May 5—Chandler's recent boom economic times are starting to wind down and the budget city staff presented to the city council is reflecting that.
Staff briefed Council at an all-day budget session on April 26, proposing a $1.629 billion spending plan for the fiscal year that starts July 1. That is 1.6% less than the current $1.66 billion budget.
"This is a fiscally prudent budget that focuses on core services, infrastructure and using one-time revenues to create long-term savings and opportunities," said Dawn Lang, the deputy city manager and chief financial officer.
The city has had a lot of extra one-time dollars in recent years, primarily because of two factors: The first is millions handed out by the federal government for pandemic relief. The second is Intel's expansion of its Ocotillo campus and workers spending money here have propelled sales tax revenue.
Both of those are coming to an end. Lang said the city only has a little more than $1 million of its American Rescue Plan Act funds left and those funds must be spent by the end of this calendar year.
Construction at Intel's campus proceeds and the latest estimate is it will wrap up in 2026. Then all those construction workers will move on to the next job and no longer be spending their money in Chandler.
There is a proposed increase in the capital improvement budget, driven largely by inflation. That jumped 2.3% to $876.5 million. Staff made up for that by decreasing the operating budget 5.4% to $752.6 million.
The proposed budget that Council will be voting on this month continues to cut the primary property tax rate for the ninth straight year and contains no increases to utility rates.
One of the priorities for this year's budget was converting employees who are being paid with those extra one-time funds to getting paid with General Fund dollars. Lang said the city could do that for 26 city employees.
"I think we're all in favor of taking these one-time employees that have been one-time employees for longer than the duration for some other employees and turning them into ongoing where it makes sense," Mayor Kevin Hartke said.
Council has made it a priority to turn one-time dollars into ongoing savings and Hartke pointed to two previous projects that accomplished this. The first was using that extra money to pay off the city's unpaid liability to the Arizona Public Service Personnel Retirement System that covers pensions for retired police and firefighters.
Chandler has paid $122 million toward that debt in the past two years and believes it is close to having paid it off. Officials won't find out until June 30 if it is paid off, or if they still owe a small amount. The proposed budget includes $7 million in case some debt remains or if its future payments to the fund must increase.