New city financial planning model

Crystil Robinson, Stanwood’s finance director, demonstrated a new financial planning model for the city council on Thursday.

While looking for a model to adopt, Robinson said she spoke with folks in Marysville, Mount Vernon and Lynnwood. The model she settled on calculates figures spanning seven years – in this case, 2010-2016.

Any adjustments are calculated immediately and tabulate projections over the next seven years, an invaluable tool for seeing the city’s future, Robinson explained.

And, it turns out, in Stanwood’s case, a little terrifying.

To demonstrate the model, Robinson input the actual 2010 budget. She assumed no property tax increases beyond the annual 1 percent and kept new construction at 2010’s conservative estimate of 10 homes.

When the model extrapolated input values across the future, Stanwood’s operating budget ended up a very sobering $3.75 million in the hole.

The graph showed the operating cash balance hitting zero in 2012. By 2013, the deficit was $740,630.

The tool can be adjusted for inflation and interest rates, and individual categories can be independently manipulated.

It can also work backwards. If, for instance, the city anticipates a $3 million expenditure in 2015, the model calculates how much should be set aside each year.

Robinson demonstrated to council that small savings in individual categories have little impact on the big picture; instead, the city is going to have to realize additional opportunities for sustainable revenue, she said.

Mayor Dianne White charged council to begin rethinking the city’s financial future.

The next council meeting is on Feb. 11, 7 p.m., in the school district’s administration building, 26920 Pioneer Highway, Stanwood.

Staff Reporter Jeremiah O’Hagan: 629-8066 ext. 125 or ohagan@scnews. com.