Authorization to Enter into Intergovernmental Agreement with Arizona Board of
Regents for Development of Arizona State University Health Headquarters and to
Enter into Lease of a City-Owned Property Located at the Northeast Corner 4th
Street and Fillmore Street (Ordinance S-52677) - Council District 8

Authorize the City Manager, or the City Manager's designee, to enter into an
Intergovernmental Agreement (IGA) with Arizona Board of Regents (ABOR), and to
execute any other instruments or documents necessary, including a lease pursuant to
City Contract 142599, to facilitate the development of facilities to house the Arizona
State University (ASU) Health Headquarters and other academic units on City property
in downtown Phoenix. Additionally, request authorization for the City Treasurer to
accept funds and the City Controller to disburse funds. The City will participate in the
project through approximately $12 million from the 2023 General Obligation Bond
Program and approximately $38 million from the Sports Facilities, Biosciences, and
Tourism Fund.

THIS ITEM IS FOR DISCUSSION AND POSSIBLE ACTION.

Summary
ABOR proposes to develop the ASU Health Headquarters (ASU Health HQ) building
on an approximately 0.89-acre City-owned property (Site) combined with a 0.17-acre
ABOR-owned property for a total site that is approximately 1.06 acres. The Site is
located at the northeast corner of 4th Street and Fillmore Street. The remaining parcel
on the block remains under private ownership.

ABOR will be investing approximately $160 million in downtown Phoenix to construct
the 175,000 square foot, five-story ASU Health HQ. Initial plans for the building include
housing the John Shufeldt School of Medicine and Medical Engineering. This medical
school blends clinical education, engineering, artificial intelligence, interprofessional
collaboration, humanism, and systems thinking to train doctors who have the vision to
transform the medical system. The building will also house the School of Technology
for Public Health and professional training programs in the Edson College of Nursing
and Health Innovation and College of Health Solutions.

The City will contribute a total of $50 million to the project in addition to the City-owned



parcel. Approximately $12 million will come from the 2023 General Obligation Bond
Program approved for this project. The Bond funds will be paid as a lump sum upon
construction commencement of the project. The City will also contribute approximately
$38 million in total from the Sports Facility, Biosciences, and Tourism Fund paid in
annual increments over the next ten years, starting on June 1, 2026.

ASU and the City will use the facility to work in collaboration on three strategic pillars:
(1) City Employee Health and Safety Innovation, (2) Urban Public Health and
Resilience, and (3) Health Programs to support the Phoenix population. The details of
this partnership will be further detailed within the IGA.

The facility will include traditional and virtual reality classrooms, health care simulation
and skills labs, a medical technology innovation suite, and faculty and administrative
offices. Building amenities will include community learning spaces, student
engagement as support spaces, a library, and convening spaces. The lobby will also
include spaces where the public can interact with personal and public health
information. ASU has agreed to allow the City to host, without a use charge, up to two
events per year at the Project.

The City will lease the property to ASU, pursuant to terms of IGA 142599 between the
City and ABOR that was executed in May of 2016. There will be no rent for the lease
during the first eight years of the term, after which ASU will pay the City a rental rate of
$1.85 per square foot of land, escalated through the date the City Council approves
such Subsequent Phase Lease by the lesser of either the cumulative increase in the
Phoenix-Mesa Consumer Price Index or three percent per annum. The City and ASU
will not be permitted to sell or dispose of their parcels during the duration of the lease.
Upon successful completion of the 30-year lease term, the City will convey title of the
City-owned parcel to ASU.

Financial Impact
The General Obligation Bond Funds are programmed in the budget for Fiscal Year
2026-27 and will total $11,881,188. The Sports Facility, Biosciences, and Tourism
Funds are available starting this Fiscal Year with a total amount of $38,118,812 to be
paid over ten years. There will be no impact to the General Fund.

Concurrence/Previous Council Action
The original IGA, City Contract 142599, was authorized on May 19, 2015, by
Ordinance S-41736.

Location
The facility will be located at the northeast corner of 4th Street and Fillmore Street


(APN 111-46-156).
Council District: 8

Responsible Department
This item is submitted by Assistant City Manager Ginger Spencer and the Community
and Economic Development Department.








Report

2026 NCAA Women’s Final Four Update - Citywide

This report provides the City Council with an update on planning and coordination
efforts in preparation for hosting the 2026 National Collegiate Athletic Association
(NCAA) Women’s Basketball Final Four including information on official Final Four
events to be held in the City of Phoenix.

THIS ITEM IS FOR INFORMATION AND DISCUSSION.

Summary
In October 2020, Phoenix was selected to host the 2026 NCAA Women’s Final Four.
This will be the first time Phoenix has hosted the NCAA Women’s Final Four, having
previously hosted the Men’s Final Four in 2017 and 2024.

Many official activities and events will take place throughout downtown Phoenix over
multiple days from April 1 through April 5. The City-owned Mortgage Matchup Center
will host the semifinal games on April 3 and the championship game on April 5.
Additionally, the arena will also host the Super Saturday Practice on April 4, which
includes two free open practices for basketball fans to see the final two participating
teams up close prior to the championship game. From April 2 through April 5, the
Phoenix Convention Center will host both Tourney Town, a fan festival, and the
Women’s Basketball Coaches Association annual convention. Outside the Phoenix
Convention Center, the Four It All Fest will take place as a block-party-style event.
Margaret T. Hance Park will serve as the location for the Super Saturday Concert on
April 4. Additionally, a youth basketball Bounce event will take place on April 4. The
Bounce is an opportunity for youth under the age of 18 to dribble a basketball through
parts of downtown Phoenix into the Phoenix Convention Center followed by a day at
Tourney Town.

Washington Activity Center has been selected as the NCAA's Legacy Restoration
project. The Legacy Restoration project is an opportunity for the NCAA to leave a
lasting impression on the community. Refurbishment of the indoor and outdoor
basketball courts is being planned and coordinated with the Parks and Recreation
Department. The project is anticipated to be completed by Final Four Week and will be
dedicated on April 1, 2026.




Staff from multiple City departments are working in partnership with the NCAA and the
Phoenix Local Organizing Committee to plan a championship weekend of fan-related
activities including the fan festival, concert, and youth basketball Bounce event.

Responsible Department
This item is submitted by Deputy City Manager Cynthia Aguilar and the Phoenix
Convention Center Department.








Report

Fiscal Year 2026-27 Proposed City Manager's Trial Budget and Fiscal Year 2026-
31 Preliminary Five-Year Capital Improvement Program - Citywide

This report transmits a balanced proposed Fiscal Year (FY) 2026-27 City Manager's
Trial Budget for community review and comment. It also includes the Preliminary Five-
Year Capital Improvement Program (CIP), as required by City Charter.

THIS ITEM IS FOR INFORMATION AND DISCUSSION.

The Trial Budget is an important step in the City's budget development process. It
provides the Mayor, City Council, and community an opportunity to review a proposed
balanced budget months in advance of final budget adoption in June. This report
provides the proposed FY 2026-27 General Fund (GF) Trial Budget, which includes
new and expanded programs and services for the community, increases to employee
compensation, and set-asides to ensure future City budgets remain balanced.

The City of Phoenix is committed to engaging residents in the budget process, and this
year there are many opportunities for residents to provide feedback outside of
regularly scheduled City Council meetings. Between March 30 and April 16, the
proposed FY 2026-27 Trial Budget will be presented to Phoenix residents for input at
12 community budget hearings. A complete list of hearing dates and times is included
in Attachment D and is available on our website at https://www.phoenix.gov/budget.
All resident feedback received will be provided to the City Council, so it may be used in
budget decision making. As a result of public input, changes could be made to the Trial
Budget and reflected in the proposed City Manager's Budget, scheduled to be
presented to City Council on May 5.

This report also includes the Preliminary Five-Year CIP for City Council review (
Attachment E). The City Charter requires the City Manager to submit the Preliminary
CIP prior to adoption of the final budget.

The CIP represents investments in the long-term needs of the community through
infrastructure development and maintenance. The five-year program totals $11.4
billion, with a $2.7 billion program for 2026-27. The full report is available on the
Budget and Research Department website at phoenix.gov/budget.




Summary
As presented at the February 24, 2026, Policy meeting, the GF multi-year forecast
reflects an overall positive budget outlook, thanks to previous strategic actions by the
needed for operational and financial continuity, the FY 2026-27 available surplus was
estimated at $62 million, including $36 million in ongoing resources and $26 million in
one-time resources. The multi-year forecast reflected a baseline surplus in FY 2027-28
of $14 million and a deficit in FY 2028-29 of $(9) million.

Staff have completed the annual 7+5 technical expenditure and revenue review
process, and approximately $8 million in adjustments have been made to the FY 2026-
27 GF Status, primarily reflecting updated primary property tax and state-shared sales
tax revenue forecasts, as well as minor adjustments to anticipated user fee revenues.
These adjustments result in a gross surplus of $163 million; however, the net available
surplus is projected at $70 million, after accounting for resources needed for
operational and financial continuity, including a $75 million set-aside to balance FY
2027-28 and resources of $18 million needed for the Office of Homeless Solutions due
to expiring American Rescue Plan Act funding, as well as operating costs for new
parks. The revised FY 2026-27 projected available surplus of $70 million includes $43
million in ongoing resources and $27 million in one-time resources.

The proposed FY 2026-27 GF Trial Budget recommends allocating approximately $35
million of the surplus to key Council priority areas, including Community Health and
Safety; Children, Youth, and Families; Homeless Service Continuity; Housing
Affordability; and Planning and Development Customer Service Enhancements. It also
recommends allocating $53 million for investing in employees through compensation
increases to maintain competitiveness in hiring and retention and setting aside $75
million to help ensure the FY 2027-28 budget remains balanced. These allocations are
reflected in Attachment A. The proposed FY 2026-27 Trial Budget also includes
several small increases to the Aviation Department, which are reflected in Attachment
B.

The proposed FY 2026-27 Trial Budget also includes administrative position additions
and conversions of temporary full-time equivalent (FTE) positions to ongoing positions.
Funding for these positions has been identified and accounted for in department
operating budgets. Details on each position can be found in Attachments A and B.
Finally, this report includes the annual GF Revenue Estimates Report (Attachment C)
and the schedule of upcoming community budget hearings to engage residents and
gather feedback (Attachment D).



GF Resources
The revised FY 2026-27 GF Status reflects a projected available surplus of $70 million
and includes the beginning fund balance, net transfers, and revenues, which total
$2.297 billion or 4.9 percent higher than FY 2025-26 estimated resources. Revenues
make up the majority of FY 2026-27 resources and are projected at $1.991 billion,
representing 3.5 percent growth compared to FY 2025-26 revised revenue estimates.
As discussed in the Preliminary GF Budget Status and Multi-Year Forecast report
provided to Council on February 24, revenue projections incorporate information and
perspectives from key sources, such as the University of Arizona Economic Business
Research Center, Joint Legislative Budget Committee, and Finance Advisory
Committee, as well as significant internal analysis. Revenue projections assume no
new fee increases and no new sources of revenue.

Increases in FY 2026-27 GF revenues are primarily due to growth in state-shared
income tax revenues, which are based on collections from FY 2024-25 and reflect
solid wage growth and increased capital gains tax revenues. FY 2026-27 revenue
projections also reflect moderate growth in City and state-shared sales taxes, as well
as primary property tax revenue growth due to increases in assessed valuations and
new construction. Because of the these increases in assessed valuations and new
construction, the City's primary property tax rate is forecasted to slightly decrease in
FY 2026-27 from $1.2658 to $1.2652.

While FY 2026-27 revenue projections reflect modest growth from the current year,
they are tempered by a number of factors, including geopolitical and federal policy
uncertainty, ongoing concerns with affordability, and mixed economic data, including
weak contracting sales tax data and mild increases in the local unemployment rate.
The projections also account for the incorporation of San Tan Valley, which is projected
to negatively impact state-shared revenue distributions by more than $10 million in FY
2026-27. Finally, it should be noted that revenue projections do not account for any
negative impacts from potential state legislative action. Such action can have
significant impact on City revenues and expenditures, and staff continues to work with
Government Relations to closely monitor all legislation.

The FY 2026-27 GF estimates for each major revenue category, totaling $1.991 billion,
are highlighted below. Comprehensive detail on these categories and their forecast
methodologies can be found in Attachment C.

· Local Sales Tax - $834 million;
· State Shared Revenue - $711 million;
· Primary Property Tax - $233 million;



· User Fees - $213 million.

GF Expenditures
FY 2026-27 GF expenditures to continue existing levels of service are projected to be
$2.134 billion, or $2.039 billion excluding contingency funds. This compares to the FY
2025-26 GF expenditure estimate of $1.942 billion, representing an increase of $97
million or 5.0 percent excluding contingency funds. The increase primarily reflects
continued higher costs due to inflation, additional vehicle replacement costs, lower
anticipated salary savings from vacant positions, and increases in employee salaries
and fringe benefits, including higher pension costs discussed below and the continued
impact of the City Council-approved Classification and Compensation Study. These
increases are partially offset by lower planned costs for GF pay-as-you-go capital
improvement projects. Expenditure amounts may change over the coming weeks as
staff continues to refine final estimates prior to the presentation of the City Manager's
Proposed Budget on May 5.

Employee pension costs have consumed a growing share of the City's GF resources
over the past 10 years. GF pension costs in FY 2026-27 are estimated to be $486
million or 23.9 percent of total GF operating costs. The GF Multi-Year Forecast
included estimated increases of $46 million between FY 2025-26 and FY 2028-29.
This increase is primarily caused by rising public safety pension costs. The City is
committed, and legally required, to pay 100 percent of our actuarially required
contribution every year. Also, under the leadership of the City Council, a pension
funding policy has been adopted each year, as required by state statute. Additionally,
pension reform for the City of Phoenix Employees' Retirement System (COPERS) is
helping to stabilize civilian pension costs. While reform efforts have been successful
for the Public Safety Personnel Retirement System (PSPRS), there remains a
significant unfunded sworn pension liability of over $3.7 billion, per the PSPRS June
30, 2025, actuarial valuation.

Proposed GF Budget Additions and Set-Asides
Due to the leadership of the City Council and continued economic growth, the
proposed FY 2026-27 GF Trial Budget includes a $70 million available surplus. The
Trial Budget includes strategic allocations of $35 million to invest in key Council priority
areas, addressing community needs and enhancing City services. It also includes $53
million to increase employee compensation, ensuring the City remains market
competitive and is able to recruit and retain our most important asset - our people.
Finally, the Trial Budget includes a set-aside of $75 million to help ensure future
budget years remain balanced and continue to provide reliable service to residents.

Additional detail on the proposed FY 2026-27 supplementals is provided below and


also included in Attachment A.

Community Health and Safety - $1.2 million and 8.5 positions
Community health and safety remains a high priority for the City Council, and the Trial
Budget includes several supplementals designed to address this priority. First, it
proposes to invest $500K in one-time funds for additional streetlights and streetlighting
upgrades in the 27th Avenue Community Safety Plan corridor, to further the progress
made in improving safety and quality of life along 27th Avenue and the I-17 corridor.
Next, it includes $500K in one-time funds for security lighting enhancements at City
parks, helping to promote safe recreational opportunities for Phoenix residents. These
improvements include enhanced playground lighting at Buffalo Ridge, Moon Valley,
Sueno, and Western Star Parks, and perimeter lighting improvements at Hilaria
Rodriguez Park. Finally, the Trial Budget includes $266K in partial-year, ongoing
operating costs for the new 2023 GO Bond-funded Esteban Park recreation center and
for the new 395-acre Lone Mountain Park. These additions include 8.5 positions, with
combined full-year operating costs estimated at $764K.

Children, Youth, and Families - $7.3 million and 0.5 positions
Children, youth, and families are a vital part of the Phoenix community, and the Trial
Budget invests in them in several ways. First, childcare costs represent a significant
financial challenge for Phoenix families. The Trial Budget includes a $5 million set-
aside to address this challenge by exploring potential options to help bring down the
cost of childcare for Phoenix families. Next, the Trial Budget includes $1.5 million in
one-time funds to provide flexible emergency financial assistance to Phoenix
residents. This funding is intended to help prevent homelessness and stabilize housing
and food security for low-income individuals and families in light of recent reductions
and restrictions in federal funding. The Trial Budget also includes $500K in ongoing
funds, including 0.5 part-time positions, for the Parks and Recreation Department to
invest in several teen prevention strategies, including tutoring opportunities, enhanced
and expanded recreation programming, and to improve program affordability to ensure
Phoenix families can participate in Parks programs. Finally, the Trial Budget includes
$322K in ongoing funds for a parking lease at Cholla Library. Ongoing redevelopment
of the former Metrocenter Mall has reduced parking options for library visitors. This
funding will secure a dedicated parking lot for visitors, ensuring they can continue to
enjoy the library's offerings.

Homeless Service Continuity - $18.4 million and 0.0 positions
During the pandemic, the City Council strategically deployed American Rescue Plan
Act (ARPA) funding to address homelessness in the Phoenix area. As ARPA funding
expires, and to ensure progress made in this critical area continues, the Trial Budget
includes a total of $18.4 million in ongoing funds to continue key services. This


includes $12.9 million to continue shelter operations, both at City-owned facilities such
as the Phoenix Navigation Center, Safe Outdoor Space, and Washington Shelter, and
through nonprofit partner facilities, such as Rio Fresco, North Mountain Healing
Center, and the Central Arizona Shelter Services single adult shelter. Funding of $1.5
million will help continue summer heat relief efforts at the City's 24/7 heat respite sites
and three extended hour cooling centers. Additionally, the Trial Budget allocates $1.5
million to support the Keys to Change Key Campus operations, including the Brian
Garcia Welcome Center, janitorial services around the campus, and ensuring safe and
secure storage of client personal property. Finally, the Trial Budget includes $2.5
million for a master lease program. This program would enable the City to secure
master leases for rental housing units, which include on-site support services, to
sublease to individuals exiting homelessness to free up shelter bed space.

Housing Affordability - $6.6 million and 0.0 positions
The City Council established the Phoenix Housing Trust Fund in May 2025, and
adopted the Housing Trust Policy in November 2025, to further the City's commitment
to affordable housing. The proposed one-time $6.6 million increase to the Housing
Trust Fund would bring its total available resources to $15 million, representing a
significant investment in affordable housing. This funding includes $2 million
designated for waivers or reductions on affordable housing and related project plan
review, permit, and inspection fees, with rules on eligibility and amounts to be
determined by the City Council. It also includes $1 million designated for the creation
of pre-approved housing plans focused on affordability and the character of the city's
villages. Remaining funds would be deployed in accordance with the Housing Trust
Policy, furthering affordable housing efforts in Phoenix.

Planning and Development Customer Service Enhancements - $1.5 million and 0.0
positions
The FY 2026-27 Trial Budget includes $1.5 million in one-time funds for customer
service enhancements in the Planning and Development Department, focused on two
key areas. First, the funding will support improvements to the customer service
experience at Phoenix City Hall, including streamlined check-in processes, customer
flow, and other potential enhancements to the visitor experience. Additionally, the
funding will support continued customer service and process improvement initiatives,
which may include website enhancements, additional educational efforts on available
services and resources, and technology upgrades.

Set-Aside for Labor - $53 million
Investing in employees to recruit and retain talent remains a priority for the City
Council. The FY 2026-27 Trial Budget includes $53 million for employee compensation
increases and reflects a mix of ongoing and one-time funds. Current employee


contracts expire at the end of the current fiscal year, and management has been
negotiating with each bargaining unit. Exact details of the compensation packages will
be determined in the negotiations process.

Set-Aside to Balance the FY 2027-28 Budget - $75 million
The FY 2026-27 Trial Budget includes a set-aside of $75 million to help ensure the FY
2027-28 budget remains balanced. This strategic use of one-time funds allows for the
continuation of programs and services that residents rely on and helps ensure the GF
budget is sustainable into the future.

Non-GF Budget Additions - 1.2 million and 8.0 positions
The proposed FY 2026-27 Trial Budget also includes several Non-GF supplemental
budget additions for the Aviation Department, totaling $1.2 million and 8.0 FTEs.
These additions will support international airline operations, capital project
management, computer technology upgrades, water quality monitoring, and
administrative needs. Additional detail is provided in Attachment B.

GF and Non-GF Conversions to Maintain Services - $0 and 69.9 FTE
The Trial Budget includes 45.9 GF and 24.0 Non-GF new ongoing positions to provide
critical and sometimes legally required support for City departments. These positions
either represent conversions of existing temporary positions to ongoing status or are
new ongoing positions funded at no additional cost. Funding for these positions has
been identified and programmed in each respective department's operating budget.
These positions are reflected in Attachments A and B.

Preliminary Five-Year CIP
The Preliminary Five-Year CIP presented in Attachment E totals $11.4 billion. The first
year of the program, totaling $2.7 billion, will ultimately be updated for carryover and
resource availability and presented to the City Council for appropriation in June. The
remainder of the CIP is presented for responsible planning purposes and is dependent
upon resource availability. The full report is available on the Budget and Research
department website at phoenix.gov/budget.

Next Steps
In order to engage the community in the budget process, staff will be holding 12
community budget hearings between March 30 and April 16. Attachment D includes
the schedule of budget hearings. Residents are also encouraged to contact the Budget
and Research Department directly to provide input or ask questions about the budget.
More information on the budget and how to submit feedback directly to the City is
available at https://www.phoenix.gov/budget.



The remaining key dates in this year's budget process are as follows:

Date Event
May 5, 2026 City Manager's 2026-27 Proposed Budget
May 19, 2026 City Council Budget Decision
June 3, 2026 2026-27 Tentative Budget Ordinance Adoption
June 17, 2026 2026-27 Funding Plan and Final Budget Ordinance Adoption
July 1, 2026 2026-27 Property Tax Levy Ordinance Adoption

Responsible Department
This item is submitted by City Manager Ed Zuercher, Deputy City Manager Amber
Williamson and the Budget and Research Department.





ATTACHMENT A

2026-27

PROPOSED ADDITIONS
GENERAL FUND

View the Inventory of Programs published online for program details.

2026-27
Department/Program Total

Set-Asides

1. Current employee contracts expire at the end of the current fiscal year. $53,190,000
Management has been negotiating with each bargaining unit. Exact details of the
compensation packages, including ongoing and one-time costs, will be
determined in the negotiations process.

2. General Fund set-aside of one-time funds to be used to balance the projected FY $75,000,000
2027-28 budget.

3. General Fund set-aside of ongoing funds to support efforts to address childcare $5,000,000
affordability for Phoenix families.

Total Set-Asides $133,190,000

City Manager's Office
1. Office of Innovation $0
Convert a temporary full-time Administrative Assistant I position and a temporary 1.5
part-time Administrative Intern position to ongoing status. The Administrative
Assistant I maintains the City Manager’s Performance Dashboard and
Environmental, Social, and Governance Dashboard; leads Innovation Office‑
geographical information systems (GIS) initiatives; and supports coordination and
analysis for projects including the Chilled Drinking Water Initiative. The part time
Administrative Intern supports data collection and quality assurance for the City
Manager’s Performance Dashboard, the Valley Benchmark Cities Initiative, and
the Chilled Drinking Water Initiative, and produces and manages digital story
maps and infographics that connect the community to key projects through data.


Total City Manager's Office $0
1.5

Finance
1. Administration $0
Convert a temporary Finance Director position to ongoing status. The Finance 1.0
Director position will allow the Chief Financial Officer to focus on strategic
financial planning for the City. The Finance Director will manage department
operations and resources.




2026-27
Department/Program Total
2. Enterprise Resource Planning $0
Convert a temporary Management Assistant II position to ongoing status in the 1.0
Enterprise Resource Planning Division. The position is responsible for ensuring
the integrity and accuracy of contract data stored in the City’s procurement
system, including analyzing data, resolving discrepancies, and performing
technical tasks.

Total Finance $0
2.0

Fire
1. Fire Prevention Special Hazards $0
Add funding for 14 civilian positions to expand the Fire Special Hazards Unit to 14.0
meet operational demands driven by significant city growth and service needs.
The additions include two Fire Protection Engineers, two Fire Prevention
Supervisors, eight Fire Prevention Specialist II positions, one Engineering
Technician, and one Senior Engineering Technician. These positions are
essential to ensuring Fire Code compliance and providing timely plan reviews,
permit processing, and inspection services for facilities that store, handle, and
use hazardous materials, including Taiwan Semiconductor Manufacturing
Company and other large sites citywide. Increased revenue from Special Hazards
Assessment and Fire Prevention fees will fund these additions.

Total Fire $0
14.0

Housing
1. Housing Trust Fund $6,600,000
Add one-time funding to the Phoenix Housing Trust Fund, established by City 0.0
Council in May 2025 to further the City's commitment toward affordable housing.
This funding includes $2 million designated to waive or reduce plan review,
permit, and inspections fees for affordable housing or other designated projects;
$1 million to utilize an RFP to create pre-approved housing plans that would focus
on affordability and the character of the city's villages; and remaining funding to
be used in accordance with the Housing Trust Policy, as adopted by Council in
November 2025.

Total Housing $6,600,000
0.0

Human Resources
1. Organizational & Learning Development $0
Convert a temporary Management Services Administrator position to ongoing 1.0
status. This position manages the Organizational Learning and Multimedia
Division.




2026-27
Department/Program Total
2. Organizational & Learning Development $0
Convert a temporary Senior Business Systems Analyst position to ongoing status. 1.0
This position provides day-to-day technical and user support for PHXYou, the
City’s Learning Management System.

Total Human Resources $0
2.0

Human Services
1. Client Services $1,500,000
Add one-time funding to provide flexible financial assistance and refugee crisis 0.0
assistance aimed at preventing homelessness and stabilizing housing and food
security for low-income individuals and families. This request helps offset recent
reductions in federal funding and increased restrictions on federal safety net
programs. Financial assistance will be paired with coaching and case
management, including budgeting, benefits navigation, employment and
education linkages, and connection to community resources, with the goal of
providing both immediate household relief and strengthened long-term resilience.


2. Homeless Emergency Services $12,941,000
Add ongoing funding for the Office of Homeless Solutions (OHS) to support 0.0
ongoing operations of emergency shelters serving adults experiencing
homelessness in Phoenix. Additional resources are required due to the expiration
of ‑
American Rescue Plan Act (ARPA) funds, which OHS previously used to open
and operate several shelters citywide. This request includes support for
City owned facilities—such as the Safe Outdoor Space, the Phoenix Navigation
Center, and the Washington Shelter—as well as nonprofit-operated shelters,
including Rio Fresco, the North Mountain Healing Center, and the Central Arizona
Shelter Services (CASS) single adult shelter. These shelters combined serve
nearly 1,600 people nightly and more than 6,000 people annually.

3. Homeless Emergency Services $1,500,000
Add ongoing funding for the Office of Homeless Solutions to support the City’s 0.0
24/7 heat respite site and three extended hours cooling centers. These sites
serve more than 5,500 people each summer, providing cool, safe locations during
the summer heat. Eventual ongoing GF costs are anticipated to be $4 million;
however, opioid settlement funds are forecasted to be available to cover a portion
of these costs for the next several years.

4. Homeless Emergency Services $1,500,000
Add ongoing funding for the Office of Homeless Solutions to support the Keys to 0.0
Change Key Campus operations due to expiring American Rescue Plan Act
funding. Funds will be utilized for operations of the Brian Garcia Welcome Center,
janitorial services for the neighborhood around the Campus, and providing safe
and secure storage for client personal property. The Key Campus serves roughly
1,000 people daily.




2026-27
Department/Program Total
5. Homeless Housing Services $2,500,000
Add ongoing funding for the Office of Homeless Solutions to expand its housing 0.0
programming to include the master lease of 50+ units of rental housing that would
be sub-leased to people exiting homelessness. Third party leases will serve
single adults, couples and roommate situations with stable, affordable housing
with on-site support services.

Total Human Services $19,941,000
0.0

Information Technology Services
1. Various $0
Convert 16 temporary Information Technology positions to ongoing status, 16.0
including: one Information Tech Systems Specialist to help support protection,
backup and recovery of critical data; one Information Tech Systems Specialist for
overseeing the installation, maintenance, and repair of the City’s large-scale
communications network; eight positions supporting cyber-security and threat
analysis (four Information Technology Service Specialists, three Information
Technology System Specialists, and one Senior Information Technology Systems
Specialist), three positions supporting installation and maintenance of the City’s
cable and network telecommunication infrastructure (one Communications
Engineer, one GIS Coordinator, and one User Technology Specialist*U2); one
Lead User Technology Specialist for oversight of the Network Operations Center
(NOC) and monitoring of enterprise network and unified communications systems
to ensure security and optimal performance; one Contract Specialist II to support
legal and procedural compliance for contract procurement and administration;
and one Information Technology Specialist to keep City security policy, standards,
and procedures accurate, current, and properly documented. Converting these 16
positions to ongoing status and filling with City staff will help ensure continuity,
stability, and long-term support for these critical functions.


Total Information Technology Services $0
16.0

Law
1. Civil Division $0
Increase litigation staff to reduce reliance on contracted law firms. The cost of 5.0
contracted legal services has risen substantially in recent years, and transitioning
this work to City staff is expected to achieve meaningful and ongoing cost
savings. The three Assistant City Attorney IV positions, Legal Secretary*U8, and
Legal Assistant will be funded through the City's self-insurance trust.

Total Law $0
5.0




2026-27
Department/Program Total
Library
1. Branch Libraries $322,000
Add ongoing funding for the Cholla Library parking land lease. Due to ongoing 0.0
redevelopment of the former Metrocenter Mall, Cholla Library has experienced
reduced parking options for visitors. Funding will provide a dedicated lot that will
reduce congestion on nearby streets and neighboring business lots, improve
customer experience, and support the library’s role as a hub for learning, events,
and civic life.

Total Library $322,000
0.0

Office of Arts and Culture
1. Administration $0
Convert a part-time Administrative Assistant I position to an ongoing full-time 0.4
position. This position is the first contact point for customer service and supports
Arts and Culture programs by scheduling meetings, creating reports and
presentations, responding to constituent inquiries, and supporting the public art,
grants, and facilities teams.

Total Office of Arts and Culture $0
0.4

Parks and Recreation
1. Administration $500,000
Add ongoing funding to invest in teen prevention strategies, including tutoring 0.5
opportunities, enhanced and expanded recreation for youth and teens, and to
improve program affordability to ensure Phoenix families can participate in Parks
programs. This funding will implement tutoring opportunities at the Longview,
Maryvale, South Mountain, and Sunnyslope community centers; allow the South
Phoenix Youth Center to be open on Saturdays from 10 a.m. to 4 p.m., allowing
the center to be open six days a week; add enhanced programming and youth
and teen engagement at the Desert West, Longview, and Sunnyslope community
centers and the South Phoenix Youth Center; and improve affordability of select
youth and teen programs at the Laveen, Deer Valley, Desert West, Longview,
Maryvale, South Mountain, and Sunnyslope community centers.

2. Parks Maintenance $500,000
Add one-time funding for security lighting enhancements at City parks. This 0.0
funding will support renovations and additions to the existing LED lighting
infrastructure at five park locations. The improvements will increase visibility and
promote safe, enjoyable recreation opportunities for Phoenix residents by
providing enhanced playground lighting at Buffalo Ridge, Moon Valley, Sueno,
and Western Star Parks, as well as perimeter lighting around Hilaria Rodriguez
Park.




2026-27
Department/Program Total
3. Parks Maintenance $194,000
Add ongoing funding for one Groundskeeper and two Gardner positions, as well 3.0
as vehicles, equipment, and utilities to support operations of Lone Mountain Park.
Lone Mountain Park will be a 395-acre Community Park located at 56th Street
and Montgomery Road. Costs are anticipated to begin in April 2027. The full-year
ongoing cost, excluding initial equipment purchases, will be $379,764.


4. Recreation/Teen Centers Operated with City Staff $72,000
Add ongoing funding for one full-time Recreation Coordinator II, 2.5 FTE part-time 5.5
Recreation Leader, 1.0 FTE part-time Parks & Recreation Aide, and 1.0 FTE part-
time Recreation Instructor for the new recreation center at Esteban Park. This
project is part of the 2023 GO Bond program, and costs are anticipated to begin
in April 2027. The full-year ongoing cost will be $384,515.

5. Various $0
Convert a temporary Special Projects Administrator position to ongoing status. 1.0
This position was established to assist with a variety of high-level department and
capital projects in the Director’s Office and the Parks Development Division. The
position serves as the lead for the development of the department’s Parks Master
Plan, acts as the department grant liaison, and supervises the FitPHX program
manager.

Total Parks and Recreation $1,266,000
10.0

Planning and Development
1. Various $1,500,000
Add one-time funding for customer service enhancements in the Planning and 0.0
Development Department (PDD). Funding will support improvements to the
customer experience for visitors to PDD at Phoenix City Hall. In partnership with
the Public Works Department, PDD will identify opportunities to streamline and
improve the check-in process and overall customer flow. Potential improvements
include creating collaboration space, enhancing signage, and evaluating
alternative security and check-in procedures.

Additionally, funding will support continued customer service and process
improvement initiatives, which may include but are not limited to updating the
department’s website, developing strategies and educational materials on
available services and resources, and providing additional support for technology
upgrades.

Total Planning and Development $1,500,000
0.0




2026-27
Department/Program Total
Public Works
1. Equipment Maintenance Repair and Related Parts Service Support $0
Convert a temporary Equipment Shop Foreman position at the Salt River Service 1.0
Center to ongoing status. This position supervises the overnight shift, providing
24-hour, five-day-a-week operations making essential repairs to Solid Waste
vehicles and minimizing daily collection schedule disruptions.

2. Administration $0
Convert a temporary Senior Human Resources Analyst position to ongoing 1.0
status. The position provides human resources support, including guidance to
staff and management regarding performance management, employee relations,
training on HR-related topics, recruiting and selection processes, and grievances
for more than 1,100 employees in all Public Works divisions.

3. Facilities Management $0
Convert a temporary Administrative Assistant II position to ongoing status. The 1.0
position supports budget coordination for downtown buildings and service
centers; identifies and tracks potential grant opportunities; assists with property
management activities for new facilities; contributes to revisions of City building
standards in collaboration with subject matter experts; and serves as a liaison
with City departments and Police to support visitor management at Phoenix City
Hall and the Calvin C. Goode Building.

Total Public Works $0
3.0

Street Transportation
1. Street Lighting $500,000
Add one-time funding for the installation of 17 new streetlights and 24 streetlight 0.0
upgrades as part of the 27th Avenue Community Safety Plan, which leverages
technology and community-based resources to enhance safety and improve
quality of life along 27th Avenue and the I-17 corridor. These improvements will
increase visibility and support a safer environment for residents, businesses, and
visitors.

2. Central Records $0
Convert a temporary Chief Engineering Technician*U7 position to ongoing status. 1.0
This position serves internal and external customers, trains new employees,
researches to locate hard-to-find records, indexes documents, streamlines team
processes, and communicates with Subject Matter Experts to complete the
fulfillment of Public Records requests.

Total Street Transportation $500,000
1.0


TOTAL PROPOSED GENERAL FUND ADDITIONS $163,319,000
54.9




ATTACHMENT B

2026-27

PROPOSED ADDITIONS
NON-GENERAL FUND

View the Inventory of Programs published online for program details.

2026-27
Department/Program Total

Aviation
1. Terminal Technology Systems $118,000
Add ongoing funding to implement an access management system. This security 0.0
tool automates password management for high level system accounts, helping
meet Transportation Security Administration requirements and align with citywide
cybersecurity standards.

2. Terminal Management & Maintenance $295,000
Add ongoing funding for one Facilities Project Planner and two Building 3.0
Maintenance Worker positions to support water quality and safety operations at all
three -airports. The positions will ensure faster response times and support the
internal capacity needed to proactively implement and maintain the new airport
water quality program.

3. International & Common Use Systems $101,000
Add ongoing funding for one Aviation Supervisor II (Common Use Coordinator) 1.0
dedicated to international operations. Rapid growth in international air service
requires focused oversight to maintain safe, efficient passenger processing. This
position will manage passenger flow in international gate hold areas and support
federal inspections to ensure effective and timely movement of international
travelers.

4. Administration $487,000
Add ongoing funding for three positions to support administrative functions. The 3.0
addition of one Human Resources
- Analyst is needed to meet growing personnel
needs. The Program Manager and Management Assistant II will ensure a
successful rollout and long term stewardship of the new asset management
platform.

5. Capital Management & Support $190,000
Add ongoing funding for one Special Projects Administrator to support Operational 1.0
Readiness, Activation, and Transition (ORAT) activities for major capital projects.
This position will serve as the dedicated- ORAT lead within the Operations Division,
ensuring new facilities at Sky Harbor are operationally ready and improving
coordination and performance on large scale projects.

Total Aviation $1,191,000
8.0




2026-27
Department/Program Total

Finance
1. Risk Management $0
Convert a temporary Risk Management Program Manager position to ongoing 1.0
status in the Risk Management Division. The position supports the planning,
development, and oversight of the City’s commercial insurance programs, liability
claims
- management, and loss prevention initiatives. The position is funded by the
Water Services Department due to the increased volume and complexity of
risk related claims within that department.

2. Risk Management $0
Convert a temporary Claims Adjuster II position to ongoing status in the Risk 1.0
Management Division. The position responsibilities include essential administrative
and management support that directly contributes to service quality of aviation
claims activity. The position is funded by the Aviation Department due to the
increased volume and complexity of risk claims at the Deer Valley and Goodyear
airports.

Total Finance $0
2.0

Housing
1. Project Implementation $0
Convert a temporary Project Management Assistant to ongoing status. This 1.0
position supports the Wi-Fi Connectivity Program, which helps bridge the digital
divide for residents of City affordable and senior housing facilities, and provides
literacy training to empower residents to access education, healthcare, and
community resources. The position supports the program's initiatives by
collaborating with partners, fostering relationships, and securing new opportunities
and resources.

Total Housing $0
1.0

Phoenix Convention Center
1. Convention Center $0
Convert a temporary Senior User Technology Specialist position to ongoing status. 1.0
The position provides advanced technical support, resolves high level hardware
and software issues, coordinates with vendors, and assists with the evaluation,
installation, and maintenance of mission critical systems and applications. The
position also supports infrastructure planning with architects and external agencies
and helps staff integrate technology to improve operational efficiency.




2026-27
Department/Program Total
2. Convention Center $0
Convert a temporary User Technology Specialist position to ongoing status. The 1.0
position provides frontline technical assistance for networked systems,
applications, telecommunications, Wi-Fi, digital signage, AV equipment, and event-
related technology. The position also deploys computer devices, supports
temporary ticketing networks, and maintains accurate IT asset inventory.


3. Convention Center $0
Convert two temporary Project Management Assistant positions to ongoing status. 2.0
The positions coordinate cross-functional initiatives and contribute to strategic
planning for multimedia content, ranging from internal communications to public-
facing materials.

4. Convention Center $0
Convert a temporary Accountant II position to ongoing status. The position is 1.0
responsible for event settlements and financial reporting, compliance and
reconciliation. With sustained growth in the Phoenix Convention Centers events,
programs, and services, this position is essential in the financial operations to
balance the workloads and maintain financial accuracy and efficiency.


5. Convention Center $0
Convert a temporary Sales Manager position to ongoing status. The position is 1.0
essential for driving revenue, managing client relationships, and developing
strategic sales plans. The position supports marketing and client facing needs,
develops and executes marketing campaigns, creates promotional and social
media content, maintains website and email communications, coordinates events,
conducts market research, and collaborates with vendors to deliver effective
initiatives.

Total Phoenix Convention Center $0
6.0

Planning and Development
1. Civil Plan Review & Inspections $0
Convert 12 temporary positions to ongoing status to support the Taiwan 12.0
Semiconductor Manufacturing Company (TSMC) development project. Included
are one Electrical Plans Examiner II, Plan Review Coordinator, Mechanical Plans
Engineer, Fire Protection Engineer, Structural Plans Engineer, Electrical Plans
Engineer, Planning & Development Team Leader, Chief Engineering Tech*U7, two
Senior Engineering Tech, and two Planner II positions. The positions are needed to
fulfill obligations under the development agreement and ensure expedited, high-
quality support for plan review and permitting. These positions are critical to the
success of TSMC’s North Phoenix expansion and Phoenix’s economic growth.


Total Planning and Development $0
12.0




2026-27
Department/Program Total

Street Transportation
1. Administration $0
Convert a temporary Contracts Specialist II position to ongoing status. This 1.0
position supports, invoices, and reconciles the various revenue and expenditure
contracts in the department. This position also provides monthly training in the
City's procurement and financial system and ongoing shopper training throughout
the department.

2. Administration $0
Convert a temporary Senior Human Resources Analyst position to ongoing status. 1.0
This dedicated recruiter position supports position recruitments and interview
processes, and brings specialized expertise and proactive sourcing strategies, to
help to quickly fill vacancies.

Total Street Transportation $0
2.0

Water Services
1. Administration $0
Convert a temporary Senior Human Resources Analyst position to ongoing status. 1.0
This position collaborates with hiring managers to assess staffing needs, develop
advertising and outreach strategies, and draft tailored recruitment postings. It
reviews and approves selection process materials, supports interview and
selection steps, and provides career counseling to employees.


Total Water Services $0
1.0


TOTAL PROPOSED NON-GENERAL FUND ADDITIONS $1,191,000
32.0




ATTACHMENT C



B.R.D. NUMBER
BUDGET AND RESEARCH DEPARTMENT REPORT
2026-02
SUBJECT DATE ISSUED
General Fund Revenue Estimates March 24, 2026
This report provides General Fund (GF) revenue estimates to explain recommended revenue
projections. The City is committed to providing a transparent and open budget process. Providing this
information enhances the review and understanding of how revenue projections are developed to
better facilitate discussions during the annual budget development process.

Careful examination of revenue estimates is required to ensure projections are as accurate as
possible to maintain fiscal stability and long-term budget management. Predicting future revenue
growth is challenging and requires consistent and diligent analysis based on sound forecasting
principles and methods. Revenues are monitored closely, and an updated revenue report is prepared
and distributed to the City Manager’s Office, the City Council, and the community for review monthly.
GF revenues are comprised of several categories, all of which are unique and require separate
analysis. The primary revenue categories include local taxes and related fees, primary property taxes,
state shared sales, income and vehicle license taxes, and user fees and non-tax revenues.

This report explains how GF revenues are projected, including the data sources, economic
assumptions, and analytical methods used. It also provides historical revenue actuals and growth
rates, revenue estimates for 2025-26 and 2026-27, and the factors staff considered when analyzing
each major revenue category. Revenue estimates for Local Taxes reflect two major changes: the loss
of residential rental tax revenue due to Senate Bill 1131, effective January 1, 2025, and the 0.5
percentage point increase in the City TPT and Use Tax rates, effective July 1, 2025. Revenue
estimates for state-shared revenues reflect the negative impact of San Tan Valley's incorporation. In
addition, State-shared income tax revenue estimates reflect the negative impact of Senate Bill 1828,
which reduced the individual income tax rate to a 2.5% flat tax starting in tax year 2022. However, it
does not reflect any impact on State-Shared Revenue resulting from the 2026-27 State budget, nor
does it reflect any legislative changes that have recently been proposed or discussed during the
current legislative session.

The table below summarizes the estimated GF revenues and the primary reason for the variance:

GF Revenue Category 2025-26 2026-27 Amount Percent Primary Reason for Difference
(millions) Estimate Estimate Change Change
Local Taxes $820.0 $834.4 $14.4 1.8% Assume moderate growth
Increase in assessed property
Primary Property Tax 222.7 233.4 10.7 4.8%
valuation
State Shared Sales Tax 256.4 265.2 8.8 3.4% Assume moderate growth
State Shared Income Based on collections received
326.1 352.0 25.9 7.9%
Tax two years prior
State Shared Vehicle
90.4 93.4 3.0 3.3% Assume moderate growth
License Tax
Assume moderate growth in
User Fees & Non-Taxes 208.0 213.0 5.0 2.4% ambulance billings, partially
offset by lower interest earnings.
Total $1,923.6 $1,991.4 $67.8 3.5%
Revenue Projections & Trusted Sources

Projecting revenues involves complex analysis and continuous monitoring to identify variances and
recommend adjustments so that expenditures do not exceed available resources and a balanced
budget can be maintained. As part of the overall forecasting process, assumptions about the direction
and strength of the national, state, and local economy are considered along with indicators such as
population, job growth, and personal income. Information on program and service activity levels,
rates, and fees that influence certain revenues is evaluated, and proposed legislation is monitored to
determine potential impacts to revenue categories such as sales taxes, state shared revenues,
emergency transportation service revenues, and property taxes.

In addition, information from City departments on user fees and non-tax revenue is requested and
analyzed each year as part of the technical budget review process. Finally, trusted economic and
financial sources are relied on to provide certain revenue projections and insight into the overall
direction and strength of the economy and include experts from the State’s Finance Advisory
Committee (FAC), Joint Legislative Budget Committee (JLBC), Arizona State University, University of
Arizona (UofA) Economic and Business Research Center (EBRC), Arizona Department of Revenue,
National Blue Chip, Western Blue Chip, and the U.S. Bureau of Labor Statistics and Bureau of
Economic Analysis.

The City is also a member of the Forecasting Project through the EBRC at the UofA. This project is a
community-sponsored research program providing project members with economic forecasts for
Arizona and the Phoenix-Mesa metro area. Budget & Research (B&R) staff attend quarterly
meetings, participate in discussions with other local government and private enterprise members, and
receive quarterly economic reports. In the fall of 2014, Budget and Research consulted with the
UofA’s Eller College of Management/EBRC to enhance the City’s sales tax revenue forecasting
process. Dr. George Hammond, EBRC Director, and Dr. Alberta Charney, Senior Research
Economist, spent several months working with City staff to develop an enhanced econometric sales
tax forecasting model for all categories of city and state sales taxes. In the summer of 2017, staff
worked with EBRC to update the tax forecasting model. In March 2021, the EBRC revised the City’s
model again by including online sales tax. The EBRC leads the State of Arizona Forecasting Project,
which provides in-depth economic forecast analysis and databases on a subscription basis to
businesses, organizations, and government via membership. The additional consulting with Dr.
Hammond has provided the City with solid, independent economic and statistical expertise used to
develop a statistically valid forecasting model specifically for the City of Phoenix. The projected
growth rates in each sales tax category for the 2026-27 estimate and subsequent years of the
forecast are based on projections developed with the enhanced econometric forecasting model.

Economic Assumptions

Several of the primary revenue categories are influenced by the economy, and the sources mentioned
above provide valuable information on expected economic growth. These sources are used in
developing projected revenue growth rates. B&R staff continuously monitor economic variables and
what these experts are predicting when developing revenue estimations.

By the end of 2025, the U.S. economy displayed both resilience and underlying challenges. Real gross
domestic product (GDP) increased at an annual rate of 4.4% in the third quarter of 2025, according to
the updated estimate from the U.S. Bureau of Economic Analysis. The increase in real GDP reflected
increases in consumer spending, exports, government spending, and investment. Still, the road in
2026 remains challenging. The Blue Chip Economic Indicators (BCEI) consensus projects that real
GDP will grow at a slower pace, with 2.0% in 2026 and 2.1% in 2027. Forecasters anticipate continued
consumer spending support, though at a slower pace. Persistent uncertainties – including tariff policy
shifts, escalating geopolitical tensions, elevated consumer debt, housing affordability constraints, labor
market frictions, and inflationary pressures continue to weigh on confidence and investment decisions.

Arizona’s future economic performance, along with that of Phoenix, will be closely tied to national and
global trends. Arizona’s economy continues to grow, though at a slower pace than usual. Job gains
are modest due to reduced hiring and slightly higher layoffs. Arizona’s nonfarm job growth has
decelerated, shifting from roughly 1.2% in 2024 to 0.6% in 2025, according to the U.S. Bureau of
Labor Statistics (BLS). Income levels are rising gradually, reflecting post-pandemic normalization in
employment costs. For the 12-month period ending September 2025, wages and salaries for private
industry workers increased 2.6% in the Phoenix Metropolitan Area, down from 3.4% in September
2024.

Despite these challenges, Arizona taxable retail sales, including remote sellers, increased by 4.3% in
December 2025. The rebound in taxable retail sales demonstrates resilient consumer activity.
However, December 2025 marked the fifth consecutive month with a year-over-year decline in State
TPT contracting revenue, primarily due to weakness in the residential construction sector. After the
COVID-19 pandemic, Arizona saw a surge in home and rent prices. Housing affordability has
remained a primary challenge for the state. Housing permit activity statewide has been weak through
the first eight months of 2025; seasonally adjusted total Arizona housing permits were down 13.1%
compared to the same period last year (EBRC Benchmark).

Revenue Forecasting Methods

Several forecasting methods and practices are used to estimate City revenues, and these vary by
revenue type. Evaluating historical growth patterns and current actuals is an important component of
analysis and provides insight into the direction of the various revenue categories and the growth
needed to achieve estimated revenues. Information is also collected from the economic sources
mentioned earlier to ensure the current and subsequent year’s estimates are reasonable and in line
with what these experts are predicting. The State FAC provides valuable information from a panel of
respected economists and financial professionals. Included in their materials are projections of state
sales tax and income tax collections. These projections are considered when developing city sales tax
and state shared sales and income tax revenues for both the current and subsequent fiscal years.
Additionally, information is collected from City departments during the annual technical review process
to analyze the user fee and non-tax revenue category. The department’s knowledge of the revenues
generated by various City programs and services is essential to developing accurate projections. Staff
also considers one-time revenues, adjustments, and contractual agreements impacting growth when
developing estimates.

In conjunction with considering historical growth, current trends, and information from trusted sources
and departments, B&R staff uses several forecasting methods when preparing the estimates. The
most common methods of revenue estimation used are averages of actual revenue experience by
varying periods, annualization of year-to-date actuals, and most often a percentage of prior year
method. This last method involves analyzing the amount of revenue collected at a point in
time during prior fiscal years, for example, the 7-month actuals represented a certain percentage of
the total collections for the entire fiscal year and then applying it to current year-to-date actuals. This
method accounts for the seasonal nature of many City revenues and is often a more effective method
than using an average or annualizing approach. Additionally, the growth rate needed to reach the
budgeted or estimated revenue is considered. If the percentage growth needed for the remaining
months of the fiscal year is substantially higher or lower than the current growth rate, adjustments are
made to arrive at a new estimated revenue amount for the fiscal year.


Once the current fiscal year estimate is developed, assumed growth rates are then applied to this
amount to arrive at a projected revenue amount for the following fiscal year. These assumed growth
rates take into account historical and recent revenue trends, one-time revenue adjustments, and
information from City departments and our trusted sources to ensure projections are neither overly
conservative nor aggressive.

Finally, as part of the annual budget development process each year, revenue estimates are
presented to the City Manager’s Office, the City Council, and the community as part of the GF Multi-
Year Forecast, the proposed Trial Budget, and the City Manager’s Budget recommended for
consideration and approval prior to final budget adoption in June.

General Fund Revenue

To assist in explaining the basis for how GF revenue is estimated for each of the major categories,
historical revenue growth and estimated revenues for the 2025-26 and 2026-27 are provided
graphically, along with a description of the revenue category and the methodology used to develop
recommended revenue estimates beginning with total GF revenue.

Total General Fund Revenue


Actual & Estimated General Fund Revenue $ % Change
13% $1,991
200.0




13% $1,905 $1,924 20
%




10% 8% $1,846
00.0

6% 4% $1,693
%




3% 3% 4% 4%
00.0


$1,496 0%




00.0
$1,379 -3%
$1,221 $1,259 -10%




$1,173

$ Millions
00.0

$1,106
-20%




100.0




-30%




80.0




-40%



60.0




-50%

40.0




20.0 -60%




* Projections for 2025-26 and 2026-27 include the 0.5 percentage point increase in the City TPT and Use Tax rates, effective
July 1, 2025. They also reflect the negative impact on state-shared revenues from the incorporation of San Tan Valley in 2025-26


As mentioned, GF revenue consists of local taxes and related fees, primary property taxes, state
shared sales, income and vehicle license taxes, user fees, and non-tax revenues. Estimating
revenues for each category is conducted separately to predict the revenues for the current and
following fiscal year more accurately. Each category is unique with respect to the variables that
comprise the revenue and influence growth. Variables that impact revenue growth include
economic factors such as inflation, consumer sentiment, discretionary income, population,
unemployment, job growth and construction activity. Other influencing factors may include
legislative action, City Council policy directives, legal restrictions and mandates, state statutory
formulas, program enhancements or reductions, and changes in rates and fees. For these
reasons, evaluating each major category separately is preferred and generates more accurate
revenue projections.

Local Taxes and Related Fees, 41% of Total General Fund Revenue

13%
Actual & Estimated Revenue $ % Change
$820 $834 30
%




80.0



16% 5% 0%
7% 20
%




12% $730 $729
8% $697
3%
%




2%
70.0




1% $650
2% 0%




$ Millions
$559
60.0




-10%




$490 $501
50.0




$441 $453 -20%




-30%


40.0




-40%




30.0




-50%




20.0 -60%




Local taxes and related fees consist of city sales taxes, privilege license fees, and other excise taxes.
The majority of revenue is derived from city sales taxes, which are comprised of 15 general
categories collected based on a percentage of business income accruing in each category. The table
on the following page provides the local sales tax rates by category and the percentage allocated to
each fund. The table reflects the 0.5 percentage point increase in the TPT and Use Tax rates, raising
them from 2.3% to 2.8%, effective July 1, 2025.

Privilege license fees are assessed to recover the costs associated with administering the local tax
system. Other excise taxes include the jail tax and the excise tax collected on water service
accounts, which provide resources to help offset jail costs paid to Maricopa County and other GF
services.

Projections provided by the UofA were used to develop city sales tax estimates. Staff analyzes
historical and recent trends in sales tax data by category, evaluates cumulative growth and uses an
econometric forecasting model constructed by the UofA to develop projections. Estimates provided
by the FAC and JLBC are also considered to ensure projections are reasonable and not overly
aggressive or conservative in nature. Sales tax can be volatile and typically correlates to the local
economy and consumer spending behavior. Increases in sales tax collections are expected when the
local economy expands, driven by underlying fundamentals such as population growth, increases in
discretionary income, business expansion, job growth, and real estate growth. The opposite holds
true during times of economic contraction or recession as evidenced in 2008-09 and 2009-10 during
the Great Recession, and most recently during the COVID-19 pandemic. The federal stimulus
assistance provided during the pandemic and more than expected revenue collections from retail and
contracting sales taxes offset the revenue loss in the hospitality and leisure sales tax categories,
which prevented a severe decline in City revenues. Additionally, the recent surge in inflation has
positively impacted City revenues by drawing in greater tax revenue from higher-priced taxable goods
and a rise in wages. However, the retail sector, the City’s largest source of sales tax, has slowed
since June 2022. In 2023-24, retail sales tax grew by 3.1%, the slowest rate since 2012-13, and in
2024-25, growth was even more modest at 1.1%. This slowdown, combined with recent legislative
changes, has negatively impacted city sales tax revenue collections. The negative impacts include
the State's elimination of the residential rental sales tax under Senate Bill (SB) 1131. Significant
economic uncertainty and volatility in sales tax revenue collections in the first seven months of 2025-
26 require a cautious approach to forecasting. Staff is closely monitoring revenue collections and
may revise revenue estimates as more information becomes available.

Privilege license fees and other excise tax projections are developed using the existing fee
structures, historical trends, averages, recent collection experience, and the percent of prior year
method to account for seasonal influences on revenue activity. Privilege license fees and other
excise taxes assume modest growth and continuation of current year-to-date experience.

Local Sales Tax Rates by Category

Public Public Parks
N’hood Safety Safety & Transp. Conv. Sports Capital
GF Protection Expansion Enhance. Pres. 2050*** Center Fac. Const. Total
Advertising – – – – – – 0.5% – – 0.5%

Contracting***** 0.9% 0.1% 0.2% – 0.1% 0.9% 0.6% – – 2.8%

Job Printing***** 0.9% 0.1% 0.2% – 0.1% 0.9% 0.6% – – 2.8%

Publishing***** 0.9% 0.1% 0.2% – 0.1% 0.9% 0.6% – – 2.8%

Transportation/Towing***** 0.9% 0.1% 0.2% – 0.1% 0.9% 0.6% – – 2.8%

Restaurants/Bars***** 0.9% 0.1% 0.2% – 0.1% 0.9% 0.6% – – 2.8%

Leases/Rentals/ 1.5% 0.1% 0.2% – 0.1% 0.9% – – – 2.8%
Personal Property*****
Short-Term Motor 1.5% 0.1% 0.2% – 0.1% 0.9% – 2.0% – 4.8%
Vehicle Rental*****
Commercial Rentals***** 1.6% 0.1% 0.2% – 0.1% 0.9% – – – 2.9%

Lodging Rentals 1.5% 0.1% 0.2% – 0.1% 0.9% 2.0% 1.0% – 5.8%
Under 30 Days*****
Lodging Rentals – – – – – – – – – –
30 Days and Over******
Retail (Level 1 – amounts 1.5% 0.1% 0.2% – 0.1% 0.9% – – – 2.8%
= < $14,338 for a single
item) **** & *****
Retail (Level 2 – amounts 1.2% 0.1% 0.2% – 0.1% 0.4% – – – 2.0%
> $14,338 for a single
item) ****


Public Public Parks
N’hood Safety Safety & Transp. Conv. Sports Capital
GF Protection Expansion Enhance. Pres. 2050*** Center Fac. Const. Total

Amusements***** 1.5% 0.1% 0.2% – 0.1% 0.9% – – – 2.8%

Utilities 2.7%* – – 2.0%** – – – – – 4.7%

Telecommunications 2.7% – – – – – – – 2.0% 4.7%



*The General Fund portion of the utilities category includes the 2.7% franchise fee paid by utilities with a franchise agreement.
**The Public Safety Enhancement designated 2.0% sales tax applies only to those utilities with a franchise agreement.
****Proposition 104 also established a two-tier tax rate structure applicable to retail sales of single items in excess of $10,000, to be
adjusted biennially for inflation. Effective January 1, 2018, the first $10,303 (Level 1) is subject to the 2.3% tax rate, while transactions
over $10,303 (Level 2) are subject to the 2.0% tax rate. The criteria for Level 1 and Level 2 were adjusted on January 1, 2026, and the
current threshold is $14,338, which will be adjusted again on January 1, 2028.
*****The tax rates reflect the 0.5 percentage point increase, from 2.3% to 2.8%, effective July 1, 2025. The rounded tax rates for each
fund are provided for demonstration purposes, with the specific percentages used in the actual allocation.
******SB 1131 prohibits municipalities from taxing residential rental property starting January 1, 2025.


Primary Property Tax, 12% of Total General Fund Revenue


Actual & Estimated Revenue $ % Change 4% 5%
3% 3% $233 20%




230 .0 5% $223
6% 5% 5% 7% 6% $214
3% $206
10%




210 .0


$201

$ Millions
$192 0%




190 .0 $182
$170
$162
-10%




$155
170 .0




150 .0
$146 -20%




-30%



130 .0




-40%


110 .0




-50%

90. 0




-60%
70. 0




50. 0 -70%




Arizona property tax law provides two separate tax systems. A primary property tax is levied to pay
current operations and maintenance expenses. Therefore, primary property tax revenue is budgeted
and accounted for in the GF (and is illustrated in the above graph). A secondary property
tax levy is restricted to the payment of debt service on voter-approved long-term general obligation
debt. Therefore, the secondary property tax revenue is budgeted and accounted for as a special
revenue fund. The primary property tax levy forecast reflected here is based on the net assessed

value stated in the annual “Levy Limit Worksheet” for the City of Phoenix, issued by the Maricopa
County Assessor, multiplied by the projected primary property tax rate. The primary property tax
revenue forecast assumes that 99% of the projected primary property tax levy is actually collected.
The annual amount of the primary property tax levy is limited by the Arizona Constitution to a two
percent increase over the prior year levy limit plus an estimated levy for previously unassessed
property (primarily new construction). Provisions in Chapter XVIII of the City Charter limit the City’s
primary property tax rate to $1.00 per $100 of assessed valuation with the exception of costs to
operate library services. The proposed 2026-27 primary property tax rate, not including the portion of
the rate allocated to cover the Library Department operating costs, is $1.00 per $100 of assessed
valuation. The proposed primary property tax rate for 2026-27 of $1.2652 is lower than the 2025-26
primary property tax rate of $1.2658 and is equal to the rate allowable under the state constitution,
which limits the primary property tax to an amount 2% greater than the prior-year limit on previously
taxed properties. The primary property tax revenue estimate for 2026-27 is $233.4M, which is
$10.7M, or 4.8%, more than the 2025-26 revenue estimate of $222.7M due to increased taxable net
assessed valuation (property values) and new construction.

State Shared Sales Tax, 13% of Total General Fund Revenue


Actual & Estimated Revenue $ % Change 2% 1% 3%
3%
$265
20%




5% $250 $254 $256
5% 8%
250 .0
6% 4% 17% 14% $242 10%




$230 0%




$201

$ Millions
-10%


200 .0




$172
$165 -20%




$156
150 .0
$144 -30%




-40%




-50%
100 .0




-60%




50. 0 -70%




State sales tax revenues received by the City are governed by Arizona State Statute §42-5029. State
sales tax revenues are split between a “distribution base”, of which Phoenix receives a share, and a
“combined non-shared” category, which is allocated entirely to the state. With the exception of some
tax categories, the distribution base consists of either 20, 32, 40, or 50 percent of collections,
depending on the tax category. State statute §42-5029 stipulates that, of the monies designated in
the distribution base, the Arizona Department of Revenue shall pay 25% to incorporated cities on the
basis of relative population percentages. The population share changes annually based on Census
Bureau Population Estimates. For 2026-27, the City of Phoenix population share is projected to be
27.07%, based on the 2024 Census Bureau Population Estimates. This estimated share also reflects
the reduced share resulting from the incorporation of San Tan Valley in 2025-26.

State sales tax is estimated to be similar to the city sales tax forecast. Staff analyzes historical and
recent trends in sales tax data by category and evaluates cumulative growth when developing
revised estimates. Projections provided by the UofA EBRC, using an econometric sales tax model,
were used to develop 2026-27 estimates, and information from the FAC and JLBC was considered to
ensure current fiscal year estimates are reasonable and in line with what these experts are
projecting.

State Shared Income Tax, 18% of Total General Fund Revenue


Actual & Estimated Revenue $ % Change
50.0




41%
$436 45
0.0




44%
8%
40.0




$351 $352
10% 12%
0.0




9% $326

$ Millions
5% $308
-2% -11% 30.0




$240
$215
0.0




-7%
$200 $197 $213
$191 20.0




-19%
0.0




10.0




.0




0.0




State shared income tax revenue, also known as the Urban Revenue Sharing (URS) Fund, was
established by voter initiative in 1972 and is governed by Arizona Revised Statute §43-206. The
statute stipulates that 15% of the net proceeds of state individual and corporate income tax collected
two years preceding the current fiscal year be distributed to incorporated cities and towns. Laws
2021, Chapter 412 (Tax Omnibus) increased the Urban Revenue Sharing distribution from 15% to
18% starting in 2023-24. Individual cities receive their portion based on the cities’ share of the state
population. The 2026-27 City of Phoenix population share is estimated at 27.03% and is based on the
2024 Census Bureau Population Estimate. This rate will change annually based on Census Bureau
Population Estimates. As a result of the initiative, Arizona Revised Statute §43-201 stipulates that the
area of income taxation is preempted by the state, and a county, city, town, or other political
subdivision shall not levy income tax as long as the Urban Revenue Sharing Fund is maintained as
provided in state statute §43-206. The estimated share of 27.03% also reflects the reduced share
resulting from San Tan Valley's incorporation in 2025-26.


Since state shared income tax revenue is based on actual collections from two years preceding the
current fiscal year, the 2025-26 and 2026-27 projected revenue is known and is based on actual
collections received in 2023-24 and 2024-25, respectively. The declines of (19.4) % in 2024-25 and
(7.0) % in 2025-26 are primarily due to significantly lower state shared income tax collections
following the State’s implementation of a flat individual income tax. Senate Bill 1828 reduced
individual income tax rates beginning in tax year 2022 to the current flat tax rate of 2.5%. The
projected 7.9% growth in 2026-27 reflects anticipated capital gains growth in tax year 2024 and
continued strong wage growth.

State Shared Vehicle License Tax, 5% of Total General Fund Revenue


3%
Actual & Estimated Revenue $ % Change 3%
5% $93
13% 4% $90
90. 0



2% $88
$80 -1% 20%




8% 8% $81 $84
5% $79
80. 0
3% 0%
$70
0%




$71
70. 0

$67


$ Millions
$62
$60 -20%


60. 0




50. 0




-40%




40. 0




-60%




30. 0




20. 0 -80%




State shared vehicle license tax has been distributed to cities and towns since 1941. The tax is levied
per $100 of a vehicle’s assessed value. For the first 12 months of the vehicle’s life, the assessed
value is 60% of the manufacturer’s base retail price. For each subsequent year, the assessed value
is 16.25% less than the previous year. The rate per $100 of assessed value is $2.80 for new vehicles
and $2.89 for renewals. The Arizona Department of Transportation (ADOT) collects and distributes
the tax according to Arizona Revised Statute §28-5808. The distribution to individual cities is based
on their relative population within the county. The City of Phoenix population share for 2026-27 is
estimated at 38.03%, based on the 2024 Census Bureau Population Estimate. This percentage will
be updated annually as new Census Bureau Population Estimates are released.

Vehicle License Tax (VLT) revenues are often correlated to the overall strength of the economy.
Similar to sales tax revenues, this revenue category tends to grow during economic expansion, as
illustrated in the graph above. Revenues are estimated by evaluating historical growth patterns, year-
to-date cumulative growth, and applying the percentage of prior year method to year-to-date actuals,
which accounts for the seasonality in collections. Staff also consider projections provided by ADOT,
which are published annually for this revenue source, and any available recent economic information
pertaining to projections on the local economy and vehicle sales when formulating recommended
current and subsequent year estimates. The projected growth rate for 2026-27 is 3.3%, assuming
moderate growth based on the ADOT forecast from September 2025.

User Fees and Non-Tax Revenues, 11% of Total General Fund Revenue

22% 6%
Actual & Estimated Revenue $ % Change
$211 $208 $213
24%
220 .0




199.6
16%
30%




-4% -5% 13%
-2% $164
-11%
170 .0 10%




$142 $137 $131 $132 -1% 2%
$117

$ Millions
$122 -10%




120 .0




-30%




70. 0 -50%




-70%




20. 0




-90%




-30.0 -110%




User Fees and Non-Tax Revenues include collections from licenses and permits, fines and
forfeitures, cable television fees, and user fees from several City departments designed to recover
the costs of providing specific City services, including Parks and Recreation, Library, Planning,
Police, Fire, and Streets. They also include other revenue sources, such as interest income, parking
meter revenue, in-lieu property taxes, sales of surplus property, various rental income, parking
garage revenues and concessions, and miscellaneous service charges in Finance, Housing, Human
Services and Neighborhood Services.

B&R staff relies on departments to provide essential information concerning activity levels, fee
increases or decreases, and program changes that impact the variety of revenue sources in this
category. Technical revenue reviews are conducted twice each fiscal year as part of the annual
budget development process. Departments are asked to provide revenue estimates and the reasons
for any changes from prior-year actuals. Staff conducts a line-item analysis of all revenues and uses
various methods, including annualization and percentage of prior year, as well as consideration of
one-time and contractual revenues, program enhancements or reductions, and other adjustments
when developing estimates.

The projected 2.4% growth in 2026-27 was driven primarily by the fee increase for hazardous
materials inspections and moderate growth in emergency transportation services, partially offset by
declines in interest earnings and cable communications revenue.


In addition to the technical reviews conducted twice each fiscal year, B&R staff monitors revenues
monthly to determine if adjustments to projections are needed. The proposed estimates are then
reviewed by B&R management and the City Manager and finally incorporated into the GF proposed
revenue projections for consideration by the City Council and the community.

This report is for informational purposes only and is intended to provide the City Council and the
community with explanations on how GF revenues are analyzed and developed to better facilitate
discussions during the annual budget development process.

Yung Pham
Yung Pham
Principal Budget and Research Analyst




Attachment D

2026-27 Community Budget Hearings
Council
Date Time District(s) Location
Goelet A. Beuf Community Center
Monday, March 30, 2026 6:00 pm D1 Multipurpose
3435 W. Pinnacle Peak Road
Steele Indian School Park
Wednesday, April 1, 2026 6:00 pm D4 Memorial Hall
300 E. Indian School Road
Maryvale Community Center
Thursday, April 2, 2026 6:00 pm D5 Multipurpose
4420 N. 51st Avenue
Devonshire Senior Center
Monday, April 6, 2026 8:30 am D6 Multipurpose
2802 E. Devonshire Avenue
Desert West Community Center
Monday, April 6, 2026 6:00 pm D7 Multipurpose
6501 W. Virginia Avenue
Spanish Language Maryvale Community Center
Tuesday, April 7, 2026 6:00 pm (English interpretation Multipurpose
available) 4420 N. 51st Avenue
Sunnyslope Community Center
Thursday, April 9, 2026 8:30 am D3 Multipurpose
802 E. Vogel Avenue
Spanish Language South Mountain Community Center
Thursday, April 9, 2026 6:00 pm (English interpretation Century Room
available) 212 E. Alta Vista Road
Communitywide City Council Chambers
Saturday, April 11, 2026 10:30 am Bilingual Hybrid 200 W. Jefferson Street
(virtual/in-person) www.phoenix.gov/budget/hearings
Paradise Valley Community Center
Monday, April 13, 2026 6:00 pm D2/D3 Multipurpose
17402 N. 40th Street
South Mountain Community Library
Wednesday, April 15, 2026 6:00 pm D8
7050 S. 24th Street
Communitywide City Council Chambers
Thursday, April 16, 2026 6:00 pm Hybrid 200 W. Jefferson Street
(virtual/in-person) www.phoenix.gov/budget/hearings




Attachment E





FIscal Year 2026-31 Preliminary Five-Year Capital Improvement Program

This report transmits the Preliminary Five-Year Capital Improvement Program (CIP) for
information and discussion. The City Charter requires the City Manager to submit the
Preliminary CIP prior to adoption of the final budget.

The CIP represents investments in the long-term needs of the community through
infrastructure development and maintenance. The five-year program totals $11.4
billion, with a $2.7 billion program for 2026-27. The full report is available on the
Budget and Research website at phoenix.gov/budget.

THIS ITEM IS FOR INFORMATION AND DISCUSSION.

Summary
The five-year Preliminary CIP presented totals $11.4 billion. The first year of the
program, totaling $2.7 billion, will ultimately be updated for carryover and resource
availability and presented to the City Council for appropriation. The remainder of the
CIP is presented for responsible planning purposes and is dependent upon resource
availability.

Sources of five-year Preliminary CIP funding include $186.6 million in General Funds,
$2,634.3 million in Special Revenue Funds, $3,422.5 million in Enterprise Funds,
$273.4 million in General Obligation Bond Funds, $2,094.1 million in Other Bond
Funds, and $2,817.3 million in Other Capital Funds.

The Preliminary CIP reflects the $500 million voter approved 2023 General Obligation
Bond Program, less expenditures projected through the current 2025-26 fiscal year.
Projects and funding distribution are consistent with the General Obligation Bond
Executive Committee recommendations presented to, and adopted by, the City
Council in December 2022. $250 million in General Obligation bonds have been sold,
and the remaining $250 million is anticipated to be sold this calendar year. Schedule 7
of the Preliminary CIP document provides the allocation of funds by project and fiscal
year. As the program progresses and costs are finalized, this schedule will capture any
proposed funding reallocations in comparison to the original approved program;
however, all allocations currently match the original Council-approved allocations.




The proposed program's $186.6 million in General Funds and $192.7 million in
General Fund-backed excise tax bonds reflect a commitment to infrastructure and
technology investment.

Substantial investments funded directly though General Funds include:
• $111.1 million in Facilities Management for facility major maintenance and
assessments
• $31.9 million in Information Technology for enterprise applications and network
infrastructure
• $28.9 million in Street Transportation and Drainage for flood hazard mitigation, cool
pavement, and Roadway Safety Action Program projects
• $2.9 million in Municipal Court for Case Management System replacement
• $5.0 million in Sustainability for energy and water efficiency projects

Notable projects to be funded with excise tax bond proceeds include:
• $82.7 million in Fire for new fire stations, new and replacement fire apparatus, and
the Fire Computer Aided Dispatch System replacement
• $48.6 million in Information Technology for enterprise asset management and public
safety radio replacements
• $25.0 million in Economic Development for the Innovation 27 advanced education
and workforce development facility
• $19.2 million in Facilities Management for security access control system
replacement

The nearly 1,000 projects within the Preliminary Capital Improvement Program are
detailed on the Budget and Research website at phoenix.gov/budget. A summary of
sources, uses, and project selection methods by program is provided below.

Arts and Cultural Facilities

The Arts and Cultural Facilities program totals $25.5 million and is funded by General
Obligation Bond funds.

Projects are typically prioritized based on community input obtained during the
development of periodic General Obligation Bond programs.

The program provides funding for construction, renovation and expansion of arts and
cultural facilities operated primarily by non-profit partner entities.

Aviation



The Aviation program totals $2,100.0 million and is funded by Aviation, Aviation Bond,
Capital Grant, Customer Facility Charge, and Passenger Facility Charge funds.

The Aviation program includes improvements at Phoenix Sky Harbor International,
Phoenix Deer Valley and Phoenix Goodyear Airports.

Various divisions of the Aviation Department are responsible for identifying and
requesting new CIP projects as they are needed for airport expansion and
replacement of existing infrastructure. They work with stakeholders to determine the
impact of a project and, where necessary, to develop a business case which includes a
scope, schedule, and budget, including a return-on-investment analysis, for the
project. As part of the business case, a points-based score is developed for the
project. Scoring is based on the project’s return-on-investment, cost reduction or net
present value; efficiency or productivity improvements; impact on the airport’s
sustainability goals; regulatory mandates; safety and security risk mitigation; and level
of service or community relations needs. The business case is then presented to
Aviation’s executive team for approval or revision. If approval is received, the project
awaits available funding and incorporation into the Aviation CIP.

Major projects include:
• Construction of new Terminal 3 North 2 apron construction of new Crossfield Taxiway
U
• Strengthening and reconstruction of Taxiway A (A3-A4)
• Construction of Terminal 3 North 2 Concourse
• Repair and upgrade of Terminal 3 Processor and Baggage Handling System
• Construction of the Facility & Services Tonto Lot Campus Phase 1
• Repair and replacement of Terminal 4 vertical and horizontal transportation
• Repair and replacement of Terminal 4 Central Plant
• Replacement of Rental Car Center fire alarm system and vertical transportation
• Reconstruction and strengthening of Phoenix Deer Valley Airport Runway 7R/25L

Economic Development

The $78.6 million Economic Development program is funded by Downtown Community
Reinvestment, Operating Grant, Other Restricted, Sports Facilities, 2023 General
Obligation Bond, and Other Bond funds.

The Community and Economic Development Department identifies new CIP projects
by various methods which include: alignment with strategic planning objectives;
collaboration with business, government and educational partners; and, engagement


with community groups and business associations. The City commits funds and
expertise to partner with private and public entities. These partnerships help to expand
the City’s economy through the creation of new infrastructure and civic improvements,
that trigger regional revitalization, enhance public tax revenues, facilitate the growth of
the knowledge workforce, and promote higher education opportunities. Other benefits
include achieving affordable and workforce housing objectives, and support of historic
preservation and adaptive reuse projects.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the

Major projects include:
• Downtown Redevelopment Area project facilitation and assistance
• Workforce Training Facility
• ASU Health Technology Center development assistance
• ASU Thunderbird School of Global Management development assistance
• Historic Preservation and Conservation facilitation and assistance
• Arizona Biomedical Corridor project facilitation and assistance

Environmental Programs

The $2.4 million Environmental Programs CIP is funded by Other Restricted and 2023
General Obligation Bond funds. The program facilitates eligible citywide general
stormwater compliance and brownfields redevelopment projects.

Stormwater capital improvement projects are implemented to advance the City’s efforts
to comply with stormwater management requirements and regulations. Any City
department may propose a potential stormwater project, provided that the project
meets the criteria outlined in the Stormwater Capital Improvement Project Fund
Eligibility and Funding Protocol. The proposed projects are reviewed by the
Stormwater Working Group and then the requesting department presents for approval
to the Stormwater Executive Committee based on criteria established in the funding
protocol, including: risk of regulatory non-compliance, ability for the project to achieve
sustained compliance, degradation to the City’s Municipal Separate Storm Sewer
System, need for remediation, and other associated risks.

Redevelopment of brownfields property results in the elimination of environmental
exposures and reuse that can eliminate blight, increase community benefits, jobs, and
often serves as a catalyst for revitalization of the area. City brownfields project funding
will assist City departments with predevelopment costs associated with


environmentally contaminated properties, such as environmental assessments,
asbestos/lead-based paint surveys and abatement, and remediation. Project selection
is based on several factors including location, benefit to community and job creation.
Additionally, brownfields funding for the Rio Reimagined Land Acquisition program
may include environmental assessments and cleanup to prepare economically
attractive sites along the Rio Salado.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the

Facilities Management

The Facilities Management program totals $143.2 million and is funded by General,
Other Restricted, 2023 General Obligation Bond, Other Bond and Other Capital funds.

The Facilities Management program includes various major maintenance projects for
City facilities and fuel infrastructure. Additional citywide efforts to be implemented by
Facilities Management primarily include: security access control, Glenrosa Fleet
Building, energy efficient retrofits, fire and life safety systems, HVAC systems, roofs,
parking lots, fuel/oil tanks, plumbing, generators, and electrical systems.

Most Facilities Management capital projects are requested and prioritized under the
annual General Fund Facilities Project Prioritization Process. New project requests
originate from facility lifecycle replacement plans, facility assessments, engineering
studies, testing results, citizen requests, regulatory compliance, and identification of
asset deterioration by City facilities staff. Projects are reviewed by a committee of
subject matter experts from various departments and are evaluated and prioritized on
the basis of human safety, service continuity, damage avoidance, aesthetic deficiency
mitigation, regulatory considerations, and potential for increasing efficiency.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens' General Obligation Bond Committee prior to approval by the

Fire Protection

The $146.4 million Fire Protection program is funded by Other Restricted, 2023
General Obligation Bond, Other Bond, Capital Grant, and Development Impact Fee
funds.



The Phoenix Fire Department plans for CIP projects through a prioritized strategic
forecasting process. The most significant projects for the department are construction
of future fire stations that have been forecasted through the creation of a twenty-year
fire station implementation plan. The forecast plan was developed through analysis of
a variety of factors such as: existing fire stations’ location and capacity, key
performance indicators, and planned growth. Additionally, other identified new CIP
project needs are presented to the Fire Department executive staff in the form of
business cases that are then evaluated based on the potential positive impact on
service delivery to the Phoenix community.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the
bond program, with a fourth - the replacement of Fire Station 15 (new location near
45th Avenue and Camelback Road) - already under construction.

In addition to the General Obligation Bond Program, in April 2025, the City Council
approved the sale of excise tax bond obligations that are being used in this Capital
Improvement Program to construct two fire stations, acquire new fire apparatus, and
replace existing fire apparatus.

Major projects include:
• Implementation of a new Computer Aided Dispatch System and Records
Management System
• Acquisition of fire apparatus
• Construction of new Fire Station 51 located near 51st Avenue and SR 303
• Construction of new Fire Station 71 located near 60th Street and Mayo Boulevard
• Construction of new Fire Station 93 located near I-17 and Peoria Avenue
• Replacement of Fire Station 7 (new location near 4th Street and Townley Avenue)
• Replacement of Fire Station 13 (new location near 50th Street and Thomas Road)

Historic Preservation & Planning

The Historic Preservation and Planning program totals $3.0 million and is funded by
2023 General Obligation Bond funds.



Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens' General Obligation Bond Committee prior to approval by the

Housing

The Housing program totals $177.9 million and is funded by Operating Grant, Other
Restricted, 2023 General Obligation Bond, and Capital Grant funds.

The program provides funding for the creation and preservation of public and
affordable housing units for low-income families, individuals, seniors, and special
populations throughout the city. Grant-funded projects are planned based on the
availability of these funds.

2023 General Obligation Bond projects will fund the preservation of City-owned
affordable housing units and creation of affordable units in the Edison-Eastlake
community. Grant funds include the U.S. Department of Housing and Urban
Development's (HUD) Choice Neighborhoods development projects, HUD HOME
Investment Partnership Program multifamily loan and redevelopment, HUD HOME
American Rescue Plan to serve qualifying populations, and the conversion or
modernization of existing public housing units through the HUD Capital Fund Program.

Housing Department capital improvement projects are identified based on City
management's priority list and the Mayor and Council's Affordable Housing Initiative, in
coordination with planned redevelopment programs, feedback from the Public Housing
Resident Advisory Board, the Affordable Housing Development Community, and other
stakeholders. The department's program and fiscal staff actively participate in
prioritizing funding availability and addressing community housing needs and
contractual terms of co-developers.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens' General Obligation Bond Committee prior to approval by the

Human Services

The Human Services program totals $6.9 million and is funded by Other Restricted
and 2023 General Obligation Bond funds.

The Human Services program includes acquisition, design, and


renovation/construction of shelters and senior centers.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the

Major projects include:
• Senior Center in Laveen
• Renovation of the McDowell Senior Center

Information Technology

The $119.1 million Information Technology program is funded by General, Arizona
Highway User Revenue, Development Services, Other Restricted, Transportation
2050, Aviation, Convention Center, Solid Waste, Wastewater, Water, Other Bond, Solid
Waste Bond, Wastewater Bond, Water Bond, and Development Impact Fee funds.

Information Technology CIP projects typically go through a review process and are
managed by IT project managers. The review process provides City leadership
visibility into information technology spending across the organization and helps
ensure technology purchases are in alignment with current and future technology
needs. Projects are evaluated and approved by various Information Technology
Services divisions for security, application, and infrastructure considerations.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Major projects include:
• Implementation of an enterprise time and labor system
• Replacement of public safety radios that are at end-of-life
• Data network infrastructure modernization

Libraries

The Libraries program totals $34.2 million and is funded by General, Development
Impact Fee, and 2023 General Obligation Bond funds.

Improvement and renovation projects are requested and prioritized under the annual


General Fund Facilities Project Prioritization Process. New project requests originate
from facility lifecycle replacement plans, facility assessments, engineering studies,
testing results, citizen requests, regulatory compliance, and identification of asset
deterioration by City facilities staff. Projects are reviewed by a committee of subject
matter experts from various departments and are evaluated and prioritized on the
basis of human safety, service continuity, damage avoidance, aesthetic deficiency
mitigation, regulatory considerations and potential for increasing efficiency.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the

Major projects include:
• Expansion of the Yucca Branch Library
• Construction of a new Estrella Civic Space Library at 99th Avenue and Lower
Buckeye Road
• Construction of a new Desert View Civic Space Library at Deer Valley Drive and
Tatum Boulevard

Municipal Court

The Municipal Court program totals $2.9 million and is funded by General funds.

The program includes the Court Case Management System replacement project which
targets the Phoenix Municipal Court's primary business application. This multi-year
project envisions replacing the existing almost 27-year-old system which is no longer
sustainable with a modern application. The new application will increase efficiency,
expand self-service options for the public, enhance the Court's ability to offer remote
contact and participation, reduce existing technical debt, and enable the Court's ability
to move to real-time paperless processing.

Neighborhood Services

The Neighborhood Services program totals $4.8 million and is funded by Operating
Grant funds.



The Neighborhood Services program seeks to stabilize neighborhoods and improve
infrastructure by acquiring properties for revitalization. By partnering with City
departments, projects such as landscaping, sidewalks, lighting and other infrastructure
improvements provide enhancements to City neighborhoods.

The Neighborhood Services Department considers new CIP projects through the
efforts of their Neighborhood Enhancement and Infrastructure Team, which works
closely with program staff, to identify potential CIP projects. Projects may also be
proposed by the City Council or City management and evaluated based on availability
of funding, eligibility of project area and scope which meets a HUD National Objective.
Additionally, qualitative feedback is collected through community workshops,
stakeholder consultations, and public requests, for projects such as: facility
renovations, improvements to community centers, playgrounds, and other
enhancements to community public infrastructure. Large projects, like acquisition of
strategic or blighted properties, may be identified through other City programs and
initiatives to expand the impact and/or better address the needs of the community such
as providing affordable housing or creating Safe Routes to Schools.

Non-Departmental Capital

The non-departmental capital program totals $656.6 million and is funded by General,
Aviation Bond, Other Bond, Solid Waste Bond, Wastewater Bond, Water Bond, Capital
Grant, Capital Reserve, Customer Facility Charge, Federal, State and Other
Participation, and Passenger Facility Charge funds.

The non-departmental capital program consists of existing and anticipated future
capital debt service, including payments of principal, interest, issuance costs and
related expenditures such as trustee fees for bonds issued. The capital debt program
reflects debt service for capital projects funded in other capital improvement programs.

The non-departmental capital program additionally includes a contingency budget for
future capital grant awards, a set-aside to support operating costs on future capital
projects, and reserves to provide local matching funds for potential federal capital
grants.

Parks, Recreation & Mountain Preserves

The Parks, Recreation and Mountain Preserves program totals $321.6 million and is
funded by Parks and Preserves Initiative, Golf, 2023 General Obligation Bond, and
Development Impact Fee funds.



The program includes land acquisition; improvement and rehabilitation of city parks,
trails, sports fields, and pools; installation and replacement of security and sports field
lighting; parking lot improvements; construction of ADA accessible amenities; and
other citywide park infrastructure improvements.

Projects in the Parks and Recreation Department's CIP are prioritized within the five-
year planning window based primarily on park needs and priority criteria. This process
includes a three-tiered rating system that takes into account the life span of amenities.
The rating identifies amenities that are new, at half-life or ready for replacement.
Ratings are updated annually. Further, when a need is identified at a park facility, a
holistic look is used to evaluate if other needs can also be addressed at the same time.
This approach results in cost effectiveness, efficiencies and reduces redundancy of
services to the same site and minimizes impact to the community. Also, a
consideration for new park projects and preserve land acquisitions is population
growth, creating the need for parks expansion.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City's Infrastructure Financing Plan, which is reviewed by a citizens' committee prior to
public and ultimate adoption by the City Council.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens' General Obligation Bond Committee prior to approval by the

Major projects with various funding sources include development, improvements
and/or repairs to Cortez Park, Encanto Park Lake, Estrella Civic Space, Granada Park,
Highline Park, Lone Mountain Park, Maryvale Park Regional Pool and Two Splash Pad
Sites, and North Mountain Park.

Phoenix Convention Center

The Phoenix Convention Center program totals $43.6 million and is funded by Sports
Facilities, Biosciences, and Tourism, Convention Center and Other Bond funds.

In addition to the Convention Center, this program includes projects and improvements
for the Herberger Theater Center and Orpheum Theatre, Symphony Hall, and the
Heritage and Convention Center parking garages. General Fund-supported excise tax
bonds are programmed for renovations of the 100 West Washington building.



The Phoenix Convention Center has a multi-discipline CIP committee comprised of
members of the department including management, facility and capital project
managers, fiscal, as well as subject matter experts. The committee meets monthly to
identify and discuss potential CIP projects. CIP projects are initially submitted, and
subsequently modified, through a project request form. The projects are then reviewed
and ranked by staff for inclusion to a perpetual 10-year CIP forecast that is constantly
evaluated and updated. Project considerations include life safety, revenue generation,
facility enhancement, and business and customer impact.

Major projects include:
• Symphony Hall Theatrical Venue Improvements
• Herberger Theater Center Theatrical Improvements
• 100 West Washington Renovations
• Roof Repairs for the South Building
• Replace the Digital Audio Distribution System at the South Building
• North and West Buildings Heating, Ventilation, and Air Conditioning and Fire Alarm
System Replacement
• North and West Buildings Security Systems Replacement
• Orpheum Theatre Improvements
• Pit Lift Replacements at the Herberger Theater, Orpheum Theatre, and Symphony
Hall

Police Protection

The $46.5 million Police Protection program is funded by Capital Reserve,
Development Impact Fee, and 2023 General Obligation Bond funds.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the

Major projects include:
• Replacement of the Cactus Park Precinct
• Renovation of the Police Property Management Warehouse


• Replacement of Aerial Fleet Assets

Public Art Program

The Public Art Program totals $15.8 million and is funded by Percent-for-Art funds.
Established in 1986, the Public Art Program allocates one percent of eligible Capital
Improvement Program funding for the acquisition of temporary and permanent artwork
for public buildings, infrastructure, and spaces. The program maintains more than 200
permanent artworks and manages and exhibits the City's 1,200 portable works in
multiple public buildings.

The program works closely with all capital departments, City Council offices and the
Phoenix Arts and Culture Commission to determine and approve projects to be
included in the annual Public Art Plan. Public art projects included in the Plan are
prioritized based on opportunities to integrate artwork into individual Capital
Improvement Program projects and their potential impact on the neighborhood and the
broader arts community.

Public Transit

The Public Transit program totals $1,438.1 million and is funded by Operating Grant,
Regional Transit, and Transportation 2050 funds.

Public Transit staff and management identify project needs by utilizing several
planning documents - the Transportation 2050 Plan, the fleet replacement plan, the
Maricopa Association of Governments Transportation Improvement Program, and the
Transit Life Cycle Program element of the Regional Transportation Plan. Additionally,
public assets are considered for potential refurbishment, upgrade, or replacement.
Staff from each division submit project requests to Public Transit management for
review, prioritization, and funding consideration.

Major projects include:
• Purchase of new and replacement buses, Dial-A-Ride vehicles and commuter vans
• Bus Rapid Transit program development
• Construction of bus stop improvements, lighting and shade structures
• Design and construction of the North Transit Facility Operations and Maintenance
Garage
• Design and construction of the West Phoenix Maryvale light rail extension is not
reflected but is planned to be incorporated in the final Capital Improvement Program

Regional Wireless Cooperative



The Regional Wireless Cooperative (RWC) program totals $89.6 million and is funded
through the contributions of RWC member agencies.

The RWC capital program’s objective is to develop and assist member agencies with
projects necessary to procure, install and upgrade major components of the radio
systems over which the RWC has responsibility - for example, major system
expansions to enhance capabilities, functions, or redundancy, or to incorporate
technologies or functions required through legal mandates or vendor-driven changes.

The RWC identifies capital improvement projects via a governance and policy process.
Projects and inventory are tracked, prioritized, and scheduled by the RWC Network
Manager, the City of Phoenix Information Technology Services Department, which
presents the projects’ explanations and expected budgetary needs to RWC
Administration. The costs are then distributed based on the number of radios in use by
each agency, or by special assessments, and are then presented by the RWC
Executive Director to the RWC Board of Directors for action. Specific RWC Working
Groups may also be asked to consider and draft large-scale CIP projects as needed.

Solid Waste Disposal

The $112.3 million Solid Waste Disposal program is funded by Solid Waste, Solid
Waste Bond, and Solid Waste Remediation funds.

The Solid Waste Disposal program includes various projects at the City's landfills and
transfer stations to ensure environmental compliance and support infrastructure
upgrades.

New Solid Waste Disposal CIP projects are evaluated and prioritized using an annual
project evaluation process. Staff submit a business case to provide information about
the new program or project request. The evaluation report describes the project scope
and identifies the essential needs criteria for the successful operation of the utility. The
Public Works Director and Assistant Directors review the requests and evaluate and
prioritize the projects in the following areas: customer service, system benefits and
efficiency, project benefits and impact, system reliability, operational flexibility, system
security, system replacement and rehabilitation, regulatory compliance, and system
growth. In addition to staff reviews, a Citizens Solid Waste Rate Advisory Committee
performs an advisory role in reviewing the Solid Waste Utility Financial Plan and
advising on the operating and capital program expenses and projects.

Major projects include:


• 27th Avenue Materials Recovery Facility, Transfer Station, and Composting Facility
Infrastructure Improvements and Expansion
• 27th Avenue Resource Innovation Campus Water, Sewer, and Electrical
Infrastructure Improvements
• North Gateway Materials Recovery Facility and Transfer Station Infrastructure
Improvements and Expansion
• SR 85 Landfill Infrastructure Improvements and Expansion
• Maintenance and monitoring of open and closed landfill gas systems
• Vehicle replacements

Street Transportation & Drainage

The Street Transportation and Drainage program totals $1,198.1 million and is funded
by General, Arizona Highway User Revenue, Capital Construction, Transportation
2050, Wastewater, 2023 General Obligation Bond, Capital Reserve, Development
Impact Fee, and partner agency contribution funds.

The program includes ongoing major maintenance of streets and bridges, new and
expanded streets, mobility improvements, pedestrian traffic safety improvements
including the Roadway Safety Action Plan, technology enhancements and storm water
improvements, and prioritizes an accelerated citywide pavement maintenance
program.

The Street Transportation Department maintains an ongoing annual project
identification and prioritization process. The process begins with the collection of “Call
for Projects” forms submitted by staff. These forms require various quantitative data on
the projects such as: relative traffic volume, speeds, collision history, existing pre-
design efforts or studies, and ADA requirements. The requests are gathered and
evaluated. Immediate funding needs for existing funded projects and programs, and
local funding matches required to leverage outside funding, are prioritized.
Prioritization of new project and program proposals considers immediate life safety
needs; the existence of completed pre-design studies with economical, feasible and
publicly supported recommendations; and equity in project distribution. Project
prioritization outcomes are presented to department management for review.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.



Projects funded by the 2023 General Obligation Bond Program were reviewed and
prioritized by a citizens’ General Obligation Bond Committee prior to approval by the
Programs, Residential Overlay, and Vision Zero Program Implementation.

Major projects planned include improvements to the following locations:
• Paradise Ridge Drainage Improvements
• Indian School Road: 39th Avenue to 91st Avenue
• Rio Salado River Bicycle/Pedestrian Bridge at 3rd Street
• Southern Avenue: 51st Avenue to 37th Drive
• Dobbins Road: SR 303 to 27th Avenue
• North Valley Parkway Bridge over the Sonoran Wash

Sustainability

The $5.0 million Sustainability program is funded by General funds.

The Sustainability program provides funding for various citywide energy and water
efficiency projects that reduce energy and water usage, while also decreasing ongoing
operational costs. Cost savings realized from implementation of these projects may be
used to replenish this fund for additional future projects.

Wastewater

The Wastewater program totals $1,880.9 million and is funded by Wastewater,
Wastewater Bond, Development Impact Fee, and Other Cities’ Share in Joint Venture
funds.

The Wastewater program includes infrastructure, safety, maintenance, technology and
efficiency enhancements for the 91st Avenue and 23rd Avenue wastewater treatment
plants, Cave Creek Water Reclamation Plant, North Gateway Advanced Water
Reclamation Plant, multi-city and Phoenix sewer line systems, lift stations, support
facilities and other related initiatives.

The need for a new water or wastewater CIP project is identified by various means
such as: an identifiable operational issue, the result of a study, a condition
assessment, age of equipment or infrastructure, new technology, growth, increased
number of pipe breaks, developer requests, City Council requests, and neighborhood
requests. Once it has been determined a project has merit, staff submit a project
request form, and the proposed project is included in the department’s annual Project
Charter Process. The department’s deputy directors of water and wastewater


engineering then determine optimal timing, the approach for lowest cost, and
coordinate with the affected operational division. All current and new CIP projects are
presented to department executive staff and prioritized based on factors including risk
of failure, criticality, timing and funding availability. Staff recommendations are
reviewed by the Water and Wastewater Rates and Advisory Citizens’
Committee, and then by the City Council’s Transportation, Infrastructure and Planning
Subcommittee.

Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Water

The Water program totals $2,775.0 million and is funded by Water, Wastewater, Water
Bond, Solid Waste Bond, Capital Grant, Development Impact Fee, and Other Cities’
Share in Joint Venture funds.

The Water program includes a new North Gateway Advanced Water Purification Plant,
infrastructure improvements, technology and efficiency enhancements for water
treatment plants, water storage facilities, wells, pressure reducing valve stations,
booster pump stations, water and transmission mains and other water related
initiatives. Investments in power redundancy and water resiliency programs ensure
stable water delivery for customers.

The need for a new water or wastewater CIP project is identified by various means
such as: an identifiable operational issue, the result of a study, a condition
assessment, age of equipment or infrastructure, new technology, growth, increased
number of pipe breaks, developer requests, City Council requests, and neighborhood
requests. Once it has been determined a project has merit, staff submit a project
request form, and the proposed project is included in the department’s annual Project
Charter Process. The department’s deputy directors of water and wastewater
engineering then determine optimal timing, the approach for lowest cost, and
coordinate with the affected operational division. All current and new CIP projects are
presented to department executive staff and prioritized based on factors including risk
of failure, criticality, timing and funding availability. Staff recommendations are
reviewed by the Water and Wastewater rates and advisory citizens’ committee, and
then by the City Council’s Transportation, Infrastructure and Planning Subcommittee.



Development Impact Fee-funded projects are identified in accordance with state
statutes, ensuring capital funding for service levels in planning areas is consistent with
service levels in developed areas of the City. Identified projects are incorporated in the
City’s Infrastructure Financing Plan, which is reviewed by a citizens’ committee prior to
public hearings and ultimate adoption by the City Council.

Responsible Department
This item is submitted by City Manager Ed Zuercher, Deputy City Manager Amber
Williamson, and the Budget and Research Department.