Tentative Budget Adoption Presentation

Council Chambers|Friday, May 2, 2025
Tentative Budget Adoption
FY 2025-26 Proposed Budget
2026-2035 Capital Improvement Program (CIP)
“Strength in Numbers”

Statutory Budget Process
A.R.S. 42-17101 to 17108
• Adopt a tentative budget that sets forth the different amounts 
that will be required to meet the political subdivision’s public 
expense for the fiscal year
• Enter into the minutes of the governing body
• Prepare according to forms supplied by the auditor general
• Publish on the website for public review
• Once tentatively adopted, budget cannot increase
• After tentative adoption, a public hearing shall be had wherein 
any taxpayer may be heard in favor of or against any proposed 
expenditure or tax levy (set for June 12, 2025)
• Hold Special meeting after public hearing to adopt the Budget 
(set for June 12, 2025)
• Adopt final tax rate on or before 14 days before taxes are levied, 
but after the public hearing (set for June 26, 2025)

0.01% decrease 
overall all Funds
$783.2M operating (+4.1%)
$845.7M capital (-3.5%)
5.5% increase in 
General Fund
$462.9M operating (+5.5%)
$152M capital (+9.9%)
FY 2025-26 Proposed Budget 
Total Budget $1,628,875,875 | Total General Fund: $615,641,303
Proposed Budget
•
Adheres to financial policies and is structurally balanced
•
Ongoing for ongoing and one-time for one-time
•
Uses Strategic Framework to guide decisions
•
Provides for cost-effective, quality services
•
Maintains long-term financial sustainability
•
Resident engagement through input opportunities
•
Kickoff, Resident Budget Survey & Three Workshops
•
All-day Budget Briefing
•
Tentative and Final Adoption in May/June
“Strength in Numbers”

FY 2025-26 Budget Drivers (all funds)
Revenues
• Revenues reflect actual economic environment with analysis on sustainable level
• Increases coming from continued increased local spending (slowing) with decreases from 
remaining residential rental revenue
• State Shared revenues updated with latest projections using State and League forecasts
Expenditures
• Funding to convert one-time funded positions to ongoing, maintain service delivery after 
adjusting for inflation, and ensure social safety net services continue
• Personnel costs increasing to build the strength of our workforce to meet evolving resident 
expectations.  Reflects ongoing savings from PSPRS employer contribution
• Capital projects increased for new infrastructure and carry forward of projects underway
Grants
Ongoing 
Savings with 
One-time $
• Federal changes are being monitored in previously identified grants with a continued focus on 
finding grant opportunities for which the city may qualify.  
• Maintain funded status of PSPRS to ensure unfunded liability does not grow

Operating Budget Highlights
Maintains city 
Transaction Privilege Tax 
(TPT) rates (lowest in Arizona)
and reduces primary 
property tax rate (10th
consecutive year)
Water, Wastewater, and 
Solid Waste rate changes 
are planned in the new 
Fiscal Year to ensure 
funds are self supporting
Budget maintains 
existing service levels in 
an increasing cost 
environment
Adds funding for labor 
association 
commitments and 
general employee 
merit/market
Maintains Public Safety 
Personnel Retirement 
System (PSPRS) full 
funding status with $25M 
in one-time funding
Maintains strong 
reserves (includes 15% 
General Fund 
contingency reserve and 
$10M budget 
stabilization reserve)

Total Annual Proposed Budget
All Funds (in millions)
Where the 
Money 
Comes From
Where the 
Money Goes

Average Annual Residential Cost Comparison 
for Direct Services
The average annual 
cost of services across 
the valley is:
$2,513

2026-2035 CIP Highlights
•
2026-2035 CIP total is $2,617,730,721 
($129M more than the 2025-2034 CIP) 
•
Updated to reflect additional utility 
projects and updates project cost 
estimates to current values
•
Increased focus on aging infrastructure
•
Includes projects utilizing potential new 
bond authorization in years 3-10

Proposed FY 2025-26 CIP Appropriation
(all funds)
Capital 
Carryforward
$567.7M
Contingency &
Reserves
$0.45M
New 
Funding
$277.9M
$845.7M
Total CIP 
Appropriation

Budget Event
Date
Council Budget Kickoff 
Completed Oct.
Citizen Budget Survey 
Completed Nov. - Jan.
Council Workshop #1
Completed Feb.
Council Workshop #2
Completed early Mar.
Council Workshop #3
Completed late Mar.
All Day Budget Briefing
Completed May
Council Meetings 
and Statutory 
Requirements
Tentative Budget/CIP Adoption
Tonight
Budget Public Hearing and Final 
Adoption 
June 12, 2025
Adoption of Tax Levies
June 26, 2025
Key Budget Dates

For your consideration:
Res. #5905 approves the 
Tentative Budget
Questions?