Payson council work study reviews FY26 draft budget, hears sharp debate over pool funding and staffing

Payson staff presented a draft fiscal 2025–26 budget at a May 6 work-study session that projects general-fund revenues roughly in line with planned expenditures and leaves limited uncommitted fund balance for new capital projects. Councilors spent much of the meeting debating priorities — including whether to fund a municipal pool, how to address rising personnel costs, and what capital projects to advance — and asked staff for additional analysis before finalizing the town’s expenditure limitation later in May.

Town finance staff told council the general fund projections show about $35.9 million in revenues against about $35.5 million in expenditures in the draft; the town expects an unrestricted general-fund balance of roughly $16 million this year, of which a $10 million policy reserve leaves about $5.9 million available for one-time uses. Staff said those available funds, combined with other sources such as HEERF and water funds, constrain what the council can commit to new capital projects without reducing reserves or increasing tax or fee revenue.

Council members pushed back on both revenue assumptions and new spending. Councilmember Charlie Bell called for sharper scrutiny of consultant, attorney and temporary-staff fees and urged the group to identify which services to preserve. "We really need to evaluate what's happening with this budget," Bell said. Several members raised the same theme: personnel and benefits are the budget’s largest share and are the main drivers of the projected equilibrium between revenues and expenses.

Pool debate and capital priorities

A large portion of discussion focused on a possible aquatic center. Councilors and staff discussed plans under study and whether the town should commit general-fund dollars now to design and construction. Staff said a conceptual scoping process is ongoing and that the design team will return with a preferred option in a future meeting; council members said they need cost and financing scenarios before committing major dollars. "If we come back and the design isn't anything that we really want, what do we do? We start all over again?" one council member asked.

Council members differed on tradeoffs. Some favored prioritizing revenue-generating projects and repairs to existing assets — citing the event center, improvements to Ramsey Park and Green Valley Parkway among examples — while others argued for moving ahead on the pool if a feasible financing plan (bonds, grants or other sources) can be identified. Staff advised that committing the entire available fund balance to a single project would leave little room for other projects or for borrowing capacity.

Staffing, personnel costs and the hiring pause

The draft shows personnel costs are 74% of general-fund expenditures. Councilors pressed staff for scenarios to reduce ongoing operating costs and asked about pausing hires or narrowing vacant positions that are not essential. Town leaders said they plan to hire a permanent town manager soon and recommended that detailed staffing reorganizations or position eliminations be coordinated with that new manager. Several councilors asked staff to return with targeted scenarios (for example, a specified dollar target such as $500,000 or more in savings) showing how reductions could be achieved without undermining core public safety services.

Transit and other items

Council also received an update on the Bee Line transit service the town assumed from the senior center in 2023. Staff reported ridership growth since the town took over (about 9,000 rides in 2024) and said FY24 operating costs were about $362,801; the Arizona Department of Transportation reimbursed roughly $241,758 of that amount and local partners contributed about $83,000 toward the required local match, leaving the town’s FY24 share near $38,000.

Next steps

Staff recommended the council adopt a tentative expenditure limitation at the May 28 meeting and continue line-item review at a June 3 work session. Councilors asked staff to return with: (1) clearer, itemized options for reducing ongoing expenditures by a target amount, (2) the full pool-cost and financing analyses when available, and (3) additional detail on capital requests and grant timelines. Because the May 6 session was a work study, staff emphasized no formal budget votes were taken at that meeting.