2026 Florence Forward

Florence Forward

1.5 – Cent Sales Tax Initiative

Florence Forward

Hunt Highway & Felix Rd.

Reliable Funding For Roads & Essential Services Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Florence Forward

1.5 – Cent Sales Tax Initiative

Why Is This Conversation Happening?

Florence’s financial landscape has shifted in recent years: The 2020 state prison closure reduced Florence’s population by approximately 3,000 residents, a 10% decrease, and resulted in an estimated loss of more than $3 million across the General Fund, Vehicle License Tax (VLT), and Highway User Revenue Fund (HURF)

The purchasing power of state transportation funding has declined by nearly 60% since 1990 due to inflation.

Diminishing Purchasing Power FY 1990 – FY 2025 $1.00

1990 Purchasing Power of $1

The incorporation of San Tan Valley is projected to reduce Florence’s revenues by another $1.5 – $1.7 million annually

Construction costs have risen 150% – 300% over the past 35 years

$0.80

$0.60

$0.40

$0.20

$0.00

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Jul 1995 $0.86

Jul 2000 $0.75

$11.9 billion in HURF purchasing power lost to inflation from FY 1990 to FY 2025 Jul 2005 $0.67

Jul 2010 $0.60

Jul 2015 $0.55

Jul 2020 $0.50

Jul 2025 $0.40

Florence Forward

1.5 – Cent Sales Tax Initiative

Transportation Funding Gap

$150M – 10 Year CIP Plan

$37.4M 10 Years of Current Funding

$31.6M

Fees on New Homes & Developments (DIFs)

$27.5M 10 Years of New Sales Tax Funding

$10.0M

Grants & Private Partnerships

$43.4M Unfunded Projects

Without the proposed sales tax funding, nearly half of the Town’s 10-year transportation plan ($71 million) would remain unfunded.

This initiative reduces that gap by $27.5 million, allowing Florence to advance more projects sooner and helping reduce long-term costs driven by inflation.

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Florence Forward

1.5 – Cent Sales Tax Initiative Planned Road Improvement Projects ($56.5M) A. Hunt Hwy. – Franklin Rd. to Magic Ranch Widening Project ($7.2M) B. Attaway – Palmer Rd. to Hunt Highway Widening Project ($6.45M) C. Hunt Hwy. and Attaway Intersection Improvements ($500K) D. Hunt Hwy. – Felix Rd. to SR 79 Design Concept Report ($9.2M) E. Hunt Hwy. / SR 79 Intersection Signal ($2.0M) F. Main St. Ext – Ruggles Rd. to SR 79 Widening Project ($3.3M) G. Plant Rd. – Adamsville Rd. to Hunt Hwy Road Construction ($10.3M) H. Adamsville Rd. – Main St. to Town Limits Road Improvements ($9.85M) I. Centennial Park Ave. – Adamsville Rd. to SR 287 Road Construction ($2.0M) J. Butte Ave. Bridge Replacement (East of SR 79) ($3.15M) K. SR 79 – CAP Canal to Butte Avenue Design Concept Report ($2.5M) At a modest 5% annual inflation rate, delaying these projects just three years could increase total costs by more than $10 million.

A

Project Area Proposed SR 505

K

Central Arizona Parkway Road Improvements Planning Report

E

Intersection

D F

C G

B

´ 1

0.5

0

J

H 1 Miles

I

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Legend

© OpenStreetMap (and) contributors, CC-BY-SA

Florence Forward

1.5 – Cent Sales Tax Initiative

Finding Our Way To Solutions Town Council is considering a proposal to increase the local sales tax rate by 1.5 percentage points.

Of that amount, 1% would be dedicated specifically to road widening and transportation improvement projects, while the remaining 0.5% would support the General Fund, helping maintain essential services like parks and recreation, senior services, and public safety.

How much?

Over 10 years, this would generate $27.5 million dedicated to street capital projects and $13.7 million to the general fund.

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Why Adjust the Sales Tax? Adjusting the local sales tax creates a balanced funding approach that: • Allows residents, visitors, and commuters who shop or dine in Florence to help support the transportation system without placing the burden on groceries, gas, or other essential needs • Maintains flexibility in a changing revenue environment.

1.5 – Cent Sales Tax Initiative

Florence Forward

BEFORE EGGS

$5.00

$5.00

$2.99

$2.99

$12.00

$12.18

1 DOZEN EGGS

AT THE PUMP PER GALLON

FAST FOOD MEAL

RETAIL PURCHASE GRILL

AFTER

$500

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

$507.50

1.5 – Cent Sales Tax Initiative

Florence Forward

Florence by the Numbers

Tax Rates Across Arizona Florence (Current) Casa Grande Surprise Queen Creek Apache Junction Maricopa Avondale Goodyear Marana Oro Valley Phoenix Prescott Valley Buckeye Coolidge Eloy Florence (Proposed) Benson Cottonwood Sedona Payson Kearny Mammoth Superior 0

0.25

0.5

0.75

1

1.25

1.5

1.75

2

2.25

2.5

2.75

3

3.25

3.5

3.75

4

4.25

STATEWIDE The median local sales tax rate in Arizona is 2.95%. Florence currently charges 2%.

The proposed rate of 3.5% would align Florence with other small and rural Arizona communities that have more limited commercial and retail tax bases.

• Communities such as • Smaller communities often • Florence’s proposal reflects Eloy, Benson, Cottonwood, rely more on local sales tax the financial structure and Sedona, and Payson because they do not have infrastructure needs of operate at or near this level. the same volume of largecommunities our size. scale retail activity as major metro cities.

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

1.5 – Cent Sales Tax Initiative

Florence Forward

Avoiding Costly Delays construction cost index Posting Date: 11/18/2025

CONSTRUCTION COST INDEX (Posting Date: 11/18/2025)

3.25 Base Time Period: FY 2016 Index = 1.00

3.00 2.75 2.50

2.44 2.30

CCI (No Unit)

2.25

2.25

2.00

FY 2026, Q1 = 2.17

1.88

1.75

1.50 1.44

1.25 1.00 0.75 2015

1.44

FUEL TAXES FLAT. CONSTRUCTION COSTS RISING. State fuel taxes, which help fund local road projects, haven’t increased since 1990, while construction costs have surged over the last 35 years: • Asphalt up 317% • Aggregate up 311% • Concrete up 249% • Steel up 143%

1.33 1.12 1.00 2016

2017

1.05

2018

2019

2020

2021 TIME (Fiscal Year)

2022

2023

2024

2025

2026

illustrative project cost impact

NATIONWIDE INDUSTRY TRENDS Phoenix and the rest of Arizona have outpaced the U.S. in construction spending.

It is also the top growth market in the U.S. for manufacturing construction.

State Route 24: Ellsworth Rd. to Ironwood Dr.

+135% INCREASE

$66.5M FY 2021

$156.7M FY 2024

Since FY 2021, the cost to construct the new freeway on SR24 has increased over 135%.

Funding shortfalls on Florence’s projects could increase costs in a similar way, which would further delay critical widening and road improvement projects.

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Florence Forward

1.5 – Cent Sales Tax Initiative

Follow the Money 1.5 cent sales tax tracking Arizona Department of Revenue

collects all

sales tax revenues.

CIP Budget (Capital Improvement Plan) Directs future projects and outlines how they are paid for.

Monies are deposited into the General Fund (funds are received in a lump sum payment from the State)

The transportation portion attributable to the sales tax increase would be moved to a dedicated Streets Sales Tax Fund, restricted only to street projects and maintenance.

Learn more at www.florenceaz.gov/2026-sales-tax-initiative

Street Sales Tax Fund

Florence Forward

1.5 – Cent Sales Tax Initiative

Commitment to the Future

Florence Forward is about responsible planning and long-term stability.

By strengthening our own funding capacity, Florence can: Reduce reliance on shifting state revenues

Deliver critical road projects before costs climb higher

Protect essential services

Position the community for responsible growth

Reliable Funding For Roads & Essential Services Learn more at www.florenceaz.gov/2026-sales-tax-initiative