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FLORENCE — Pinal County’s new annual budget may or may not continue the Board of Supervisors' goal of steadily reducing the property tax rate by four cents each year.

The county budget is on target to be balanced in the old year and new year and keep its goal of maintaining a reserve equal to 15% of spending. But if all requests are approved, the county will be spending $5.3 million above its revenues next year, and its reserve would go down to 12%, Budget Director Angie Woods told the board May 6.

Supervisors Chairman Anthony Smith, R-Maricopa, said he still wants to reduce taxes, but he’d like to see a budget proposal that delays the next tax decrease to reduce or eliminate deficit spending. “The deficit is bothering me, and also the 12%,” Smith said.

Budget Director Angie Woods said those extra four cents on the tax rate equal about $4.5 million in county revenue.

Smith said cutting the primary property tax rate another four cents, down to $3.75, remains an important goal, “but I’m not a fan of deficit spending, either.” Supervisor Mike Goodman, R-San Tan Valley, suggested the board consider cutting the rate at least two cents.

Lag in sales tax

Woods projected revenues of over $194 million at the end of the current fiscal year on June 30, which is down $4.5 million from March.

Assuming April and May have declines of 20% to 30% in county sales tax, followed by businesses reopening, “maybe June could be 90% of what last year was,” Woods told the supervisors. “We’re just trying to anticipate the changes as businesses begin to open back up.”

Supervisor Steve Miller, R-Casa Grande, noted that sales tax receipts typically follow a 60- to 90-day lag, so the county is still collecting money from January and February.

Retail makes up 4%, or about $8 million, of the county’s General Fund revenues. About 3,400 retailers submit tax payments each month; most are small. About 115 big ones — including Walmart, Fry’s, The Home Depot and auto dealerships — make up 75% of total receipts, Woods said.

Sales tax from restaurants and bars make up 1% of Pinal County General Fund revenue, or about $1.8 million. Just over half of restaurant taxes are from dine-in, “so we may be taking a significant hit there,” Woods told the board.

Homebuilding has remained steady, Woods said. For items like state shared sales tax and vehicle license tax, Woods said she assumes what’s happening locally is what’s happening statewide.

As for expenses, the county will have a $770,000 increase in public safety retirement next year and a $900,000 increase in medical premiums.

For the county’s funding for external nonprofit agencies, Woods said she assumed the figure in the new budget year would be similar to the current one. The county makes $400,000 or so in grants to local nonprofits and pays about $225,000 in memberships.

The supervisors will hear more budget forecasts at their May 27 meeting and consider requests from external nonprofit agencies. The board will then consider adopting a tentative 2020-21 annual budget on June 10.

Pinal County Manager Louis Andersen said revenue projections for the new fiscal year don’t include federal reimbursement for the county’s COVID-19 response, which the county is still hoping to receive. “I understand some money has been sent to the state, $2.8 billion, and we have yet to find out how we access that money,” he told the board.

Economic development

Andersen reported progress continues with two “high-tech manufacturing projects; two very large international companies are looking to come to Pinal County.” He further reported that Jet Yard has submitted its plans to build a 100,000-square-foot hangar at Pinal Airpark, and construction of a 1,100-acre, 100-megawatt solar farm is underway in Coolidge.

Andersen also said the Arizona Department of Revenue released its 2020 abstract for all counties, and Pinal was found to have the second-lowest net assessed limited property value, for 14 out of 15 in net assessed value.

Vice Chairman Pete Rios, D-Dudleyville, commented this is because of the majority of Pinal County is under state, federal or tribal ownership.

“I think that’s why it’s important that the state of Arizona start taking a closer look at allowing some of that land to be auctioned so we can put it on the (property tax) rolls.” He added the state has been reluctant to do this for the last decade or two.

“At the end of the day, our county is, to a large extent, at the mercy of the State Land Department,” Rios said.

Some county departments have too many under-used vehicles, and Andersen said he’s working with fleet management staff to reduce the size of the fleet in keeping with audit findings.

Codes, regulations organized

The board held a public hearing and approved a new arrangement of the county’s codes, rules and regulations into a single comprehensive volume entitled “The Pinal County Code of Ordinances.”

Deputy County Attorney Mark Langlitz told the board the volume is the result of the efforts of many people, especially Clerk of the Board Natasha Kennedy. Goodman said he noticed the need to have the county’s codes organized shortly after joining county government and commended Kennedy and other county staff for getting it done. The other supervisors also added their thanks.

The code of ordinances will be available online, and each supervisor will have a hard copy in his office.

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Mark Cowling is the county reporter for PinalCentral and covers the town of Florence, San Tan Valley and the surrounding area. He can be reached at mcowling@pinalcentral.com.

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