City Council

TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 1 CONVENE: 7:00 p.m. PRESENT: Mayor Debbie Sullivan and Councilmembers Peter Agabi, Michael Althauser, Joan Cathey, Leatta Dahlhoff, Angela Jefferson, Eileen Swarthout, and Kelly Von Holtz. Staff: City Administrator Lisa Parks, City Attorney Karen Kirkpatrick, Assistant City Administrator Kelly Adams, Finance Department Director Troy Niemeyer, Police Chief Jay Mason, Fire Chief Brian Hurley, Water Resources and Sustainability Department Director Dan Smith, Community Development Department Director Brad Medrud, and Deputy City Clerk Tracie Core. SPECIAL ITEMS: PROCLAMATION: Councilmember Jefferson read a proclamation declaring June 19, 2025 as JUNETEENTH, JUNE Juneteenth in the City of Tumwater. The proclamation calls on the people of 19, 2025: Tumwater to join together on Juneteenth, to reflect on the past, to commit together to continue to eradicate systemic racism, to look to the future, and to work each day to lift each other up for collective prosperity and liberty. Mayor Sullivan presented the proclamation to Dr. Thelma Jackson, who accepted the proclamation on behalf of Lester Dickson, Fred U. Harris Lodge. READING OF Mayor Sullivan described the origination and purpose of the resolution drafted RESOLUTION R2024- by the Public Health and Safety Committee and the Council. The Council 015, TUMWATER adopted the resolution on December 3, 2024 to convey its support of people RESOLUTION in the community and around the nation. The resolution affirms the Council’s AGAINST HATE: commitment to equality, dignity and the protection of civil rights, and standing against hate, bigotry, and discrimination. Councilmember Von Holtz read the resolution adopted by the Council. The resolution was in response to some troubling incidents shared with the Council by community members of color. The incidents were experiences of hate, discrimination, and intolerance. It was also influenced by the voices of the Thurston County National Association for the Advancement of Colored People (NAACP) and the invaluable work of Councilmember Jefferson and the Public Health and Safety Committee. Although the Council adopted the resolution, the resolution was not read because it was included as an item for consideration on the Council’s Consent Calendar. Dr. Thelma Jackson thanked the Council for notifying the Thurston County NAACP that the resolution was included on the Council’s agenda. When the resolution was originally considered, members were somewhat baffled because the NAACP had sent letters to the three largest cities and Thurston County requesting a proclamation or declaration. As the meetings are TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 2 televised for the public, members followed up with a request to receive a copy of the resolution because it had not been read into the record during the adoption of the resolution. It is important for citizens to know the contents of the resolution because it is a powerful resolution with deep meaning and addresses layers of much more than proclamations issued by the other jurisdictions. Six months later, living in today’s climate, there has been a huge effort to turn back diversity, equity, inclusion, belonging, and anything of any shape, form, or fashion. Washington State is a target as it is a DEIB state. Citizens need to know that the City Council made a commitment and agreed to a series of actions. One is the development of the City’s Equity Commission. On behalf of the NAACP, she applauds the Council’s follow- up action as people are wondering where their leaders stand on these important issues. PUBLIC COMMENT: Cortni Marie Holthaus, 6605 Ly Rhon Court SW, Olympia, reported she is in litigation against Tumwater businesses. She is a federal plaintiff litigating against Providence St. Peter’s Hospital, Multicare Lacey Emergency, Department of Corrections (former employer), and the Tumwater Police Department. On February 25, 2025, she stood outside Tumwater City Hall with her car covered in simple protest messages against her former employer, the Department of Corrections. Seconds later, a police vehicle starting following her, which was denied (by the Police Department). No one cares, but she has the evidence. Her devices around the same period were hacked and sabotaged and it appears it is continuing. She also has the evidence. She went to the hospital in March for help and was given a bipolar 1 with paranoia diagnosis after she explained her situation. No evaluation occurred and information was simply passed between St. Peter’s Hospital and Multicare Emergency Room as if her consent and rights did not matter. Providence St. Peter’s Hospital has been funded by Washington State Patrol, IBM, KPMG, and others. It is not healthcare; it is a corrupt system hiding behind white coats. She saw the writing on the wall literally, as the names were on donor plaques at Providence St. Peter’s Hospital. Before her unemployment hearing on March 17, 2025, Assistant Attorney General Peter Kay of the Attorney General’s Office mocked her mental health challenges in writing and said that her legal complaint would be confusing due to her mental health challenges. That is not just bullying, that is discrimination as she is a sexual assault survivor. She applied for crime victim assistance and was denied, as there was no crime, as if hacking, medical fraud, medical malpractice, and blatant discrimination counted since she is the victim. She asked when she will receive crime victim assistance. She is still waiting for the audio and video of February 25, 2025 that was claimed to be exempt because a random crime nearby during same timeframe. That is not a good excuse. Ryan Reynolds, President, Tumwater Chamber of Commerce, 9020 Blomberg Street SW, Tumwater, invited the Council to participate in the Thursday, June 19, 2025 Chamber Golf Tournament. A table has been TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 3 reserved for the Council with the Tumwater School District. He stressed the importance of the relationship between the school district, the Chamber, and the City serving as the foundation of the community. CONSENT a. Approval of Minutes: City Council, June 3, 2025 CALENDAR: b. Payment of Vouchers c. Interlocal Agreement with Cities of Lacey, Olympia and Yelm for the update of the Accessory Dwelling Unit Plans d. Service Provider Agreement with the Artisans Group for the update of the Accessory Dwelling Unit Plans e. Supplemental Agreement No. 2 with Tierra ROW for X Street Roundabout Project f. Agreement with Thurston County for Specialized Recreation g. Reappointment of David Bills, Brian Reynolds and Satpal Sohal to the Lodging Tax Advisory Committee h. Association of Washington Cities 2025 Annual Business Meeting Voting Delegates MOTION: Councilmember Dahlhoff, moved, seconded by Councilmember Von Holtz, to approve the Consent Calendar as published. A voice vote approved the motion unanimously. Mayor Sullivan reviewed the items approved on the Consent Calendar. COUNCIL CONSIDERATIONS: QUARTERLY Director Niemeyer provided an update on first quarter 2025 financials for the FINANCIAL City of Tumwater. UPDATE: Director Niemeyer reviewed the status of the national economy, looming risks, and data specific to Tumwater. Late in 2024 and through January 2025 economic forecasts were positive. The Federal Reserve raised short-term interest rates in 2024with the intent of cooling off the economy to bring inflation down. Subsequently, recession was avoided and inflation was beginning to decline. Unemployment continued to be low and the Federal Reserve began to cut rates after raising the rates. Continued strong economic growth was predicted and Wall Street was excited about the new Administration. Since April 2, 2025 when tariffs were announced, the stock market experienced steep declines because of financial uncertainty across all financial markets and the lack of a clear economic plan. In April and May, the economy experienced continued change with tariffs constantly changing up and down and uncertainty surrounding the markets as well as consumer spending. Tariffs and deportations are highly inflationary policies and high inflation over TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 4 the last several years leads to higher interest rates that can discourage large purchases, such as homes and automobiles. In April 2025, USA Today Newspaper published how the economy was projected to grow by 1.7% but actual was only 0.8%. The economy was expected to grow by 2.5% in January 2025. A survey of economists now predicts approximately a 50% chance of recession. In February 2025, the prediction of a recession was only 25%. Several economists surveyed indicated that tariffs are the cause of the current economy. Clear policies are important as the economy, consumers, and the markets want certainty to make informed decisions. Opening, expanding existing business, or closing a business all depend on some level of certainty. Today, the economy is experiencing a period of continued uncertainty with tariffs continuing to change. Although tariffs on China have been paused for 90 days, it speaks to the need for more efforts. Supply change shortages are eminent with ports less busy because tariffs are bringing in fewer products, which will affect the economy. The uncertainty is how negatively it will affect the economy, the duration, and cost increases. Some companies are not using “tariff” to avoid upsetting the Administration and have opted to refer to the “operating environment.” However, tariffs are a tax that will cost people more money. Significant risks are anticipated with the passage of the President’s budget bill. Massive cuts to Medicaid will hurt those who can least afford it and the national debt is projected to increase by $3.5 trillion. Moody’s Investment Services downgraded the U.S. credit rating, the first time in the nation’s history. As a result, foreign investors will find U.S. debt less attractive and riskier, which leads to higher rates. As borrowing rates increase, debt secured by the City will increase in cost. National polling reflects consumer confidence is down by 30%. The first quarter GDP was negative by 0.3% (first time in 3 years that the nation had a negative GDP). A second quarter negative GDP will reflect a national recession. Tumwater’s April sales tax was the lowest monthly collection in the last three years. Unemployment has increased but continues to be steady. The national debate speaks to stagflation, high inflation and a shrinking economy, which has not occurred since the late 1970s. Director Niemeyer shared some graphs produced by the University of Michigan on consumer confidence and consumer sentiment. The graph reflects monthly data for consumer confidence and sentiment. Early on in 2025, consumer confidence dropped quickly. The graph includes a 10-year look-back reflecting a dip between 2022 and 2023. However, the nation avoided a recession and the nation course corrected. Consumer confidence has been tracked since 1960. The graph reflects when recessions occurred. TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 5 Consumer confidence typically dips during a recession. Another graph reflected consumer confidence related to job prospects. Current consumer surveys expect higher unemployment moving forward. Director Niemeyer reviewed Tumwater’s first quarter financial data. The City started the year with a small decrease of less than 2% in sales tax collections but in February and March, sales tax collections increased by 4% and 6%, respectively with April sales tax collections dipping under $700,000. Optimistically, year-to-date is estimated to be 2.77% more than 2024 collections. May sales tax collections totaled $782,000 or nearly $100,000 more than April; however, compared to May 2024, sales tax collections were less by $63,000 or a 7.5% decrease. Total year-to date sales tax collections are down by nearly 4.9%. Based on the total budget for 2025, the year-to-date budget forecasts 41.6% through the end of May. Total year-to-date sales tax collections are at 35.86% or 5.8% less than budgeted goal of 41.6% through the end of May. The public safety sales tax (Proposition 1) is a restricted source of funds for public safety purposes. The sales tax is a new source of funds. The new tax was effective in 2024 with no long-term comparative data available. Business and Occupation (B&O) tax reflect a 6% increase in January, 5.7% increase in February, a 10%+ increase in March, a 5.5% increase in April, and a decrease of approximately 20% in May. However, year-to-date B&O tax collections reflect a positive of 7.5%. Property tax collections occur in April and November and are steady and reliable. Director Niemeyer reviewed year-to-date actuals for utility tax, building permits, grants, and state-shared revenue sources. In total, year-to-date collections represent approximately 44% of general fund revenue of the budget forecast year-to-date of 41%. Director Niemeyer reviewed expenditures reflecting year-to-date actual of 36.71% versus the budget of 41.6% or 5% less than budgeted. Within the Utility Funds, large capital projects are budgeted for the current biennium reflecting millions of dollars in projects to include the new Operations and Maintenance Facility and a water storage tank. The Golf Course fund represents lower collections in revenue partially because of a different computer system that creates a lag with actuals only reflecting figures through the end of April rather than May. TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 6 TEN-YEAR Morgan Shook, Director & Partner, ECONorthwest, updated the Council on FINANCIAL PLAN the status of the Ten-Year Financial Plan. The firm is an economics finance UPDATE: company offering specialization to local governments on a range of financial planning projects. The firm is constructing an analytical financial model that provides scenario analysis, evaluates current funding, spending priorities, explores future funding needs and spending scenarios, and tests potential strategies to align budget decisions with community goals. The model represents the City’s financial structure of personnel, non-labor investments, and capital outlays. The tool, which is updatable, will export information during the budget cycle. The information enables the evaluation of a set of scenarios that have long- standing impact on expenditures and delivery of services and revenues. The model is also tied to the City’s revenue sources to model any changes based on different scenarios, such as stronger property tax or a decrease in sales tax and their impact on the general fund. The model is capable of modeling policy changes pertaining to revenue sources, such as a levy lid lift to pay for specific services. The team is engaging different constituents and sources around fiscal opportunities and challenges to consider different scenarios for how the City envisions the delivery of services. The approach involves three inputs: (1) current commitments in the 2025/2026 budget, (2) engaging department leadership to consider a strategic plan for the delivery of services from a financial perspective, e.g. need for additional FTEs, need for non-labor spending, or important capital projects, and (3) alignment with the Council’s strategic planning process and input from the community. Mr. Shook described the framework for Council decision-making as core and required services (essential services required by law or necessary for basic community function), current community commitments (existing programs and services reflecting past community decisions and commitments), and enhanced service and infrastructure investments (proposed improvements or expansions in service quality, scope, or scale that would require new or increased revenues). Information from the framework is to develop different scenarios to ascertain the effect on sustainability. Councilmember Dahlhoff asked whether the Council would have access during the development of the budget to test different funding scenarios. City Administrator Parks said the current effort is creation of the model that provides the City with the ability and capacity to create different scenarios moving forward. The model will be used for preparation of the budget during the next biennium (27/28). The model is an Excel spreadsheet rather than TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 7 proprietary software and requires no specialized experience other than experience with Excel spreadsheets. The model will enable conversations around the impacts of different budgeting scenarios that allow users to view outcomes rather than just hearing about an outcome from staff. Mr. Shook reviewed several scenarios: • Scenario A: Status Quo − Maintain current service levels and revenue structures. − Evaluate sustainability and financial stability if current spending patterns continue. • Scenario B: Service Expansion with Revenue Adjustments − Identify areas where service expansion may be desirable (e.g. public safety, parks, or infrastructure). − Pair expansions explicitly with revenue options (e.g., property taxes, utility fees, or user charges). − Discuss trade-offs: affordability, community expectations, and impacts on fiscal stability. • Scenario C: Prioritizing Large Capital Investments − Focus resources on major capital projects and infrastructure improvements. − Evaluate funding strategies (bonds, grants, partnerships, etc.). − Explore long-term impacts: debt capacity, operational costs, and benefits of strategic investments. • Scenario D: Economic Stress Scenario − Evaluate the City’s financial resilience under economic downturn conditions (recession, decreased tax revenue). − Identify essential services and potential budget adjustments or emergency reserve needs to withstand downturn periods. Mr. Shook invited feedback on the proposed modeling tool. City Administrator Parks advised that at the Council’s June 28, 2025 strategic planning meeting, Mr. Shook will be attending. The session discussion will consider current commitments and enhanced services in different categories to assist the Council in prioritizing strategies to develop baseline financial scenarios to identify different outcomes based on the addition or deletion of different Council priorities Throughout the summer, Mr. Shook will attend work sessions and Council meetings to assist in refining the preliminary priorities for development of the Strategic Plan at the end of the 2025 that will inform the development of a set of work plans based on the priorities the Council identified. Financial outcomes will be modeled to support the budgeting process in 2027. COMMITTEE REPORTS: TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 8 PUBLIC HEALTH & The meeting on June 10, 2025 included an update on police performance data, SAFETY: specifically information on operations and administrative functions. Peter Agabi GENERAL At the June 11, 2025 meeting, members received presentations on the GOVERNMENT: following topics: Michael Althauser • 2025 Comprehensive Plan Periodic Update – Conservation Element • ADU Interlocal Agreement and Unit Service Provider Agreement • Thurston County Specialized Recreation Agreement PUBLIC WORKS: The next meeting has been cancelled due to the Juneteenth holiday. The next Eileen Swarthout meeting is scheduled on July 10, 2025. BUDGET AND The meeting on June 13, 2025 included interviews of grant applicants for the FINANCE: Community Human Services Funding Program. Debbie Sullivan MAYOR/CITY City Administrator Parks reported the Public Health and Safety Committee ADMINISTRATOR'S discussed a new business liaison pilot project by the Police Department’s REPORT: Detectives Division to help improve relationships between the business community and the Tumwater Police Department. The program utilized a list of business licenses issued in the City with detectives visiting each location to provide contact information for the Police Department. Each detective provided the business with an informational flyer and reviewed the business premise to offer advice on improving the security of the business as well as receiving updated information for TCOMM 911. To date, contact has occurred with 30 businesses. Feedback has been positive. She acknowledged the efforts of Police Lieutenant Jen Kolb and Police Sergeant Chuck Liska, who were instrumental in developing the program. Forty-eight teams participated in the third annual Rally in the Valley Volley Ball Tournament on Saturday, June 14, 2025 at Pioneer Park. The Dog Days event attracted 31 vendors and over 1,000 participants with 80 vaccines offered by the Deschutes Animal Clinic. The Parks and Recreation Department is sponsoring a new Craft Concert Series. Four concerts are planned throughout the summer in the area slated as a future amphitheater at the Craft District. The first event scheduled on June 26, 2025 features "Rockin' Summer" with Nikko & the Night Shift from 6 p.m. to 7:30 p.m. June 20, 2025 is the last day to participate in the Community Engagement Survey. City Administrator Parks encouraged the community to participate in the survey. TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 9 Mayor Sullivan attended the Thurston Chamber of Commerce meeting on July 11, 2005. The event featured the graduation of Leadership Thurston County graduates with three of the graduates from the City of Tumwater. City graduates included Fire Battalion Chief James Osberg, Assistant City Administrator Kelly Adams, and Sustainability Manager Alyssa Jones Wood. Mayor Sullivan is scheduled to attend the Association of Washington Cities (AWC) conference in Kennewick next week. COUNCILMEMBER REPORTS: Joan Cathey: Councilmember Cathey attended the Solid Waste Advisory Committee meeting. Members reviewed a summer recycling event and community response to recycling. At the last Olympic Region Clean Air Agency meeting, members reviewed how communities will handle the presence of smoke from wildfires and potential ways to mitigate the impacts from smoke in the air. Michael Althauser: There were no meetings and no report. Peter Agabi: At the June 9, 2025 Joint Animal Services Commission, members reviewed statistics and the volunteer program at the animal shelter facility, local spay and neuter services, and a budget amendment. The facility reflects many volunteers contributing hours of support. However, any lack in the number of volunteers will create the necessity of hiring either half-time or full-time staff. Low cost spay and neuter services according to the data reflects that Thurston County residents must travel to Tacoma or Snohomish Counties to receive low cost spay and neuter services. On June 10, 2025 Councilmember Agabi attended the Thurston Regional Planning Council (TRPC) meeting in conjunction with Councilmember Swarthout, who services as the City’s TRPC representative. The discussion focused on the Regional Transportation Plan. At the June 11, 2025 Transportation Policy Board meeting, the discussion on the RTP expanded to a specific project involving the Log Cabin Road Extension project in Olympia. TRPC has indicated no support for the project moving forward. TPB members were prevented from voting on a recommendation to remove the Log Cabin Road project. During the discussion on the project, members were informed that they should meet with their respective City Councils for feedback on the project rather than TPB members forwarding a combined recommendation to the TRPC. Councilmember Agabi reported he recently met with Mayor Sullivan regarding the project to receive feedback. Mayor Sullivan advised that the decision to either remove or retain the project is a decision rendered by members of the TRPC. TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 10 City Administrator Parks advised of efforts with staff to develop a standardized response to the TPB and TRPC when those types of circumstances occur. Councilmember Agabi commented on potential traffic impacts created in the City caused by the Log Cabin project. According to TPB staff, some traffic will be added to Tumwater Boulevard and Henderson Boulevard, which in essence is a Tumwater issue. City Administrator Parks advised that Councilmember Swarthout forwarded an email to Director Hicks about the issue. Director Hicks responded to the email, which she will forward to Councilmember Agabi. In response to questions as to how the City would respond to issues arising in other intergovernmental committees that might affect the City, City Administrator Parks advised that the Council Rules includes a section addressing the roles of Councilmembers serving as representatives of the City on regional boards and committees. For routine matters, Councilmembers are authorized to render recommendations. However, for matters that need a Council review, it is important for the Councilmember to communicate that information to the regional board/committee. She recommended contacting staff to provide the necessary support for inclusion on a Council agenda for a discussion and/or direction by the Council to the Councilmember representing the City on the board or committee. Eileen Swarthout: An agenda-setting meeting was held earlier in the day to discuss the TRPC meeting in July. The issue (Log Cabin project) is included on the agenda for members to address the action the Council rendered. There may have been information that was missing that should be provided to the Council about the affects of removing the project and the impact on the entire RTP. More information will be provided to TRPC by staff at the July meeting. Councilmember Swarthout reported on her meeting with the City’s new Urban Forester. Leatta Dahlhoff: TCOMM 911 members discussed the necessity of upgrading radios that were previously implemented during the switch from analog radio to digital radio systems. The Thurston County Opioid Abatement Council meeting included approval of access to Director Niemeyer for funding accounts. Members offered their respective insights on different types of projects to fund and overlapping with the tribes. Social media campaigns on billboards and radio/TV advertising on prevention of substance use and overdose are planned by the Thurston County TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 11 Opioid Response Task Force, as well as on medication lock boxes and storage of medicine safely. The LOTT Clean Water Alliance Board reviewed some policy updates. Councilmember Dahlhoff officiated the opening of the Olympic Air Show. Councilmember Dahlhoff reported she and Manager Wettstein attended the Thurston Forward Summit meeting. Mayor Sullivan is considering either staff or funding support for the event. Councilmember Dahlhoff is scheduled to attend the AWC conference next week as well. Angela Jefferson: At the last Tumwater HOPES meeting, members discussed the partnership with ESD 113 and the Washington State Department Health to sponsor an awareness class on Drug Availability via Social Media. Information will be shared on what families should know and do because many teens and young adults are obtaining substances on social media platforms through symbols unknown to parents and guardians. The training will help educators, parents, and guardians uncover how social media platforms are increasingly being used to promote and distribute dangerous substances to youth. The classes will be held on June 25, 2025 from 9 a.m. to 10 a.m. and June 26, 2025 from noon to 1 p.m. Flyers are available to advertise the classes. The Tumwater HOPES community survey is planned to be released in mid- July by paper, online, and during community events. Boardmembers of Experience Olympia and Beyond Visitor Convention Bureau plan to welcome the new CEO, Michael Day, on July 8, 2025. Mr. Day is from Edmonds, Washington. The July 8, 2025 meeting from 3:30 p.m. to 4:30 p.m. will be followed by a community meet and greet for Mr. Day from 4:30 p.m. to 6 p.m. at Anthony’s near the Olympia Farmer’s Market. Members discussed communications from Olympia and Beyond as the organization’s partners are local city leaders and managers. She recommended exploring more presentations to local governments to provide status updates on the organization. Members also discussed the name of the organization as the bureau represents all of Thurston County. Kelly Von Holtz: Meetings attended included the Tumwater Public Health & Safety Committee. Future meetings include Intercity Transit on Wednesday, June 18, 2025. Members will tour the new maintenance facility. At the Law Enforcement Assisted Diversion meeting, members discussed how budget cuts are affecting the HCA Navigators Program and LEAD Thurston TUMWATER CITY COUNCIL MEETING MINUTES OF HYBRID MEETING June 17, 2025 Page 12 County, which will continue at its current level during the remainder of the year. On Saturday, June 14, 2025, Councilmember Von Holtz and Councilmember Dahlhoff attended a signing event with Governor Ferguson at Western Plaza celebrating House Bill 1217 capping tenant rent increases by 5%. Councilmember Von Holtz spoke in support of the City’s Leadership Thurston County graduates. ADJOURNMENT: With there being no further business, Mayor Sullivan adjourned the meeting at 8:51 p.m. Prepared by Valerie L. Gow, Recording Secretary/President Puget Sound Meeting Services, psmsoly@earthlink.net