By Bill Sheets For the Enterprise
LYNNWOOD — Lynnwood’s ledger is poised to get a second opinion.
The City Council voted unanimously March 8 to start the process of hiring an outside consultant to lend assistance in solving the unbalanced budget and financial situation.
Mayor Don Gough’s latest projection, given to council March 15, puts it $4.8 million in the hole by the end of 2010. This multi-million dollar deficit following three previous adjustments to its two-year, 2009-10 budget. He outlined a plan to balance the budget using one-time transfers from various funds.
The economic recession, with lagging sales-tax revenues, is the primary reason for the deficit, city officials agree. Some council members, however, have said they don’t trust the mayor’s budgeting.
“The council is at a point where we feel we need someone independent of the city” to review the administration’s books, said Councilman Mark Smith, who called for the outside assistance. “There have been three budget cuts made mid-budget. Each time council was told that that would be the end of the cuts. Now we are being told there will be more cuts made to plug a hole that nobody knows the exact size of.”
The measure seeking assistance calls for a panel of three council members to evaluate what elements should be reviewed and identify some firms that could do the job. Smith, Councilman Loren Simmonds and Councilwoman Kerri Lonergan agreed to serve on the panel. The trio will consult professional municipal organizations and the city’s finance director, John Moir, to seek a professional who is savvy in municipal budgeting, Mark Smith said.
The three plan to bring their findings to a meeting March 22 where the council could give the final go-ahead for putting the consultant in place.
“I have come to believe that this is the worst recession in my lifetime,” Smith said. “It behooves us to do everything we can to mitigate its impact. There is an opportunity here to look at our business model and come away with a new way of doing business to map out a plan for the future of our city. Crisis spurs creativity. This has nothing to do with trust. We just need an independent source.”
Areas to be studied could include a review of the numbers given to the council by the administration, advice on how to balance the budget this year and on setting the two-year budget for 2011-12, Smith said.
Councilman Jim Smith suggested an accounting firm could do the work for $10,000 to $15,000 in three to four weeks.
“I feel like we’re on the way to a train wreck, and I’d like to prevent that,” Jim Smith said.
Gough did not comment on the plan at the March 8 meeting. He said earlier that projections show the city could wind up anywhere from $3 million ahead of its budget to $5 million behind, with the most likely range between $1 million and $3 million short.
Mark Smith said city finance director John Moir told him he had no problem with the outside audit.
Moir repeated this March 9.
“If (the council members) are concerned about the numbers the mayor is presenting them, then we need to proceed with it, because it will satisfy them that we’re not filtering it or spinning it any way,” Moir said. “I’m all for it because I’ve got nothing to hide.”
Councilman Ted Hikel has said he doesn’t support an audit, saying he’s satisfied with the administration’s numbers and budgeting process. Still, he voted for Monday’s resolution.
“What I voted for was to have a task group look into it,” Hikel said. “I don’t think (an audit) is necessary, personally, myself.”
Bill Sheets writes for the Herald of Everett. Enterprise editor Mina Williams also contributed to this report.