Growth drives big budget increase for QC

Queen Creek’s extraordinary growth is driving a significant increase in spending for the fiscal year beginning July 1 with three-quarters of it going to infrastructure. (Tom Sanfilippo/Inside Out Aerial)

Queen Creek Town Council on May 4 approved a tentative $730.3 million budget for the fiscal year beginning July 1 that the administration called necessary to meet the town’s soaring population’s needs.

The 4-2 vote came with council members Emilena Turley and Leah Martineau voting against the spending plan and Mayor Gail Barney absent.

The proposed spending plan – slated for a final council vote May 18 – is significantly higher than the town’s current $487 budget as town administration proposed major investments in infrastructure and expanded services. However, there is no tax increase.

Town administration had signaled the need for those expenses at an April 13 budget committee meeting, when Finance Director Scott McCarty said, “The story of the budget like everything else in Queen Creek is a story about growth.”

Queen Creek’s population grew by 125.8% over the past decade, according to the Maricopa Association of Governments.

“We don’t foresee the growth slowing down,” McCarty said.

Arizona is forecast to grow faster than the U.S. average for the next fiscal year, Town Manager John Kross said at that meeting.

“The rate of growth in both residential and non-residential investment is directly related to the infrastructure needs to service this growth and position the town competitively,” Kross wrote in his presentation of the budget. “Roads are priority No. 1,” he said.

As the town has grown, its revenues have become “less reliant on single-family home permitting (fees)” than in the past, he said. The town now has a “more diverse tax base.”

The proposed budget calls for a 23% increase in projected revenues and 50% increase in expenses.

“Savings from prior years is making up the difference (between the revenues and expenses),” said Constance Halonen-Wilson, town public information officer.

Besides infrastructure, another big expense item in the upcoming budget is the proposed hiring of 64 new positions – including 43 for public safety.

The budget includes 15 new positions in the police department, another 26 new positions to begin an ambulance service in the Fire and Medical Department and two new staff positions to assist with that department’s administration.

“Increased revenues for the FY 2022-2023 are expected as a result of population growth, the overall economy and new businesses,” Halonen-Wilson said. “With the increased revenues, the town is able to evaluate the additional staffing needs.”

The additional number of staff in the Fire and Medical Department means its cost of salaries and fringes to $15.5 million for the coming fiscal year, compared to $11.2 million currently for a total increase of $4.33 million – an increase of 39%.

The new emergency transport service is budgeted at just over $3 million.

Police services salaries and fringes costs will increase from $9.8 million to $13.1 million for a total increase of $3.3 million, or 34%.

The proposed budget also recommends $500,000 for a new public safety police facility. Halonen-Wilson said this expenditure is “a placeholder related to an evidence storage facility for the police department. We currently contract with Gilbert for evidence storage.”

The town also has a five-year plan for its road construction.

The transportation infrastructure improvement fund includes a $3.4 million expenditure in the FY 2022-2023 budget. The town budgeted $3,081,300 in its FY21/22 budget.

The Parks and Recreation budget includes $136 million for completion of Mansel Carter Oasis Park, construction of a new 85-acre park in the northeast section of the town, and the design and construction of a Recreation Center and Aquatic Center.

The park expansion will be paid for by a $138 million bond sale, which will not increase resident’s taxes, McCarty said.

The committee approved the budget to recommend to the council for action, with an amendment presented in committee of $23 million for a potential acquisition of park land.

At the council meeting last week, Kross said the fact that 73% of the budget would be spent on infrastructure “speaks to how much is left to be built in Queen Creek. We’re only about halfway there. Still a lot more to do.”

“Growth projections are absolutely critical for Queen Creek,” he said. “It identifies the location of new infrastructure.”

McCarty said the “operating budget pays for all government services. The revenue drivers are population growth in Queen Creek, and what is going on in the area, the economy and business.”

All the council members shared their opinions of the spending proposal.

“I don’t enjoy voting ‘no’ on some things or even the budget because really I agree I support most of it,” Martineau said. “So that’s where it gets tricky. But there’s just a few things, a few areas I just can’t get behind.”

He said those included the new aquatic center, expanding ambulance services and “subsidizing” Horseshoe Park.

“We’re at the local level,” Martineau said. “But we can also look at the federal level. We know they’re out of control and undisciplined.”

She said people are feeling the “effects of what’s happening,” such as rising costs for gas, food and housing.

“We are all feeling that, living that. I do believe that’s kind of the beginning of things.” Martineau said. “I do believe it’s going to get a little bit worse before it gets better.”

Last year the town’s budget was $487 million and “now we’re looking at passing a budget at a 50 percent increase, yet growth is 10 percent,” she added. “That’s a little bit concerning for me.”

Turley said the town “has so much to be proud of” such as the launching of the new police department and parks but wanted to speak to the “elephant in the room.”

She said she is concerned about the spending on the parks “in a time of economic unrest.”

“The price tags for the multi-gen center and aquatics center of $40 million and 25 million plus the maintenance concerns her. This budget proposes spending $157 million on parks –it’s a bit much for me.”

She spoke of the recent tax levy, which she would like to see lowered. With a surplus in the budget of $22.8 million and yet the tax levy takes $12.5 million from property owners. “Is it time to lower that tax for the residents? I won’t support this budget.”

But Councilman Robin Benning said, “The budget seems so big because we’re spending money on building roads,” on water infrastructure and the “residents have been clamoring for parks and we’ve been under-parked.”

Councilwoman Dawn Oliphant said she is “very happy parks are finally a priority, because in past years the town has had to spend so much on building roads.”

“This is a healthy budget,” she added, that includes a “great savings account.”

Noting property taxes only cover 24 percent of the cost of providing for public safety, she said it is not just the residents who pay the sales taxes but also shoppers who visit Queen Creek.

Councilwoman Julia Wheatley said she would “challenge” her colleagues who voted against the budget “to find a baseline we agree on.”

She said she “would love to get to that point” where the town could lower the tax rate but budget documents show that 73 percent of spending has to pay for infrastructure.

Vice Mayor Jeff Brown said he supports the tentative budget that sets a ceiling on spending.

He thinks the town will be able to lower the property tax again in the future as large employers, like lithium battery manufacturer LG Energy Solution are in operation and are paying a living wage.

That will put “another leg under our stool,” Brown said. “With a diversified revenue stream, we can provide the services and amenities the residents are asking for all the time without relying on property taxes.”