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1 AGENDA City of Clyde Hill Council Budget-Related Study Session Special Meeting Tuesday, August 21, :00 PM Clyde Hill City Hall Page 1. CALL TO ORDER 2. ROLL CALL Welcome and thanks to the members, new and returning, of the 2019 Budget Advisory Committee Financial Study Mtg STUDY ITEMS Discussion of Financial Trends & Projections Monitoring the City's Financial Condition & Economic Trends Economic Trends Discussion of Financial Projections Overview of Financial Projections Financial Projections Discussion of Selected Performance Indicators Overview Discussion Dashboard Report Discussion of 2019 Budget Issues 2018 YE Projections School Construction Facilities Master Plan (continued) Other 2019 Items What's Next? Budget Calendar 8-18 Page 1 of 113

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3 TO: FROM: 9605 NE 24 th Street Clyde Hill, Washington Fax: Mayor & City Council Budget Advisory Committee Mitch Wasserman, City Administrator Dean Rohla, Finance Manager John Greenwood, Assistant City Administrator DATE: August 17, 2018 SUBJ: FINANCIAL STUDY SESSION PACKET Welcome to the start of the 2019 budget development process. The purpose of this meeting is to provide the Council and Budget Advisory Committee with a feel for the City s overall financial condition. To accomplish this, we ll take a look at some trends impacting that condition, view three financial projections and take a very quick peek at what to expect in the 2019 budget process. Attached are materials for your review prior to our Financial Study Session scheduled for 7:00 pm, August 21 st at the City Hall. This packet includes: Meeting Agenda #1 Clyde Hill Dashboard Report - Includes a quick glance at some financial and organizational performance measures #2 Monitoring the City s financial condition - Includes a brief explanation page along with many charts that help monitor financial trends relating to the City #3 Financial Projection Information - Includes a brief explanation page with revenue and expense projections for a worst-case, a best case and a most-likely financial scenario. The projections are here to provide us with an overall feel for the bookend possibilities of the City s financial future. Don t take the 2018/2019 projections as numbers you can specifically count on just yet. It s still real early in our budget development and we will be spending more time on pin pointing those numbers in the next month. BUDGET CALENDAR: We included a complete budget calendar for your information but would like to point out the following important dates. There are four meetings critical to the budget development process all scheduled for 7:00 PM at City Hall. Thurs Economic Trends - 5 yr Projection Study 2019 Overview Tues Draft Budget Study Session Tues Preliminary Budget Hearing Tues Adoption of Final 2019 Budget Please let us know if there are any questions regarding the attached information. We have a great deal of financial information available and we love to share it Dean can be reached at dean@clydehill.org, John at johng@clydehill.org and Mitch at mitch@clydehill.org. Page 3 of 113

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5 9605 NE 24 th Street Clyde Hill, Washington Fax: Monitoring the City s Financial Condition 2019 Budget Development Process Brief Explanation Financial Policy Statement #2 for the City states, Continue to review financial trends relating to the City s finances and operations. As one of our first steps in the budget process, City staff updates the trend monitoring information for review by all the participants involved with developing the next year s budget. Using the City s past performance to monitor the City s current financial condition is an important tool to understand economic trends impacting the City s finances. Definition For our purposes, financial condition means the ability of the City to generate enough operating revenues to provide services at the level and quality that residents of Clyde Hill expect, without incurring deficits. Materials for Review The following documents are for your review: Document Index Financial Condition Monitoring Charts (provides a cross reference number to the specific chart listed on the index for a quick review). A series of documents showing historical data in chart or table format through the budgeted 2018 year end number to study current trends. Concluding Remarks Based on the 2018 budget, the City s General Fund is projected to finish fiscal year 2018 with a surplus of around $436,000. Each of the City s financial condition indicators has their own unique story to tell and the associated charts are designed to help relay that information. City staff continues to diligently hold down expenses at every opportunity. Please feel free to discuss any questions, suggestions or concerns involving any of this information during the upcoming budget study session. Page 5 of 113

6 9605 NE 24 th Street Clyde Hill, Washington Fax: Document Index Financial Condition Monitoring 2019 Budget Development Process Snapshot of Current Financial Picture Actual Operating Revenues vs 2018 Budget Operating Revenues Actual Operating Expenditures vs 2018 Budget Operating Expenditures General Indicators 3. City Population 4. Number of Housing Units 5. Inflation Rate (CPI-W for Seattle) Since Employee Authorized Position Count 7. Authorized Full Time Employees (FTEs) with Per Capita 8. Total City Assessed Valuation Since 1998 (In Millions) 9. Average Assessed Valuation per Housing Unit with Rate of Change 10. Comparison of 2018 Property Tax Rates for Cities & Towns in King County Property Tax Distribution 12. Comparison of 2018 Property Tax Rates for Selected Cities 13. Comparison Property Tax Information for Selected Neighboring Cities & Town Clyde Hill Property Tax Information 15. Number of New Home Construction Permits & Total Valuation Revenue Indicators 16. Total Operating Revenues Actual Dollars compared to Constant Dollars 17. Total Oper Rev Actual Dollars compared to Constant Dollars (back to 1998) 18. Property Tax Revenues Actual Dollars compared to Constant Dollars 19. Property Tax Revenues Actual Dollars compared to Constant Dollars back to Sales Tax Revenues - Actual Dollars compared to Constant Dollars 21. Utility Taxes & Franchise Fees Actual Dollars compared to Constant Dollars 22. Rate History for Utility Taxes & Franchise Fees Rate History 23. Development Revenue Actual Dollars compared to Constant Dollars 24. Dev Revenues - Actual Dollars compared to Constant Dollars (Back to 1998) 25. Motor Vehicle Related Revenue Actual Dollars compared to Constant Dollars 26. State & Federal Shared Revenues Actual Dollars compared to Constant Dollars 27. Yarrow Point Police Contract Revenue - Actual Dollars compared to Constant Dollars Page 6 of 113

7 Document Index Financial Condition Monitoring 2018 Budget Development Process Page 2 of Fines and Forfeiture Revenue Actual Dollars compared to Constant Dollars 29. Investment Interest Revenue Actual Dollars compared to Constant Dollars 30. Cash and Investment Report as of July 31, Wireless Comm Facility Revenues - Actual Dollars compared to Constant Dollars 32. Other Operating Revenue - Actual Dollars compared to Constant Dollars 33. Elastic Revenue - Actual Dollars compared to Constant Dollars (Back to 1998) 34. Elastic Revenue as a % of Total Operating Revenue (Back to 1998) 35. Real Estate Excise Tax Revenue Actual Dollars compared to Constant Dollar 36. Year Over Year Comparison of Average Sales Price to Number of Homes Sold (8/18) 37. Criminal Justice Sales Tax Revenue Actual Dollars compared to Constant Dollars Expenditure Indicators 38. Total Operating Expenditures Actual Dollars compared to Constant Dollars 39. Total Operating Expenditures Actual Dollars compared to Constant Dollars (1998) 40. General Government Services Expenditures - Act Dollars compared to Constant Dollars 41. Law Enforcement Expenditures - Actual Dollars compared to Constant Dollars 42. Public Works/Building Dept Expenditures - Act Dollars compared to Constant Dollars 43. Total Salaries & Benefits Actual Dollars compared to Constant Dollars 44. Total Salaries & Benefits as a % of Operating Expenditures 45. Personnel Benefits as a % of Salaries 46. Personnel Benefits as a % of Total Operating Expenditures 47. Contracted Services Actual Dollars compared to Constant Dollars 48. Dispatch Expenditures Actual Dollars compared to Constant Dollars 49. Fire Protection & Medic One Expenditures Actual Dollars to Constant Dollars 50. Legal Expenditures Actual Dollars compared to Constant Dollars 51. Insurance Expenditures Actual Dollars compared to Constant Dollars 52. Operating Supplies & Services Actual Dollars compared to Constant Dollars 53. Utilities Actual Dollars compared to Constant Dollars 54. Repairs & Maintenance Actual Dollars compared to Constant Dollars 55. Minor Equipment Actual Dollars compared to Constant Dollars 56. Other Operating Expenditures Actual Dollars compared to Constant Dollars 57. Clyde Hill Roadway & Total Capital Expenditures Over Time 58. Total City Expenditures - Actual Dollars compared to Constant Dollars Overall Resources Available Indicators 59. General Fund (Operating Fund) Surplus or Deficit 60. General Fund (Operating Fund) Surplus or Deficit back to Total City Fund Balances 62. Reserve Fund Ending Balance (Since 1998) 63. Total Operating Revenues compared to Total Operating Expenditures 64. Total City Revenues compared to Total City Expenditures Page 7 of 113

8 2018 Budget General Fund Revenues Wireless Comm Fac Leases, $222,125, 5% Sales Tax, $590,000, 12% MVFT, $70,000, 1% State Shared Rev, $41,500, 1% Property Taxes, $1,013,000, 22% Invest Income, $125,500, 3% Misc. Op Rev, $40,000, 1% Interlocal Services Provided, $421,000, 9% Utility Tax & Franch Fees, $830,500, 18% Develop Revenues, $1,280,000, 27% Fines and Penalties, $62,500, 1% 2008 Actual General Fund Revenues (for comparison with 2018 Budget GF Revenues MVFT, $64,338, 2% Property Taxes, $806,718, 26% State Shared Rev, $36,866, 1% Misc. Op Rev, $12,853, 0% Interlocal Services Provided, $324,302, 10% Develop Revenues, $434,707, 14% Wireless Comm Fac Leases, $117,573, 4% Fines and Penalties, $126,208, 4% Sales Tax, $460,721, 15% Invest Income, $163,198, 5% Utility Tax & Franch Fees, $594,249, 19% Page 8 of 113

9 2018 Budget General Fund Expenditures Public Works, $842,250, 20% General Gov't Services, $1,081,400, 25% Fire Control & Medic One, $652,975, 15% Police Services, $1,683,225, 40% 2008 Actual General Fund Expenditures (for comparison with 2018 Budget GF Expenditures) Public Works, $582,544, 19% General Gov't Services, $537,986, 18% Fire Control & Medic One, $611,309, 20% Police Services, $1,311,502, 43% Page 9 of 113

10 City of Clyde Hill Population 3,200 State shared revenues from Liquor Board profits, Motor Vehicle Fuel Taxes & Criminal Justice programs are distributed to cities based on population while City expenditures for Fire and Animal Control are in part based on population 2020 Census, Staff projects population to decrease due to increase in unoccupied residences. 3,000 Census 2010 was 139 more people than the 2010 estimate used by the State to distribute 2010 revenues based on population (the State's low estimate was costing the City revenue) 2,800 Page 10 of 113 2, Bdg City Population 2,900 2,895 2,830 2,790 2,780 2,795 2,810 2,805 2,815 2,984 2,985 2,980 2,980 2,995 3,020 3,060 3,015 3,045 Source: Office of Financial Management

11 City of Clyde Hill Number of Housing Units 1,110 1,105 1,100 1,095 Revenue streams related to housing (i.e. property taxes, sales tax from construction, utility taxes & franchise fees, building/mechanical/street opening permits & plan check fees, etc.) are essential for providing basic municipal government services (i.e. police, fire, streets, building code enforcement, etc.) 2010 is based on U.S. Census data & then State OFM estimates # of unoccupied homes, vacant or under construction 1,090 1,085 1,080 1,075 Page 11 of 113 1, Bdg # of Housing Units 1,083 1,086 1,076 1,075 1,084 1,084 1,087 1,081 1,089 1,099 1,099 1,098 1,097 1,099 1,099 1,092 1,081 1,084 Source: 2010 is U.S. Census Data & then estimated by State Office of Financial Management (OFM)

12 Inflation Rate (CPI-W for Seattle) Since Year % 4.0% The current Police Collective Bargaining Agreement (CBA) runs through 12/31/20. The written agreement includes a cost of living increase based upon the yearto year change in the June CPI W for Seattle that was 3.6% for June, % 2.0% 1.0% Page 12 of % Bdg Inflation Rate 3.7% 3.6% 1.8% 1.5% 1.6% 3.0% 3.7% 3.8% 4.5% 0.4% 0.8% 3.2% 2.5% 1.2% 1.9% 0.9% 2.3% 3.3% 3.6% Source: CPI-W "Annual Average" for Seattle per Municipal Research and Services Center (MRSC)

13 Employee Authorized Position Count City of Clyde Hill, Washington As of January 1, 2018 Purpose: to account for all employee positions for prior years, the current year and the new budget year. Note: No staffing level changes are part of the 2018 budget. The big challenge related to staffing though in the 2018 budget is the anticipated retirement of 2-3 senior staff members that collectively have over 75 years of service to Clyde Hill. The 2018 Budget includes $122,500 of "Retirement / Succession Costs" for the job overlap of new replacement people and the buyout of any unused vacation benefit. The removal of these one time costs would reduce the budgeted $176,500 or 6.9% increase in salary / benefits to a more modest and below CPI number of $54,000 or 2.1% Department Actual 2015 Actual 2016 Actual 2017 Budget 2018 City Administrator City Administrator City Administrator City Administrator N/A Assistant City Administrator Assistant City Administrator Assistant City Administrator Finance Manager (1/2) Finance Manager (1/2) Finance Manager (1/2) Finance Manager (1/2) General Gov't Deputy City Clerk Deputy City Clerk Deputy City Clerk Deputy City Clerk Dep. City Clerk/Code Enforce (2/3) Dep. City Clerk/Code Enforce (2/3) Dep. City Clerk/Code Enforce (2/3) Dep. City Clerk/Code Enforce (2/3) FTE = 3.16 FTE = 4.16 FTE = 4.16 FTE = 4.16 Police Chief Police Chief Police Chief Police Chief Lieutenant Lieutenant Lieutenant Lieutenant Finance Manager (1/2) Finance Manager (1/2) Finance Manager (1/2) Finance Manager (1/2) Police Police Records Specialist Police Records Specialist Police Records Specialist Police Records Specialist 7 Patrol Officers 7 Patrol Officers 7 Patrol Officers 7 Patrol Officers FTE = 10.5 FTE = 10.5 FTE = 10.5 FTE = 10.5 Fire Contracted with City of Bellevue Contracted with City of Bellevue Contracted with City of Bellevue Contracted with City of Bellevue Public Works Director/Engineer Public Works Director/Engineer Public Works Director/Engineer Public Works Director/Engineer Public Works Admin Dep. City Clerk/Code Enforce (1/3) Dep. City Clerk/Code Enforce (1/3) Dep. City Clerk/Code Enforce (1/3) Dep. City Clerk/Code Enforce (1/3) FTE = 1.33 FTE = 1.33 FTE = 1.33 FTE = 1.33 Building Inspector/Crew Member Building Official / Inspector Building Official / Inspector Building Official / Inspector Public Works Crew * 2 Public Works Crew Members 3 Public Works Crew Members 3 Public Works Crew Members 3 Public Works Crew Members Page 13 of 113 FTE = 3.00 FTE = 4.00 FTE = 4.00 FTE = 4.00 (Student(s) employed in the summer) (Student(s) employed in the summer) (Student(s) employed in the summer) (Student(s) employed in the summer) Total FTE

14 Authorized FTEs Per Capita th police officer was authorized with the 2006 budget Assistant City Administrator and 3rd Public Works crew member were authorized with the 2016 budget Authorized FTEs Per Capita Page 14 of Bdg Authorized FTEs Per Capita FTEs Columns represent "Authorized FTEs" & Line represents "Per Capita" or the number of residents per City employee 130

15 Total City Assessed Value Since 1998 (In Millions) $3,000 $2,500 Property Tax assessment values are determined by the King County Department of Assessment $2,000 (In Millions of Dollars) $1,500 $1,000 $500 Page 15 of 113 $ Total City AV ,068 1,171 1,304 1,578 1,786 1,436 1,264 1,272 1,276 1,643 1,945 2,074 2,268 2,552

16 Average Assessed Value per Housing Unit with Rate of Change $3,000 40% $2,500 30% 20% Avg AV per Household $2,000 $1,500 $1,000 10% 0% Rate of Change -10% $500-20% Page 16 of 113 $ Bdg Avg AV per Household $675 $787 $898 $925 $986 $1,081 $1,199 $1,460 $1,640 $1,307 $1,150 $1,159 $1,164 $1,495 $1,770 $1,899 $2,098 $2,355 Rate of Change 12.6% 16.5% 14.1% 3.0% 6.6% 9.6% 11.0% 21.7% 12.3% -20.3% -12.0% 0.8% 0.4% 28.5% 18.4% 7.3% 10.5% 12.2% (In Millions of Dollars) -30%

17 2018 City Property Tax Rates In King County Page 17 of 113 Tukwila Seatac Snoqualmie Seattle Auburn Black Diamond Sammamish Bothell Kent Newcastle Skykomish Milton Normandy Park Duvall Shoreline Kenmore Enumclaw North Bend Algona Pacific Des Moines Redmond Burien Kirkland Renton Covington Carnation Lake Forest Park Federal Way Issaquah Maple Valley Bellevue Beaux Arts Mercer Island Woodinville Medina Yarrow Point Clyde Hill Hunts Point

18 2018 Property Tax Distribution for Clyde Hill, Washington Taxpayers Port of Seattle 1.6% Clyde Hill 4.6% Regional Transit 2.7% King County Flood Zone 1.2% King County 15.5% Bellevue Schools 32.7% EMS 2.8% King County Library 4.8% State Schools 34.1% Page 18 of 113

19 Comparison of 2018 Property Tax Rates for Selected Cities Page 19 of Clyde Hill Medina Mercer Island Kirkland Bellevue Newcastle Yarrow Point Total $ Total $ Total $ Total $ Total $ Total $ Total $ Local Schools Hospital City Levy KC Library Regional Transit Authority KC Flood Dist EMS Port of Seattle King County State Schools

20 Comparison Property Tax Information for Selected Neighboring Cities & Town City of Clyde Hill, Washington 2018 Tax Roll Purpose: to compare selected neighboring cities and one town to Clyde Hill for property taxes paid based on the average assessed value of a home in Clyde Hill during $ ,361,173 Clyde Hill (Bellevue SD) Medina (Bellevue SD) Mercer Island (Mercer Island SD) Kirkland (Lake Washington SD) Bellevue (Bellevue SD) Newcastle (Issaquah SD) Yarrow Point (Bellevue SD) Property Tax - Taxing Districts Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid City Levy $ $ 1, $ 2, $ 2, $ 2, $ 3, $ 1,147 State Schools - Regular (Part 1) $ 4, $ 4, $ 4, $ 4, $ 4, $ 4, $ 4,507 State Schools - McCleary (Part 2) $ 2, $ 2, $ 2, $ 2, $ 2, $ 2, $ 2,384 State Schools $ 6, $ 6, $ 6, $ 6, $ 6, $ 6, $ 6,890 Local School District Special Levy $ 2, $ 2, $ 3, $ 2, $ 2, $ 4, $ 2,498 Local School Building Fund Levy $ $ $ 1, $ 1, $ $ 1, $ 977 Local School Bond Fund Levy $ 3, $ 3, $ 1, $ 2, $ 3, $ 3, $ 3,139 Local Schools $ 6, $ 6, $ 5, $ 7, $ 6, $ 8, $ 6,614 King County - Reg Levies - Non-Vote $ 1, $ 1, $ 1, $ 1, $ 1, $ 1, $ 1,632 King County - Reg Levies - Lid Lift $ 1, $ 1, $ 1, $ 1, $ 1, $ 1, $ 1,205 King County - Transportation $ $ $ $ $ $ $ 105 King County - Ferry District $ $ $ $ $ $ $ 26 King County - Bond Fund Unlimited $ $ $ $ $ $ $ 77 King County - Conservation Futures $ $ $ $ $ $ $ 89 King County $ 3, $ 3, $ 3, $ 3, $ 3, $ 3, $ 3,134 Port of Seattle $ $ $ $ $ $ $ 319 EMS $ $ $ $ $ $ $ 565 Hospital $ $ $ $ $ $ $ - King County Flood Zone $ $ $ $ $ $ $ 253 Regional Transit Authority $ $ $ $ $ $ $ 537 KC Library $ $ $ $ $ $ $ - Page 20 of 113 TOTAL $ 20, $ 20, $ 20, $ 23, $ 21, $ 25, $ 19,460 Please Note: Most of the cities and one town used in this comparison have multiple levy code districts within their jurisdiction. This means some homes in a certain jurisdiction might pay for something that others in the same jurisdiction do not. Also, homes in certain jurisdictions might pay for different local school districts (e.g. some Bellevue homes pay for Lake Washington School District while the majority pay for Bellevue School District). Levy codes used for each city or town listed were: Clyde Hill (1053), Medina (1836), Mercer Island (1031), Kirkland (1806), Bellevue (0330), Newcastle (1869) & Yarrow Point (2650).

21 Property Tax Information City of Clyde Hill, Washington Through 2018 Tax Roll Tax Paid Based on "Average Home" Assessed Value: $ 1,899,010 $ 2,077,145 $ 2,361,173 Purpose: to provide the "average" Clyde Hill resident with a detailed breakdown of how their property tax dollars are calculated and distributed to the City and the other 8 taxing districts receiving their property tax payments Tax Year 2017 Tax Year 2018 Tax Year Taxing District Tax Rate Tax Paid Tax Rate Tax Paid Tax Rate Tax Paid Dollar Amount Change in 2018 Percentage Change With Previous Year Share of 2018 Prop Taxes Paid State Schools $4, $4, $6,890 $2, % 34.1% State Schools $4, $4, $6,890 $2, % 34.1% Bellevue School District 405 Special Levy $2, $2, $2,498 $ % 12.4% Bellevue School 405 Building Fund Levy $ $ $977 $1 0.1% 4.8% Bellevue School 405 Bond Fund Levy $2, $2, $3,139 $ % 15.5% Bellevue Schools $5, $6, $6,614 $ % 32.7% King County - Regular Levies - Non-Voted $1, $1, $1,632 $56 3.6% 8.1% King County - Regular Levies - Lid Lift $ $1, $1,205 $ % 6.0% King County - Transportation $ $ $105 $2 1.6% 0.5% King County - Bond Fund Unlimited $ $ $77 $2 2.7% 0.4% King County - Conservation Futures $ $ $89 $3 3.4% 0.4% King County - Marine District $ $ $26 $1 2.9% 0.1% King County $2, $2, $3,134 $ % 15.5% Port of Seattle $ $ $319 $1 0.2% 1.6% EMS $ $ $565 $19 3.5% 2.8% King County Flood Zone $ $ $253 $9 3.7% 1.3% KC Library $ $ $973 $35 3.8% 4.8% Regional Transit Authority (RST) $ $ $537 $18 3.4% 2.7% Clyde Hill $ $ $937 $10 1.0% 4.6% Page 21 of 113 TOTAL $15, $16, $20,223 $3, % 100.0% Please Note: For the 2018 Tax Roll, the City Council decided for the 7th year in a row to not take the allowed 1% property tax increase over the previous year and for the 3rd year in a row, the City Council decided not to take new construction either. This decision helps to bring the City's total "banked capacity" to $97,857 (can be levied when needed in the future with a simple majority vote of the City Council).

22 Number of New Home Construction Permits & Total Valuation $50 25 $45 $40 20 $35 Permit Value (In Millions) $30 $25 $20 $ No. of New Homes $10 5 $5 Page 22 of 113 $ Bdg New Home Val $8.1 $15.6 $13.9 $24.1 $29.7 $30.1 $33.7 $14.2 $2.0 $9.3 $13.8 $15.3 $23.0 $13.5 $34.4 $36.0 $ New Home Count Line shows the # of new home permits issued & columns show the total new home valuations 0

23 Total Operating Revenue - Actual Dollars compared to Constant Dollars $5,000 $4,500 $4,000 $3,500 The "Big Four" operating revenues include: 1) Property Tax, 2) Sales Tax, 3) Utility Tax / Franchise Fee / Business Tax, & 4) Development Revenues (i.e. Building Permits & Plan Check Fees) (In Thousands of Dollars) $3,000 $2,500 $2,000 $1,500 $1,000 $500 Page 23 of 113 $ Bdg Constant Dollars 1,630 1,617 1,752 1,871 1,942 1,992 1,780 1,671 1,755 1,662 1,998 1,921 1,751 2,099 2,100 2,242 2,199 Actual Dollars 2,408 2,425 2,668 2,935 3,160 3,365 3,142 2,961 3,134 3,062 3,776 3,674 3,414 4,129 4,225 4,661 4,696 Note: 2012 included $567,400 one-time revenue from the Chinook Middle School Project

24 Total Operating Rev - Actual Dollars compared to Constant Dollars Back to 1998 $5 $5 $4 $4 Early 2000s Recession officially started in March, 2001 and lasted 8 months until November, 2001; primarily attributed to the dot.com bubble collapse, the 9/11 terrorist attacks, and the accounting scandals (most notable was Enron) The housing bubble collapse is the primary reason given for the "Great Recession" that officially started in December, 2007 and lasted until June, 2009 (In Millions of Dollars) $3 $3 $2 $2 $1 $1 Page 24 of 113 $ Bdg Constant Dollars Actual Dollars Note: 2012 includes $567,400 in one-time revenue from the Chinook Middle School Project

25 Property Tax Revenues - Actual Dollars compared to Constant Dollars $1,500,000 $1,250,000 Initiative 747 Limiting Property Tax Increases to 1% was approved by Voters in Nov'01 (2002 Budget impact) The City used all "Banked Capacity" for the 2009 Tax Roll The 2012 to 2018 Budgets did not include the allowable 1% levy increase and 2016 to 2018 did not include new construction (allowable levies not taken can be "banked" for future use by the City $1,000,000 $750,000 $500,000 $250,000 Page 25 of 113 $ Bdg Constant Dollars 467, , , , , , , , , , , , , , , , ,312 Actual Dollars 690, , , , , , , , , , , , ,255 1,012, ,641 1,017,492 1,013,000

26 Property Tax Revenues - Actual Dollars compared to Constant Dollars $1,500,000 $1,250,000 The City used all "Banked Capacity" for the 2009 Tax Roll The 2012 to 2018 Budgets did not include the allowable 1% levy increase and 2016 to 2018 did not include new construction (allowable levies not taken can be "banked" for future use by the City $1,000,000 $750,000 $500,000 $250,000 Page 26 of 113 $ Bdg Constant Dollars 508, , , , , , , , , ,312 Actual Dollars 901, , , , , ,255 1,012, ,641 1,017,492 1,013,000 Note: 2018 is Budgeted Year End

27 Sales Tax Revenues - Actual Dollars compared to Constant Dollars $800,000 $700,000 $600,000 $500,000 New Streamlined Sales Tax Law was implemented July 1, 2008 (although most of this spike in sales tax was due to the tail end of the housing construction boom) New City Business License Ordinance was implemented April 1, 2010 (goal is to help tax filers code their sales tax dollars to Clyde Hill rather than by mistake to the City of Bellevue) One time Sales Tax money from $40.0M Chinook Middle School Project $400,000 $300,000 $200,000 $100,000 Page 27 of 113 $ Bdg Constant Dollars 94, , , , , , , , , , , , , , , , ,253 Actual Dollars 140, , , , , , , , , , , , , , , , ,000 Note: The City received $347,008 in sales tax from Nov'12 through Jan'15 as a result of the Chinook MS Project

28 Utility Taxes / Franchise Fees / Bus License - Actual Dollars compared to Constant Dollars $900,000 $800,000 Please see the City of Clyde Hill Rate History Sheet for Utility Taxes & Franchise Fees for details $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 Page 28 of 113 $ Bdg Constant Dollars 336, , , , , , , , , , , , , , , , ,861 Actual Dollars 497, , , , , , , , , , , , , , , , ,500

29 Rate History for Utility Taxes & Franchise Fees City of Clyde Hill, Washington Year End Ordinance Electric Utility Tax Rate Natural Gas Utility Tax Rate Solid Waste Utility Tax Rate Cable TV Utility Tax Rate Loc Access Telephone Utility Tax Rate Long Dist Telephone Utility Tax Rate Wireless Telephone Utility Tax Rate Solid Waste Franchise Fee Rate Cable TV Franchise Fee Rate Water Franchise Fee Rate Sewer Franchise Fee Rate Page 29 of , 606, % 6.4% 10.0% 10.0% 6.4% 6.4% N/A N/A 5.0% 10.0% 10.0% % 6.25% 10.0% 10.0% 6.25% 6.25% N/A N/A 5.00% 10.00% 10.00% & % 6.05% 10.0% 10.0% 6.05% 6.05% N/A 5.5% 5.0% 10.0% 10.0% 1991 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% N/A 5.5% 5.0% 10.0% 10.0% 1992 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% N/A 5.5% 5.0% 10.0% 10.0% 1993 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% N/A 5.5% 5.0% 10.0% 10.0% 1994 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% N/A 5.5% 5.0% 10.0% 10.0% & % 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% 1996 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% % 6.0% 8.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 8.0% 8.0% 1998 No Change 6.0% 6.0% 8.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 8.0% 8.0% % 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% 2000 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% % 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% 2002 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% 2003 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% 2004 No Change 6.0% 6.0% 10.0% 10.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% % 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 5.5% 5.0% 10.0% 10.0% % 6.0% 4.0% 4.0% 4.0% 0.0% 6.0% 5.5% 5.0% 10.0% 10.0% % 6.0% 4.0% 4.0% 4.0% 0.0% 6.0% 5.5% 5.0% 8.0% 8.0% 2008 No Change 6.0% 6.0% 4.0% 4.0% 4.0% 0.0% 6.0% 5.5% 5.0% 8.0% 8.0% % 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2010 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2011 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2012 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2013 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2014 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2015 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2016 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2017 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0% 2018 No Change 6.0% 6.0% 4.0% 9.0% 6.0% 0.0% 6.0% 5.5% 5.0% 9.0% 9.0%

30 Development Revenue - Actual Dollars compared to Constant Dollars $1,250,000 $1,000,000 $750,000 Dec'02 Budget Decision Fees were revised to remove the discount for higher end projects in response to I 695 Dec'08 Budget Decision Fees were increased 12.5% in response to falling revenues due to the recession Includes Plan Check Fees & Building Permit for $40.5M Chinook Middle School Project $500,000 $250,000 Page 30 of 113 $ Bdg Constant Dollars 199, , , , , , , , , , , , , , , , ,328 Actual Dollars 294, , , , , , , , , , , , , , ,185 1,277,50 1,280,00

31 Development Revenue - Actual Dollars compared to Constant Dollars (Back to 1998) $1,500 In Thousands of Dollars $1,250 $1,000 $750 $500 The housing development boom that started to take off in Clyde Hill in the late 1990's was able to mask over the negative impact of I 695 (i.e. $30 car tabs initiative) that cost the City approximately $250,000 per year in Official Recession Dates were Mar'01 to Nov'01 (9 months) Official Recession Dates were Dec'07 to Jun'09 (19 months long with the economic impact coming slightly later in the Seattle area than the rest of the country) $40.5M Chinook MS Project $250 Page 31 of 113 $ Bdg Constant Dollars Actual Dollars ,278 1,280 Note: 2018 is Budget (includes Clyde Hill Elementary School Project)

32 Motor Vehicle Related Revenues - Actual Dollars compared to Constant Dollars $100,000 $90,000 $80,000 The City lost approximately $27,000 per year when Initiative 776 was passed by Statewide Voters in Nov'02 to repeal the King County Local Option Vehicle License Fees Cities receive a per capita share of the multi modal funds & the increase in fuel tax as a result of 2ESSB 5987 (2015). Provides for direct distributions to be phased in from FY $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 Page 32 of 113 $ Bdg Constant Dollars 60,005 40,736 38,269 37,995 39,705 40,100 36,461 34,430 34,135 33,711 32,277 32,209 31,529 32,079 33,934 33,420 32,776 Actual Dollars 88,682 61,087 58,280 59,602 64,613 67,724 64,338 61,022 60,972 62,125 60,992 61,605 61,471 63,111 68,284 69,488 70,000

33 State & Federal Shared Revenues - Actual Dollars compared to Constant Dollars $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 Impact of Initiative 695 ($30 car tabs) started in Year 2000 (loss of approximately $250,000 for the City) followed by two years of "back fill" from the Legislature and then nothing to compensate the City for the lost revenue Reimbursement of the City's costs from the Dec'08 Snow Event (Presidential declared disaster) was received from FEMA & the State in 2009 Includes reimbursement from FEMA and the State for the Jan'12 Snow & Ice Storm (Presidential Disaster The City participated in the L&I Stay at Work Program Liquor Excise Tax appears to have recovered from the temporary decline due to the liquor privatization initiative (I 1183) passed in Nov'11 $40,000 $20,000 Page 33 of 113 $ Bdg Constant Dollars 117,977 19,747 21,285 22,770 19,172 20,552 20,892 25,736 23,288 21,131 34,978 17,459 18,091 20,537 20,161 26,292 18,916 Actual Dollars 174,359 29,613 32,414 35,719 31,198 34,710 36,866 45,613 41,598 38,941 66,096 33,394 35,271 40,404 40,569 54,666 40,400

34 Yarrow Point Police Contract Revenues - Actual Dollars compared to Constant Dollars $500,000 $400,000 Per contractual agreement through 2024, The Town of Yarrow Point shares 25% of the cost of providing a 24 X 7 fully trained & equipped Police Department for the benefit of both communities $300,000 $200,000 $100,000 Page 34 of 113 $ Bdg Constant Dollars 147, , , , , , , , , , , , , , , , ,123 Actual Dollars 218, , , , , , , , , , , , , , , , ,000

35 Fines and Penalty Revenues - Actual Dollars compared to Constant Dollars $250,000 $200,000 $150,000 For most of 2004, the City only had 4 active duty patrol officers due to turnover Last time the City had 7 full time police officers on duty was between Oct 2007 and Jan 2009 Sprint Wireless paid penalties in the amount of $99,741 for not paying their 2015 lease payments on time and the developer at nd paid penalties in the amount of $47,225 for not complying with their written agreement $100,000 $50,000 Page 35 of 113 $ Bdg Constant Dollars 66,625 62,246 40,522 44,675 51,525 65,851 71,522 65,168 63,722 54,416 37,191 39,469 35, ,114 69,880 47,155 29,264 Actual Dollars 98,465 93,344 61,710 70,080 83, , , , , ,281 70,277 75,491 69, , ,615 98,046 62,500

36 Investment Interest Revenue - Actual Dollars compared to Constant Dollars $300,000 $250,000 $200,000 The Washington State Local Government Investment Pool (LGIP) earnings rate was below 2% from Feb'02 until Dec'04 LGIP net earnings rate has been below 2% since Dec '08 & is 1.99% as of Jul'18 $150,000 $100,000 $50,000 Page 36 of 113 $ Bdg Constant Dollars 90,201 43,437 27,890 25,102 85, , ,031 92,485 44,730 15,905 10,766 5,940 5,946 4,670 6,593 17,760 38,892 58,762 Actual Dollars 130,990 64,197 41,824 38, , , , ,198 79,277 28,409 19,840 11,224 11,372 9,105 12,971 35,737 80, ,500

37 The Cash and Investment Report City of Clyde Hill, Washington As of July 31, 2018 Purpose: To illustrate what funds currently account for the City's cash and investments and also where the financial resources are located. The Local Government Investment Pool (LGIP) net earnings rate as of 07/31/2018 was % (Jan'18 = %). Fund Accounting: Depository Location; General Fund $ 1,060,585 US Bank Checking - Operating $ 987,055 Reserve Fund 3,910,393 US Bank Checking - Payroll 45,938 Projects Fund 3,889,337 LGIP - State Treasurers Office 8,158,403 Trust & Agency Fund 331,406 Other - Total $ 9,191,721 Petty Cash & Change Fund 325 Total $ 9,191,721 Fund Accounting for Cash & Investments as of June 30, 2018 Trust & Agency Fund, 331,406, 4% General Fund, $1,060,585, 11% Projects Fund, 3,889,337, 42% Reserve Fund, 3,910,393, 43% Depository Location for Cash & Investments As of June 30, 2018 Petty Cash Accounts, 325, 0% US Bank Checking - Operating, $987,055, 11% US Bank Checking - Payroll, 45,938, 0% LGIP - State Treasurers Office, 8,158,403, 89% Page 37 of 113

38 Wireless Communication Facility Leases - Actual Dollars compared to Constant Dollars $300,000 $250,000 There are 6 leases in 2018 (3 on the water tower & 3 at various points along 84th Ave NE) Sprint Wireless failed to pay 2015 rent of $89,750 on time in 2014 resulting in a 2014 budget underrun variance & 2015 budget over run variance AT&T late payment $200,000 $150,000 $100,000 $50,000 Page 38 of 113 $ Bdg Constant Dollars 83,285 94,151 91,534 94, ,585 83,090 66, , , , , ,373 57, , , , ,004 Actual Dollars 123, , , , , , , , , , , , , , , , ,125

39 Other Operating Revenue - Actual Dollars compared to Constant Dollars $60,000 $50,000 $40, Reasons include: 1) police officer employment contract settlement, 2) cost sharing for the DUI jurisdictional case & 3) Dec '06 storm cost reimbursement from FEMA & the State The City has deposited over $70,000 for processing passport applications since Jul'99 In 2010, $10,800 in $100 bills was deposited to the City's bank account after being found in the back seat of a police patrol vehicle $19,650 received from contractor for street damage near Clyde Lane plus continuing surge in passport processing $15K Sale of surplus PW truck to YP Sale of surplus PW vehicles $30,000 $20,000 $10,000 Page 39 of 113 $ Bdg Constant Dollars 8,218 20,307 17,754 18,725 17,655 30,443 7,284 6,213 14,549 9,382 10,816 9,222 15,922 26,144 23,097 11,843 18,729 Actual Dollars 12,145 30,453 27,038 29,373 28,730 51,414 12,853 11,011 25,988 17,289 20,438 17,639 31,042 51,434 46,477 24,624 40,000

40 Elastic Revenue - Actual Dollars compared to Constant Dollars (Back to 1998) (In Thousands of Dollars) $3,000 $2,500 $2,000 $1,500 Elastic revenues expand and contract with the regional economy and serve as a measure of revenue volatility (e.g. new construction portion of the property tax, sales tax, utility tax, franchise fees, business licensing, development revenues & investment income The purchasing power of elastic revenues as measured in constant dollars (i.e. eliminates inflation in the comparison) was lower in 2009 through 2011 than in Year 2000 $1,000 $500 Page 40 of 113 $ Bdg Constant Dollars ,017 1,084 1, ,074 1, ,063 1,145 1,342 1,335 Actual Dollars ,063 1,012 1,014 1,130 1,377 1,595 1,764 1,879 1,673 1,307 1,311 1,315 2,030 1,949 1,756 2,091 2,303 2,789 2, includes the one time Chinook Middle School Project

41 Elastic Revenue As A Percent of Total Operating Revenue (Back to 1998) 75.0% This chart helps to show the volatility with general fund revenue had $2,789,416 in elastic type revenues that expand or contract with the economy. As recent as 2009, elastic revenues were only $1,307,499 (a swing of $1,481,917) 50.0% 25.0% Page 41 of % Bdg % of Tot Oper Rev 35.2% 40.2% 45.2% 42.6% 42.1% 46.6% 51.6% 54.3% 55.8% 55.8% 53.3% 44.2% 41.8% 42.9% 53.8% 53.0% 51.4% 50.6% 54.5% 59.8% 60.7% Note: includes the one-time Chinook Middle School Project

42 Real Estate Excise Tax (REET) Revenue - Actual Dollars compared to Constant Dollars $1,200,000 $1,000,000 $800,000 Clyde Hill All Time Home Sale Records: 1) Most Homes Sold in 12 Month Period = 112 from August to July , 2) Highest 12 Month Moving Sales Price Average = $3,130,835 from May 2017 to May 2018 and 3) Highest Number of Homes Sold in a Single Month: June 2018 = 18, June 2006 = 15, July 2003 = 15, March 2005 = 14, & October 2016 = 14 Change made by the 2011 Legislature to allow for use of some of this restricted revenue source on maintenance of capital assets (i.e. streets, storm drains, sidewalks) that were normally paid for in the unrestricted General Fund (recently the law's sunset provision was removed also) Previous year's slide..."record 12 month rolling avg was $2,432,237 from Aug 2016 to July 2017." REET rec'd thru July'18 = $921,487. Exceeds budgeted Revenue $600,000 $400,000 $200,000 Page 42 of 113 $ Bdg Constant Dollars 143, , , , , , , , , , , , , , , , ,402 Actual Dollars 212, , , , , , , , , , , , , ,342 1,051,70 889, ,000

43 Year Over Year Comparison of Average Sales Price to Number of Homes Sold $3, $3, Avg Sales Price (In Thousands) $2,500.0 $2,000.0 $1, Number of Homes Sold $1,000.0 $ Page 43 of 113 $- Aug'07 Aug'08 Aug'09 Aug'10 Aug'11 Aug'12 Aug'13 Aug'14 Aug'15 Aug'16 Aug'17 Aug'18 12 Mnth Mov Avg Sales Price $1,816.1 $2,083.1 $1,715.8 $1,407.4 $1,238.6 $1,563.8 $1,540.2 $1,976.2 $1,990.4 $2,173.8 $2,511.2 $3, Mnth Number of Homes Sold Sales Price is stated in Thousands of Dollars 0

44 Criminal Justice Sales Tax Revenue - Actual Dollars compared to Constant Dollars $100,000 $90,000 $80,000 This restricted revenue source represents 0.1% of the 10.0% sales tax paid in most of King County and must be used for Criminal Justice purposes. The chart shows the volatility of a sales tax based revenue source and how unreliable it can be during a recessionary period like recently experienced between 2009 to 2011, especially when measured in constant dollars (i.e. no inflation) $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 Page 44 of 113 $ Bdg Constant Dollars 37,445 36,755 36,487 37,500 38,716 40,640 37,887 31,623 30,199 32,253 32,660 34,585 36,283 38,917 41,179 40,803 40,267 Actual Dollars 55,340 55,117 55,566 58,825 63,003 68,637 66,856 56,048 53,942 59,437 61,716 66,151 70,740 76,562 82,862 84,839 86,000

45 Total Operating Expenditures - Actual Dollars compared to Constant Dollars $4,000 $3,500 Police contract settlement was in 2015 with retro pay back to January, Current police contract runs thru 2020 with the cost of living increase tied to 100% of the June CPI W rate for the Seattle area. $3,000 (In Thousands of Dollars) $2,500 $2,000 $1,500 $1,000 $500 Page 45 of 113 $ Bdg Constant Dollars 1,492 1,510 1,589 1,545 1,604 1,683 1,725 1,707 1,732 1,693 1,648 1,605 1,630 1,776 1,774 1,792 1,995 Actual Dollars 2,205 2,264 2,420 2,424 2,610 2,842 3,043 3,025 3,093 3,119 3,113 3,070 3,178 3,494 3,569 3,727 4,260

46 Total Operating Expenditures - Actual Dollars compared to Constant Dollars (Since 1998) $4,000 (In Thousands of Dollars) $3,500 $3,000 $2,500 $2,000 $1,500 In 2009, City Administrative Staff changed medical plans from an indemnity plan to a PPO for a savings of about $8,500 In 2010, $93,050 was cut from about a third of all operating expense accounts reflecting a 3% decrease from the already decreased 2009 total In 2011, operating costs were budgeted to decrease by 0.8% or $25,575 over the 2010 budget $1,000 $500 Page 46 of 113 $ Bdg Constant Dollars 1,303 1,375 1,355 1,435 1,492 1,510 1,589 1,545 1,604 1,683 1,725 1,707 1,732 1,693 1,648 1,605 1,630 1,776 1,774 1,792 1,995 Actual Dollars 1,708 1,858 1,901 2,083 2,205 2,264 2,420 2,424 2,610 2,842 3,043 3,025 3,093 3,119 3,113 3,070 3,178 3,494 3,569 3,727 4,260

47 General Gov't Services Expenditures - Actual Dollars compared to Constant Dollars $1,000,000 $900,000 $800,000 $700,000 Includes the City Council, the Mayor, City Administrator & Assistant City Administrator (started in January 2016), Finance and Record Services function, Insurance, Legal & Regional Responsibilities Legal expenses were up in 2015 & 2016 and included police contract negotiations, homeowner drainage issue, & court action involving AT&T Mobility $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 Page 47 of 113 $ Bdg Constant Dollars 311, , , , , , , , , , , , , , , , ,338 Actual Dollars 459, , , , , , , , , , , , , , , ,000 1,081,40

48 Law Enforcement Expenditures - Actual Dollars compared to Constant Dollars $1,800 $1,600 $1,400 $1,200 The Police Collective Bargaining Agreement (CBA) starting in Jan'06 included a 6% base wage adjustment due to market conditions Police contract was settled in 2015 with retro pay back to January, 2013 (In Thousands of Dollars) $1,000 $800 $600 $400 $200 Page 48 of 113 $ Bdg Constant Dollars Actual Dollars ,130 1,187 1,388 1,324 1,393 1,366 1,361 1,337 1,371 1,515 1,431 1,522 1,804

49 Public Works/Bldg. Dept. Expenditures - Actual Dollars compared to Constant Dollars $1,000,000 $750,000 A 2007 invoice for street cleaning for $22.2K was inadvertently not paid until 2008 In 2010, moved $37,500 in Storm Drain Improvements and Street Cleaning to the Projects Funds to be paid with NPDES Grant money. 3rd Public Works crew member started in Sept 2016 $500,000 $250,000 Page 49 of 113 $ Bdg Constant Dollars 276, , , , , , , , , , , , , , , , ,362 Actual Dollars 409, , , , , , , , , , , , , , , , ,250

50 Total Salaries and Benefits - Actual Dollars compared to Constant Dollars $3,000 $2,500 Municipal Research and Service Center's web site shows CPI W for the Seattle area at 3.6% over the previous year at the end of Jun'18 (police contract cost of living increase for the following year is tied to this number) The new Assistant City Administrator started in January 2016 and the 3rd PW crew member started in September 2016 $2,000 (In Thousands of Dollars) $1,500 $1,000 $500 Page 50 of 113 $ Bdg Constant Dollars ,019 1,015 1,028 1,081 1,118 1,154 1,278 Actual Dollars 1,090 1,189 1,213 1,240 1,352 1,551 1,702 1,758 1,767 1,840 1,926 1,942 2,004 2,126 2,249 2,398 2,729

51 Total Salaries and Benefits as a Percent of Total Operating Expenditures 80.0% 70.0% In 2012 & 2013, falling overall expenditures due mostly to the fire contract, police dispatch services, court filing fees, detention charges and a shift of expenditures to the Projects Fund helped to drive this percentage upward 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% Page 51 of % Bdg % of Tot Oper Exp 49.4% 52.5% 50.1% 51.2% 51.8% 54.6% 55.9% 58.1% 57.1% 59.0% 61.9% 63.3% 63.1% 60.9% 63.0% 64.4% 64.1%

52 Personnel Benefits as a Percent of Salaries 70.0% 60.0% In 2013, Admin & Public Works staff members and in 2015 police officers began contributing 10% to pay for their medical premiums In response to the proposed "Cadillac Tax" on health insurance plans, the AWC has terminated the most popular employee health insurance plan and replaced it starting in 2018 with a plan less likely to have to pay the excise tax 50.0% 40.0% 30.0% 20.0% 10.0% Page 52 of % Bdg Benefits as % of Salaries 24.3% 30.4% 32.9% 35.3% 37.9% 40.2% 39.0% 44.4% 43.3% 44.0% 45.8% 47.7% 47.1% 47.8% 46.8% 48.4% 50.4% 47.4%

53 Personnel Benefits as a Percent of Total Operating Expenditures 30.0% 25.0% In 2013, Admin & Public Works staff members and in 2015 police officers began contributing 10% to pay for their medical premiums In response to the proposed "Cadillac Tax" on health insurance plans, the AWC has terminated the most popular employee health insurance plan and replaced it starting in 2018 with a plan less likely to have to pay the excise tax 20.0% 15.0% 10.0% 5.0% Page 53 of % Bdg Benefits as % of Tot Exp 9.8% 11.5% 13.0% 13.1% 14.1% 14.9% 15.3% 17.2% 17.6% 17.4% 18.5% 20.0% 20.3% 20.4% 19.4% 20.5% 21.6% 20.6%

54 Contracted Services - Actual Dollars compared to Constant Dollars $250,000 $200,000 Contracted Services includes Engineering, Audit, Elections, Indigent Legal, Jail, Muni Court, Civil Service (Police), Street Cleaning, Building Official & Urban Forestry Program $150,000 $100,000 $50,000 Page 54 of 113 $ Bdg Constant Dollars 95,486 80,053 89, , , , ,964 89,263 82,092 72,945 56,725 45,151 45,364 53,186 33,549 42,711 80,535 Actual Dollars 141, , , , , , , , , , ,190 86,360 88, ,635 67,508 88, ,000

55 Police Dispatch Expenditures - Actual Dollars compared to Constant Dollars $120,000 $100,000 $80,000 Switch to NORCOM in Jul'09 (costs are allocated based on call volume) Confusion defining and estimating call volume initially and then the large Kirkland annexation in 2011 was causing this volatility $60,000 $40,000 $20,000 Page 55 of 113 $ Bdg Constant Dollars 44,795 44,917 44,926 43,908 47,182 43,245 43,146 48,886 64,339 46,665 25,874 31,005 32,941 32,601 36,936 42,705 46,928 Actual Dollars 66,203 67,357 68,418 68,877 76,780 73,036 76,135 86, ,923 85,997 48,892 59,303 64,223 64,138 74,324 88, ,225

56 Fire Protection & Medic One Expenditures - Actual Dollars compared to Constant Dollars $800,000 $700, was the first year of a renegotiated Bellevue Fire contract that distributed costs more based on usage than population $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 Page 56 of 113 $ Bdg Constant Dollars 354, , , , , , , , , , , , , , , , ,739 Actual Dollars 523, , , , , , , , , , , , , , , , ,975

57 Legal Expenditures - Actual Dollars compared to Constant Dollars $300,000 $250,000 Legal action involving AT&T Mobility, a homeowner drainage issue and police contract negotiations were contributing factors to the increased expenditure in 2014 through 2016 $200,000 $150,000 Police employee termination case in 2004 Includes the City Attorney, Labor Negotiation Consultant and Muni Court Prosecutor $100,000 $50,000 Page 57 of 113 $ Bdg Constant Dollars 64,921 56, ,369 71,874 63,414 65,095 40,796 41,129 48,695 45,847 50,955 55,391 77, ,635 93,047 55,429 81,471 Actual Dollars 95,948 84, , , , ,938 71,989 72,895 86,980 84,490 96, , , , , , ,000

58 Insurance Expenditures - Actual Dollars compared to Constant Dollars $80,000 $70,000 Insurance is provided by Washington Cities Insurance Authority (WCIA) and includes liability, auto, property, boiler & machinery, errors & omissions and crime Recent increases are due to loss experience per WCIA $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 Page 58 of 113 $ Bdg Constant Dollars 29,094 33,006 34,665 39,106 34,663 31,343 28,998 30,430 32,270 30,177 28,171 27,368 26,161 28,691 29,107 32,429 38,394 Actual Dollars 42,999 49,495 52,791 61,345 56,408 52,934 51,169 53,933 57,641 55,612 53,234 52,346 51,004 56,445 58,570 67,427 82,000

59 Operating Supplies and Services - Actual Dollars compared to Constant Dollars $140,000 $120,000 $100,000 Main reasons for increases in 2006 & 2007 include personnel recruiting, police civil service, police uniforms and police fuel consumption Overly conservative year end estimates could possibly be the reason for this increased expenditure in 2016 $80,000 $60,000 $40,000 $20,000 Page 59 of 113 $ Bdg Constant Dollars 50,624 53,612 54,217 55,977 66,085 71,524 55,545 45,583 43,748 37,354 44,599 39,576 43,851 42,237 45,771 46,609 52,301 Actual Dollars 74,818 80,397 82,567 87, , ,795 98,015 80,789 78,144 68,837 84,276 75,697 85,495 83,095 92,101 96, ,700

60 Utilities - Actual Dollars compared to Constant Dollars $60,000 $50,000 Clyde Hill City Hall is too small to participate in the EPA's "Energy Star Rating" program. We'll look for other ways to measure energy consumption at City Hall. $40,000 $30,000 $20,000 $10,000 Page 60 of 113 $ Bdg Constant Dollars 22,183 25,477 23,350 25,669 27,990 23,132 28,775 24,356 26,549 23,379 24,301 21,319 23,175 22,441 24,837 14,211 19,665 Actual Dollars 32,784 38,205 35,560 40,267 45,548 39,068 50,776 43,168 47,423 43,084 45,921 40,776 45,184 44,149 49,977 29,548 42,000

61 Repairs and Maintenance - Actual Dollars compared to Constant Dollars $160,000 $140,000 Includes work on City Hall, Police and Public Works vehicles, roadways, storm drains, sidewalks, and information technology equipment (i.e. the cost of preserving what the City already has in place) IT repairs has been an increasing line item and a drainage issue in 2015 are the primary reasons for increases $120,000 $100,000 Extra storm drain maintenance was done in 2008 $80,000 $60,000 $40,000 $20,000 Page 61 of 113 $ Bdg Constant Dollars 65,200 38,524 60,334 42,032 43,927 46,010 71,270 46,610 38,930 34,421 45,144 32,747 33,791 62,717 63,229 71,952 60,167 Actual Dollars 96,360 57,771 91,882 65,934 71,483 77, ,763 82,609 69,537 63,432 85,306 62,635 65, , , , ,500

62 Minor Equipment - Actual Dollars compared to Constant Dollars $16,000 $14,000 $12,000 Capital Assets valued at over $5,000 are expensed when paid for and are recorded in the City's Projects Fund. The City maintains an Equipment Replacement Schedule out to six years in the future and is updated annually. $10,000 $8,000 $6,000 $4,000 $2,000 Page 62 of 113 $ Bdg Constant Dollars 7,951 4,984 4,024 4,528 4,972 3,219 4,835 2,220 2,944 2,009 1,739 2,934 1,206 3,965 1,704 1,716 7,075 3,278 Actual Dollars 11,547 7,365 6,035 6,895 7,799 5,238 8,166 3,917 5,217 3,589 3,204 5,545 2,307 7,730 3,352 3,452 14,711 7,000

63 Other Operating Expenditures - Actual Dollars compared to Constant Dollars $40,000 $35,000 This expenditure category includes meetings, public notices, travel, membership dues for the City to belong to AWC, PSRC, Sound Cities, ARCH and ETP, leases, Alcoholism Prevention and Pollution Control $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 Page 63 of 113 $ Bdg Constant Dollars 18,723 16,196 17,695 15,610 14,955 15,796 16,786 16,696 16,139 16,071 15,581 14,956 14,565 15,281 16,449 15,606 16,575 Actual Dollars 27,671 24,287 26,947 24,487 24,337 26,678 29,620 29,592 28,827 29,616 29,442 28,606 28,396 30,063 33,100 32,449 35,400

64 Clyde Hill Roadway & Total Capital Expenditures Over Time $4,000 (In Thousands of Dollars) $3,500 $3,000 $2,500 $2,000 $1,500 For better construction management, 2006 was delayed and combined with scheduled projects in 2007 Clyde Hill served as the lead agency on the 84th Ave NE Roadway Project and accounted for the total expenditures of $871,900 (before reimbursements from Medina and the Transportation Improvement Board) 2013 was the first year of the 5 phased every other year Sidewalk Project per the Transportation Improvement Plan (TIP) Sidewalks along 92nd Ave NE & NE 24th St 84th Ave NE Project Ph. II. NE 24th to NE 28th $1,000 $500 Page 64 of 113 $ Bdg Roadway Cap Exp , ,140.0 Total Cap Exp , , ,635.0

65 Total City Expenditures - Actual Dollars compared to Constant Dollars $9,000 $8,000 (In Thousands of Dollars) $7,000 $6,000 $5,000 $4, included $2,171,465 in capital improvement projects for roadways, storm drains and sidewalks 2012 included $871,893 total expenditures for the 84th Ave NE Roadway Project (includes Medina's and the Transportation Improvement Board's share) Substantial increase in capital improvement expenditures (i.e. roadways & sidewalks $3,000 $2,000 $1,000 Page 65 of 113 $ Bdg Constant Dollars 1,759 2,365 1,969 1,938 1,770 3,061 2,193 1,920 1,941 1,954 2,250 1,926 1,972 2,083 2,396 2,916 4,186 Actual Dollars 2,600 3,546 2,999 3,040 2,881 5,170 3,869 3,402 3,466 3,600 4,252 3,684 3,845 4,099 4,821 6,063 8,941

66 General Fund (Operating Fund) Surplus or Deficit $800,000 $700,000 $600,000 Surplus or Deficit is measured by the difference between operating revenues and operating expenditures. It does NOT include fund transfers or fund balance carry overs from the previous fiscal year 2012 had a big assist from the $40.5M Chinook Middle School Project and the housing market recovered Strong new home construction $500,000 $400,000 $300,000 $200,000 The "Great Recession" officially started in December 2007 and lasted through June Seattle area lagged the national impact. $100,000 $0 Page 66 of 113 ($100,000) Bdg Oper Surplus (Deficit) 203, , , , , ,593 98,394 (63,365) 41,329 (57,048) 662, , , , , , ,275

67 General Fund (Operating Fund) Surplus or Deficit (Back to 1993) (In Thousands of Dollars) $1,000 $800 $600 $400 Surplus or Deficit is measured by the difference between operating revenues and operating expenditures and does NOT include fund transfers or fund balance carry overs from the previous fiscal year Official recession from March 2001 through November 2001 (9 months) The "Great Recession" December 2007 through June 2009 (19 months Seattle area lagged behind the national impact) $40.5M Chinook Middle School Project $200 $0 Page 67 of 113 ($200) Bdg Oper Surplus (Deficit) (63) 41 (57)

68 Total City Fund Balances - Actual Dollars compared to Constant Dollars $10,000 $9,000 The City has 3 funds for budgeting purposes: 1) General Fund, 2) Reserve Fund and 3) Projects Fund $8,000 (In Thousands of Dollars) $7,000 $6,000 $5,000 $4,000 Please see The New Yorker earthquake article as one reason to carry large fund balances: 07/20/the really big one $3,000 $2,000 $1,000 Page 68 of 113 $ Bdg Constant Dollars 1,902 1,483 1,913 2,423 3,091 2,374 2,131 2,264 2,357 2,316 2,765 3,235 3,381 4,007 4,227 4,100 3,359 Actual Dollars 2,811 2,224 2,914 3,800 5,031 4,009 3,761 4,013 4,209 4,269 5,224 6,187 6,593 7,882 8,505 8,526 7,174

69 Reserve Fund Ending Balance since 1998 (In Thousands of Dollars) $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 In 12 years from 1997 to 2008, mostly aided by the housing boom that started in the 2nd half of the 1990s, the City was able to place $1,851,000 into the Reserve Fund City Policy #5 calls for the Reserve Fund "to address adverse financial trends, provide for financing of unforeseen needs of an emergency or non recurring nature, to permit for the orderly implementation of budget adjustments, provide for a local match for public or private grants and to allow for flexibility to take advantage of any unexpected opportunities The one time revenue from the Chinook MS Project contributed to the increases in 2012 to 2014 $1,000 $500 Page 69 of 113 $ Bdg Res Fund End Bal ,022 1,153 1,402 1,697 1,765 2,116 1,933 1,729 1,825 2,133 2,585 3,150 3,186 3,186 3,186 3,910

70 Total Operating Revenue compared to Total Operating Expenditures $5,000 $4,500 $4,000 From 2012 through Jan, 2015, the one time Chinook MS Project contributed $894,664 in operating revenues to the City of Clyde Hill ($547,656 in Development Revenues & $347,008 in Sales Tax) Strong new home construction from 2015 to 2018 (In Thousands of Dollars) $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 Page 70 of 113 $ Bdg Operating Revenue 2,408 2,425 2,668 2,935 3,160 3,365 3,142 2,961 3,134 3,062 3,776 3,674 3,414 4,129 4,225 4,661 4,696 Operating Expenditures 2,205 2,264 2,420 2,424 2,610 2,842 3,043 3,025 3,093 3,119 3,113 3,070 3,178 3,494 3,569 3,727 4,260

71 Total City Revenue compared to Total City Expenditures $7,000 $6,000 Between 20% and 27% of Total City Revenues are recorded in the Projects Fund meaning they are restricted revenues and not readily available to pay for day to day operating expenditures In 2016, Real Estate Excise Tax (REET restricted revenue) exceeded $1M in one year for the first time ever! 2018 REET Revenue stands at $921,487 thru July 2018! 2018 REET Revenue budget is $900K $5,000 (In Thousands of Dollars) $4,000 $3,000 $2,000 $1,000 Page 71 of 113 $ Bdg Total City Revenue 2,738 2,959 3,689 3,926 4,111 4,148 3,621 3,655 3,662 3,660 5,207 4,647 4,250 5,388 5,444 6,084 7,590 Total City Expenditures 2,600 3,546 2,999 3,040 2,881 5,170 3,869 3,402 3,466 3,600 4,252 3,684 3,845 4,099 4,821 6,063 8,941

72 Page 72 of 113

73 Projecting the City s Financial Future 2019 Budget Development Process 9605 NE 24 th Street Clyde Hill, Washington Fax: Background To assist the Council and Budget Advisory Committee in the development of next year s budget, the staff prepared a worst case revenue and expense financial projection through 2024, a best case projection and a most likely projection. Although this analysis is based on hypothetical economic conditions and projections, the staff prepares the projections such that they represent a realistic and meaningful start to the 2019 budget process. Projection Overview The intent is for the worst case and best case projections to serve as bookends for what could happen in the City s financial future if most influences were really good or conversely, went really bad. The most likely scenario represents a more likely middle ground of the highest probability of what could be expected. In general, the best case scenario assumes the City s revenues will continue to climb throughout the projection period due to a continued strong housing market and expenditures increasing at the Fed s target inflation rate of 2.0%. For the worst case revenue projection, a moderate recession hits Clyde Hill, though not as bad as experienced in 2009 through The worst case projection also shows the financial impact that moderate to high inflation has on the City s expenditures in the form of salaries & benefits, contracted services and other day to day operating costs. Both the worst-case and most likely scenarios include a new item to the projections, the use of $1M towards the City s Facilities Master Plan. Charts Revenue, expenditure and fund balance charts have been included to show a visual representation of the three scenarios. The primary focus of each projection is on the City s General Fund (Operating Fund). The fund balance for each of the City s three fund types (General Fund, Reserve Fund & Projects Funds) are charted through 2024 to show the bottom line impact on available resources to keep providing services at existing levels. Concluding Remarks The staff will share their take a ways with the group at the meeting regarding the three financial projection scenarios. Page 73 of 113

74 9605 NE 24 th Street Clyde Hill, Washington Fax: Chart Index Projecting the City s Financial Future 2019 Budget Development Process Tables Ending Fund Balances 1. Year-End Balances by Fund Three Different Case Scenarios Charts - Ending Fund Balances 1. Ending Fund Balances Best Case Scenario 2. Ending Fund Balances Most Likely Case Scenario 3. Ending Fund Balances Worst Case Scenario Charts - General Fund (Operating Fund) 4. Property Tax Revenue Three Different Case Scenarios 5. Sales Tax Revenue Three Different Case Scenarios 6. Utility Tax & Franchise Fees Three Different Case Scenarios 7. Development Revenues Three Different Case Scenarios 8. Motor Vehicle Fuel Tax Revenue Three Different Case Scenarios 9. Federal & State Shared Revenues Three Different Case Scenarios 10. Yarrow Point Police Contract Three Different Case Scenarios 11. Fines & Penalties Three Different Case Scenarios 12. Investment Income Three Different Case Scenarios 13. Wireless Communication Facility Leases Three Different Case Scenarios 14. Total Operating Revenue Three Different Case Scenarios 15. Total Operating Expenditures Three Different Case Scenarios Charts - Comparison of Total Operating Revenues and Expenditures 16. Best Case Scenario Total Operating Revenues and Expenditures 17. Most Likely Case Scenario Total Operating Revenues and Expenditures 18. Worst Case Scenario Total Operating Revenues and Expenditures Page 74 of 113

75 BEST-CASE SCENARIO FUND 2016 Actual 2017 Actual 2018 Budgeted General Fund 899,713 1,117,912 1,654,191 3,037,611 3,877,082 4,279,504 4,667,597 5,031,999 5,362,494 Reserve Fund 3,186,477 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 Projects Fund 4,418,704 4,221,171 2,201,063 2,421,063 1,431,063 1,511,063 1,591,063 1,576,063 1,836,625 8,504,894 8,525,559 7,041,730 8,645,150 8,494,621 8,977,043 9,445,136 9,794,538 10,385,595 MOST LIKELY CASE SCENARIO FUND 2016 Actual 2017 Actual 2018 Budgeted General Fund 899,713 1,117,912 1,654,191 1,693,747 2,208,121 2,315,818 2,326,892 2,322,660 2,137,984 Reserve Fund 3,186,477 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 Projects Fund 4,418,704 4,221,171 2,201,063 2,421,063 1,431,063 1,511,063 1,591,063 1,576,063 1,836,625 8,504,894 8,525,559 7,041,730 7,301,286 6,825,660 7,013,357 7,104,431 7,085,199 7,161,085 WORST-CASE SCENARIO FUND 2016 Actual 2017 Actual 2018 Budgeted General Fund 899,713 1,117,912 1,654,191 1,026, ,244 48, Reserve Fund 3,186,477 3,186,476 3,186,476 3,186,476 3,186,476 3,186,476 2,426, ,491 (713,668) Projects Fund 4,418,704 4,221,171 2,201,063 2,421,063 1,431,063 1,511,063 1,591,063 1,576,063 1,836,625 8,504,894 8,525,559 7,041,730 6,633,877 5,436,783 4,745,574 3,257,584 2,183,554 1,122,957 Page 75 of 113

76 Ending Fund Balances - Best Case Scenario $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ Actual 2017 Actual Budgeted General Fund Reserve Fund Projects Fund Page 76 of 113

77 $5,000,000 Ending Fund Balances - Most Likely Case Scenario $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ Actual 2017 Actual 2018 Budgeted General Fund Reserve Fund Projects Fund Page 77 of 113

78 Ending Fund Balances - Worst Case Scenario $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ Actual 2017 Actual 2018 Budgeted ($1,000,000) ($2,000,000) General Fund Reserve Fund Projects Fund Page 78 of 113

79 Property Tax Revenue - Three Different Case Scenarios $1,450,000 $1,350,000 $1,250,000 $1,150,000 $1,050,000 $950,000 $850,000 $750, Actual 2017 Actual 2018 Budgeted Worst Case 998,641 1,017,492 1,013,000 1,014,000 1,015,000 1,016,000 1,017,000 1,018,000 1,019,000 Most Likely 998,641 1,017,492 1,013,000 1,039,000 1,065,000 1,091,000 1,117,000 1,288,807 1,327,695 Best Case 998,641 1,017,492 1,013,000 1,049,130 1,085,621 1,122,478 1,159,702 1,197,299 1,235,272 Page 79 of 113

80 Sales Tax Revenue - Three Different Case Scenarios $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 482, , , , , , , , ,000 Most Likely 482, , , , , , , , ,000 Best Case 482, , , ,200 1,042, , , , ,491 Page 80 of 113

81 Utility Tax & Franchise Fees - Three Different Case Scenarios $1,100,000 $1,000,000 $900,000 $800,000 $700,000 $600,000 $500, Actual 2017 Actual 2018 Budgeted Worst Case 794, , , , , , , , ,499 Most Likely 794, , , , , , , , ,592 Best Case 794, , , , , , , , ,278 Page 81 of 113

82 Development Revenues - Three Different Case Scenarios $2,250,000 $2,000,000 $1,750,000 $1,500,000 $1,250,000 $1,000,000 $750,000 $500,000 $250,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 969,185 1,277,504 1,280,000 1,390, , , , , ,250 Most Likely 969,185 1,277,504 1,280,000 1,842,052 1,127,000 1,127,000 1,127,000 1,127,000 1,127,000 Best Case 969,185 1,277,504 1,280,000 2,030,094 1,174,996 1,195,596 1,216,608 1,238,040 1,259,901 Page 82 of 113

83 Motor Vehicle Fuel Tax - Three Different Case Scenarios $100,000 $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 Page 83 of 113 $20, Actual 2017 Actual 2018 Budgeted Worst Case 68,284 69,488 70,000 66,632 66,541 65,876 65,217 64,565 63,919 Most Likely 68,284 69,488 70,000 66,632 66,541 66,541 66,541 66,541 66,541 Best Case 68,284 69,488 70,000 66,632 66,541 68,205 69,910 71,657 73,449

84 Federal & State Shared Revenues - Three Different Case Scenarios $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10, Actual 2017 Actual 2018 Budgeted Worst Case 40,569 45,935 41,500 44,148 44,057 43,621 43,188 42,761 42,337 Most Likely 40,569 45,935 41,500 45,148 45,057 45,057 45,057 45,057 45,057 Best Case 40,569 45,935 41,500 46,148 46,057 47,149 48,267 49,414 50,589 Page 84 of 113

85 Yarrow Point Police Contract - Three Different Case Scenarios $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 418, , , , , , , , ,454 Most Likely 418, , , , , , , , ,696 Best Case 418, , , , , , , , ,114 Page 85 of 113

86 Fines & Penalties - Three Different Case Scenarios $250,000 $200,000 $150,000 $100,000 $50,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 140,615 98,046 62,500 52,500 52,500 52,500 52,500 52,500 52,500 Most Likely 140,615 98,046 62,500 60,000 60,000 60,000 60,000 60,000 60,000 Best Case 140,615 98,046 62,500 72,500 72,500 72,500 72,500 72,500 72,500 Page 86 of 113

87 Investment Income - Three Different Case Scenarios $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 35,737 80, , , , , , , ,784 Most Likely 35,737 80, , , , , , , ,360 Best Case 35,737 80, , , , , , , ,991 Page 87 of 113

88 Wireless Communication Facility Leases - Three Different Case Scenarios $500,000 $400,000 $300,000 $200,000 $100,000 $ Actual 2017 Actual 2018 Budgeted Worst Case 230, , , , , , , , ,515 Most Likely 230, , , , , , , , ,059 Best Case 230, , , , , , , , ,669 Page 88 of 113

89 Total Operating Revenue - Three Different Case Scenarios $6,000,000 $5,500,000 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000, Actual 2017 Actual 2018 Budgeted Worst Case 4,224,874 4,660,759 4,696,125 4,816,970 4,362,972 4,022,600 4,234,350 4,274,993 4,321,258 Most Likely 4,224,874 4,660,759 4,696,125 5,440,419 5,003,301 4,782,416 4,884,282 5,093,894 5,166,001 Best Case 4,224,874 4,660,759 4,696,125 5,726,399 5,233,103 4,930,867 5,060,336 5,192,136 5,324,254 Page 89 of 113

90 Total Operating Expenditures - Three Different Case Scenarios $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000, Actual 2017 Actual 2018 Budgeted Worst Case 3,568,922 3,726,565 4,231,350 5,444,823 4,570,067 4,793,810 5,042,362 5,334,024 5,642,417 Most Likely 3,568,922 3,726,565 4,251,350 5,400,864 4,488,926 4,674,720 4,873,207 5,098,125 5,350,677 Best Case 3,568,922 3,726,565 4,259,850 4,342,980 4,393,631 4,528,446 4,672,243 4,827,735 4,993,759 Page 90 of 113

91 Best Case Scenario - Total Operating Revenues & Expenditures $6,500,000 $6,000,000 $5,500,000 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500, Actual 2017 Actual 2018 Budgeted Expenditures 3,568,922 3,726,565 4,259,850 4,342,980 4,393,631 4,528,446 4,672,243 4,827,735 4,993,759 Revenue 4,224,874 4,660,759 4,696,125 5,726,399 5,233,103 4,930,867 5,060,336 5,192,136 5,324,254 Page 91 of 113

92 Most Likely Scenario - Total Operating Revenues & Expenditures $6,000,000 $5,500,000 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500, Actual 2017 Actual 2018 Budgeted Expenditures 3,568,922 3,726,565 4,251,350 5,400,864 4,488,926 4,674,720 4,873,207 5,098,125 5,350,677 Revenue 4,224,874 4,660,759 4,696,125 5,440,419 5,003,301 4,782,416 4,884,282 5,093,894 5,166,001 Page 92 of 113

93 Worst Case Scenario - Total Operating Revenues & Expenditures $6,000,000 $5,500,000 $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500, Actual 2017 Actual 2018 Budgeted Expenditures 3,568,922 3,726,565 4,231,350 5,444,823 4,570,067 4,793,810 5,042,362 5,334,024 5,642,417 Revenue 4,224,874 4,660,759 4,696,125 4,816,970 4,362,972 4,022,600 4,234,350 4,274,993 4,321,258 Page 93 of 113

94 Page 94 of 113

95 City of Clyde Hill 2017 DASHBOARD REPORT Page 95 of 113

96 2017 City of Clyde Hill Dashboard Report Introduction The City s performance measurement model, called the City of Clyde Hill Dashboard Report, has been prepared for eight consecutive years now with the following objectives in mind: 1. Provide transparency and accountability to all stakeholders interested in evaluating the performance of the City of Clyde Hill in a quick to read and quantifiable report; 2. Assist participants in the annual budget development process with a tool to help them allocate the limited financial and human resources available to accomplish the intended outcomes for the City; and 3. Continually improve this reporting method with a wide ranging yet manageable group of performance measures that has minimal impact on productive staff time in terms of data gathering. The model is currently comprised of 24 dashboard performance measures, which are organized around generally accepted local government service priorities: 1. Community Safety and Security: (8 Indicators) Property Crime Prevention Effectiveness Violent Crime Prevention Effectiveness Auto Theft Prevention Effectiveness Traffic Safety Effectiveness Pedestrian Safety Effectiveness Timely Emergency Police Call Response Timely Emergency Fire & EMS Incident Response Emergency Medical Aid Effectiveness 2. Strong Financial Management Practices (10 Indicators) Maximize Sales Tax Revenues Timely Bank Reconciliations Independently Reviewed Independent Annual Audit Compliance with the State Auditor s Office Financial Intelligence Tool (FIT) Financially Informed Citizenry Award Winning Budget Book AWC WellCity Award Recipient Municipal Court Operations Reliable Financial Projections Revenue Reliable Financial Projections Expenditures Financial Condition of Reserve Account 3. Effective and Efficient Public Service Delivery: (5 Indicators) City Vehicle Accidents Page 96 of 113

97 2017 City of Clyde Hill Dashboard Report Worker Compensation Claims Filed Building Inspection Services Informed Citizenry Web Site Usage, Facebook & Electronic Newsletter Subscribers City Hall Front Counter Passports, Concealed Pistol & Animal Licenses & Copies 4. Reliable Public Infrastructure & Utilities: (1 Indicator) Street Pavement Condition Quick Glance Report Card Summary One of three ratings (i.e. thumbs-up, thumb neutral (condition is improving), or thumbs-down), along with a brief comment, is provided for each of the 24 dashboard performance measures listed below. The performance measures are grouped together under a generally accepted priority of local government. Community Safety and Security # Dashboard Indicator Current Rating Comment 1 Property Crime Prevention Effectiveness Clyde Hill had been experiencing an uptick in property crimes over the past four years, but the numbers drastically decreased last year. Clyde Hill ranks in 3 rd place among its neighbors for the past five years. 2 Violent Crime Prevention Effectiveness The violent crime rate in Clyde Hill has essentially plateaued. Clyde Hill ranks in 4 th place among its neighbors for the past five years. 3 Auto Theft Prevention Effectiveness Clyde Hill has been experiencing an uptick in auto theft, a trend that has recently plateaued. Clyde Hill ranks in 1 st place among its neighbors for the past five years! Page 97 of 113

98 2017 City of Clyde Hill Dashboard Report 4 Traffic Safety Effectiveness Clyde Hill s traffic safety rates shot down significantly this year. Clyde Hill ranks 3 rd among its neighbors over the past five years. 5 Pedestrian Safety Effectiveness During the past three years there were no pedestrian accidents this year there was one. Clyde Hill ranks 4 th among its neighbors over the past five years. 6 Timely Emergency Police Call Response The number of emergency police calls dropped sharply, the average response time increased slightly and the percentage of emergency calls responded to within six minutes remained stable. 7 Timely Fire & EMS Incident Response Although there has been a noticeable increase in the number of incidents, response times have slightly decreased. 8 Emergency Medical Aid Effectiveness Although King County rates are not yet available for comparison, cardiac arrest survival rates for Bellevue/Clyde Hill indicate a slight drop. Strong Financial Management Practices # Dashboard Indicator Current Rating Comment 9 Maximize Sales Tax Revenue There was a noticeable increase in the valuation of homes, the total valuation of new homes built and the amount of sales tax received from new homes. Page 98 of 113

99 2017 City of Clyde Hill Dashboard Report 10 Bank Reconciliations Bank Statements continue to be reconciled to the City's books each month in a timely manner & independently reviewed by the City Administrator. 11 Independent Annual Audit For at least the 26 th consecutive year, the City has received an unqualified (i.e. no findings) audit opinion very few cities can make this claim! 12 Compliance with the State Auditor s Office Financial Intelligence Tool (FIT) Guidelines For the 12 th consecutive year (including during the Great Recession), the City has complied with the SAO s financial guidelines. Additionally, Clyde Hill looks favorable when compared to similar cities. 13 Financially Informed Citizenry The annual Budget Book has earned the Distinguished Budget Award from the Government Finance Officers Association for over two decades! 14 AWC WellCity Award Recipient Achieving this award for the 8 th consecutive year shows the City s culture has embraced wellness activities. This also means a 2% discount on medical premiums. The number of sick days ticked upwards a little this year, though. 15 Municipal Court Operations Although there was a significant spike in cases filed during 2015, that number has normalized. However, revenue in relation to expenses continues to drop meaning a larger cost for the City. Page 99 of 113

100 2017 City of Clyde Hill Dashboard Report 16 Reliable Financial Projections - Revenue The variance between the most likely case and the Year End Actual was 5.0%...double the target range of 2.5%. 17 Reliable Financial Projections - Expenditures The variance between the most likely case and the Year End Actual continues for the 10 th consecutive year to be within the target range of 2.5%...this year by 0.4%! 18 Financial Condition of Reserve Account The ratio of the Reserve Fund balance to General Fund total expenditures continues to comply with the City Council s long standing policy guidelines. Effective and Efficient Public Service Delivery # Dashboard Indicator Current Rating Comment 19 City Vehicle Accidents Unfortunately there were two accidents last year, as opposed to zero the year before. 20 Worker Compensation Claims Unfortunately there were two WC claims filed last year, as opposed to one the year before. 21 Building Inspection Services All building inspections were performed within 24 hours of the request even with an increase. One Stop Work order was issued and the average review time for plans remains dropped noticeably. Page 100 of 113

101 2017 City of Clyde Hill Dashboard Report 22 Informed Citizenry Web Site Usage & Facebook likes All numbers (City website, Facebook and our enewsletter) are significantly on the rise!!! 23 City Hall Front Counter Transactions Passports, Concealed Pistol Licenses & Copies The number of passport applications continue to drop. The number of CPL and copy requests have also dropped. Reliable Public Infrastructure & Utilities # Dashboard Indicator Current Rating Comment 24 Street Pavement Condition The average rating of the City s streets jumped up to almost 99% of all roads rating Fair to Very Good this year!!! Page 101 of 113