Lake Havasu City Council members debated May 15 whether to dedicate more ongoing vehicle-license-tax (VLT) revenue to roads or preserve flexibility for annual budget choices as the city ramps pavement-preservation work.

Finance staff explained the current practice: the city puts VLT receipts into the general fund and transfers 20% to street uses; across the last four fiscal years that approach and additional general-fund transfers have averaged roughly $6 million per year flowing to streets-related work, Olson said in response to council questions.

Council Member Nancy Campbell urged a stronger, multi‑year commitment to residential roads and pavement preservation. “We could definitely do a better job on infrastructure packages by improving … residential roads,” Campbell said. She pressed staff and colleagues for certainty, arguing that pavement preservation and street maintenance require predictable, recurring funding to avoid growing deferred maintenance.

City Manager Knudson and staff said the administration favors retaining flexibility. Knudson noted the city must avoid funding ongoing operating costs with one-time revenues and reminded the council the budget must account for project management capacity, procurement timelines and contractor resources even when funds are available. Staff said $2 million of one-time funds was identified in the FY26 budget package for a pavement-preservation program beyond routine HEERF allocations; staff also said they had sent staff to road labs and examined new preservation techniques and materials.

Council members raised the scale of the challenge: staff and council referenced roughly 440 miles of road in the city and noted residential streets have not yet been extensively funded in the CIP compared with major arterials. Campbell urged that more VLT be dedicated to streets rather than flowing through the general fund; other councilors favored keeping VLT available for the broader general fund so the city can respond to personnel and other recurring needs.

Ending: Staff said they will return with a pavement-condition assessment to guide project selection and a recommended funding plan; council members said they would weigh options for dedicating more recurring funds to street maintenance during the upcoming budget hearings.