Cottonwood city council votes 4-3 vote to approve $69M budget

Cottonwood's city council voted 4-3 to approve a budget increase that would be paid for by a planned sales tax increase to be voted on at future council meetings. Hunt Mercier/Larson Newspapers

The Cottonwood City Council approved its tentative budget for Fiscal Year 2018-19 at a special meeting Monday, June 25.

The approved budget totals $69,528,685, an increase of 4.6 percent from FY 2018’s revised budget of $66,481,415.

The increases came from three areas the council has made plans to allocate more funds toward: Road repairs, replenishing the city’s reserve funds and paying down pension liabilities.

In late May and early June, council voted to move forward with plans to increase the city’s sales tax by 0.5 percent to pay for these three areas of funding. The tax increase will still need to be officially approved by the council after public hearings on Tuesday, Aug. 7, and Tuesday, Sept. 4.

“None of the items that were discussed to be added with the 0.5 percent will actually be funded unless that 0.5 percent goes through all the way and is established,” Cottonwood Finance Director Kirsten Lennon told the council as she presented the budget.

The vote approving the budget passed narrowly, by a 4-3 margin. Councilwomen Linda Norman and Karen Pfeifer joined Vice Mayor Kyla Allen and Mayor Tim Elinski in approving the budget, with Councilwomen Tosca Henry and Deb Althouse and Councilman Ruben Jauregui voting against. The split mirrored the vote on the proposed tax increase in previous council meetings.

In addition to the road funds, reserves and pension liabilities, the approved budget includes funding to hire two new city employees: A building official in the Planning and Zoning Department and a project manager for utilities in the Engineering Department.

The budget reclassifies 42 city employees to higher wage ranges, partially to keep up with the minimum wage increase approved by Arizona voters in 2016, and with many upgrades for communications employees to stay competitive with other neighboring communities in tourism.

Departments were allocated funding for merit pay increases of 4 percent, a decrease from the 5 percent merit increases originally requested.

The budget also includes a 3 percent increase in the costs of employee health insurance premiums.

In approving the budget, the council spent time discussing the fate of the Old Town Association, which is still reeling from the embezzlement of tens of thousands of dollars from its bank accounts, allegedly by its former treasurer Traci Koelzer.

The current budget does not allocate any funds towards the Old Town Association, after having previously budgeted $10,000 for the association.

Henry expressed misgivings about the lack of funding for the OTA.

“It really sends a pretty strong message to our Old Town merchants that our city is turning its back on its Old Town,” she said.

City Manager Doug Bartosh defended the decision not to fund the association in the budget.

“There’s certainly no attempt to keep them from getting this money, but I think it’s in the best interest of the city to make sure that there are safeguards in place so this doesn’t happen again,” Bartosh said. “I think it’s important that the council and your constituents have assurances that the money’s going to be handled and with the safeguards to catch something before it gets out of hand.”

Brenda Clouston, new president of the OTA and Gavin Gallifant, the new treasurer, spoke on behalf of the association, saying they had fixed the previous issues, but that the group would not be able to survive without the help of the council.

“We believe that we can do this very easily,” Clouston said. “We’re going to put strong respectful leadership in place so that we continue to foster good will do here and have that spread throughout Cottonwood.”

“We just really need to continue on with these events and I don’t think we can do it without the city’s help,” she said. “So we’re here to humbly request that we be included in the budget for these events and marketing for Old Town.”

“We have to remember that the Old Town Association is the victim of a crime. There was a criminal mind at work and anyone could have been a victim,” Elinski said. “It’s no great surprise that nobody knew this was happening.”

In the end, the council decided against funding the OTA in this round of the budget, but members suggested interest in funding it in the future.

In addition to passing the budget, the council approved a contract with the Novak Consulting Group to recruit new candidates for the position of city manager, due to Bartosh retiring at the end of the year. The group’s fee for the search is $21,300, included in the approved budget.

Jon Hecht can be reached at 634-8551 or email jhecht@larsonnewspapers.com

Jon Hecht

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