The recession continues to hit Renton’s budget hard – with a budget deficit expected to grow to eight percent this year, Mayor Denis Law told a packed luncheon crowd Wednesday at his State of the City address.

But the mayor also struck a hopeful note at the end of his speech at the Holiday Inn.

“The hard times will end and the economy will turn around,” Law said.

In the meantime, Law said the city will emphasize effectiveness, efficiency and accountability. He outlined many of the accomplishments the city, business community and citizens achieved in the past year.

Law began his speech with an analysis of the challenges facing the city’s budget.

The city’s total 2009 budget is $252 million, of which approximately $100 million pays for police, fire, roads, parks and recreation, and other key services.

The decline in consumer and business spending is expected to continue and result in reduced sales tax collection for the city, he said. That will lead to he budget deficit of at least 8 percent, he said.

The city is looking for ways to close that deficit, with the least impact on services to the community and on city employees. The city already has 47 unfilled positions and is facing the layoff of 18 more employees.

“Despite these reductions in staff, I’m committed to maintaining our ability to provide quality emergency ervices for our residents and businesses,” he said.

Employment citywide is expected to decline about 3 percent this year and housing permits have dropped from more than 1,300 units in 2007 to less than 450 units last year and are anticipated to continue to go down, he said.

But there are positives, he said.

Renton was one of only three cities in the Puget Sound region to see a positive growth in retail sales, which was among the highest in the region at over 3 percent in 2008, he said.

Renton’s assessed valuation has increased almost 100 percent over the last seven years, from $5 billion in 2001 to nearly $10 billion in 2008. Employment growth for Renton between 2005 and 2008 outpaced that of King County by 4 percent.

“Now is the time for us to put our city on a new path that will lead to fiscal accountability, greater efficiencies, and a culture of innovation,” said Law. “Now is the time to stand up for our city, because this is a city worth fighting for.”

The mayor highlighted several accomplishments, including:

• Renton’s population has doubled from about 40,000 in 1990 to more than 80,000 in 2008, in part due to the annexation of the Benson Hill area and other neighborhoods adjoining Renton.

• Public safety has been improved with increased police patrols in downtown and transit center.

• The city implemented the successful photo enforcement program (more than 18,500 citations were issued) at some of the city’s busiest intersections, with a majority being given to non-Renton residents

• The city launched anti-graffiti initiative and passed ordinance to punish offenders.

• The city responded to several major storms this past winter – city trucks and snow plows cleared over 13,000 miles of local roads

• The city provided blood pressure and blood sugar screenings during Renton Heart Month, when more than 500 people received CPR training.

• Numerous businesses opened in 2008 at The Landing and throughout the city, and several new restaurants and retail stores opened downtown

Renton drew several large employers to the city, including Providence Health and Services, the Seattle Cancer Treatment and Wellness Center and Downtown Harley Davidson.

• The Duvall Avenue construction project in the Highlands is to be completed this summer, on time and on budget.