Less than three months into the year, the City of Seattle is projecting more than a $100 million budget deficit in 2010. The largest portion—roughly $74 million—results from a massive revenue shortfall at Seattle City Light, which generates more electricity than the region needs and sells hydro-electric power to other cities. However this year, light snowfall has depleted the estimated electricity city light can generate; whereas the city had estimated it could sell about $120 million in electricity, the city now estimates it can sell only $46 million, says Mayor Mike McGinn’s spokesman Mark Matassa.

The city is projecting shortfalls in other departments, including the Seattle Department of Transportation, which will likely run in the red about $5 million, and the Seattle Parks and Recreation Department.

Mayor McGinn will outline new strategies for balancing the budget at briefing this afternoon to outline new revenue sources. (I'll be on an airplane, but Cienna will go and write up a post about McGinn's proposals.) “We are trying to take steps to put city on sustainable budget and put revenue and expenses in alignment instead of patching it up,” says Matassa. Last year, the city council released a budget that covered costs, in part, by tapping the city’s rainy day fund.

“We still don’t know how big the problem is,” says Matassa. “Instead of letting these things dribble out as they come in, we will say what we knew so far.”

In addition, he city estimates that its general fund—which is separate from utilities—will be $50 million in the hole next year.

In a letter to city employees on Monday, McGinn announced the creation of a new City Budget Office, headed by Beth Goldberg. Meanwhile, Fred Podesta will head the city’s Finance and Administrative Services. Glen Lee will replace Dwight Dively as the city’s Finance Director.