Finance Director Brittany Earles presented the budget proposal for fiscal year 2027 to the Clarkdale Town Council at its regular meeting on Tuesday, May 12. This is the final update to the council and public before the tentative budget adoption on Tuesday, May 26, after press time.
The proposed budget for FY27 is $47,541,747, which is a 0.12% change from FY26 or an increase of $57,000. The General Fund increased by about 16%, mainly because of a larger contingency, or emergency, fund balance, not an increase in operating expenditures.
Donation fund expenditures significantly increased to accommodate a large donation that’s in progress and centered on library improvements. Overall capital project spending is set to increase, but the portion of that spending coming out of the General Fund has decreased. Most capital improvement spending is coming from grant funding or within the enterprise system.
The water budget is increasing to accommodate upcoming projects. There’s a decrease in the wastewater budget, but the town finished a big sewer project this fiscal year. Overall personnel costs are $80,000 lower than originally anticipated. Election costs also went down by $10,000 than anticipated because the city received candidates for upcoming elections.
During budget work sessions, staff recommended increasing the property tax levy to $800,000, which is an amount below the maximum allowable levy. Earles explained that this stemmed from current revenue source uncertainty because of past, pending and future legislative actions. Staff also took into consideration shared revenue reductions from the impending federal income tax conformity.
The levy amount adjustment will result in an increase of $10.79 per $100,000 of the net assessed value of a property. Earles gave two examples of different median properties in Clarkdale to show the tax bill increase. For a median-priced historic home on Main Street, the increase would be by about $19.79 for a full year. A median-priced new home in the Mountain Gate area would increase by about $28.66 per year.
Since the town is proposing an increase in the levy, this initiates a process called truth in taxation. A public hearing will be held on Tuesday, June 23.
For revenue, there’s budgeted to be an increase of $100,000 in building permit revenue and correlating construction-related sales tax. Earles said the town has seen historically low growth in state shared revenues over the past three years, mainly because of legislative impacts, income tax conformity and the addition of new municipalities.
For expenditures, $39.66 million is budgeted in town-wide capital improvements with $1.80 million from the existing general CIP fund balance, $32.98 million from grants and $4.88 million from enterprise fund sources.
General Fund
The General Fund is the primary operating governmental fund. Revenues for Clarkdale’s General Fund are heavily dependent upon tax revenue and susceptible to changes in the economy across local, state and federal levels. About $3.1 million is from local taxes, followed by $2.2 million from intergovernmental, $800,000 from property tax and $211,000 from permits and licenses.
General Fund expenditures center on municipal or government type services that are not revenue based. 31% of the General Fund expenditures are for contingency. This is budgeted for emergency scenarios and is typically not utilized. Police receive 24% of the expenditures, followed by town-wide at 11% and public works at 7%.
Earles said the town is “cautiously optimistic” as it approaches FY27. She anticipates ending this fiscal year slightly higher in major revenue sources than what they budgeted for, while overall revenues are down slightly from what they anticipated.
Earles stated the town is on track to meet FY26 sales tax revenues. Local sales tax is a large portion of the revenue source for the General Fund. The majority of sales tax comes from retail at 22%, followed by amusements at 20% and remote retail sales at 17%.
The town of Clarkdale only receives about 11% of a resident’s overall property tax bill. Educational related service providers like Mingus Union High School District, Clarkdale-Jerome School District and Yavapai College account for 46% of a resident’s bill. Verde Valley Fire District gets 27% and Yavapai County receives about 15% for county services like flood control and the library district.
In the General Fund budget, there’s an estimated 33% increase in state shared revenue, an increase in town-wide and community development department budgets for legally mandated expenses and a decrease in base personnel costs because of wage savings from recent retirements and organizational restructuring.
Enterprise Funds
Enterprise funds are non-tax supported and are managed like a business type fund. They operate independently of the General Fund and are typically supported by user fees. The town’s enterprise funds tend to be fairly consistent in revenue. The expenditures are for operations and investment into capital and infrastructure repairs or improvements.
Capital Projects
Over the past four years, the town has been awarded $17,176,119 in grant funding from local, county, state and federal combined. The town has prioritized grant funding for capital projects across its six different goal areas.
Capital projects that enhance the quality of life for residents and businesses include an infrastructure improvement plan, library and town hall building improvements and implementing an income aligned housing plan.
For enhancing the quality of parks and recreational opportunities, Community Development Block Grants will be used for park safety and Americans with Disabilities Act improvements at Centerville Park and $45,000 will be used for trail planning and development.
Capital projects that strengthen and diversify the economy include the continued funding of the tourism marketing program using hotel tax revenue and the funding of retail strategies.
Projects that plan for the maintenance and growth of quality infrastructure include the pavement management program, the Bitter Creek Bridge design/construction and the Upper Centerville Connector.
For attracting and retaining the town’s workforce, capital projects include the continued funding of cost-of-living increases and fleet replacement. For water conservation strategies, the town plans to replace hydrants, water mains and outdated lines in need of repair.
Continuing the budget process, the tentative budget was voted on at the council meeting on Tuesday, May 26, after press time. The adoption of the tentative budget sets the upper expenditure limit. On Tuesday, June 23, a public hearing will be held for the property tax levy and the final budget adoption. On Tuesday, July 14, the property tax levy will be adopted.
