Update for Oct. 28
No state sales tax credit almost certainly means no annexation of White Center and the remaining unincorporated North Highline.

“The council has been fairly clear that it won’t go forward with annexation without the sales tax credit,” City Manager Mike Martin said Friday morning.

Eliminating the state sales tax credit to cities that annex unincorporated areas was among the proposals offered by Gov. Chris Gregoire on Thursday as a way to deal with the latest state budget shortfall.

Martin said city officials are still looking at what the proposal may mean. That would include the credit already being received by Burien for annexing the Boulevard Park area.

“We’ll have to wait until the dust settles,” Martin added.

Meanwhile, council candidate Greg Duff issued a statement saying he would not support annexation without the credit.

“You can rest assured that King County, Snohomish County, and officials from all 7 cities affected will be having meetings with the governor,” Duff wrote.

“The Burien City Council has said from the start that there will be a lot of negotiations before a deal is finally struck and this is just one more item that we will have to work out.

“Once again let me say very clearly that I will not support annexation if it is not financially viable for the City of Burien.”

Original post on Oct. 27
Two Burien council members on opposite sides of the annexation issue reacted differently Thursday to the news that Gov. Chris Gregoire has proposed eliminating the state sales tax credit to cities that annex unincorporated areas..

Councilman Gerald Robison said the governor’s proposal is the type of preliminary long laundry list that comes up whenever government looks at cutting budgets.

“I’m not worried about it at this point,” Robison said. “If it is written into the governor’s budget then we need to start worrying about it.”

But Councilwoman Lucy Krakowiak, the chief annexation opponent on the council, said the governor’s announcement means Burien needs to reassess the whole annexation situation.

“We shouldn’t do it,” Krakowiak declared.

The proposal is in Gregoire’s budget reduction alternatives sent to legislators Thursday morning. The state Legislature is set to hold a special session in about a month to address a $2 billion shortfall.
Gregoire said eliminating the state sales tax credit for cities that agree to annex unincorporated areas such as North Highline would save the state $17.8 million. The tax credit currently goes to seven cities in the Puget Sound area.

Burien lawmakers approved a resolution Oct. 3 declaring the city’s intent to annex White Center and the remaining unincorporated North Highline area.

If Burien annexed the area, the city was expecting to receive up to $5 million per year for 10 years.

The credit allows cities with over 10,000 population to keep .2 percent of the state sales tax produced in the city. The credit would help fund city services in the newly annexed area. Capital costs are not eligible, except for maintenance.

Robison said he would really be surprised if elimination of the sales tax credit is part of the governor’s final budget proposal.

He expects the affected cities would be successful in lobbying to eliminate the proposal.

“The amount of mony is minimal to the state budget but crucial for the cities,” Robison said.

But Robison admitted that “if the Legislature is fool enough to eliminate it, we would have to re-evaluate (annexation.”)
He added that if the Legislature scales the credit back to five years instead ten years, Burien may still be able to go ahead with annexation.

Krakowiak said the credit is the “$5 million golden egg.”
Without it, “no way” could Burien afford annexation, according to Krakowiak.

“I didn’t feel annexation was prudent with the $5 million,” Krakowiak added.