Tax hike part of final county budget

Yuma County’s budget for fiscal 2015-16 got its final approval Monday, with a 31-cent increase to the property tax rate and without any comment from members of the public.

The Yuma County Board of Supervisors approved the document 5-0, with most of them saying they weren’t happy about voting for a budget including an increase in the burden to taxpayers but consider it necessary under the current circumstances.

”I just want to acknowledge the difficult work the budget team had this year. It’s difficult every year but more so this year,” board Chairman Russell McCloud said. “I know this wasn’t our preference but Supervisor (Lenore) Stuart is correct, we do have a fiscal responsibility.”

The tax levy and rates will not become official until they’re formally adopted in August. This year’s primary property tax levy of about $23.7 million is $3.7 million over last year’s, and the primary property tax rate will be $2.4132, an increase of 26 cents. Yuma County also has three secondary property tax rates, including the library district’s, which is getting a 5-cent bump to $0.5983.

The tax rates for library district bond debt and the flood con- trol district are unchanged, and the county’s total combined property tax rate will be $3.5904.

Officials had to factor in about $700,000 in new funding mandates from the state, about $652,000 owed to the state public safety retirement system as a result of an Arizona Supreme Court ruling on pension reform, and projections of these and other trends which indicated the county could run out of its budget reserves by the end of the decade.

The total budget of nearly $243 million includes a general fund of $78.9 million, which is where the county’s property and sales tax revenue goes, and how most daily functions are paid for. The biggest chunks of that fund are budgeted toward medical eligibility payments ($11.4 million) and the sheriff’s department ($10.2 million).

The general fund reserve for the next fiscal year is budgeted at $10.5 million. County Budget Director Jim Flory said officials are transferring $1.2 million from reserves to balance the upcoming year’s budget, down from $2.9 million the previous year, as a result of the property tax increase.

During Monday’s meeting, District 5 County Supervisor Greg Ferguson said along with budget requirements, another statelevel change affecting county coffers is the rolling back of property tax assessment rates for commercial properties at the rate of half of one percent a year, which started in 2005 when they

were at 25 percent.

Commercial is now assessed at 18.5 percent, while residential property remains the same at 10 percent. In the last two years, the net assessed value of general commercial property in the county has dropped by $31 million through the loss of that 1 percent, Ferguson said.

It’s unknown what effect Gov. Doug Ducey’s stated intention to pursue tax reforms next year might have on the county, Ferguson added. This compounds the effect of the state mandates, he said, likening the increasing budgetary requirements to “somebody comes in once a year and opens up your cash register, and takes all the money out. It puts you in a situation where you have no

control.”

The new fiscal year begins July 1. According to the county assessor’s office, the new property tax rate will add $48.38 to the property tax bill for a $160,000 home over the previous year, assuming the value remains the same.

In other action the the board:

• Approved a $3.5 million contract with LPC Construction for the first phase of remodeling the building across the street from the main county administration building on Main Street into additional office space.

The project is budgeted at $2.8 million with a nearly $800,000 contingency fund. Funding for the project is coming from sales tax revenues pledged by the Board

of Supervisors in 2013 to pay for this project and outstanding debt for the East County court complex in Wellton.

• Authorized a contract with GovHR USA for the firm to conduct recruitment for a new county administrator, with a $20,500 fee for the first round of candidates, including advertising costs. The firm will cover all advertising costs if a second round is required, but the county may have to pay other costs.

Current County Administrator Robert Pickels is leaving July 17 to become Sedona’s city attorney. Monday’s meeting was expected to be his last with the supervisors. Jim Flory will become interim county administrator upon Pickels’ departure.