Queen Creek presents $682.7 million recommended budget, emphasizes infrastructure and tax relief

Town Manager Bruce Gardner and Chief Financial Officer Scott McCarty presented the town manager's recommended fiscal year 2025-26 budget to the Queen Creek Town Council on April 8, proposing a $682,700,000 budget that the presentation says is balanced "as required by state statute." The recommended plan dedicates just over 52% of the total to infrastructure, with the largest shares assigned to transportation, public safety, and water and wastewater projects.

McCarty told the council the budget continues the council's policy of a property-tax freeze for a third consecutive year and incorporates the full reduction from a sales-tax measure the council repealed last year. He said the recommended total is approximately 6% lower than the prior year and that staff took a conservative approach because of economic uncertainty, changes in state tax policy and an unresolved assured-water-supply issue affecting single-family housing growth.

The administration highlighted several financial priorities that shaped the document: maintaining credit ratings (targeting double-A-plus with a long-term aim of triple-A), continuing pension funding, sustaining a 25% operating reserve policy and managing growth in personnel costs driven largely by public safety. McCarty said the town expects to carry roughly $131 million in total fund balance at the end of the budget year, of which about $107 million will be reserved for the council's policies and $23.2 million will remain available for one-time uses.

Staff flagged two revenue effects that reduce the amount of new recurring dollars available this cycle: a multi-year slowdown in single-family home permits because of assured-water-supply constraints, and a lower share of state income-tax distributions after changes enacted at the state level. Those items together reduced recurring revenue available for ongoing services by several million dollars compared with earlier forecasts, McCarty said.

The recommended budget also continues the town's "pay-as-you-go" infrastructure discipline and applies a policy to hold construction-sales-tax receipts above $10 million as a reserve rather than adding the full amount to ongoing operations. McCarty said the town will continue work this summer on water and wastewater rates, including a previously approved 15% rate increase that will return to council with a public hearing.

Mayor Wheatley and the council had no final action on the budget at this meeting; staff said additional memos will summarize follow-up items before the council considers a tentative budget on May 7.

Votes at the meeting: the council voted to approve the minutes of the April 8, 2024 budget meeting earlier in the session. The motion, made by Councilmember McClure and seconded by Councilmember Brown, passed 5-0 (members on the line were recorded as present).