Today’s economic climate forced both the city of Cotton-wood and town of Clarkdale to ask their residents to chip in a little extra for fiscal year 2009-10.
Cottonwood raised its sales tax to 3 percent in November 2008 bringing some extra revenue for the city during fiscal year 2008-09. FY 2009-10 will be the first year the city will see an entire year’s worth of income from the increase.
Clarkdale followed suit implementing a sales tax increase to 3 percent June 1 and adding a property tax increase and possible franchise fee.
Both communities’ staff said their municipalities made cuts to tighten their budgets.
Clarkdale Town Council adopted a final budget setting its expenditure cap at $33,699,902 for FY 2009-10, around $27 million higher than its FY 2008-09 final budget.
Cottonwood City Council adopted a budget of $132,562,405 for FY 2009-10, approximately $55 million larger than the city’s estimated FY 2008-09 final budget.
Budget caps are normally higher than the actual amount spent due to state statutes which say a town or city can not spend beyond its budget cap.
Towns and cities include any money they could potentially spend — from incoming grants, revenue increases — in the original budget cap to give them breathing room throughout the year.
City of Cottonwood
Cottonwood City Council unanimously approved its final budget Tuesday, Aug. 4. Councilman Terence Pratt and Councilwoman Linda Norman were absent.
Cottonwood Finance Director Rudy Rodriguez told council the $132 million budget includes capital projects and merit pay increases for employees but not cost of living.
Merit increases are based on pay grades with a range, and employees can achieve different levels based on an annual evaluation by their supervisors, City Manager Doug Bartosh said.
Councilman Darold Smith said there is a perception in the community the city doesn’t give raises to employees but is “spending money like water.” He understands that is not the case, but the public does not.
The misconception originates in the public’s misunderstanding of capital versus operation costs, Mayor Diane Joens said.
Capital costs are a one-time expense while operations costs are ongoing, Bartosh added.
The city is moving forward with capital projects to “pump money into the economy the best we can,” Rodriguez said.
In the 16 years Vice Mayor Karen Pfeifer said she’s served on council, the city has saved and saved and saved. Now, the city sees it can spend some of the money its saved to help the so-called recession.
Town of Clarkdale
Clarkdale Town Council adopted its final budget July 28 setting its expenditure limitation at $33.7 million for FY 2009-10. The town finished last fiscal year, FY 2008-09, with an estimated final budget of $6,258,757.
Town Manager Gayle Mabery said this year’s budget cap is much higher because the town included funding it could receive from the federal stimulus program.
Town staff first presented its budget plan to council in March to jump-start the process early. In April, the town held four budget workshops for the public to gather input on changes to taxes, which town staff said were necessary to balance the budget.
Town Council implemented a 0.75 percent sales tax increase June 1 and voted unanimously July 28 to raise property taxes to 0.9121 for every $100 in value from 0.71.
“Everybody wants more of what I have until my pocket is empty,” Bill Rowland, a Clarkdale resident, pleaded to the council.
Rowland was one of three residents who voiced their opposition to the town’s proposal to raise property taxes.
Rowland said he couldn’t believe the council considered rasing taxes at a time like this. People are biting the bullet and living within their means and the town should do the same.
“I can’t afford any more taxes,” Clarkdale resident Phyllis Douglas said.
In August, the council will adopt an ordinance to set the new rates.
“We are not the only taxing body that shows up on your real estate taxes,” Vice Mayor Jerry Wiley said. Residents can question the benefit they receive from each entity that appears on their bill.
“We, as a council, only control 9 percent of that tax bill,” Wiley said.
Town staff also proposed enacting a 2 percent franchise fee on residents’ Arizona Public Service bills Friday, Jan. 1, 2010, if more money is needed.
Town Finance Director Kathy Bainbridge said, however, if revenues don’t drop as anticipated, the council could elect not to implement the fee.
The town currently collects franchise fees on residents’ Cable One and UniSource bills, which brings in $36,000 a year.
Trista Steers can be reached at 282-7795, ext. 124, or e-mail tsteers@larsonnewspapers.com
