To spend or not to spend? That was the question being pondered by City of Sammamish councilors at Monday night’s capital project budget study session.
In a time of falling property values and construction costs, but also falling revenues, the city is considering whether now is best time to spend a significant proportion of the more than $10 million the city has in savings.
The views of the councilors themselves were a mixture of opportunism and caution, aware that the economic future is unclear and conditions could in fact get worse before they get better.
Financial Services Director Lyman Howard said the council would do well to avoid any expenditure that would be attached to ongoing costs in the future.
“If the council chooses to avail themselves of the $10 million, I would advise that it be spent on a one time project,” he said. “We don’t want to increase ongoing operations and maintenance costs, as this would come out of the general operations budget.”
Following Howard’s suggestion of a one-time spend, the purchase of a site for a teen or civic center dominated the council’s discussion.
“The bad news is that property values are down,” said councilman Lee Fellinge. “The good news is that the property values are down. Maybe now is a good time to acquire the library. This could be a one-time opportunity to get a good deal.”
Fellinge was referring to the Sammamish branch of the King County Library on the corner of 228th Avenue NE and NE Inglewood Hill, which will become vacant sometime in early 2010 with the completion of the new branch facility currently being built next to Sammamish City Hall.
The King County Library System (KCLS), which owns the building and land at the current site, hopes to find a buyer for the property.
Should it want to purchase the property, the city would be asked to pay “market value,” which, given the current state of the real estate market, would probably be less than when it was last assessed in 2007.
That assessment priced the land and building at about $5 million.
Fellinge prefaced his excitement for the purchase of the library with more conservative thoughts.
“We should to be cautious about feeling like we need to go out and spend this money,” he said. “I would rather we keep our powder dry for a while. It is questionable as to how quickly the economy will recover. I would advocate that we retain a significant portion of the $10 million.”
Councilman Jack Barry agreed, saying that there was danger in proceeding too quickly, particularly in light of the projected cross-over point in expenditure and revenue in the next four to six years.
Councilor Kathy Huckabay agreed that the city should be looking at securing a site for a future center, and said she hoped to see such a center on the Sammamish Commons. She suggested that the city could perhaps buy the land now, while prices were low, and proceed with construction later.
