The Bellevue City Council is only a step or two away from finalizing a difficult 2011-12 operating budget and Capital Improvement Program.

At Monday’s meeting the group engaged in nearly four hours worth of discussion where they debated the merits of the last few aspects of the $353 million CIP and the $671 million operating budget.

The council is expected to take final action at its Dec. 6 meeting. The council has been working since September to deal with drops of $10 million in revenue for the budget, and $100 million for the CIP over the six-year span.

The final decisions on the CIP, which the council spent the majority of Monday’s meeting discussing, focused on less than 10 projects and pinning down the final $20 million.

The council may add projects slated to be cut from the CIP related to refurbishing neighborhood sidewalks ($1.5 million) work in West Lake Sammamish ($2.1 million) and expanding 145th Place Southeast ($5.2 million).

The costs of these projects would be offset by the reduction of the Northeast 15th Street design work by $12 million (from a starting point of $32 million).

While these projects garnered much debate, the surrounding factors played a role as well. Several city officials suggested passing a CIP this year that deals with many of the projects, but waiting until next year to make some big decisions on long-term issues. By waiting until the midpoint of the biennial budget next year, two overriding factors, the East Link light-rail deliberations, and the state of the economy could become more clear. Bellevue has a $25 million reserve set aside, potentially for funding a downtown tunnel, and another $6 million for East Link spending.

Council also discussed the potential of bonding so that phased projects such as 120th Avenue Northeast can be done in full.

“With the uncertainty of the impacts of both the rail and the economy, we didn’t think now was the time to talk about bonding,” said Mayor Don Davidson. “The best way to do it is to talk about what will slow down through 2011, have mid-term discussions, then we can discuss how to fund the remainder of the CIP, which is huge.”

While the economy has created great hardship for Bellevue, some good has come from it as well, council members said. The cost of construction is extremely low, so any project that is ready to go should start as soon as possible, they said.

“There’s just an incredible bidding and right-of-way climate, so we should take advantage of that and spend the money that we can now,” said Council member Claudia Balducci.

On the budget side, the council didn’t make any major changes to what’s been discussed thus far. On the discussion list of the budget is $7 million worth of line items. The main points of debate centered funding for events for groups like Bellevue Downtown Association and the Youth Link Advisory Council. Also still at issue are keeping arts funding and money for motorcycle police officers whole.

The budget is focused on maintaining human services, public safety and many of Bellevue’s other signature programs at current levels, while making changes within City Hall to help bridge the gap in the operating the budget.

City Manager Steve Sarkozy said this budget will lead to the reduction of 59 positions and require sacrifices from all city staff.

Many of the Sarkozy’s line items were vetted by council, and the few remaining represent important things to the community, but a small percentage of the actual budget.

“It’s a ($671 million) budget and once again, we’re down to questioning the last million,” said Council member Grant Degginger.