Community Budget Forum - Regular Meeting

Good morning, everyone. Snohomish County Council has called to order for our finance budget and administration committee. Today is Tuesday, 12/09/2025 at 10AM. We're meeting in the Jackson Boardroom and also remotely. I'll read our script for public comment, and then I'll ask our clerk to take role. So we'll take public comment beginning in person and then remotely. On Zoom, click on the high hand icon to raise your hand. If you're calling in by phone, press 9 to raise your hand or and then press 6 to unmute. Each speaker will have three minutes to speak, and please start your comment with your name and state of residence. Next is roll call.

Committee Chair Dunn. Here. Vice Chair Nearing. Committee Member Lo.

Present.

Committee Member Mead. Committee Member Peterson. Here. Chair, there are three members present.

Thank you. Next is, public comment. Does anyone wish to provide public comment today? In person, you'll use the podium. Okay. I'm not seeing anyone, and I don't see any hands raised online. So we'll close public comment, and we have three action items, and then we'll have our discussion item. So, first is item one, motion 25 dash five one seven.

Thank you, chair Dunn. Good morning, council members. For the record, Jim Martin, council staff. Closed motion 25 dash 517 requests a cancellation of just over $1,000,000 of uncollectible accounts from the county's accounting records. Collection agencies have determined that certain delinquent accounts are uncollectible for various reasons, such as bankruptcy, death, statute of limitations of six years, or other appropriate reasons. Requested action is to move to GLS on December 10 for consideration.

Any questions from council? K. Any objection to consent? K. Hearing none, this will move to the consent agenda for tomorrow. Next is motion 25 Dash five zero six.

Post motion 25 Dash five zero six approves the interlocal agreement between Snohomish County and the city of Everett for animal shelter services and authorizes the county executive to sign the agreement. Scope of services include lost and found inquiries, referral for animal control, shelter animals of facility operated by Everett, return of animal to owners, deceased animal disposal, and microchipping of animals at time of owner reclamation. Term of the agreement is through 12/31/2026, and requested action is to move to GLS on December 10 for consideration.

Questions from counsel? Objection to consent. K. Hearing and seeing none, this will move to December 10 for, consent. And next is item number three, motion 25 dash five four eight.

Post motion twenty five dash five four eight approves the 2026 local hotel motel fund expenditure plan. The Snohomish County lodging tax advisory committee evaluated the applications for eligibility and recommended funding levels for the projects. Twenty twenty six recommendations total $502,805, and the motion also authorizes the executive director's signature authority to sign the agreements on behalf of Snohomish County. Requested action is to move to GLS on December 17 for consideration.

Okay. Any questions from council members? Okay. Any objection to consent? Hearing and seeing none, this will move to the consent agenda for the seventeenth. That concludes our action items, and we have a discussion item for our, to hear from our public facilities districts. So everyone can come up to the table, and, I think everyone has their own presentations. Yep. But I'll let, Jim introduce the item.

Just gonna say today, we're joined by representatives of the Forest and Homish County Public Facility Districts for their annual report to council. I'll let each of the representatives introduce themselves, and welcome to the table. Not sure what order they wanna go in, but I leave that to their discretion.

I'll go for it since you're looking at me. I am, Janet Pope, executive director of the Lynnwood Public Facilities District.

Dave Hamilton. Hamilton. I'm the chairman of the Public Facilities District.

Corey Margolis, general manager for Angel in Owens Arena in Everett Public Facilities District.

Laurie Maher, associate executive director for Edmonds Center for

the Arts, Edmonds Public Facilities District. Emily Phillippe, airport deputy director, Snohomish County, Paine Field, and here jointly, with Boeing as well for the future of flight.

Thank you.

I think I was supposed to sort of kick this off. So I'm Dave Hamilton. I'm the chairman, and we do have a full, complement of board members now finally. It took a while this year, but thank you for getting us a full deck. And so, I'm the president at this point in time. We have David Schafer from Edmonds who's just recently appointed. We have Alicia Crank. We have Gary Weichel and Terry Quick. And Terry is in the audience with us here today just for information. And, we meet quarterly, and we allocate a couple million dollars to the people here at the table that spend it. So and we've had a good year. Things are pretty consistent.

Great. Thank you. Any questions? Okay.

And then we have the future reply. Yeah.

Yeah. I'm happy to kick it off. Again, Emily Philippi, one of the airport deputy directors. Before I jump into it, I do have a correction, to the packet that I'd like to physically, hand to you, if that's alright.

Oh, you can give it

to the clerks. Okay.

So what you'll see in the correction, is specifically to on the budgeted amount, for the airport revenues. And then you'll see, the variances of the budget amounts are much more congruent and, I guess, leveled out. In the packet that you have, you see it's a negative 9,000 budget variance, which I am happy to report is not correct. You'll see a lot more leveled out of of a 4.8%, variance of what what we budgeted versus what was the actual for 2024. And the airport and Boeing have a very unique relationship, with the future of flight.

Since 2018, Boeing has fully taken over the future of flight, fully operated that facility. And what the airport, they take all of that leased revenue. So it's a land lease that we have with Boeing. We take all of that lease revenue along with the PFD funds that we receive, and then we pay off all of the bond revenues that we have. So today, we have just under, 13,000,000 of left in those bond revenues, that we pay off with all of those funds that we received that we're very, very grace graceful grace grateful for.

Thank you. And then I will turn it over, to our partnership that we have with Boeing, to kinda go over all of the highlights, and the wonderful things that they have done, in 2024 as they do all of the operations of that facility. So I'll, hand it over, to Christy. Thank you.

Good morning. Christy Medlin. I'm general manager for Boeing Future of Flight. Thank you, Emily, for the wonderful introduction. In 2024, we had some really nice highlights and investments, for our public operation.

We received over a 140,000 visitors, and that was a really nice upturn from 2023. This was largely, spurred on by the relaunch of the public tour program in 2023, if you guys will recall. And so it was nice to see a return, of our fans and our global audience. About 25% of our visitors, typically are international, and that was the case last year as well. And so in terms of additional investments, we were able to add to our gallery.

You can see that we have, something called the Whisk product, which is a new cutting edge autonomous air taxi program so people could see the different prototypes available in real life and actually have aircraft in the gallery. And we also, finished out, the work on our tour balcony over at the factory with some interesting displays that really add to that storytelling about air airplane manufacturing. A deep investment that we really needed to do, and we're so excited that it is working out well, is, with our ticketing system, a platform called Ticketure, and that has enabled us to modernize, and create, a really, detailed online ticketing, and visitor journey, that really, promotes our business better and, again, improves our reputation reputation in in terms of modernization, for people planning their visit to us. Another highlight is, as far as events, we were able to, have some sponsorship for an activity at the Oshkosh air show, which is the biggest domestic air show. And so we got our name and organization in front of over 600,000 visitors.

So this year is going very well. We have opened to seven day operations, so expect that attendance number to go up and are making some exciting investments in the gallery and the infrastructure that we look forward to telling you about.

Thank you.

And then we have Corey with

Alright. Thank you. Thanks for having us here. Nice to see you all. 2024, I know it feels very in the past at this point, but it was a very strong performing year for the facility and set a new record for the venue's highest net income in its history.

Operating income for the facility, had a gain of $773,000 which was $1,100,000 higher than the operating loss of the prior year. So combined with all the operating district incomes resulted in a net increase in assets of close to $3,700,000 prior to depreciation, which was up over $800,000 from the prior year. Some of the highlights, the Everett Silvertips, the team was first place in the entire Western Hockey League for the season, a little earlier than hoped playoff exit, but we're trending strongly again this year. Their sales efforts have continued to be strong, including substantial growth from Aronof County, which is bringing visitors down into our our area. We had 10% growth in ticket sales, 11% in paid ticket sales, and 13 increase in in regular season attendance over 2023.

So they the SilverTips brought in about a 160,000 guests to our facility. Although it was the start of the year in '24, we also set the venue record for a number of people in the building for one event day and the highest single event day sales in the venue's history with two sold out performances in one day with Nate Borgazzi. As well, professional bull riding continues to be a really strong annual event, and we saw a 10% increase in sales over 2023 and a a 19% gross increase. Then we also partnered with Apex Everett and Everett Music Initiative to facilitate the first ever Everett Stampede Week, turning our annual PBR event into a weeklong full community event. And this is, the Stampede Week, something we've continued, since then, back in, this past February, and we'll continue for the upcoming February event as well.

Hot Wheels Monster Truck Live performed for the first time in the venue since it's performed a second time as well. In its first year, it had three sold out shows welcoming over 14,000 guests. This has now become another annual event for our area. Additionally, WWE returned to the venue for the first time since 2020 for a sold out nationally televised internationally televised event. And we had several strong concerts, including John Pardy, Riley Greene, Shriya Ghoshal, Ice Cube, Dwight Yoakum and Summer Worship Nights with Brandon Lake and Phil Wickham.

Our event income growth in 2024 was 63% from the prior year and was far and away the strongest event year in the venue's history. We should match it and slightly exceed it this year, anticipating a bit of a decrease next year, just with some of the market trends in the in the concert touring market. The Community Ice rink also had over 120,000 on ice users in 2024. And one of the big projects we we unveiled in 2024 was a partnership with Seattle Junior Hockey Association, and our Everett youth hockey program to have an alliance to share the resources, streamline operations, and enhance the development opportunities while still maintaining each program's unique identity. For us, the junior SilverTips at Everett Youth Hockey and then the junior Metropolitans for Seattle junior hockey.

The partnership has grown the sport and done a really good job of focusing on the hockey opportunities specific to Snohomish County, which was a goal of ours. In this current season, 87 of our participants live in Snohomish County. So that was really something we didn't want people driving past or through our county to go to, whether that's cracking community ice and things like that. We think us and the Seattle junior folks really wanted to to be the spot to be and and and are seeing good success with that. From a capital perspective, we concluded several projects, including new 200 level club seats, LED lighting in our community ring, and have since completed suite furniture upgrades, a new PA system and some HVAC renewals, spending close to $1,600,000 on improvements in 'twenty four.

We recently had a facility condition assessment conducted by MEG analysis to just help us capital plan over the next number of years. The report states over in the two arenas about $7,600,000 of work to be done to correct efficiencies in the next five years, plus $137,000,000 predicted over the future life of the facility through 2044. Conference Center, which is a city owned asset but operated by the PFD, has close to $18,000,000 of predicted renewals throughout the future life of the building. Beyond that, we'll also need to do other improvements to just keep the building current to attract high level entertainment and events. We are also spending considerable time and planning financial resources for compliance to this clean buildings, performance standards through Washington State.

We had a ASHRAE Level two audit completed early this year and are focusing on the investment criteria pathway and the investments we'll need to make to be compliant. Some of the final data is we our location based data shows close to 900,000 visits made to the Everett Event Center in 2024, which is a 29% increase from 2023. And with this strong operation, it allowed us to also continue to pay down some of our debt and outstanding prior previously unpaid debts that the city held on our behalf. In 2024, we paid $2,250,000 towards a deficiency loan that we had with the city, and the remaining balance at the end of the year was $5,000,000 Total debt that the city holds and that the PFD holds is close to $35,000,000 $32,000,000 So this yes, we had a phenomenal year for that generated strong cash flow, and this has enabled us to continue to make the necessary investments and hopefully become more current in our outstanding debt obligations. So we're going to strive to continue to have that operation that can support the substantial upkeep required of the facility as we approach 25 years of age, and we'll continue to take pride in serving about 1,000,000 people every year that come from the county, but also those that travel from out of market to spend money and enjoy our community.

Lastly, thank you all for your support, and providing the essential funding opportunities so we can continue in our mission. Thank you.

Thank you. Questions? Councilmember Lowell?

Yeah. It sounds like we need to invite Nate back for a few more, shows to keep us going. I know he was just recently in Seattle. So the debt, will we anticipate any payments for 2025 on the debt?

Well, the PFD has its own debt that we are we always have we're required to pay. And then as far as repayments to the city for the deficiency that we have, I think we're up to about $2.8500000.0 in 2025 that we're anticipating to pay towards the city. So we'll the city debt and interest, like, principal and interest is about 2,000,000 every year. So by paying a little more, we're whittling down our our deficiency loan slightly.

Any other questions? Okay.

Okay. So then Edmonds Center for the Arts, we have Laurie.

Hello. Good morning. Thank you for the opportunity to share highlights for Edmonds Center for the Arts. ACA is owned and operated by Edmonds Public Facilities District. And we renovated and opened in 2006 on the original Edmonds High School campus, so a little bit of history there.

ECA continued to see recovery in attendance and demand for the arts in 2004. Our ticket sales grew 24% over the previous year, reaching more than $3,200,000 in total operating revenue or 94% of our budget. Serving nearly 90,000 attendees, this growth shows that audiences are continuing to return and that ECA remains a trusted and vibrant cultural hub for the region. Rental activity also continued to grow. ECA generated $794,000 in rental revenue, a 7.6% increase over 2003.

These rentals, they come from community groups, schools, arts organizations, and multi day clients, which not only support our earned revenue but also drives tourism and expands ECA's visibility throughout Snohomish County. Education and community engagement remains central to our mission. In 2004, thousands of students, families and community members participated in our school matinees, workshops, sensory friendly events, artist residencies, and programs created through local nonprofits and educators. One of our major highlights is Kids Talk. It is a free annual community arts celebration, and that event alone welcomed over 2,000 attendees showcasing broad regional reach and reinforcing ECA's role as a resource for families in our county and beyond.

Operationally, ECA continues to maintain strong budget discipline. Expenses came in 3.2% below budget even as we managed inflation, rising production labor costs and challenges of operating a historic facility. As with similar performing arts centers across the nation, we continue to operate with a deficit reflecting supported by a mix of earned revenue, contributed revenue and public funding. County support remains essential. Our non operating revenue, including lodging tax, grants, sales tax rebate and the Snohomish County PFD distribution, plays a critical role in maintaining our operations, supporting tourism and meeting long term debt obligations tied to our original renovation.

In 2024, ECA generated more than three fifty hotel room nights through our Present Event series alone, with many more created through rentals, education events and partnerships. Looking ahead, our most urgent challenge is the condition of our aging campus. Major building systems HVAC, electrical, life safety, theatrical, and accessibility systems are at or near end of life. Long term facility planning and a recent Building Envelope and Seismic Assessment planning shows the need for substantial investment to protect safety, ensure operational continuity, and maintain ECA's competitiveness as a regional, cultural, and tourism destination. Finally, in moving just a little bit ahead into 2026, ECA will begin implementing its five year strategic plan.

And this plan focuses on strengthening financial sustainability, addressing critical capital needs, and reinforcing ECA's role as a cultural, economic, and accessible resource for Snohomish County. In addition, we are entering a leadership transition with the hiring of an interim executive director who will support both EPFD and ECA while we conduct the search for our next long term executive director. This will help ensure stability and forward momentum during this important period of change. Thank you for the partnership from the county and the city of Edmonds, as we move forward into our next chapter with focus and resilience. Thank you.

Thank you. Councilor Merlot?

Yeah. So the only thing I don't see in here is, I I see the expenses. I see the income. I don't see how much, loss. So do you have a final amount of, of the negative budget number on that?

I did not bring that with me. I believe last 2024, we had an operating loss of $696,000 But with nonoperating revenue support, I believe it was around net of $120,000 but I could provide that information subsequently.

And then are we expecting something similar for 2025?

We're actually showing improvement year over year. We're anticipating an operating loss of 488,000 for 2025 and are projecting a loss of $312,000 for 2026. So continuing to make improvements through streamlining our expenses, looking at our operating models and, of course, the utilization of the non operating revenue to offset.

Thank you. You're welcome.

Is that included in the financial, information that's online? Do you happen to know, Jim? We have financial reports that may have that included. Other questions? Okay.

Okay. So now we'll move on to Janet Pope, who who is with the district, the Linwood Public Facilities District.

Good morning, and thanks so much for having us. We sure appreciate this opportunity and really appreciate, the support. So, in our financials, on on paper, it certainly looks like a really great year in that we, ended the year $2,600,000 above budget. In full transparency, that's more like $400,000 above budget because we did do a prior period adjustment that we've moved far long enough in our master plan and the nearly $5,000,000 of operating expenses that we've invested in that master plan that, working with our municipal advisers, we created a construction in progress account. So, basically, a a strong capital account, for that.

The district as a whole has super strong cash flow. We've never had to touch our reserves. We have, millions of dollars in addition to our reserves at this point, so that is all super strong for the PFD as a whole. The event center is, progressing in all the areas you you I think for the basis of this funding that are really essential in terms of the increase in the economic impact and the attendees and the impact that we're having on the city. We're still struggling a little bit in that net income area, but it is reducing, improving year over year.

And a lot of that is because we are such a strong food and beverage facility. And, of course, food and beverage has gone up a lot as well as the labor pools that have gone up a lot. But these are all things that we're to address in the master plan and really meet those pain points of, you know, what's stopping people from coming to our facility. We know that it's still, the lack of a hotel, the lack of the walkability in Linwood, some of the sustainability, and what are the things we can do. So those are all the pain points that we're addressing in the master plan that are all happening at a really exciting time in Linwood and, moving forward to create that heart of Downtown Linwood and, taking leverage of the light rail.

So we also, in advance of that, have expanded our, public benefit events. Our Lew House, Linwood Lew House, 3,500 people this year. Those continue to grow. We're starting to get a lot more inquiries about the indoor outdoor festival pieces, and the other real public benefit things we can do. We're really looking at it being a, public resource as well for World Cup coming up and establishing a lot more entertainment based piece to become an entertainment district in Linwood as well.

So summer concert series is things like that moving forward. One of the things that really does help our bottom line, of course, is that we do have retail, and we have that income on the property even though our nineteen sixty zero strip mall buildings are are really going downhill fast. So things like elevators that you can't find parts for anymore and and those kind of things. So, again, I think our financial health is is really strong given those drains on our resources, but we're still moving forward with that. We had some great success this year on the master plan and that we did complete a development agreement with the city of Lynnwood that enshrines all our entitlements for fifteen years.

We received predevelopment loan, from the county, which we are also very excited about. On behalf of our municipal advisers, we paid down using those loans, we paid down a lot of our prior debt, which free us up a lot of constraints to move forward with our financing for the master plan for in the future. So that was exciting as well. And then, we worked very closely with the city too on the Ring Road, which is gonna go around the edges of the property. So that's a complex financing project, but getting all the details around that.

And we no announcements yet. We but we have made significant progress with a housing partner who we will be able to do a 100% of workforce housing in, for 400 units. So super excited about that as well. Other good news is we did secure in, 2024, 400,000 from the state of Washington capital budget. And this year, we secured an additional million dollars in the state capital budget.

We don't plan to be going in for 2026, but stay tuned for 2027 and looking at those kind of things. We're working very hard on the future operating pro form a and how are we gonna be afford to pay off that future debt. It's looking pretty solid and secure with those types of things, and as I said, moving forward with the private partners on the hotel as well. A couple other really exciting things that are happening is we are now a Red Cross disaster site, and thanks again to council member Megan Dunn who helped us with a lot of that disaster resilience pieces and Snohomish County disaster as well. So we're open.

Should there be a fire or something like that in Lynnwood, the building will step up just to help serve the community in that way and then also has a smoke and heat shelter in the future. And this is all part of the getting us ready for the future master plan where we really hope that we can be that major emergency disaster resilience plan, and how do we design for that in advance. Another piece is that with the city of Linwood, we are really making progress now in a strategy partnership with the hoteliers to develop South Snohomish County as a destination management organization with us focusing mostly on the group sales and the city of Lynnwood focusing on the individual group tourism. And it's really working out really well as a nice partnership, and the hoteliers are getting very excited about it with Linwood having more hotels than a lot of those other folks, so other cities around the area. And I think that's about it.

Thank you. Questions? Councilor Merlo?

So, obviously, you've been very successful with the capital budget request in Olympia, and and, obviously, my partner to the left and I are happy to support that. Do you have any advice for Edmonds or some of our other, areas on how they can be successful in getting some of these dollars from the state?

I would say build build those relationships with folks like yourself and have that advocate advocacy down there, have that kitchen cabinet. We have invested considerably as our master plan expenses, which you cannot capitalize, which is in the advocacy pieces and just really understanding how it works. Representative Rio was extremely helpful to us down there this year and as well as Lauren Davis in in getting things as well as Strom. I think, signed on to a few things too. So yeah. So it it's I think just investing in how the system works and the way you need to be down there and and stating your case.

Yeah. Those relationships matter, and letting legislators know what those needs are really help and go a long way. So so thankful thank you for your success, and hopefully, it'll help some of our other, facilities. Thank you.

Okay. Any county related questions? Okay. I appreciate the work on the Red Cross emergency, sheltering and, the workforce housing. It's great to have that.

So thank you for your time letting us come and tell our story, and we'll be back next year.

Yeah. So, typically, this is your annual update. Would it make sense? Because most of the information was for 2024. Should we have it earlier or in quarter two next year?

I think I think that's typically what it's yeah. Think it'd

be Okay.

It's usually been in July, and I think with the change in staff and so on, I think we missed our our opportunity. That's why it's so late this year.

No worries.

So you'll see us in six months.

Can make it. Perfect.

It's our 2025 data. Okay. Great. Hey. Thank you.

Thank for your time. And that concludes our agenda, and council's adjourned for the day.