Bellingham City Council Budget and Finance Committee
The Budget and Finance Committee approved the city's third and final budget adjustment for 2025, addressing nearly $5 million in departmental overruns and authorizing $1.1 million in interfund loans to prevent three city funds from ending the year in deficit positions. The committee unanimously approved Ordinance 24769 after making a minor amendment to increase the hearing examiner's allocation from $10,000 to $25,000. Finance Director Andrew Asbjornsen presented the year-end budget cleanup as necessary to cover potential overages across multiple departments, though he noted not all adjustments may ultimately be needed. The largest single adjustment was $1.625 million for police jail and home monitoring costs, reflecting dramatic increases in incarceration expenses that have grown from $2.8 million budgeted originally to a projected $4 million actual cost in 2025. Fire department received $1 million ($850,000 for salaries/wages and $150,000 for EMS response to Galbraith), while other departments received smaller allocations for utilities, staffing, and operational needs. The interfund loans target three struggling funds: Medic One ($300,000), Workers Compensation ($200,000), and Health Benefits ($600,000). Despite these challenges, Asbjornsen reported that increased revenues in business and occupation tax, investment income, and utility taxes, combined with departments not using their full budget authority, could reduce the city's projected deficit from the originally budgeted $4.5 million to approximately $2 million by year-end. This represents a significant improvement but still leaves the city facing ongoing structural budget challenges heading into 2026.
**AB 24769 - 2025 Budget Amendment No. 3:** - **Amendment to increase hearing examiner funding:** Passed unanimously (changed from $10,000 to $25,000) - **Main ordinance:** Passed unanimously - **Total fiscal impact:** $4.89 million in expenditures, $400,000 in revenue - **Staff recommendation:** Pass ordinance (aligned with Council action) **Key allocations approved:** - Police Department: $1.625 million for jail booking and home monitoring costs - Fire Department: $1 million ($850,000 salaries/wages, $150,000 EMS Galbraith response) - Parks & Recreation: $200,000 for utilities …
**Immediate next steps:** - Ordinance proceeds to full City Council for final approval at the December 8 evening meeting - Staff will continue monitoring year-end spending to determine actual need for authorized adjustments **2026 budget planning:** - Finance Director will schedule meeting with Sheriff Tanksley to discuss jail cost control strategies - Internal service fund rate corrections will be implemented for 2026 to address Workers Comp and Health Benefits fund shortfa…