Public Hearing For Proposed FY 2013 2014 Budget and Property Tax Levy.
RECOMMENDED ACTION

  Consideration and Adoption of Resolution No. 2013-14:  CONSIDERATION AND APPROVAL OF RESOLUTION NO. 2013-14 A RESOLUTION FOR THE ADOPTION OF THE BUDGET FOR FISCAL YEAR 2013-2014 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 18, 2013 (during a Special Meeting) and the Property Tax Levy ordinance will have a first read on June 18, 2013 and will have the second read on July 2, 2013.

• The final budget adoption allows the City to commit and expend resources as determined to be needed through the FY2013-2014 budget process.
• The City of Flagstaff will levy flat revenue for primary property taxes at a rate of $0.8429 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 $94,078.00.

Effective governance
Repair Replace maintain infrastructure (streets & utilities)

• Budget Retreats on November 14 & 15, 2012  & February 14, 2013
• Mini Budget Retreats on December 12, 2012, January 11 & 22, 2013 & February 4, 2013
• Council Budget Meetings on April 24, 25, and 26, 2013
• Tentative Budget Adoption on June 4, 2013

Public Hearing:

• Open the public hearing
• Delay the public hearing

Final Budget Adoption

• As the City adopted the tentative budget on June 4, 2013, the maximum appropriation for FY2013-2014 has been set.  The Council could choose to make adjustments within that maximum appropriation

Budget adoption:
The budget was presented for tentative adoption on June 4, 2013.  The tentative adoption established the maximum appropriation for the City for the FY 2013-2014 budget year.   The budget legal schedules were published in the Arizona Daily Sun on June 6, 2013 and June 13, 2013.
 
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 FY2013-2014 and no additional notifications are required.

The adoption of the tentative budget sets 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.

            June 4, 2013               Tentative adoption of budget by Council
            June 18, 2013             Proposed budget and property tax levy hearing
            June 18, 2013             Final budget adoption (done in a Special meeting)
            June 18, 2013             First reading property tax ordinance
            July 2, 2013                 Final reading and adoption of property tax ordinance

The City of Flagstaff is proposing a flat primary property levy on existing properties for the FY2013-2014 base levy of $5,426,095 plus new construction levy of $94,078 for a total levy of $5,520.173.  The maximum allowable primary property revenue for FY2013-2014 is $5,742,768.   The City of Flagstaff is not proposing a change in the secondary property tax rate for FY2013-2014.
 
Primary property tax rate will increase from $0.7131 in FY2012-2013 to $0.8429 in FY2013-2014 due to the total valuation of all existing properties are decreasing 15.4%. 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 priorities into fiscal reality.  Timely budget adoption allows the City to commit expenditures as related to the FY2013-2014 budget as needed for ongoing operational consistency to the citizenry. The FY2013-2014 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 6, 2013 and June 13, 2013 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 2, 2013 Council Meeting.

06/18/2013 - EAB - Public Hearing held; Special Meeting opened and Resolution read and adopted.