
Capital Improvement Program
Capital Reinvestment Plan
Parks, Recreation and Open Space Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
19 Open Space - Vegetation Management Open Space 444 422 378 471 490 509 529 2,799 1,797 0 0 0 0 0 0 1,002 2,799
20 Luther Burbank Minor Park Improvements Parks Improvements 110 110 110 110 110 110 110 660 0 0 0 0 0 0 0 660 660
21 Recurring Park Projects Parks Repairs and Maintenance 120 120 120 120 120 120 120 720 720 0 0 0 0 0 0 0 720
22 Homestead - Minor Improvements Parks Repairs and Maintenance 0 0 68 250 0 0 0 318 318 0 0 0 0 0 0 0 318
23 Island Crest Park Minor Improvements Parks Repairs and Maintenance 0 0 68 0 0 0 0 68 68 0 0 0 0 0 0 0 68
Funded - Modified
24 Minor Park Improvements Parks Improvements 0 8 0 584 520 100 275 1,487 1,487 0 0 0 0 0 0 0 1,487
25 Minor Park Improvement - Groveland Play Equipment Parks Improvements 0 0 68 0 0 0 0 68 68 0 0 0 0 0 0 0 68
26 I-90 Park Improvements Parks Repairs and Maintenance 35 47 0 0 100 0 140 287 287 0 0 0 0 0 0 0 287
27 South Mercer Playfields Park Improvements Parks Repairs and Maintenance 0 0 0 68 0 83 759 910 151 0 0 0 759 0 0 0 910
Funded - New Project
28 Community Center Mercerview Grounds Parks Repairs and Maintenance 0 0 0 15 50 0 0 65 65 0 0 0 0 0 0 0 65
Unfunded or Partially Funded
29 Island Crest Park Ballfield Lights Replacement Parks Repairs and Maintenance 0 0 383 0 0 0 0 383 338 0 0 0 0 0 45 0 383
Total Parks, Recreation and Open Space costs 709 707 1,195 1,618 1,390 922 1,933 7,765 5,299 0 0 0 759 0 45 1,662 7,765
Streets, Pedestrian and Bicycle costs Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
30 Arterial Preservation Program Annual Street Maintenance Program 70 70 70 70 70 70 70 420 0 420 0 0 0 0 0 0 420
31 Pavement Marking Replacement Annual Street Maintenance Program 25 35 35 36 38 40 41 225 0 225 0 0 0 0 0 0 225
Funded - Modified
32 Residential Street Overlays Annual Street Maintenance Program 1,080 378 471 707 509 764 550 3,379 0 3,379 0 0 0 0 0 0 3,379
33 Arterial Street Improvements (2013 - 2016) Arterial Street Improvements 0 0 0 644 1,231 588 265 2,728 0 2,728 0 0 0 0 0 0 2,728
34 Island Crest Way Resurfacing (86th to 53rd) - Phase I Arterial Street Improvements 0 100 1,045 0 0 0 0 1,145 0 1,145 0 0 0 0 0 0 1,145
35 PBF Reinvestment - Island Crest Way (86th to 53rd) Pedestrian and Bicycle Facilities 0 0 120 0 0 0 0 120 0 120 0 0 0 0 0 0 120
36 Pedestrian and Bicycle Facilities (PBF) - Reinvestment Pedestrian and Bicycle Facilities 0 0 0 109 136 206 70 521 0 521 0 0 0 0 0 0 521
37 Town Center Streets - 80th Ave, SE 29th and 32nd Town Center Street Reconstruction 0 0 0 0 100 647 0 747 0 747 0 0 0 0 0 0 747
38 Town Center Streets - Overlay Town Center Street Reconstruction 0 0 0 680 0 0 0 680 0 680 0 0 0 0 0 0 680
Funded - New Project
39 Chip Seal Pilot Project Annual Street Maintenance Program 0 102 0 0 0 0 0 102 0 102 0 0 0 0 0 0 102
Total Streets, Pedestrian and Bicycle costs 1,175 685 1,741 2,246 2,084 2,315 996 10,067 0 10,067 0 0 0 0 0 0 10,067
LEGEND:
Projects included in the 2011-2012 Preliminary Budget are shown in bold text with gray background.
_____________________________
City of Mercer Island 2011-2012 Budget H-13
Capital Improvement Program
General Government Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
40 Fuel Clean Up Other Equipment 70 74 75 0 0 0 0 149 0 0 0 0 0 0 0 149 149
41 Firefighting Equipment Small Technology/Equipment 35 36 35 35 36 36 35 213 0 0 0 213 0 0 0 0 213
42 Computer Equipment Replacements Technology 102 120 70 143 188 143 85 749 0 0 0 0 749 0 0 0 749
43 Website Redesign Technology 35 0 15 0 15 0 0 30 0 0 0 30 0 0 0 0 30
44 Technology Strategic Plan Technology 0 0 0 0 0 0 75 75 0 0 0 75 0 0 0 0 75
45 Server Upgrades Technology 25 0 0 0 50 0 0 50 0 0 0 50 0 0 0 0 50
Funded - Modified
46 Fleet Replacements Other Equipment 254 913 616 525 415 755 841 4,065 0 0 0 0 4,065 0 0 0 4,065
47 City Hall Building Repairs Public Buildings 71 79 52 199 188 142 188 848 848 0 0 0 0 0 0 0 848
48 Maintenance Building Repairs Public Buildings 71 53 12 85 95 199 102 546 136 0 410 0 0 0 0 0 546
49 Thrift Shop Repairs Public Buildings 57 14 22 44 51 41 30 202 0 0 0 0 0 202 0 0 202
50 North Fire Station Repairs Public Buildings 113 35 54 83 53 88 79 392 392 0 0 0 0 0 0 0 392
51 South Fire Station Repairs Public Buildings 11 22 15 24 32 31 28 152 152 0 0 0 0 0 0 0 152
52 Luther Burbank Admin Building Repairs Public Buildings 48 46 48 57 41 40 36 268 268 0 0 0 0 0 0 0 268
53 Community Center Building Repairs Public Buildings 49 132 88 71 67 48 48 454 454 0 0 0 0 0 0 0 454
54 High Accuracy Orthophotos Technology 0 0 45 0 0 30 0 75 0 0 0 75 0 0 0 0 75
55 Financial System Upgrades Technology 30 0 0 25 0 0 0 25 0 0 0 25 0 0 0 0 25
56 CIP Database Enhancements Technology 0 0 0 50 0 0 0 50 0 0 0 50 0 0 0 0 50
57 Mobile Asset Data Collection Technology 0 0 0 60 0 0 0 60 0 10 20 30 0 0 0 0 60
58 Maintenance Management System Refresh Technology 0 0 10 0 20 150 0 180 0 0 0 180 0 0 0 0 180
59 Document Management Technology 73 65 65 70 70 0 0 270 0 0 0 270 0 0 0 0 270
Funded - New Project
60 Fuel System Update Technology 0 10 0 0 0 0 0 10 0 0 0 0 10 0 0 0 10
61 Self Contained Breathing Apparatus Replacement Small Technology/Equipment 0 0 0 55 55 65 65 240 0 0 0 240 0 0 0 0 240
62 CCMV Technology & Equipment Replacement Small Technology/Equipment 0 31 31 32 32 42 42 210 0 0 0 210 0 0 0 0 210
63 Phone System Upgrades Technology 0 0 0 15 15 15 15 60 0 0 0 60 0 0 0 0 60
Total General Government costs 1,044 1,630 1,253 1,573 1,423 1,825 1,669 9,373 2,250 10 430 1,508 4,824 202 0 149 9,373
Sewer Utility Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
64 Sewer System Emergency Repairs Sewer System Rehabilitation 50 50 50 50 50 50 50 300 0 0 300 0 0 0 0 0 300
Funded - Modified
65 General Sewer System Improvements Sewer System Improvements 180 434 515 500 200 844 757 3,250 0 0 3,250 0 0 0 0 0 3,250
66 Sanitary Sewer System Telemetry Sewer System Improvements 150 50 0 0 0 0 0 50 0 0 50 0 0 0 0 0 50
67 Sewer System Generator Replacement Sewer System Rehabilitation 70 0 140 0 150 0 160 450 0 0 450 0 0 0 0 0 450
68 Sewer System Pump Station Repairs Sewer System Rehabilitation 50 55 55 60 60 65 65 360 0 0 360 0 0 0 0 0 360
Funded - New Project
69 East Mercer Way Sewer Replacement Sewer System Improvements 0 0 0 75 500 0 0 575 0 0 575 0 0 0 0 0 575
Total Sewer Utility costs 500 589 760 685 960 959 1,032 4,985 0 0 4,985 0 0 0 0 0 4,985
_____________________________
H-14 City of Mercer Island 2011-2012 Budget
Capital Improvement Program
Storm Drainage Utility Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
70 Neighborhood Drainage Improvements Neighborhood Drainage Improvements 60 70 70 80 80 90 90 480 0 0 480 0 0 0 0 0 480
Funded - Modified
71 Storm Water System Replacements Other Storm Drainage System Projects 70 65 251 0 0 0 0 316 0 0 316 0 0 0 0 0 316
72 Conveyance System Improvements (2013-2016) Other Storm Drainage System Projects 0 0 0 70 380 20 480 950 0 0 950 0 0 0 0 0 950
73 Storm Water Basin Improvements (2013-2016) Watercourse Projects 0 0 0 819 475 890 442 2,626 0 0 2,626 0 0 0 0 0 2,626
74 Medium/Large Basin and Conveyance System Impvmts. Watercourse Projects 0 70 713 0 0 0 0 783 0 0 783 0 0 0 0 0 783
75 Sub Basin 6.3 Watercourse Stablization Project Watercourse Projects 75 995 0 0 0 0 0 995 0 0 995 0 0 0 0 0 995
Total Storm Drainage Utility costs 205 1,200 1,034 969 935 1,000 1,012 6,150 0 0 6,150 0 0 0 0 0 6,150
Water Utility Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
76 Water Model Updates/ Fire Flow Analysis Other Water System Projects 0 0 20 0 25 0 20 65 0 0 65 0 0 0 0 0 65
77 Water System Plan Update Other Water System Projects 0 0 0 60 60 0 0 120 0 0 120 0 0 0 0 0 120
78 Hydrants and Other Water System Components Water System Improvements 55 60 60 65 65 65 65 380 0 0 380 0 0 0 0 0 380
Funded - Modified
79 Meter Replacement Program Other Water System Projects 25 40 40 45 45 45 45 260 0 0 260 0 0 0 0 0 260
80 First Hill Water System Improvements Undersized Main Replacement Program 0 200 1,200 0 0 0 0 1,400 0 0 1,400 0 0 0 0 0 1,400
81 88th Ave. SE & 86th Ave SE Water System Impvmts. Undersized Main Replacement Program 0 0 0 100 471 0 0 571 0 0 571 0 0 0 0 0 571
82 Sandy Cove Water System Improvement Undersized Main Replacement Program 0 348 0 0 0 0 0 348 0 0 348 0 0 0 0 0 348
83 ICW/SE 40th to 86th Ave Water System Impvmts. Water System Improvements 0 0 112 528 0 0 0 640 0 0 640 0 0 0 0 0 640
84 EMW 5400 to 6000 Block Watermain & PRV Stations Water System Improvements 0 0 0 129 723 0 0 852 0 0 852 0 0 0 0 0 852
85 Mercerwood Drive Water Main Replacement Water System Improvements 0 0 0 0 138 785 0 923 0 0 923 0 0 0 0 0 923
Funded - New Project
86 97th Ave SE 2-in Galvanized Watermain Replacement Undersized Main Replacement Program 0 39 0 0 0 0 0 39 0 0 39 0 0 0 0 0 39
87 Mercerwood Neighborhood Water System Improvements Undersized Main Replacement Program 0 0 0 0 0 198 1,113 1,311 0 0 1,311 0 0 0 0 0 1,311
88 93rd Ave and SE 72nd St Water Main Replacement Undersized Main Replacement Program 0 0 0 0 0 0 155 155 0 0 155 0 0 0 0 0 155
89 Watermain Replacement Projects (2013-2016) Undersized Main Replacement Program 0 0 0 0 0 335 381 716 0 0 716 0 0 0 0 0 716
90 85th Ave SE Watermain Replacement Water System Improvements 0 0 0 481 0 0 0 481 0 0 481 0 0 0 0 0 481
91 ICW/86th Ave to 53rd Pl Water System Impvmts. Water System Improvements 0 302 0 0 0 0 0 302 0 0 302 0 0 0 0 0 302
92 Street Related Water CIP Projects Water System Improvements 0 148 65 0 128 250 250 841 0 0 841 0 0 0 0 0 841
Total Water Utility costs 80 1,137 1,497 1,408 1,655 1,678 2,029 9,404 0 0 9,404 0 0 0 0 0 9,404
Total Capital Reinvestment Plan 3,713 5,948 7,480 8,499 8,447 8,699 8,671 47,744 7,549 10,077 20,969 1,508 5,583 202 45 1,811 47,744
_____________________________
City of Mercer Island 2011-2012 Budget H-15
Capital Improvement Program
Capital Facilities Plan
Parks, Recreation and Open Space Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
93 Regional Trail Connections (KC Prop 2 Levy) Parks Improvements 72 72 73 75 0 0 0 220 0 0 0 0 0 0 0 220 220
Total Parks, Recreation and Open Space costs 72 72 73 75 0 0 0 220 0 0 0 0 0 0 0 220 220
Streets, Pedestrian and Bicycle costs Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
94 Safe Route to School Pedestrian and Bicycle Facilities 0 100 0 100 0 0 0 200 0 200 0 0 0 0 0 0 200
Funded - Modified
95 Guardrail Development Other Transportation Projects 25 0 25 0 25 0 0 50 0 50 0 0 0 0 0 0 50
96 Pedestrian and Bicycle Facilities Plan Implementation Pedestrian and Bicycle Facilities 35 45 45 45 45 45 45 270 0 270 0 0 0 0 0 0 270
97 East Mercer Way Shoulders, Phase 7 - 9 Pedestrian and Bicycle Facilities 263 305 0 326 0 353 0 984 0 984 0 0 0 0 0 0 984
Funded - New Project
98 SE 53rd Place PBF Improvement Pedestrian and Bicycle Facilities 0 0 0 0 0 0 260 260 0 260 0 0 0 0 0 0 260
Unfunded or Partially Funded
99 Pedestrian and Bicycle Facilities Plan Implementation Pedestrian and Bicycle Facilities 0 0 100 0 0 0 0 100 0 0 0 0 0 0 0 100 100
Total Streets, Pedestrian and Bicycle costs 323 450 170 471 70 398 305 1,864 0 1,764 0 0 0 0 0 100 1,864
General Government Project Costs (in thousands) Source of Funds (in thousands)
Project Description 2010 2011 2012 2013 2014 2015 2016 Total REET Street Utilities General Fees Contrib's Grants Other Total
Funded - No Changes
100 Small Technology/Equipment Items Small Technology/Equipment 50 50 50 50 50 50 50 300 0 0 0 300 0 0 0 0 300
Funded - Modified
101 City Information via Web Based GIS Technology 30 10 0 10 0 10 0 30 0 0 0 30 0 0 0 0 30
Funded - New Project
102 South End Emergency Shelter Public Buildings 0 80 0 0 0 0 0 80 0 0 0 45 0 35 0 0 80
Unfunded or Partially Funded
103 Fire Station 92 Replacement Public Buildings 20 0 0 460 4,140 0 0 4,600 0 0 0 0 0 0 0 4,600 4,600
Total General Government costs 100 140 50 520 4,190 60 50 5,010 0 0 0 375 0 35 0 4,600 5,010
Storm Drainage Utility Project Costs (in thousands) Source of Funds (in thousands)