By Erica C. Barnett
For those following along with the City Council’s budget process, budget chair Dan Strauss’ effort to wrap the whole thing up with a bow on Friday failed dramatically, after the city firefighters’ pension fund filed a lawsuit over Strauss’ proposal to reduce the amount the city transfers into the firefighters’ pension fund by $11 million a year, or $22 million over the two-year budget cycle.
The lawsuit also reportedly concerns a section of Mayor Katie Wilson’s original budget. That proposal, which is what the council is currently amending, would close down a separate “actuarial account,” established in 1994 as a kind of backstop that, the city hoped, would eventually be enough to pay for all future obligations. (It currently stands at about $36 million). The mayor’s proposal took that money and transferred it into the regular pension plan, reducing the need for transfers from the general fund in 2027 and 2028.
Strauss’ proposed balancing package freed up an additional $22 million to pay for some of the more than $50 million in new council spending by reducing the amount the city would pay into the pension fund each year. That last-minute decision, which Strauss announced last week, appears to be what got the firefighters riled about the overall pension issue.
In a letter to the council dated Thursday, November 12, Seattle Fire Fighters union president Kenny Stuart wrote, “We believe that it is fiscally irresponsible, and just plain wrong, to use dedicated pension reserves for non-pension purposes. These pension reserves have been legally dedicated to the retired fire fighters who have served this community and many of the current recipients are their widows.”
“Seattle Fire Fighters never forget, and our City should never forget the promises made to those who served,” Stuart wrote.
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Strauss put his $22 million proposal in a “chair’s package” of consent amendments—amendments where there was supposedly council consensus, allowing the council to vote the whole thing through as a package. Earlier this week, he predicted the council would be able to conduct all discussion of every amendment, including those on his consent package and those that would definitely require more discussion, and pass the entire budget through committee on Friday.
Some council members objected, both in public and behind the scenes, to this accelerated schedule, since the consent package included many new amendments with less than majority support and many no one had ever seen before last week, sponsored only by Strauss himself. These included a sales tax increase that would directly reduce King County’s ability to prioritize its own human services projects, directives that would move spending on higher-priority projects to bus routes in Ballard, and a slew of new spending in the “Ballard Brewery District.”
Maritza Rivera, who asked for discussion of several “complicated and controversial” amendments in Strauss’ consent package on Friday, directed her comments at Strauss on Friday. “Chair, I have to admit that at times this process has felt less than forthright. … It feels like we don’t have all the information at the proper time we should have it and it also makes our constituents distrust government,” she said.
The firefighters’ letter threw an additional wrench into those optimistic plans, forcing the council into multiple executive sessions to discuss the potential litigation and causing visible frustration from council members on the dais. “We were not made aware of the complications surrounding the use of the firefighter actuarial fund, and we’ve learned the firefighter pension board and the firefighters were not in support of this,” Rivera said. “That should have been flagged from the start.”
The council concluded its day-long Friday meeting a little after 6pm, with most council members looking wilted and ready to go after they adopted what remained of the consent package after nearly 20 amendments were pulled out for additional discussion.
Strauss said he hopes to wrap up the budget on Monday. It’s unclear what impact the lawsuit will have; restoring the actuarial account would blow a massive hole in the budget that the council has little time to address next week, when the full budget, including all council amendments and related legislation, was supposed to move through committee.
Even if the proposed budget, with the reductions to the pension contributions and the closure of the actuarial account, prevails, the funding only goes through 2028, meaning the city will have once again set itself up to either make significant cuts in the near future or come up with more budget tricks, such as additional raids on the JumpStart payroll tax fund, to keep all the new spending the council piled on this year.
Mayor Katie Wilson’s office declined to comment on the firefighters’ response to Strauss’ amendments, except to say that “the mayor is aware of the lawsuit.”
Stuart, from the firefighters’ union, did not respond to requests for an interview on Saturday.
