SIERRA VISTA — City Council members were presented with a tentative budget earlier this week that rose by almost $1 million in one day, courtesy of spiking construction costs nationwide.
On Monday afternoon at a budget workshop, City Council members were told that the fiscal year 2022 budget would be just over $114.8 million. But that grew to a little over $115.7 million on Tuesday when city officials had to factor in higher construction costs for a planned emergency management services station at Buffalo Soldier Trail and Seventh Street.
Deputy City Manager Victoria Yarbrough told the panel at a budget work session the city had received the bad news about higher construction costs for the EMS station last week. Sierra Vista was awarded a grant of almost $1.5 million to build the facility, with the city kicking in $100,000 to complete the architectural and engineering work. But last Friday, city officials learned that it would cost close to $2.8 million to build the station. Yarbrough said construction costs nationwide have jumped between 30% and 40%.
“We needed to make an adjustment yesterday for the increase in costs for the EMS substation,” Yarbrough told the Herald/Review in an email Wednesday. “So the final total going on the tentative budget resolution next week is $115,711,558.”
Before the budget presentation kicked off, City Manager Charles Potucek told council members, “We have some challenges and opportunities ahead.”
According to the tentative budget given to the City Council, the largest portion of the municipality’s expenses comes from capital improvements at 42%. The next highest expense is personnel at 32%, followed by operations and maintenance at 22% and debt at 4%.
Other changes highlighted by Yarbrough included an additional $50,000 for a city website redesign, a $43,894 increase in legal fees for the city, an additional $44,160 for traumatic event counseling services for public safety personnel and $45,000 for body camera cloud storage increase.
Another new expense will include paying a part-time security guard $31,000 to keep an eye on “unruly” patrons at the city’s public library, Yarbrough said.
“There are a number of unruly people who like to visit the library,” Yarbrough said. “It’s not all just quiet people checking out books and looking at the internet.
“There are unfortunately some problems over there and we believe a security guard will help.”
Before the security guard idea surfaced, badly behaved library visitors were kept at bay with the help of the Arizona Rangers, a uniformed, law enforcement auxiliary, city officials said.
Aside from all the expenditures, there will be at least one new revenue stream coming to the city — and other municipalities across the state — by way of legalized marijuana, Yarbrough said.
“In 2020 Arizona voters passed Prop 207 (Safe and Smart Arizona Act), which legalized adult recreational marijuana use,” Yarbrough said. “The initiative established a 16% state tax on the sale of marijuana, regardless of where it’s sold. That money goes into a fund, which has various distribution requirements, but 25.4% of the money raised goes back to cities for local law enforcement and fire departments.”
That could mean about $150,000 for Sierra Vista, the budget presentation shows.
Yarbrough said the next steps in the process will include a vote on the tentative budget by the City Council at its regular meeting on June 24.
“(This) is a statutory requirement that sets the cap for the budget,” Yarbrough said. “The final budget can be less than or equal to the $115 million amount, but can’t exceed it.”
An approval of the final budget is expected on July 22, along with a public hearing on the property tax levy. The latter will be adopted on Aug. 12, Yarbrough said.