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Phoenix releases proposed FY2025-26 budget; public comment, council vote set for May
Summary
City staff presented a proposed fiscal 2025–26 budget that responds to state tax changes and includes a previously approved sales-tax increase, planned capital spending for public safety and additional funding for homeless services; the proposal will be presented to the City Council May 6 and is scheduled for a council vote May 21.
Mario Paniagua, of the City of Phoenix administration, opened a community hearing on the city's proposed fiscal 2025–26 budget and asked residents to provide feedback before the proposal is presented to the City Council.
"Bienvenidos a la audiencia sobre el presupuesto... Soy Mario Paniagua, de la administración municipal de la ciudad de Phoenix," Paniagua said, announcing the proposal will be presented to the City Council on May 6 and voted on May 21.
City staff told attendees that the proposed budget is built around three main fund types: the general fund, enterprise (business) funds and special revenue funds. The presentation described the general fund as supporting core services including libraries, parks, youth and senior programs, police and fire; enterprise funds as self-supporting utilities such as water and solid waste; and special revenue funds as monies dedicated by voters or grantors for specific purposes such as parks and transportation.
Staff outlined a set of financial pressures and planned responses. The presentation said recent state actions will reduce local revenue: the state removed local authority to collect a tax on residential rental income starting January 2025 and reduced the individual income tax rate. To respond, the proposal relies on a mix of strategies described in the hearing: use of projected special-tax revenues for capital projects, reprioritizing general-fund expenditures to reduce costs, reserving projected resources to buffer future budgets, and using special-tax revenue for large capital and public-safety projects.
The presentation noted a prior City Council action on taxation: on March 18 the council voted to increase the transaction privilege tax (the city's sales-tax equivalent) from 2.3% to 2.8%, effective June 1, 2025. The presentation said revenues from that increase will be used to support programs and services and finance major capital and public-safety projects, including two new fire stations and additional apparatus and equipment.
On service-specific items, the staff presentation identified additional funding proposals for the Phoenix Fire Department to reduce emergency response times, including hiring staff for existing and new stations and funding equipment. The presentation also referenced funding for the Office of Homeless Solutions, saying the proposal includes "4.5 1000000" of general fund resources for the office for 2025–26; the meeting record provided did not specify the precise dollar formatting or confirm whether that phrase denotes $4.5 million.
Staff emphasized the role of public comment in shaping the final proposal and described the process timeline: outreach during April, presentation to the City Council on May 6, a council vote on May 21 and adoption steps in early June when the ordinance that sets the property-tax rate will be finalized.
No formal motions or votes on the budget were recorded in this hearing; the presentation was a public outreach session. The transcript included the March 18 City Council vote on the transaction privilege tax increase but did not include a vote roll call or mover/second details in the provided record.
The hearing material urged residents to submit comments in person, by phone, email or social media during the outreach period so the City Council can consider them before the May 21 vote.
