May 4, 2005 - While the conversation about Oro Valley's financial future continues, the council is readying for this year's budget process.
The town manager delivered his recommended budget for 2005-06 April 25, which totals more than $93.1 million in spending on town services and related expenses.
Finance Director David Andrews said he believes this year's budget is a "solid" one.
He pointed out that the budget will go down by more than $24.7 million from this fiscal year to the upcoming one, due mostly to the completion of several major road projects, the completion of a large part of the reclaimed water system in the town, and the using up of cash from past bond proceeds.
The new budget lays out a staffing increase of 10 and a half new positions, bringing the total town staff to 325. Requests for new staff again include creating an assistant town manager position, which has been taken out of the budget several times in the past.
An increase in council members from five to seven last year, as well as the growth of the town due to annexations, are given as justification for the request in the budget. An assistant town manager "would better provide the town the ability to be represented in all stages of project management plus assure Oro Valley is properly represented in regional matters," according to the request, as Town Manager Chuck Sweet finds his calendar regularly in conflict without an assistant.
Other staffing requests include the addition of an assistant town prosecutor in the legal department to keep up with increased activity in the criminal division of the town. Despite personnel additions in the police department and population increases, resulting in an increase in the number of tickets being issued and arrests being made, the criminal division has not added a staff member since 1990, according to the written request.
After spending an estimated $88,000 on outside legal counsel and related professional services last year, the legal department also requested an increase in its budget of $150,000 to help keep up with the work load. Management is recommending the council approve $100,000 to cover those costs in the upcoming year.
Hiring one person to serve both as file clerk and victim's right coordinator also is included among the recommendations.
In Public Works, three positions in the transit department are requested to help keep up with the growing Coyote Run service. The service, available to residents older than 62 or those with disabilities, had a 10 percent increase in the number of trips made last year and expects an additional increase in the coming fiscal year.
Five new positions are requested by the Oro Valley Public Library to help staff the expansion of the facilities. This fall, 10,000 additional square feet will be opened in the library, which will include larger areas set aside specifically for children and teens.
The council began reviewing the budget in a work session May 2. There will be four additional study sessions scheduled throughout May, at which time the document will be broken down into sections and examined by council members. While the council has had just over a week to look at the 625-page budget, council members said they have issues that will be important to them while working toward approving the manager's recommendations.
Councilman Terry Parish said he will be looking at the budget closely to see if the town is preparing itself for any additional growth. For example, he said he will want to make sure there are enough police officers on staff to protect any areas the town knows it will be annexing.
"We need to be prepared for the growth we know is coming," he said. "It's going to be a tight budget, as always, and we will have to deal with each issue as it comes up."
The police department submitted a request for the addition of 17.5 positions, including a lead IT forensic technician, two detectives, two patrol officers, an office specialist, a lead dispatcher, a records specialist, seven patrol officers, a dispatcher, a DARE officer and a part-time maintenance technician. The requests were made in anticipation of the department feeling the strain of the new Northwest Medical Center, related medical facilities and newly developed retail businesses, and at the same time keeping up with a growing population. None of the requested positions are being recommended by Sweet to the council for approval.
Councilwoman Helen Dankwerth agreed with Parish that the budget will likely be tight and said her main concern will be the same as it was last year - making sure the budget is balanced without dipping into the contingency fund for ongoing expenses.
"The contingency fund is for one-time expenses and emergencies," she said.
The contingency reserves, as noted in a memo distributed with the budget by Sweet and Andrews, are estimated to be about $28. 5 million, or 28 percent of the town's total budget.
Expenditures are balanced, as laid out in the memo, using a combination of revenue, long-term debt financing and cash reserves. Revenues are up from $45.7 million last year to a total of $51.5 this year.
Like Parish, Dankwerth also agreed that the council will need to look at the needs of the town in terms of the staff and make sure there are enough necessary funds to provide for that staff.
Dankwerth said she also is concerned that some of the town's capital improvement projects have been on hold for years because the town has not had the money to fund them.
Andrews said funds for many capital projects, including water system projects and improvements and maintenance of roads, have been sufficient. The issue with the projects last year, he said, had to do with those that were recommended to be funded with money from the general fund contingency.
For example, the police department had requested a storage facility in last year's budget, which was recommended for approval by the manager, using contingency funds to pay for it.
Andrews said the staff is proposing the use of about $850,000 from the general fund contingency to pay for capital projects in the next fiscal year.
There is $18 million in the budget for capital projects for next fiscal year. More than $7 million of that is 2004 Pima County bond money for the library completion, construction of the CDO Linear Park, and the acquisition of Steam Pump Ranch, Honey Bee Village and Naranja Town Site land. Other projects budgeted include roadway system improvements and various other road projects throughout town.
Dankwerth said she believes the town will see an increase in state shared revenue and money it is receiving from additional sales tax dollars as a result of annexing land known as Area B, bounded by Northern Avenue on the west, First Avenue on the east and Suffolk Drive on the south, which includes Plaza Escondida and La Entrada shopping centers and commercial areas on both sides of Oracle and Magee roads.
But at the same time, expenses for the town continue to rise. For example, both employee health insurance and dental insurance are each expected to increase in cost by 7 percent. The town pays 100 percent of the employee coverage and 75 percent of any dependent coverage. It also is recommended the town provide up to 4 percent merit raises this next year, for those who qualify, and award 2.3 percent cost of living adjustments to all employees.
"We have a little more funding, but on the other hand, expenses are always going up," Dankwerth said. "It's going to be a balancing act."
Councilman K.C. Carter said the budget is a huge document that the council will slowly be working its way through over the coming months, scrutinizing it to make sure all of the town's money is well spent.
He, too, said the priority is to adopt a balanced budget.
"I want a balanced budget, same as I did last year," he said. "I am going to follow the trail of money and see where it goes and for what."