Buckeye presents $552.7 million FY‑26 recommended budget; council to consider tentative adoption May 20

The city manager’s FY‑26 recommended budget of $552,700,000 was presented to the Buckeye City Council on the workshop agenda, with staff outlining revenue sources, spending priorities, and a proposed five‑year capital improvement plan.

The budget matters because it funds ongoing services, new positions and one‑time capital projects; staff said the plan relies on continued retail and construction sales‑tax growth and includes a $75 million geobond tranche planned for streets and public safety projects.

Budget Manager Greg Litchi summarized the proposal: “Today, we're here to review the city manager's FY 26 recommended budget at $552,700,000.” He told council that the package combines ongoing operations with a large capital program and that the $552.7 million figure represents new FY‑26 funding and does not include FY‑25 carryovers that will be added at the tentative budget.

Staff showed the revenue mix and major spending categories. Transaction privilege tax (TPT) was presented as the largest revenue source at about $101.7 million, followed by enterprise utility fees (about $75 million) and intergovernmental revenues (about $69 million). Staff said roughly $67 million of prior fund balance is illustrated to help fund the CIP and that about $75 million of geobond borrowing is included in current planning.

On the expenditure side, capital outlay was the largest category at about $180.9 million, personnel services about $140.6 million, and operating expenditures about $150.2 million. Debt service and contingencies were increased to reflect geobond debt service and impact fee contingencies; staff also said $15 million was set aside in a budget authority fund to allow flexibility if unanticipated revenue is identified during the year.

Staff described assumptions and risk: a 9 percent conservative retail TPT growth assumption for FY‑26, a smaller construction TPT projection (with recent softening in some home sales), and a 9.3 percent increase in net assessed value that produced a slight decline in the primary property tax rate to about $1.6004 per $100 of assessed value. Litchi said state‑shared revenues were expected to be roughly flat with modest increases and that permitting revenues were projected at $19.2 million (about 2,400 permits) based on historical averages.

Council members asked whether the permitting estimate reflects specific upcoming subdivisions; an unidentified council member asked how the forecast accounts for large developments coming online. Litchi replied the projection is “based on averages and historical data” and that staff will refine forecasts when more project‑level data is available.

The recommended staffing and compensation elements include 67 new positions (37.5 full‑year equivalents and 29.5 midyear starts), a 2.5 percent cost‑of‑living adjustment for all staff, a new 1 percent deferred compensation contribution, a 4 percent merit pool for non‑public safety employees and step increases for represented public safety staff. The budget also includes a $1,000,000 payment to reduce the police unfunded pension liability.

Councilman Breonker thanked staff for what he called a straightforward presentation. Council discussion emphasized conservatism in revenue projections and contingency planning; staff noted a contingency of about $30,000,000 and said one‑time CIP projects can be delayed if revenues soften.

Staff highlighted budget highlights including an asset management program with $13 million initially budgeted (for technology, facility and vehicle replacement and water resources), public safety hires (six patrol officers and two sergeants split between fiscal and midyear starts; three fire captains and three battalion chiefs), an arts and culture master plan ($100,000) and several master plan updates and public‑safety technology items. Grants shown included Arizona Lottery funds, federal ARPA for a White Tanks recovery well ($12 million) and other awarded grants; total budgeted grants for FY‑26 were shown at about $43.6 million.

Staff presented the calendar for adoption: tentative budget adoption at the May 20 council meeting, the Truth in Taxation hearing and adoption on June 3, and final adoption of the property‑tax levy on June 17. Litchi reminded council that the FY‑26 numbers will be updated at the tentative budget to include carryovers from FY‑25.

Next steps: staff will return with a tentative budget that incorporates FY‑25 carryovers and refinements to revenue and project lists; council still must hold the truth‑in‑taxation public hearing and adopt the final levy and budget.