Page last updated on:
The City’s budget is more than a financial document. It reflects our community’s priorities by specifying how we are investing resources to achieve our goals.
On this page you can explore the details of the current budget, learn about the basics of the City’s budget, or find out more about policies that govern the City’s revenue and spending.
Current budget
The City budgets on a one-year cycle. This process is governed by state law, policies approved by the City Council, and our municipal code.
- The City budget process begins in the spring as departments develop budget requests for consideration by the Department Head Team and the Mayor over the summer.
- The Mayor delivers the Proposed Budget to City Council in late September.
- The City Council spends the months of October and November discussing and amending the budget for final adoption in December.
Find more detailed information in the 2025 adopted budget and in the links below.
Participate in 2026 budget development
This fall, the City Council is deliberating and making decisions about the City’s 2026 budget. You can review the Mayor’s proposed budget and give feedback during this time.
- Read Mayor Lund’s memo about the 2026 proposed budget or our budget overview.
- Review the full 2026 proposed budget.
- Watch recordings or join meetings live – in person or virtually – to hear budget presentations and discussions.
- Email City Council to share your feedback about the budget, or give public comment during an upcoming meeting, work session, or public hearing.
Financial policies
Our financial management policies explain how we manage our financial resources to meet our current operating and capital costs and also plan for the City’s future needs. We are responsible stewards of public funds, maintaining strong financial health to ensure we can deliver essential services, meet our commitments, and remain resilient during economic downturns or unexpected emergencies.
Spending priorities
The City allocates resources based on our defined priorities, in this order:
- Ensure public safety and meet legal obligations – Public safety is a foundational part of local government, and work that only the City can do on behalf of our community.
- Provide general governance, maintain existing infrastructure, and operate City-owned or operated amenities and programs – We maintain and operate existing facilities, amenities and programs with excellence.
- Replace existing assets or equipment – As needed, we upgrade or replace the technology, amenities, facilities, and equipment needed to do City business.
- Invest in new amenities, equipment or programs – We take on new work or expand service in alignment with our policy goals and when financially feasible.
Making decisions when revenues change
We’re required to keep a balanced budget, so our ability to provide services varies with shifts in the economy that affect how much money we take in through taxes or fees.
During times of declining revenue, we may lower service levels, narrow our scope of programming, or reduce capital investments – based on the priorities outlined above.
When revenues rise, we focus first on maintaining existing City service levels before meeting any unfunded commitments, adding new programs, or making new investments in programs or amenities.
Sources of revenue and spending
General Fund vs. dedicated funds
The City’s budget is split into over 50 funds, all except the General Fund are legally tied to a specific purpose. Each of these dedicated funds has its own funding source and strict spending rules, so one fund cannot borrow from another. Some more familiar examples of dedicated funds are:
- Utilities funds: Paid for by utility taxes and used to support drinking water, sewer, and stormwater infrastructure, services, and programs.
- The Parking Services Fund: Uses parking meter payments and fines to support parking infrastructure and a vibrant downtown area.
- The Greenways & Affordable Housing Funds: Voter-approved levies for parks and housing.
Unlike dedicated funds, the General Fund has flexibility to support any City department or program. Most of the General Fund goes toward staffing.
The General Fund is also our most significant source of public safety funding. In fact, 60% of the General Fund is spent on staffing, training, and equipment for police, fire, and emergency medical services.
Property tax
For every $1 you pay in property taxes, 19 cents goes to the City of Bellingham. Of that:
- About 10 cents goes to the City’s General Fund.
- Just over 5 cents goes to the Greenways Levy and a little over 2 cents goes to the Affordable Housing Fund.
- The remainder, about 1.5 cents, goes to a pension fund for public safety employees.
Watch this City Council presentation from October 2024 for a deep dive into how property tax works and how we spend our portion of revenues.
Sales tax
Most sales tax revenue — 72 cents of every dollar you pay — goes to Washington State. The City of Bellingham receives about 13 cents directly, including a small portion for transportation and housing, specifically.
The City also benefits from a small portion of county-wide sales tax revenue that goes toward specific programs or uses, such as behavioral health programs and public health and safety.
Other sources
Other sources of City funding are a Business and Occupation Tax (B&O tax) and utility business taxes. A much smaller portion of the City’s budget comes from fees, fines, grants and investments.
The B&O tax rate is 0.44% for services and 0.17% for wholesaling, retailing, manufacturing, and extracting activities. It is collected on gross receipts.
The City also receives a utility tax from utility businesses, which is similar to the gross receipts B&O tax.
