TO: Mayor Collins and Town Council Members
FROM: Kevin Burke, Town Manager
DATE: June 9, 2016
DEPARTMENT: Town Manager
Staff Contact Kevin Burke, 480-348-3690
End
AGENDA TITLE:
Title
Consideration of Resolution 2016-13 Calling for an Election to Permanently Adjust the Expenditure Base of the Town of Paradise Valley and Perform the Associated Actions
Body
Council Goals or Other Policies / Statutory Requirements:
Finance - Determine and address the expenditure limitation law.
RECOMMENDATION:
Recommendation
It is recommended the Town Council approve Resolution 2016-13 calling for an election to permanently adjust the expenditure base for the Town of Paradise Valley and perform the associated actions.
Background
SUMMARY STATEMENT:
The Town Council, in its 2015-2016 Goals, sought to address the detrimental effects the Expenditure Limitation Rule (ELR) is having upon the financial health and transparency of the Town's finances. The ELR is a State constitutional amendment that limits the expenditures of a municipality to their 1979-1980 levels adjusted for growth and inflation. This makes sense but is not the most applicable to Paradise Valley. Much of the Town's growth is associated with resorts and not population. As resorts grow and/or new ones come into Town, they increase expenditures but also provide revenues to cover those expenditures plus more. Unless the permanent base is adjusted, those expenditures cannot be made despite available revenue. Moreover, the Town's residents consist of many second home owners who actually count their primary residence in another state for census purposes. This artificially lowers the Town population.
Further, the bundle of services has changed since 1979-1980. Again, even though these services may pay for themselves, the expenditure base must be adjusted to expend those associated revenues. Lastly, the service level or service conditions have changed since 1979...
Click here for full text