Budget Basics
Understanding the King County Budget
Citizens expect fiscal integrity and accountability in the use of their tax dollars. The Metropolitan King County Council meets that demand by setting priorities, funding programs consistent with those priorities, and measuring results.
The annual budget is the single most important document through which the Council sets policy for King County and oversees delivery of the services you need and expect. The Council’s Budget Leadership Team is committed to meeting its goals of fiscal integrity, accountability and transparency.
This “big picture” look will help you understand how the King County budget is built. The County Executive is scheduled to submit his 2009 Executive Proposed Budget in mid-October. The County Council will hold several public hearings and panel meetings to scrutinize the proposal and develop its own. The Council is expected to adopt the final 2009 King County Budget shortly before Thanksgiving.
Where your property tax dollar goes
Although your property tax check is paid to “King County,” only about 15 cents or 1/6th of every property tax dollar goes to County government. The County only collects the money as a function of the County Treasury. The greater portion is disbursed to schools, cities, and special taxing districts for fire service, libraries, and hospitals.
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SCHOOLS
52¢
Local school levies and state school fund |
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 LOCAL SERVICES
31¢
City and local services, including unincorporated roads, fire, libraries,
parks & hospital districts
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KING COUNTY
15¢
King County
General Fund & Regional Services |
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 PORT
2¢
Port of
Seattle
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Dedicated funds
More than four-fifths of the County budget is by law dedicated to specific programs. These “dedicated funds” cannot be used for any other purpose: bus fares can only be used to help pay for transit, sewer fees can only be used to pay for wastewater treatment
More than four-fifths of the County budget is by law dedicated to specific programs. These “dedicated funds” cannot be used for any other purpose: bus fares can only be used to help pay for transit, sewer fees can only be used to pay for wastewater treatment
2008 Adopted King County Budget
$4.92 Billion
• Enterprise funds: operating budgets for Solid Waste, Metro Transit, Wastewater, King County Airport.
• Capital improvements: acquisition of open space, expanding the Metro bus fleet.
• Special revenue: state and federal programs, such as veterans’ services, mental health, and special levies for county roads and Emergency Medical Services.
• Debt service: payments for voter-approved and other bonds.
• Internal service: information technology, facilities, finance, employee benefits, and workers’ compensation.
The General Fund
2008 Adopted General Fund Expenditures
$662.2 Million
The County general fund pays for the day-to-day operations of critical services that the public expects but which are not supported by any other revenues. The general fund represents only 14 percent of the total budget.
71 percent of the County general fund pays for law, safety and criminal justice services, such as jail operations, the Sheriff’s office, Superior Court, District Court, the Prosecuting Attorney and Public Defense.
The remainder of the general fund supports health and human services, parks and general government services.
Fiscal Challenges
Revenues
The State of Washington receives revenue from 36 separate taxing sources. Cities like Seattle have 6 separate taxing sources.
Counties have only two principal sources of tax revenue to support public services – the property tax and the sales tax – a structure that dates back to the farm-based economy of the 1850’s. This explains why the State and Seattle are able to increase programs and build revenues while the Executive’s budget proposes drawing down reserves for 2008.
King County is now the 13th most populous county in the nation, with nearly 1.8 million residents, and is the second largest provider of government services in Washington State.
By voter initiative, the amount of property taxes levied by counties can only grow 1 percent per year, plus the revenues from new construction. As a result, revenues for counties are only growing 2 to 3 percent a year, while expenses for the same level of services are rising 4 to 5 percent a year. This gap is what’s often referred to as the “structural gap” in King County’s budgeting.
Annexations and incorporations also reduce the County’s tax base, as previously unincorporated areas send their tax revenues to cities.
Federal and state governments have also made significant reductions to their support of vital human services and left other critical needs unfunded, leaving it to counties to fill the gap.
Expenditures
Providing urban-level services to unincorporated areas of the county carries high costs, yet the County’s tax structure is not designed to support those costs.
Rising costs for such things as fuel and employee health insurance hurt the County budget the same as it does for private businesses and personal households.
Policies to meet the challenge
As the policy-setting body of government, the King County Council develops and adopts long-range strategies to contain costs while funding those services the public expects. The Council is committed to meeting the goals of fiscal integrity, accountability and transparency in the use of tax dollars, as evidenced by its 2007 adopted budget that called for $24 million less in spending than proposed, while increasing general fund reserves by $3.6 million.
Since then the Council has launched several initiatives to ensure fiscal integrity and accountability:
Improving the financial and debt policies of King County – The Council appointed a four-member Financial Policies Advisory Task Force to review the financial and debt policies previously adopted by the King County Council as well as informal policies put into practice by executive agencies.
Independent oversight of major capital projects – Aimed at controlling project overruns and unforeseen expansion of project scopes, schedules and budgets on capital projects, the Council created the Office of Capital Project Oversight in the Auditor’s Office. This office issued a report and a series of recommendations to the Council’s Capital Budget Committee earlier this year.
Official economic and revenue forecasts – The Council created an Office of Economic and Financial Analysis to ensure accountability to the public through the advancement of sound financial policies based on objective and transparent financial analysis and reporting. An outside consultant is developing options for establishing a new process for producing official economic and revenue forecasts for King County to ensure sound fiscal practices.
Prudent investing of public funds – The Council created a three-member advisory panel to conduct a comprehensive review of the $4 billion King County Investment Pool. The pool invests the cash reserves of all King County agencies and nearly 100 other public entities in the county, including school, fire, sewer and water districts, and is one of the largest investment pools in the State of Washington.
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