Mohave County presents structurally balanced FY26 budget; proposes tax-rate swap, library sweep

Mohave County staff on April 16 presented a recommended fiscal year 2026 budget that they described as structurally balanced, centered on a recommended Option B that preserves most departmental requests while relying on a set of revenue measures and one-time transfers to avoid cuts.

The proposed package includes a tax-rate swap that would reduce levies in two special districts and increase the county's primary property levy by 0.06 percentage points (neting roughly $1.6 million), a $1.25 million one‑time sweep from the library district authorized under current JLBC guidance, and a change to the county's assumed property-tax collection rate from 95% to 97%. Combined with projected growth in assessed values, staff said those measures yield approximately $5.1 million in added revenue that enables the recommended option to be structurally balanced for next year while leaving an estimated $25.5 million in surplus at fiscal year-end.

Why it matters: County leaders framed the package as a way to sustain county functions, preserve services and limit employee turnover while avoiding larger recurring tax increases. Staff recommended that the board adopt a fund-balance policy to earmark a portion of the projected surplus for future capital needs, and said they will present the tentative budget for adoption in June.

Key elements and context

- Revenues and fund balance: Staff reported a higher-than-targeted projected end-of-year general fund balance and advised maintaining a $50 million fund target that is composed of roughly 3.5 months of operating expenses plus a 10% contingency. They said the FY26 proposal would leave a projected surplus of roughly $25.5 million beyond that target, available for one-time needs.

- Tax-rate swap and district sweep: The recommended plan would decrease the levy rate in the library district by 0.04 and the TV district by 0.02, offset by raising the general-fund levy by 0.06. County staff said a penny of levy equals about $272,000. The library-sweep proposal relies on language the Joint Legislative Budget Committee has supported in recent years.

- Revenue forecasting and risks: Staff budgeted a 3.2% growth rate for state shared sales tax (based on Mohave County experience rather than statewide projections) and noted federal grants, potential Medicaid cuts and state-level policy changes as material uncertainties. The finance director cautioned that removing one of the presented revenue or expense items would likely create a structural deficit.

- Expense containment and one-time measures: In addition to revenue steps, staff included one-time reductions (for example, transfers from internal funds that have healthy balances) and held many department requests to smaller scopes so FY26 remains structurally balanced.

What was decided and next steps

Staff recommended Board adoption of Option B and asked for direction on a fund-balance designation policy for the projected surplus. The board is scheduled to consider the tentative budget in June and final adoption later that month; staff said tax rates will be presented for formal action in August per statute.

Ending

Finance staff emphasized the recommendation balances long-term sustainability with limited new recurring expense increases. They asked the Board for direction on how much of the projected surplus to designate for capital and infrastructure needs and said they would return with a tentative budget on June 2 and a final budget June 16.