Cochise County outlines FY26 baseline budget, recommends $1.18M for market adjustments

Cochise County staff presented the county's FY26 baseline budget and revenue assumptions at a May 14 work session of the Cochise County Board of Supervisors in the Supervisor's Hearing Room in Melody Lane.

The budget presentation noted projected general fund revenues of about $109,000,000, and recommended setting aside $1,180,000 for market adjustments and $1,210,000 for department funding requests. County staff said those allocations represent the portion of revenues available within the baseline without increasing taxes beyond the board's tentative levy decisions.

The county's revenue assumptions include modest increases in property values, a county half‑cent sales tax forecast of $10,000,000, state shared transaction privilege (TPT) receipts estimated at $18,000,000, and a flat vehicle license tax (VLT) projection. County staff reported that the proposed levy calculation produced a levy total of $31,120,242 and discussed a resulting property tax rate around prior years' levels (staff cited historic rates such as 2.6747 as points of comparison). Staff emphasized that the board cannot increase the rate after adopting a tentative budget.

Stacy (county staff leading the presentation) summarized the countywide picture and said staff rolled forward the amended personnel budget from FY25 into FY26 to reflect current positions, prior market adjustments and outstanding funding requests. The presentation also called out voluntary operating reductions from departments and a modest reduction in the solid‑waste fleet charge of roughly $200,000.

Supervisors and staff discussed the county's market plan for employee pay. Staff presented multiple past market increases (examples cited: $1.0M, $1.8M, $2.1M in prior years) and said the recommended FY26 market allocation would keep Cochise County below full market but continue incremental progress toward competitive pay. Supervisors also described a prioritization approach for handling vacancies: classify positions on a 1–5 criticality scale and consider attrition or automation for lower‑criticality positions while replacing high‑criticality roles.

Other budgeted items and risks discussed: - ALTCS/long‑term care contribution: staff showed a $922,000 projected contribution based on current JLBC guidance but noted the final state share will not be known until the state budget is finalized. - PSPRS (Public Safety Personnel Retirement System): staff included an additional $5,000,000 payment for unfunded liabilities in the proposed budget, continuing a multi‑year supplemental payment strategy. - Audit and ERP (enterprise resource planning) work: staff proposed $80,000 in expanded financial consulting services to assist finance during ERP implementation and discussed the board's interest in a deeper operational audit after ERP go‑live to identify redundancies or inefficiencies.

Staff flagged multiple external uncertainties that affect the tentative FY26 plan: the ongoing state legislative and federal policy environment (including potential Medicaid changes), the outcome of litigation and ballot timing for the jail district half‑cent sales tax, and timing of large construction projects (for example, a port‑of‑entry project that could temporarily boost local prime‑contracting sales tax receipts).

Board members requested additional detail and follow‑up on some line items (for example, departmental revenue changes in health and the flood control district cash carryforward). Staff said the schedule remains: tentative budget presentation in June, followed by the statutory truth‑in‑taxation and final property‑tax‑rate adoption schedule in July–August.

The board set follow‑up work sessions and asked staff to supply refined numbers and appendices ahead of the tentative budget vote.