CMO Recommended Budget FY2027 - formatted 4.23.pptx
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CITY MANAGER’S
FY2027 RECOMMENDED BUDGET
$501.7 Million
May 5, 2026
Keith Fallstrom
Chief Financial Officer
1
Overview of Presentation
• Financial Policies Review
• Citywide Budget Overview
Recommended Budget
All Funds Revenues/Expenditures
General Fund Revenues/Expenditures
• Budget Highlights
• CIP Summary
2
Financial Policies
• Conservative revenue estimates
• Ongoing expenditures are paid for with ongoing revenues
• $26.5M of Construction TPT recognized for one-time
expenditures
• Impact fees will be used to pay for growth related capital
projects
• Continue to invest in the future (Fully Funded 5-year CIP)
• Maintain GFOA recommended 17% reserve fund balance
for General Fund of $31.2M and Enterprise Funds of $14.1M
3
FY2027 Recommended Budget
4
All Funds - Where Does the Money Come From? $501.7 Million
TPT (Sales
Taxes)
20%
Utility Rates &
Fees
24%
Intergovernmenta
l
12%
Licenses and
Permits
4%
Property Taxes
5%
Budget
Authority
4%
Charges
for
Service
s
7%
Bond Proceeds
11%
Grants
3%
Impact Fees/Dev
Contribution
4%
Miscellaneous
1%
Revenue
Contingent
3%
Fund Balance
2%
FY2027 Recommended Budget
5
All Funds - Where Does the Money Go? $501.7 Million
All Funds – By Category
Personnel Services
32%
Operating
Expenditures
40%
Debt Service
6%
Capital Outlay
15%
Budgeted Authority
4%
Contingency
3%
FY2027 Recommended Budget
6
City Sales Taxes - $95.4 Million, 19% of Budget
-
10
20
30
40
50
60
70
80
90
100
FY 2020
FY2021
FY2022
FY2023
FY2024
FY2025
Projected
FY 2026
Proposed
FY 2027
Millions
Non Construction
Construction
FY2027 Recommended Budget
7
State Shared Revenues - $56.2 Million, 11% of Budget
-
10
20
30
40
50
60
Millions
Vehicle License Tax
Highway User Tax
State Sales Tax
State Income Tax
FY2027 Recommended Budget
8
Permit Revenues - $20.8 Million, 4% of Budget
1,834
2,290
2,338
2,806
3,525
2,507
1,520
2,262
2,058
2,069
2,090
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
$0
$5
$10
$15
$20
$25
FY2017
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
FY2024
FY2025
Projected
FY2026
Proposed
FY2027
Millions
Permitting Revenues
SFR Permits issued
FY2027 Recommended Budget
9
Primary Property Taxes - $26.5 Million, 5% of Budget
1.8877
$1.6077
$1.6004
$1.5568
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$-
$2
$4
$6
$8
$10
$12
$14
$16
$18
$20
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
FY2024
FY2025
Projected
FY2026
Proposed
FY2027
Millions
Primary Property Tax Levy
Tax Rate
FY2027 Recommended Budget
10
Primary Property Tax Levy - $18.2 Million, 3.4% of Budget
$-
$2
$4
$6
$8
$10
$12
$14
$16
$18
$20
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
$1,100
$1,200
FY2022
FY2023
FY2024
FY2025
Projected FY2026
Proposed FY2027
Tax Levy in Millions
Assessed Value in Millions
Existing Assessed Value
New Assessed Value
Primary Property Tax Levy
FY2027 Recommended Budget
11
Primary and Secondary Property Tax Levy - $2.25 Combined Tax Rate
$0.00
$0.25
$0.50
$0.75
$1.00
$1.25
$1.50
$1.75
$2.00
$2.25
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
FY2024
FY2025
Projected
FY2026
Proposed FY
2027
Primary Rate
Secondary Rate
FY2027 Recommended Budget
12
Enterprise Revenue - $119.1 Million, 24% of Budget
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
FY 2020
FY 2021
FY 2022
FY 2023
FY 2024
FY2025
Projected
FY 2026
Proposed
FY 2027
Millions
Environmental Services
Wastewater
Water
FY2027 Recommended Budget
13
Awarded Grants
Total Budgeted Grants (Applications and Awarded)
$24,656,800
Grant
Amount
Arizona Lottery Fund
$500,000
Fire Grants
$1,591,800
Police Grants
$6,112,200
Street Sweepers
$439,000
FY2027 Recommended Budget
14
General Fund – Where Does the Money come From? $238.3 Million
TPT (Sales Taxes)
40%
State Shared Revenue
20%
Licenses and Permits
9%
Property Taxes
8%
Franchise Fees
2%
Charges for
Services
5%
Investment
Earnings
3%
Fines and
Forefitures
0%
Misc
1% Revenue Contingent
7%
Transfers In
1%
Fund Balance
4%
FY2027 Recommended Budget
15
General Fund - Where Does the Money Go? $238.3 Million
Excludes interfund
transfers
Personnel Services
57%
Operating
Expeditures
37%
Debt Service
3%
Capital Outlay
2%
Contingency
1%
FY2027 Recommended Budget
16
General Fund - Where Does the Money Go? $238.3 Million
Mayor & City
Manager Office
2%
City Attorney
1%
City Clerk
1%
Airport
1%
Communications
1%
Community Services
8%
Debt Service
3%
Development Services
7%
Economic Development
1%
Finance
4%
City Court
1%
Fire
16%
Police
20%
Human Resources
2%
Information
Technology
6%
Non-Departmental
10%
Program
Management
Office
2%
Public Works
14%
Contingency
1%
FY2027 Recommended Budget
17
General Fund Ongoing and One-Time Balances
FY2027 Recommended Budget
18
Personnel – Total Authorization – 1024 Positions
Adopted FTE
New
Revenue
Proposed FTE
Department
FY2026
Positions Contingent
FY2027
City Manager
15.5
-
-
15.5
City Attorney
18.5
-
-
18.5
City Clerk
6.5
-
-
6.5
City Court
19.0
-
-
19.0
Fire
157.0
15.0
-
172.0
Police
216.0
19.0
4.0
239.0
Communications
9.0
-
-
9.0
Community Services
101.0
1.0
1.0
103.0
Development Svc
93.0
1.0
3.0
97.0
Economic Development
11.0
-
1.0
12.0
Finance
48.5
-
1.0
49.5
Human Resources
16.0
1.0
-
17.0
Information Technology
33.0
2.0
-
35.0
Airport
5.0
-
-
5.0
Program Management Office
19.0
1.0
1.0
21.0
Public Works
77.0
3.0
3.0
83.0
Water Resources
117.0
5.0
-
122.0
962.0
48.0
14.0
1,024.0
City Manager,
15.5
City Attorney,
18.5
City
Clerk,
6.5
City
Court,
19.0
Fire, 172.0
Police, 239.0
Communications
, 9.0
Community
Services ,
103.0
Development
Svc, 97.0
Economic
Development,
12.0
Finance, 49.5
Human
Resources,
17.0
Informati
on
Technolo…
Airport
, 5.0
Program
Management
Office, 21.0
Public
Works, 83.0
Water
Resources,
122.0
Total Positions by Department
FY2027 Recommended Budget
19
Revenue Dependent Expenditures
14 positions – $2M ongoing revenue above forecast
• 3 Development Service dependent on increase in Development Service
revenue
• 1 Community Services dependent on increase in Community Services
revenue
Tyler Cloud Migration – $500K ongoing revenue above forecast
FY2027 Recommended Budget
20
Personnel – Employee Compensation
• All staff – 2.8% COLA
• Non-Public Safety staff - 5% Merit
• Represented Public Safety staff – Steps at 5%, 1 Step Increase
• Updating pension funding policy to allow more flexibility to reduce
unfunded liability
Budget Highlights
21
Asset Management Program $22.3 Million
Continuing maintaining and replacing current assets
• Community Services - $1.3M
• Fire - $1.2M
• Information Technology - $705K
• Pavement Maintenance - $7.1M (increase of $2.6M)
• Public Works Facilities - $1.2M
• Vehicle Replacements - $6.3M
• Water Resources - $4.5M
Budget Highlights
22
Public Safety
34 Recommended Positions:
• 12 Sworn Officers, 3 Police Sergeants, 1 Lieutenant, 2 Public
Safety Information Specialists, 1 Forensic Analyst (Grant position)
• 9 Firefighters, 3 Engineers, 3 Captains for Victory Fire Station
4 Revenue Contingent Positions:
• 2 Civilian Investigators, 2 Criminal Intelligent Analysts
Police Motorola – Body Worn Camera Software
Police – Enhanced use of AI Software
Budget Highlights
23
Community Services
Public Art Projects
• Wrapping Traffic Cabinets, Irrigation Boxes, and Library Return
Boxes
Joe Foss Special Interest Classes
• Joe Foss master plan to be completed in FY2027
Veterans Event
• New Concert Event honoring Veterans and current military
Budget Highlights
1 Recommended Position:
• 1 Project Coordinator (Administrative Services)
3 Revenue Contingent Positions:
• 1 Project Coordinator (Business Services), 1 Permit Technician II,
and 1 Senior Civil Engineer
Major 10-Year General Plan Update
Area Drainage Master Plan (ADMP) Phase II (SR-85, Oglesby to
Rooks Roads)
24
Development Services
Budget Highlights
25
Public Works
3 Recommended Positions:
• 1 Fleet Maintenance Technician I, 1 Traffic Signal Technician,
and 1 Environmental Compliance Officer
3 Revenue Contingent Positions:
• 1 Equipment Operator, 1 Maintenance Worker II, and 1 Auto
Mechanic
Improve Public Safety Fleet reliability
Median Beautification Enhancements
Bucket and Boom Truck
FY2027-2031
5-Year CIP Plan
26
Category by Year
•
FY2026 Projects will continue into FY2027
•
FY2026 carryovers will be added to FY2027 totals for Tentative Budget
•
Public Safety and Transportation are primarily funded with GO Bonds
•
General Government Includes Airport, Development Services, Facilities, and
Information Technology (IT)
•
Includes excise tax bonds for some FY2028 and FY2029 projects
FY2026
FY2027
FY2028
FY2029
FY2030
FY2031
Community Services $ 4,600,000 $ 3,944,000 $ 15,824,000 $ 18,130,000 $ 1,750,000 $ 5,575,000
General Government
17,200,000
3,050,000
13,580,400
1,800,000
3,195,000
7,002,000
Public Safety
5,285,000
32,600,000
1,300,000
23,600,000
-
2,000,000
Transportation and Streets
56,348,500
22,180,000
27,400,000
96,270,000
15,595,000
13,360,000
Water Resources
68,084,800
14,210,000
63,250,000
44,300,000
48,000,000
58,000,000
$ 151,518,300 $ 75,984,000 $ 121,354,400 $ 184,100,000 $ 68,540,000 $ 85,937,000
FY2027-2031
5-Year CIP Plan
27
Funding Assumptions for Projects
• Use of Construction TPT and prior year surplus (fund balance)
• Impact Fees used for growth related projects
• Grant and Intergovernmental funding where available
• GO Bond funding used for selected Transportation and Public Safety
Projects
• Volatility continues in the market
• Unpredictable cost changes may be seen (tariffs, inflation)
• Supply chain and labor shortages can impact plan
• If needed will delay and extend projects due to these factors
FY2026
CIP Projects - Completed
• Taxiway H 1-inch Overlay and Hold Area P-608
• Airport Taxiway & Southern Apron Reconstruction
• Airport Perimeter Security Upgrades
• The Landing City Hall Space Planning TI
• Water & Wastewater SCADA Computer System Upgrade
• EPCOR Waterline Interconnect at Sienna Hills & McDowell Rd.
• Farallon Water Campus 16
• Miller Rd., Durango St. to Lower Buckeye Rd.
• Miller Road Interim Improvements
28
FY2026
CIP Projects – In Progress
29
Communication Tower –Tartesso
Festival WRF Improvements Phase 2
Roadway Improvements: McDowell,
Jackrabbit Tr. to Tuthill Wash
Tartesso Fluoride Treatment
Rooks Rd. Bridge at BID (Roadway &
Bridge)
Apache & Southern Intersection / Traffic Signal
Downtown Enhancement Program
Communication Tower –Festival WRF
Sundance WRF Improvements
Traffic Signal-Jackrabbit Trail & Van Buren
Street
Central WRF Improvements Phase 3
Skyline Regional Park Phase 2
Tartesso WRF Improvements Phase 2
Jackrabbit –McDowell to Thomas
CIP Projects – Transportation
30
Project
Total
Miller Widening – Broadway to Lower Buckeye (Including
Signal) (FY2026 – FY2029)
$ 25,000,000
Verrado Way - Yuma Road to Van Buren Street - Roadway
Improvements (FY2026 – FY2027)
$ 16,000,000
Downtown Storm Drain Project (FY2026 - FY2029)
$ 29,400,000
Jackrabbit Trail, Thomas to Indian School (FY2026 - FY2029)
$ 27,160,000
Indian School Road - Jackrabbit to Perryville (FY2026 & FY2029)
$ 28,160,000
Watson Road, Elwood to Pioneer (FY2026 - FY2029)
$ 9,600,000
Southern Widening - Apache to Watson (FY2029 - FY2030)
$ 6,660,000
Right of Way Traffic Interchange - I-10 & Dean Road (FY2029-
FY2030)
$ 5,400,000
CIP Projects – Traffic Signals
31
Project
Total
•
Rainbow Road & Sundance Parkway Traffic
Signals (FY2027)
$ 1,000,000
•
Sienna Hills and McDowell Traffic Signal (FY2028)
$ 1,950,000
•
Traffic Signal TBD (FY2031)
$ 2,500,000
•
Broadway and Apache Traffic Signal (FY2031)
$ 2,175,000
•
Lower Buckeye and 247th Traffic Signal (FY2031)
$ 1,110,000
•
Yuma and Apache Traffic Signal (FY2031)
$ 1,110,000
CIP Projects – Public Safety
32
Project
Total
•
Victory Fire Station #709 (FY2026 – FY2027)
$ 17,600,000
•
Westpark Fire Station #706 (FY2026 – FY2027)
$ 17,700,000
•
Public Safety Training Facility (Phase I) (FY2026 – FY2029)
$ 17,800,000
CIP Projects – Water &
Wastewater
33
Project
Total
•
WW – Central WWTP 1.5 MGD Expansion (FY2025 – FY2031)
$ 72,025,700
•
WW – Central WRF Improvements Phase 3 (FY2024 – FY2031)
$ 25,092,400
•
WW – Citywide Effluent Management: Central WRF to RID
(FY2026 – FY2029)
$ 23,174,800
•
WR – Valencia System Distribution Mains Upgrade (FY2026 and
FY2029)
$ 13,203,000
•
WR – North Airport WC Expansion (FY2026 and FY2030)
$ 27,000,000
•
WR – Citywide Brine Management (FY2028 – FY2031)
$ 13,000,000
•
WR – Sun Valley Water System Improvements (FY2026 – FY2028)
$ 4,250,000
CIP Projects – Other
34
Project
Total
Community Services
•
North Library - Festival Foothills (FY2027 – FY2028)
$ 20,063,000
•
Sundance Park Pickleball and Enhancements (FY2028 – FY2029)
$ 9,680,000
•
Earl Edgar Recreational Facility Improvements
& Senior Center Parking Expansion (FY2029)
$ 9,150,000
Municipal Court
•
Courthouse Expansion (FY2029)
$ 5,910,000
FY2027
Recommended Budget
The picture can't be displayed.
May 19, 2026
Adoption of Tentative Budget
The picture can't be displayed.
June 2, 2026
Truth-in-Taxation and Adoption of Final
Budget (Public Hearing)
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June 16, 2026
Adoption of Property Tax Levy
35
Questions?
36