The budget-planning season for the Marana and Oro Valley town councils has come and gone with the final products being approved in recent weeks.
Oro Valley passed its final $94.2 million budget on June 15. Marana’s $127 million fiscal plan for 2011-2012 was ratified on June 22.
In what town officials are calling a structurally sound budget, the $127 million plan for the coming year, which begins July 1, still reflects a 25-percent decrease from the previous year.
The reduction is attributed to a decline in capital improvement projects. All other departments either were increased or stayed the same.
With increased population numbers released by the U.S. Census Bureau, the Town of Marana was able to work with added state-shared revenues. The additional funding will be used to increase personnel or fill vacancies left open during the recession.
“The budget is a reflection of Marana’s values and priorities,” said Town Manager Gilbert Davidson. “It’s the result of hard work and dedication of town employees.”
A lot of the decision-making for this year’s budget centered around the Marana Economic Recovery Plan approved by the town council in January.
The plan is based on an economic analysis that projects a slow, multi-year recovery of local sales tax collections and state-shared revenues.
The adopted 2012 budget includes investments amounting to $3.4 million. That figure includes $819,000 for staff, $2 million for resources and another $571,000 to fill strategic positions, including the restoration and creation of seven full-time positions.
In other terms, town officials said $1.4 million reflects ongoing investments, while the remaining $2 million goes toward one-time investments.
Town officials said the town’s overall fiscal health is strong. The estimated general fund reserve balance is $14.3 million. It provides an adequate cash balance that will allow the town to maintain bond ratings and provide capacity for future major projects.
Passing the $94.2 million fiscal plan for the upcoming fiscal year wasn’t as easy for the Oro Valley Town Council.
The council finished budget discussions with a vote to approve the final product on June 15. The measure was passed in a 5-2 vote, with councilmen William Garner and Barry Gillaspie voting no.
In what council members are calling a “stopgap” budget, a major source of contention became the approval to double the town’s utility tax.
In a 5-2 vote, with Garner and Gallespie voting no, the council approved increasing the utility tax from 2 to 4 percent, starting in August. While it is estimated to impact the average household by $6 per month, many residents spoke against the increase during the budget-planning process.
With revenues down, town officials said the increase will result in an additional $1.3 million in revenues for 2011-2012.
Besides the utility tax, the council unanimously approved increasing parks and recreation fees to use the ramada and ball fields, as well as daily and annual pool admission fees and lane-rental fees for the pool.
Altogether, the budget estimates the increases will bring the city $73,500 in added revenues.
The council is still considering whether to retain the Coyote Run Transit System, which costs the town a minimum of $220,000 per year.
If kept, Coyote Run will be funded through the bed tax. The council is expected to continue discussions on July 20.
The new budget reflects a 19-percent decrease over last year, a result of declining revenues and the town’s population growth being less than expected.
According to data provided by the U.S. Census Bureau, Oro Valley grew by more than 30 percent between 2000 and 2010, just not as much as expected.
Town officials projected a population between 43,000 and 45,000 people. However, actual numbers had the current town population at just over 41,000.
Throughout the planning process, Councilman Garner called for more discussion in preparing for the new fiscal year, calling for more efficiency.
While the remaining council members agreed major changes are needed, they vowed to make them in the 2012-2013 fiscal year.
Acting Town Manager Greg Caton said with a working budget in place, the town now has 12 months to restructure finances.
“I am confident in working with the staff and council that we can streamline operations and am optimistic revenues will increase,” he said. “There are opportunities on both sides. We can gain more revenues, and in other areas, we can take advantage of opportunity to become more efficient with expenses.”