Preserve fund plan shows large capital program, existing debt and proposed trailhead improvements; call timing and legal limits discussed

City finance and preserve staff outlined the McDowell Sonoran Preserve fund budget and a multi‑year capital program that includes trailhead improvements, safety work and the Rio Verde Drive wildlife crossing placeholder.

The presentation is consequential because the preserve fund carries substantial debt tied to prior land purchases and the fund’s revenue flow and planned transfers determine whether the city can both service that debt and fund new improvements over the five‑year plan.

City Treasurer Sonya Andrews summarized the fund’s revenue and debt position. She said the newly adopted 0.15 percent parks and preserve sales tax projects roughly $25 million in year‑one collections, and that the existing preserve land debt has a principal outstanding of about $149.4 million at June 30 and total remaining interest and principal through 2034 of roughly $164.3 million. The treasurer said the preserve fund was projected to have a fund balance of about $159.8 million at the end of the current fiscal year and that staff’s budget assumes the authority to call or defease debt at the earliest allowable date (fiscal year 2027‑28) as the plan allows.

Croix (presenting preserve capital projects) walked through a proposed $65 million, five‑year preserve capital program that covers completion work and upgrades at older trailheads (Lost Dog Wash, Gateway, Sunrise), parking and surface hardening projects, completion work at Tom’s Thumb and Frazee Field, safety fencing and trail repairs, and a large line item for the Rio Verde Drive wildlife crossing. Croix emphasized that older trailheads built before the last design‑standard updates lack some modern amenities such as shade and storage for volunteer needs and that many items are completion or hardening work rather than expansion.

Commissioners and staff discussed how the preserve charter language constrains what preserve funds may be used for. The city attorney noted the charter provisions that limit spending on preserved lands, the construction of new trails as depicted in approved trailhead plans, and maintenance for trailheads completed or under construction prior to the charter’s effective date. That provision was described as relevant to which trailhead improvements can be funded from preserve funds versus other sources.

Treasurer Andrews reiterated that the budget shows proposed transfers: both planned capital transfers for preserve projects and a proposed transfer for debt service used to service prior preserve‑land debt. She said the budget shows the five‑year plan contemplates paying down debt in 2027‑28 (or defeasing it in substance) as allowed by bond covenants and the make‑whole call provisions of outstanding debt.

Questions from commissioners probed fund balance timing, interest earnings and the mechanics by which the city can retire or escrow the bonds before their earliest call date; staff said these legal and technical details will be the subject of confidential legal advice to council where appropriate, but they stressed that the proposed five‑year plan anticipates carryforwards and deliberate phasing of capital work to match revenue and debt‑service obligations.

Staff committed to producing fund‑specific pages (already in the proposed budget book) and an annual treasurer’s report that will show collections and expenditures for the preserve fund, so council and the public can track how Prop 0.15 revenues are moved to separate funds and spent.