Today, the City of Tacoma’s Finance Department presented an updated financial forecast for the 2027-2028 Biennial Budget. Following the recent introduction of the City’s “Roadmap to Recovery”—a proactive, multi-year strategy to protect core services, balance the budget, and secure Tacoma’s long-term fiscal health—this latest forecast details the impacts of national inflation on municipal operations and outlines next steps.
The financial forecast identifies a projected $40 million structural gap in the General Fund for the upcoming 2027-2028 biennium.
Driven by compounding macroeconomic pressures, the City’s expenditures are currently growing at 4.8%, nearly double the 2.9% growth rate of its revenues. While the City is navigating severe fuel price volatility and soaring costs for building materials and contracted services, another significant factor in this structural gap includes broad operational inflation, like the cost of employee healthcare, which surged 41% between 2021 and 2025 due to national healthcare market trends outside the City’s control.
The City is approaching these challenges from a foundation of sound fiscal management, with a multi-biennium strategy designed to stabilize spending through structural realignments to keep Tacoma on solid footing through 2030 and avoid reactive, short-term solutions. These proactive, methodical choices will include prioritizing essential public safety and infrastructure services.
Recognizing that City employees are essential partners in delivering high-quality public services, the City is also engaging in open, transparent conversations with its 31 bargaining units to find sustainable operational solutions.
The 2027-2028 Biennial Budget planning process is designed to be highly collaborative, and the City is actively inviting public input so that community values drive the recovery process. Community members are encouraged to share their priorities through upcoming community surveys and interactive online resources, like the Balancing Act Tool.
Additional details on the Roadmap to Recovery – and opportunities for community members to engage in the 2027-2028 Biennial Budget planning process – will be available at tacoma.gov/roadmaptorecovery.