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I nil 1 <br />aLLi <br />Via <br />• mot. r 1 1 <br />•1 l • r!A 'i� .{ !:) �7'1 1F <br />ter: �• t I •�C tea t..l .1 <br />•'i C r n . tii i r <br />i{ Tiiil 1 i <br />- 'S� <br />7 ice:: tt fir 1`9, iS <br />i <br />.-r i:-r i 5.• 11 <br />��-t <br />P ii;1 .•n1 <br />,! c <br />Source: City Finance Dept. <br />Figure 5: <br />GENIFRAI G*VERNM!ENT <br />DEFICIT FORECAST <br />AS OF 9C1iOBFRE 2020 <br />Smagmeel <br />• <br />1,14442,4313-D) <br />1 _ • <br />MIS <br />ISM <br />1 <br />r <br />2741E i 512 2 <br />7 <br />c7c26 21:10_7 <br />} <br />))� <br />- 1 '- 1.� 1 '1 ir7-, <br />Every year, the City will have to undertake some mix of cuts, revenue adds, and other adjustments in <br />order to balance the General Government budget. Looking forward, the gap is greater than it has been <br />in the past six years. Key contributors are the 1% limit on property tax growth; COVID-19, which deeply <br />impacted revenues; Boeing's announcement; and pension fund obligations, including the proposal to <br />avoid deeper cuts in 2021 by deferring funding of LEOFF reserve contributions to later years. <br />Is this problem — slower revenue than expenditure growth — a new situation? In a word, no. This has <br />been the City's reality for nearly twenty years with the inception of 1-747 and the escalation of costs <br />related to employee pension fund obligations and benefit programs. Between 2010 and 2019, the City <br />made a total of $104.45 million in General Government program and service cuts, expenditure <br />deferrals, or other budget adjustments in order to balance the General Government budget each year. <br />While acknowledging these cost-cutting measures, it is also important to recognize that the City has not <br />been able to implement retirement and benefit plan reforms that would make these programs fiscally <br />sustainable. The resulting "crowding out" effect has required cuts in programs and services in the <br />absence of additional tax revenue. <br />o What are the biggest pressures on General G verrnment spending? <br />Labor costs are the largest single category of spending for General Government. Overall, employee <br />salaries and benefits will comprise 72% of General Government spending in 2021, with 19% being <br />dedicated to benefits alone. City services are by and large provided by people, the civil servants <br />employed by the City: police officers, firefighters, finance and human resources staff, city judges, urban <br />7 <br />