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Councilmembers Voice Concern About Funding If City Annexes North Highline

by Ralph Nichols [1]

If Burien is prohibited from using a 10-year state sales tax credit to help pay for capital costs, the city might not annex the North Highline unincorporated area.

“This seems like a deal breaker for me,” opined Councilman Gordon Shaw during a lengthy discussion on annexation at the Aug. 15 Burien City Council meeting.

“For years King County and the state have been telling us that it’s best for cities to provide services to unincorporated urban areas. It just seems to me that if they’re going to tie our hands on this, maybe we should just sit and wait.”

This, Shaw added, is “pretty serious. I always thought they wanted us to take over the area and manage it the way Burien does it.”

But, offered Councilman Gerald Robison, “I don’t see this as a deal breaker myself. This is a planning issue. It’s not an expense issue…. This is something that would be part of our capital planning, not something we would spend $46 million on in the next five years.”

The Berk Consulting study on annexation (download a PDF here [2]) – the platform for the council discussion – estimates that North Highline needs $46 million in capital improvements, primarily streets and sidewalks.

Robison suggested these projects would be included in the city’s six-year list of capital improvement programs, which is updated and re-prioritized annually.

City Manager Mike Martin said while the sales tax credit of $5 million a year for 10 years “covers only operating expenses, not capital costs, it is possible that funding maintenance infrastructure with the sales tax credit “may be allowed.”

Martin told council members he is exploring this possibility, including seeking an Attorney General’s opinion.

Robison also cautioned that failure to annex North Highline could have unintended consequences for Burien.

“The King County Housing Authority has burdened this area for far too long,” he said. “This concentration of poverty influences the [wider] area, and also influences some [Burien] residents about annexation of the [unincorporated] area.”

At that point, Councilwoman Rose Clark interjected that “for every dollar in South King County that is paid to King County, only part of that dollar comes back to this area.”

Calling it an “issue of fairness,” Clark said the city needs to talk to the county about providing Burien with funds to help pay for capital improvement costs if it annexes North Highline.

Jack Block Jr. said he is concerned that an area about 25 percent the size of Burien has 80 percent of the city’s existing capital needs.

“We no longer can go to the federal government or the state to pay for these projects. We have to look internally to pay for these things … I have some real concerns.

“King County walked away from North Highline and has not met its needs,” Block continued. “So where is the money [for capital improvements] going to come from? I think King County should pay up and cover a portion of the capital costs. They have a debt to North Highline.”

Earlier, Morgan Shook with Berk Consulting told the council, “We believe that even after the expiration of the sales tax credit, [annexation is] a fiscally neutral situation for the city….

“Annexation does have new costs and it does have new revenue. Once the credit expires, the city is in no better or worse situation.”

The firm’s Jay Rogers said North Highline annexation pencils out for Burien but not Seattle because “it is more expensive to extend city of Seattle services than for Burien to extend its services.”

This, Rogers noted, is largely due to the fact that services already in place in the unincorporated area – fire protection, water, sewer, and libraries – would continue to be provided by special service districts after a Burien annexation.

Seattle voters also have voted to tax themselves more to provide more human services, “which is something we do a lot less of,” Martin added.

An updated Berk presentation to the council said unincorporated North Highline has a population of about 17,400, with 6,600 housing units. The assessed property value of $1.4 billion.

“Annexation does not make balancing the [city’s] budget more difficult,” the report said. “Future City Councils will not have to make choices between higher taxes and reduced levels of service to expressly accommodate the annexation area.”

The council will next hold a special meeting on annexation issues on Aug. 22. Since it is a study session, there will be no comments from the public. However, lawmakers agreed that, after a public discussion in the first hour, they will take questions from the public.

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