The COVID-19 pandemic has definitely thrown a wrench into many plans, including how the Town of Oro Valley handles its budget. But there’s good news for our community: Oro Valley is on track to close out the current fiscal year on budget. We’re also set to handle any bumps from the national and state economic downturn with minimal effects on services.
Our fiscal year kicked off on July 1, and up until recently, sales tax collections were booming. We were even expecting a 10% increase by the year’s end. Like many others, we’ve had to make some changes, such as implementing a hiring freeze in March, which left seven positions vacant. Two more are expected to open before the fiscal year wraps up. These roles will remain vacant through the end of 2020, as outlined in the FY 20/21 Town Manager’s Recommended Budget. You can check it out on the Town’s website if you’re interested.
With a solid plan, a great team, and careful spending cuts, this budget reflects what resources we expect to have next fiscal year amid the COVID-19 crisis. Our first priority is to meet the goals in the Town Council’s Strategic Leadership Plan for FY 2019/20 – FY 2020/21.
We’re looking at a 3% or $1.2 million drop in revenues for the General Fund from the previous budget. This includes a 6% dip in sales taxes due to lower consumer spending. However, state shared revenues will rise by 5%, thanks to strong income tax collections from two years ago, which helps offset our losses. We’re also anticipating a 21% drop in licenses and permits because of a slowdown in construction.
Operations and Maintenance costs have been trimmed by 11.5% from last year’s budget, saving about $1.2 million. Our directors worked to find budget cuts that would have the least impact on services.
Residents often worry about public safety, parks, and roads. I’m happy to say that all positions in the Police Department are funded, along with replacing the aging emergency communications/911 center consoles. We’ve also allocated funds for some road projects and set aside $1.5 million in the HURF Fund for pavement preservation. Excitingly, there’s $550,000 earmarked for renovating the old garage at Steam Pump Ranch to make it a permanent spot for staff, keeping this historic site open daily.
We’ve also planned the use of $2.3 million in excess reserves, with $900,000 aimed at capital projects. The rest will help avoid more cuts in the General Fund.
The Town has a healthy reserve in the General Fund, above the 25% Council policy. We’re projecting $4.7 million available for next year as part of a $5 million contingency. This reserve will help us manage any further economic impacts or unexpected expenses.
To tighten our belts, we’ve paused step/merit increases and a planned market adjustment for employees, saving over $500,000 in the General Fund. This move helps us avoid layoffs or furloughs, which is great news. As the economy begins to recover, we hope to reinstate these benefits.
The FY 20/21 Town Manager’s Recommended Budget is a well-thought-out plan aligning with our community’s expectations and Town Council’s priorities. You can find the full budget on the Town’s website. But remember, the budget process isn’t over yet. Council will hold study sessions, and there are two chances for public input before adoption. Public Hearings are set for June 17 and July 15 at 6 p.m. via Zoom. Details on participation are available on the Town’s website.
We welcome your questions and comments through our AskOV service. You can reach us by clicking the blue Ask Oro Valley button on our website, emailing [[email protected]](mailto:[email protected]), or calling 520-229-4711. Your feedback goes straight to the Town Council and leadership staff.
Mary Jacobs is the Oro Valley Town Manager.
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