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2012 Executive proposed budget address
Summary
Last year I stood before you with a budget I very much did not want to present. I said it was an imperfect budget, an unpleasant budget. Our budget was a vessel afloat, but at risk of being pulled under by the Great Recession.
We kept the ship of state afloat, but only by cutting important services and lightening the load. Ninety percent of our employees and most of our unions helped, by sacrificing their cost-of-living allowance. I pledged that by creating ongoing, annual efficiencies of three percent, we could right the ship and chart a new course toward fiscal sustainability.
Story
Madame Chair, Mr. Chair, Councilmembers, elected officials, valued employees, and the people of King County:
Last year I stood before you with a budget I very much did not want to present. I said it was an imperfect budget, an unpleasant budget. Our budget was a vessel afloat, but at risk of being pulled under by the Great Recession.
We kept the ship of state afloat, but only by cutting important services and lightening the load. Ninety percent of our employees and most of our unions helped, by sacrificing their cost-of-living allowance. I pledged that by creating ongoing, annual efficiencies of three percent, we could right the ship and chart a new course toward fiscal sustainability.
Today, I have come to these chambers with a budget of which we can all be proud.
I am pleased to present you with a budget that is balanced – a budget that is fair and just – and a budget with no further cuts to services in the General Fund. Surrounded by seas of red ink, we have made King County an island of relative stability.
The State is facing another billion dollars or more in revenue shortfalls. Cities everywhere are eliminating tens of millions of dollars in programs. At King County we are preserving services and putting aside some savings, something rare among governments across the nation.
We’ve achieved this by keeping the clear commitment to transform King County from old models of budgeting and operations to new ways of doing business.
- We are thinking strategically about the outcomes people need, not just the money we put in.
- We are managing the things within our control, so we can be ready for the unexpected.
As promised, we created efficiencies, and those efficiencies led to savings.
- The biggest efficiency is the dramatic drop in the cost of providing employee health care – $61 million below budget over two years.
- Our Healthy Incentives plan is succeeding. By helping employees improve their health, they are containing costs even beyond our high expectations.
- They are preserving services we would otherwise have to cut.
A year ago we projected our General Fund shortfall for 2012 at $20 million. Thanks to better health, and many other efficiencies large and small, that deficit has been more than wiped out. Clearly, our employees’ health and the County’s fiscal health go hand in hand.
Savings from health care and other efficiencies will preserve services across the board. Thanks to these savings we did not have to cut the equivalent of 12 Sheriff’s deputies, or seven deputy prosecutors, or 20 public health nurses, or any number of staff in the courts, and on and on in each and every agency.
My budget does support families and individuals who fall victim to domestic violence or sexual assault. For two years running the Council has rightly rushed to restore these funds when they were not included in the proposed budget. This year, I made sure to include these funds up front, just to save you the trouble, to spare us all the drama.
So we have 61 million reasons to thank our employees for partnering with us to make wellness a reality for themselves and our government. Thousands of employees made a commitment to quit smoking, to lose weight, to exercise more – and they succeeded. To thank them, I’ve invited several of those singled out as our employee Health Heroes to join us. Please stand up and be recognized. We’re also joined by the leaders of our Coalition of Labor Unions who have played an integral role in this partnership. I’d like them all to please stand and accept our thanks for helping put the county back on sound financial footing.
Our health savings are substantial. So are the efficiencies our employees have created through their spirit of collaboration and innovation. In all, our employees created nearly $32 million in new efficiencies, in scores of different ways, above and beyond health savings. We are saving hundreds of thousands of dollars a year by identifying 54 county vehicles we can do without. We are saving $2 million a year by making smarter use of office space and consolidating agencies – vacating an entire Building we own in Renton, and mothballing five floors of the Yesler Building in Seattle.
In partnership with the City of Sammamish, we are consolidating the Sheriff’s Eastside precincts into a new facility in Sammamish City Hall, increasing patrol time on the streets and saving $400,000 a year. We are moving the White Center Public Health Center to the business district in Greenbridge, providing better service to patients and saving one quarter-million dollars per year.
We modernized the heating and cooling systems in this Courthouse and the County Jail and that saves three quarter-million dollars per a year in energy, cuts greenhouse gas emissions by 3,000 tons, and saves a remarkable 7-million gallons of water per year.We’re pursuing many other energy efficiencies throughout the county, protecting both our budget and our environment.
Two efficiencies were created in criminal justice through our partnership with other jurisdictions. The city of Seattle’s long-term commitment for bed space in our downtown jail means we can make more cost-effective use of jail capacity. And on another front, we save, and the suburban cities save, by renewing their police contracts with the Sheriff’s Office – the cities get higher levels of service at lower cost than by going it alone, as validated by an independent study done for the city of Burien.
With savings from efficiencies like these, we put ourselves in position to make investments that generate even more savings to secure our future.
By investing in a county dāta center in Tukwila, we have consolidated computer servers from across all departments into a single location saving $300,000 a year. I’m especially pleased we are replacing mainframe technology that was cutting edge when we installed it – more than 30 years ago, when I was in high school.
In partnership with The Boeing Company and Group Health, we are investing in the practice of continuous improvement and employee engagement known in the business world as LEAN. Through LEAN we can eliminate barriers for our employees, redesign obsolete and cumbersome business practices, and create a laser-like focus on efficiency.
We’ve tested several LEAN projects and the results have been impressive. License tabs renewed by mail used to take 3 weeks to process and send back to drivers. We are now getting them out the door in less than five days. Taxi and limousine drivers have been waiting up to 60 days to receive their license renewals. By next month we will get that process down to under 10 days.
With that kind of return on investment, we can implement LEAN projects across the county. Protecting and improving services. Saving jobs. Getting the most for each dollar.
I pledged in my blueprint for reform that, where we can, we will have the discipline to put savings into the bank.
King County has earned its sterling triple-A bond rating thanks in large part to the fiscal oversight of our partners on the County Council. Your discipline in keeping 6 percent of our general funds in reserve, as proposed last year, helped us retain our rating.
This year I am taking another clear step to protect our triple-A rating by adding $2.7 million to our rainy day funds.At a time when the debt of even the federal government is downgraded, this strategy raises our General Fund reserves for 2012 above the 6 percent minimum that the rating agencies expect of blue-chip governments like ours.
This kind of responsible management produces great dividends. Our blue-chip rating recently saved ratepayers $70 million as we refinanced the debt of our wastewater utility. With those savings we will restart essential wastewater capital projects stalled by recession – meaning more construction jobs, putting people back to work, circulating their salaries back into our economy.
This weekend we celebrated the opening of the Brightwater Treatment Plant, and that created 3,000 family-wage jobs and $350 million in payroll during its four peak years of construction. I also propose setting aside $9.1 million in other reserves to buffer against uncertainty in future sales tax revenues. By budgeting conservatively and well within our means, we avoid the kind of roller coaster ride we see at the state level with every revenue forecast.
With $1 million in one-time savings, we can share our success through a one-time fund for human services – to invest in strengthening our non-profit partners who provide food for the needy, support for the homeless, and tools for diverse communities still struggling with this drawn-out recession.
This competitive pool of funds can provide more than 40 grants, under $25,000 each, serving communities throughout the county, to be used for capital improvement, technology, or capacity building. By investing a little we get a lot – helping agencies leverage their resources to become more efficient and productive in the way they provide for such basic needs as the regional distribution of food.
The Veterans and Human Services Levy has been shown to be well-managed and effective, and I thank voters for overwhelmingly approving its renewal. This is a strong statement by the people of King County that we will live up to our obligation to those who have served our country, and seek to help the neediest among our neighbors back to their feet.
Levy funding, and this one-time competitive fund, can not come close to addressing the unmet need for human services. Long-term, stable funding for health and human services is still needed to replace monies lost to recession, federal and state cuts, and the erosion of the county general fund over many years.
Our reforms extend to aligning our budget with our Strategic Plan, integrating Equity and Social Justice into everything we do, and piloting a product-based budget.
Most government budgets are broken down by agency and units within an agency, so that it’s not easily apparent to the public what an agency produces and what you get for your money. By turning things inside out, we are looking at the specific services the County provides as products that can be measured. For example, how do we the measure the quality, quantity, and the cost per unit of:
- A trip on an Access van.
- The issuance of a marriage license, or a building permit.
- The response to a 9-1-1 call.
By showing our budget as a catalog of products, the public can see what it’s getting, we can focus on reducing the cost of each product, and we can prioritize the products we produce to most effectively advance our strategic goals and serve our customers.
This budget pilots projects in six agencies, and my goal is to move the entire government to product-based budgeting within three years.
Achieving reform requires creative solutions like these. Just four days ago, we found a solution to move forward, to build the largest transit-oriented development on the West Coast in the North Lot of the old Kingdome, creating thousands of construction jobs, and helping revitalize Pioneer Square.
We identified an underused county asset that will now provide public parking to our ever-optimistic sports fans and stadium goers. This arrangement will generate more than $10 million for Metro Transit capital, while avoiding the construction of another parking garage on scarce downtown land. Another $10 million from the sale of the North Lot land will help us honor long-standing commitments for affordable housing and make other one-time investments.
Not all of our lines of business can rely on efficiencies alone. Two of them are in the transportation department, and the solutions for both are related. Metro Transit reforms created savings of $143 million a year, but the collapse of the sales taxes that support Metro would still have meant gutting 17 percent of our bus service.The Legislature recognized Metro’s reforms and gave King County, and only King County, a revenue tool to save transit. This Council listened to the outpouring of public support for transit, and showed the courage and fortitude to enact the Congestion Reduction Charge and save 600,000 annual hours of bus service.
But long-term reform of transit financing still resides with the state Legislature.
The Road Services Division has restructured staff and consolidated facilities to become more efficient. But revenues for the Road Levy were authorized by the state a quarter-century ago, before the advent of growth management. The success of urban annexations has left only 250,000 residents of the unincorporated areas paying for 16-hundred miles of county roads used by 2 million of us. It’s a system that hasn’t been revisited in 25 years, and it’s no longer adequate or fair.
The Governor has convened a statewide task force to examine our backlog of transportation needs, and Deputy Executive Fred Jarrett has been appointed to represent us. The transportation package that emerges must create a statewide solution for deteriorating roads in rural areas, as well for transit needs in urban areas.
As we have with transit, as we have with health care, we have shown that we can manage the things we control, but even an island of stability is not immune to the storms that blow in from off-shore. The state revenue shortfall of another $1.4 Billion will likely lead to more cuts in state support for the County’s public health and human services. We don’t know where these cuts may come so I have not anticipated them in my budget, but we do know they could be devastating for our neediest residents.
When I took office I pledged to get King County government back on sound financial footing. Today that goal is no longer on the distant horizon. To become a truly sustainable government that lives within its means, however constrained they may be, we must keep doing these two things.
- First, we must keep creating new efficiencies each year, every year, to provide the same level of services at three percent less cost.
- And second, while we’ve achieved dramatic savings in health care, we must work even more closely with our employees, their labor representatives, and health care providers, to keep bending that cost trend toward affordability.
If we can achieve those two results, we really can make King County a sustainable government, year in and year out.
And that is ultimately the star by which we must steer. Because just as our employees’ health is key to King County’s fiscal health, so is the health of our government essential to the health of our region and our economy.
By getting our operations ship-shape, we can turn our focus from internal reforms to external opportunities. As a streamlined 21st century government, we are well-positioned to promote fairness and opportunity, to help businesses create jobs, and to help neighborhoods and families thrive. Shortly, I will assemble a group of local leaders – public and private – to launch an initiative in support of the state’s aerospace partnership to position King County as the premier location for Boeing to build the re-engined 737 MAX.
I am asking the Council for quick action on a supplemental appropriation to support this effort.
We are in competition with the nation and the world. If we are to secure our future as the leader in this vital and still-growing sector – if we are to build prosperity and get people back to work – it is critical that we commit to working shoulder-to-shoulder to ensure that the 737 MAX and future generations of planes will be built right here in King County – near the little red barn at Boeing Field where it all began.
A key to that effort is our commitment in this budget to the multi-year cleanup of the Duwamish River and surrounding watershed. Working with the region to clean up contaminated properties and prevent polluted runoff to the river and Puget Sound, we will encourage reinvestment and redevelopment for job-producing airplane-part factories, bustling freight facilities, and green manufacturing.
We must also strengthen our K-12 education system, and develop a pipeline from there to our community and technical colleges and universities to train the next generation of aviation builders.
Generating new prosperity in the region will ensure continued sustainability of this government and our institutions.
President Kennedy popularized the notion that a rising tide lifts all boats. What we know today is that’s true only if we can have trust in the institutions charged with protecting the public’s interests.
Our role is not to directly create jobs, but to create the conditions and infrastructure to facilitate job growth.
And our economic recovery must be one in which all our diverse communities can share. Opportunity must be open to every young person growing up in this county, regardless of his or her family’s wealth, or race, or zip code.
I have no patience for the gridlock we have seen at the federal level over the means to revive this economy.Here at home, we have the cooperation, the vision, and the follow-through to nurture a strong and diverse regional economy.
We are proving a larger point here in King County: government can and must play a role in protecting the vulnerable, protecting the environment, investing in infrastructure, laying the foundation for economic recovery. Stable, sustainable, well-run government is an essential partner for recovery – not an impediment as some would have us believe.
So I thank you all for your partnership in running this government well, and I thank the people of King County for entrusting us with the privilege of serving.
Our practice of teamwork and respect is setting an example and building confidence across the region. We are on the right course. Whether we enjoy smooth sailing, or encounter more stormy seas, we will hew to our course and maintain our commitment and our creativity.
Thank you.
Executive Constantine’s proposed budget
2012 Proposed Budget books
- Executive Summary
- Budget Overview
- Background
- Introduction
- Debt Service
- How We Deliver
- Capital Improvement Program
- Capital Budget
- Environmental Sustainability
- Economic Growth and Built Environment
- Health and Human Potential
- Justice and Safety
- Economic and Revenue Forecast
- Appendices
2012 Budget Data Downloads
Explore the 2012 Executive Proposed Budget raw data yourself on our open data website:
