Clyde Hill News: Budget sustainability effort reboots
Mayor sets expectation for another deficit in 2026
The city’s budget sustainability task force agreed to reset its efforts after residents serving on the task force described six months of little to no progress, unanswered questions, and unmet goals at Tuesday afternoon’s meeting. Mayor Steve Friedman agreed to write new objectives for the sustainability effort and seek consensus.
Of note: the city’s full-time professional staff made clear that they have limited bandwidth to work on the city’s sustainability problem because they are busy with other work running the city. Their primary responsibility in this effort involves “provid[ing] support and analysis for Council and residents.”
Mayor Friedman also set expectations about another deficit. The sustainability effort’s reset means the city’s 2026 operating expenditures will likely exceed its revenues again. The latest draft of the 2026 budget (without a stormwater utility) shows a General Fund deficit of ~$456,000:
What else residents had to say during the meeting, and additional analysis, below.
Disclaimer: while I am a council member on the Clyde Hill City Council, I write this newsletter in my capacity as an individual resident. Any opinions expressed are my own and not necessarily the position of the city. City information and references here are from public sources. I welcome email responses — and if the topic is about city business I will respond from my city email account.
Also: some of the material excerpted in this issue comes from emails between residents and city staff, and not yet published on the city’s website. It’s not clear what steps the city will take to address transparency concerns. The video starts about 25 minutes into the meeting; residents on the task force pushed back on Mayor Friedman to make sure the recording happened. Comments from the earlier part of the meeting have been reconstructed from notes and follow-up discussion with attendees.
In brief
Starting over: After six months of little progress, Mayor Friedman agreed to reset the city’s financial sustainability effort, rewrite its goals, and seek consensus.
Deficit growing: The city is facing another big budget shortfall in 2026 (~$456K), continuing a years-long pattern of spending more than it takes in. Residents voiced frustration over confusing financial data and reluctance to consider changes to staffing or services.
Lack of clear plan: Task force members pushed for clearer goals, stronger leadership, and better project management and responsiveness to avoid more delays and finally get traction on solving the budget problem.
Information please
Mayor Friedman opened the discussion by saying “The goal of today’s meeting is a discussion on where the Financial Sustainability Task Force goes from here” and asked to hear from members of the task force.
A key concern: city staff have not been able to clearly explain the city’s services and costs. Here’s an exchange between two residents on the task force:
Jay Henningsen: So the city at this point should be able to explain [its budget and the services the city provides] to the residents in a very straightforward basis. And they have not... the budgets that we have, have different departments called different things on different schedules, so when you try to match up and align them, they don’t line up…. it’s very opaque.
Bruce Dodds: So what I don’t understand is if you’ve been clear enough about what you want, why doesn’t the city provide it to you?
Jay Henningsen: That’s why we’re here having this meeting.
Cm Sinwell explained that:
Sometimes the city will not be able to produce the information that you want. It’s just not going to happen…. [it’s] unobtainable information. (link)
Mr. Henningsen went on to say that “I’m feeling disrespected because there’s been a hand to the face on every… there’s been no response.” (link)
“I acknowledge you feel that way,” Cm Sinwell responded.
Regarding city services, Mr. Henningsen said that:
“the core services of police and fire safety, zoning enforcement, and the minimal development possible on buildable lots — that’s pretty much what we want” (link)
Later in the meeting, the Mayor talked about city services as one single inseparable group, like a monolith. Wayne Burns responded:
“I don’t think there’s been a material discussion about what services are core and what services are not core… that’s something we should talk about.” (link)
Unmet goals
After six months at work, “we’re standing on the starting line for the task force,” (link) according to Wayne Burns.
Across three top level goals — examining expenses, considering alternative ways of doing the city’s work, and raising taxes and fees — Mr. Burns reported little progress (link). For example, the city’s largest cost is people; Mr. Burns described a refusal to consider changes to non-police staffing levels.
“What we’ve done to date… clearly hasn’t worked,” (link) said Mr Burns.
Cm Sinwell spoke to how the city’s work is “not ready for prime time on the storm water [utility fees], perhaps not ready for prime time on the levy lid lift [property tax increase] in terms of having a coherent conversation.” (link)
Running out of money
Jay Henningsen said the city can’t expect to stay solvent if it continues to spend more than it takes in.
The gap between city revenues and expenditures is a long-standing issue, according to task force member Amy Kwan:
“I’ll tell you, this whole revenue is less than what we’re spending is — it’s been like this since, like, probably eight or nine years ago.… we were always saved by some big project that came in, that balance[d] our budget. So we just keep kicking the can down the road and I think we’re finally getting to the point where we can’t do that anymore” (link)
Ms Kwan, a long-time resident and former chair of the city’s Planning Commission, joined the sustainability task force after serving on the city’s Budget Advisory Committee for the last “eight or nine years.”
A review of budget data shows the city budget benefiting from a one-time American Rescue Plan Act (ARPA) grant. Before that grant, the city relied on reserves built up from “one-time revenue from the redevelopment of two Bellevue School District Schools (Chinook Middle School and Clyde Hill Elementary)” (link) in 2012 and 2018 (link).
The city has run an operating budget deficit since at least 2020, setting aside the ARPA grant:
Goal clarity, project management questions
One question directed to Mayor Friedman from a task force member was “What’s your goal? What do you want?”
The Mayor’s response: “That’s a fair question.” (link)
The Mayor offered (in my opinion) a tremendously thoughtful and articulate high-level response. It’s not clear yet how that thinking gets refined into a plan and how volunteers will effectively execute on it.
Mayor Friedman declined to assign a city employee to manage the project. The Mayor and Cm Sinwell will continue to run the effort.
Much of the discussion focused on project management issues and how to make things happen. A discussion about refining goals, for example, moved rapidly to schedules and deliverables and how to avoid continued “wandering around.” (link)
City Administrator Dean Rohla, the city’s “chief administrative officer and head of the administrative branch of the city government,” (link) said little during the meeting.
An hour into the meeting, resident Wayne Burns commented that “Dean Rohla owns the budget, and we haven’t heard anything from him today. If I was owning the budget, I’d want to have a pretty big hand in this.” (link)
During this part of the discussion, Mayor Friedman noted the need for consensus, and how consensus building “obviously is the problem [and] is why we’re talking today.” (link)
The 2026 deficit?
Wayne Burns noted that:
“a bunch of statements that were made at the end of last year when it was said that, ‘Hey, we didn’t balance the budget in ’25, but you know damn straight we’re going to balance it in ’26.’” (link)
Later in the meeting, describing what happens if Clyde Hill voters do not approve a levy lid lift (property tax increase), Mayor Friedman said:
“We’ve got no other resources and now we have a big deficit — how do we handle that? Because we will have one next year. We haven’t solved that problem effectively.” (link)
The options at that point are limited, according to the Mayor:
“What do we do if it doesn’t pass? Do we use the reserves? Do we fire people? Do we… what?” (link)
The discussion moved on to the use of the city’s reserve funds. Some members advocated spending reserves and moving slowly and cautiously toward a deficit solution because they view the situation as an emergency. Carl Picciotto, another resident on the task force, suggested that:
“Next year, I’m not sure that our situation will be any different. We’re not going to learn anything in a year or two years… so why not fix it now?” (link)
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Dean Hachamovitch