### Meeting Overview The Budget and Finance Committee met on April 27, 2026, chaired by Council Member Lisa Anderson, to consider three interconnected budget ordinances that must be approved together. Finance Director Andy Asbenson presented complex adjustments to the 2026 budget involving reserve balance reconciliations, reappropriations from 2025, and amendments that reveal the city is facing a significant structural deficit. ### Key Terms and Concepts **Reappropriations:** Funds that were budgeted in 2025 but unspent, mostly for projects already under contract that need to carry forward into 2026. **Encumbered vs. Unencumbered:** Encumbered funds are already under contract and committed; unencumbered are budgeted but not yet committed to specific contracts. **Reserve Balances:** The city's financial cushion, including emergency reserves set at 18% of general fund expenses to maintain fiscal stability. **Self-Insurance:** The city acts as its own insurance company for health benefits and workers' compensation rather than purchasing traditional insurance policies. **Alligator Chart:** A budget visualization showing revenue and expense trend lines - when the expense line (orange) is above revenue (blue), the city runs deficits that eat into reserves. **RFA (Regional Fire Authority):** A proposed separate fire district that would take over fire services, potentially saving the city $20-25 million annually. **Structural Deficit:** When ongoing expenses consistently exceed ongoing revenues, requiring use of reserves or service cuts to balance. **Contingent Loan:** A potential loan that only activates if needed, in this case up to $1.5 million to keep the Medic One fund positive. ### Key People at This Meeting | Name | Role / Affiliation | |---|---| | Lisa Anderson | Council Member, Budget & Finance Committee Chair | | Daniel Hammill | Council Member, Committee Member | | Williams | Council Member, sitting in for Michael Lilliquist | | Andy Asbenson | Finance Director | | Forest Longman | Deputy City Administrator | | Kim Lund | Mayor | ### Background Context Bellingham has been fighting structural budget deficits for year…