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KITTITAS COUNTY <br />BOARD OF COUNTY COMNIISSIONERS <br />STAFF REPORT FOR <br />STUDY SESSION <br />Auditor <br />STUDY SESSION DATE: 02-19-2026 <br />TOPIC: Current Challenges facing the Community Development Services Fund <br />ACTION REQUESTED: Informational only <br />LEAD STAFF: Zack DeHaven <br />RECOMMENDATION: Update on the current financial condition and outlook of <br />Community Development Services (CDS) Fund 402, including mitigation strategies and <br />cost -saving measures currently under consideration. ' <br />BRIEFING SUMMARY: Fund 402 continues to face financial challenges driven by <br />rising personnel costs, its largest expenditure - and declining building permit activity, its <br />primary revenue source. Director Bala and Finance staff have been meeting regularly to <br />monitor these trends, assess impacts, and identify potential solutions. Current projections <br />indicate a year-end 2026 fund balance of approximately $500,000 if no actions were to be <br />taken. <br />BACKGROUND: Following the transfer of Code Enforcement and Long -Range <br />Planning functions to the General Fund, a corresponding reallocation of administrative <br />costs is appropriate. This adjustment would help relieve financial pressure on Fund 402 <br />and better align expenditures with the services currently being provided. <br />The initial proposal includes reassigning 15% of Director Bala's personnel costs to reflect <br />actual management workload distribution, this is consistent with past practice involving <br />management of the Fire Marshal position. Staff time and associated costs would be <br />coded based on actual time distributions to more accurately reflect operations. Current <br />estimations are approximately $30,000 of shifted Director Costs plus actuals for the <br />remaining administrative staff and associated expenses to the General Fund. If there are <br />no objections to the proposed distribution of Director Bala's personnel costs, a Personnel <br />Action Form will be processed to reflect the 15% allocation. <br />Additionally, CDS has secured approximately $250,000 to offset staffing costs associated <br />with work to be performed in the coming years. This represents another step in the right <br />direction as the Staff continues to evaluate operations, strengthen funding strategies, and <br />improve the long -tern sustainability of CDS. <br />ATTACHMENTS: <br />Page 1 of 2 <br />Auditor "Study Session Staff Report", 02/19/2026 <br />