City of Spokane Faces New Budget Deficit Amid Slowing National Economy, External Pressures
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~ Spokane City Faces Budget Challenges Despite Closing $25 Million Deficit in 2024

The City of Spokane is facing budget challenges due to a slowing national economy, weak consumer confidence, and sales tax revenue not keeping pace with historical trends. This was announced by Erin Hut, the Communications Director for the city, in a press release on Thursday.

According to Hut, the city had successfully closed a $25 million structural budget deficit in 2024. However, this trend is not unique to Spokane and is being faced by local governments across the country.

At a meeting with the Spokane City Council on Thursday, Mayor Lisa Brown outlined the city's current financial situation. The city is facing a $13 million deficit, which is also impacted by federal contract uncertainty, constrained by collective bargaining contracts, and exacerbated by inflation and rising jail costs.

One of the major contributors to this deficit is the increasing costs for services at the Spokane County Jail. These costs have been rising at a rate that far outpaces the increase in the city's average daily population. As a result, there has been an unanticipated cost of $1 million for 2024.

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In light of these challenges, Mayor Brown presented her budget priorities at Thursday's meeting. These include investing in community safety and replenishing the city's reserves. She also discussed some administrative actions that are already underway to find efficiencies and reduce costs. These include centralizing services, eliminating vacant positions, and refinancing and restructuring debt obligations.

To further address the budget deficit, Mayor Brown announced the suspension of leave buyouts for non-represented employees this year. She assured that additional cost-saving measures will be discussed and implemented as she works with the City Council to pass the mid-biennial budget modification in late November.

Despite these challenges, Mayor Brown remains confident that they can close the additional $13 million deficit while minimizing impacts on both services for residents and staff who deliver those services. She emphasized the city's commitment to community safety and its efforts to expand and invest in behavioral health while moving towards a stronger place of fiscal responsibility.

The press release also included related documents, such as a line graph showing the rising jail costs and a budget discussion presentation. The city is determined to address its budget challenges while keeping the well-being of its residents as a top priority.

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