On May 24, Cottonwood City Hall hosted a budget open house, “for people to ask questions in an open setting,” about the proposed 2023 fiscal year budget; however, no one from the community attended, so the event quickly evolved into a Q & A session with Cottonwood Journal Extra.
“I think you should write an article about how people should be involved,” joked Cottonwood Financial Services Director Kirsten Lennon, who presented the tentative budget along with City Manager Ron Corbin.
Additional opportunities for the community to discuss budget concerns before its tentative adoption on June 21 can be found on the 21 can be found on the city’s website.
In the meantime, the budget is expected to pass at $139 million, an increase of $19 million from last year.
The reason for the increase is largely due to a substantial upsurge in overall revenue, with urban revenue sharing, aka the state of Arizona’s income tax collection, seeing the largest increase.
“[Urban revenue] is increasing by 46% this year from last year’s numbers,” Lennon said. “It’s going from $1.5 million to $2 million.” U.S. Census data indicates an increase in the city’s population from 11,265 in 2010 to 12,019 in 2020. According to Lennon, general sales have also increased, surpassing pre-pandemic levels.
“It’s higher than pre-COVID-19,” she said. “We have done way better since then than we did beforehand [as] people are getting out and about more.” “There was a lot of excess money early on during COVID-19, and then right now with unemployment less than 3%, people are working,” Corbin said. “I know with inflation, they appear to have less money, but our sales tax revenue is based on sales so as prices increase so do our revenues.” “Our sales tax is about 60% of our General Fund revenue, and we anticipate this year we’re going to end up 10% over last year’s numbers,” Lennon said.
Up to $3 million in Highway User Revenue Funds will go toward a variety of street projects, while $2 million in [American Rescue Plan Act] funds will be used to improve and clean wastewater infrastructure.
“[The wastewater system] has never been taken offline, so we’re going to clean and fix some of the stuff that hasn’t been touched in 35 years,” Corbin said.
“With the ARPA funds, if you got under $10 million as your allocation, you can classify it as lost revenue and use it for operations,” Lennon said.
Up to $800,000 in federal grant money will go toward studying airport infrastructure, including pavement preservation and environmental studies to renovate the runway.
Some of the most expensive projects the city is planning for fall is under the category of capital projects.
“We had about $58 million in capital requests,” Lennon said.
Some of the requests include refurbishing the recently-puchased new city hall building, designing a new evidence building for law enforcement, airport improvements, public transportation improvements and new fire department vehicles.
“We are actually going to fund about $50 million of those $58 million requests, because it is a year that we have a lot of carryover from last year,” Lennon said. “So we said, ‘OK, let’s get these projects done and let’s do this infrastructure.’” Lennon said that additional road projects, including working toward repaving Main Street from “Walgreens all the way to Clarkdale through Old Town,” will begin this year.
“So hopefully in two years, from State Route 89 and State Route 260 to Clarkdale will all be repaved,” Corbin said.
Additionally, all of the city’s events, including the 4th of July celebration, will be fully funded next year, according to Corbin.
“We spend a pretty penny,” he said.
While improvements to infrastructure, city departments and events take up a large amount of the budget, the city also has a fund set aside to help first-time homebuyers find affordable housing in the form of a down-payment assistance program.
Corbin said about $400,000 has been set aside to “seed-plant our money for helping people find a house.” Lennon said the money is available for people who work in Cottonwood and live in the Verde Valley.
“[A] $5,000 [down payment] can get you up to $20,000 depending on your income,” Corbin said.
The program also includes free counseling to assist homebuyers with navigating the loan process.
“So that’s a really good program and we’re hoping people take advantage of it,” Lennon said.
Additional money has been set aside for other housing-related projects, such as restoring and adding units to Verde Plaza.
“[The council] has to get a state grant [to begin the project], so $250,000 is set aside to help them with that grant, but if they don’t get that grant, the money will be available for other projects,” Corbin said.
Lennon stated that the proposed budget will not be spent in its entirety, but it will grant the city the spending authority based on the budget amounts.
