(The Center Square) – Facing a $13 million deficit, the Spokane City Council is considering temporarily raising the utility tax rate by .5% to ensure cost recovery despite walking back that promise last year.
The last time the council raised the utility tax rate was in 2023, after former Mayor Nadine Woodward proposed a temporary 1% increase to address another shortfall. That approval raised the rate to 21%, which still stands today after Mayor Lisa Brown proposed cutting the sunset clause altogether last fall.
Brown closed a $25 million deficit last winter by cutting the sunset on the 1% utility tax, taking some cuts and implementing a voter-approved sales tax. The sales tax also includes a sunset, which Brown assured residents could trust, despite cutting the one tied to utility taxes just weeks after the election.
“We’ve prepared five ordinances. The first would increase the utility tax by .5% for one year for water, sewer and garbage,” Public Works Director Marlene Feist told the officials during a committee meeting on Monday. “Subsequently, we’re also proposing increasing the water, sewer and garbage rates.”
Unlike last year, the council requested this increase to the city’s utility tax and general service rates.
If approved, the “temporary” .5% utility tax hike would generate $1.3 million to plug some of the $13 million deficit Brown currently faces. She also proposed a 12% parking tax to fill the budget, which the council will vote on Monday night amid significant opposition from the downtown business community.
Last year, the council decided to raise utility rates by more than 10% across 2025 and 2025 after only increasing the monthly charges by about 2.9% annually for the past decade. Residents faced a 4.88% hike this year and will see another 5.47% increase in 2026, not including what Feist proposed Monday.
The roughly 10% increase across 2025 and 2026 amounts to another $180 on residential utility bills.
Feist said the .5% increase in utility taxes and general rates will only cost residents another 75 cents per month. Senior citizens qualify for a $20 per month discount. While only 1,850 customers qualified for it last November, Feist said 3,132 people now take advantage of those discounts, a 69% increase.
“I just want to shout out Marlene, for her and her department, who were able to pivot at the last minute,” Council President Betsy Wilkerson said Monday. “Thank you for accommodating council and their creative ideas of how to kind of help this budget get across the finish line.”
