ADMINISTRATION & CONTRACT SERVICES

 

Current Situation:

• $9.9 million+ spent on administrative overhead, professional contracts, and internal services in FY2024.

• 43% increase in outsourced legal, HR, and IT costs year-over-year.

• Redundant administrative functions across departments (HR, Finance, ED, Tourism).

 

Where to Save:

• Consolidate support functions across departments (allowed under A.R.S. §9-11-952, Interdepartmental Services).

• Rebid or renegotiate service contracts every 2 years for competitive pricing (A.R.S. §41-2533, competitive sealed bidding).

• Cap consultant spending to 10% of departmental budgets unless justified by ROI analysis.

 

Estimated Savings: $1.2–$1.5 million annually.

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ECONOMIC DEVELOPMENT DEPARTMENT

 

Current Situation:

• $2.1 million annual budget; about $175K unused in FY2024.

• Overlap with Chamber of Commerce, MCEDC, and Route 66 Alliance.

• Repeated planning and marketing studies (2019, 2023, 2025) with similar conclusions.

 

Where to Save:

• Consolidate overlapping programs under one city–chamber partnership (economic development agreements).

• End redundant consultant contracts and repurpose savings for workforce and site-readiness projects.

• Require ROI reporting for all grants and incentives per A.R.S. §9-500.11 (public purpose & measurable benefit).

 

Estimated Savings: $500,000–$700,000 annually.

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CULTURE, ARTS & RECREATION

 

Current Situation:

• $4.7 million budget; ~$200K unused FY2024.

• High admin-to-program ratio; little measurable return.

• General Fund subsidizes events, murals, and “feel-good” projects with minimal attendance.

 

Where to Save:

• Shift to user-fee and sponsorship funding (A.R.S. §9-463.05 – municipal fee authority).

• Require self-sufficiency for cultural events (ticket sales, vendors, grants).

• Move recurring “pilot” or consultant-driven projects into annual review to justify renewal.

• Audit all recreation contracts and eliminate nonessential travel and equipment purchases.

 

Estimated Savings: $300,000–$500,000 annually.

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CAPITAL PROJECTS & INFRASTRUCTURE

 

Current Situation:

• Capital spending up nearly $50 million in FY2024 (Rancho Santa Fe, Beale Streetscape).

• City cash flow tied up in long-term projects before reimbursement.

• Developers not paying proportionate share for new infrastructure.

 

Where to Save / Reform:

• Adopt Development Impact Fees under A.R.S. §9-463.05 to shift growth costs to developers.

• Create Community Facilities Districts (CFDs) under Title 48, Chapter 4, Article 6, for new subdivisions (developer-funded maintenance).

• Require Public Improvement Agreements before capital outlay (A.R.S. §9-500.05).

• Freeze nonessential “beautification” projects until core infrastructure (roads, drainage) meets standards.

 

Estimated Savings: $2.5–$4 million over two years.

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GENERAL FUND RESERVES

 

Current Situation:

• Unassigned balance = $30.3 million (≈85% of annual expenditures).

• City policy target = 25–50% (A.R.S. § 42-17102 – prudent reserve standard).

 

Where to Reallocate:

• Maintain a 50% reserve; deploy excess (~$12–14M) for one-time capital improvements:

  • Street rehabilitation & paving.

  • Police/fire equipment modernization.

  • Storm drainage or water main upgrades.

 

One-Time Capital Gain: $12–14 million available immediately.
(No tax increase required.)

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PUBLIC SAFETY EFFICIENCY

 

Current Situation:

• Police and Fire combined: $20.7 million — ⅓ of all city spending.

• Annual growth of 13% without workload-based staffing analysis.

 

Where to Save / Improve:

• Conduct operational audits and implement shared services (fleet, logistics) (intergovernmental agreements).

• Require annual performance reporting tied to crime reduction and response times (A.R.S. § 39-121).

• Re-balance overtime vs. new hiring to reduce burnout and costs.

 

Efficiency Gain: $400,000–$600,000 in budget optimization (not cuts to safety).

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WATER & UTILITY OPERATIONS

 

Current Situation:

• Water Fund lost $2 million FY2024.

• Rising costs in maintenance, energy, and aging infrastructure.

• Reactive maintenance vs. predictive asset management.

 

Where to Save:

• Adopt energy efficiency programs and replace outdated pumps (SRP/APS rebates).

• Implement tiered rate structure for industrial users, not residents.

• Conduct leak detection and asset audit to reduce unaccounted-for water.

 

Estimated Savings: $800,000–$1 million annually.

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STREET MAINTENANCE & TRANSPORTATION

 

Current Situation:

• Funding patched together from general fund transfers and small taxes.

• $29.9 million pulled from reserves for roads since 2019.

 

Where to Save / Rebuild Capacity:

• Redirect unspent funds to a dedicated street preservation fund (A.R.S. § 42-17106).

• Apply for HURF and ADOT Local Transportation Assistance Fund grants.

• Prioritize infill repair projects to reduce long-term costs (per the General Plan “Growth Areas Element”).

• Stop expanding infrastructure for undeveloped land.

 

Reallocation Potential: $2–3 million annually toward roadwork.

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