Consideration and Adoption of Resolution No. 2026-25:  A resolution of the Flagstaff City Council adopting the tentative budget for Fiscal Year 2026-27.
 

Arizona Revised Statutes (Sections 42-17101, 42-17102, and 42-17105) require that each municipality adopt and publish, in a specified format, a tentative budget. The adoption of the tentative budget has the effect of establishing an amount that cannot be exceeded in the final adoption of the budget.

Furthermore, the adoption of the tentative budget sets into motion a legally mandated time sequence of actions to which the Council must adhere to adopt a final budget and to levy property taxes.

The tentative budget must be adopted to set the appropriate sequence of events in place for final budget adoption.

The Fiscal Year 2026-27 budget is the guiding document for the financial plan of the City.

• December Council Retreat on December 19, 2025
• February Budget Retreat on February 5, 2026
• Council Budget Work Session on April 23, 2026

The City may delay the tentative budget adoption until no later than the third Monday in July.  While the City would be able to continue operations through a Continuing Disclosure resolution, the City would not be able to commit to any expenditures directly related to the Fiscal Year 2026-27 budget.

The budget is generally presented for tentative adoption in late May or early June to ensure funding is appropriated at the beginning of the fiscal year.  

At the December 2025 budget retreat, staff presented several topics including budget introduction, revenue updates, Council retreat planning, declared emergencies, and other updates.  During the February 2026 budget retreat, staff presented and received further direction from Council for the FY 2026-27 proposed budget.  Topics included revenue updates, available resources and fixed costs, emerging needs, and revenue considerations.  During the April 2026 budget work session, staff presented the City Manager's proposed budget and received Council direction.  After the April budget work session, divisions provided revised year-end estimates and carryover funding requests.

The adoption of the tentative budget sets into motion a legally mandated time sequence of actions to 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 for the tentative budget adoption, final budget adoption and property tax levy actions, and related publications, the process must be started over.  

The process is prescribed by the Arizona Revised Statutes. The tentative budget must be adopted no later than the 3rd Monday in July.  The schedules for the Council budget and property tax levy actions are as follows:

• June 2, 2026 - Tentative adoption of the budget by Council
• June 16, 2026 - Proposed budget and property tax levy public hearing
• June 16, 2026 - Final budget adoption (In a Special Meeting)
• June 16, 2026 - First reading of property tax ordinance
• July 7, 2026 - Final reading and adoption of the property tax ordinance

The adoption of the Annual Budget and Financial Plan provides Council direction and financial resources to support the Key Community Priorities and Objectives.

None.

The adoption of the Annual Budget and Financial Plan supports the Carbon Neutrality Plan by allocating financial resources to the Carbon Neutrality Plan goals.

The adoption of the Annual Budget and Financial Plan supports the 10-Year Housing Plan by allocating financial resources to the plan's strategies.

None.