Annexing Klahanie and 12 surrounding neighborhoods would produce about $620,000 in net income for Issaquah, before taking into account start-up costs and a sales tax-credit from the state that the city of Issaquah will have to apply for.
Issaquah would gain about $6.47 million annually from additional property tax, some sales tax, state-shared revenues, utility taxes and real estate excise tax. Cost to the city to service the new areas would be about $5.85 million.
The results of a comprehensive study done for the city by Tom Nesbitt, of Nesbitt Planning and Management, Inc., along with independent consultant Cynthia Stewart, were revealed in the first public presentation May 8 at Issaquah City Hall. Nesbitt and Stewart have been receiving feedback for several months from a volunteer task force appointed by Mayor Ava Frisinger.
The City Council will decide if it will put the issue before voters.
The last time this annexation was proposed, in 2005, the ballot was split into two parts. First was to annex or not, and the second question was whether Klahanie agreed to assume Issaquah’s debt. The first part passed, the second did not. The question will not be split this time.
About 25 people turned out for the presentation. The area of about two square miles has a population of 10,843. If approved, it would increase Issaquah’s population of 31,150 by about one-third.
Nesbitt said the big three costs are police, fire and roads. In the event of a fire, he said the same fire trucks will be going to the same places as usual. Eastside Fire and Rescue will continue to provide service, although an inter-local agreement with EFR expires at the end of 2014.
“Each jurisdiction pays a percentage share of the cost for each station, providing service to that jurisdiction,” Nesbitt said. “EFR will get the same money, Klahanie will pay the same.”
Road conditions in Klahanie are steadily getting worse, the study said. With a new road having a score of 100, pavement conditions in Klahanie have dropped from 83 to 70 since the last study in 2004. In contrast, Issaquah roads have improved from 74 to 76 Stewart said, since the city has shown to take better care of its roads than the county does.
Police calls are difficult to predict, but the department records every call, and pinpoints the their exact longitude and latitude. Nesbitt said there were 10,000 calls last year.
The revenue figure includes money that would be generated if Issaquah were to receive the state annexation sales tax credit. The cost figure includes $6.08 million in one-time start-up costs that would be amortized over the first five years. After the costs are paid off, the annexation would generate a surplus.
One resident of Klahanie asked if Issaquah Police would have a substation in the area. Issaquah Police Chief Paul Ayers, who was in attendance, said they haven’t made it that far yet in the decision-making process, but that they would make their presence known.
With annexation, Klahanie’s levy rate is expected to drop, which would result in the owner of a home assessed at $320,000 paying $383 less in property taxes.
There will be another public meeting at 7 p.m. May 22 at Challenger Elementary School, 25200 SE Klahanie Blvd. From there, the Issaquah City Council will decide whether or not to put the issue on the ballot.
For a look at the full report visit www.issaquahwa.gov/klahanie.