Quarterly Summary (quarter ending 2024-09-30)

AI Information

Analysis

Date Range: 2024-07-01 – 2024-09-23

Executive Summary

In the third quarter of 2024, the Jefferson County Board of Commissioners operated in a state of sustained crisis management, battling wildfires and confronting the consequences of a failing road fund while simultaneously advancing long-term infrastructure and regulatory reforms. Governance was defined by a reactive posture to immediate threats—both physical and fiscal—which forced difficult trade-offs between essential services and strategic investment. The board committed over $9 million in new contracts and grants, primarily for sewer construction and road improvements, yet was forced to formally consider a new taxing district to prevent the insolvency of its road maintenance operations.

The quarter's dominant pattern was the collision of ambition with operational reality. Commissioners approved a $2.58 million contract to expand the Port Hadlock sewer system and accepted over $3.5 million in state and federal grants for the Olympic Discovery Trail. Concurrently, Public Works staff delivered a stark warning that the Road Fund faces a nearly $1 million deficit in 2025, driven by costs outpacing stagnant revenues. This forced the board to initiate the formation of a Transportation Benefit District, a new taxing authority, to fund basic services like chip sealing and snowplowing.

Winners this quarter were contractors awarded sewer and road supply contracts and advocates for land use reform, as the board increased permitting fees to achieve 100% cost recovery. Losers were county taxpayers, who now face new sales taxes or vehicle fees to maintain existing road service levels. The unhoused community continued to face uncertainty as service providers and the county debated shelter protocols. The board’s actions reveal a fundamental tension: while successfully leveraging external grants for major projects, the county’s core, locally-funded services—public safety, road maintenance, and legal capacity—are stretched to their breaking point, forcing a turn to new, direct taxation to remain solvent.

Individual Action Analysis

1. Board Confronts Road Fund Insolvency, Moves to Create New Taxing Authority

Topic

Commissioners directed staff to begin the formation of a Transportation Benefit District (TBD), a new taxing authority, to address a projected near-$1 million deficit in the county Road Fund for 2025.

Context

  • Fiscal Crisis: Public Works presented analysis showing that since 1998, Road Fund revenues have increased by an average of 1.6% annually, while costs for labor, materials, and equipment have risen dramatically. The fund is projected to be overspent by more than $900,000 in 2025.
  • Service Degradation: To manage costs, the county has already cut its vital chip seal program in half, from 35 miles to 17 miles annually. The average road resurfacing interval is now 20 years, far exceeding the recommended 7-12 years.
  • Revenue Constraints: The Road Fund's primary revenue sources—property taxes (limited to 1% annual growth) and a flat motor vehicle fuel tax—are structurally incapable of keeping pace with inflation.

Public Input

  • Who testified: Tom Brotherton, a resident.
  • What they represented: A taxpayer perspective.
  • Substance of testimony: Supported the formation of the TBD, praised the Public Works department for its road maintenance, and urged the board to "rip the Bandaid off" and implement the necessary revenue measures at once rather than incrementally.

Deliberation Insights

  • No Viable Alternatives: Deliberation centered on the inevitability of the TBD. Public Works Director Monte Reinders stated it was the only "viable option to raise more revenue." No other solutions were presented or debated.
  • Scope of New Taxes: The board discussed the two revenue options available through a TBD without a public vote: a 0.1% sales tax (projected to raise $600,000 annually in unincorporated areas) and a $20 vehicle license fee (projected to raise $500,000 annually).
  • Reluctance and Resignation: Commissioners accepted the necessity of the new taxing authority but showed no enthusiasm. The discussion framed the action as a last resort to prevent the collapse of a core service.

Decision & Vote

Approved 3-0 a motion to set a hearing to consider the formation of a Transportation Benefit District in unincorporated Jefferson County. (Sep 23)

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: Public Works, which gains a potential funding mechanism to stave off insolvency and continue basic maintenance. Construction firms that supply road materials also benefit.
  • Losers: County residents and businesses, who will face a new sales tax, increased vehicle fees, or both, to maintain the current, diminished level of road service.
  • Fiscal Impact: The action initiates a process that will lead to new taxes totaling approximately $1.1 million annually.
Strategic Implications
  • Reactive Governance: This is a purely reactive measure to a foreseeable fiscal crisis. The decision addresses an immediate budget shortfall but does not represent a long-term strategic investment in transportation.
  • Tax Base Limits vs. Service Demands: This action is a direct consequence of the county's fundamental tension. A limited, slow-growing tax base can no longer support the costs of maintaining essential infrastructure for a dispersed rural population.
  • Pattern Recognition: The turn to a new, dedicated taxing authority for a basic service mirrors the financial struggles seen in other county departments. It signals that the existing general fund and special revenue fund structure is no longer sustainable.
Critical Gaps & Risks
  • Underlying Cost Drivers Unaddressed: The deliberation focused on raising revenue, not on controlling the escalating costs of labor, materials, and equipment that created the crisis.
  • Political Risk: While the initial TBD formation does not require a public vote, imposing new taxes is politically risky and may erode public trust, especially if service levels do not visibly improve.
  • Long-Term Viability: The TBD provides a short-term fix. It does not address Washington's broader systemic challenges in funding local transportation infrastructure, meaning a similar crisis is likely to recur.

2. County Greenlights Pool Taxing District, Shifting Planning to New Public Entity

Topic

In a joint meeting with the Port Townsend City Council, the Board of Commissioners gave consensus support for the creation of a county-wide Public Facilities District (PFD) to plan, fund, and operate a new community aquatic facility.

Context

  • Failing Infrastructure: The current Mountain View Pool in Port Townsend is aging, inefficient, and requires an estimated $8 million or more in repairs, with costs described as a "sinkhole of resources."
  • Service Demands: A "Healthier Together" task force concluded a new, single aquatic center located in the Tri-Area would serve 82% of the county population within a 20-minute drive, compared to 61% for the current location.
  • Fiscal Constraints: Neither the county nor the city has the capital or operational funds to build or run a new pool. The PFD model is presented as the only viable path forward, funded by a proposed 0.2% county-wide sales tax requiring voter approval.

Public Input

  • Who testified: Numerous residents from Port Townsend, Irondale, Brinnon, and elsewhere.
  • Substance of testimony: Public comment was split on location but united in the desire for a pool. Tri-Area residents favored a mid-county site for better access. Port Townsend residents raised concerns about losing a local facility and the climate impact of forcing city residents to drive. Multiple speakers opposed using public funds without exploring private funding and raised concerns about the regressive nature of a sales tax.
  • Intensity: The discussion was passionate, revealing deep divisions over location and funding fairness, balanced against a shared desire for the amenity.

Deliberation Insights

  • Delegation of Responsibility: The board's consensus was to create the PFD and delegate all major decisions—including site selection, design, financing, and operations—to the new entity's board. This shifts a politically contentious decision from the commissioners to a new, specialized body.
  • Funding Mechanism Lock-In: Deliberation treated the 0.2% sales tax as the settled funding source, with a projected $1.5 million in annual revenue supporting a $15 million construction bond. Alternative funding mechanisms like a property-tax-based district were dismissed.
  • Managing a Transition: The board explicitly asked the City of Port Townsend to continue subsidizing the old Mountain View Pool until a new facility opens, a process expected to take until 2028. This transfers the operational burden of the failing facility to city taxpayers for several more years.

Decision & Vote

Consensus support was given to proceed with forming a Public Facilities District. No formal vote was taken. (Sep 16)

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: The "Healthier Together" task force and advocates for a new pool, whose recommendation was adopted. A future PFD board gains authority over a major public project. Residents of the Tri-Area are positioned to gain a major community amenity.
  • Losers: Proponents of repairing the Mountain View Pool. Taxpayers who oppose a new sales tax. Port Townsend residents who will lose a walkable facility and continue subsidizing the old one for years before potentially paying a new sales tax for a facility they must drive to.
  • Fiscal Impact: The action creates a path toward a new 0.2% county-wide sales tax and the issuance of an estimated $15 million in public debt.
Strategic Implications
  • Proactive, but Delegated: The decision is a proactive step to address failing infrastructure. However, by creating a PFD, the commissioners have strategically outsourced the most difficult political decisions to an unelected (initially) or separately elected body.
  • Urban vs. Rural Tension: This decision directly confronts the urban-rural divide. It prioritizes a centralized location to serve the broader, dispersed county population at the expense of the urban center, which currently hosts the facility.
  • Risk Transfer: The county and city are transferring the financial and operational risk of a new aquatic center to the PFD and, ultimately, to the voters who must approve the sales tax.
Critical Gaps & Risks
  • Operational Funding Unsecured: The plan assumes a new facility will require a $500,000 annual operating subsidy. The PFD will be responsible for covering this, but there is no guarantee that sales tax revenues will be sufficient to cover both debt service and operations, especially during an economic downturn.
  • Private Funding Unexplored: Public comment highlighted that private fundraising was not seriously considered as a primary or supplementary funding source. The plan relies entirely on public taxation and debt.
  • Cost Estimates are Preliminary: The $15 million bond capacity is a high-level estimate. Actual construction costs, particularly with a costly septic system required at one potential site, were not established in the record.

3. County Increases Permitting Fees to Cover Full Costs, Shifts Fee Schedule from Law to Resolution

Topic

The board adopted an ordinance and resolution that increases the Department of Community Development's (DCD) hourly permit review rate from $111 to $123.20 and moves the fee schedule out of county code into a resolution, allowing for annual administrative updates.

Context

  • Fiscal Pressure: A consultant's fee study determined the county was not recovering the full cost of permit services, requiring a subsidy from the General Fund. The new rate is calculated to achieve 100% cost recovery as allowed by state law.
  • External Mandate: The fee increase is also a required step for the county to comply with new state mandates (SB 5290) that impose strict permit review deadlines. Adopting "reasonable fees" based on cost recovery is one of several efficiency measures the county must implement to avoid financial penalties for delays.
  • Regulatory Reform: Moving the fee schedule out of codified law and into a resolution streamlines the process for future updates, aligning with the county's stated goal of making its processes more efficient.

Public Input

  • Who testified: At a prior workshop, members of the public and the Home Builders Association expressed support for the concept of 100% cost recovery, contingent on DCD also improving efficiency.
  • Substance of testimony: Concerns were raised that a 100% cost-recovery model removes the incentive for departmental efficiency, as all costs are simply passed to the applicant.

Deliberation Insights

  • Efficiency Trade-Off: The board accepted staff's rationale that full cost recovery was necessary for departmental solvency and state compliance. DCD staff countered efficiency concerns by noting they had voluntarily reduced the estimated hours for several land use permits based on process improvements.
  • Reduced Legislative Oversight: The key procedural change—moving fees from ordinance to resolution—was framed as an efficiency measure. This shift reduces the formal public hearing and legislative process required for future fee increases, concentrating that authority with the board.
  • Affordable Housing Impact: During a prior workshop, commissioners noted the impact of higher fees on affordable housing projects but did not build any specific fee waiver or subsidy mechanism into this action. The problem was acknowledged but a solution was deferred.

Decision & Vote

  • Approved 3-0 an ordinance to remove the fee schedule from Jefferson County Code. (Aug 19)
  • Approved 3-0 a resolution to adopt the new DCD fee schedule with the $123.20 hourly rate, effective September 1, 2024. (Aug 19)

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: DCD, which is now fully funded for its permit-issuing operations without relying on the General Fund. County taxpayers who no longer subsidize development applications.
  • Losers: All applicants for building and land use permits, who will pay approximately 11% more per hour for staff time. This disproportionately affects small-scale residential projects and affordable housing developers.
  • Fiscal Impact: The fee increase will shift the full cost of permitting services, an amount not specified in the record, from the General Fund to permit applicants.
Strategic Implications
  • Proactive Fiscal Management: The action aligns departmental revenue with expenses, creating a more sustainable funding model for a core county service.
  • Tension with Housing Goals: Increasing the cost of permits is in direct tension with the county's stated priority of addressing the housing crisis. While ensuring DCD is solvent, it raises the cost of building all housing, including affordable units.
  • Shift in Governance: Moving fees from ordinance to resolution is a significant governance shift. It prioritizes administrative efficiency over the friction and public scrutiny of the formal legislative process for future fee changes.
Critical Gaps & Risks
  • Affordability Measures Absent: The board approved the fee hike without a corresponding policy to mitigate its impact on affordable housing projects, creating a direct conflict between its fiscal and social policy goals.
  • Incentive Structure: The new model still lacks a strong incentive for DCD to reduce permit processing times beyond the threat of state-mandated penalties. The department is now guaranteed revenue to cover its costs, regardless of efficiency.
  • Vulnerability to Market Downturns: While achieving 100% cost recovery, DCD's budget is now entirely dependent on the volume of permit applications. A construction slowdown would directly impact departmental revenue and staffing.

4. Board Rejects Gasoline Truck for Fire Marshal, Forcing EV Policy Confrontation

Topic

Commissioners approved funding for software and safety equipment for the Fire Marshal's office but explicitly rejected a request to purchase a gasoline-powered Ford F-150, directing staff to return with an electric vehicle (EV) option.

Context

  • Stated Climate Goals: The county has formally adopted aggressive climate goals and has a stated, though uncodified, priority of transitioning its vehicle fleet to EVs.
  • Operational Concerns: DCD staff and the Fire Marshal argued for a gasoline truck based on operational needs. They cited the limited range of the electric F-150 Lightning (127 miles when loaded), the lack of charging infrastructure in rural and west-end areas, and the risk of power loss during a disaster response.
  • Fiscal Pressure: The requested vehicle and upfitting totaled nearly $68,000. This was a new, unbudgeted request requiring a third-quarter budget appropriation.

Public Input

  • Who testified: Tom Tiers.
  • Substance of testimony: Supported the board's rejection of the gasoline vehicle, arguing that the concern about power outages was invalid because gas station pumps also rely on electricity.

Deliberation Insights

  • Priorities Clash: The deliberation revealed a direct conflict between the county's stated climate goals and the operational concerns of a public safety department.
  • Frustration with Inaction: Commissioners Dean and Eisenhour expressed strong frustration that another department was proposing a fossil-fuel vehicle, signaling a lack of institutional commitment to the EV transition. Commissioner Dean stated the purchase went against the county's "commitment to fleet electrification."
  • Policy Mandate Issued: The board used its power of the purse to enforce an unwritten policy. By denying the funding, they effectively mandated that the department procure an EV, regardless of the operational challenges cited by staff. The board also directed staff to schedule a workshop to create a formal county-wide EV policy.

Decision & Vote

Approved 3-0 a motion to provide up to $17,000 for equipment and software for the Fire Marshal's office, while explicitly deferring the vehicle request. (Aug 5)

Impact & Analysis

Immediate & Long-Term Consequences
  • Winners: Climate advocates and proponents of fleet electrification. The decision sets a firm precedent for future vehicle purchases.
  • Losers: The Fire Marshal's office, which is delayed in acquiring a necessary vehicle and must now adapt its operations to the limitations of current EV technology.
  • Operational Impact: The Fire Marshal must now develop operational plans that account for the range and charging limitations of an EV in a large, rural county, potentially affecting response times and capabilities in disaster scenarios.
Strategic Implications
  • Proactive Policy Enforcement: This decision is a rare example of the board proactively enforcing a strategic goal (climate action) over departmental preference and convenience. It demonstrates that stated values can, in specific instances, override operational inertia.
  • Alignment of Spending with Values: The board directly aligned its spending decision with its adopted climate goals, rejecting a proposal that was in conflict. This action forces the development of a formal policy that was previously just a stated preference.
  • Economic vs. Environmental Tension: The decision prioritizes long-term environmental goals over the short-term economic and operational efficiency of purchasing a conventional vehicle.
Critical Gaps & Risks
  • Lack of Formal Policy: The conflict arose because the county lacks a formal, adopted EV fleet policy with clear exemptions and criteria. The board's ad-hoc decision created policy through a budget denial, a reactive way to govern.
  • Infrastructure Gap Unaddressed: The decision forces the adoption of EVs without a corresponding, funded plan to build out the necessary charging infrastructure, particularly in the rural and west-end areas where staff raised the most significant concerns.
  • Operational Risk: The board dismissed staff's concerns about vehicle range and reliability in emergencies. If an EV fails to perform during a wildfire or other disaster due to these limitations, the county bears that risk. The record does not show a serious analysis of this risk.