City finance staff presented a mid‑biennium budget update to Spokane City Council, reporting downward adjustments to several revenue lines and describing a mix of cuts and new revenue proposals aimed at balancing the biennial budget.

Finance staff said sales-tax collections have trended below projection and the city is revising its outlook downward, including a $1.5 million reduction in sales-tax projections and “over a million dollars” reduction in property-tax projections. Utility tax revenue reductions were quantified as roughly $2.75 million across affected funds. Staff noted some stabilization may come from recent state sales‑tax enforcement (state bill referenced as SB 5814) and potential future interest-rate changes that could spur construction activity.

On the expenditure side, the administration proposed workforce and service reorganization that would reduce net positions: roughly 17.3 net positions reduced in the current biennium and about an additional 20 net positions proposed for 2026. Staff said some of the reductions come from centralizing services and restructuring capital funding (including debt financing for some police capital purchases to better match asset lifecycles). The administration also emphasized it has added uniform personnel positions in this cycle for public‑safety priorities.

As a proposed revenue measure, the administration introduced an ordinance to adopt a local option transportation tax on commercial parking. Staff described ongoing stakeholder engagement and said the tax is intended to fund transportation initiatives and ensure downtown and commercial corridors contribute to related costs. Several council members said outreach has not been sufficient and asked for more detail on implementation, separation of duties, and the parking tax’s treatment in the budget; one councilor described the proposal as “too fast” and said more stakeholder work is needed.

Council scheduled more time for focused review: a focus group meeting Thursday and a budget study session (date discussed) to examine reorganization details, staffing impacts and fund transfers. Finance staff said final budget materials and itemized detail will be provided to council before formal votes.