2020/02/26 Council Agenda Packet

Metropolitan Parks District (MPD) Establishing an MPD in Everett would require simple majority voter approval. Impact on Everett's Maximum Regular Levy Rate—The creation of an MPD would not impact the City's maximum regular levy rate. MPD Levy Rate—The maximum levy rate for an MPD is$0.75/$1,000 of Assessed Value. Based on Everett's 2020 Assessed Value, $0.75 would generate just under$15,100,000. A$0.75 levy rate increase would cost the homeowner of a median value property approximately$292 per year.The Parks Department 2020 budget and the levy rate required (levy rate equivalent)to generate that funding using the 2020 Assessed Value are as follows: 2020 Budget Item 2020 Budget Amount Levy Rate Equivalent Parks Operating Budget $10,670,000 $0.53/$1,000 of AV Parks Capital Budget 3,290,000 $0.16/$1,000 of AV Total 2020 Parks Budget $13,960,000 $0.69/$1,000 of AV Impact on the Structural Deficit—The impact of establishing an MPD on the structural deficit depends on two factors: 1. How much additional funding will be generated (initial levy rate selected) 2. How much of that additional funding will be used to supplant General Fund support of Parks versus how much will be used to increase overall Parks funding The current 2022 projected deficit is$16,550,000. If, for example,the City were to establish the MPD with an initial levy rate of$0.50,with no reduction in its regular levy rate, an additional $10 million would be generated. That amount could entirely offset the general fund's property tax allocation to the Parks Department (2020=$7,250,000), with $2,570,000 remaining to enhance Park services or capital improvements. If the entire general fund contribution were to be supplanted with MPD revenue, the 2022 projected deficit would then be reduced to$9,300,000. Additional deficit reduction could be achieved by using a portion of the remaining$2,570,000 to supplant CIP 3 Parks capital funding, which could then be shifted to Streets, for example, and used to reduce the General Fund's support of Street Improvements. The above example is just one option that could be considered. Overall,the City would have some flexibility in how to structure the application of this funding as well as the degree to which it would be used to reduce the structural deficit. Indirect Cost Impact—Creating an MPD would not remove the Parks Department from the City. Therefore, there would be no change in support departments' workload and no corresponding Indirect Cost impact. Timeline—Creating an MPD would require substantial groundwork, including organizing a grassroots organization to promote the ballot measure, determining a governance structure, initial levy rate, and messaging. Estimated timeline: in Alternative Service Delivery/Funding Models 4 1 Page