Blaine City Council adopted a $44.3 million budget for 2026 on November 10, balancing ambitious utility infrastructure investments against modest growth in general operations while drawing down reserves in several key funds.
The budget, approved as Ordinance 25-3039, allocates $42.2 million in revenues across all city funds, with the $2.1 million gap covered by tapping into existing fund balances. Utility operations dominate city spending, accounting for nearly 60 percent of total expenditures.
The electric fund’s planned $2.6 million drawdown stands out, reducing reserves from $3.2 million to just $637,000 – an 82 percent depletion that could signal future rate adjustments or major capital projects.
City manager Mike Harmon explained that the Bonneville Power Administration (BPA) has “experienced tremendous rate pressure on their purchase power,” adding, “If they’re not producing enough power through the dams, they buy power at whatever the market rate is at the time. So, if it’s a cold day and everybody’s buying power, that price is high.” Those costs are passed onto their customers.
In addition, BPA has to secure power for Blaine based on what the city’s predicted growth is in coming years. In 2023, it was anticipated that the Grandis Pond development would add significantly to the electrical demand, so BPA priced accordingly. Harmon added that Blaine’s electrical rates remained significantly lower than that charged by Puget Sound Energy.
The general fund budget of $10 million maintains core city operations with what city officials hope will be a balanced approach. Property taxes bring in $1.24 million (up 1.6 percent from 2025), while retail sales taxes contribute $2.69 million (up 5.4 percent). Utility tax revenue jumped 20.5 percent to nearly $1.5 million, one of the most significant revenue increases.
Council approved the allowable one percent increase in its share of the property tax, which will add $15,620 in revenue for 2026.
Transportation receives substantial attention with $4.2 million allocated for capital improvements, while the city’s transportation benefit district continues building reserves, growing from $1.25 million to $1.47 million.
However, some funds tell a different story. Impact fees collected from developers sit largely unused. Traffic impact reserves will grow to $1.16 million and park impact reserves to $455,000, both with zero planned expenditures in 2026. Real estate excise tax funds hold over $2.1 million with minimal capital spending planned.
The hotel/motel fund faces pressure, with $364,861 of planned spending on tourism-related programs against revenues of just $262,000, completely depleting the fund’s reserves.
Police department staffing shows approximately 14 sworn positions, including a chief, deputy chief, two sergeants and 10 officers, with salaries ranging between $85,000 and $178,000. The budget includes $75,000 for replacing a 2014 patrol vehicle.
Wastewater planning gets significant attention with $400,000 allocated for a comprehensive plan study and $20,000 for a rate study, suggesting the city is preparing for major system
decisions.
Despite the targeted drawdowns, Blaine maintains healthy overall reserves. The total ending fund balance of $25.4 million and the general fund’s $4.4 million cushion representing 44 percent of annual operations provide financial stability.
Finance director Jennifer Spidle and Harmon presented the budget through multiple council study sessions and public hearings in October before the November adoption.
The ordinance takes effect five days after passage, with certified copies forwarded to the Washington State Auditor’s Office and other oversight agencies as required by state law.
