Incorporation expert provides encouragement to Birch Bay efforts

A former city manager who has extensive experience with incorporation and leading new cities in Washington has given his stamp of approval for Birch Bay incorporation efforts.

Robert “Bob” Jean told the Birch Bay Incorporation Association’s steering committee and the nearly 20 people attending the May 15 meeting that he believed Birch Bay was in a favorable position to become its own city.

“This case is really feasible as a stand-alone new city, and you can do it without increasing taxes,” Jean said. “You just have to redistribute the taxes that exist, and you can actually do it for less.”

Jean stated the association’s budget forecast was the most developed he’d seen an incorporation group formulate by itself. He believed the association’s preliminary numbers would be more conservative than those from the consultant that Whatcom County hired to research the feasibility of incorporation.

Jean, now retired, was the first city manager of Newcastle in King County and University Place outside of Tacoma, and served as manager of five additional cities in his 35-year career. He was involved in the city incorporations of Edgewood in 1993, Lakewood in 1994, Shoreline in 1994, Liberty Lake in 2001 and Spokane Valley in 2003. He has also served as president of the Washington City/County Management Association.

In March, Whatcom County Council approved a $150,000 contract with Community Attributes Inc. to update a 2008 feasibility study on incorporating the Birch Bay urban growth area. This was the second time the county had approved a contract for the updated feasibility study, as the funding had lapsed for the study that council approved last summer and needed to be reapproved.

The feasibility study will provide data on city operating costs and tax revenues that the association will use to determine if it wants to move forward with attempting to incorporate. Sales tax from online purchases and property tax revenues from vacation rentals have likely only improved conditions for incorporation since 2008, Jean said. He told Birch Bay residents that the community was a net revenue generating area and incorporating could bring more services, such as faster law enforcement response.

“You generate more money than the county provides service and in that gap, all you need to do is take that existing structure and reallocate it to what the county’s keeping,” Jean said.

If the association decides to try to incorporate after the feasibility study, BBIA founder Matt Berry said the group could potentially put incorporation on ballots in November 2026. A city council could be formed by that next spring and then the city would have an interim period where it’s not legally a city but has some legal authority, Jean said. That transitional time would last about four months as the government adopts ordinances to have in place the day it becomes an official city.

During that transitional time, the forming government would need to receive a bank loan to pay for upfront costs. The county would then reallocate the money it had reserved for the remainder of that year for Birch Bay, which the new city would use to repay its loan. The city would use the revenue it generates, such as property and sales taxes, to pay for its first full year.

If all goes as planned, Jean said Birch Bay could resolve its growing pains within five years of becoming a city. Cities around Whatcom County and the county itself are trying to balance budgets facing shortfalls. When asked whether Birch Bay too would struggle to keep its budget balanced, Jean said more established local governments often have budget problems that are rooted in old policies or not finding opportunity in their budgets.

“Your sales tax revenues are stronger than the average new city that I have seen,” Jean said. “Your property tax revenues are stronger.”