Puyallup City Council Budget Study Session – October 14, 2025

The Puyallup City Council held a budget study session on Tuesday, October 14, 2025, from 6:30 p.m. to 9:28 p.m. in Council Chambers, 333 S. Meridian. The session covered proposed 2026 mid-biennium budget adjustments, Finance Director overview, City Manager staffing and capital requests, Lodging Tax Advisory Committee (LTAC) recommendations, community grants, council initiatives, and an accelerated Capital Improvement Plan (CIP) review. The council unanimously approved the agenda and suspended rules to add the October 15 agenda items to the same meeting. No final budget votes were taken; first reading was set for the following week. Note: The raw transcript opens by saying October 8, 2024, but the agenda, minutes, and meeting date supplied identify this as October 14, 2025; this summary follows October 14, 2025.

Finance Director Overview

• Finance Director Barbara Lopez said the adopted 2026 budget of $157.2 million would rise to about $169.5 million under proposed adjustments. The transcript also contains a $159,227,662 adopted-budget figure, but minutes and the presentation used $157.2 million.
• Adjustments include updated labor matrix costs, moving Transportation Benefit District funding into a special revenue fund, transferring $2.6 million of excess general fund reserves to Tier 3, adding $908,990 of ARPA interest earnings to Tier 3, and updating LTAC, capital, and operations budgets.
• The estimated 2026 property tax levy is $11.4 million, based on the 2025 levy of $11.2 million, the 1% statutory increase, and new construction. Assessed valuation is $10.9 billion, up about 5%, producing a general levy rate below $1.05 per $1,000.
• Tier 3 has about $3.5 million available; proposed spending is $2.3 million, leaving $1.2 million. Councilmember Whitting expressed concern about the low remaining balance. Lopez noted the general fund still holds $9.1 million in regular reserves and that the apparent double-counting of Tier 3 spending reflects accounting rules requiring transfers to be recorded as expenditures.

City Manager Recommendations

• City Manager Steve Kirkelie requested adding a Parks and Recreation Custodian at a total cost of $108,000. No custodian has been added in over a decade; the city has five custodians for 17 buildings and 186,000 cleanable square feet, about 37,000 square feet per custodian, placing the city at cleanliness level four on a five-level industry scale.
• He also requested an Office Assistant for the Police Department, funded by reallocating $84,000 no longer paid to South Sound 911 for warrant entry. The position would free records specialists from front-desk interruptions so they can handle body-worn and in-car camera footage workloads.
• Facilities Lead Jess Marshall presented a $3.3 million phased library HVAC replacement: Phase 1 covers internal heat pumps and controls, with completion expected by summer 2026; later phases address boilers and the cooling tower. The existing 20-year-old system has leaking coils, failed equipment, refrigerant phase-out issues, and caused cooling outages. Councilmembers stressed keeping the library reliable as a community cooling center. Councilmember Johnson and others questioned the ESCO/state procurement process; staff said the model supports grant opportunities and that multiple contractors will bid on implementation.

Lodging Tax Advisory Committee (LTAC) Recommendations

• Councilmember Door recused herself and left the room, disclosing her new position with the Puyallup Main Street Association. Mayor Kastama also said he would abstain from the next week's LTAC vote because his wife is a Master Gardener.
• Councilmember Witting, chairing LTAC, reported $2,492,000 in requests against $2,348,000 available, compared with $2,750,800 awarded in 2025. The committee recommended fully funding the new Master Gardeners Association request as a one-time grant to move its plant sale to the fairgrounds, with proportional reductions to other applicants.
• All Things Fun Sports would receive $8,300, down from $8,800. Councilmember Johnson questioned equitable access and whether the city gives favorable treatment to long-time recipients; Witting noted All Things Fun Sports documents visitor recruitment and that successful runs move toward self-funding. Council also sought information on how dependent Main Street and the Chamber are on LTAC funding.

Community Grant Funding

• Councilmember Witting recused himself due to personal conflicts with applicant organizations. Mayor Kastama presented the community grant recommendations.
• According to the mayor, requests totaled $279,500 and the committee recommended $179,500; the minutes list requests as $209,500. Recommended recipients were All Saints Community Service, Helping Hand House, Mi Casa, Communities in Schools, Puyallup Food Bank, St. Francis House, Valeo Vocational (full $30,000 request), and the YMCA Teen Late Night program on South Hill.
• Council asked whether the YMCA funding is for startup costs of a year-round program rather than a one-time event, and Councilmember Door raised the legal requirement that gifts of public funds serve the poor and infirm. The City Attorney agreed to review the YMCA application for compliance before the next meeting. Councilmember Gilliam described the late-night program she formerly directed. Councilmember Adler suggested improving application and post-award reporting practices. The mayor promised attorney review and performance monitoring.

City Council Initiatives

• Mayor Kastama proposed a $50,000 LTAC placeholder for a feasibility study with Washington State University to convert the historic barns at the WSU Puyallup Research and Extension Center into a conference facility. Councilmembers were supportive but asked for a firm WSU commitment, possibly a council delegation to Pullman, alumni involvement, and LTAC committee review before final adoption.
• Mayor Kastama also proposed a $250,000 placeholder for a July 4, 2026 celebration of America's 250th anniversary, including a patriotic car cruise, Pioneer Park gathering, enhanced Red, White, and Kaboom event, and a monument. He said the state has no dedicated funding. Council discussion raised concerns about World Cup crowds, the need for LTAC input, police and public works overtime costs, regional/statewide partnerships, and possible federal support. The mayor withdrew the placeholder to refine the budget and return later; he noted the budget can be amended after adoption.

Capital Improvement Plan Overview and Updates

• Capital Division Supervisor Drew Young reported the citywide Pavement Condition Index is 73, with 66% of streets in very good condition. In 2025, the city completed 1.3 miles of overlay and 13 lane-miles of chip sealing. The Street Saver program puts the city in the 75th percentile compared with similar agencies, whose average PCI is 75.
• Project updates included the 9th Avenue SW festival street, about 92% complete and expected to open in November once pedestrian lights arrive; full reclamation of Inter Avenue Road; the 23rd Avenue SW Loop Trail sidewalk link; and the 39th Avenue water tank recoating and seismic retrofit, supported by a FEMA hazard mitigation grant exceeding $3 million.
• Young reported about $4.27 million in grant support for 2025 capital programs, plus new grants including a state Ecology streamflow grant for 27th Street culvert replacements and a US DOT grant for the South Meridian overlay. A $3 million TIB grant is pending for 9th Street SW overlay.
• Proposed 2026 adjustments include reallocating $400,000 to 9th Street SW overlay, $100,000 to 7th Avenue SW, $1.5 million in LTAC money to Meeker Street improvements, $85,000 in sewer funds to Meeker, $300,000 to Maplewood water main work, $500,000 in additional FEMA funds for the 39th Avenue tank, and $152,000 to 4th Street NW storm work. About $9.6 million in grants is forecast for 2026 construction, including Meeker Street and 9th Street projects.
• Councilmembers asked about grant advocacy and project timelines. Councilmember Whitting said Puyallup had historically been underfunded by Pierce County Regional Council scoring compared with cities such as University Place, and that better project selection and engagement have improved results.

Traffic Safety Discussion

• Council discussed speeding in residential areas, especially during commuter hours. The mayor said he wanted to increase use of the traffic calming fund; staff reported about $300,000 in fund balance and no 2026 appropriation. Estimated costs were $20,000 to $25,000 per speed table and $100,000 or less for a neighborhood roundabout.
• Councilmember Witting recommended low-cost measures such as speed limit reductions and lane narrowing. Councilmember Johnson asked about speed cameras in school zones and parks; Police Chief Engel estimated current red-light camera revenue at about $2.1 million per year from 16 approaches and said state law requires a study before adding speed cameras. Councilmembers supported a future traffic-safety study session and possible dedication of camera revenue to traffic calming. No decision was made.

Public Comments & Testimony

• Andrelyn Izquerido, a Pierce County District 2 resident and Master Gardener since 2020, spoke in support of the Master Gardeners Association move to the Washington State Fair. She described the group's long history at the WSU campus, its established fair partnerships for demonstrations and plant diagnostics, and weather and coverage problems at the current location.

Key Outcomes

• Approved the agenda, 7-0.
• Approved a motion to suspend the rules, 7-0, adding the Capital Improvement Plan agenda items to the October 14 meeting and allowing the October 15 study session to be skipped.
• Councilmember Door recused from LTAC, Councilmember Witting recused from community grants, and Mayor Kastama said he would abstain from the LTAC Master Gardeners vote.
• The mayor withdrew the $250,000 America 250 placeholder, to be refined for a later budget amendment.
• No final approvals of budget adjustments, LTAC awards, community grants, or CIP changes were made; first readings are expected at the next council meeting. Staff were asked to provide legal review of the YMCA grant, ESCO/state partnership background, and traffic-safety data.