Pinal County’s ’22-’23 budget to top $1 billion for the first time

Richard Urban

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By Richard Urban / NewsBreak Pinal County, AZ

The fiscal year 2022-’23 budget that Pinal County supervisors will consider on July 6 will top $1 billion for the first time in county history, but those numbers can be misleading, board of supervisors chairman Jeff McClure said.

“It is the first billion-dollar budget, but it really isn't as big as it looks,” he said.

While the budget anticipates a $282.5 million increase over last year, that increase stems from grant funding, bond revenue for economic development, and bonds to put the county Arizona State Retirement System pension plan on a more solid footing. Additional funds come from retired debt.

“While it is a big number, it is not that you're looking at it and going ‘Oh, my gosh, we've been taxed to death,’” McClure said. “We dropped the tax rate. That large number is from federal grants and from the bonding issues that we have going at the moment.”

He said the tax rate is set as low as possible while providing the means to deliver the services that constituents demand.

“We need to operate the county in an efficient, effective manner to be able to provide services for constituents that are necessary for the safety and maintenance of the county,” McClure said.

Property Taxes

Even as the median home sales price in Pinal County is up nearly 31 percent from a year ago to $412,300, the property tax rate for the fiscal year that begins July 1 will decrease by about 3.5 percent.

Because $103 million of new construction was added to the tax rolls and property valuations increased by $280 million, the county is able to lower the tax rate and still raise about the same amount of money as last year, with enough added revenue to account for inflation and the increased costs of providing services.

“The county portion [of the property tax bill] should be very similar to what it was last year,” Chief Deputy Assessor John Ellinwood said of the county’s portion of overall property tax bills. “There are new subdivisions, new homes being built. So, there'll be additional revenue that will come in from those. The county still gets what it needs to run, even with increased costs, but individual homeowners are not hit too hard, because the new homes are now on the rolls.”

Planning for Contingencies

The budget also tries to anticipate growth as people and businesses continue to find their way to Pinal County. Between July 2020 and July 2021, the population grew from 425,264 to 449,557, a nearly 6 percent increase, according to the Census Bureau.

“It's great for us that we're that we're on the forefront of this giant growth, but we have to be very mindful that there's possibly a recession in the next year, year and a half,” McClure said.

Noting that the Great Recession of 2008 reduced the county’s income to the point that it laid off hundreds of employees and struggled to pay its bills, McClure said that the county has been building a reserve fund to be in better position to weather an economic downturn.

“With that reserve fund, we don't have to let employees go. We can still provide services. We can still pay our bills,” he said. “We're trying to be very fiscally, conservatively conscious about those kinds of things. We don't want to have too much money just stacked up. But at the same time, we want to have enough money in case something happens so that it doesn't just throw a wrench in our works.”

Breaking down the Budget

Property taxes fund 21 percent of the budget, state and federal grants 25 percent, and sales taxes 19 percent. Vehicle license taxes, highway fees, and user fees for services account for 15 percent. Fines, forfeitures, licenses, permits, and miscellaneous revenues add up to 20 percent.

The budget anticipates total revenues of $553 million, not including bond proceeds of $188 million, and a balance of $276 million carried over from last year’s budget, according to Angie Woods, director for the Office of Budget and Finance.

Spending totals $520 million, excluding any spending resulting from bond revenues and money set aside for contingencies, she said.

“Of the $520M, approximately $228M is planned general fund expenditures,” Woods said. “The general fund pays for the core activities and services of the county.”

Its funding comes from property taxes (39 percent), state and federal revenue sharing (28 percent), county sales taxes (10 percent), and fines, forfeitures, user fees, licenses, permits and other miscellaneous income (23 percent).

The general fund allocates 30 percent for general government expenses, 29 percent for the sheriff’s department, 15 percent for county courts, 13 percent for legal expenses including the county attorney’s office, 11 percent for health services, and 3 percent for social services and other expenses.

“Always keep in mind that a budget is a ceiling,” McClure said. “It is not what you actually spend. It's not like your household budget where you say, ‘Well, I've got this much money, how do I spend it?’ That's not the case in government.

“Because we're taxing authority, we need to have the ability and the permission to be able to spend so much even though we may never get there. We have the ability to spend those dollars if need be. That does not mean we are going to spend it all. That means we have those funds available. And we try not to, of course, if we can help it,” he said.

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Richard is an award-winning journalist with more than 40 years experience in newspaper and magazine publishing. He has covered topics that include local and state government and politics, courts and crime, environment, business and innovation.

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