Public Hearing For Proposed FY 2015 – 2016 Budget and Property Tax Levy.
RECOMMENDED ACTION:
Consideration and Adoption of Resolution No. 2015-20: A resolution of the City Council of Flagstaff, Arizona, for the adoption of the Budget for Fiscal Year 2015-16 and Public Hearing for Budget and Levy.

In accordance with State law, a public hearing is required for final adoption of the budget, and the establishment of the property tax levy. This hearing provides for citizen input prior to adoption. Arizona State Statutes require each municipality to adopt a budget as prescribed by A.R.S. Title 42, Chapter 17, Articles 1 through 5. As published in the Tentative Adoption of the Budget, the Final Budget Adoption is to take place on June 16, 2015 (during a Special Meeting) and the Property Tax Levy ordinance will have a first read on June 16, 2015 and will have the second read on July 7, 2015.

• The final budget adoption allows the City to commit and expend resources as determined to be needed through the FY2015-2016 budget process.
• The City of Flagstaff will levy flat revenue for primary property taxes at a rate of $0.8234 and a flat rate for secondary property taxes at a rate of $0.8366. The City will also receive additional revenues related to new construction of $65,343.

• Invest in our employees and implement retention and attraction strategies
• Provide sustainable and equitable public facilities, services and infrastructure systems in an efficient and effective manner to serve all population areas and demographics
• As well as impacts many other Council goals

• December Budget Retreat on December 9 & 10, 2014
• Mini Budget Advance on January  22 & 28, 2015
• February Budget Advance on February 11 &12, 2015
• Council Budget Advance on April 21 & 22, 2015
   

 

Public Hearing:
Open the public hearing
Delay the public hearing

Final Budget Adoption
As the City adopted the tentative budget on June 2, 2015, the maximum appropriation for FY2015-2016 has been set. 
The Council could choose to make adjustments within that maximum appropriation or make reductions in the maximum appropriation.

Budget adoption:
The budget was presented for tentative adoption on June 2, 2015. The tentative adoption established the maximum appropriation for the City for the FY 2015-2016 budget year. The budget legal schedules were published in the Arizona Daily Sun on June 4, 2015 and June 11, 2015.

Property tax levy:
Primary property taxes are accumulated in the General Fund and pay for general services which include but are not limited to public safety, parks and recreation, other public work services, and general administrative and management functions within the City.

Secondary property taxes support debt service payments on numerous city capital projects including the Aquaplex, fire stations, open space, street/utility projects, forest restoration, and the future core facility.

Truth and taxation legislation:
Every year, the Truth in Taxation legislation requires that the county assessor, on or before February 10, transmit to each city and town an estimate of the total net assessed valuation of the city, including new property added to the tax roll. If the proposed primary tax levy amount, excluding amounts attributable to new construction, is greater than the levy amount in the previous year, the City must go through the ‘truth in taxation’ procedures. It is important to note that it is the levy amount and not the rate which triggers the truth in taxation procedure. The City of Flagstaff has not triggered the 'truth in taxation' notification and hearing for FY2015-2016 and no additional notifications are required.

The adoption of the tentative budget set forth into motion a legally mandated time sequence of actions of which the Council must adhere to adopt a final budget and to levy property taxes. If this time sequence is not met as required by statute, the tentative budget adoption, the final budget adoption, the property tax levy actions, and related publications must be started over. The final budget adoption must occur after a public hearing and Council must convene into a Special Meeting to adopt the final budget. The budget must be adopted by the third week of July. The County will adopt the property tax levy the first week of August. The key dates in the process have been presented as part of the action summary.

The City of Flagstaff is proposing a flat primary property levy on existing properties for the FY2015-2016 base levy of $5,561,740 plus new construction levy of $65,343 for a total levy of $5,627,083. The maximum allowable primary property revenue for FY2015-2016 is $6,091,109. The City of Flagstaff is not proposing a change in the secondary property tax rate for FY2015-2016.

Primary property tax rate will decrease from $0.8418 in FY2014-2015 to $0.8234 in FY2015-2016 due to the total valuation of all existing properties are increasing 2.2%. The ‘truth in taxation’ has not been triggered as the levy amount on existing properties is flat and it is not dependent on rate. The table below reflects a five year rate history:
 

Public investment into the budget process is necessary as a tool for the Council to use when determining the current year goals and objectives. The budget translates City Council's priorities into fiscal reality. Timely budget adoption allows the City to commit expenditures as related to the FY2015-2016 budget as needed for ongoing operational consistency to the citizenry. The FY2015-2016 budget is balanced.

Inform/Involve: This is the public hearing in the budget adoption process and it is open to public comment on the property tax levy and the final budget adoption. Budget legal schedules were published in the June 4, 2015 and June 11, 2015 Arizona Daily Sun to allow for additional community review. In addition, the legal and other budget schedules were made available at City Hall, at both Flagstaff Public Libraries, and on the official city website. The final opportunity for community involvement for the budget adoption is at this public meeting. The final opportunity for public input to the tax levy will be at the July 7, 2015 Council Meeting.