Lynnwood homeowners will face higher property taxes beginning in 2027 after the City Council unanimously approved an increase Monday during deliberations on the 2027-28 budget. The decision is expected to generate an additional $2.2 million each year, with final budget approval scheduled for Nov. 23.
The council agreed to use all of the city’s remaining banked capacity. State law permits cities to increase property taxes by 1% annually and save unused increases for later. Interim Finance Director Monisha Harrell said a Lynnwood household with a home worth $670,000 is expected to pay another $128 a year under the approved increase.
Mayor George Hurst included the additional property tax revenue in the budget proposal he presented in September. Harrell had previously warned that rejecting the increase would likely require layoffs, since staffing accounts for about 70% of city expenditures. Last year, council members used only some of the available banked capacity, approving a 24% property tax increase instead of a possible 53%. Hurst, then a council member, proposed that compromise.
The city’s financial difficulties have continued through several rounds of budget adjustments. In 2025, former Mayor Christine Frizzell reported a deficit exceeding $20 million as sales tax, development and red-light camera revenues fell below expectations. Following layoffs, service cuts and tax increases, Hurst said in March that the gap had been closed. In July, however, the city reported a remaining $2.2 million general fund deficit from 2025.
Preliminary figures released in September projected a $21 million general fund shortfall for the 2027-28 biennium. Since then, Hurst has laid off 14 employees and removed several vacant positions. Those reductions followed nine employee layoffs under Frizzell in 2025.
Council members said Monday’s tax decision would provide time to pursue structural budget changes during the next two years. Council member Robert Leutwyler supported the increase as a necessary step for the city. Members also acknowledged the burden on residents, who will likely face an additional property tax increase from a South County Fire bond that appeared headed for passage as of Tuesday.
City staff said they plan to publicize assistance available to residents. Snohomish County offers property tax relief to some older residents and people with disabilities. The Snohomish County Public Utilities District provides electricity and water rate discounts to income-qualified households, while Lynnwood operates a separate utility assistance program for qualifying residents.
Council President Nick Coelho expressed interest in pursuing policy options next year to help address household costs even as broader rates may rise. In September, the council repealed a utility rate increase scheduled for 2027. Because utility revenue goes into a fund separate from the general fund, that repeal did not change the general fund deficit.
The council also appointed Jamie Carnell as finance director Monday. Carnell worked for Seattle for 31 years, including service as its finance director from August 2024 through January 2026. Council Vice President Derica Escamilla welcomed the experience Carnell brings to Lynnwood. Budget discussions will continue before the scheduled final vote.
