Town of Sahuarita - 2018 Approved Budget by sahuaritaaz

2018 APPROVED BUDGET

TABLE OF CONTENTS Budget Award ......................................................................................................................................................................... 1 Managerâ&#x20AC;&#x2122;s Letter (published with approved budget) ............................................................................................................. 3 Elected Officials....................................................................................................................................................................... 6 Strategic Plan-Focus Areas ...................................................................................................................................................... 7 Organization Chart .................................................................................................................................................................. 8 Budget Summary..................................................................................................................................................................... 9 Major Revenue Sources ........................................................................................................................................................ 23 Fund Budgeting ..................................................................................................................................................................... 35 Department Summaries and Performance Measures .......................................................................................................... 53 Mayor and Council ............................................................................................................................................................ 56 Town Manager .................................................................................................................................................................. 60 Department of Law ........................................................................................................................................................... 66 Town Clerk ........................................................................................................................................................................ 70 Finance .............................................................................................................................................................................. 74 Human Resources ............................................................................................................................................................. 78 Planning and Building ........................................................................................................................................................ 82 Parks and Recreation ........................................................................................................................................................ 86 Public Works ..................................................................................................................................................................... 92 Police ................................................................................................................................................................................. 96 Municipal Court............................................................................................................................................................... 100 Streets ............................................................................................................................................................................. 104 Wastewater ..................................................................................................................................................................... 108 Non-Departmental .......................................................................................................................................................... 112 Department History of Operating Expenditures ............................................................................................................. 114 Staffing Levels ................................................................................................................................................................. 118 General Planning Five-Year Plan .................................................................................................................................................................. 121 Capital Improvement Plan .............................................................................................................................................. 138 Debt ................................................................................................................................................................................. 169 Supporting Information The Budgetary Process .................................................................................................................................................... 172 Budget/CIP Calendar ....................................................................................................................................................... 174 Financial and Budgetary Policies ..................................................................................................................................... 176 Legal Requirements......................................................................................................................................................... 184 Official Budget Forms ...................................................................................................................................................... 186 Supplemental Information Demographics .................................................................................................................................................................. 194 Glossary ........................................................................................................................................................................... 200 Acronyms ......................................................................................................................................................................... 205

The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation Award to the Town of Sahuarita, Arizona for its annual budget for the fiscal year beginning July 1, 2016. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as a financial plan, as an operations guide, and as a communications device. This award is valid for a period of one year only. We believe our current budget continues to conform to program requirements, and we are submitting it to GFOA to determine its eligibility for another award.

Another passing year gives pause for a discussion about where our community is headed and where we’ve been. There really is no better framework for this discussion than our annual budget, which represents what we plan to do with the dollars entrusted by residents through the taxes and fees they pay. It’s through this system of governance, checked by public accountability, that we are able to offer amenities such as our public parks and necessities such as law enforcement and infrastructure projects. We are able to keep our roads in repair and plan for expansion of amenities well into the future precisely because we have kept careful watch over every dollar we save and every dollar we spend. We are able to offer our police department the best in emerging technologies to keep the public safe because we spend your money wisely. Another year comes and goes and we are happy to report that we are still in a great place, fiscally speaking. As with every year, this year’s budget reflects the shifting priorities that come with new opportunities and challenges. There have been some major developments this year that have expanded the services offered by the Town, and these have the potential to have great impact as improvements over the existing services. In this regard, the town was pleased to announce in late May that we would launch our own Animal Services Division to replace the existing services. We have thus terminated our intergovernmental agreement with Pima County Animal Care Center as of July 1. It was both a concern for making sure that our residents have access to the best service, and our desire to spend public money wisely that inspired this change. This will allow us to respond better to resident calls, help keep the community safe, ensure animal welfare and provide the accountability our residents expect and deserve. We have hired one full-time employee to add to the Town’s roster of public servants as an animal control officer, and we’ve contracted with the reputed no-kill Humane Society of Southern Arizona for sheltering services. We have taken over dog licensing from the county and are currently licensing dogs and promoting animal care through shot clinics for dogs and other such related events to come. A great advancement is standing just over the horizon for our Sahuarita Police Department too. Several years in the making, we are happy to announce that we will be purchasing body-worn camera equipment for our officers this year, which will be paid for with anti-racketeering funds.

Body-worn cameras can provide real-time evidence for use in court cases, ensuring that justice follows facts. They also improve the quality of police reports by allowing an officer to record conducted interviews with witnesses and victims of crime. In addition, body-worn cameras ensure that police work is done in keeping with the constitution and rights of United States citizens. Cameras are a device for quality control of police work and serve to decrease complaints filed against officers, saving the Town and taxpaying residents from expensive claims and litigation. Our Public Works Department has kicked road maintenance into full-gear. As opposed to fiscal year 2017, where there were new construction and major road projects, 2018 will see dollars budgeted more toward maintaining and repairing roads, so that we keep our infrastructure in the well-maintained condition to which our residents are accustomed. Town Council has seen fit to make sure that the budget reflects this priority with $1.4 million allocated for our road maintenance program. Residents will see a number of maintenance and road upgrade projects over the summer and into the fall of 2017, as ADA ramps, curbs, and drainage scuppers are installed and sidewalks are replaced. In addition, with a forward view toward public safety and traffic flow, roadways are being widened and otherwise augmented to accommodate left-turn lanes at Camino Rancheria, Camino Rancho Caliente and Camino Rancho Tierra. In terms of economic development, we have a few really great things coming down the pipeline. Probably most exciting for those of us at Town Hall, is the Sahuarita Advanced Manufacturing Technology Center (SAMTEC) project that has been cleared for groundbreaking through the Town’s $3 million grant award from the Economic Development Administration (EDA). SAMTEC will house multiple businesses with the intent to establish a small business innovation, research and technology cluster. This project will help to attract new industries and employment opportunities for residents. It will no doubt also make Sahuarita a more attractive place for service industry businesses to locate and supply the kind of amenities that our residents want to see develop. In addition, to groundbreaking on SAMTEC, 2018 will also see 200,000 square feet of new retail space under construction, most notably in the development projects of “The Crossing at Sahuarita” and “The Corner at Rancho Sahuarita.” For all of these projects the current budget will realize additional building permit revenues and construction contracting taxes—as construction begins or continues. Future budgets will realize additional sales tax revenue as the businesses that occupy the spaces become operational. In 2018, you will see the Town Center/Public Plaza visioning effort continue. Most costs associated with this project will be borne out later, but much of the planning for it is slated for completion in 2018. The true shape and scope of this project remains to be seen, and direction from council as well as input from residents will ultimately help sculpt it into a reality. We are so excited to see how it will take form. We are confident that we have put into motion the cogs that will turn out a fully-realized public gathering place and associated private developments that our entire community will enjoy for many years to come. This Town Center Project is a tangible result born of last year’s Branding, Development and Marketing Action Plan where the Town also adopted a new logo, tagline and aesthetic motifs to support Sahuarita’s identity as a communityoriented place with abounding growth opportunities for families, businesses and economy.

As with 2017, fiscal year 2018 will see published marketing materials from the town undergo changes to match the Town’s new brand direction, as well as a website overhaul that will bring the website into line with the new brand, and make the site more accessible, easier to use, and informative for residents. These changes will come with concern for fiscal responsibility (as did the re-branding initiative itself: paid for by grant funding) as we work brand changes into the normal course of our routine work, and as these changes become feasible and logistically sound, in line with plans already in motion. For example, the website overhaul does not add any substantial costs to the Town for 2018. This is because the work done by our content manager is included in our subscription to their services which were purchased in a previous year, and we have waited for this opportune time (after re-branding) to go through the process of a website overhaul. Residents will note new taglines on event posters and Town marketing materials that proudly proclaim what we know to be true about Sahuarita, “you’re gonna love it here” because this is truly, “where life comes together!” In this fiscal year, we will see some expansion of existing recreation efforts and special events. Our Parks and Recreation Department will hire lifeguards to continue the Summer Open Swim program for the public at SUSD’s Aquatics Center. In addition, our inaugural Summer Concert Series—Live Music at the Lake—will be expanded to continue into the fall and winter seasons, bringing even more family fun and entertainment to our public Sahuarita Lake Park. As previous years bear out, we expect that our Halloween Spooktacular, Winter Festival, and Fiesta Sahuarita will continue to bring us together to celebrate the spirit of community and collaboration. In addition to the many wonderful things going on in Sahuarita, we also recognize the challenges that we will face in the coming year. Among the most challenging issues we face is the large sum of past-due balances owed by wastewater customers. We have put much effort into collecting these sums thus far, and we plan to expand our efforts in the coming year. We do expect that a financial rate analysis completed by an outside agency will recommend increasing wastewater service rates to handle deficits in the fund. These deficits have unfortunately been exacerbated by the number of customers not paying their wastewater bills. We will continue to work with all of our customers to assure that they receive top-notch service through a top-notch facility. As we make our way into 2018 and focus on the plans in motion—and as we celebrate our many successes—may we also reflect on the community spirit that is the source of our greatest strength. I am truly honored to serve the Town of Sahuarita as Town Manager, and I’m proud of our fiscal position and how strong it is. We can be confident that the future for Sahuarita is one where opportunity abounds. We find ourselves beautifully connected. I can honestly say to anyone coming to visit us, “you’re gonna love it here!” because this really is a place where life comes together and dreams are realized. Sincerely,

L. Kelly Udall Town Manager

BUDGET SUMMARY The 2018 budget uses available resources to achieve desired results. The budget totals $61,283,920 and is in balance, which means that total funding sources equal or exceed total budgeted expenditures. Budgeted expenditures total $45,347,480 and ending balances total $15,936,440. The budget is adopted for each of the Townâ&#x20AC;&#x2122;s seven funds as follows.

$17,500,000 $15,000,000 $12,500,000 $10,000,000 $7,500,000 $5,000,000 $2,500,000 $0 ($2,500,000) ($5,000,000) ($7,500,000)

General Expenditures 15,905,220 Ending Balances $16,533,260

HURF 2,804,080 $389,100

GARS 785,880 $246,100

QC CFD 703,690 $-

RS CFD 7,699,060 $-

CIIF 11,622,420 $4,329,800

Wastewater 5,827,130 $(5,561,820)

The ending balance deficit in the Wastewater Fund is covered by the surpluses in the General and CIIF funds. See the Fund Budgeting section for more discussion.

The budget is funded from a combination of revenues, debt proceeds, and beginning fund balances. Revenues come from recurring sources, such as taxes, and capital grants for one-time projects. In 2018 these sources provide $31.5 million, or 51.4%, of the total for the budget. Beginning fund balances, which represent available resources accumulated from prior years, provide $22.2 million, or 36.3%, of the total funding sources for the budget. The remaining $7,590,000, or 12.4% of the total budget, will be funded by debt proceeds. Revenues are classified by source. Tax revenues are derived from the 2% transaction privilege tax, property taxes for the Quail Creek Community Facilities District, the 4% construction contracting tax, and franchise fees. Licenses and permits are collected from building permit and sewer connection fees. Intergovernmental revenues are derived from state shared revenues and grants awarded from federal, state, and local governments. Charges for services are earned through sewer user fees, development review fees, recreation program charges, and cost allocation recovery. Other revenues are generated from fines, forfeitures, investment earnings, developer contributions, and other miscellaneous items not classified elsewhere. Refer to the Major Revenue Sources section of this document for more information on revenues.

Where the Money Comes From Funding Sources: $61,283,920

Beginning Balances $22,218,400 36%

Other $1,592,980 3%

Governmental $15,186,200 25%

Taxes $8,505,630 14%

Debt Proceeds $7,590,000 12% Licenses & Permits, $1,886,830 , 3% Charges for Services $4,303,880 7%

Expenditures and other uses are classified by type. Approximately $15.9 million, or 26.0%, of the budgeted sources are not expected to be spent during the year and, therefore, will be the fund balances at the end of the year. Any fund balance that is not restricted may be used at the discretion of Town Council for emergencies, unforeseen events or opportunities. Operations accounts for $22.7 million, or 37.0%, of the budget. Operations include current costs associated with the day-to-day activities of the Town. These costs include payroll, contracted services, supplies, operating capital and other as provided on the next page. Capital outlay comprises $17.0 million, or 27.8%, of the budget. This appropriation will be used to build and purchase capital assets that are not considered to be part of the operating budget. The Capital Improvement Plan provides detailed descriptions and budget plans for the Townâ&#x20AC;&#x2122;s capital projects and acquisitions for the next five years. The debt service category represents $5.6 million, or 9.2%, of the budget and accounts for the annual payments on long-term debt and capital lease principal, interest, and fees paid.

Where the Money Goes Funding Uses: $61,283,920

Operations, $22,712,240 , 37%

Ending Balances $15,936,440 26%

Debt Service, $5,620,140 , 9%

Capital Outlay, $17,015,100 , 28%

There are five categories of operational expenditures: (1) personnel, (2) services, (3) supplies, (4) other, and (5) operating capital. The personnel category accounts for the largest component of operations. Costs in this category are those associated with maintaining a workforce and include salaries and wages, health and dental insurance, payroll taxes, pension plan contributions, workerâ&#x20AC;&#x2122;s compensation, unemployment insurance, and uniform allowances. The services category, which accounts for outsourced services and other contractual obligations. This is the second largest category of operations. Services include utility costs and professional services such as those performed by attorneys, auditors, financial advisors, and engineers. These services also include intergovernmental agreements with State and Pima County for services provided for tax collections, animal control, 911 dispatch, and incarceration. The supplies category included items such as fuel, postage, police armory and range supplies, tires, recreation supplies, street signs and barricades, wastewater chemicals, and small equipment purchases. The other category accounts for items that are not accounted for in the other categories and includes travel and training, memberships, subscriptions, insurance premiums, sponsorships, contributions to organizations to provide services to others, and internal costs allocations. Operating capital represents vehicle and equipment purchases, facility repairs and maintenance improvements, and capital-related studies with unit costs of $5,000 or more. These projects are smaller in scope, size, and cost of other capital projects but are often necessary for departments to accomplish their operational objectives.

Where the Money Goes Operations (by Category): $22,712,240

Capital $1,182,100 5%

Personnel, $13,651,480 , 60%

Other $1,725,380 8%

Supplies $1,205,310 5%

Services, $4,947,970 , 22%

Operations and capital outlay expenditures are also classified by functional area. See the Capital Plan section for more details on capital outlay. Where the Money Goes Operations (by Function): $22,712,240

Where the Money Goes Capital Outlay (by Function): $17,015,100

General Government, $6,241,400, 27%

Highways & Streets, $8,433,810, 50%

Sewer, $2,175,110, 10%

Recreation, $2,591,000, 15% Sewer $1,220,930 7%

Recreation, $1,939,660, 9%

Highways & Streets, $2,975,190, 13%

Public Safety, $9,380,880, 41%

Public Safety, $0, 0%

General Government, $4,769,360, 28%

The general government function accounts for the Mayor & Council, Town Manager, Town Clerk, Law, Finance, Human Resources, and Municipal Court departments, as well as the Planning & Zoning and Facilities divisions of the Planning & Building and Public Works departments, respectively. A large portion of the Town’s workforce is accounted for in this function, which explains its significant operational costs. Capital outlay includes the SAMTEC economic development project as well as indirect cost allocations made to the capital projects fund. The public safety function includes the Police Department as well as the Planning & Building- Building Safety and Public Works – Engineering divisions. This function is the costliest with respect to the Town’s operations mainly because its workforce is the largest. No major capital projects are planned for the year. The highways and streets function accounts for operational costs of the Streets Department. This department focuses on the maintenance of the Town’s roadway system as well as other transportations issues, such as traffic signaling and street lighting. This function has a capital outlay budget for major roadway improvement and traffic safety projects as well as project management staff. The recreation function accounts for the Parks & Recreation Department. This department maintains all park and park facilities in the Town. The department also provides for recreational programming and various special events throughout the year. This capital budget includes partnering with the Sahuarita Unified School District to build more ballfields usable by the community and not just schools. The sewer function accounts for the activities of the wastewater utility, including customer billing and collections. The capital budget includes the building of two retention basins at the sewer plant and allocated payroll and indirect costs.

Debt was used in the past to finance the acquisition of assets and infrastructure. For 2018 the debt service obligation for each fund follows:

Where the Money Goes Debt Service: $5,620,140

CIIF Loans/Leases, $1,609,820 , 29% QC CFD Bonds, $656,280 , 12% WW Loans/Leases $2,431,090 43%

RS CFD Bonds $922,950 16%

Debt service in the RS CFD fund will include up to $560,000 for debt issuance. These costs will be paid by bond proceeds. Refer to the Debt section of this document for more information on debt repayment.

Employees play the most significant part in providing services to our citizens. The Town accounts for employees by function as shown on the chart below.

Staffing Levels by Function Full-Time Equivalent Employees (FTE): 139.7

Sewer, 6.3 , 4%

General Government, 41.0 , 29%

Recreation 16.3 12%

Public Safety, 65.5 , 47% Highways & Streets, 10.7 , 8%

The following are position and staffing level changes made since last yearâ&#x20AC;&#x2122;s budget was adopted. See the Employee Staffing section for more information.

Department Parks & Recreation Police Municipal Court Streets

Description Part-time Rec Leader & Lifeguards (swim program) Records Supervisor & Animal Control Officer Security Officer (outsourcing) Civil Engineer Total FTE Changes

FTE Change +1.0 +2.0 -1.0 +1.0 +3.0

Budgeted personnel costs are increasing $715,560. this amount, $248,800 relates to the net FTE additions, as identified on the previous page. $207,000 is associated with employee pay changes for merits. $91,000 relates to increases in medical insurance premiums. $217,300 is for increased retirement contribution rates to the Public Safety Personnel Retirement System. Cost reductions include $61,300 in grant-funded overtime and $13,800 in workersâ&#x20AC;&#x2122; compensation premiums. Other cost changes are not material and relate to personnel changes (e.g., turnover, etc.) and other miscellaneous personnel-related areas.

Millions

Evaluating the changes between the budgeted expenditures for fiscal years 2017 and 2018 provides a better understanding of how workforce, operational costs, community growth, and the economy as a whole can impact the budget from one year to the next. Major changes by expenditure category are explained below. Other cost changes are addressed in the Departmental section.

$16

$14 $12

$10 $8 $6 $4 $2

Costs for services are increasing $836,970. Of this $0 amount, $597,000 is allocated in the Streets Personnel Department for pavement management, grantFY 2018 $13,651,480 funded roadway engineering studies, CFD FY 2017 $12,935,920 engineering costs, traffic signal repairs, and the % Change 5.5% (roadway) youth art program; $74,000 is allocated in the Police Department for animal control and the body camera program; $67,500 for expanded wastewater collections efforts; and $63,500 for other engineering and development review. Other less significant changes, increases and decreases, are identified in Departmental section. The supplies budget is increasing by $97,820. $80,000 of the increase is for grant-funded police equipment. Other increases are mostly related to the purchase of new software packages and inflationary cost impacts. Conversely, the budget for fuel is dropping by $29,700 as it appears the amount budgeted in 2017 was too high. Other expenditures are going up by $136,910. Of this amount, $50,000 is associated with allowances for bad debt on wastewater customer accounts; $27,900 is to account for more indirect costs being allocated to other operational cost centers; $27,300 more for memberships, travel and training; $15,500 for the Wastewater Department recycle/greycycle events; and $12,900 for increasing insurance premiums for property and liability insurance. The operating capital budget is increasing by $151,720. Overall, there are a few more vehicle and equipment replacements/purchases scheduled for 2018. See the Capital Plan section for more information. Debt service is increasing by $522,980. The amount primarily represents the net difference between last yearâ&#x20AC;&#x2122;s Quail Creek CFD bond refunding, which lowers debt service costs in 2018, offset by new debt costs associated with the issuance of Rancho Sahuarita CFD bonds in 2018. Other changes are associated with existing debt payment scheduled amounts.

Millions

$6 $5 $4 $3

$2 $1 $0

Millions

FY 2018 FY 2017 % Change

Services

Supplies

Other

Operating Capital

Debt Service

$4,947,970 $4,111,000 20.4%

$1,205,310 $1,107,490 8.8%

$1,725,380 $1,588,470 8.6%

$1,182,100 $1,030,380 14.7%

$5,620,140 $5,097,160 10.3%

$18

Capital outlay is increasing by $7.69 million. $7.32 million of the increase is tied to the Rancho Sahuarita CFD purchase of infrastructure from a developer who is constructing public infrastructure in the District. This infrastructure acquisition will be funded by debt.

$16

$14 $12 $10

See the Capital Improvement Plan section for information related to Town projects and other capital outlay changes.

$6 $4

$2 $0 FY 2018 FY 2017 % Change

Capital Outlay $17,015,100 $9,323,540 82.5%

Changes in Fund Balance Aggregate of Appropriated Funds 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

$ 7,833,935 1,636,793 13,218,488 4,096,612 284,850 276,623 3,696,543 31,043,844

$ 7,760,010 1,496,260 14,522,480 4,175,890 390,900 252,300 1,007,910 29,605,750

$ 7,667,850 1,566,470 13,948,680 4,060,860 202,070 278,200 1,052,570 28,776,700

$ 8,505,630 1,886,830 15,186,200 4,303,880 278,620 263,220 1,051,140 31,475,520

Expenditures: Operations: General Government Public Safety Highways & Streets Recreation Sewer Operations Total

4,949,318 7,265,205 1,677,927 1,522,317 1,811,646 17,226,413

6,101,710 8,608,820 2,213,840 1,868,670 1,980,220 20,773,260

6,106,710 8,603,820 2,213,840 1,868,670 1,980,220 20,773,260

6,070,670 8,078,380 2,120,360 1,779,890 1,920,080 19,969,380

6,241,400 9,380,880 2,975,190 1,939,660 2,175,110 22,712,240

Debt Service Capital Outlay Expenditures Total

4,901,176 7,020,888 29,148,477

5,097,160 9,323,540 35,193,960

5,184,090 4,441,760 29,595,230

5,620,140 17,015,100 45,347,480

1,895,367

(5,588,210)

(818,530)

(13,871,960)

286,327 390,351 676,678 2,572,045 19,956,798

205,000 205,000 (5,383,210) 21,165,480

300,000 118,100 118,100 (700,430) 22,528,830

270,000 7,320,000 7,590,000 (6,281,960) 22,218,400

$ 22,528,843

$ 15,782,270

$ 21,828,400

$ 15,936,440

Revenues: Taxes Licenses & Permits Intergovernmental Charges for Services Fines & Forfeits Investment Earnings Miscellaneous Revenues Total

Revenues Over (Under) Expenditures Other Funding Sources/(Uses): Capital Leases Net Debt Proceeds Net Other Funding Sources/(Uses) Change in Fund Balance Beginning Fund Balance Ending Fund Balance

Notes: The 2017 estimated actuals are based on eight months of actual figures, July through February, and four months of estimated figures, March through June. Beginning fund balances represent available resources accumulated from prior years. Ending fund balances represent financial resources available for future years and contingencies. For the enterprise fund, fund balance is essentially equivalent to the noncapital portion of net assets.

Changes in Fund Balances Appropriated Funds Fiscal Year 2018 General Fund Revenues: Taxes Licenses & Permits Intergovernmental Charges for Services Fines & Forfeits Investment Earnings (Losses) Miscellaneous Revenues Total

$ 5,650,300 1,339,950 7,578,350 958,960 190,750 239,780 66,350 16,024,440

HURF Fund $

4,141,310 10,740 4,152,050

GARS Fund $

QC CFD Fund

RS CFD Fund

416,540 15,000 87,870 3,060 32,500 554,970

$ 508,470 195,220 703,690

CIIF Fund

40,860 338,200 379,060

$ 2,306,000 3,050,000 79,250 208,000 5,643,250

Wastewater Fund $

Total

- $ 8,505,630 546,880 1,886,830 15,186,200 3,329,920 4,303,880 278,620 (69,610) 263,220 210,870 1,051,140 4,018,060 31,475,520

Expenditures: Operations: General Government Public Safety Highways & Streets Recreation Sewer Operations Total

5,720,490 8,287,400 1,897,330 15,905,220

2,804,080 2,804,080

10,500 760,380 15,000 785,880

3,570 16,510 27,330 47,410

1,840 15,600 17,440

505,000 333,100 139,000 977,100

2,175,110 2,175,110

6,241,400 9,380,880 2,975,190 1,939,660 2,175,110 22,712,240

Debt Service Capital Outlay Expenditures Total

15,905,220

2,804,080

785,880

656,280 703,690

922,950 6,758,670 7,699,060

1,609,820 9,035,500 11,622,420

2,431,090 1,220,930 5,827,130

5,620,140 17,015,100 45,347,480

119,220

1,347,970

(230,910)

(7,320,000)

(5,979,170)

(1,809,070)

(13,871,960)

7,320,000 -

270,000 3,258,310

1,186,640

270,000 7,320,000 -

(622,430)

(6,281,960)

Revenues Over (Under) Expenditures Other Funding Sources (Uses) Capital Leases Net Debt Proceeds Net Transfers In (Out)

(2,695,000) (1,749,950)

Change in Fund Balance

(2,575,780)

(401,980)

(230,910)

(2,450,860)

Fund Balance, 7/1/2017

19,109,040

791,080

477,010

6,780,660

$ 16,533,260

$ 389,100

$ 246,100

$ 4,329,800

Fund Balance, 6/30/2018

Note: Each fund, and the change in its fund balance is discussed in the Fund Budgeting section of this document.

(4,939,390)

22,218,400

$ (5,561,820) $ 15,936,440

Funding Sources Fiscal Year 2018 General Fund

HURF Fund

GARS Fund

QC CFD Fund

RS CFD Fund

CIIF Fund

Wastewater Fund

% of Sources

Total

Revenues: Taxes

$ 5,650,300

Licenses & Permits

1,339,950

Intergovernmental

7,578,350

4,141,310

$508,470

40,860 $ 2,306,000

416,540

3,050,000

546,880 -

$ 8,505,630

13.9%

1,886,830

3.1%

15,186,200

24.8%

4,303,880

7.0%

Charges for Services

958,960

15,000

Fines & Forfeits

190,750

87,870

278,620

0.5%

Investment Earnings (Losses)

239,780

10,740

3,060

79,250

(69,610)

263,220

0.4%

66,350

32,500

195,220

338,200

208,000

210,870

1,051,140

1.7%

554,970

703,690

379,060

5,643,250

4,018,060

31,475,520

51.4%

270,000

0.4%

7,320,000

11.9%

Miscellaneous Revenues Total

16,024,440

4,152,050

3,329,920

Capital Leases

Net Debt Proceeds

3,258,310

1,186,640

6,780,660

(4,939,390)

Net Transfers In (Out)

(2,695,000) (1,749,950)

Beginning Fund Balances

19,109,040

Total Funding Sources % of All Funds

791,080

477,010

7,320,000

270,000 -

0.0%

22,218,400

36.3%

$ 32,438,480 $ 3,193,180 $ 1,031,980 $ 703,690 $ 7,699,060 $ 15,952,220 $ 265,310 $ 61,283,920

100.0%

52.9%

5.2%

1.7%

1.1%

12.6%

26.0%

0.4%

100.0%

Funding Uses Fiscal Year 2018 Fund/Department General Fund Mayor & Council Town Manager Law Town Clerk Finance Human Resources Planning & Building Parks & Recreation Public Works Police Municipal Court Non-Departmental Subtotal: HURF Fund GARS Fund QC CFD Fund RS CFD Fund CIIF Fund Wastewater Fund ALL FUNDS TOTAL

Fund/Department General Fund Mayor & Council Town Manager Law Town Clerk Finance Human Resources Planning & Building Parks & Recreation Public Works Police Municipal Court Non-Departmental Subtotal: HURF Fund GARS Fund QC CFD Fund RS CFD Fund CIIF Fund Wastewater Fund ALL FUNDS TOTAL % of All Categories

Personnel $

OPERATIONS Supplies Other

Services

59,200 $ 10,200 $ 713,440 29,660 622,120 43,250 370,540 161,810 759,840 295,550 232,240 13,370 1,196,120 83,060 1,028,750 563,030 416,700 540,400 6,002,900 653,930 474,240 81,650 58,250 11,876,090 2,534,160

5,300 $ 15,030 16,700 17,350 16,880 17,950 15,380 195,590 37,900 256,700 21,340 2,500 618,620

Capital

62,850 $ 28,150 16,350 29,180 350,910 16,380 17,480 109,960 13,570 113,000 24,850 93,670 876,350

Total -

137,550 786,280 698,420 578,880 1,423,180 279,940 1,312,040 1,897,330 1,008,570 7,026,530 602,080 154,420 15,905,220

821,690 1,482,290 204,430 295,670 2,804,080 275,540 124,950 214,000 16,390 155,000 785,880 16,010 500 30,900 47,410 15,600 1,840 17,440 977,100 977,100 678,160 774,960 167,760 504,230 50,000 2,175,110 $ 13,651,480 $ 4,947,970 $ 1,205,310 $ 1,725,380 $ 1,182,100 $ 22,712,240 OPERATIONS From above Total $

137,550 $ 786,280 698,420 578,880 1,423,180 279,940 1,312,040 1,897,330 1,008,570 7,026,530 602,080 154,420 15,905,220

Debt Service

Capital Outlay -

2,804,080 785,880 47,410 656,280 17,440 922,950 977,100 1,609,820 2,175,110 2,431,090 $ 22,712,240 $ 5,620,140 $ 37.1%

9.2%

Fund Balances

Categories Total

% of All Funds

- $ 137,550 786,280 698,420 578,880 1,423,180 279,940 1,312,040 1,897,330 1,008,570 7,026,530 602,080 16,533,260 16,687,680 16,533,260 32,438,480

52.9%

389,100 3,193,180 246,100 1,031,980 703,690 6,758,670 7,699,060 9,035,500 4,329,800 15,952,220 1,220,930 (5,561,820) 265,310 17,015,100 $ 15,936,440 $ 61,283,920

5.2% 1.7% 1.1% 12.6% 26.0% 0.4% 100.0%

27.8%

26.0%

100.0%

Interfund Transfers Fiscal Year 2018

Transfers From

Transfer Recipient

General Fund

General HURF GARS QC CFD RS CFD Fund Fund Fund Fund Fund $$ $ -

HURF Fund

$ -

GARS Fund

QC CFD Fund

RS CFD Fund

CIIF Fund

Wastewater Fund Total

CIIF Wastewater Fund Fund Total A A $ 1,505,000 $ 1,190,000 $ 2,695,000 1,749,950 B

1,749,950

3,360

$ -

$ 3,258,310

3,360 $ 1,190,000

$ 4,448,310

Descriptions: A

These cash transfers will be used to fund all or portions of specific capital projects in the CIIF or Wastewater Funds.

These transfers are needed to move capital grant sources recorded in HURF Fund to the CIIF Fund, which incurs the projects costs that are subject to reimbursement.

MAJOR REVENUE SOURCES

Major Revenue Sources FY 2018

Millions

The following table displays 89% ($27.0 million) of the total revenues expected to be reported in fiscal year 2018 and in which fund they are accounted.

$16.0

$14.0

$12.0

$10.0

$8.0

$6.0

$4.0

$2.0

$0.0 Sales Tax Construction Tax Franchise Tax Building Permit Fees Sewer Connection Fees State Sales Tax State Income Tax State Vehicle License Tax State Shared HURF Capital Grants Sewer User Fees

General $5,338,030

HURF

CIIF

Wastewater

$2,306,000 $312,270 $1,304,150 $546,880 $2,696,620 $3,560,890 $1,320,840

$2,270,470 $1,720,840

$3,200,000 $3,329,920

General Sales Taxes (Taxes)

Millions

Description & Use

A transaction privilege tax is assessed on sales activity within the Town limits. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations.

$8.0

$250

$7.0 $200 $5.0

$150

$4.0 $100

$3.0 $2.0

$50 $1.0 $0.0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$4,202,991 $157

$4,432,280 $161

$4,740,679 $169

$4,969,422 $175

2017 estimate $5,067,810 $175

2018 projected $5,338,030 $180

2019 projected $5,856,340 $192

2020 projected $6,284,010 $202

2021 projected $6,522,120 $206

2022 projected $6,762,520 $209

Current Rate Structure

The Town operates under Arizonaâ&#x20AC;&#x2122;s Model City Tax Code (http://modelcitytaxcode.az.gov/). The Town assesses a 2.0% tax rate on most general, non-service business transactions. The State of Arizona collects taxes on behalf of the Town and remits them to the Town on a weekly basis.

Assumptions

Projections were based on estimated population and growth in commercial development. The estimates were derived using planning documents for new development in the Town. Inflationary factors and tax leakage assumptions were also considered in the projections.

Trend

Positive. General sales taxes per capita are projected to increase over time. More commercial development will result in less sales leakage, resulting in a higher per capita capture rate.

Per Capita

$6.0

Construction Contracting Taxes (Taxes) A transaction privilege tax is assessed on construction contracting activity occurring within the Town limits. The Town Council has designated these revenues to pay for capital projects (and associated debt). These tax revenues are recorded in the CIIF, the Townâ&#x20AC;&#x2122;s Capital Projects Fund.

$3.5

200% 180%

$3.0

160%

$2.5

140%

120%

$2.0

100% $1.5

80% 60%

$1.0

40% $0.5

20%

$0.0 2013 actual

2014 actual

2015 actual

2016 actual

Revenue $3,127,220 % of Debt Service 174%

$2,484,010 138%

$1,860,564 113%

$2,131,797 136%

2017 estimate $1,838,740 110%

2018 projected $2,306,000 143%

2019 projected $2,524,280 125%

2020 projected $2,747,280 133%

2021 projected $2,900,950 125%

2022 projected $3,064,430 124%

Current Rate Structure

The Town operates under Arizonaâ&#x20AC;&#x2122;s Model City Tax Code (http://modelcitytaxcode.az.gov/). The Town has a tax rate of 4.0% on all construction contracting transactions. The State of Arizona collects taxes on behalf of the Town and remits them to the Town on a weekly basis.

Assumptions

Projections were based on growth estimates. The expectation was derived using planning documents for new development, factored for items influencing the housing market in the State and nationwide. Inflationary impacts were also considered.

Trend

Stable. Construction contracting taxes are projected to cover about the same percentage of debt service costs in the CIIF as it has in the past. Taxes are expected to increase in the future as more commercial is expected to develop. The capital plan, however, assumes that more debt will be issued in the future as well.

% of Debt Service

Millions

Description & Use

Franchise Taxes (Taxes) The Town of Sahuarita collects franchise fees from cable and gas utility providers pursuant to executed agreements. The agreements license the utilities to use the Townâ&#x20AC;&#x2122;s right-of-ways. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations.

$400

$14

$350

$12

$300

$10

$250 $8

$200 $6 $150

$100

$50 $0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$310,304 $12

$303,600 $11

$316,332 $11

$318,035 $11

2017 estimate $304,260 $10

2018 projected $312,270 $11

2019 projected $320,470 $11

2020 projected $327,190 $11

2021 projected $334,040 $11

2022 projected $341,030 $11

Current Rate Structure

Franchise tax rates are 5.0% and 2.0% for cable and gas, respectively. The rates are set forth in franchise agreements. The utility companies pay the taxes to the Town on a quarterly basis.

Assumptions

Projections were based on estimated growth in population. The estimate was derived using planning documents for new development.

Trend

Stable. Franchise taxes per capita are projected to be about the same as they have been in the past.

Per Capita

Thousands

Description & Use

Building Permit Fees (Licenses and Permits) Fees are charged for the permission to construct or alter buildings, structures, and improvements within the Town limits. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations, namely those of the Planning & Building Department.

$1,400

120%

$1,200

100%

$1,000

80%

$800

60% $600 40%

$400

20%

$200 $0 2013 actual Revenue $1,059,508 % of Dept Exps 108%

2014 actual

2015 actual

2016 actual

$721,627 64%

$1,045,486 94%

$1,326,659 114%

2017 estimate $1,287,880 97%

2018 projected $1,304,150 96%

2019 projected $1,179,020 84%

2020 projected $1,192,580 83%

2021 projected $1,203,420 81%

2022 projected $1,211,550 79%

Current Rate Structure

Building permitting fees are calculated primarily by the type and size of the building structure. Mechanical, plumbing, and electrical fees are calculated based upon a standard percentage of the building permit valuation. The fees are collected when the permits are issued to the applicant.

Assumptions

Projections were based on the number of permits expected to be issued for each year. The expectation was derived using planning documents for new development as well as expectations about factors influencing the housing market in the State and nationwide.

Trend

Slightly Negative. Compared to the past, future revenues are expected to cover a lower percentage of the direct costs to operate the Planning and Building Department. Costs increase over time due to inflationary factors. The increase in new growth is not expected to occur at quite the same rate, creating the slightly negative trend. Accordingly, future fee/rate increases may be warranted.

% of Dept Exps

Thousands

Description & Use

Sewer Connection Fees (Licenses and Permits)

Thousands

Description & Use

A fee is charged when facilities connect to the Town’s sewer system. Sewer connection fees are used to pay capital costs (and associated debt) to expand, improve, and maintain the wastewater treatment facilities. The fees are recorded in the Wastewater Enterprise Fund.

$900

40%

$800

35%

$700

30%

$600

25%

$500 20% $400 15%

$300

10%

$200

$100 $0 Revenue % of WW Debt Svc

2013 actual

2014 actual

2015 actual

2016 actual

$833,725 35.0%

$409,467 17.2%

$169,543 7.1%

$194,696 8.3%

2017 estimate $146,770 6.0%

2018 projected $546,880 22.5%

2019 projected $403,500 16.6%

2020 projected $479,130 19.7%

2021 projected $332,960 13.7%

2022 projected $635,170 26.1%

Current Rate Structure

The Town’s utility currently only serves two developments in the Town. For these developments, the Town is contractually obligated to charge the same fee that the Pima County Wastewater Utility charges. Charges are based upon water meter size that servers the facility in question. The fees are collected when building permits are issued. Pima County appears likely to increase fees in 2018, which means the Town will have to do the same.

Assumptions

Projections were based on the number of permits expected to be issued. The expectation was derived using planning documents for new development as well as expectations about factors influencing the housing market in the State and nationwide.

Trend

Positive. A larger proportion of the Town’s future growth is expected to occur in the utility’s service area. This will generate more revenues. As the debt service obligation is expected to remain flat, a higher percentage of these costs will be covered by the connection fees.

State Shared Sales Taxes (Intergovernmental) Incorporated cities and towns receive a portion of the State’s sales tax collections. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations.

$3.5

$120

$3.0

$100

$2.5

$80

$2.0

$60 $1.5 $40

$1.0

$20

$0.5 $0.0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$2,067,495 $77

$2,198,614 $80

$2,308,388 $82

$2,385,534 $84

2017 estimate $2,630,970 $91

2018 projected $2,696,620 $91

2019 projected $2,821,480 $93

2020 projected $2,976,670 $96

2021 projected $3,119,890 $98

2022 projected $3,255,080 $101

Current Rate Structure

The State’s transaction privilege tax rate is 5.6%. The State’s distribution is based upon the Town’s population figures in proportion to the populations of other municipalities. Historically, the population figures were adjusted every five years. Beginning in 2017 and afterwards, the population basis will be adjusted annually based upon US Census estimates. Distributions are made monthly.

Assumptions

The Arizona Department of Revenue provides the Town with projected revenues for the upcoming fiscal year. Future projections are based upon the Town’s estimated growth compared to the State’s projections for its future growth.

Trend

Positive. State shared sales taxes per capita are projected to increase over time. The State’s economy is growing and the Town’ population growth is expected to outpace the Statewide average.

Per Capita

Millions

Description & Use

State Shared Income Taxes (Intergovernmental) Incorporated cities and towns receive a portion of the State’s income tax collected in the fiscal year two years prior. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations.

$4.5

$140

$4.0

$120

$3.5

$100

$3.0 $2.5

$80

$2.0

$60

$1.5

$40

$1.0 $20

$0.5 $0.0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$2,580,152 $96

$2,815,436 $102

$3,057,758 $109

$3,041,180 $107

2017 estimate $3,470,980 $120

2018 projected $3,560,890 $120

2019 projected $3,664,790 $120

2020 projected $3,835,990 $123

2021 projected $3,996,670 $126

2022 projected $4,186,980 $129

Current Rate Structure

The State distributes to the municipalities 15% of the total income taxes it collected from two years prior. The State’s distribution is based upon the Town’s population figures in proportion to the populations of other municipalities. Historically, the population figures were adjusted every five years. Beginning in 2017 and afterwards, the population basis will be adjusted annually based upon US Census estimates. Distributions are made monthly.

Assumptions

Trend

Positive. State shared income taxes per capita are projected to increase over time. The State’s economy is growing and the Town’ population growth is outpacing the Statewide average.

Per Capita

Millions

Description & Use

State Shared Vehicle License Taxes (Intergovernmental) Incorporated cities and towns receive a portion of the State’s vehicle license tax collections. There are no restrictions placed on this revenue source. The revenues are recorded in the General Fund and are used to fund daily operations.

$1,800

$60

$1,600 $50 $1,400

$1,200

$40

$1,000 $30 $800 $600

$20

$400 $10 $200 $0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$925,392 $35

$962,878 $35

$1,006,277 $36

$1,058,242 $37

2017 estimate $1,214,350 $42

2018 projected $1,320,840 $44

2019 projected $1,410,820 $46

2020 projected $1,511,620 $49

2021 projected $1,612,940 $51

2022 projected $1,710,020 $53

Current Rate Structure

The State’s distribution is based upon the Town’s population figures in proportion to the populations of other municipalities. Historically, the population figures were adjusted every five years. Beginning in 2017 and afterwards, the population basis will be adjusted annually based upon US Census estimates. Distributions are made twice a month.

Assumptions

The Arizona Department of Transportation provides projections for statewide revenue collections. The Town’s projections start with the statewide figure and allocate a proportion of it based upon the Town’s projected population relative to that of the Statewide projected population for the year in question.

Trend

Positive. State shared vehicle license taxes per capita are projected to increase over time. The State’s economy is growing and the Town’ population growth is outpacing the Statewide average.

Per Capita

Thousands

Description & Use

Highway User Revenue Funds (HURF) (Intergovernmental) Incorporated cities and towns receive a portion of the State’s HURF collections. The Arizona Constitution restricts the use of HURF. Funding must be used exclusively for street and highway purposes, excluding use for traffic law enforcement or administration of traffic safety programs. These revenues are recorded in the HURF Special Revenue Fund.

$3.0

$90 $80

$2.5 $70

$2.0

$60 $50

$1.5 $40 $1.0

$30 $20

$0.5 $10 $0.0 Revenue Per Capita

2013 actual

2014 actual

2015 actual

2016 actual

$1,630,909 $61

$1,652,277 $60

$1,794,793 $64

$1,868,903 $66

2017 estimate $2,173,170 $75

2018 projected $2,270,470 $76

2019 projected $2,247,350 $74

2020 projected $2,346,240 $75

2021 projected $2,443,080 $77

2022 projected $2,530,780 $78

Current Rate Structure

The majority of the HURF is generated from the tax on fuel sales ($0.18 per gallon) and a portion on vehicle license taxes. Cities and towns receive 27.5% of total HURF collected. The funds are distributed based on two calculations. First, 50% of the available funds are distributed based on population figures in proportion to other local jurisdictions. Second, the remaining 50% is distributed to counties based on fuel sales and further to cities and towns based on population proportion in the county. Distributions are received monthly.

Assumptions

Trend

Slightly positive. State shared HURF per capita are projected to increase a little over time. The State’s economy is growing and the Town’ population growth is outpacing the Statewide average. Alternative fuel and more fuel efficient vehicles are expected to slow the revenue growth.

Per Capita

Millions

Description & Use

Capital Grants (Miscellaneous & Intergovernmental) The Town receives grant funding from other governmental entities such as the State of Arizona, Pima County, and the Regional Transportation Authority. The Town may also receive capital grants from non-governmental entities (miscellaneous revenue). Capital grant revenues are used for the acquisition and construction of capital assets, as restricted in the grant or intergovernmental agreements. These revenues are typically recorded in the HURF special revenue fund or the CIIF capital projects fund depending on the funding source and nature of the grant agreement.

$16

90%

$14

80%

$12

70%

60%

$10

50% $8

40% $6

30%

20%

10%

$0 2013 actual

2014 actual

2015 actual

2016 actual

Misc Revenue $Gov't Revenue $13,379,449 % of Capital 82%

$$9,087,167 75%

$72,438 $10,738,963 82%

$2,900,000 $2,343,948 85%

2017 estimate $165,000 $2,647,096 55%

2018 projected $150,000 $4,770,840 50%

2019 projected $$23,960 2%

2020 projected $$0%

2021 projected $$0%

2022 projected $$0%

Current Rate Structure

Capital grant agreements are typically structured to reimburse the Town for actual costs incurred. Grant agreements are in place with the Pima Association of Governments and the Regional Transportation Authority.

Assumptions

Agreements are in place for much of the projected revenues. These agreements primarily reimburse the Town for costs incurred. Therefore, revenues will be realized to the extent that expenditures are incurred on capital projects.

Trend

Negative. The proportion of capital projects funded by grants varies year-toyear but historically has exceeded 55%. The Town has yet to identify grants beyond 2018 for desired projects.

% of Capital

Millions

Description & Use

Sewer User Fees (Charges for Services)

Millions

Description & Use

Sewer user fees are charged to the households and businesses served by the wastewater utility. Sewer user fees are used to pay the operating costs of the wastewater utility and to pay a portion of the debt service costs. The fees are recorded in the Wastewater Enterprise Fund.

$4.5

$700

$4.0

$600

$3.5

$2.5

$400

$2.0

$300

$1.5 $200

$1.0 $100

$0.5 $0.0 Revenue Per Customer

2013 actual

2014 actual

2015 actual

2016 actual

$2,690,666 $506

$2,940,100 $544

$3,085,168 $563

$3,198,886 $576

2017 estimate $3,203,990 $570

2018 projected $3,329,920 $581

2019 projected $3,555,110 $608

2020 projected $3,783,440 $634

2021 projected $3,947,680 $649

2022 projected $4,021,530 $648

Current Rate Structure

Customers are billed monthly fees based on the average amount of water they consume during the prior yearâ&#x20AC;&#x2122;s winter months. Fees are set at a rate needed to pay for operations and a portion of debt service. The fees are reviewed periodically to determine if they are adequate to meet the obligations of the enterprise. Fees are expected to be increased in midway through 2018 and then for the two years following.

Assumptions

The majority of the projected revenues will be collected from existing customers. New customers of the utility will generate additional revenues. The expectation for new customers was derived using planning documents for new development and expectations about factors influencing the housing market in the State and nationwide

Trend

Positive. Future rate increases are expected to produce higher sewer user fees per customer over time. Also, we expect there to be more commercial development in the next five year, which will drive the average up.

Per Customer

$500 $3.0

FUND BUDGETING What is Fund Budgeting? The Town organizes its activities into seven different funds. Each fund in the Town of Sahuarita is a separate set of accounts that identifies and predicts unique sources and uses of funding. When summed together, these funds form the legal budget (see Legal Requirements section for more information). Each fund is accounted for separately. What is Fund Accounting and why is it different from business accounting? Governments and businesses perform their accounting in very different ways in order to accomplish different purposes. The Governmental Finance Officers Association describes the differences in the following way: For purposes of determining profitability, it typically suffices to look at a business “taken as a whole.” Such a “big picture” approach, however, normally is insufficient for assessing stewardship and compliance. What is really needed in this latter case is some tool for organizing and presenting data about financial resources that highlights the fact that certain resources have been “segregated for the purposes of carrying on specific activities or attaining certain objectives in accordance with special regulations, restriction, or limitations.” For state and local governments, that tool is fund accounting. What are the Funds used by the Town? The Town uses the following seven funds to account for all of its financial activity.  General Fund  Highway User Revenue Fund (HURF)  Grants and Restricted Sources Fund (GARS)  Quail Creek Community Facilities District Fund (QC CFD)  Rancho Sahuarita Community Facilities District Fund (RS CFD)  Capital Infrastructure Improvement Fund (CIIF)  Wastewater Fund (WW) What is a balanced budget? A fund is considered to be in balance when its financial sources equal its uses. Sources are made up of all money received during the year plus all savings from prior years, and uses are made up of all money spent during the year plus all money to be saved for future years. For practical purposes, however, it may be better to consider a fund in balance when there is at least as much money coming in as going out. When each fund is in balance, the sum of these funds (the budget taken as a whole) will be in balance.

APPROPRIATED FUNDS AND FUND TYPES GOVERNMENTAL FUNDS GENERAL

SPECIAL REVENUES

CAPITAL PROJECTS

Accounts for and reports all financial resources not accounted for and reported in another fund.

Accounts for and reports the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt.

Accounts for and reports financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other assets.

General Fund*

HURF Fund

CIIF Fund*

GARS Fund QC CFD Fund RS CFD Fund

PROPRIETARY FUND ENTERPRISE Reports activity for which a fee is charged to external users for goods and services.

Wastewater Enterprise Fund*

* Any budgeted fund that represents 10% or more of the total appropriated revenues or expenditures is considered a major fund.

FUNDS AND DEPARTMENTS Department Mayor & Council Town Manager Law Town Clerk Finance Human Resources Planning & Building Parks & Recreation Public Works Police Municipal Court Streets Wastewater NonDepartmental

GENERAL FUND

HURF FUND

GARS FUND

QC CFD FUND

RS CFD FUND

CIIF FUND

WW FUND

GENERAL FUND Purpose: The General Fund serves as the chief operating fund of the Town. It is used to account for all financial resources except those required to be accounted for in other funds.

2018 budgeted revenues exceed expenditures by $119,220 and are 8.0% and 7.2%, respectively, more than last year. The General Fund ending balance is expected to decline by $2.58 million. The decrease is attributable to transfers of resources to the CIIF and the Wastewater funds to provide funding for capital projects in those funds.

General Fund Services:  Law & order  Development assistance  Parks maintenance & recreation  Administration & support services

Millions

$25.0

$20.0

$15.0

$10.0

$5.0

$0.0 Ending Fund Balance

2016 Actual 18,690,868

2017 Estimate 19,109,040

2018 Budget 16,533,260

The ending fund balance is projected to be $16.5 million. Of this amount, $5.12 million is non-spendable as that amount of funding will be advanced to the Wastewater Fund to manage its deficit position. The remainder is 72% of the General Fund's budgeted expenditures, well above the 25% stabilization reserve level required by Town ordinance. The General Fund reserves commitment includes balances ($843 thousand) to cover the operational reserve deficiencies of the HURF and Wastewater Funds. The Town Council has also assigned $100,000, available for the Town Manager to handle unanticipated needs during the year, and continues to set aside $500,000 for future asset maintenance. Finally, the Town Council has adopted a policy establishing a $10 million target for unassigned reserves by 2020. Unassigned balances at 2018 year-end are projected to be $5.99 million.

GENERAL FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Taxes Licenses & Permits Intergovernmental Charges for Services Fines and Forfeitures Investment Earnings Miscellaneous Subtotal: Other Sources: Transfers Out Subtotal: Beginning Fund Balance: Nonspendable Committed Unassigned Subtotal: TOTAL SOURCES

$ 5,291,375 $ 5,390,400 $ 5,390,400 $ 5,372,070 $ 5,650,300 1,442,097 1,330,580 1,330,580 1,418,500 1,339,950 6,484,956 6,666,990 6,666,990 7,316,300 7,578,350 887,526 925,850 925,850 841,870 958,960 232,206 230,030 230,030 186,000 190,750 203,595 233,930 233,930 202,640 239,780 42,466 60,000 60,000 65,530 66,350 14,584,221 14,837,780 14,837,780 15,402,910 16,024,440

4.8% 0.7% 13.7% 3.6% -17.1% 2.5% 10.6% 8.0%

5.2% -5.5% 3.6% 13.9% 2.6% 18.3% 1.3% 4.0%

(2,695,000) (2,695,000)

-2.5% -2.5%

341.8% 341.8%

3,382,917 3,314,710 3,314,710 3,395,260 4,502,470 4,336,250 4,752,160 4,752,160 4,752,160 4,507,590 9,757,648 10,098,090 10,098,090 10,543,450 10,098,980 17,476,815 18,164,960 18,164,960 18,690,870 19,109,040 $31,769,211 $30,238,490 $30,238,490 $ 33,483,780 $32,438,480

35.8% -5.1% 0.0% 5.2% 7.3%

32.6% -5.1% -4.2% 2.2% -3.1%

$ 114,661 $ 113,860 $ 113,860 $ 125,420 $ 137,550 717,938 753,180 753,180 750,700 786,280 570,336 643,730 643,730 639,180 698,420 433,322 579,470 579,470 508,510 578,880 1,172,566 1,395,530 1,395,530 1,362,790 1,423,180 242,998 268,680 268,680 248,470 279,940 1,166,006 1,239,460 1,239,460 1,239,530 1,312,040 1,480,089 1,732,900 1,732,900 1,661,170 1,897,330 737,367 965,270 965,270 938,520 1,008,570 5,692,369 6,299,670 6,299,670 6,110,720 7,026,530 530,751 592,360 592,360 556,030 602,080 219,940 251,350 251,350 233,700 154,420 13,078,343 14,835,460 14,835,460 14,374,740 15,905,220

20.8% 4.4% 8.5% -0.1% 2.0% 4.2% 5.9% 9.5% 4.5% 11.5% 1.6% -38.6% 7.2%

9.7% 4.7% 9.3% 13.8% 4.4% 12.7% 5.8% 14.2% 7.5% 15.0% 8.3% -33.9% 10.6%

5,124,900 4,819,510

40.8% 1.4%

13.8% 1.4%

100,000 100,000 100,000 100,000 100,000 500,000 500,000 500,000 500,000 500,000 10,359,358 6,410,980 6,410,980 9,254,410 5,988,850 18,690,868 15,403,030 15,403,030 19,109,040 16,533,260 $31,769,211 $30,238,490 $30,238,490 $ 33,483,780 $32,438,480

0.0% 0.0% -6.6% 7.3% 7.3%

0.0% 0.0% -35.3% -13.5% -3.1%

(291,825) (291,825)

(2,764,250) (2,764,250)

(610,000) (610,000)

USES Current Expenditures: Mayor & Council Town Manager Law Town Clerk Finance Human Resources Planning & Building Parks & Recreation Public Works Police Municipal Court Non-Departmental Subtotal: Ending Fund Balance: Nonspendable Committed for Reserves Assigned for: Contingencies Asset Maintenance Unassigned Subtotal: TOTAL USES

3,395,260 4,336,250

3,639,890 4,752,160

4,502,470 4,752,160

HIGHWAY USER REVENUE FUND Purpose: The Highway User Revenue Fund (HURF) is a Special Revenue Fund that accounts for the Town’s share of the State’s motor fuel tax revenues. HURF revenues are restricted for transportation purposes.

In 2018, total revenues are expected to decrease by 32.9% below last year’s budget. This decrease is attributable to capital grants, whose funding is ultimately transferred to the CIIF to cover costs of street projects. Operating revenues will actually increase by 29.6%. Population adjustments (i.e., increases) account for the increase in operating revenues. Operating costs are budgeted to increase by 29.0% (see Streets Department section for more information on increases).

HURF Fund Services:  Maintain streets and bridges  Street lighting  Provide traffic control

Thousands

$900 $800 $700 $600 $500 $400 $300 $200 $100 $0 Ending Fund Balance

2016 Actual 671,434

2017 Estimate 791,080

2018 Budget 389,100

Ending fund balances will decrease by nearly $100 thousand. As the Town’s infrastructure ages, to maintain adequate roadway conditions, the fund will need to consume more resources than are generated each year. Ending fund balance is projected to be $389 thousand, which is restricted for transportation purposes only. This balance falls short of the 25% operational reserve requirement of the fund by $312 thousand. As such, the General Fund has set aside additional reserves to cover this shortfall.

HIGHWAY USER REVENUE FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Intergovernmental Investment Earnings Miscellaneous Subtotal: Other Sources: Transfers Out Subtotal: Beginning Fund Balance: Restricted for HURF Restricted for LTAF Subtotal:

TOTAL SOURCES

$ 1,893,699 $ 6,188,970 $ 6,188,970 $ 5,994,240 $ 4,141,310 7,245 2,090 2,090 5,050 10,740 3,368 4,200 1,904,312 6,191,060 6,191,060 6,003,490 4,152,050

-33.1% 413.9% -32.9%

-30.9% 112.7% -100.0% -30.8%

(3,806,580) (1,749,950) (3,806,580) (1,749,950)

-59.4% -59.4%

-54.0% -54.0%

426,016 302,670 302,670 671,020 791,080 11,167 410 437,183 302,670 302,670 671,430 791,080 $ 2,331,313 $ 2,178,730 $ 2,178,730 $ 2,868,340 $ 3,193,180

161.4% 161.4% 46.6%

17.9% -100.0% 17.8% 11.3%

$ 1,649,122 $ 2,174,450 $ 2,174,450 $ 2,076,850 $ 2,804,080 10,757 410 1,659,879 2,174,450 2,174,450 2,077,260 2,804,080

29.0% 29.0%

35.0% -100.0% 35.0%

671,024 4,280 4,280 791,080 389,100 410 671,434 4,280 4,280 791,080 389,100 $ 2,331,313 $ 2,178,730 $ 2,178,730 $ 2,868,340 $ 3,193,180

-100.0% 8991.1% 46.6%

-50.8% -50.8% 11.3%

(10,182) (4,315,000) (4,315,000) (10,182) (4,315,000) (4,315,000)

USES Current Expenditures: Streets LTAF Subtotal: Ending Fund Balances: Restricted for HURF Restricted for LTAF Subtotal:

TOTAL USES

GRANTS AND RESTRICTED SOURCES FUND Purpose: The Grants and Restricted Sources (GARS) Fund is a Special Revenue Fund that accounts for federal, state, and local operating grants and other operating revenues whose use is restricted for certain purposes.

The GARS fund balance is budgeted to decrease $231 thousand as a result of several purchases for police equipment and supplies, which will use resources previously accumulated for such purposes.

GARS Fund Services:  Enhance the Town’s policing

Thousands

$800 $700 $600 $500

 Sponsorships for Fiesta Sahuarita  Support activities of the Court

$400 $300 $200

 Account for grant activity

$100 $0

Ending Fund Balance

2016 Actual 543,882

2017 Estimate 477,010

2018 Budget 246,100

The ending fund balance is projected to be $246 thousand, which is restricted for use by the Police Department and Municipal Court. These balances will be consumed over time as the Town identifies appropriate uses for them.

GRANTS AND RESTRICTED SOURCES FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Intergovernmental Charges for Services Fines & Forfeitures Investment Earnings Miscellaneous Subtotal: Beginning Fund Balance: Restricted for Police Restricted for Courts Subtotal:

TOTAL SOURCES

$ 427,200 $ 480,930 $ 480,930 $ 365,460 $ 416,540 10,200 15,000 15,000 15,000 15,000 52,644 160,870 160,870 16,070 87,870 5,022 4,490 4,490 3,690 3,060 92,248 44,000 44,000 36,740 32,500 587,314 705,290 705,290 436,960 554,970

-13.4% 0.0% -45.4% -31.8% -26.1% -21.3%

14.0% 0.0% 446.8% -17.1% -11.5% 27.0%

557,156 532,920 532,920 504,080 430,340 35,353 39,480 39,480 39,800 46,670 592,509 572,400 572,400 543,880 477,010 $ 1,179,823 $ 1,277,690 $ 1,277,690 $ 980,840 $ 1,031,980

-19.2% 18.2% -16.7% -19.2%

-14.6% 17.3% -12.3% 5.2%

$ 538,600 $ 802,730 $ 802,730 $ 475,590 $ 760,380 76,813 21,000 21,000 18,240 10,500 12,500 15,000 15,000 10,000 15,000 8,028 635,941 838,730 838,730 503,830 785,880

-5.3% 100.0% 0.0% -6.3%

59.9% -42.4% 50.0% 56.0%

504,082 392,610 392,610 430,340 192,560 39,800 46,350 46,350 46,670 53,540 543,882 438,960 438,960 477,010 246,100 $ 1,179,823 $ 1,277,690 $ 1,277,690 $ 980,840 $ 1,031,980

-51.0% 15.5% -43.9% -19.2%

-55.3% 14.7% -48.4% 5.2%

USES Current Expenditures: Police Town Manager Parks and Recreation Streets Subtotal: Ending Fund Balances: Restricted for Police Restricted for Municipal Court Subtotal:

TOTAL USES

QUAIL CREEK COMMUNITIES FACILITIES DISTRICT FUND Purpose: The Quail Creek Community Facilities District (QC CFD) Fund is a blended component unit of the Town, a Special Revenue Fund that accounts for the District’s acquisition, construction, and maintenance of major capital facilities within the District boundaries. District funds are restricted for District purposes only.

The QC CFD budgeted fund balance is unchanged from last year. The District levies a property tax to pay for debt service and operations. The District consumes its operational resources to pay for District administration, street and park maintenance costs. It requires a subsidy from the developer to pay the portion of debt service not sufficiently funded by the property tax levy.

QC CFD FUND $1

Services:  Maintain and landscape District streets  Maintain portions of Quail Creek Veteran’s Municipal Park  Pay debts

$0 Ending Fund Balance

2016 Actual -

2017 Estimate -

2018 Budget -

QUAIL CREEK COMMUNITIES FACILITIES DISTRICT FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Taxes Investment Earnings (Losses) Miscellaneous Subtotal:

$ 408,402 $ 454,340 $ 454,340 $ 454,340 $ 508,470 (116) 636,349 506,410 506,410 540,520 195,220 1,044,635 960,750 960,750 994,860 703,690

11.9% -61.5% -26.8%

11.9% -63.9% -29.3%

-100.0% -100.0% -100.0%

$ 1,051,150 $ 1,165,750 $ 1,165,750 $ 1,112,960 $ 703,690

-39.6%

-36.8%

3,570 16,510 27,330 47,410

-24.0% -19.0% 114.0% 25.2%

70.0% 10.8% 31.4% 25.4%

365,000 286,780 4,500 656,280 703,690

-36.0% -17.7% 0.0% -100.0% -41.8% -39.6%

143.3% -32.8% 0.0% -100.0% -39.0% -36.8%

$ 1,051,150 $ 1,165,750 $ 1,165,750 $ 1,112,960 $ 703,690

-39.6%

-36.8%

Other Sources: Transfers In Face amount of refunding debt Payments to Refunded Debt Escrow Subtotal: Beginning Fund Balance: Restricted for QC CFD Subtotal: TOTAL SOURCES

6,515 6,515

9,825,000 9,825,000 9,997,700 (9,620,000) (9,620,000) (9,879,600) 205,000 205,000 118,100

USES Current Expenditures: General Government Streets Park and Recreation Subtotal: Debt Service: Principal Interest Other Debt Issuance Costs Subtotal: Subtotals Combined: Ending Fund Balance: Restricted for QC CFD Subtotal: TOTAL USES

298 $ 10,020 29,728 40,046 450,000 557,085 4,019 1,011,104 1,051,150

4,700 $ 20,390 12,770 37,860 570,000 348,390 4,500 205,000 1,127,890 1,165,750

2,100 $ 14,900 20,800 37,800 150,000 426,820 4,500 493,840 1,075,160 1,112,960

RANCHO SAHUARITA COMMUNITIES FACILITIES DISTRICT FUND Purpose: The Rancho Sahuarita Community Facilities District (RS CFD) Fund is a blended component unit of the Town, a Special Revenue Fund that accounts for the District’s acquisition and maintenance of major capital facilities within the District boundaries. District funds are restricted for District purposes only.

The RS CFD fund balance is budgeted to decrease by $2,144, consuming all of its available resources. The District will levy a property tax for operations and maintenance and, beginning in 2018, will levy a property tax to cover debt service costs associated with a general obligation bond issuance, whose proceeds will be used to purchase infrastructure. Developer contributions will cover any operational and debt service shortfalls.

Services:  District administration

Thousands

RS CFD FUND $3

 Streets engineering  Acquire infrastructure  Pay debts

$0 Ending Fund Balance

2016 Actual 2,144

2017 Estimate -

2018 Budget -

RANCHO SAHUARITA COMMUNITIES FACILITIES DISTRICT FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Estimated Budget Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Taxes Investment Earnings (Losses) Misc-Developer Contributions Subtotal:

2,361 $ 341 2,702

2,300 $ 250 2,550

2,300 $ 2,700 $ 250 250 5,410 2,550 8,360

Other Sources: Face amount of long-term debt Subtotal:

Beginning Fund Balance: Restricted for RS CFD Subtotal:

1,680 1,680

2,140 2,140

TOTAL SOURCES

2,702 $

4,230 $

4,230 $ 10,500 $

558 $ 558

1,160 $ 1,160

1,160 $ 1,300 $ 9,200 1,160 10,500

40,860 338,200 379,060

7,320,000 7,320,000

1676.5% -100.0% 14765.1%

-100.0% -100.0%

1413.3% -100.0% 4434.2%

100.0% 100.0%

7,699,060 181910.9% 73224.4%

USES Current Expenditures: General Government Streets Subtotal: Debt Service: Principal Interest Other Debt issuance costs Subtotal:

Capital Outlay: Infrastructure (purchased) Subtotal: Subtotals Combined: Ending Fund Balance: Restricted for RS CFD Subtotal: TOTAL USES

558

1,160

10,500

2,144 2,144

3,070 3,070

2,702 $

4,230 $

4,230 $ 10,500 $

1,840 15,600 17,440

362,950 560,000 922,950

58.6% 1403.4%

41.5% 69.6% 66.1%

6,758,670 6,758,670 7,699,060 663612.1% 73224.4%

-100.0% -100.0%

7,699,060 181910.9% 73224.4%

CAPITAL INFRASTRUCTURE IMPROVEMENT FUND Purpose: The Capital Infrastructure Improvement Fund (CIIF) is a Capital Projects Fund that accounts for the acquisition, construction, replacement, and major repairs of capital facilities and other assets.

The CIIF fund balance is budgeted to decrease $2.45 million. There are insufficient new revenue sources to pay for the Town’s capital priorities in 2018. Therefore, the Town will use resources accumulated in previous years to pay debt service and for much of the replacement costs of operating capital (e.g., vehicles, equipment, etc.), infrastructure improvements, and new facilities (see Capital Improvement Plan for more information).

CIIF Fund Services:  Construct and acquire assets and infrastructure

Millions

$7.0 $6.0 $5.0

 Manage projects

$4.0

 Pay debts

$3.0 $2.0 $1.0 $0.0 Ending Fund Balance

2016 Actual 6,470,043

2017 Estimate 6,780,660

2018 Budget 4,329,800

The ending fund balance is projected to be $4.33 million. Of this amount, $3.30 million will not be available as that amount of funding will be advanced to the Wastewater Fund to manage its deficit position. By motion the Council had assigned debt refunding savings, $361 thousand in 2018, toward future debt service payments. Lastly, $664 thousand of residual balances have been assigned for future capital projects. This amount exceeds the minimum fund balance amount required by Town policy.

CAPITAL INFRASTRUCTURE IMPROVEMENT FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Revenues: Taxes Licenses and Permits Intergovernmental Investment Earnings (Losses) Miscellaneous Subtotal: Other Sources: Capital Leases Transfers In Transfers Out Proceeds on the Sale of Assets Subtotal: Beginning Fund Balance: Restricted for Grant Projects Assigned to Interfund Advances Assigned for Town Center Assigned for Debt Service Assigned for Capital Projects Subtotal:

TOTAL SOURCES

$ 2,131,797 $ 1,912,970 $ 1,912,970 $ 1,838,740 $ 2,306,000 1,200 4,162,633 1,185,590 1,185,590 272,680 3,050,000 103,460 73,360 73,360 92,210 79,250 2,900,000 165,000 150,000 9,297,890 3,171,920 3,171,920 2,369,830 5,585,250

20.5% 157.3% 8.0% 76.1%

25.4% -100.0% 1018.5% -14.1% -9.1% 135.7%

270,000 3,258,310 58,000 3,586,310

-39.5% -33.4%

-10.0% -24.7% 16.0% -23.3%

22,000 3,250,336 3,304,840 3,304,840 3,353,790 3,304,840 600,000 231,220 231,220 231,220 231,220 1,242,579 2,339,340 2,339,340 2,885,030 3,222,600 5,092,915 5,875,400 5,875,400 6,470,040 6,780,660 $ 14,239,380 $ 14,428,570 $ 14,428,570 $ 13,516,450 $ 15,952,220

0.0% 0.0% 37.8% 15.4% 10.6%

-1.5% 0.0% 11.7% 4.8% 18.0%

$ 1,082,317 $ 1,105,000 $ 1,105,000 $ 1,187,500 $ 1,157,500 481,981 457,860 457,860 485,360 447,320 1,900 5,000 5,000 5,000 5,000 1,566,198 1,567,860 1,567,860 1,677,860 1,609,820

4.8% -2.3% 0.0% 2.7%

-2.5% -7.8% 0.0% -4.1%

5,274,360 333,100 2,564,140 1,841,000 10,012,600 11,622,420

127.4% 0.9% -52.4% 126.7% 13.2% 11.6%

377.0% 0.9% -25.1% 816.3% 98.0% 72.5%

22,000 3,353,790 3,304,840 3,304,840 3,304,840 3,304,840 231,218 231,220 231,220 231,220 361,220 2,885,035 475,930 475,930 3,222,600 663,740 6,470,043 4,011,990 4,011,990 6,780,660 4,329,800 $ 14,239,380 $ 14,428,570 $ 14,428,570 $ 13,516,450 $ 15,952,220

0.0% 56.2% 39.5% 7.9% 10.6%

0.0% 56.2% -79.4% -36.1% 18.0%

286,327 10,182 (447,934) (151,425)

5,381,250 5,381,250

300,000 4,326,580 50,000 4,676,580

USES Debt Service: Principal Interest Other Subtotal: Capital Outlay: General Government Public Safety Highways and Streets Culture and Recreation Subtotal: Subtotals Combined: Ending Fund Balance: Restricted for Grant Projects Assigned to Interfund Advances Assigned for Debt Service Assigned for Capital Projects Subtotal:

TOTAL USES

797,811 372,766 4,419,117 613,445 6,203,139 7,769,337

2,319,220 330,000 5,387,500 812,000 8,848,720 10,416,580

1,105,840 330,000 3,421,170 200,920 5,057,930 6,735,790

WASTEWATER FUND Purpose: The Wastewater Fund is an Enterprise Fund used to account for sewer service operations and the acquisition and construction of capital assets associated with this line of business.

The Wastewater Fund budgeted ending balance is expected to decrease by $622 thousand. A financial plan and rate study, currently underway, are expected to call for rate increases by mid-year. New growth, resulting in connection fees, is expected to pick up 2018. Overall, revenues are expected to increase by 19.5%. Operating expenditures will increase 9.8%. The 2018 budget allocates additional support towards billing and collections, including $150 thousand for bad allowances. Moreover, as the system ages, more funds are needed for rehabilitation, repair and maintenance. Transfers in of $1.19 million from the General Fund will be used to pay for the construction of new retention basins that will increase the number of annual recharge credits generated by the utility. The debt service net revenue coverage ratio is expected to be 1.29, exceeding the 1.20 is the minimum required by the WIFA system revenues loan agreement.

Wastewater Fund Services:  Utility billing and collections  Treat raw sewage

Millions

$0.0

-$1.0

-$2.0

 Recharge reclaimed water

-$3.0

 Pay debts

-$4.0

-$5.0

-$6.0 Ending Fund Balance

2016 Actual (3,849,528)

2017 Estimate (4,939,390)

2018 Budget (5,561,820)

The ending fund balance is projected to be -$5.56 million. Of this amount, $2.11 million and $750 thousand are restricted for debt service and rate stabilization, respectively, pursuant to debt agreement provisions. The General and CIIF funds will advance $8.42 million to cover the fund’s unassigned deficits. The longer term outlook for the fund is addressed in the 5 Year Plan section of the Budget.

WASTEWATER FUND SOURCES AND USES OF FUNDS 2016 Actual Amount

Adopted Budget

2017 Amended Budget

Estimated Actual

2018 Budget Amount

% Change From From Amended Estimated

SOURCES Operating Revenues: User Charges Subtotal:

$ 3,198,886 $ 3,235,040 $ 3,235,040 $ 3,203,990 $ 3,329,920 3,198,886 3,235,040 3,235,040 3,203,990 3,329,920

2.9% 2.9%

3.9% 3.9%

Non-Operating Revenues: Grants Investment Earnings (Losses) Sewer Connection Fees Long-term Storage Credits Miscellaneous Subtotal: Subtotal:

250,000 (42,924) 194,696 22,112 423,884 3,622,770

(61,820) 165,680 22,500 126,360 3,361,400

(25,640) 146,770 103,020 82,150 306,300 3,510,290

(69,610) 546,880 136,220 74,650 688,140 4,018,060

12.6% 230.1% 231.8% 444.6% 19.5%

171.5% 272.6% 32.2% 100.0% 124.7% 14.5%

Other Sources: Transfers In Transfers Out Proceeds on Sale of Assets Proceeds of Long-Term Debt Subtotal:

733,244 390,351 1,123,595

1,698,000 375,000 2,073,000

90,000 90,000

1,190,000 (3,360) 1,186,640

-29.9% -100.0% -42.8%

1222.2% 1218.5%

2,108,048 2,108,050 2,108,050 2,108,050 2,108,050 750,000 750,000 750,000 750,000 750,000 (6,500,672) (6,609,680) (6,609,680) (6,707,580) (7,797,440) (3,642,624) (3,751,630) (3,751,630) (3,849,530) (4,939,390) $ 1,103,741 $ 1,682,770 $ 1,682,770 $ (249,240) $ 265,310

0.0% 0.0% 18.0% 31.7% -84.2%

0.0% 0.0% 16.2% 28.3% -206.4%

$ 1,540,472 $ 1,574,230 $ 1,574,230 $ 1,528,580 $ 1,669,680 271,174 405,990 405,990 391,500 505,430 1,811,646 1,980,220 1,980,220 1,920,080 2,175,110

6.1% 24.5% 9.8%

9.2% 29.1% 13.3%

Beginning Fund Balance: Restricted for Debt Service Restricted for Rate Stabilization Fund Unassigned (Deficit) Subtotal:

TOTAL SOURCES USES Current Expenditures: Wastewater Utility Finance-Billing & Collections Subtotal: Debt Service: Principal Interest Subtotal:

1,460,427 863,447 2,323,874

1,569,330 832,080 2,401,410

1,598,990 832,080 2,431,070

1,648,620 782,470 2,431,090

5.1% -6.0% 1.2%

3.1% -6.0% 0.0%

Capital Outlay: Plant, Conveyance and Equipment Subtotal: Subtotals Combined:

817,749 817,749 4,953,269

1,380,200 1,380,200 5,761,830

339,000 339,000 4,690,150

1,220,930 1,220,930 5,827,130

-11.5% -11.5% 1.1%

260.2% 260.2% 24.2%

2,108,048 2,108,050 2,108,050 2,108,050 2,108,050 750,000 750,000 750,000 750,000 750,000 (6,707,576) (6,937,110) (6,937,110) (7,797,440) (8,419,870) (3,849,528) (4,079,060) (4,079,060) (4,939,390) (5,561,820) $ 1,103,741 $ 1,682,770 $ 1,682,770 $ (249,240) $ 265,310

0.0% 0.0% 21.4% 36.4% -84.2%

0.0% 0.0% 8.0% 12.6% -206.4%

Ending Fund Balance: Restricted for Debt Service Restricted for Rate Stabilization Fund Unassigned (Deficit) Subtotal:

TOTAL USES

“A new fiscal year gives us a moment to reflect on the things that work so well for our community, as well on those where we strive to break new ground. In keeping with our ideals, we have modified our Strategic Plan to span 20162019. This framework will guide our endeavors toward continual improvement in economic development, infrastructure, planning for the future, organizational effectiveness and quality of life for all Sahuaritans.” – L. Kelly Udall, Town Manager

Major items and projects proposed for inclusion in the Town’s budget are tied closely to the Town’s Strategic Plan. The Town of Sahuarita’s Strategic Plan focus areas are listed below. Throughout the Department Summaries and Performance Measures section you will find these focus areas referenced by use of these icons. The icons are used in correspondence with a specific goal from the Strategic Plan and measurable metrics to show progress toward the goals of our Strategic Plan. For an example of such use of icons throughout this section, please see the following page.

MAYOR AND COUNCIL DEPARTMENT INFORMATION Yisel Suarez, Executive Assistant ysuarez@sahuaritaaz.gov 520-822-8816

MISSION STATEMENT: The Mayor and Council set public policy and provide staff with direction to meet community needs. TOWN COUNCIL (0.0 FTE, $137,550) The Council establishes goals and objectives, adopts public policies, and approves the annual budget to meet the community’s needs. All powers of the Council are exercised by ordinance, resolution, order, or motion. The Town Council is comprised of seven elected officials. Council Members serve overlapping four-year terms with elections held in the Fall of even-numbered years, with a Mayor and Vice Mayor selected by the Council after each election. As the Town’s governing body, the Council establishes goals and objectives, adopts public policies, and approves the annual budget to meet the community’s needs. All powers of the Council are exercised by ordinance, resolution, order, or motion.

-------------------------------------- TOWN COUNCIL MEMBERS --------------------------------------

Costs by Category $140,000

$120,000 $100,000

Capital

$ -

$80,000

Other

$62,850

$60,000

Supplies

$ 5,300

$40,000

Services

$10,200

Personnel

$20,000

$59,200

FY 2016

$114,661

FY 2017

$113,860

FY 2018

$137,550

Funding 0% 0%

2018 Cost Changes Department cost has changed by

General Fund

+21%

GARS

QCCFD RSCFD

CIIF Other 100%

$ budgeted per resident: $4.57 Staffing: 7 elected officials (no FTE)

Increases Citizen survey:

Decreases No significant decreases

+$10,000 Membership to regional organization: +$10,000

Goal #1

Goal #2

Goal #3

Goal #4

Goal #5

ECONOMIC DEVELOPMENT Continue to grow the Townâ&#x20AC;&#x2122;s economic base bringing in jobs associated with retail, light manufacturing and quality commercial enterprises

INFRASTRUCTURE Provide and maintain high-quality and cost-effective infrastructure

PLANNING FOR OUR COMMUNITYâ&#x20AC;&#x2122;S FUTURE Promote planned growth that fosters high-quality and diverse development, facilitates sustainable infrastructure and assures quality services

ORGANIZATIONAL EFFECTIVENESS Foster an organizational culture that embraces change, creativity, innovation and calculated risk to ensure proactive, consistent, efficient and accountable service to our community

QUALITY OF LIFE Maintain a high quality of life that makes Sahuarita a community of choice for residents and business investment. Encourage a unified community identity

Expand the local economy through a comprehensive business and industry recruitment, retention and expansion program to generate revenues and provide job opportunities for our community

ECONOMIC DEVELOPMENT

Revise the Strategic Plan for economic development Promote tourism of our community and the Green Valley Region Provide and maintain public streets and rights-of-way Provide and maintain parks, trails and recreation facilities

INFRASTRUCTURE

Maintain and operate wastewater plant and collection system to ensure system integrity Provide effective management of town-owned buildings Manage storm water drainage Complete work on major planning efforts to guide the Townâ&#x20AC;&#x2122;s future PLANNING FOR OUR COMMUNITYâ&#x20AC;&#x2122;S FUTURE Facilitate development opportunities

Plan and pursue future service delivery opportunities Deliver high-quality, business friendly services Build a financially resilient government Identify and seek opportunities to expand and advance the use of technology in the delivery of services

ORGANIZATIONAL EFFECTIVENESS

Attract, engage, and retain highly-qualified employees to create an organization of excellence Continuous improvement Effective operation of town-owned infrastructure Assure that the Town continues to be a safe community QUALITY OF LIFE Provide parks, facilities, programs and events that foster a healthy lifestyle and enhance the lives of residents. Incorporate art and culture into Town projects and event to promote the rich, culturally diverse history of Sahuarita

TOWN MANAGER DEPARTMENT INFORMATION L. Kelly Udall, Town Manager kudall@sahuaritaaz.gov 520-822-8816

MISSION STATEMENT: The Town Manager directs and coordinates staff to implement Town Council policies and programs with the highest level of professionalism and customer service. As a division of the Town Manager’s Department, Economic Development seeks to attract and retain a diversity of firms to create and sustain high-wage jobs, generating wealth and revenues for the community.

ADMINISTRATION (4.0 FTE, $540,420) The Town Manager provides the professional leadership necessary to implement and administer the programs and policies established by the Mayor and Council. The Manager informs and advises the Council on matters of concern to the Town. The Manager studies, evaluates, and proposes alternative solutions for Council consideration, prepares and implements the annual financial plan, and coordinates the activities of all departments under his authority with the goal of providing high levels of comprehensive and effective services to the residents.

ECONOMIC DEVELOPMENT (2.0 FTE, $256,360) The purpose of economic development is to attract and retain appropriate commercial and industrial development businesses, offering residents high-paying employment opportunities. Cultivating relationships with company representatives, landowners, real estate brokers, governmental agencies, and Mexico is critical to the mission for economic development.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

Implemented Envisio software – Strategic Plan updates



165,000 Grant Award from the Freeport McMoRan Foundation for the Sahuarita Advanced Manufacturing and Technology Center (SAMTEC)



Application submission for EDA’s Public Works and Economic Adjustment Assistance Program for SAMTEC (Pending Funding Approval)



Completion and Adoption of Sahuarita’s Branding and Marketing Communication Plan



Partnered with the Small Business Development Center for the BizHUB EDGE (Engergize, evelop, Grow, Excel) Business Assistance Program

Town Awards 

Recognized (4) Town of Sahuarita Employees in the 2016 Employee Awards (2) Above and Beyond: Julie Strzyzewski and James Oviedo and (2) Manager’s Choice in Excellence Awards: Victor Gonzalez and Ted Rodriquez



Town received the Sterling Agency Award from the Universal Public Procurement Certification Council for meeting standards of professional excellence three consecutive years – March 2017

Costs by Category $900,000 $800,000

$700,000 $600,000

Capital

$ -

$500,000

Other

$ 28,150

$400,000

Supplies

$ 15,030

$300,000

Services

$ 40,160

$200,000

Personnel

$713,440

$100,000 $0

FY 2016

FY 2017

$795,863

$774,180

FY 2018

$796,780

Funding 0%

0% 1% 0%

2018 Cost Changes General Fund

Department cost has changed by

GARS

+3%

QCCFD RSCFD

CIIF Other

Increases

Decreases

Net pay and benefit Reduction in available changes: grant funding: +$36,000 -$10,500 Performance mgmt Marketing materials and software support: other costs: +$6,500 -$10,000

99%

$ budgeted per resident: $26.47 Staffing: 2016 6.0 FTE 2017

6.0 FTE

2018

6.0 FTE

Goal #1

Implement directives and goals to achieve results in the Strategic Plan Focus Areas identified by Mayor and Council to include, but not limited to: Economic Development, Infrastructure, Planning for Our Community's Future, Organizational Effectiveness, and Quality of Life.

Goal #2

Ensure the alignment and development of strategic plans in conjunction with Mayor and Council priorities while providing organizational leadership and management.

Goal #3

Provide effective and efficient constituent services.

Goal #4

Provide responsible, fiscal management.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Number of Strategic Plan objectives achieved in a year

NEW MEASURE

35/107

Percentage of Strategic Plan complete within the year

NEW MEASURE

33%

Successful development agreements adopted by Council relational to Strategic Plan goals

NEW MEASURE

YES

Number of professional development programs (three employee appreciation programs, educational reimbursement, Employee Morale Committee).

NEW MEASURE

Number of procurement contracts approved by Council

Major procurement audit findings

Number of Manager's all-employee briefings (Minute with the Manager)

Number of Town-wide community events

N/A

34 Parks 17 Townwide

Percentage of residents who believe that the Town of Sahuarita government acts in the best interests of the community (Biannual Citizen Survey)

N/A

60%

Percentage of residents rating the Town as a good or excellent place to live (Biannual Citizen Survey)

N/A

95%

Funding of community service programs (emergency housing and food, animal control, WW utility assistance)

>$200K

Percentage difference of manager proposed budget and Council adopted budget

NEW MEASURE

98%

Number of departments operating within adopted budget

NEW MEASURE

100%

Percentage of CIP projects complete within the year relational to the Strategic Plan

NEW MEASURE

30%

Goal #1

Build on Sahuaritaâ&#x20AC;&#x2122;s abundant assets and advantages.

Goal #2

Expand Sahuaritaâ&#x20AC;&#x2122;s internal capacity to facilitate and accommodate economic development.

Goal #3

Retain and grow existing economic drivers and employers.

Goal #4

Number of sites and acres certified shovel-ready

Goal #5

Strengthen present and future employment and business centers through investment

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

N/A?

Number of Retail Prospects

N/A

Number of major employers visited

N/A

Number of targeted sector prospects

NEW MEASURE

1-site/ 100-acres

Number of targeted sector prospects

NEW MEASURE

N/A

94,000

NEW MEASURE

Number of businesses assisted with retention

Number of user visits to the BizHub

Number of visitors to Sahuarita attractions

Number of jobs added in Sahuarita

LAW DEPARTMENT INFORMATION Daniel J. Hochuli, Esq., Town Attorney dhochuli@sahuaritaaz.gov 520-822-8832

MISSION STATEMENT: The mission of the Department of Law is to protect the Town, its resources, and its residents in civil and criminal matters.

CIVIL DIVISION (3.0 FTE, $493,840) The Civil Division of the Department of Law provides legal advice to the Town Council, Town Manager, and other Town Departments, in order to assure compliance with state and federal laws. This includes compliance with the Arizona open meeting laws, disclosure of public records laws, and many other laws that are peculiar to municipalities. The Civil Division also prepares agreements with developers for provision of infrastructure, coordinates the acquisition of land for public uses, works with the Town Clerk to assure compliance with all election laws and regulations, and performs other legal tasks as required. The Town Attorney is required by state law to read, approve, and sign all contracts, intergovernmental agreements, resolutions, and ordinances prior to their submission to the Town Council, in order to assure that not only is the document in compliance with state law, but also within the authority of the Town.

CRIMINAL DIVISION (2.0 FTE, $204,580) The Criminal Division of the Department of Law is responsible for the prosecution of misdemeanor crimes that occur within the Town’s boundaries. It represents the State in all such cases, and in so doing safeguards the constitutional rights of defendants and the rights of victims and their families. Its mission is to ensure that justice is served and that a fair, thoughtful, and appropriate resolution is achieved in all matters.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

The department continues to work cooperatively with Town staff, developers and merchants to allow forward movement of economic development.



The addition of a full-time prosecuting attorney allowed the Deputy Town Attorney to spend significantly more time on civil matters, allowing the Civil Division to handle more matters in-house, and decreased the turnaround time for responses to departments and the public.



The Civil Division continues to work with the wastewater billing department to reduce delinquent accounts.



The Civil Division has worked with Town departments to reduce liability and resolve disputes, which has resulted in no lawsuits and no pending notices of claim.



The Civil Division is working on accomplishing the first bond issue for the Rancho Sahuarita Community Facilities District.



The Civil Division successfully completed a development agreement with The Crossing at Sahuarita Commercial Development.



The addition of a full-time prosecuting attorney has resulted in improved customer services to the community and police. The Prosecutor has had greatly increased contact with victims and citizens due to increased availability by being in the office full time.



The Prosecutor represents the Town on the Southern Arizona DUI Task Force, Animal Cruelty Task Force of Southern Arizona, and the Coalition Against Retail Theft (formerly the Retail Theft Summit), a multijurisdictional committee working to reduce shoplifting and retail theft in the region.



The Prosecutor has collaborated with the Grant-Funded Victim Advocate on over 50 cases and continues to work closely with the Victim Advocate to continue successful prosecution of cases.



The Criminal Division has collaborated with the Police Department to develop a brochure for businesses regarding trespass law to improve quality of life.

Costs by Category $800,000

$700,000 $600,000

$500,000 $400,000 $300,000 $200,000

Capital

$ -

Other

$ 16,350

Supplies

$ 16,700

Services

$ 43,250

Personnel

$622,120

$100,000

FY 2016

$570,336

FY 2017

FY 2018

$643,730

$698,420

Funding 0%

0% 0%

2018 Cost Changes General Fund

Department cost has changed by

GARS

+8%

QCCFD

RSCFD CIIF

Other 100%

Increases

Net pay and benefit No significant decreases changes; full year budget for Prosecutor: +$40,900 New legal software package (support): +$7,000 Public defender:

$ budgeted per resident: $23.21 Staffing: 2016 4.0 FTE 2017

5.0 FTE

2018

5.0 FTE

Decreases

+$5,000

Goal #1

Assure that Town operations comply with all federal, state and local laws and regulations by timely response to requests for legal analysis, advice and answers to legal issues.

Goal #2

Provide excellent service to internal client departments.

Goal #3

Expeditiously review Council materials to meet agenda deadlines

Goal #4

Preserve and protect victims' rights during criminal case prosecution.

Goal #5

Fair and even-handed administration of justice to all defendants.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Lawsuits filed against Town

Number of regulatory actions against Town by state or federal agencies.

100%

%100

100

175

100%

Number of cases filed

227

300

Number of cases resoled at first contact

105

200

Number of cases ending in plea agreements

200

Notices of Claim filed Losses to Town as a result of litigation (in dollars)

Contracts approved by packet deadline Project delayed to such an extent that follow-up is required by departments regarding status of requests for work from the Department of Law

Number of agenda extensions requested due to delays in legal review

Number of victim cases filed requiring victim notification Percentage of victim notices timely sent

100%

TOWN CLERK DEPARTMENT INFORMATION Lisa Cole, MMC, Town Clerk lcole@sahuaritaaz.gov 520-822-8802

MISSION STATEMENT: The mission of the Town Clerk’s Department is to uphold public trust and offer access to matters of public interest by maintaining and preserving public records and providing innovative, efficient and responsive customer service to the community. The Clerk also advocates local democracy through voter education and the conduct of impartial and accurate elections. Town communications are a division of the Clerk’s office, answering all media inquiries for the town, engaging the public and cultivating awareness and engagement for Town of Sahuarita programs, services and events.

TOWN CLERK (4.0 FTE, $369,910) The Town Clerk’s Office provides administrative support for legislative services, records and information management, public information, regulatory licensing and election services. Duties include the preparation of agendas, meeting notices and minutes; maintenance of the Town Code; administration of the appointment process to boards and commissions; safeguarding the Town seal; maintenance and preservation of accurate Council records; oversight of the Records and Information Management Program; dissemination of public information; processing of liquor, business and bingo licenses; and the administration of elections.

ELECTIONS (0.0 FTE, $0) The Elections Division administers all municipal and special district elections in accordance with legal requirements. The Town Clerk oversees the candidate nomination process; initiative, referendum and recall petitions; campaign finance; financial disclosure statements; and voter education and information. Staff and budget are not allocated during non-election years.

COMMUNICATIONS (1.0 FTE, $208,970) The Communications Division coordinates communication programs and policies that support the goals and objectives of the Town, focusing on the innovative use of social media, digital communication, online initiatives and progressive tools to better serve and engage the community. Activities include answering all media inquiries for the Town, administration of the Town website and the production and design of newsletters, presentations, surveys, publications, promotional items, press releases and videos.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

Administered the 2016 election cycle in conformance with federal, state and local laws.



Coordinated and supported the annual State of the Town address.



Implemented an automated agenda management system to streamline the agenda meeting compilation process.



Implemented a branding style guide to establish unified and consistent town marketing.

Designed the Annual Adopted Budget for fiscal year 2017 that won the Distinguished Budget Presentation Award with Special Performance Measures Recognition.

Costs by Category $600,000 $500,000 $400,000 $300,000 $200,000 $100,000

Capital

$ -

Other

$ 29,180

Supplies

$ 17,350

Services

$161,810

Personnel

$370,540

FY 2016

$450,076

FY 2017

$579,470

FY 2018

$578,880

Funding 0% 0%

2018 Cost Changes General Fund

Department cost has changed by

GARS

+0%

QCCFD RSCFD

CIIF Other

Increases

Net pay and benefit Elections changes: (cyclical): +$11,400 New software and support: +12,400

100%

$ budgeted per resident: $19.23 Staffing: 2016 5.0 FTE 2017

5.0 FTE

2018

5.0 FTE

Decreases

Travel, training, and memberships: +$5,600 Special events (State of the Town): +$4,700

-$39,100

Goal #1

Provide courteous, efficient and responsive customer service to the community.

Goal #2

Develop and enhance online self-service options

Goal #3

Enhance public access to electronic Town records

Goal #1

Enhance civic engagement through online presence, social media and public participation

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Percentage of customer survey ratings meeting or exceeding expectations

100%

Percentage of public records requests not completed within 72 Hours

25%

30%

Percentage of business licenses issued within seven business days of receipt

99%

98%

Percentage of audio minutes posted to website within three business days after meeting

100%

Percentage of approved meeting minutes posted to the website within two business days after meeting

100%

NEW MEASURE

6,500

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Number of Twitter followers

1,707

1,850

2,000

Number of Facebook likes

1,355

1,650

1,850

Number of digital newsletter recipients

1,082

1,200

1,500

163,001

185,000

200,000

128

150

100

Number of public records requests received

Number of pages of public records available on the Town website

Number of visits to Town website Number of media inquiries

FINANCE DEPARTMENT INFORMATION A.C. Marriotti, CPA, Finance Director amarriotti@sahuaritaaz.gov 520-822-8844

MISSION STATEMENT:

The mission of the Finance Department is to protect the Town’s financial and technological resources, to provide quality information about the Town’s finances to residents and stakeholders, and to provide superior technological services to all departments.

FINANCE (5.0 FTE, $553,960) Finance provides a variety of financial services to the Council, Town staff, and residents. Services include accounting and financial reporting, budgeting, payroll, accounts payable, utility billing and special financial analyses.

RISK MANAGEMENT (0.0 FTE, $301,660) The division provides centralized claim management services over property and general liability claims via membership in the Arizona Municipal Risk Retention Pool.

INFORMATION TECHNOLOGY (4.0 FTE, $759,160) Technology provides advising, service and support for all departments of the Town; responsibilities include the network infrastructure, security, administration, attached devices and software in addition to technical training, contract negotiation, project management, maintenance and support.

WASTEWATER BILLING & COLLECTIONS (2.0 FTE, $505,430) The division provides monthly sewer billing and collections for the Wastewater Utility. Services also include compiling and analyzing customer consumption data, responding to customer inquiries/requests and maintaining customer accounts, cash handling, and extensive collection efforts on delinquent customer accounts.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------2017 Accomplishments 

  

   

Received awards from the GFOA for the Town’s 2017 Budget and Comprehensive Annual Financial Report for the fiscal year ended June 30, 2016. Completed a $10+ million debt refunding which resulted in net present value savings of nearly $1.2 million. Implemented a new time and attendance system that will result in annual cost savings of almost $20,000. Expanded use of the Arizona Department of Revenue debt setoff program to increase collection of delinquent wastewater customer accounts. Renegotiated contract with wastewater billing ERP vendor, reducing credit card fees by 24 basis points. Working with consultants to develop a financial plan and rate study for the Wastewater Enterprise Fund. Deployed public WiFi at Anamax Park. Built-out IT network and infrastructure on new Wastewater building.



Upgraded or replaced numerous front and back-end IT systems.

2018 Goals   

    

Expected issuance of general obligation bonds for the Rancho Sahuarita CFD. Roll-out and implement new travel and training policies, procedures, and forms. Provide Council with an update to the Town Code that implements recommendations derived from the Wastewater Enterprise Fund financial plan and rate study. Issue high quality financial reports for submittal to the GFOA budget and CAFR award programs. Complete and adopt the Strategic Plan for Technology. Purchase and deploy 45 new computers. Town-wide MS Office upgrade to 2016 version. Upgrade computer and A/V equipment in all conference rooms at Town Hall.

Costs by Category $2,500,000

$2,000,000

$1,500,000

$1,000,000

$500,000

Capital

$190,000

Other

$502,660

Supplies

$ 68,680

Services

$493,480

Personnel

$865,390

FY 2016

$1,609,243

FY 2017

$2,002,280

Funding

FY 2018

$2,120,210

2018 Cost Changes Department cost has changed by

24%

+6%

General Fund GARS

QCCFD RSCFD

CIIF 67%

Wastewater

Increases

Decreases

Net pay and benefit Timekeeping software changes: and equipment: +$17,500 -$14,900 Wastewater collections Wastewater financial efforts: plan and rate study: +$67,500 -$25,000 Additional allowance for Technology strategic bad debt: plan: +$50,000 -$20,000

$ budgeted per resident: $70.45 Staffing: 2016 10.0 FTE 2017

11.0 FTE

2018

11.0 FTE

Software and technical Technology capital support (offsite projects: backups): +$32,500 -$10,000 Insurance premiums: +$15,700

Goal #1

Protect the Town's financial resources through compliance with laws, policies, and procedures.

Goal #2

Protect the Town's financial resources by minimizing risk exposure to the Town.

Goal #3

Maintain healthy reserves.

Goal #4

Provide quality information to all stakeholders.

Goal #5

Perform work efficiently and make continuous improvements.

Goal #6

Ensure timely Wastewater Utility billing practices.

Goal #7

Enhance technology customer satisfaction by meeting or exceeding established service levels.

Goal #8

Ensure the Town's technology assets are maintained, reliable, and secure.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Number of audit findings, reportable conditions, and/or violation notices.

Average number of days after which month-end bank reconciliations are completed.

Number of general liability or property claims filed.

<10

Ratio of net actual and estimated losses to net Risk Management Division expenses.

6.1%

15.1%

<20.0%

Ratio of spendable General Fund ending fund balances to General Fund expenditures (healthy ≥0.25).

1.06

1.01

0.72

Accuracy rate of previous year's Comprehensive Annual Financial Report.

100%

≥99.9%

Percent of financial reports that are issued timely, within defined timeframes.

100%

99%

100%

Ratio of Finance Division cost to budgeted Town-wide operational costs.

3.00%

2.73%

2.48%

Ratio of Technology Division cost to budgeted Town-wide operational costs.

3.40%

2.54%

3.41%

Wastewater Billing Division cost per customer.

$5.78

$4.70

$4.78

Monthly sewer bills sent within the first two business days of the month.

100%

Number of service tickets submitted.

1,237

1,500

1,300

Percent of service requests completed within defined timeframes.

88.7%

85%

87%

Average customer survey score for quality of services.

≥3.0

Number of network outages during business hours.

Average duration of outages in minutes during business hours.

Number of audit findings, reportable conditions, and/or violation notices.

Number of awards received for high quality financial reporting.

HUMAN RESOURCES DEPARTMENT INFORMATION Michelle Malott, Human Resources Director mmalott@sahuaritaaz.gov 520-822-8812

MISSION STATEMENT:

The mission of the Human Resources Department is to work collaboratively with all Town departments to recruit, develop and retain a high-performing workforce promoting a healthy, safe and productive work environment and providing quality services to the public.

HUMAN RESOURCES (2.0 FTE, $279,940) -------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------



The Town’s Human Resources Analyst was awarded the Town’s recognition award “Above and Beyond Award” for her efforts in researching, planning and coordinating the testing process for sworn employees for new positions, promotions and special assignments. In November 2016 the Employee Wellness Committee coordinated an Employee Wellness Fair and the theme was “Fall into Health”. The event was very successful with 22 vendors and over 70 employees in attendance. Coordinated with United Health Care and the local Walgreen’s pharmacy to provide on-site flu shots to employees and their spouse.



Sworn testing processes and policies have been fully created and implemented. All internal and external postings will utilize the new process and policies.



Completed an Evacuation Policy and Plan and conducted a fire drill in November 2016. The fire drill went very well and was completed in an orderly fashion and only took 7 minutes to evacuate everyone from the building.



A new safety slogan and logo was created “Be smart! Use Safety from the Start”. Magnets will be created and placed on Town vehicles and in employee offices.



Provided training for all directors, managers and supervisors on the topic of industrial injuries / workers compensation and the new program “TriangeNow”.



Revised the Town’s Personnel Policy Manual to reflect a newly created policy for Light Duty. This policy provides a structured and more efficient process for employees who have been released by a doctor to perform light duty.



Continue to serve as a member of the Pima Association of Government Travel Reduction Program Regional Task Force. Represent the Town at Task Force meetings and Travel Coordinator trainings. The Town earned the Bronze Award in 2016 for the TRP Recognition Program for achieving a response rate of 80.8% response on the TRP Survey.



Continue to serve as a member of the Healthy Pima Employer Wellness Alliance. Represent the Town at monthly meetings and Wellness Trainings.

Costs by Category $300,000 $250,000

$200,000 $150,000 $100,000

$50,000

Capital

Other

$ 16,380

Supplies

$ 17,950

Services

$ 13,370

Personnel

$232,240

FY 2016

FY 2017

$242,998

$286,680

Funding 0% 0%

FY 2018

$279,940

2018 Cost Changes

0% 0% 0%

Department cost has changed by

-2%

General Fund GARS

QCCFD RSCFD

CIIF Other

Increases Overtime:

Capital projects: +$3,200 -$18,000

HR software licensing Wellness program and support: related costs: +$8,000 -$2,500 Employment service awards: +$2,000

100%

$ budgeted per resident: $9.30 Staffing: 2016 2.0 FTE 2017

2.0 FTE

2018

2.0 FTE

Decreases

Goal #1

Annually evaluate and update total compensation packet to maintain competitive wages and benefits to recruit and retain quality professional staff

Goal #2

Monitor that staffing levels are appropriate to provide internal and external customers with excellent service

Goal #3

Promote safe workplace practices by providing education and training to ensure the health and welfare of employees and the public

Goal #4

Evaluate methods for fostering employee engagement and an effective evaluation system

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

30%

31%

3.43%

3.40%

Average years of service

6.9

7.3

7.5

Average number of all employees on the payroll during the reporting period (includes Elected Officials)

140

142

145

Number of full and part-time positions that required external recruitment during the reporting period

4.93

4.90

Total number of OSHA Recordable Accidents / Injuries for all Town employees

Total number of injury cases with days away from work

Total number of injury cases with restrictions or job transfer

Longest number of days with no injuries

194

150

200

Percentage of employee performance reviews completed on schedule

47%

75%

90%

Percentage of employees who left employment during the reporting period

11%

10%

Town provided benefit expenditures as a % of salary expenditures (medical, dental, life, holiday, vacation, sick leave, retirement) Average pay for performance increase

Ratio of town staff to Sahuarita population (1:1000)

Number of employee formal grievances filed during the reporting period

PLANNING AND BUILDING DEPARTMENT INFORMATION Sarah More, Planning and Building Director smore@sahuaritaaz.gov 520-822-8853

MISSION STATEMENT: The mission of the Planning and Building Department is to ensure the safety of the public through building and fire code education, professional assistance, and enforcement; and plan for Sahuarita’s future physical, environmental, economic, and cultural needs, and manage development in the community.

PLANNING AND ZONING (5.0 FTE, $583,540) The Planning and Zoning Division reviews all building plans, business licenses, development plans and subdivision plats for zoning compliance. We prepare and revise the General Plan and the Zoning Code and review proposals for such amendments as well as rezonings, conditional uses and variances.

BUILDING SAFETY (7.0 FTE, $773,500) The Building Safety Division reviews building plans for permitting, issues permits and inspects construction of new development. We assist the public and applicants in preparing submittals and answer questions about code compliance. We perform annual fire inspections of commercial developments and assure subdivisions meet fire codes.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------FY 17 Accomplishments

FY18 Goals



Continued excellent track record of on-time reviews and service. 98% of building plan reviews were completed in 10 business days.



Major streamlining efforts for Zoning Code adopted, including digital message signs and conditional use processes.



Recipient of Arizona Planning Association’s 2016 Best General Plan award for Aspire: 2035 and MPA Common Ground finalist for Sahuarita Farms Specific Plan.



Implemented steps toward enhanced customer selfservice for planning and building processes.



Major Projects: The Crossing at Sahuarita, The Corner at Rancho Sahuarita, American Southwest Credit Union, Circle K, Dollar Tree, Fry’s Clicklist, Fry’s Fuel Facility, UCHC Pediatric Clinic, Sprouts



Processed: 1 new Specific Plan, 1 Specific Plan Amendment, 3 Development Plans, 5 Landscape Plans, 3 Tentative Plats, 4 Final Plats, 1 Conditional Use Permit, 1 Variance, 2 Comprehensive Sign Plans, and 4 zoning code amendments.



Project Partner booklet was enhanced to digital format for easier circulation to permit stakeholders.



Consistently meet or exceed processing times for plan reviews and inspections. Continue to evaluate/refine zoning codes for opportunities to modernize and streamline, including content-neutral sign regulations and streamlined residential zones. Implement new technology, particularly for permitting tracking software, online submittals, electronic plan review, and GIS. Ensure that our technology enables the best possible customer service. Work with stakeholders on evaluating the 2018 International building codes with the goal of adopting them in FY19.

Costs by Category $1,600,000

$1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000

Capital

45,000

Other

17,480

Supplies

15,380

Services

83,060

Personnel

$1,196,120

$200,000 $0

FY 2016

$1,166,020

FY 2017

$1,239,460

FY 2018

$1,357,040

Funding 2018 Cost Changes

0% 0%

Department cost has changed by

+9%

General Fund GARS

QCCFD RSCFD

CIIF Other 97%

Increases

Net pay and benefit No significant decreases changes: +$37,400 New development services software licensing and support: +$21,400 Outsourced expedited plan review: +$10,000

$ budgeted per resident: $45.09 Staffing: 2016 12.0 FTE 2017

12.0 FTE

2018

12.0 FTE

Decreases

Goal #1

Effective and efficient development review

Goal #2

Streamlining and modernization of the zoning code

Goal #3

Maintenance and updating as necessary of the General Plan

Goal #4

Provide excellent customer service

Goal #1

Complete 100% of inspection stops the next day or when requested.

Goal #2

Complete single family residence (from a model plan) plan reviews within 5 business days of a complete submittal

Goal #3

Complete commercial plan reviews within 10 business days of a complete submittal.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Number of Development Plans reviewed (in process) during the reporting period

Number of Plats reviewed (in process) during the reporting period

100%

Number of zoning code amendments initiated

Number of zoning code amendments adopted

Number of major general plan amendments processed

Number of required General Plan updates performed

Percentage of positive comment cards received

100%

Percent of zoning complaints investigated within 3 business days of the complaint

100%

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Total number of building inspection stops

4,538

4,300

4,400

Percentage of building inspection stops completed on time or when requested

100%

277

230

260

Average time for single family residence (from a model plan) plan review (in business days)

Percentage of single family residence (from a model plan) plan reviews completed within 5 business days of a complete submittal

100%

Total number of permits issued - Commercial

Average time for commercial plan reviews (in business days)

50%

85%

90%

Percent of reviews completed within target goal (4 weeks)

Total number of permits issued - Residential

Percentage of commercial plan reviews completed within 10 business days of a complete submittal

PARKS AND RECREATION DEPARTMENT INFORMATION Deborah Summers, Parks and Recreation Director dsummers@sahuaritaaz.gov 520-822-8894

MISSION STATEMENT: The mission of the Parks and Recreation Department is to provide parks, natural areas, facilities, programs, and services that preserve and enhance quality of life for the Sahuarita community.

ADMINISTRATION & EVENTS (3.7 FTE, $487,000) Leadership, support and resources for Department staff so that high quality recreation services and park facilities can be provided for Sahuarita residents. Provide administrative support to the Parks and Recreation Commission and the Sahuarita Parks Foundation. Planning and implementing the Town’s events, the Sahuarita Teen Advisory Council (STAC) events and volunteer needs for all the Town’s events. Coordination of the public special event permitting process which includes Town sponsored events, STAC events and publicly driven special event permits year round.

RECREATION (7.6 FTE, $431,590) Various recreational programs are developed through the Anamax Recreation Center including joint-use facilities with the Sahuarita Unified School District. An assortment of classes and programs for infants and toddlers to adults and seniors are offered to develop and encourage lifelong recreation users. Park facilities use and rentals are coordinated and permitted for the general public and adult and youth organizations.

FACILITIES (5.0 FTE, $1,021,070) Operate and maintain the Town’s 107 acres of park lands. This includes monitoring new park facility construction and parks and recreation facility and vehicle maintenance. Park acreage consists of six Town parks, including one joint use Town-School Park and management of the Adopt-A-Park Program.

-------------------------------------- DEPARTMENT HIGHLIGHTS --------------------------------------



Work began on design of the New Maintenance Facility & Infrastructure project with construction happening in the following year



New, wheelchair friendly pour in place rubber surfacing was installed in the Anamax Recreation Center Sensory Play area

The return of a public aquatics program began in May of 2017 in partnership with School District (SUSD) and the YMCA at the SUSD Aquatics Center



Six new programs for youth and adults are being scheduled to start in spring and summer of 2017



The Anamax Victory Community Garden re-opened as a result of cooperation and assistance of the Sahuarita Community Food Bank who agreed to developing and operating the facility for use by the public



The Anamax Park Master Plan has been revised to include another youth baseball field

Two Juan Batista de Anza Trail projects have moved into the planning stage with partners including acquisition of the alignment to the south



The Anamax Recreation Center received a brand new sign on front of the building and new divider curtains inside

The Sahuarita Teen Advisory Council (STAC) partnered with Pima Association of Governments (PAG) to create a Distractive Driving Public Service Announcement



Attendance doubles at the annual Winter Festival and Holiday Light Parade



A live music concert series began at Sahuarita Lake Park



Much needed erosion bank protection was completed at North Santa Cruz Park for increased safety of park users



Many park equipment replacement projects were completed throughout the parks to increase safety, and improve aesthetics (shade structures, park benches and tables)

 



Fiesta Sahuarita changed to March

Costs by Category $2,000,000 $1,800,000 $1,600,000

$1,400,000

Capital

$1,200,000

Other

$ 152,290

Supplies

$ 195,590

$600,000

Services

$ 563,030

$400,000

Personnel

$1,028,750

$1,000,000 $800,000

$200,000 $0

FY 2016

$1,562,061

FY 2017

$1,868,670

Funding

FY 2018

$1,939,660

2018 Cost Changes Department cost has changed by

1% 1%

0%0% General Fund GARS

QCCFD

+4% Increases

Decreases

Net pay and benefit changes: +$38,200

Capital projects: -$108,000

RSCFD

Staffing changes (+1.0 FTE): +$37,200

CIIF

Utilities:

Other

Maintenance and safety supplies: +$15,800

98%

+$22,500

QCMV Park supplies: +$14,700 Special event services and supplies: +$10,900

$ budgeted per resident: $64.45 Staffing: 2016 15.1 FTE 2017

15.3 FTE

2018

16.3 FTE

Dog licensing software and support: +$10,000 New software and support: +$9,500 Custodial services: +$9,200

Goal #1

Work with Pima County, the Anza Trail Coalition, the National Parks Service, and other partners to identify funding mechanisms for the completion of the Juan Bautista de Anza National Historic Trail

Goal #2

Update recreation design standards for parks, recreation areas and trails.

Goal #3

Develop ways to enhance and balance recreational programs, activities, and events based on community needs and priorities and identify necessary funding resources.

Goal #1

Explore joint facility use with regional partners to provide efficient use of existing and new facilities.

Goal #2

Analyze and implement strategies to address current and projected parks and recreational program needs.

Goal #3

Develop and enhance online self-service options.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

In partnership with Pima County, and land owners, continue the process for trail alignment for the Juan de Batista de Anza National Historic Trail

NEW MEASURE

3,700 Square Ft.

Continue to work with the Parks and Recreation Commission and stakeholders to update the current standards

NEW MEASURE

Continued

2nd Quarter Completed

NEW MEASURE

5 BOARD MEMBERS

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

NEW MEASURE

1,432

1,000

1,200

10.58

6.6

4.75

Monthly sports field participation by user contract

1,416

1,528

1,700

Average monthly number of Ramada rentals

13.17

13.58

Move forward with a renewed mission and goals through developing a strategic plan of action to include recruitment of Board Members for the Sahuarita Parks Foundation, formerly the Sahuarita Health Foundation (SHF).

In partnership with Sahuarita Unified School District, develop ways to utilize several existing school facilities for public recreational use on an ongoing basis Average number of monthly recreation class/program participants Number of programs offered Average monthly number of other park amenities (courts, turf, and amphitheater) permits Average monthly rentals at Anamax Recreation Center

Goal #1

Analyze and implement strategies to address current and projected parks and recreational program needs

Goal #2

Maintain an active, town-wide volunteer program by developing policies and procedures to assist staff in recruiting and utilizing volunteer services

Goal #3

Work with partners on joint projects and events with the Town

Goal #1

Maintain and enhance the high quality of life and outstanding public services in Sahuarita that include public safety, Parks and Recreation and overall community appearance

Goal #3

Continue to invest in parks and recreational facilities

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Track the participation numbers at Town sponsored events, to ensure we continue to meet the needs of the community and attract regional attendance

36,725

40,000

45,000

Track the average monthly volunteer hours for the Sahuarita Teen Advisory Council (STAC), to gauge the effectiveness of the teen volunteer program

245

125

150

Track the number of Sahuarita Teen Advisory Council (STAC) events and programs per year

Track the number of events held in conjunction with the Town of Sahuarita's current partners

Track the number of permitted special events that occur within the Town, to gauge the amount of non-Town sponsored activities within the Town limits per year

Hours to complete facility maintenance work orders, to ensure we continue to provide the public with clean, safe, functional park facilities; such as Anamax Recreation Center and public park restrooms Hours to complete grounds maintenance work orders, pertaining to the general maintenance of Town Park grounds; for example, sports courts, pathways, landscaping, and inert areas Hours to complete user group field maintenance, to ensure user safety, and playability for user groups, and tournaments; such as dragging and lining fields

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

NEW MEASURE

NEW MEASURE NEW MEASURE

Hours to complete municipal league field maintenance to assist the recreation division in executing town hosted sports programs and events to ensure safety, and usability Number of graffiti incidents removed in 24 hours after reported compared to total incidents.

Facility improvement projects completed; such as picnic area improvements, playground improvements, and recreation center improvements

NEW MEASURE

DESIGN COMPLETE

BEGIN CONSTRUCTION

Design & construct new maintenance building and storage yard facility

PUBLIC WORKS DEPARTMENT INFORMATION M.J. Dillard, Public Works Director/Town Engineer mdillard@sahuaritaaz.gov 520-822-7100

MISSION STATEMENT:

The mission of the Public Works Department is to provide and maintain high-quality and costeffective infrastructure, including the transportation network, wastewater system, and drainage ways for the Sahuarita Community.

ADMINISTRATION AND ENGINEERING (3.5 FTE, $509,870) The engineering division manages public works projects within the Town’s Capital Improvement Plan (CIP), conducts reviews of public infrastructure within development projects, and manages the permitting of the floodplain, public right-of-way, and portions of development project construction. These efforts promote planned growth that fosters high quality and diverse development, facilitates sustainable infrastructure and assures quality services. The end goal of delivering public projects and coordination with private development is to provide and maintain high quality and cost-effective infrastructure including drainage ways, sewer systems, roadways, and traffic operation systems. The engineering division also participates in town-wide and regional planning efforts to guide the Town’s future and facilitate development opportunities. These efforts include coordination with regional stakeholders and agencies, including local utility providers, local property owners/developers, other Town departments, state, and federal agencies.

FACILITIES (1.0 FTE, $498,700) The Public Works Department is responsible for effective management of Town owned buildings, including the upkeep and maintenance of the Town Hall complex. Staff attends to minor remodeling projects, repairs, painting, maintaining equipment, and daily maintenance of the buildings. Facilities Staff also provide high-quality, business-and-resident-friendly services and hospitality functions, setting up rooms for meetings and special events. The availability of well-maintained public facilities, such as Town Hall Complex, encourages a unified community identity and promotes a high quality of life that makes Sahuarita a community of choice for residents and business investment.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

Construction of the Pima Mine Road Bridge Replacement was completed in January 2017. The project corrects structural deficiencies of the existing bridge and eliminates the existing 20-ton load restriction, allowing Pima Mine Road to serve as a major east-west corridor.



Pima Mine Road Bridge Replacement received the American Public Works Association (APWA) awards for Structure of the Year, Small/Rural Community at the local and state Levels. This project has now moved on for consideration at the National level.

Costs by Category $1,200,000

$1,000,000

Capital

Other

$ 13,570

Supplies

$ 37,900

$400,000

Services

$540,400

Personnel

$416,700

$200,000

$800,000 $600,000

FY 2016

$795,201

FY 2017

$1,085,650

FY 2018

$1,008,570

Funding 0%

2018 Cost Changes Department cost has changed by

-7%

General Fund GARS QCCFD RSCFD CIIF Other 100%

Increases

Decreases

Sonoran Corridor Capital projects: engineering & consultation: +$50,000 -$120,380 Custodial services: Utilities: +$15,800

-$18,200

Fire alarm monitoring Grounds maintenance: services: +$6,500 -$10,000

$ budgeted per resident: $33.51 Staffing: 2016 4.5 FTE 2017

4.5 FTE

2018

4.5 FTE

Goal #1

Deliver high-quality, business and resident friendly services

Goal #2

Provide Effective Management of Town-Owned Buildings

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Percent of reviews completed within target goal (4 weeks)

100%

Percent of PIA reviews completed within published review time frames

100%

Average time for right-of-way permit review (business days)

Percentage of annual safety inspections passed

POLICE DEPARTMENT INFORMATION John Noland, Police Chief jnoland@sahuaritaaz.gov 520-344-7000

MISSION STATEMENT: Making Sahuarita a safe place to live, work and play. POLICE DEPARTMENT (55.0 FTE, $8,120,010) The Sahuarita Police Department is comprised of two divisions. Each division has separate bureaus and each bureau has a number of employees assigned to them, sometimes separated or categorized in to teams, squads, or sections. The Field Services Division consists of the Patrol Bureau and a Traffic/SRO Bureau. The patrol bureau has six different squads. Each squad has a number of officers and a sergeant assigned to them. Patrol provides 24/7 response to crimes in progress and other policing incidents needing to be addressed by uniformed officers. The Traffic/SRO Bureau consists of Motorcycle/Traffic Enforcement Officers and a School Resource Officer. The Motorcycle Officers are assigned to patrol teams, but have the primary assignment of enforcing traffic laws and investigating traffic collisions. The School Resource Officer is assigned to address policing issues and youth educational opportunities within the Sahuarita Unified School District. The Special Services Division consists of the Investigations Bureau, Training & Professional Standards Bureau and Records Bureau. The Investigations Bureau is responsible for conducting complex investigations outside the regular capabilities of patrol officers. This bureau includes the Property & Evidence Section that has Crimes Scene Specialists (CSS). CSS are responsible for the care and custody of all evidence and property taken in by the police department and crime scene processing. The Training & Professional Standards Bureau manages training for all employees, maintains officer training records and records associated with equipment and fleet. Additionally this bureau conducts personnel investigations associated to citizen complaints. The Records Bureau manages and retains all police reports, assures compliance with state and federal laws associated with police reports and reporting practices, and handles public requests at the police department’s front counter and requests by phone.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

The Department implemented or further developed multiple IT projects to assist in the management and training of personnel such as In-Time scheduling software, Lexipol Policy Development software, and began using Nixle for advanced Social Media outreach.



Approximately three thousand hours of advanced officer training was completed to include advanced investigation, report writing, community policing, and officer safety training.



The Department implemented two new lieutenant positions and established special assignment corporal positions to assist with filed supervision and career development – succession planning. Additionally, within budget and through reassignment of personnel, a fourth detective position was created.



Completed projects included placing a 24/7 “911” phone at the front of the PD to assist those during non-business hours, a UAV program to aid in crime scene processing and searching for at risk missing persons, purchased and began implementation of a new report writing module. Additionally, the Department fully implemented our



Crime Scene Team (CST). CST personnel received advanced training, and will continue to receive additional advanced training, in processing of crime scenes.



The Department completed PD facility projects associated with partial remodels of the men’s & women’s locker room, EOC technology updates to assist with emergency operations, and lighting and electrical outlets in the PD secure parking lot and sally-port.



Successfully worked with Human Resources, conducted multiple recruitment and hiring processes to assure proper staffing.



Submitted and received grants such as an OPSG grant to combat border crimes issues, a GOHS grant to address traffic safety, an Arizona 100 Club grant for the purchase of several new Tasers, and a grant to purchase several new AED devices to aid in medical emergencies.



Participated in dozens of community events to strengthen and continue to develop our Community Policing efforts.

Costs by Category $9,000,000

$8,000,000 $7,000,000 $6,000,000

Capital

$ 488,100

$5,000,000

Other

$ 114,390

$4,000,000

Supplies

$ 470,700

$3,000,000

Services

$ 768,380

$2,000,000

Personnel

$6,278,440

$1,000,000 $0

FY 2016

$6,613,748

FY 2017

$7,432,400

Funding

$8,120,010

2018 Cost Changes

FY 2018

Department cost has changed by

+9%

General Fund GARS

QCCFD RSCFD

CIIF Other 87%

Increases

Animal control program Grant funded (includes +0.5 FTE): overtime: $105,000 -$61,300 Additional staff (+1.5 FTE): +$108,800 Net pay and benefit changes: +$334,100 Grant funded equipment: +$80,000

$ budgeted per resident: $269.80 Staffing: 2016 51.0 FTE 2017

53.0 FTE

2018

55.0 FTE

Decreases

Impound program and lot enhancements: +$40,000 Body camera video storage and support: +$34,000

Fuel: -$20,000

Goal #1

Continue Implementation of a comprehensive Community Policing program that enhances our community involvement and problem solving skills

Goal #2

Continue with development and implementation of a department training plan for each position within the police department to aid with career development and succession planning

Goal #3

Research and Identify Body Worn and Dashboard Camera systems to include local server or cloudbased storage of recordings

Goal #4

Continue Emergency Disaster response capabilities through training & exercises and implementation of Command Post

Goal #5

Maintain or decrease response times for top priority calls*

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Clearly define Community Policing/Neighborhood Oriented Policing (NOP) philosophy and practice for the SPD and make participation in community policing an expectation and part of each employee's performance plan

PARTIALLY COMPLETE

COMPLETE

N/A

Provide Community Policing/NOP and Customer Service training to all personnel

PARTIALLY COMPLETE

50%

100%

Continue development of communication methods to enhance our Community Policing/NOP efforts

PARTIALLY COMPLETE

50%

100%

Identify mandatory, essential and desirable training for each position within the department

25%

50%

100%

Have employees complete training identified as mandatory in accordance with requirements of the training plan

100%

Conduct evaluations on each course attended to determine value of training

100%

N/A

Identify possible Body Worn/Dashboard Camera systems and recording storage options.

N/A

100%

N/A

Purchase Body Worn/Dash mount Cameras for pilot program.

N/A

100%

N/A

Provide training for personnel on Body Worn/Dash mount Camera systems.

N/A

NEW

100%

Implement and evaluation pilot program for Body Worn/Dash mount Camera systems.

N/A

NEW

100%

Number of Emergency/Disaster training exercises

Number of incidents and/or activities the Command Post used for

Respond to priority one calls in less than five minutes

4:45

5:00

Respond to priority two calls in less than eight minutes

7:35

8:00

Host, attend or participate in a minimum of 25 community events throughout the year

*Total average time from receipt of police telephone calls to arrival on scene.

MUNICIPAL COURT DEPARTMENT INFORMATION Honorable Maria Avilez, Town Magistrate 520-344-7150

MISSION STATEMENT: The mission of the Municipal Court is to uphold the law and administer justice fairly and efficiently, treating all who come to the Court with dignity and respect.

MUNICIPAL COURT (6.0 FTE, $602,080) The Sahuarita Municipal Court is responsible for the processing and adjudication of all cases filed in the court, including the trial or other disposition of criminal misdemeanors, criminal traffic violations, civil traffic violations, and Town code and ordinance violations committed within the Town’s boundaries. The court is further responsible for collection and processing of fines, surcharges, restitution and other fees. The court issues and processes protective orders including injunctions against harassment, injunctions against workplace harassment, and orders of protection. The court also provides other services, including processing passports, issuing marriage licenses, performing marriages, and notary services. Services rendered by the court are governed by rules set by the Arizona Supreme Court and guided by statutes enacted by the Arizona Legislature.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------



Management continues to work with staff on new and continued court processes. A variety of projects have been delegated to court staff to continue to bring new case management system AJACS up to date. Sahuarita Municipal Court (SMC), in conjunction with the Sahuarita P.D. have begun and are in the process of perfecting ECitations. Judge Avilez continues involvement in other court activities. She serves as the Vice Pres. of the Arizona Magistrates Association. She was also appointed in 2006 by the Chief Justice of the AZ Supreme Court as a Commissioner on the Commission for Minorities and continues to serve as a sub-committee participant in the development of the Fifth Arizona Statewide Report Card, which assesses overrepresentation of minority youth in the juvenile system, and she participates in the Regional Municipalities Veterans Treatment Court. Judge Avilez continues to participate in local schools’ activities: guest speaker at the Sahuarita Middle school’s Career Day and reads for the Elementary School Love of Reading week.



The SMC (Sahuarita Municipal Court) continues to be used as a model court when policies and procedures are needed at other courts. Enhanced security measures by utilizing an outside vendor: Vet-Sec, which would eliminate the gap in coverage and allow the court to have security five days a week, 8 a.m. – 5 p.m. New collaboration with CENPATICO and Pima County Attorney’s Office Victim Witness Advocates by coordinating the physical presence of a representative to support and provide input on behalf of the victim(s) or defendant(s). CENPATICO assists with mental health and/or behavioral diversions and assessments. The court also continues to be involved in the RMVTC (Reginal Municipalities Veteran’s Treatment Court) as an option for Veterans. Provisions of fair and objective resolution of disputes and enforcement of laws in a manner appropriate to the needs of our community and society.

Costs by Category $700,000 $600,000

$500,000

Capital

$400,000

Other

$ 24,850

$300,000

Supplies

$ 21,340

$200,000

Services

$ 81,650

Personnel

$100,000

$474,240

FY 2016

FY 2017

$534,080

$593,360

Funding 0%

FY 2018

$602,080

2018 Cost Changes

0%0% 0%

Department cost has changed by

+1%

General Fund GARS QCCFD

RSCFD CIIF

Other 100%

$ budgeted per resident: $20.00 Staffing: 2016 8.0 FTE 2017

7.0 FTE

2018

6.0 FTE

Increases

Decreases

Net pay and benefit Reduced staffing changes: (-1.0 FTE): +$29,000 -$50,800 Outsourced security services: +$24,600

Goal #1

Provide better customer service to all litigants entering the courthouse.

Goal #2

Continue to execute cases in a timely manner as required to use resources effectively in delivering desired outcomes

Goal #3

Continue to provide quality safety measures for all litigants that enter the courthouse.

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

Payments made over the phone

402

500

Payments made on the court's main webpage of the Town's website

357

400

Marriage Licenses

Passports

582

500

600

Percentage of cases adjudicated (cases closed vs. cases opened) Criminal Misdemeanors/Civil & Criminal Traffic/Protective Orders

DUI Clearance Rate

Court Visitors scanned/walked through magnetometer

29,819

29,000

30,000

Number of items scanned through the X-Ray machine

8,466

8,000

9,000

197

150

Providing other community services such as: Marriage Licenses and passports

Number of items of contraband detected while entering the courthouse

* Please note that until glitches in the new case-management system are fixed and case reports are created, numbers for the DUI clearance rate will not be available.

STREETS DEPARTMENT INFORMATION M.J. Dillard, Public Works Director/Town Engineer mdillard@sahuaritaaz.gov 520-344-7100

MISSION STATEMENT: The Streets Department maintains public streets, rights-of-way and storm water drainage facilities. STREETS (10.7 FTE, $2,975,190) The Public Works – Streets Department is responsible for effective management of Town-owned infrastructure and public rights-ofway, specifically the maintenance of all public streets, roadways, landscape areas, and drainage ways to ensure the facilities fulfill the function for which they were designed. Well maintained public transportation and drainage facilities promote and enhance the quality of life throughout our community. The Streets Department also plays a key role with the engineering division to ensure that recurring operation & maintenance costs are considered and accounted for when planning for capital projects. As part of the ongoing effort toward continuous improvement in its annual maintenance costs, the Streets Department maintains an active Town wide volunteer program and Inmate Labor Program.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

The Department completed drainage improvements along Camino Antigua and La Canada Drive. The improvements reduce sheet flow and provide scour protection, decreasing the erosion that occurs along the road shoulders. Enhancements such as these reduce staff and contractor time necessary to clean up after heavy rain events.



The Department completed an overlay along Camino De Las Quintas. The overlay will extend the road life and offered an opportunity to correct several drainage issues that previously caused ponding after rain events. The new road surface improves pavement drainage, reduces the time and expense necessary to clean debris after heavy rain events, and minimizes the overall disruption of transportation services resulting from ponding and debris removal.



Volunteers assisted the Department with “Adopt-ARoadway,” “Adopt-A-Wash,” “Adopt-An-Underpass,” “Beat Back Buffelgrass” and other vital programs. Volunteers play a key role in enhancing the quality of life for the community, while helping the Department achieve its goal of organizational effectiveness.



As part of the ongoing goal to provide effective operation of Town-owned infrastructure, the Department has continued development of an asset management system for Town-owned infrastructure. These efforts will provide enhanced tracking of inspection, repair, and maintenance activities.



The Department continues to enhance civic engagement through online reporting of potential issues, questions, or concerns. Citizen feedback is essential to the department’s operations. The “Request Tracker” link on the Town’s website and the “YourGov” smart phone application allow citizens to report concerns directly to the Public Works Department.

Costs by Category $3,500,000 $3,000,000

$2,500,000

Capital

$ 139,000

$2,000,000

Other

$ 295,670

$1,500,000

Supplies

$ 204,930

$1,000,000

Services

$1,513,900

Personnel

$ 821,690

$500,000 $0

FY 2016

FY 2017

$1,701,795

$2,213,840

Funding

FY 2018

$2,975,190

2018 Cost Changes

1% 1%

Department cost has changed by

+34%

General Fund GARS

QCCFD RSCFD

CIIF HURF 94%

Increases Additional staff (+1.0 FTE):

As needed development and engineering $114,400 services: -$12,000

Pavement management: Fuel: +$382,900 Capital projects: +$120,000 Grant funded studies: +$100,000

$ budgeted per resident: $98.86 Staffing: 2015 12.7 FTE 2016

9.7 FTE

2017

10.7 FTE

Decreases

Grant funded youth art program: +$25,000 Traffic signal repairs: +$22,500 RS CFD district engineering costs: +$15,600

-$10,000

Goal #1

Establish, maintain and update preventative maintenance plans for Town infrastructure assets

Goal #2

Promote events and programs that foster community engagement and enhance the lives of residents

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

19,395

21,000

100%

Total number of volunteers (Adopt-a-Road, Adopt-a-Wash, Adopt-an-Underpass, Beat Back Buffelgrass)

531

632

600

Total volunteer hours (Adopt-a-Road, Adopt-a-Wash, Adopt-an-Underpass, Beat Back Buffelgrass)

581

887

700

Total number of trash bags collected (Adopt-a-Road, Adopt-a-Wash, Adopt-an-Underpass, Beat Back Buffelgrass)

487

575

550

220

Total Hours of Inmate Labor

Average number of days to repair a reported pothole

Percent of public roadways that are swept at least four times per year

Average number of days to repair a traffic signal outage Percentage of pavement in satisfactory or better condition per the Pavement Condition Index (PCI rating of 6 out of 10)

Total number of Buffelgrass bags collected

WASTEWATER DEPARTMENT INFORMATION M.J. Dillard, Public Works Director/Town Engineer mdillard@sahuaritaaz.gov 520-344-7100

MISSION STATEMENT: The Wastewater Department maintains and operates the wastewater plant and collection system to ensure system integrity.

WASTEWATER (6.3 FTE, $1,669,680) The Public Works – Wastewater Department is responsible for maintaining permit compliance and the effective operation and maintenance functions associated with the Town’s Water Treatment and Reclamation Facility, including over 13 acres of recharge basins for reclaimed water. The facility is permitted to treat up to 3.0 million gallons per day. The Sahuarita Water Reclamation Facility converts raw sewage into its final form of Class A+ quality reclaimed water through biological treatment, filtering, nitrogen removal, and disinfection. Reclaimed water is recharged into the aquifer through infiltration basins. Credits earned through recharge are stored for the future and are used to offset groundwater use at Lake Park. The Department is also responsible for the associated sewer collection system, which includes approximately 45 miles of sewer lines and over 1,100 manholes. Another key role of the Wastewater Department, that is accomplished through the engineering and administrative support within the Public Works Department, is to conduct planning and policy development to manage industrial waste permitting, respond to customer service requests related to the sewer system, pursue future service delivery opportunities, facilitate development opportunities, assure developer funded projects provide necessary infrastructure, and monitor construction of those improvements to ensure high quality and cost-effective Infrastructure.

-------------------------------------- DEPARTMENT HIGHLIGHTS -------------------------------------

In 2015, the Department treated over 280 million gallons of wastewater, with an average daily flow of 767,990 gallons.



Throughout 2015 the operations staff attended various trainings such NTT basics of industrial electricity, variable frequency drives basics, and troubleshooting electrical control circuits. Other safety trainings included forklift safety, blood-borne pathogen training, hazard communication and confined space to name a few.



The Department completed installation of a new step screen. The addition of the step screen repair or maintenance of step screen units without causing any interruption in treatment, eliminates the need for costly alternative hauling, and assures ongoing compliance with the Aquifer Protection Permit.



The Department coordinated efforts with the Green Valley Council in the collection of wastes, such as

electronics, household hazardous materials, and unused medications. Such events help protect the treatment system from unintended interruption in service due to improperly disposed waste materials. 

Throughout the year, Department staff participated in events aimed at teaching students about water resources, emphasizing our commitment to enhance civic engagement through public participation. Events included the third annual Sahuarita-Green Valley Water Festival funded by Freeport McMoRan and the Pima Association of Governments and the Sahuarita SciTech Festival, which introduces middle school students to the role of a wastewater treatment operator and providing them a first-hand look at analyzing water quality while drawing attention to the Department’s role in maintaining and operating the wastewater system to ensure system integrity. Both events were part of the Science, Technology, Engineering, and Mathematics (STEM) education units.

Costs by Category $1,800,000 $1,600,000 $1,400,000 $1,200,000

Capital

$ 50,000

$1,000,000

Other

$354,080

$800,000

Supplies

$115,960

$600,000

Services

$577,030

$400,000

Personnel

$572,610

$200,000 $0

FY 2016

$1,514,085

FY 2017

$1,574,230

FY 2018

$1,669,680

Funding 0%

2018 Cost Changes

0% 0%0%

Department cost has changed by

+6%

General Fund GARS

QCCFD RSCFD

CIIF Wastewater 100%

Increases

Decreases

Sewer line rehab project: +$50,000

No significant decreases

Recycle/Greycycle events: +$15,300 Dryhaul and disposal: +$13,000 Sewer maintenance: +$10,700

$ budgeted per customer: $288.27 Staffing: 2016 6.8 FTE 2017

6.3 FTE

2018

6.3 FTE

Indirect cost allocation: +$16,600

Goal #1

Maintain and operate the wastewater plant and collection system to ensure system integrity.

Percentage of reporting requirements met for the ADWR and ADEQ

ACTUAL FY 2016

ESTIMATED FY 2017

TARGET FY 2018

100%

NON-DEPARTMENTAL (0.0 FTE, $428,230) The Non-Departmental section of the budget accounts for operating costs and items not specifically identifiable to any other Town Department. These costs provide for animal control services, contracts for some social services, and costs associated with the Townâ&#x20AC;&#x2122;s general motor pool.

Costs by Category $600,000

$500,000

Capital

$270,000

Other

$ 97,480

Supplies

$ 2,500

$200,000

Services

$ 58,250

$100,000

Personnel

$400,000 $300,000

FY 2016

FY 2017

$550,666

$366,450

FY 2018

$428,230

Funding General Fund 36%

GARS

CIIF Other 1% 0%

$ budgeted per resident: $14.23 Staffing: 2016 0.0 FTE 2017

0.0 FTE

2018

0.0 FTE

Department cost has changed by

+17%

QCCFD RSCFD

63%

2018 Cost Changes Increases

Decreases

Expanded leased vehicle Move animal control replacement program: costs to Police Dept: +$160,000 -$95,000

Summary of Operating Expenditures by Department and Fund

DEPT

MAYOR & COUNCIL

TOWN MANAGER

LAW

TOWN CLERK

FINANCE

HUMAN RESOURCES

PLANNING & BUILDING

2016 Actual Amount

Fund

2017 Budget Adopted Amended

2018 Budget Amount

Estimated Actual

General Fund GARS QCCFD RSCFD CIIF Other

114,661 -

113,860 $ -

125,420 -

137,550 -

Department Total

114,661

113,860 $

125,420

137,550

General Fund GARS QCCFD RSCFD CIIF Other

718,438 77,425 -

753,180 $ 21,000 -

750,700 18,240 -

786,280 10,500 -

Department Total

795,863

774,180 $

768,940

796,780

General Fund GARS QCCFD RSCFD CIIF Other

570,336 -

643,730 $ -

639,180 -

698,420 -

Department Total

570,336

643,730 $

639,180

698,420

General Fund GARS QCCFD RSCFD CIIF Other

450,076 -

579,470 $ -

508,510 -

578,880 -

Department Total

450,076

579,470 $

508,510

578,880

General Fund GARS QCCFD RSCFD CIIF Wastewater

$ 1,172,565 298 298 164,908 271,174

$ 1,395,530 $ 1,395,530 $ 1,362,790 600 760 760 600 200,000 200,000 190,000 405,990 405,990 391,500

1,423,180 800 800 190,000 505,430

Department Total

$ 1,609,243

$ 2,002,280 $ 2,002,280 $ 1,945,490

2,120,210

General Fund GARS QCCFD RSCFD CIIF Other

242,998 -

268,680 $ 18,000 -

248,470 -

279,940 -

Department Total

242,998

286,680 $

248,470

279,940

General Fund GARS QCCFD RSCFD CIIF Other

$ 1,166,020 -

$ 1,239,460 $ 1,239,460 $ 1,239,530 -

1,312,040 45,000 -

Department Total

$ 1,166,020

$ 1,239,460 $ 1,239,460 $ 1,239,530

1,357,040

Summary of Operating Expenditures by Department and Fund

DEPT

PARKS & RECREATION

PUBLIC WORKS

POLICE

MUNICIPAL COURT

STREETS

Fund

2018 Budget Amount

Estimated Actual

$ 1,479,934 12,500 29,727 39,900 -

$ 1,732,900 $ 1,732,900 $ 1,661,170 15,000 15,000 10,000 12,770 12,770 20,800 108,000 108,000 87,920 -

1,897,330 15,000 27,330 -

Department Total

$ 1,562,061

$ 1,868,670 $ 1,868,670 $ 1,779,890

1,939,660

General Fund GARS QCCFD RSCFD CIIF Other

739,579 55,622 -

938,520 118,250 -

1,008,570 -

Department Total

795,201

$ 1,085,650 $ 1,085,650 $ 1,056,770

1,008,570

General Fund GARS QCCFD RSCFD CIIF Other

$ 5,703,369 538,600 371,779 -

$ 6,299,670 $ 6,299,670 $ 6,110,720 802,730 802,730 475,590 330,000 330,000 330,000 -

7,026,530 760,380 333,100 -

Department Total

$ 6,613,748

$ 7,432,400 $ 7,432,400 $ 6,916,310

8,120,010

General Fund GARS QCCFD RSCFD CIIF Other

534,080 -

593,360 $ -

556,030 -

602,080 -

Department Total

534,080

593,360 $

556,030

602,080

General Fund GARS QCCFD RSCFD CIIF HURF

8,028 10,020 17,445 1,666,302

$ $ 20,390 20,390 14,900 9,200 19,000 19,000 19,000 2,174,450 2,174,450 2,076,550

16,510 15,600 139,000 2,804,080

$ 1,701,795

$ 2,213,840 $ 2,213,840 $ 2,119,650

2,975,190

$ $ 1,574,230 1,574,230 1,528,580

1,669,680

$ 1,514,085

$ 1,574,230 $ 1,574,230 $ 1,528,580

1,669,680

General Fund GARS QCCFD RSCFD CIIF Other

245,007 305,659 -

251,350 $ 4,700 400 110,000 -

233,700 1,500 700 300,000 -

154,420 2,770 1,040 270,000 -

Department Total

550,666

366,450 $

535,900

428,230

General Fund GARS QCCFD RSCFD CIIF Wastewater Department Total

NON DEPARTMENT

2017 Budget Adopted Amended

General Fund GARS QCCFD RSCFD CIIF Other

Department Total

WASTEWATER UTILITY

2016 Actual Amount

1,514,085

965,270 $ 120,380 -

DEPARTMENT HISTORY OF OPERATING EXPEDITURES

Summary of Operating Expenditures by Department and Category

Categories

DEPT

MAYOR & COUNCIL

Personnel Services Supplies Other Capital Department Total

TOWN MANAGER

Personnel Services Supplies Other Capital Department Total

LAW

Personnel Services Supplies Other Capital Department Total

TOWN CLERK

Personnel Services Supplies Other Capital Department Total

FINANCE

Personnel Services Supplies Other Capital Department Total

HUMAN RESOURCES

Personnel Services Supplies Other Capital Department Total

PLANNING & BUILDING

Personnel Services Supplies Other Capital Department Total

2017

2016 Actual Amount

Budget Adopted Amended

2018 Budget Amount

Estimated Actual

59,695 108 11,252 43,606 -

59,210 $ 200 5,300 49,150 -

60,050 200 5,300 59,870 -

59,200 10,200 5,300 62,850 -

114,661

113,860 $

125,420

137,550

651,444 95,233 22,410 26,776 -

677,360 $ 44,610 16,210 36,000 -

677,360 $ 55,060 14,710 27,050 -

659,610 52,870 17,630 38,830 -

713,440 40,160 15,030 28,150 -

795,863

774,180 $

768,940

796,780

459,423 87,582 12,047 11,284 -

581,180 $ 31,500 15,100 15,950 -

585,310 23,600 14,950 15,320 -

622,120 43,250 16,700 16,350 -

570,336

643,730 $

639,180

698,420

304,614 116,022 16,948 12,492 -

359,120 $ 177,830 21,920 20,600 -

341,810 139,930 12,990 13,780 -

370,540 161,810 17,350 29,180 -

450,076

579,470 $

508,510

578,880

727,113 387,336 171,645 281,085 42,064

847,940 $ 441,350 73,600 439,390 200,000

847,940 $ 441,350 74,500 438,490 200,000

829,630 399,700 73,260 452,900 190,000

865,390 493,480 68,680 502,660 190,000

$ 1,609,243

$ 2,002,280 $ 2,002,280 $ 1,945,490

2,120,210

220,545 11,971 2,882 7,600 -

232,720 $ 15,670 7,010 13,280 18,000

217,660 15,120 7,010 8,680 -

232,240 13,370 17,950 16,380 -

242,998

286,680 $

248,470

279,940

$ 1,093,954 42,885 11,631 17,550 -

$ 1,158,740 $ 1,158,740 $ 1,155,310 50,490 38,870 45,700 13,760 25,380 22,310 16,470 16,470 16,210 -

1,196,120 83,060 15,380 17,480 45,000

$ 1,166,020

$ 1,239,460 $ 1,239,460 $ 1,239,530

1,357,040

Summary of Operating Expenditures by Department and Category

DEPT

PARKS & RECREATION

Categories Personnel Services Supplies Other Capital Department Total

PUBLIC WORKS

Personnel Services Supplies Other Capital Department Total

POLICE

Personnel Services Supplies Other Capital Department Total

MUNICIPAL COURT

Personnel Services Supplies Other Capital Department Total

STREETS

Personnel Services Supplies Other Capital Department Total

WASTEWATER UTILITY

Personnel Services Supplies Other Capital Department Total

NON DEPARTMENT

2016 Actual Amount

Personnel Services Supplies Other Capital Department Total

848,357 451,482 116,641 105,681 39,900

2017 Budget Adopted Amended 953,370 $ 519,580 143,770 143,950 108,000

Estimated Actual 925,270 510,480 125,650 125,490 93,000

1,028,750 563,030 195,590 152,290 -

$ 1,562,061

$ 1,868,670 $ 1,868,670 $ 1,779,890

1,939,660

401,068 362,208 20,983 10,942 -

427,860 456,850 40,060 13,750 118,250

416,700 540,400 37,900 13,570 -

795,201

$ 1,085,650 $ 1,085,650 $ 1,056,770

1,008,570

$ 5,114,770 572,950 299,641 107,787 518,600

$ 5,861,760 $ 5,861,760 $ 5,508,750 590,540 574,440 539,300 411,900 407,000 278,030 113,200 113,200 114,230 455,000 476,000 476,000

6,278,440 768,380 470,700 114,390 488,100

$ 6,613,748

$ 7,432,400 $ 7,432,400 $ 6,916,310

8,120,010

482,364 17,484 15,873 18,359 -

495,220 $ 52,050 21,340 24,750 -

468,350 53,130 15,580 18,970 -

474,240 81,650 21,340 24,850 -

534,080

593,360 $

556,030

602,080

634,428 661,271 193,935 195,769 16,392

712,230 $ 988,850 213,690 280,070 19,000

712,230 $ 991,350 200,190 280,070 30,000

647,510 980,100 197,970 264,070 30,000

821,690 1,513,900 204,930 295,670 139,000

$ 1,701,795

$ 2,213,840 $ 2,213,840 $ 2,119,650

2,975,190

548,890 541,550 119,210 311,480 7,450

572,610 577,030 115,960 354,080 50,000

$ 1,514,085

$ 1,574,230 $ 1,574,230 $ 1,528,580

1,669,680

(6,900) 146,565 1,808 93,734 315,459

- $ 154,950 3,200 98,300 110,000

151,850 2,000 82,050 300,000

58,250 2,500 97,480 270,000

550,666

366,450 $

535,900

428,230

487,566 424,019 101,814 500,686 -

2018 Budget Amount

418,940 $ 486,970 44,730 14,630 120,380

579,130 $ 556,410 115,960 322,730 -

953,370 $ 513,000 145,005 144,215 113,080

418,940 $ 485,550 46,150 14,630 120,380

579,130 $ 553,160 119,210 315,280 7,450

STAFFING LEVELS Full-Time Equivalent (FTE) FY 2016 Adopted Amended DEPARTMENT Mayor and Council Town Manager Law Town Clerk Finance Human Resources Planning and Building Parks and Recreation Public Works Police Municipal Court Streets Wastewater TOTALS

FTE 6.0 4.0 5.0 10.0 2.0 12.0 15.1 4.5 51.0 8.0 12.7 6.8 137.1

FY 2017 Change Adopted FTE 1.0 1.0 0.2 2.0 (1.0) (3.0) (0.5) (0.3)

FTE

FY 2018 Change Adopted FTE

6.0 5.0 5.0 11.0 2.0 12.0 15.3 4.5 53.0 7.0 9.7 6.3 136.7

1.0 2.0 (1.0) 1.0 3.0

FTE 6.0 5.0 5.0 11.0 2.0 12.0 16.3 4.5 55.0 6.0 10.7 6.3 139.7

Number of Personnel

DEPARTMENT Mayor and Council Town Manager Law Town Clerk Finance Human Resources Planning and Building Parks and Recreation Public Works* Police Municipal Court Streets Wastewater TOTALS *

FY 2016 Adopted Amended

FY 2017 Change Adopted

FY 2018 Change Adopted

HEAD COUNT

7 6 4 5 10 2 12 20 23 51 8 * * 148

0 0 1 0 1 0 0 0 -3 2 -1 * * 0

7 6 5 5 11 2 12 20 20 53 7 * * 148

0 0 0 0 0 0 0 6 1 2 -1 * * 8

7 6 5 5 11 2 12 26 21 55 6 * * 156

For head count, Streets and Wastewater employees were included in Public Works.

Full-time Equivalent Employees by Function Last 10 Years Full-time Equivalent Employees 2012 2013 2014 2015 2016

2009

2010

2011

5.0 2.0 3.0 -

5.0 3.0 4.0 -

4.0 3.0 4.0 -

3.3 3.0

3.3 2.0

5.0 1.0

2.0 2.0

2017

2018

4.0 2.0

2.5 1.5

3.0 1.0

3.0 2.0

Function/Department/Division General Government Mayor & Council (7 seats) Town Manager Administration Economic Dev./[Communications] Law Civil Prosecution Town Clerk Town Clerk Communications Finance Finance Technology Human Resources Planning & Building-Planning & Zoning Public Works-Facilities Municipal Court General Government Total

3.0 -

3.5 -

3.4 -

3.6 -

4.0 1.0

5.0 3.0 2.0 5.0 1.0 9.0 38.0

5.0 3.0 2.0 4.6 1.0 8.0 38.6

5.0 3.0 2.0 4.6 1.0 8.0 38.1

5.0 3.0 2.0 4.6 1.0 8.0 37.3

5.0 3.0 2.0 5.2 1.0 8.0 37.9

5.0 3.0 2.0 5.4 1.0 8.0 37.3

5.0 3.0 2.0 5.0 1.0 8.0 39.0

6.0 4.0 2.0 5.0 1.0 8.0 41.0

7.0 4.0 2.0 5.0 1.0 7.0 42.0

7.0 4.0 2.0 5.0 1.0 6.0 41.0

Public Safety Planning & Building-Building Safety Public Works-Engineering Police Dept Public Safety Total

12.0 3.9 51.0 66.9

10.8 3.9 55.2 69.9

7.0 3.8 52.4 63.2

7.0 3.2 50.9 61.1

6.0 3.5 51.0 60.5

6.0 3.5 50.0 59.5

7.0 3.5 51.0 61.5

7.0 3.5 53.0 63.5

7.0 3.5 55.0 65.5

Culture & Recreation Parks & Recreation Administration & Special Events Maintenance Recreation Culture & Recreation Total

5.0 5.0 7.8 17.8

2.0 5.0 8.1 15.1

3.0 5.0 6.7 14.7

3.5 5.0 6.6 15.1

3.7 5.0 6.6 15.3

3.7 5.0 7.6 16.3

Highways & Streets Streets Highways & Streets Total

13.6 13.6

14.5 14.5

15.1 15.1

13.5 13.5

14.0 14.0

12.7 12.7

9.7 9.7

10.7 10.7

9.5 145.8

8.2 146.3

8.2 139.6

8.0 135.0

7.3 134.7

7.3 133.1

6.8 134.7

6.8 137.1

6.3 136.7

6.3 139.7

Sewer Wastewater Utility Total

FY FTEs Change

2009 145.8 2.7

2010 146.3 0.5

Population 22,650 FTE / 1,000 6.44

25,259 5.79

2011 139.6 (6.7) 25,722 5.43

2012 135.0 (4.6) 26,244 5.14

2013 134.7 (0.3) 26,772 5.03

2014 133.1 (1.6) 27,476 4.84

2015 134.7 1.6

2016 137.1 2.4

28,051 4.80

28,425 4.82

2017 136.7 (0.3) 29,000 4.71

2018 139.7 3.0 29,725 4.70

160

7.00

140

6.00

# of FTEs

120

5.00

100 4.00

80 3.00

60 2.00

1.00

20 0

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

FTEs per 1,000 Population

Full-Time Equivalent Employees

FIVE-YEAR PLAN In order to develop a budget and to ensure that the Town continues to remain on excellent financial footing, a five year plan is evaluated and updated each year. As with any planning tool, this document uses estimates and expectations to project future results. In order to achieve accurate results, the plan must accurately identify the elements which drive results. While it may be simplistic to identify revenues as the driving force behind our five year plan, it is an essential first step. Without changes to the tax rate or structure, revenues are largely outside the control of the Town. Conversely, determining what services the Town will provide—and thereby establishing budget levels—are under the control of the Town Council. These budgeted expenditure levels are typically established only after revenue forecasts are determined, to see what can be afforded. The following assumptions were used in developing the five year financial plan:          

The base year for forecasts is the budget for fiscal year 2018 Economic growth will occur at a slow-moderate pace Based upon planning documents, there will be some commercial development Unless noted elsewhere, there will be no changes to operational service levels Personnel costs increase over time more than other costs due to merit increases and rising costs for health insurance and retirement contributions No future changes to tax rates or structure No future changes to fees or fee structures unless noted No future changes in policies and procedures No future changes in legislation that would impact Town finances Inflationary factors were included in projections

Past Growth and Future Projections 35,000

300

30,000

250

25,000 20,000 150 15,000 100 10,000 50

5,000 0

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

New Homes

247

267

169

206

277

260

266

218

223

227

230

Population

26,244

26,772

27,476

28,051

28,425

29,000

29,725

30,468

31,077

31,698

32,332

% Change

2.0%

2.6%

2.0%

1.3%

2.0%

2.5%

2.0%

New Homes

Population

200

The approach used in developing the five year financial plan is consistent with the methods used to develop the budget. In order to produce forecasts that are reasonably conservative, numerous scenarios are considered and evaluated, including best and worst cases. The extreme cases are interesting to consider but would likely lead to irrational decisions. We ultimately reach and agree on forecasts that are somewhere between the extremes but, in our best judgment, have more upside than downside to them. All financial forecasts produced by the Town implement the same philosophy:     

We exist for the betterment of our residents. Therefore, we will maintain foundational service levels in core functions. We will live within our means. We will pay our debt and meet debt obligations. We will use a performance measurement program to measure and improve our effectiveness and efficiency. We will maintain healthy reserves in the General Fund.

Numerous resources are used to develop the forecasts: External Resources  League of Arizona Cities and Towns  Joint Legislative Budget Committee  Arizona Department of Revenue  Arizona Department of Transportation  Office of the Arizona State Treasurer  University of Arizona Eller College of Management  Arizona State University W.P. Carey School of Business  Government Finance Officers Association  Governmental Accounting Standards Board  Local developers’ growth projections Internal Resources  Finance and Investment Advisory Committee  Town Council/departments/staff  Existing plans and policies Tools and Techniques  Regression analysis  Ratio analysis  Trend analysis  FISCALS application

The focus of the Town’s appropriated funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the Town’s financial requirements. In particular, available fund balances serve as a useful measure of a government’s net resources available for spending at the end of a particular fiscal year. The following summarizes Town activity over the next five years, by charting ending fund balances for all funds in the aggregate. The black area represents balances that are contractually restricted for specific purposes. The Town has established policies to set aside fund balances for stabilization reserves. These are shown in dark gray. The light gray areas represent balances over-and-above the restricted and commitment levels and are generally available for Council purposes. The chart also shows how much greater fund balances would have been had there been no deficits in the Wastewater Fund. This area is boxed in red dashes.

ENDING FUND BALANCES ALL FUNDS Restricted

Reserves

Available

WW Deficits

$30,000,000

$25,000,000

$7,797,440 $8,765,660 $8,419,870

$20,000,000

$15,000,000

$9,008,510 $8,853,850

$8,921,580

$13,340,100 $8,089,860

$9,275,250

$7,623,680

$6,696,170

$6,530,150

$4,752,160

$4,819,510

$5,302,720

$5,544,930

$5,447,490

$5,689,630

$4,126,140

$3,493,250

$3,079,250

$3,114,030

$3,182,370

$3,249,980

2017

2018

2019

2020

2021

2022

$10,000,000

$5,000,000

GENERAL FUND SUMMARY

     

Revenues will grow 21% between 2018 and 2022. See the Major Revenues section for more information. Expenditures will increase 13% between 2018 and 2022. Expenditures only include costs for items built into the 2018 budget; factored in future years for inflation, known and committed items, and cyclical costs (e.g., elections). The five-year plan assumes that certain economic metrics will be obtained pursuant to an economic development agreement, resulting in a $400 thousand payout in 2020. Pursuant to Town policy, revenues will exceed expenditures each year. The fund balance reductions in 2018 and 2020 relate to interfund transfers. Transfers to the CIIF will be used to assist with the completion of high-priority capital items, including $1.53 million for the SAMTEC project and $250 thousand annually for pavement management on arterial and collector streets. This project will generate future lease revenues that will result in pay back to the General Fund. Transfers to the Wastewater Fund, totaling $1.28 million, will be used to construct additional retention basins as part of the Wastewater Plant Expansion V project. This project will provide more effluent recharge, which could be used to pay back the General Fund. Nonspendable fund balances, which relate to the Wastewater Fund’s operating deficit, are expected to increase $967 thousand between 2018 and 2022. Pursuant to Town policy, reserve commitments will be fully funded. Nearly $1.1 million (annual average) of the reserves relate to other funds that are unable to establish sufficient reserves on their own. The five-year plan assumes that the Town Council will continue to assign $100 thousand annually to the Town Manager to contend with budget contingencies and $500,000 annually for future asset maintenance.

GENERAL FUND Millions

 

$25.0 $20.0 $15.0 $10.0 $5.0 $0.0 ($5.0)

2017

2018

2019

2020

2021

2022

Ending Balances $19,109,040

$16,533,260

$16,651,400

$16,610,920

$17,779,910

$18,893,150

Annual Change

$(2,575,780)

$118,140

$(40,480)

$1,168,990

$1,113,240

$418,170

GENERAL FUND SOURCES AND USES OF FUNDS 2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

SOURCES REVENUES: Taxes Sales taxes

Franchise taxes GPLET Licenses and Permits

5,067,810 304,260 1,418,500

5,338,030 312,270 1,339,950

5,856,340 320,470 1,219,020

6,284,010 327,190 1,580 1,232,580

6,522,120 334,040 1,620 1,243,420

6,762,520 341,030 1,660 1,251,550

Intergovernmental State shared sales taxes State shared income taxes State shared vehicle license taxes

2,630,970 3,470,980 1,214,350

2,696,620 3,560,890 1,320,840

2,821,480 3,664,790 1,410,820

2,976,670 3,835,990 1,511,620

3,119,890 3,996,670 1,612,940

3,255,080 4,186,980 1,710,020

689,540 32,610 116,600 3,120 186,000 202,640

754,280 80,920 120,930 2,830 190,750 239,780

724,260 74,800 125,370 2,500 195,620 316,270

719,190 76,680 129,000 2,500 199,590 387,180

689,230 77,540 132,710 2,500 203,640 424,290

713,480 78,250 136,500 2,500 207,780 459,380

19,800 25,000 20,730 15,402,910 7.3%

21,600 25,000 19,750 16,024,440 4.0%

110,700 45,000 15,000 16,902,440 5.5%

199,800 45,000 15,000 17,943,580 6.2%

199,800 45,000 15,000 18,620,410 3.8%

199,800 45,000 15,000 19,366,530 4.0%

(520,000) (90,000) (610,000)

(1,505,000) (1,190,000) (2,695,000)

(250,000) (250,000)

Charges for Services Indirect cost recovery Development fees Recreation fees Other Fines and fees Investment Earnings Miscellaneous Leases Insurance recoveries Other Subtotal: Revenues OTHER SOURCES: Transfers Out to CIIF Transfers Out to Wastewater Subtotal: Other Sources BEGINNING FUND BALANCES: Nonspendable Committed Assigned Unassigned Subtotal: Beginning Fund Balances

TOTAL SOURCES

3,395,260 4,502,470 5,124,900 5,558,880 5,626,610 5,713,540 4,752,160 4,819,510 5,302,720 5,544,930 5,447,490 5,689,630 500,000 500,000 500,000 500,000 500,000 500,000 10,043,450 9,287,060 5,605,640 5,047,590 5,036,820 5,876,740 18,690,870 19,109,040 16,533,260 16,651,400 16,610,920 17,779,910 $ 33,483,780 $ 32,438,480 $ 33,185,700 $ 34,344,980 $ 34,981,330 $ 36,896,440

USES CURRENT EXPENDITURES: Departmental Expenditures Subtotal: Current Expenditures

7.5% 10.6% 3.1% 5.2% 1.0% 2.8% $ 14,374,740 $ 15,905,220 $ 16,401,320 $ 17,260,570 $ 17,436,740 $ 17,926,640 14,374,740 15,905,220 16,534,300 17,734,060 17,201,420 18,003,290

ENDING FUND BALANCES:

TOTAL USES

4,502,470 5,124,900 5,558,880 5,626,610 5,713,540 5,470,690 4,752,160 4,819,510 5,302,720 5,544,930 5,447,490 5,689,630 100,000 100,000 100,000 100,000 100,000 100,000 500,000 500,000 500,000 500,000 500,000 500,000 9,254,410 5,988,850 5,189,800 4,839,380 6,018,880 7,132,830 19,109,040 16,533,260 16,651,400 16,610,920 17,779,910 18,893,150 $ 33,483,780 $ 32,438,480 $ 33,185,700 $ 34,344,980 $ 34,981,330 $ 36,896,440

CHANGE IN FUND BALANCE

Nonspendable Committed for Reserves Assigned for Contingencies Assigned for Asset Maintenance Unassigned Subtotal: Ending Fund Balances

418,170

(2,575,780) $

118,140

(40,480) $

1,168,990

1,113,240

HIGHWAY USER REVENUE FUND SUMMARY 

State shared HURF revenues will grow 16% between 2018 and 2022. See the Major Revenues section for more information.



The Streets Department operating budget will grow 8% between 2018 and 2022. These expenditures will exceed the state shared HURF revenues each year, resulting in declining fund balances.



Local Transportation Assistance Funds (LTAF), accumulated in prior years, will be completely spent by 2017 yearend. This revenue is no longer available.



Transfers out to the CIIF are needed to reimburse the CIIF for capital project costs incurred on street projects and for vehicle purchases/leases.



Ending balances are not sufficient to cover the operating reserves required by policy. Deficiencies will average $556 thousand annually and be reserved by the General Fund.

HURF FUND $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 ($200,000) ($400,000) ($600,000)

2017

2018

2019

2020

2021

2022

Ending Balances

$791,080

$389,100

Annual Change

$119,650

$(401,980)

$(389,100)

HIGHWAY USER REVENUE FUND (HURF) SPECIAL REVENUE FUND SOURCES AND USES OF FUNDS 2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

SOURCES REVENUES: Intergovernmental

14.4%

State Shared HURF PAG

4.5%

-1.0%

4.4%

4.1%

3.6%

2,173,170 32,300

2,270,470 150,000

2,247,350 25,000

2,346,240 25,000

2,443,080 25,000

2,530,780 25,000

3,788,770 5,050 4,200 6,003,490

1,720,840 10,740 4,152,050

23,690 3,110 2,299,150

250 2,371,490

420 2,468,500

300 2,556,080

(3,806,580) (3,806,580)

(1,749,950) (1,749,950)

Capital grants State HURF Investment Earnings Miscellaneous Subtotal: Revenues OTHER SOURCES: Transfers Out to CIIF Subtotal: Other Sources

(63,380) (63,380)

(39,690) (39,690)

(59,550) (59,550)

(43,220) (43,220)

BEGINNING FUND BALANCES: Restricted for HURF Subtotal: Beginning Fund Balances

TOTAL SOURCES

671,430 671,430 $ 2,868,340

791,080 791,080 $ 3,193,180

389,100 389,100 $ 2,624,870

$ 2,331,800

$ 2,408,950

$ 2,512,860

USES EXPENDITURES: Streets Department LTAF Subtotal: Current Expenditures ENDING FUND BALANCES:

$ 2,076,850 $ 2,804,080 $ 2,624,870 $ 2,331,800 $ 2,408,950 $ 2,512,860 410 2,077,260 2,804,080 2,624,870 2,331,800 2,408,950 2,512,860 0.8% 35.0% -6.4% -11.2% 3.3% 4.3%

TOTAL USES

791,080 791,080 $ 2,868,340

389,100 389,100 $ 3,193,180

Change in Fund Balance

Restricted for HURF Subtotal: Ending Fund Balances

119,650

$ 2,624,870

(401,980) $

$ 2,331,800

(389,100) $

$ 2,408,950

$ 2,512,860

GRANTS AND RESTRICTED SOURCES FUND SUMMARY 

Most of the revenues are from grants and other contributions. These are recognized to the extent that there are underlying expenditures. This activity has no impact on fund balance.



The fund also receives revenues from RICO seizures and Court fines. These sources come without a spending obligation and may be accumulated over time. These accumulated balances are restricted for purposes related to the Police Department and Municipal Court.



Most of the expenditures in this fund are one-time in nature. Therefore, fund balance projections will continue to increase until uses can be identified and programmed into the five-year plan.

GARS FUND $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0 ($100,000) ($200,000) ($300,000)

2017

2018

2019

2020

2021

2022

Ending Balances

$477,010

$246,100

$221,200

$255,980

$324,320

$391,930

Annual Change

$(66,870)

$(230,910)

$(24,900)

$34,780

$68,340

$67,610

GRANTS AND RESTRICTED SOURCES SPECIAL REVENUE FUND SOURCES AND USES OF FUNDS

2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

SOURCES REVENUES: Intergovernmental

Charges for Services Fines & Forfeitures Investment Earnings Miscellaneous Subtotal: Revenues

365,460 15,000 16,070 3,690 36,740 436,960

416,540 15,000 87,870 3,060 32,500 554,970

504,080 39,800 543,880 980,840

430,340 46,670 477,010 $ 1,031,980

475,590 18,240 10,000 503,830

192,560 53,540 246,100 $ 1,031,980

380,940 15,000 91,000 1,800 23,000 511,740

382,420 15,000 91,000 1,780 23,000 513,200

383,960 15,000 91,000 2,280 23,000 515,240

$ 385,560 15,000 91,000 2,740 23,000 517,300

222,440 33,540 255,980 771,220

283,780 40,540 324,320 $ 841,620

431,900 15,000 446,900

$ 434,690 15,000 449,690 344,390 47,540 391,930 $ 841,620

BEGINNING FUND BALANCES: Restricted for Police Restricted for Municipal Court Subtotal: Beginning Fund Balances

TOTAL SOURCES

192,560 53,540 246,100 757,840

160,660 60,540 221,200 734,400

USES EXPENDITURES: Police

Town Manager Parks & Recreation Municipal Court Subtotal: Expenditures

760,380 10,500 15,000 785,880

521,640 15,000 536,640

429,420 15,000 34,000 478,420

ENDING FUND BALANCES:

TOTAL USES

430,340 46,670 477,010 980,840

CHANGE IN FUND BALANCE

(66,870) $

Restricted for Police Restricted for Municipal Court Subtotal: Ending Fund Balances

(230,910) $

160,660 60,540 221,200 757,840

222,440 33,540 255,980 734,400

283,780 40,540 324,320 771,220

(24,900) $

34,780

68,340

67,610

QUAIL CREEK COMMUNITY FACILITIES DISTRICT FUND SUMMARY 

The fund’s secondary property tax rate will be $3.30 per $100 of assessed valuation and remain unchanged over the five-year planning timeframe. $3.00 of the rate is used for debt service and $0.30 is used for operating expenditures. Growth in the tax base is associated with new development and changes in property valuations.



Miscellaneous income is derived from developer contributions, which are used towards debt service requirements. These will average $330 thousand annually between 2018 and 2022.



The fund consumes all of its resources each year, resulting in ending balances of $0.

QUAIL CREEK CFD FUND $1

($1)

2017

2018

2019

2020

2021

2022

Ending Balances

Annual Change

QUAIL CREEK COMMUNITY FACILITIES DISTRICT (QC CFD) SPECIAL REVENUE FUND SOURCES AND USES OF FUNDS

2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

SOURCES REVENUES: Taxes

Miscellaneous Subtotal: Revenues

454,340 540,520 994,860

508,470 195,220 703,690

562,850 443,610 1,006,460

620,030 393,360 1,013,390

680,140 338,300 1,018,440

743,300 279,890 1,023,190

OTHER SOURCES:

9,997,700 (9,879,600) 118,100

Refunding Debt Proceeds Payments to Refunded Debt Escrow Subtotal: Other Sources

BEGINNING FUND BALANCES: Restricted for QC CFD Subtotal: Beginning Fund Balances

TOTAL SOURCES

$ 1,112,960

703,690

$ 1,006,460

$ 1,013,390

$ 1,018,440

$ 1,023,190

USES CURRENT EXPENDITURES: General Government Streets Parks and Recreation Subtotal: Current Expenditures

2,100 14,900 20,800 37,800

3,570 16,510 27,330 47,410

3,750 17,340 31,390 52,480

3,940 18,210 35,660 57,810

4,140 19,120 40,160 63,420

4,350 20,080 44,880 69,310

DEBT SERVICE:

150,000 426,820 4,500 493,840 1,075,160 1,112,960

365,000 286,780 4,500 656,280 703,690

670,000 279,480 4,500 953,980 1,006,460

685,000 266,080 4,500 955,580 1,013,390

705,000 245,520 4,500 955,020 1,018,440

725,000 224,380 4,500 953,880 1,023,190

TOTAL USES

$ 1,112,960

703,690

$ 1,006,460

$ 1,013,390

$ 1,018,440

$ 1,023,190

CHANGE IN FUND BALANCE

Principal Interest Other Debt Issuance Costs Subtotal: Debt Service Subtotal: Expenditures ENDING FUND BALANCES: Restricted for QC CFD Subtotal: Ending Fund Balances

RANCHO SAHUARITA COMMUNITY FACILITIES DISTRICT FUND SUMMARY 

The fund’s secondary property tax rate will be $4.99 per $100 of assessed valuation and remain unchanged over the five-year planning timeframe. $4.69 of the rate is used for debt service and $0.30 is used for operating expenditures. Growth in the tax base is associated with new development and changes in property valuations.



Debt will be issued in 2018 that will be used to acquire $6.76 million in infrastructure.



Miscellaneous income represents developer contributions which will be used to pay the difference between the annual debt service requirement and a property tax levy for debt service @ $4.69 per $100 of net assessed property value.



The fund consumes all of its resources each year, resulting in ending balances of $0.

RANCHO SAHUARITA CFD FUND $0

($500)

($1,000)

($1,500)

($2,000)

($2,500)

2017

2018

2019

2020

2021

2022

Ending Balances

Annual Change

$(2,140)

RANCHO SAHUARITA COMMUNITY FACILITIES DISTRICT (RS CFD) SPECIAL REVENUE FUND SOURCES AND USES OF FUNDS 2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

$ 132,730 429,080 561,810

$ 303,760 264,010 567,770

$ 501,190 69,210 570,400

SOURCES REVENUES: Taxes Investment Earnings (Losses)

Miscellaneous Subtotal: Revenues

2,700 250 5,410 8,360

40,860 338,200 379,060

41,270 335,110 376,380

OTHER SOURCES:

Debt Proceeds Subtotal: Other Sources

7,320,000 7,320,000

BEGINNING FUND BALANCES: Restricted for RS CFD Subtotal: Beginning Fund Balances

TOTAL SOURCES

2,140 2,140 10,500

$ 7,699,060

$ 376,380

$ 561,810

$ 567,770

$ 570,400

1,300 9,200 10,500

USES CURRENT EXPENDITURES: General Government

Streets Subtotal: Current Expenditures

1,840 15,600 17,440

380 5,000 5,380

810 15,000 15,810

520 20,000 20,520

400 22,000 22,400

DEBT SERVICE:

Principal Interest Other Debt Issuance Costs Subtotal: Debt Service

362,950 560,000 922,950

366,000 5,000 371,000

175,000 366,000 5,000 546,000

185,000 357,250 5,000 547,250

195,000 348,000 5,000 548,000

10,500

6,758,670 6,758,670 7,699,060

376,380

561,810

567,770

570,400

$ 7,699,060

$ 376,380

$ 561,810

$ 567,770

$ 570,400

CAPITAL OUTLAY: Infrastructure Subtotal: Capital Outlay Subtotal: Expenditures ENDING FUND BALANCES:

TOTAL USES

10,500

CHANGE IN FUND BALANCE

(2,140) $

Restricted for RS CFD Subtotal: Ending Fund Balances

CAPITAL INFRASTRUCTURE IMPROVEMENT FUND SUMMARY 

Unrestricted revenues (taxes and investment income) will grow 31% between 2018 and 2022, averaging $2.77 million annually. See the Major Revenues section for more information on construction contracting taxes.



Transfers in from other funds represent reimbursements for capital costs incurred in the CIIF.



Debt service costs increase over time as the Town continues to replace its motor pool via capital lease financing and as $5.25 million in new debt is expected to be issued 2021 to finance the public plaza project.



Capital outlay costs include project costs, payroll costs, and indirect cost allocations. See the Capital Improvement Plan section for more information on project costs.



Ending balances will decline significantly in 2018 as a result of expenditures programmed in the Capital Improvement Plan. Thereafter, fund balances will remain relatively level. $3.3 million of the fund balances are not available for use in the CIIF as they relate to interfund loans which cover a portion of the deficits in the Wastewater Fund.



Ending fund balances will exceed the minimum fund balance requirement outlined in Town policy.

Millions

CIIF FUND $8.0 $6.0 $4.0 $2.0 $0.0 ($2.0) ($4.0)

2017

2018

2019

2020

2021

2022

Ending Balances

$6,780,660

$4,329,800

$4,201,340

$4,385,740

$4,765,950

$4,837,390

Annual Change

$310,620

$(2,450,860)

$(128,460)

$184,400

$380,210

$71,440

CAPITAL INFRASTRUCTURE IMPROVEMENT FUND (CIIF) CAPITAL PROJECTS FUND SOURCES AND USES OF FUNDS 2017 Estimated Amounts

2018 Forecasted Amounts

2019 Forecasted Amounts

2020 Forecasted Amounts

2021 Forecasted Amounts

2022 Forecasted Amounts

$ 1,838,740 1,200 272,680 92,210 165,000 2,369,830

$ 2,306,000 3,050,000 79,250 150,000 5,585,250

$ 2,524,280 60,370 2,584,650

$ 2,747,280 63,120 2,810,400

$ 2,900,950 27,190 2,928,140

$ 3,064,430 70,620 3,135,050

520,000 3,806,580 50,000 300,000 4,676,580

1,505,000 1,749,950 3,360 58,000 270,000 3,586,310

250,000 63,380 6,890 58,000 270,000 648,270

250,000 39,690 6,890 49,000 210,000 555,580

250,000 59,550 6,890 58,000 5,250,000 300,000 5,924,440

250,000 43,220 6,890 58,000 300,000 658,110

3,353,790 231,220 2,885,030 6,470,040 $ 13,516,450

22,000 3,304,840 231,220 3,222,600 6,780,660 $ 15,952,220

3,304,840 361,220 663,740 4,329,800 $ 7,562,720

3,304,840 2,980 893,520 4,201,340 $ 7,567,320

3,304,840 4,910 1,075,990 4,385,740 $ 13,238,320

3,304,840 4,910 1,456,200 4,765,950 $ 8,559,110

$ 1,187,500 485,360 5,000 1,677,860

$ 1,157,500 447,320 5,000 1,609,820

$ 1,588,750 432,860 5,000 2,026,610

$ 1,653,750 407,370 5,000 2,066,120

$ 1,695,450 372,650 5,000 250,000 2,323,100

$ 1,967,100 496,420 5,000 2,468,520

1,105,840 330,000 3,421,170 200,920 5,057,930 6,735,790

5,274,360 333,100 2,564,140 1,841,000 10,012,600 11,622,420

522,620 316,300 330,350 165,500 1,334,770 3,361,380

480,210 314,000 266,250 55,000 1,115,460 3,181,580

5,518,850 315,000 290,420 25,000 6,149,270 8,472,370

526,950 325,000 266,250 135,000 1,253,200 3,721,720

TOTAL USES

22,000 3,304,840 231,220 3,222,600 6,780,660 $ 13,516,450

3,304,840 361,220 663,740 4,329,800 $ 15,952,220

3,304,840 2,980 893,520 4,201,340 $ 7,562,720

3,304,840 4,910 1,075,990 4,385,740 $ 7,567,320

3,304,840 4,910 1,456,200 4,765,950 $ 13,238,320

3,304,840 4,910 1,527,640 4,837,390 $ 8,559,110

CHANGE IN FUND BALANCE

$ (2,450,860) $

SOURCES REVENUES: Taxes Licenses and Permits Intergovernmental Investment Earnings Miscellaneous Subtotal: Revenues OTHER SOURCES: Transfer In From General Fund Transfers In From HURF Transfer In From WW Proceeds on Sale of Assets Debt Proceeds Capital Leases Subtotal: Other Sources BEGINNING FUND BALANCES: Restricted: Grants Assigned to Interfund Advances Assigned for Debt Service Available for Capital Projects Subtotal: Beginning Fund Balances

TOTAL SOURCES USES DEBT SERVICE: Principal Interest Other Debt Issuance Costs Subtotal: Debt Service CAPITAL OUTLAY: General Government Public Safety Highways and Streets Culture and Recreation Subtotal: Capital Outlay Subtotal: Expenditures ENDING FUND BALANCES: Restricted for SAMTEC / 16S03 Assigned to Interfund Advances Assigned for Debt Service Available for Capital Projects Subtotal: Ending Fund Balances

310,620

(128,460) $

184,400

380,210

71,440

WASTEWATER ENTERPRISE FUND SUMMARY 

User charges are expected to increase by 21% between 2018 and 2022. 4% user fee increases are programmed for years 2018 through 2020. These increases coincide with expected County’s wastewater fee increases. See the Major Revenues section for more information.



Investment losses will occur each year due to the fund’s deficit cash position.



Connection fees are programmed to increase by 2.6% in 2018. This increase coincides with expected County’s wastewater fee increases. See the Major Revenues section for more information.



Departmental operating expenditures are expected to increase by 5% between 2018 and 2022. Due to the Utility’s collections efforts, the portion of costs related to bad debt expense is expected to decline in the future. This lowers the overall departmental increase.



Transfers in from the General Fund will be used to pay for the construction of additional retention basins as part of the Wastewater Plant Expansion V project. This project will provide more long-term storage credits (i.e., effluent recharge), which could be used to pay back the General Fund.



Transfers out to the CIIF are needed to reimburse the CIIF for vehicle purchases/leases made on behalf of the Wastewater Department.



Unassigned fund balances will be in deficit position each year, averaging $8.8 million annually. These deficits will be covered via cash advances from the General Fund and CIIF.



Ending balances will not be sufficient to cover the operating reserve required by Town Policy. The deficiency will average $536 thousand annually and be reserved by the General Fund.

Millions

WASTEWATER FUND $1.0 $0.0 ($1.0) ($2.0) ($3.0) ($4.0) ($5.0) ($6.0) ($7.0)

2017

Ending Balances $(4,939,390) Annual Change

$(1,089,860)

2018

2019

2020

2021

2022

$(5,561,820)

$(5,995,800)

$(6,063,530)

$(6,150,460)

$(5,907,610)

$(622,430)

$(433,980)

$(67,730)

$(86,930)

$242,850

WASTEWATER ENTERPRISE FUND SOURCES AND USES OF FUNDS 2017

2018

2019

2020

2021

2022

Estimated

Forecasted

Amounts

$ 3,031,660 172,330 3,203,990

$ 3,154,140 175,780 3,329,920

$ 3,345,910 209,200 3,555,110

$ 3,549,340 234,100 3,783,440

$ 3,692,730 254,950 3,947,680

$ 3,766,580 254,950 4,021,530

(25,640) 103,020 82,150 146,770 -

(69,610) 136,220 74,650 304,570 242,310

(68,620) 144,630 50,000 316,030 87,470

(74,060) 275,080 50,000 324,500 154,630

(75,360) 305,460 50,000 332,960 -

(72,760) 320,030 50,000 338,610 296,560

306,300 3,510,290

688,140 4,018,060

529,510 4,084,620

730,150 4,513,590

613,060 4,560,740

932,440 4,953,970

90,000 90,000

1,190,000 (3,360) 1,186,640

(6,890) (6,890)

2,108,050 750,000 (8,419,870) (5,561,820) (1,484,090) $

2,108,050 750,000 (8,853,850) (5,995,800) (1,489,100) $

2,108,050 750,000 (8,921,580) (6,063,530) (1,509,680) $

SOURCES OPERATING REVENUES: User Charges - Residential User Charges - Commercial Subtotal: Operating Revenues NON-OPERATING REVENUES: Investment Earnings (Losses) Long-term Storage Credits Miscellaeous Sewer Connection Fees - Residential Sewer Connection Fees - Commercial Subtotal: Non-Operating Revenues Subtotal: Revenues OTHER SOURCES: Transfers In from General Fund Transfers Out To CIIF Subtotal: Other Sources BEGINNING FUND BALANCES: Restricted for Debt Service Restricted for Rate Stabilization Fund Unassigned (Deficits) Subtotal: Beginning Fund Balances

TOTAL SOURCES

2,108,050 2,108,050 750,000 750,000 (6,707,580) (7,797,440) (3,849,530) (4,939,390) $ (249,240) $ 265,310 $

2,108,050 750,000 (9,008,510) (6,150,460) (1,203,380)

USES CURRENT EXPENDITURES: Wastewater Utility Department Subtotal: Current Expenditures

13.3% 10.7% -3.5% 3.0% 3.1% 2.9% $ 1,920,080 $ 2,125,110 $ 2,051,700 $ 2,113,830 $ 2,179,560 $ 2,242,370 1,920,080 2,125,110 2,051,700 2,113,830 2,179,560 2,242,370

DEBT SERVICE: Principal Interest Subtotal: Debt Service

1,598,990 832,080 2,431,070

1,648,620 782,470 2,431,090

1,652,250 726,270 2,378,520

1,713,820 664,700 2,378,520

1,777,690 600,830 2,378,520

1,843,930 534,580 2,378,510

339,000 339,000

1,270,930 1,270,930

81,490 81,490

82,080 82,080

82,700 82,700

83,350 83,350

4,690,150

5,827,130

4,511,710

4,574,430

4,640,780

4,704,230

CAPITAL OUTLAY: WW Capital Projects Subtotal: Capital Outlay Subtotal: Expenditures ENDING FUND BALANCES: Restricted for Debt Service

TOTAL USES

2,108,050 2,108,050 750,000 750,000 (7,797,440) (8,419,870) (4,939,390) (5,561,820) $ (249,240) $ 265,310 $

CHANGE IN FUND BALANCE

$ (1,089,860) $

Restricted for Rate Stabilization Fund Unassigned (Deficits) Subtotal: Ending Fund Balances

(622,430) $

2,108,050 750,000 (8,853,850) (5,995,800) (1,484,090) $

2,108,050 750,000 (8,921,580) (6,063,530) (1,489,100) $

2,108,050 750,000 (9,008,510) (6,150,460) (1,509,680) $

2,108,050 750,000 (8,765,660) (5,907,610) (1,203,380)

(433,980) $

(67,730) $

(86,930) $

242,850

CAPITAL IMPROVEMENT PLAN Providing the capital assets (infrastructure, facilities, and equipment) needed for public services is among the most important responsibilities of Town officials. These assets are the primary method for the Town to accomplish several goals. Construction of capital infrastructure is a method of carrying out partnership plans with private entities. These assets provide a means of supporting and encouraging development in accordance with public plans. Construction of capital facilities is a method of providing a work environment to public employees and a gathering place for general citizenry. And finally, purchase of capital equipment is a method of multiplying the output of public employees. The capital plan is the Town’s multi-year blueprint for creating and maintaining the crucial infrastructure that will support Sahuarita. Each year, in conjunction with the annual budgeting process, the departments of the Town Manager and Finance coordinate the process of revising and updating the plan. The values, priorities, goals, and objectives established by Sahuarita’s elected officials and citizens determine the broad parameters for incorporating new capital improvement projects into the plan. Other documents, such as the Town’s General Plan also provide valuable information and guidance in the preparation of the plan. CAPITAL IMPROVEMENT PLAN A capital improvement plan (CIP) is the document that local governments use as a multi-year map of planned and funded capital projects and other asset acquisitions. Items included in the CIP are assets that (individually) cost more than $5,000 and have a useful life of numerous years. The Town’s CIP includes the following characteristics: 

The CIP covers a five year period, the budget year and four planning years. The Town reviews and updates the CIP annually. The first year of the CIP is incorporated into the annual budget.



The CIP accounts for minor projects such as office remodeling and projected ongoing equipment replacement plans. Expenditures occur each year and are necessary to ensure the Town has adequate equipment to fulfill critical services.



The CIP allocates project costs by year according to when spending is anticipated to occur. Appropriations of funds, sufficient to cover expenditure levels, are made each year as part of the process of developing the annual budget.



The CIP estimates the impact of projects on the operating budget. Some projects add recurring expenditures and new positions. Others result in expenditure savings or possibly generate additional revenues.

A capital project falls into one of three categories: 1. New construction refers to the creation of new infrastructure which did not exist before. This is needed to provide appropriate service to a growing population. One example would be the construction of a new road. 2. Replace end-of-life assets refers to the natural life cycle of assets which are consumed and need to be replaced in order to provide the same service to our citizens. One example would be the replacement of a bridge when it has become unsafe. 3. Enhance existing assets refers to the improvement of current infrastructure in order to provide better or more efficient service to our citizens. One example would be the improvement of a 4-way stop sign to a lighted traffic signal in order move traffic more efficiently.

Financing Options The Town’s staff conducts a thorough review of all funding options in order to determine the most efficient and least costly method of paying for capital needs. There are generally three categories of funding available: The following category descriptions may be helpful in understanding the chart: 

Local funding refers to the money which has been saved from previous years combined with revenue received in the current year. Local funding is the most flexible resource available. It is also used to make debt payments and to provide a local matching source, required in many grant agreements.



Grants, contributions and restricted sources refer to funding which comes from partner-entities. Some partners, such as the Pima County Regional Transportation Authority, provide financing through grants to reimburse the Town for expenditures. Other partners may provide money, land, or rights to access land in order to accomplish a mutually beneficial goal, such as a water company joining a partnership to improve a bridge and improve the

water line attached to that bridge. 

Debt refers to funding which comes from a structured borrowing of money from the capital markets. Debt is often used when there are insufficient funds on hand to acquire a new asset. Smaller payments are then made over a long-term period of time. Those who benefit from the existence of the new asset are the ones who provide the revenues that are used to make the debt payments; a concept known as intergenerational equity.

A more detailed discussion of each category, including the amount of funding available from various sources follows.

LOCAL FUNDING Capital Fund (CIIF) The Capital Infrastructure Improvement Fund (CIIF) is the financing source that includes the Town’s 4.0% tax on new construction, investment earnings, and accumulated reserves (i.e., beginning fund balances). The Town evaluates the amount of money which has been received in the past as well as the expectation of future revenues to determine the amount of funding available from local sources. This process requires significant analysis and estimation of future capital purchases made from local source as well as estimation of internal wastewater deficits. The information is derived and analyzed concurrently between the plan of capital finance as well as the 5 year plan(s) for the various funds, and the projection of major revenues. Demands on this local source are significant.

Wastewater Fund This source includes system revenues of the wastewater utility, including sewer user and connection fees, accumulated reserves, and investment earnings. The Town evaluates the funding deficiency from the wastewater utility system in the current year as well as projecting the projected cash deficits or surpluses in future years.

GRANTS, CONTRIBUTIONS & RESTRICTED SOURCES Highway Fund (HURF) The State of Arizona assesses a tax on fuel sales. The Town receives an allotment of the tax collections to use on specific capital projects. These collections may be distributed by the Arizona Department of Transportation, but the monies are mostly authorized and distributed through an intermediary; the Pima Association of Governments. In order to obtain funding the Town must submit a proposal for a grant and have the grant proposal approved by either the ADOT or the PAG.

RTA Transportation Tax The Regional Transportation Authority (RTA) is a County-wide jurisdiction that assesses a 0.5% transaction privilege tax on all purchases within its boundaries. Pursuant to regionalized transportation planning, the Town receives an allotment of these tax collections to use on specific capital projects.

Federal and State Grants, Contributions and Restricted Sources Grants and contributions represent grants and awards from federal, state, and other sources. Most of these require the Town to incur project costs and subsequently submit financial reports for reimbursement. The Town must submit grant proposals which are reviewed and approved by the granting authority in order to access grant funds. Restricted sources represent revenues that have been collected pursuant to federal and state law, whose use is limited for specified purposes.

Partnerships The Town is actively seeking partners to increase the public infrastructure within the Town for the benefit of our citizens and our region. We obtain funding from partners who share an interest in increasing the public infrastructure within the Town boundaries.

DEBT Periodically the Town may obtain debt proceeds by entering into long-term debt arrangements with lending institutions, such as banks or the Water Infrastructure Finance Authority (WIFA); or the Town may access the capital markets directly by issuing bonded debt to investors. The debt proceeds are then used to construct or acquire capital assets. Annual debt service payments are made from local revenue sources. Legal Debt Limit The Town is subject to the following debt limitations: 1) Under Arizona law, the citizens of the Town can vote to issue general obligation bonds for an amount up to 20% of its secondary assessed property valuation for specific services, such as transportation, water, sewer, lighting, parks and recreational facilities. 2) Under Arizona law, the citizens of the Town can vote to issue general obligation bonds for an amount up to 6% of secondary assessed valuation for general municipal purposes.

The citizens of the Town have not voted to authorize any general obligation bonds that would apply against these debt limits. The total debt capacity in 2017 is projected to be approximately $55 million. The Quail Creek Community Facilities District and the Rancho Sahuarita Community Facilities District are legally separate entities and, therefore, their debt obligations do not count towards the Town’s debt limitation.

Unfunded “Wish List” Projects Many projects considered were deemed a high enough priority that they would have been included in the five-year CIP to some extent but for lack of sufficient resources were not. These projects are included on the following table which the Town considers as its “wish list” of unfunded projects. Project Sahuarita Pool & Recreational Complex Municipal Operations Center North Santa Cruz Park Expansion 2 Anamax Park Splash Pad Q.C. Veterans-Municipal Park Expansion 2B Anamax Park Expansion 2 Inclusive Park Playground & Walkways TOTAL

Project # Description Total Cost 06K01 Build 40,000 sq.ft recreation center with aquatic center $ 15,140,000 Acquire site and construct a facility for maintenance and 06FM6 6,000,000 other operations Add splash park, two multi-purpose fields and one little 08K03 league baseball field, lighting, picnic facilities, and a 3,540,000 basketball court. 17K05 Construct a splash pad recreational water feature. 771,000 Add lighted sports fields, parking, picnic facilities, hardscape 17K06 3,571,000 courts, and landscaping. Add baseball field, parking, lighting, remove septic system 17K08 871,000 and connect to County sewer system Construct an inclusive playground and improve sidewalks at 18K05 771,000 Sahuarita Lake Park $ 30,664,000

Summary The plan takes into consideration all known capital needs and ties potential revenue sources to those needs. As the Town continues to grow, new needs will undoubtedly surface, causing the plan to fluctuate and require more resources. For this reason, the Town always considers all requests, but only those projects of the highest priority that fit within the available dollars are included in the plan. All other projects may be reconsidered in future years if more funding becomes available. The CIP includes 28 projects totaling $20,421,310 for fiscal years 2018 through 2022. Of these, nine are considered major projects, those that cost more than $250,000, which total $15,797,910 during the five-year plan. There are 19 operating capital and minor projects that total $4,623,400. The 2018 budget incorporates the first year of the CIP.

Millions

Project Costs by Year $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

FUNDING SOURCE SUMMARY SOURCE Capital Fund (CIIF) General Fund Restricted Funds Grants- Federal Grants - Private Partners Highway Fund (HURF) Debt/Capital Leases Wastewater Fund

GRAND TOTAL

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 TOTAL $ 2,932,780 $ 643,300 $ 494,000 $ 487,700 $ 585,000 $ 5,142,780 2,605,000 250,000 250,000 250,000 250,000 3,605,000 155,000 95,000 34,000 284,000 3,050,000 3,050,000 150,000 150,000 1,720,840 23,690 1,744,530 270,000 270,000 210,000 5,300,000 300,000 6,350,000 50,000 50,000 50,000 50,000 50,000 250,000 $ 10,933,620 $ 1,331,990 $ 1,038,000 $ 6,087,700 $ 1,185,000 $ 20,576,310

DEPARTMENT EXPENDITURE SUMMARY DEPARTMENT Non-Departmental Finance-Technology Police Municipal Court Planning & Building Parks & Recreation Streets Wastewater Utility

GRAND TOTAL

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 TOTAL $ 4,745,000 $ 270,000 $ 210,000 $ 5,300,000 $ 300,000 $ 10,825,000 190,000 125,000 125,000 125,000 125,000 690,000 488,100 411,300 314,000 315,000 325,000 1,853,400 34,000 34,000 45,000 45,000 1,841,000 165,500 55,000 25,000 135,000 2,221,500 2,384,520 310,190 250,000 272,700 250,000 3,467,410 1,240,000 50,000 50,000 50,000 50,000 1,440,000 $ 10,933,620 $ 1,331,990 $ 1,038,000 $ 6,087,700 $ 1,185,000 $ 20,576,310 Projects by Function

Funding Sources $534,000 3%

$11,549,000, 56%

$8,747,780, 42%

$6,350,000 31% $3,467,410 17% $1,440,000, 7%

$4,944,530, 24%

Grants

Unrestricted local

Restricted local

$1,898,400, 9%

Debt/Capital Leases

Streets

Parks

$2,221,500, 11%

Public Safety

Sewer

General

PROJECTS EXPENDITURES BY DEPARTMENT DEPARTMENT PROJECT

YEAR 1 FY 2018

PROJ #

Non-Departmental Motor Pool Vehicle Replacement Program Advanced Manufacturing and Technology Center Town Center/Public Plaza Non-Departmental Total

xxND1 17ND1 18ND1

Finance-Technology Server & Computer Replacement Program Municipal WiFi Town Hall Conference Room Upgrades Technology Total

xxIT1 14IT1 16IT1

Police Police Patrol Vehicle Replacement Program Police Training Room Police Interview Room Police Detective Work Area Police Total

xxPD1 16PD6 18PD1 18PD2

Municipal Court Court Security Upgrade Court Total

14CT1

$ $

Planning & Building Development Services ERP Planning & Building Total

18PB1

$ $

Parks & Recreation Park Playground Canopy Replacement Program Park Maintenance Building Replacement Old Park Maintenance Building Demolition Portable Generator & Equipment SUSD K-8 Fields Partnership Concrete Path at Anamax Dog Park Mobile Event Stage Pump Track & Skate Spot Improvements Parks & Recreation Total

xxK01 14K04 17K03 17K04 18K01 18K02 18K03 18K04

Streets Arterial and Collector Roadway Enhancements Quail Crossing Blvd Extension-Phase I Interchange Improvements: Sahuarita Rd/I-19 Pima Mine Road Bike Lanes/Paved Shoulders Rancho Sahuarita Blvd Safety Improvements Intersection Safety Improvements Drainage Improvement Project Public Works / Streets Total

xxS01 05P01 05P03 16S03 16S06 18S01 18S04

xxWW1 04W02

Wastewater Utility Sewer Conveyance System Rehab Program Wastewater Plant Expansion Phase V Wastewater Utility Total GRAND TOTAL

YEAR2 FY 2019

YEAR 3 FY 2020

YEAR 4 FY 2021

YEAR 5 FY 2022

TOTAL YEARS 1-5

270,000 $ 270,000 $ 210,000 $ 300,000 $ 300,000 $ 1,350,000 4,365,000 4,365,000 110,000 5,000,000 5,110,000 $ 4,745,000 $ 270,000 $ 210,000 $ 5,300,000 $ 300,000 $ 10,825,000

$ $

125,000 $ 125,000 $ 125,000 $ 125,000 $ 125,000 $ 15,000 50,000 190,000 $ 125,000 $ 125,000 $ 125,000 $ 125,000 $

625,000 15,000 50,000 690,000

333,100 $ 316,300 $ 314,000 $ 315,000 $ 325,000 $ 1,603,400 155,000 155,000 60,000 60,000 35,000 35,000 488,100 $ 411,300 $ 314,000 $ 315,000 $ 325,000 $ 1,853,400 -

$ $

45,000 $ 45,000 $

$ $

$ 25,000 $ 591,000 55,500 1,250,000 85,000 $ 1,841,000 $ 165,500 $

34,000 $ 34,000 $ -

$ $

$ 55,000 55,000 $

$ $

34,000 34,000

$ $

45,000 45,000

25,000 $ $ 50,000 591,000 55,500 100,000 100,000 1,250,000 35,000 35,000 85,000 55,000 25,000 $ 135,000 $ 2,221,500

250,000 $ 250,000 $ 250,000 $ 250,000 $ 250,000 $ 1,250,000 1,720,840 23,690 1,744,530 22,700 22,700 39,000 39,000 274,680 274,680 50,000 36,500 86,500 50,000 50,000 $ 2,384,520 $ 310,190 $ 250,000 $ 272,700 $ 250,000 $ 3,467,410 50,000 $ 1,190,000 $ 1,240,000 $

50,000 $ 50,000 $

50,000 $ 250,000 1,190,000 50,000 $ 1,440,000

$ 10,933,620 $ 1,331,990 $ 1,038,000 $ 6,087,700 $ 1,185,000 $ 20,576,310

PROJECTS BY FUNDING SOURCE SOURCE PROJECT

PROJ#

Capital Fund (CIIF) Server & Computer Replacement Program Police Patrol Vehicle Replacement Program Park Playground Canopy Replacement Program Interchange Improvements: Sahuarita Rd/I-19 Municipal WiFi Park Maintenance Building Replacement Town Hall Conference Room Upgrades Pima Mine Road Bike Lanes/Paved Shoulders Rancho Sahuarita Blvd Safety Improvements Old Park Maintenance Building Demolition Portable Generator & Equipment Town Center/Public Plaza Development Services ERP SUSD K-8 Fields Partnership Concrete Path at Anamax Dog Park Mobile Event Stage Pump Track & Skate Spot Improvements Intersection Safety Improvements Drainage Improvement Project Capital Fund (CIIF) Total

xxIT1 $ 125,000 $ xxPD1 333,100 xxK01 05P03 14IT1 15,000 14K04 591,000 16IT1 50,000 16S03 39,000 16S06 274,680 17K03 17K04 18ND1 110,000 18PB1 45,000 18K01 1,250,000 18K02 18K03 18K04 18S01 50,000 18S04 50,000 $ 2,932,780 $

125,000 $ 316,300 25,000 55,500 85,000

General Fund Arterial and Collector Roadway Enhancements Wastewater Plant Expansion Phase V Advanced Manufacturing & Technology Center General Fund

xxS01 $ 250,000 $ 04W02 1,190,000 17ND1 1,165,000 $ 2,605,000 $

Restricted Funds Court Security Upgrade Police Training Room Police Interview Room Police Detective Work Area Restricted Funds Total

14CT1 $ 16PD6 18PD1 18PD2 $

Grants- Federal Advanced Manufacturing & Technology Center Grants-Federal Total

17ND1 $ 3,050,000 $ $ 3,050,000 $

$ $

Grants - Private Partners Advanced Manufacturing & Technology Center Grants - Partners Total

17ND1 $ $

$ $

Highway Fund (HURF) Quail Crossing Blvd Extension-Phase I Highway Fund (HURF) Total

05P01 $ 1,720,840 $ $ 1,720,840 $

23,690 $ 23,690 $

Debt/Capital Leases Motor Pool Vehicle Replacement Program Town Center/Public Plaza Long-Term Debt Total

xxND1 $ 18ND1 $

270,000 $ 270,000 $

Wastewater Enterprise Fund Sewer Conveyance System Rehab Program Wastewater Enterprise Fund Total

xxWW1 $ $

50,000 $ 50,000 $

GRAND TOTAL

YEAR 1 FY 2018

$ 155,000 $ 155,000 $

150,000 $ 150,000 $

YEAR2 FY 2019

YEAR 3 FY 2020

YEAR 4 FY 2021

YEAR 5 FY 2022

TOTAL YEARS 1-5

36,500 643,300 $

125,000 $ 314,000 55,000 494,000 $

125,000 $ 315,000 25,000 22,700 487,700 $

125,000 $ 625,000 325,000 1,603,400 50,000 22,700 15,000 591,000 50,000 39,000 274,680 55,500 100,000 100,000 110,000 45,000 1,250,000 35,000 35,000 85,000 55,000 86,500 50,000 585,000 $ 5,142,780

250,000 $ 250,000 $

250,000 $ 1,250,000 1,190,000 1,165,000 250,000 $ 3,605,000

$ $ 60,000 35,000 95,000 $

34,000 $ $ 34,000 $

$ $

$ 3,050,000 $ 3,050,000

$ $

$ 1,744,530 $ 1,744,530

210,000 $ 300,000 $ 5,000,000 210,000 $ 5,300,000 $ 50,000 $ 50,000 $

50,000 $ 50,000 $

34,000 155,000 60,000 35,000 284,000

150,000 150,000

300,000 $ 1,350,000 5,000,000 300,000 $ 6,350,000 50,000 $ 50,000 $

250,000 250,000

$ 10,933,620 $ 1,331,990 $ 1,038,000 $ 6,087,700 $ 1,185,000 $ 20,576,310

Arterial and Collector Roadway Enhancements

xxS01

Description Regular maintenance and rehabilitation of existing roadways throughout Town, as needed and identified through studies and/or maintenance history. Various treatment types will be utilized to maximize funding and the useful life of the roadways. Roadways are selected for treatment based on priorities outlined in the pavement preservation program.

Justification Without regularly scheduled maintenance, asphalt roads have a 20-year life. The life of a road, however, may be extended up to four times with regularly scheduled yearly maintenance. The Pavement Preservation Program outlines the regularly scheduled maintenance treatments and priorities roadways for additional maintenance as needed to expand the roadways life cycle. Without adequate maintenance, roadway replacements can cost up to 5 times the cost of preservation.

Summary of Operational Costs and Benefits This project includes pavement maintenance projects intended to extend the useful life of the facility. Routine ongoing maintenance is included in the Streets operating budget.

Useful Life

20 Years

Arterial and Collector Roadway Enhancements Costs by Year Acquisition $

250,000

Total Cost

$1,250,000 Funding Sources

General Fund 100% Strategic Plan Focus Areas

xxS01

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Wastewater Treatment Plant Phase V Expansion

04W02

Description This improvement has brought the paper capacity of the facility from 1,500,000 gallons per day to 3,000,000 gallons per day without changing the physical capacity of the facility of 1,500,000 gallons per day. This project will continue design work started with the Phase IV expansion and tie in any new design parameters necessary to meet Arizona Department of Environmental Quality (ADEQ) standards. At the time of permitting of the 3.0 MGD Aquifer Protection Permit from ADEQ, a 30% design was completed. A five year BADCT permit renewal is required. The final design and construction of Phase V will be determined by the annual capacity report generated by Public Works. Prior to the construction of the facility, a few items VE out of the Phase IV expansion will be completed.

Justification The Town of Sahuarita and future residents in the undeveloped parts of Rancho Sahuarita will also benefit from this expansion. The new capacity will allow for continued support of new development communities. These improvements will also make the surrounding area more attractive for potential merchants. The project will preserve and continue the enhancement qualities of a modern facility as relates to reductions in noise and odor and improved aesthetics of the facility for neighboring residential areas. In addition, the project will continue to ensure operational compliance of the wastewater treatment facility in accordance with State and Federal regulations.

Summary of Operational Costs and Benefits The completion of this project will increase the cost of operations and it will expand the services provided to include an increased number of residents (both private and commercial). The operational cost is not shown as the facility will not be operational until after the 5-year CIP. For future estimating, a comparison of over 30 wastewater utilities yields an average operating cost of $2/gallon. The design work referred to in the Description has not operational component. The improvements described in the Justification/Benefit section describe the enhancements to capacity in support of the Town's development efforts as well as providing clean water to be recharged into the aquifer.

Useful Life

50 Years

Wastewater Treatment Plant Phase V Expansion

04W02

Costs by Year

Acquisition $

669,620

1,190,000

Total Cost

$1,859,620 Funding Sources

Long-term Debt General Fund

31% 69%

Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Quail Crossing Boulevard Extension

05P01

Description This project will establish and new east/west connection roadway between Nogales Hwy to Old Nogales Hwy. This project has been studied for a number of years, with funding sources remaining rather elusive. At present, the majority of ROW has been acquired for a full/ultimate roadway with bridge crossing for future investment. At present, there is only enough funding for an interim at-grade, 2-lane roadway from Nogales Hwy to the west side of the Santa Cruz River. With any remaining funding, we will study options for completing the connection.

Justification The project is needed to provide an alternative east/west connection for residents of the Town of Sahuarita that are divided by the Santa Cruz river. Additionally, this area is prime for future development if this access can be completed. The current phase will provide access to undeveloped land west of the Santa Cruz, and is funded by the RTA. There is also a potential for future interim roadway phases to include public/private funding partnerships, and potential Pima County Flood control funding contributions as the need or interest in development in this area increases. Ultimate solutions could be pursued in the future when Pima County Flood control channelizes this reach of the Santa Cruz, and the cost of the ultimate bridge would be significantly reduced.

Summary of Operational Costs and Benefits The completion of this project will increase the cost of operations; however it will improve the services provided to the public. The operational costs are anticipated to be approximately $1,000 per mile/per month. Within our 5 year planning horizon this averages to $61,200 per year. This cost is partially offset by the avoided cost of repair for the roadway which is being improved (this cost was not quantified). The improvements described in the Justification/Benefit section describe the enhancements to the Town's development plans. In addition there will be improvements to the capacity and safety of the transportation system for residents and visitors.

Useful Life

20 Years

Quail Crossing Boulevard Extension

05P01

Costs by Year Acquisition $

1,320,270

1,720,840

23,690

8,935,000

Total Cost

$11,999,800 Funding Sources

Unidentified 74% PAG 17% Capital Fund 9% Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

42,000

66,000

Sahuarita Road at Interstate 19

05P03

Description Traffic Interchange Improvements: Sahuarita Road at Interstate-19. This project involves the reconstruction of an existing traffic interchange at Sahuarita Road and the I-19 and will accommodate six lanes of through traffic. The Design Concept Report (DCR) was completed in 2009. Stage IV (95%) Plans were submitted to ADOT in 2012 and revisions to the Stage IV were progressing based on ADOT comments at that time.

Justification The project will benefit the southern portion of Pima County, but specifically, the town residents using I-19 by raising the level of service of the interchange. Improving the capacity at the interchange will improve safety, allow vehicles to easily access adjacent commercial development, provide better regional connectivity, and allow future widening of I-19 (if/when determined necessary by ADOT).

Summary of Operational Costs and Benefits The completion of this project will have no effect on the cost of operations as the interchange is maintained by the Arizona Department of Transportation, however it will improve the services provided to the public. The operational cost is zero as noted. The improvements described in the Justification/Benefit section describe the enhancements to the Town's development plans. In addition there will be improvements to the capacity and safety of the transportation system for residents and visitors.

Useful Life

20 Years

Sahuarita Road at Interstate 19

05P03

Costs by Year Acquisition $

3,314,210

22,700

32,800,000

Total Cost

$36,136,910 Funding Sources

Unidentified 91% State Grants 6% Capital Fund 3% Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Parks Maintenance Building Replacement

14K04

Description Replacement of the Maintenance Building for Parks & Facilities maintenance office, workshop, and storage.

Justification The current maintenance and storage facility at Anamax Park is 30-35 years old. The building has extensive termite damage, no insulation, sagging roof trusses, and inadequate heating and cooling. The building does not meet today's building code standards. Since the opening of the Anamax Recreation Center in 2004 the current facility has been used as a maintenance building and storage facility for all department equipment and is now the only location for maintenance staff offices, recreation and maintenance storage on a large scale, as well as a shop to make repairs on equipment etc.

Summary of Operational Costs and Benefits Operational costs are expected to increase as the new facility will be air conditioned whereas the old facility used a swamp cooling system.

Useful Life

30+ Years

Parks Maintenance Building Replacement Costs by Year Acquisition $

113,000

591,000

Total Cost

$4,890,000 Funding Sources

Capital Fund 100% Strategic Plan Focus Areas

14K04

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

3,500

6,000

7,000

Rancho Sahuarita Blvd Intersection Safety Improvements

16S06

Description The Town of Sahuarita conducted a roadway safety study that was refined with funding from PAG. The results of the study included recommendations for roadway safety improvement projects and prioritized these project based on safety need. This project provides the design and construction of up to three intersection upgrades on Rancho Sahuarita Blvd. as outlined in the study at Camino Rancheria, Camino Rancho Tierra, and Rancho Caliente. Specifically, this project will add curb access ramps to bring the pedestrian access up to ADA standards, will add left turn lanes and advance warning flashers to help the number of accidents at these intersections.

Justification This project will improve traffic safety and reduce the costs and liability of pedestrian and traffic accidents in these areas.

Summary of Operational Costs and Benefits The completion of this project will increase the cost of operations and it will improve the services provided to the public. The operational cost is expected to average $5,000 per year once the project is complete. This cost will be for maintenance and upkeep. The improvements described in the Justification/Benefit section describe the enhancements to the Town's plans for transportation.

Useful Life

20 Years

Rancho Sahuarita Blvd Intersection Safety Improvements Costs by Year

Acquisition $

205,000

274,680

Total Cost

$479,680 Funding Sources

General Fund Capital Fund

6% 94%

Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

2,500

5,000

16S06

Sahuarita Advanced Manufacturing and Technology Center

17ND1

Description The proposed Sahuarita Advanced Manufacturing and Technology Center (SAMTEC) project is a multi-tenant center that provides flexible space for the innovation and commercialization and small-scale manufacturing of new technologies in the region. The project will retain and support the expansion of Hydronalix, a maritime robotics company and Control Vision—an optical sensor and control systems company; both currently located in Sahuarita. The flex-space and facility amenities at SAMTEC will also support the attraction of high-valued firms focused on innovation and commercialization. The SAMTEC project will establish a Small Business Innovation Research Community (cluster) with linear business-tobusiness linkages among existing (Hydronalix; Control Vision) and new companies in the region. The proposed project will leverage grant funding from the Economic Development Administration Economic Adjustment Assistance Program.

Justification The project will address the needs identified within Sahuarita’s Blueprint for Economic Prosperity and Growth strategic plan, providing economic diversification and furthering Sahuarita’s ability to:     

Invest in and strengthen present and future employment centers; Generate jobs commensurate with professional skills and backgrounds of citizens; Provide industrial space (the primary factor that is preventing the Town from competing for economic development prospects in the near term is the lack of); Diversify Sahuarita’s economy by addressing Town’s over-dependence in mining which puts the Town at-risk to cyclical economic condition; Provide job opportunities for the affected employees of the Sierrita Mine and Mill shut-down.

Summary of Operational Costs and Benefits Tenants of the building are expected to enter into triple-net lease agreements. Lease revenues will be used to reimburse the Town for its capital investment.

Useful Life

50 Years

Sahuarita Advanced Manufacturing and Technology Center Costs by Year Acquisition $

525,000

4,365,000

Total Cost

$4,890,000 Funding Sources

General Fund Federal Grants Private Partners

32% 62% 6%

Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

(90,000)

(180,000)

17ND1

Town Center/Public Plaza

18ND1

Description The Town Center and Public Plaza is a "vision" project identified in the Branding and Marketing Action Plan. Location, scope and cost to be determined. The project will establish a Town Center and Public Plaza in which commerce, social interaction and leisure activities mix in an attractive, pedestrian friendly, outdoor setting. An established Town Center and Public Plaza will also create a strong civic identity for the Town. Staff will first work to develop the project vision, review the potential sites to evaluate an alignment with the proposed vision and develop strategies that will be supported by an action plan providing strategic goals for the Town and staff to advance future activities. A Town Center Master Plan will be develop after the project vision phase establishing specific planning and development guidelines for the project. Town Center Master Plan will be completed in FY2018.

Justification The Town Center and Public Plaza is a "vision" project identified in the Branding and Marketing Action Plan. Location, scope and cost to be determined. The project will establish a Town Center and Public Plaza in which commerce, social interaction and leisure activities mix in an attractive, pedestrian friendly, outdoor setting. An established Town Center and Public Plaza will also create a strong civic identity for the Town.

Summary of Operational Costs and Benefits Operations and maintenance costs will not be known until the master plan is complete.

Useful Life

50 Years

Town Center/Public Plaza

18ND1

Costs by Year Acquisition $

15,000

110,000

5,000,000

Total Cost

$5,125,000 Funding Sources

Capital Fund 2% Debt 98% Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

SUSD K-8 Fields Partnership

18K01

Description This project would be a partnership between the Town of Sahuarita and the Sahuarita Unified School District. It would provide additional baseball and multi-use fields to the Town parks system for public use during non-school hours, weekends/holidays, and recreational fields for the students while operating as a school during school hours.

Justification The Town needs more ballfields for league sports and recreation.

Summary of Operational Costs and Benefits The Town will have some responsibility in the on-going maintenance of the facilities to be delineated in the IGA with the SUSD. A rough estimation of operating expenses include cost of electricity for the sports field lights and an additional 25,000 for other maintenance needs to maintain fields at Town standards.

Useful Life

30+ Years

SUSD K-8 Fields Partnership

18K01

Costs by Year

Acquisition $ $

1,250,000

Total Cost

$1,250,000 Funding Sources

Capital Fund 100% Strategic Plan Focus Areas

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

37,000

Operating Capital and Minor Projects Operating capital represents vehicle and equipment purchases costing $5,000 or more that are used by the department on a daily basis to accomplish their operational goals. Minor projects are projects costing between $5,000 and $250,000.

Motor Pool Vehicle Replacement Program xxND1

$ $

270,000

Total Cost: $1,350,000

270,000

210,000

300,000

Ongoing replacement of older vehicles. Between seven to ten vehicles will be replaced per year. Does not include police patrol vehicles.

Acquisition

Server & Computer Replacement Program xxIT1

$ $

125,000

Total Cost: $625,000

125,000

Ongoing replacement of old technology, including computers, servers, routers, switches, phones, etc.

125,000

PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition -

Police Patrol Vehicle Replacement Program xxPD1

$ $

333,100

Total Cost: $1,603,400

316,300

Ongoing replacement of older patrol vehicles, including motorcycles. About five to six vehicles will be replaced per year. Cost includes vehicle equipment and installation.

314,000

315,000

325,000

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

(7,500)

Acquisition

Park Playground Canopy Replacement Program xxK01

Total Cost: $50,000

25,000

Ongoing replacement of playground shade structure canopies at Town parks.

Operations

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Sewer Conveyance System Rehab Program xxW01

50,000

Total Cost: $250,000

50,000

Ongoing improvements to system manholes and pipelines. Project improvements will extend the useful life or enhance the utilization of the sewer conveyance system.

Acquisition

Municipal WiFi 14IT1

30,180

Total Cost: $45,180

15,000

Purchase and deployment of wireless access points throughout Town Hall, the Wastewater Treatment Plant, and various parks.

Total Cost: $34,000

34,000

Town Hall Conference Room Upgrades 16IT1 Total Cost: $100,000 Upgrade outdated equipment in the Town Hall conference rooms with new audio/visual and computer equipment.

PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

Court Security Upgrade 14CT1 Upgrade the Municipal Court's security vestibule with more advanced technology equipment.

Operations

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

(5,800)

Acquisition

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition $

50,000

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

1,500

3,000

Police Training Room 16PD6

Total Cost: $155,000

Facility improvement creating a multipurpose room for trainings and meetings, accommodating up to 40 people.

Acquisition 155,000

Pima Mine Rd. Bike Lanes / Paved Shoulders 16S03

13,000

39,000

Total Cost: $52,000

Connect bike lanes (paved shoulders) on Pima Mine Road from the Desert Diamond Casino to Rancho Sahuarita Boulevard.

Old Park Maintenance Building Demolition 17K03 Total Cost: $55,000 Demolish old Park Maintenance Building and septic system. Make area available for expanded, unpaved parking.

Portable Generator & Equipment 17K04 Total Cost: $100,000 Purchase 100KV portable generator, distribution boxes, and power cables. Will be used at Town events and for emergency power.

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

5,000

Acquisition $

55,500

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition $

$ $

100,000 -

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

400

Police Interview Room 18PD1

Total Cost: $60,000

Modify Police Department building, creating two interview rooms.

60,000

Acquisition

Police Detective Work Area 18PD2

Total Cost: $35,000

35,000

Development Services ERP 18PB1

Total Cost: $45,000

45,000

ERP

PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

Police Department building modification, creating one large workroom for Police Detectives.

Acquire cloud-based development services.

Operations

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

for

Concrete Path at Anamax Dog Park 18K02

Total Cost: $35,000

35,000

Install concrete path around Anamax dog park turf areas. Pathway will be ADA compliant.

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

(4,490)

(7,000)

(4,350)

(1,500)

1,550

Acquisition

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Mobile Event Stage 18K03

Total Cost: $85,000

Purchase a mobile stage for use on events located anywhere in Town.

85,000

Acquisition

Pump Track & Skate Spot Improvements 18K04

Total Cost: $55,000

55,000

Construct an off-road terrain (pump) track for bicycles and make improvements to skate spot at Anamax Park.

850

1,500

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition $

50,000

36,500

Intersection safety improvements at Abrego Drive and Nogales Highway, including flashers, reducing speed limits and signs, or enhancing the visibility of signal heads.

Drainage Improvement Project 18S04

Acquisition $

Total Cost: $50,000

60,000

Improve or repair the wash along Duval Road. Improvements may include rock baskets for bank protection.

Total Cost: $86,500

Total Projects: 20 Total Cost: $4,778,400

PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

Acquisition

Intersection Safety Improvements 18S01

Operating & Minor Projects Five-Year Totals

Operations

1,182,100

1,058,300

788,000

815,000

935,000

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

5,000

Operations PRIOR FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FUTURE

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

(16,290)

3,550

6,850

9,700

13,150

DEBT The Town uses debt to acquire public infrastructure and assets. This debt is paid back over a timeframe that is no longer than the life of the infrastructure and assets acquired. This provides for intergenerational equity in public financial managementâ&#x20AC;&#x201D;a concept where taxpayers finance all current expenditure and sponsor in the financing of inherited productive assets with respect to how much benefit is received from the assets. Stated another way, those who benefit are the ones who pay for the benefit received. The enhancements were for many different functions of the Town, including streets, parks, judicial courts, police headquarters, and general government. Information about total debt, each debt instrument, its use and its repayments follow.

Quail Creek Community Facilities District (QC CFD) General Obligation Bonds In June 2006, the District issued $12.66 million in bonds to provide funds for the construction and acquisition of enhanced infrastructure within the District boundaries, including sewer lines, streets, and a park. In December 2017, all outstanding bonds totaling $9.62 million were refunded. Interest (rates @ 5.00-3.25%) is payable semi-annually and is calculated based upon the principal amount of the refunding bonds outstanding during such period. The bonds are payable from the Districtâ&#x20AC;&#x2122;s property tax revenues through 2030. If the property tax revenues are insufficient to make the required payments, the developer of Quail Creek CFD will make a contribution sufficient to make the payment. Remaining principal and interest on all QC CFD debt total:

Year Ending June 30 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 TOTAL

Principal $ 365,000 670,000 685,000 705,000 725,000 745,000 770,000 795,000 815,000 840,000 865,000 890,000 920,000 $ 9,790,000

Interest $ 286,763 279,463 266,063 245,513 224,363 202,613 180,263 157,163 133,313 108,863 83,663 57,713 29,900 $2,255,650

Total Debt Payment $ 651,763 949,463 951,063 950,513 949,363 947,613 950,263 952,163 948,313 948,863 948,663 947,713 949,900 $12,045,650

Capital Infrastructure Improvement Fund (CIIF) Greater Arizona Development Authority (GADA) Loans The Town has borrowed money from the financial markets through GADA, an agency of the State. The GADA secures loans from municipalities and other governmental agents and sells these as bonds on the securities market.

In March 2006 and June 2009, the Town entered into loan agreements with the Greater Arizona Development Authority (GADA) in the amounts of $16.355 million and $6.7 million, respectively. The Town received loans in exchange for pledged future State-shared revenues and excise tax collections, which GADA used as security for its bond issuances. Proceeds of the loans provided financing for the construction of municipal complex, which includes a courthouse, the police headquarters, and town hall, as well as road projects and improvements to North Santa Cruz Park. Interest (rates @ 4.0-5.0%) is payable semi-annually and is calculated based upon the principal amount of the loans outstanding during such period. The loans are payable from the revenues of the Townâ&#x20AC;&#x2122;s governmental funds through 2029. Remaining principal and interest on the loans total:

Excise Tax Refunding Obligation In March 2015, the Town entered into an agreement with Wells Fargo Bank, N.A. to refinance (i.e., advance refund) $8.125 million of the outstanding GADA 2006 loan obligation. The Town has pledged future excise taxes toward repayment. Interest (rates @ 1.98%) is payable semiannually and is calculated based upon the principal amount of the balance outstanding during such period. The loan is payable from the revenues of the Townâ&#x20AC;&#x2122;s governmental funds through 2025. Remaining principal and interest on the loans total:

Capital Leases The Town has entered into five-year capital lease agreements through 2022 to finance the acquisition of vehicles. Remaining principal and interest on all CIIF debt total:

Year Ending June 30 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 TOTAL

Principal $ 1,157,500 1,588,750 1,653,750 1,695,448 1,742,100 1,565,000 1,610,000 1,655,000 445,000 465,000 490,000 515,000 $14,582,548

Interest $ 447,320 432,864 407,370 372,651 336,420 226,102 184,451 141,354 95,750 73,500 50,250 25,750 $2,793,780

Total Debt Payment $ 1,604,820 2,021,614 2,061,120 2,068,098 2,078,520 1,791,102 1,794,451 1,796,354 540,750 538,500 540,250 540,750 $17,376,328

Wastewater Fund Water Infrastructure Finance Authority Loans In April 2008, the Town entered into two loan agreements with the Water Infrastructure Finance Authority of Arizona (WIFA) to provide funds for the construction and design of several wastewater treatment plant expansions; a system revenue loan for $28.35 million and a nonsystem revenue loan for $3.52 million. Interest (rate @ 3.723%) is payable semi-annually and is calculated based upon the principal amount of the loan outstanding during such period. For the 2008 WIFA System Revenues Loan, the Town has pledged wastewater system resources, net of specified operating expenses. Annual principal and interest payments on the loan are expected to require all of the wastewater systemâ&#x20AC;&#x2122;s net revenues. For the 2008 WIFA Non-System Revenues Loan, the Town has pledged wastewater system resources, net of specified operating expenses, and the excess of non-system revenues (i.e. excise taxes) not pledged towards other debt. Annual principal and interest payments on the loan are expected to obligate less than 5% of pledged resources.

Capital Lease The Town has entered into ten-year capital lease agreement through 2025 to finance the acquisition of a modular building for the utility.

Remaining principal and interest on all Wastewater Fund debt total:

Year Ending June 30 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 TOTAL

Principal $ 1,592,880 1,652,241 1,713,814 1,777,682 1,843,930 1,912,647 1,983,925 2,057,860 2,104,895 2,183,261 2,264,544 $21,087,677

Interest $ 785,628 726,267 664,694 600,826 534,577 465,860 394,582 320,647 243,957 165,592 84,309 $4,986,938

Total Debt Payment $ 2,378,507 2,378,507 2,378,507 2,378,507 2,378,507 2,378,507 2,378,507 2,378,507 2,348,852 2,348,852 2,348,853 $26,074,615

THE BUDGETARY PROCESS FUND COMPOSITION The Townâ&#x20AC;&#x2122;s financial reporting entity is comprised of seven funds: (1) General Fund, (2) Highway User Revenue Fund, (3) Grants & Restricted Sources Fund, (4) Quail Creek Community Facilities District Fund, (5) Rancho Sahuarita Community Facilities District Fund, (6) Capital Infrastructure Improvement Fund, and (7) Wastewater Enterprise Fund. The Town adopts budgets for all of these funds.

BASIS OF PRESENTATION As in prior years, departments are budgeted on a functional unit basis to emphasize the programmatic components of Town Services. Accordingly, the fiscal year 2017 budget shows the costs associated with each department and for capital projects.

BUDGETARY CONTROL The Townâ&#x20AC;&#x2122;s adopted budget serves as a legal operating plan for the fiscal year. While its primary function is to provide a planning and allocation tool, it also serves management by providing the basis for measuring performance during the year. The adopted budget has two levels of budgetary constraints: 1) within the operating funds, expenditures may not legally exceed appropriations at the department level and 2) within the Capital Infrastructure Improvement Fund expenditures may not legally exceed the functional level of budgeted projects. To monitor compliance with these budgetary constraints, revenue and expenditure reports and budget-versus-actual analyses are prepared periodically by the Finance Department and are reported to the Town Manager and the Town Council. These reports provide not only a mechanism for monitoring performance, but also for adjusting (when necessary) departmental operating plans and resource utilization.

BUDGET AMENDMENTS While state statutes prohibit the Town from exceeding the final adopted budget amount, the budget is still just a planning document, and as such remains sufficiently flexible to accommodate changes that may occur during the fiscal year. There are two categories of change that may be needed: 1) those affecting line items within a single department and 2) those requiring a transfer between departments or funds. In the first instance, the Town Manager retains the authority to modify line item amounts within the departmental budgets, provided the total program budgeted amount remains unchanged. In the second instance, the Town Manager has the authority to evaluate departmental requests for changes between departments and make recommendations for approval to the Town Council. Should the Town Manager recommend the change to the Town Council, the recommendation will be considered at a regularly scheduled, open meeting of the Town Council.

BUDGET PREPARATION AND APPROVAL Zero-Base Budgets Every department shall develop an annual budget using a zero base budget methodology. Under this approach, no target is established. The department evaluates its current level of operations, its programmatic structure, and its staffing in the context of its mission statement and the departmentâ&#x20AC;&#x2122;s goals and objectives. Organizational revisions are made, if beneficial to the achievement of department goals. Programs are then divided into services which define the departmentâ&#x20AC;&#x2122;s product, or benefit, to the Town. Each program is individually budgeted and can be individually evaluated. Each line item for each program is evaluated and justified. During the year, the actual cost of each program can be captured and variances from budget monitored and analyzed. Capital Improvement Budget On an annual basis, the Town Manager prepares a five-year Capital Improvement Plan (CIP), the first year of which becomes the capital budget. A summary of capital improvement projects for fiscal year 2018 to 2022 is provided in Capital Improvement Plan section of this document.

BUDGET/CIP CALENDAR Date December 2016

Action Budget/CIP Calendar Finance establishes dates for milestone events and components needed to develop the budget.

January 2017 (various dates)

Preliminary revenue projections prepared by Finance Finance prepares five-year revenues projections for all Town funds.

Staff meetings-financial/budget overview During the month of January, the Finance Director communicates with other department heads in order to share the results of preliminary revenue projections and to ensure all departments understand the deadlines and the information required to fulfill each deadline.

Meetings with Technology Division to review technological needs During the month of January, the Technology Manager meets with departments to determine any technological needs and identify the most efficient and effective methods for the Town to address its needs. January 27, 2017

CIP Project Sheets due to Finance Capital Improvement Plan worksheets need to be completed in order for any CIP project to be considered by the Town Manager for recommendation as part of the Budget.

Preliminary departmental (Level 1) budget requests due to Finance (MUNIS) Initial identification of expenditures levels and expected revenue collections need to be entered by each department in order to meet the preliminary (Level 1) cut off. February 10, 2017

Final departmental (Level 2) budget requests due to Finance (MUNIS) Requests for expenditure levels must be reviewed and approved by each department head by this date.

February 27 – March 10, 2017

Departmental meetings with Town Manager to review budget requests Meetings are held by the Town Manager with each department head to review the budget request and determine how the Town Manager will use the requests to create the Manager’s recommended budget for Town Council.

March 13 – 24, 2017

Department follow-up meetings with Town Manager (as needed) Initial meetings may leave questions unresolved. This step provides time for resolution prior to the creation of the Town Manager’s recommended budget.

Date April 28, 2017

Action Manager Recommended Budget and CIP delivered to Town Council Members Once the Town Manager has finalized a recommendation for the whole Town, a study document is prepared for the Town Council. This document is provided to the Council in preparation for the first public review of the budget by the Council.

May 8, 2017

Town Council study session on the budget and CIP Public meeting at which a presentation is made to the Council by the Town Manager (or an assignee). This provides an opportunity for public review and comment. Council may request the Manager adjust any or all items in the budget at this time.

Quail Creek CFD Board Tentative Budget approval In compliance with State statutes, the governing board of the Quail Creek Community Facilities District will hold a public meeting to determine if the budget will be adopted on a tentative basis. May 22, 2017

Town Council study session on the budget and CIP (if needed) Depending on the request of Council, a follow up public study session is available to review the budget prior to its tentative adoption.

Public Hearing and adoption of the Quail Creek CFD 2018 Budget In compliance with State statutes, the governing board of the Quail Creek Community Facilities District will hold a public hearing and determine if the budget will be adopted. June 12, 2017

Town Council Tentative Budget approval In compliance with State statute, the Council holds a public meeting to determine if the budget will be adopted on a tentative basis.

Rancho Sahuarita CFD Board Tentative Budget approval In compliance with State statutes, the governing board of the Rancho Sahuarita Community Facilities District will hold a public meeting to determine if the budget will be adopted on a tentative basis. June 26, 2017

Public hearing and adoption of the Town 2018 Budget and CIP In compliance with State statute, the Council will hold a public hearing at a special meeting to determine if the budget will be adopted for the upcoming year.

Public Hearing and adoption of the Rancho Sahuarita CFD 2018 Budget In compliance with State statutes, the governing board of the Rancho Sahuarita Community Facilities District will hold a public hearing and determine if the budget will be adopted for the upcoming year.

FINANCIAL AND BUDGETARY POLICIES Adopted financial polices reflect the Town’s commitment to sound financial management and fiscal integrity. They also provide stability by helping Town officials plan fiscal strategy with a consistent approach. The Town has an important responsibility to its citizens to carefully account for public funds, to manage its finances wisely, and to plan for the adequate funding of services desired by the public, including the provision and maintenance of public facilities. These policies set forth guidelines against which current budgetary performance can be measured and proposals for future programs can be evaluated. General Financial Goals     

To maintain a financially viable municipal government that can provide an adequate level of services. To maintain financial flexibility to be able to continually adapt to local and regional economic changes. To maintain and enhance the sound fiscal condition of the Town. To deliver quality services in an affordable, efficient, and cost-effective basis providing full value for each tax dollar. To maintain a high credit rating to ensure the Town has access to long-term debt at the most affordable cost.

Following these principles will enhance the Town’s financial health as well as its image and credibility with its citizens, the public in general, bond rating agencies, and investors. To achieve these purposes it is important to regularly engage in the process of financial planning including reaffirming and updated these financial guidelines. Policy changes will be needed as the Town continues to grow and become more diverse and complex in the services it provides, as well as the organization under which it operates to provide these services. 1. Fiscal Planning and Budgeting Policies Fiscal planning refers to the process of identifying resources and allocating those resources among numerous and complex competing purposes. The primary vehicle for this planning is the preparation, monitoring, and analysis of the Town’s budget. 1.1. The Town will adopt a balanced budget by June 30 of each year. The total of proposed expenditures shall not exceed the total of estimated income and fund balances. 1.1.1. Each year the Town Manager shall prepare and recommend to the Town Council a preliminary budget where revenues equal or exceed expenditures in the General Fund. The Town Manager may also present budget alternatives that deviate from this provision in order to accommodate circumstances that may arise in any given year. 1.2. The Town will prepare a budget in accordance with the framework established by the National Advisory Council on State and Local Budgeting and the Government Finance Officers Association. 1.3. The budget will be used as a fiscal control device as well as a financial and service level plan. 1.4. All departments will participate in the responsibility of meeting policy goals and ensuring long-term financial health. 1.5. Town Council and Town Management exercise budgetary control. Except as provided in this section, all budget transfers or appropriations of fund balances require the approval of the Town Council.

1.5.1. Budget transfers of fund balances assigned to Management for contingencies require the approval of the Town Manager. The Town Manager will provide the Town Council a report accounting for such transfers. 1.5.2. Budget transfers between accounts within the same department require the approval of the Town Manager or Finance Director. 1.6. The Finance Director will prepare a budget calendar no later than January of each year. 1.7. Budget development will use strategic multi-year fiscal planning, conservative revenue and expenditure forecasts. 1.8. The budget will be prepared in accordance with State Law in the format approved by the Arizona Auditor General and be consistent with generally accepted accounting principles (GAAP) where possible. 1.8.1. Budgetary schedules shall be prepared to demonstrate total financial sources equal total uses for each fund. 1.8.1.1. Budgeted financial sources shall include revenues, beginning fund balances, net debt proceeds, net interfund transfers, and other inflows. 1.8.1.2. Budgeted uses shall include expenditures, ending fund balances, and other outflows. 1.8.2. All funds will use the current financial resources measurement focus and will account for budgeted revenues and expenditures under the modified accrual basis of accounting. 1.8.2.1. Revenues are recognized when they become both measurable and available. 1.8.2.2. Expenditures are recognized when they become incurred and measurable, and/or require the use of current financial resources. 1.8.2.2.1. Depreciation is not budgeted. 1.8.2.2.2. Capital purchases are budgeted as expenditures in all funds. 1.8.2.2.3. Compensated absence liabilities that become due are budgeted as expenditures in all funds. 1.8.2.2.4. Debt payments are budgeted as expenditures in all funds. 1.8.2.3. The use of the modified accrual basis of accounting for budgetary purposes in the Wastewater Enterprise Fund departs from GAAP, which prescribes the use of the full accrual basis of accounting for proprietary funds in the annual financial statements. 1.9. Alternatives for improving the efficiency and effectiveness of the Townâ&#x20AC;&#x2122;s programs and the productivity of its employees will be considered during the budget process. Duplication of services and inefficiencies should be eliminated wherever they are identified. 1.10. The Town shall establish appropriate management controls to monitor expenditure budgets to ensure they do not exceed authorizations. 1.11. During the course of the year, the Town Manager is charged with the responsibility to take steps to reduce expenditures or increase revenues to the extent necessary to ensure that actual changes to fund balances in the General Fund are no lower than that planned for in the budget at the close of the fiscal year. The Town Manager may institute a cessation during the fiscal year on hirings, promotions, transfers, and capital equipment purchases. Such action will only occur after sending the Town Council notice of such actions. 1.12. The Town will avoid budgetary and accounting procedures which balance the current budget at the expense of future budgets. 2. Revenue Policies Because revenues are sensitive to both local and regional economic conditions, revenue estimates should be conservative.

2.1. Staff will estimate annual revenues by an objective, analytical process utilizing trend, judgmental, and statistical analysis as appropriate. 2.2. The Town will attempt to maintain a diversified and stable revenue system in order to: 2.2.1. Decrease reliance on general taxation for discretionary but desirable programs and services and rely more on fees and charges. 2.2.2. Decrease the vulnerability of programs and services to reductions in tax revenues as a result of economic fluctuations. 2.2.3. Increase the level of self-support for new program initiatives and enhancements. 2.3. One-time revenues will be limited to the purpose for which they are intended or, to the extent possible, for one-time expenditures. 2.4. User fees and charges for services will be reviewed periodically to determine the adequacy of cost recovery. 3. Expenditure Policies Management must ensure compliance with the legally adopted budget. In addition, purchases and expenditures must comply with legal requirements and policies and procedures set forth by the Town Council. 3.1. Expenditures will be controlled by an annual appropriated budget, established by the Town Council. 3.2. Department heads are responsible for monitoring expenditures to prevent exceeding their total departmental expenditure budget. It is the responsibility of these department heads to immediately notify the Finance Director and Town Manager of any circumstances that could result in a departmental budget being exceeded. 3.3. The Town will maintain a purchasing system that provides needed commodities and services in a timely manner to avoid interruptions in the delivery of services. All purchases shall be made in accordance with the State statutes, the Townâ&#x20AC;&#x2122;s procurement code, purchasing policies, guidelines, and procedures. 3.4. The Town will endeavor to obtain supplies, equipment, and services that provide the best value. 3.5. The Town will make all payments within established terms. 3.6. The Arizona Constitution sets a limit on the expenditures of local jurisdictions. The Town will comply with these expenditure limitations and will submit an audited expenditure limitation report, audited financial statements, and audited reconciliation report as defined by the Uniform Expenditure Reporting System to the State Auditor General within prescribed timelines. 3.7. The Town will maintain a level of expenditures which will provide for the health, safety and welfare of the residents of the community. 3.8. The Town will maintain capital assets and infrastructure at a sufficient level to protect the Townâ&#x20AC;&#x2122;s investment, to minimize future replacement and maintenance costs, and to continue service levels. 4. Grants Many grants require appropriation of funds, either for the original grant or to continue programs after the grant funding has expired. The Town should review these grant programs prior to determining whether application should be made for these grant funds. 4.1. The Town shall only apply for those grants that are consistent with the objectives identified by Council. The potential for incurring ongoing costs, to include the assumption of support for grant funded positions from local revenues, will be considered prior to applying for a grant.

4.2. The Town shall attempt to recover all allowable costs—direct and indirect—associated with the administration and implementation of programs funded through grants. The Town may waive or reduce indirect costs if doing so will significantly increase the effectiveness of the grant. 4.3. The Town will maintain a system of internal controls which provide reasonable assurance of compliance with laws, regulations, and the provisions of contract and grant agreements. 4.3.1. The objectives of internal control pertaining to the compliance requirements for grant programs are as follows: 4.3.1.1. Transactions are properly recorded and accounted for to: 4.3.1.1.1. Permit the preparation of reliable financial statements and grant reports; 4.3.1.1.2. Maintain accountability over assets; and 4.3.1.1.3. Demonstrate compliance with laws, regulations, and other requirements; 4.3.2. Transactions are executed in compliance with laws, regulations, and the provisions of contracts or grant agreements that could have a direct and material effect on a grant program; and 4.3.3. Funds, property, and other assets are safeguarded against loss from unauthorized use or disposition. 5. User Fee Cost Recovery and Indirect Cost Allocations User fees and charges are payments for voluntarily purchased, publicly provided services that benefit specific individuals. The Town relies on user fees and charges to supplement other revenue sources in order to provide public services. Indirect cost charges are assessed to recover a portion of the costs for services provided between various funds. 5.1. The Town may establish user fees and charges for certain services provided to users receiving a specific benefit. 5.2. User fees shall be reviewed periodically to calculate their full cost recovery levels, to compare them to the current fee structure, and to recommend adjustments where needed. The calculation of full cost will include all reasonable and justifiable direct and indirect cost components. 5.3. The Town shall establish a cost allocation plan to determine annually the administrative service charges due to the appropriate cost centers. Where appropriate, funds shall pay these indirect cost charges for services provided by another fund. 6. Cash Management and Investment Cash management includes the activities undertaken to ensure maximum cash availability and maximum investment yield on a government’s idle cash, and the cash collection function. 6.1. The Town shall maintain and comply with a written investment policy that has been approved by the Town Council. The investment policy will emphasize safety and liquidity before yield. 6.2. The Town will collect, deposit, and disburse all funds on a schedule that insures optimum cash availability for investment. 6.3. In order to maximize yields from its overall portfolio, the Town will consolidate cash balances from various funds for investment purposes, and will allocate investment earnings to each participating fund. 6.4. The Town will project its cash needs to optimize the efficiency of the investment and cash management program. 6.5. The Town will conduct its treasury activities with financial institutions based upon written contracts. 6.6. Ownership of the Town’s investment securities will be protected through third party custodial safekeeping.

6.7. All Town bank accounts shall be reconciled and reviewed on a monthly basis. 6.8. The Town may use short-term debt to cover temporary or emergency cash flow shortages. All shortterm borrowing will be subject to Council approval. 7. Capital Asset Accounting, Depreciation, and Replacement An effective capital asset accounting system is important in managing the Town’s capital asset investment. 7.1. The Town will maintain a capital assets system for assets with values of $5,000 or more. All items less than $5,000 will be recorded as operating expenditures. 7.2. Annual budgets including reserves will provide for adequate design, construction, maintenance and replacement of Town’s capital assets in accordance with the current year of the capital improvement plan. 7.3. The Town will project equipment replacement and maintenance needs for the next five years and will update this projection each year. 7.4. The Town will ensure that depreciation expense is allocated in a systematic and rational manner to those periods expected to benefit from the use of the asset. 7.4.1. The straight-line method of depreciation, using the half-year convention, will be used for all depreciable assets. 7.4.2. The useful life of an asset will be based upon the Town’s history with said asset or similar asset type. In the absence of an adequate history, the Town will follow useful life guidelines provided by reputable organizations such as the Government Finance Officers Association. 7.5. Vehicles will be replaced on an as needed basis after consideration of safety issues and financial impacts. 7.6. An inventory of capital assets shall be performed on a periodic basis, at least every 3 years. 7.7. The Town will evaluate prominent events or changes in circumstances affecting capital assets to determine whether impairment of a capital asset has occurred and whether the assets need to be revalued in accordance with Governmental Accounting Standards Board Statement No. 42. 8. Capital Improvement Plan Policies The purpose of the Capital Improvement Plan is to systematically identify, plan, schedule, finance, track and monitor capital projects to ensure cost-effectiveness as well as conformance to established policies. 8.1. The Town will make all capital improvements in accordance with an adopted and funded capital improvement plan. 8.2. The Town will develop an annual five-year plan for capital improvements, including design, development, and implementation. 8.3. Staff will identify the estimated capital costs, the estimated operating costs, potential funding sources and project schedule for each capital project proposal before it is submitted to the Council for approval. 8.4. The Town will use intergovernmental assistance and other outside resources whenever possible to fund capital improvements providing that these improvements are consistent with the capital improvement plan and Town priorities. 8.5. When current revenues or resources are available for capital improvement projects, consideration will be given first to those capital assets with the shortest useful life and/or to those capital assets whose nature makes them comparatively more difficult to finance with debt financing. Using cash for projects with shorter lives and debt for projects with longer lives facilitates “intergenerational equity”.

8.6. Staff will monitor projects in progress to insure their timely completion or the adjustment of the Capital Improvement Plan as approved by Council. A quarterly status report will be presented to the Town Council to monitor each project’s progress and to identify any significant issues. 8.7. The current year of the capital improvement plan will become the capital budget. 9. Long-Term Debt Policies The Town utilizes long-term debt to finance capital projects with long useful lives. Financing capital projects with debt provides for an “intergenerational equity”, as the actual users of the capital asset pay for its cost over time, rather than one group of users paying in advance for the costs of the asset. The purpose of this debt management policy is to provide for the preservation and eventual enhancement of the Town’s bond ratings, the maintenance of adequate debt service reserves, compliance with debt instrument covenants and provisions, and required disclosures to investors, underwriters and rating agencies. These policy guidelines will also be used when evaluating the purpose, necessity and condition under which debt will be issued. These policies are meant to supplement the legal framework of public debt laws provided by the Arizona Constitution, State statutes, federal tax laws, and the Town’s current debt resolutions and covenants. The Arizona Constitution limits a Town’s bonded debt capacity (outstanding principal) to certain percentages of the Town’s secondary assessed valuation by the type of project to be constructed. There is a limit of 20% of secondary assessed valuation for projects involving water, sewer, artificial lighting, parks, open space, recreational facility improvements, and transportation. There is a limit of 6% of secondary assessed valuation for any other general purpose project. 9.1. The overall debt management policy of the Town is to ensure that financial resources of the Town are adequate in any general economic situation to not preclude the Town’s ability to pay its debt when due. 9.2. The Town will confine long-term borrowing to capital improvements, capital acquisitions, and the refinancing of prior year long-term debt. 9.3. The life of the debt service payments will not exceed the useful life of the capital assets acquired with the debt proceeds. 9.4. Proceeds from long-term debt will not be used to fund current on-going operations. 9.5. The issuance of variable rate debt by the Town will be subject to the most careful review and will be issued only in a prudent and fiscally responsible manner. 9.6. The Town shall make every effort to combine debt issuances in order to minimize issuance costs. 9.7. The investment of bond proceeds shall at all times comply with the requirements of debt covenants. 9.8. The Town shall comply with all U.S. Internal Revenue Service arbitrage rebate requirements. 9.9. Before any new debt is issued, the impact of debt service payments on total annual fixed costs will be analyzed. 9.10. The Town will maintain a revenue-to-debt service ratio of at least 5 to 1 for its governmental activities debt. 9.11. The Town will only issue new debt if, in the Capital Infrastructure Improvement Fund, the projected net recurring funding sources exceed the estimated annual debt service expenditures in each year of the five year period covered in the Capital Improvement Plan.

10. Fund Balance Policies Fund balance is an important indicator of the Townâ&#x20AC;&#x2122;s financial position. Adequate fund balances must be maintained to allow the Town to continue providing services to the community. 10.1. In accordance with Governmental Accounting Standards Board Statement No. 54, fund balances will be classified in the following components: 10.1.1. Nonspendable fund balance: balances that are not in spendable form or with a requirement to maintain intact 10.1.2. Restricted fund balance: balances that have externally enforceable limitations on their use imposed by creditors, grantors, contributors, constitutional limitations, or legal limitations 10.1.3. Committed fund balance: balances that have self-imposed limitations resulting from formal action taken by the Town Council 10.1.4. Assigned fund balance: balances that have limitations resulting from intended use 10.1.5. Unassigned fund balance: all residual net resources in the total fund balances not otherwise included in one of the above categories 10.2. Fund balances will be reserved to offset difficult economic times, stabilize fluctuations in cash flow requirements, and provide for emergency situations. 10.2.1. Stabilization reserves shall be established each year and be incorporated into the budget. 10.2.1.1. Each fund should maintain minimum fund balances equivalent to 25% of its adopted operating budget for the year. The General Fund minimum balance requirement shall also include any operating reserve deficiencies of other funds. 10.2.1.2. Each fund should maintain minimum fund balances equivalent to 20% of its adopted capital outlay budget, adjusted for amounts not subjecting the Town to obligation, for the year. The Capital Infrastructure Improvement Fund minimum balance requirement shall also include any capital reserve deficiencies of other funds. 10.2.2. Stabilization reserves may only be appropriated by authorization of the Town Council. A plan will be developed to adequately replenish reserves when appropriations are projected to reduce reserves below the required minimum levels. 10.3. Unassigned fund balances will be maintained to provide for unforeseen opportunities. 10.3.1. The Town desires to have a $10 million unassigned fund balance in the General Fund by the end of fiscal year 2020. Town Management shall develop a financial plan to reach this target. Until such time, any appropriations that cause this fund to decrease shall be accompanied with a plan to replenish the balance within a reasonable timeframe. 10.4. When more than one resource is available to fund outlays for a particular purpose, the most constrained source will be depleted before others sources are consumed; starting with restricted fund balances, followed by committed fund balances, assigned fund balances and lastly unassigned fund balances. 11. Enterprise Funds Government enterprises generate revenue to offset the cost of providing certain services. User charges are established to offset the cost of providing these services. The accounting systems must be established to separate these revenues and expenses. 11.1. Separate funds will be established and maintained to properly account for each enterprise operation. Enterprise funds will not be used to subsidize the operations of other funds. Inter-fund charges will be assessed for the administrative support of the enterprise activity.

11.2. The Town will establish rates and fees at levels to fully cover the total direct and indirect costs, including operations, capital outlay, unrestricted cash reserve balances, debt service, and debt coverage requirements. 12. Accounting, Auditing, and Financial Reporting Accounting, auditing, and financial reporting form the informational infrastructure for public finance. Internal and external financial reports provide important information to the Town’s legislative body, management, citizens, investors, and creditors. 12.1. The Town's accounting and financial reporting systems will be maintained in conformance with generally accepted accounting principles and standards promulgated by the Governmental Accounting Standards Board. 12.2. Financial reports for each quarterly period will be submitted to the Finance and Investment Advisory Committee and the Town Council. 12.3. The Finance and Investment Advisory Committee will provide financial oversight and will recommend ways to improve processes and procedures as needed. 12.4. Relevant and comprehensive disclosure will be provided in the general financial statements and bond representations. 12.5. The Comprehensive Annual Financial Report will present the status of the Town’s finances on a basis of generally accepted accounting principles. 12.6. An annual audit will be performed by an independent public accounting firm with the subsequent issue of an official Comprehensive Annual Financial Report and Annual Expenditure Limitation Report. 12.7. The Town will develop and manage its accounting system to provide reasonable assurance regarding: 12.7.1. The safeguarding of assets against loss from unauthorized use or disposition. 12.7.2. Reliability of financial records for preparing financial statements and maintaining accountability for assets. 12.8. The Comprehensive Annual Financial Reports and Annual Adopted Budgets will be posted on the Town’s website and made available to the public. 12.9. The Town will participate in the Government Finance Officers Association’s award programs with the intent of receiving the Certificate of Achievement for Excellence in Financial Reporting and the Distinguished Budget Presentation Award. 13. Risk Management Risk management is involved in the identification, evaluation, and treatment of the Town’s exposure to risk. Risk management has become increasingly important in guarding against economic loss an in ensuring public safety in a time of increasing public liability and litigation. 13.1. The Town shall make diligent efforts to prevent or mitigate the loss of Town assets and to reduce the Town’s exposure to liability through training, risk financing, and the transfer of risk when cost effective. 13.2. The Town shall manage its exposure to risk through the purchase of third-party insurance for general liabilities, automotive liabilities, property losses, and workers’ compensation. 13.3. When applicable, the Town will control its exposure to risk through the use of “hold harmless” agreements in Town contracts by requiring contractors to carry liability insurance, including errors and omissions coverage for architectural, engineering, and other professional firms.

LEGAL REQUIREMENTS STATE SPENDING LIMITATION The Town of Sahuarita, like all counties and municipalities in Arizona, is subject to numerous budgetary and related legal requirements. Article 9, Section 20, (1) of the Arizona Constitution sets limits on the Town’s legal budget capacity. In general, the Town Council cannot authorize expenditures of local revenues in excess of the expenditure limitations determined annually by the Arizona Economic Estimates Commission. This limitation is based upon a calculated amount of expenditures for fiscal year 1979-80 (prior to the Town’s incorporation), adjusted to reflect subsequent inflation and population growth. Not subject to this limit are items such as bond proceeds, related debt service, interest earnings, special voter approved districts, certain highway user revenue funds, federal funds, monies received pursuant to intergovernmental agreements, and state grants which are to be used for specific purposes. The Town demonstrates compliance with these requirements by filing the audited Annual Expenditure Limitation Report with the Office of the Arizona Auditor General.

TENATIVE BUDGET PREPARATION AND PUBLICATION State law (ARS §42-17101) requires that on or before the third Monday in July of each fiscal year, the Town Council must prepare an estimate of expenditures and revenues. Town of Sahuarita refers to these estimates as the Tentative Budget. According to ARS §42-17101, this Tentative Budget must be included in the Town Council meeting minutes and, must be fully itemized in accordance with forms supplied by the Auditor General. (See the Official Budget Forms section.) ARS §42-17102 defines the contents of the estimates. The Tentative Budget and the reports include all monies used for Town purposes including interest and principal payments on bonds. ARS §42-17103 requires publication of the Tentative Budget once a week for at least two consecutive weeks. The published Tentative Budget must be accompanied by a notice of the scheduled date and time for a public hearing regarding the budget. ARS §42-17104 specifies that the Town Council shall hold a public hearing and special meeting at which any taxpayer may appear and speak for or against any proposed expenditure. This meeting is held on the date the budget is adopted. ARS §42-17105 prescribes that once the Tentative Budget has been published, expenditures may not be increased above the published amounts; however, they may be decreased. In effect, with the publication of the Tentative Budget, the Town Council has set its maximum limits for expenditures, but these limits may be reduced upon final adoption.

FINAL BUDGET ADOPTION State law (ARS §42-17105) specifies that after the hearing required by ARS §42-17104, the Town Council must adopt the estimate of proposed expenditures for the fiscal year at a special meeting called for that purpose. The adopted expenditures then become the budget for the upcoming fiscal year and shall not exceed the total amount proposed for expenditures in the published estimates (i.e., the Tentative Budget). According to ARS §42-17106, once adopted, no expenditures shall be made for a purpose not included in the budget and no expenditures shall be made in excess of the amounts specified for each purpose in the budget, except as provided by law. This restriction applies whether or not the Town has at any time received, or has on hand, funds or revenue in excess of those required to meet expenditures incurred under the budget.

BUDGET REVISIONS ARS ยง42-17106 requires that no expenditures be made for a purpose not included in the adopted budget in any fiscal year in excess of the amount specified for each purpose in the budget. ARS ยง42-17106 permits the Town Council, on the affirmation of a majority of the supervisors at a duly noticed public meeting, to authorize the transfer of funds between programs if the funds are available, if the transfer is in the public interest and based on a demonstrated need, so long as the transfer does not violate the set spending limitations.

Schedule A

4,448,310 4,448,310

0 0

1,190,000 3,360

0 0

3,258,310 0

0 0

0 1,749,950

0 2,695,000

D D

2018 Interfund Transfers In

2018 Interfund Transfers (Out)

0 0 0 0

2018 Other Financing (Uses)

** ***

$ $

2017 50,976,230 $ (1,169,980) 49,806,250 14,457,328 35,348,922 $ 35,348,923 $

Includes Expenditure/Expense Adjustments Approved in the current year from Schedule E. Includes actual amounts as of the date the proposed budget was prepared, adjusted for estimated activity for the remainder of the fiscal year. Amounts on this line represent Fund Balance/Net Position amounts except for amounts not in spendable form (e.g., prepaids and inventories) or legally or contractually required to be maintained intact (e.g., principal of a permanent fund).

2018 61,283,920 (8,877,750) 52,406,170 15,572,674 36,833,496 36,833,497

61,283,920 0 265,310 0 15,952,220 0

12,627,910

32,438,480

EXPENDITURE LIMITATION COMPARISON 1. Budgeted expenditures/expenses 2. Add/subtract: estimated net reconciling items 3. Budgeted expenditures/expenses adjusted for reconciling items 4. Less: estimated exclusions 5. Amount subject to the expenditure limitation 6. EEC expenditure limitation

61,283,920 0 265,310 0 15,952,220 0

12,627,910

32,438,480

The city/town does not levy property taxes and does not have special assessment districts for which property taxes are levied. Therefore, Schedule B has been omitted.

2018 Budgeted Expenditures/Expenses

2018 Total Financial Resources Available

LESS: Amounts for Future Debt Retirement:

7,648,000 0 0 0

328,000

7,320,000

2018 Other Financing Sources

2018 Reduction for Amounts Not Available:

30,855,150 0 4,018,060

5,585,250

5,227,400

16,024,440

562,370

2018 Estimated Revenues Other than Property Taxes

562,370

2018 Secondary Property Tax Levy

22,218,400

2018 Primary Property Tax Levy

(4,939,390)

1,268,090

19,109,040

6,780,660

29,505,230 0

4,690,150

6,735,790

3,704,550

14,374,740

2017 Actual Expenditures/Expenses**

2018 Fund Balance/Net Position at July 1***

50,976,230 0

1,682,770

14,428,570

Total All Funds

Internal Enterprise Funds Available Service Funds

4,626,400

Permanent Fund

30,238,490

Capital Projects Special Revenue Fund Debt Service Fund Fund

General Fund

FUNDS

2017 Adopted/Adjusted Budgeted Expenditures/Expenses*

Fiscal Year

S c h

TOWN OF SAHUARITA, ARIZONA Summary Schedule of Estimated Revenues and Expenditures/Expenses Fiscal Year 2018

TOWN OF SAHUARITA, ARIZONA Tax Levy and Tax Rate Information Fiscal Year 2018 2017 1. Maximum allowable primary property tax levy. A.R.S. §42-17051(A)

2. Amount received from primary property taxation in the current year in excess of the sum of that year's maximum allowable primary property tax levy. A.R.S. §42-17102(A)(18)

3. Property tax levy amounts A. Primary property taxes B. Secondary property taxes C. Total property tax levy amounts 4. Property taxes collected* A. Primary property taxes (1) Current year's levy (2) Prior years’ levies (3) Total primary property taxes B. Secondary property taxes (1) Current year's levy (2) Prior years’ levies (3) Total secondary property taxes C. Total property taxes collected

$ $

2018

$ 468,290 468,290

562,370 562,370

$ $ $ $ $

451,470 5,570 457,040 457,040

5. Property tax rates A. City/Town tax rate (1) Primary property tax rate (2) Secondary property tax rate (3) Total city/town tax rate Special assessment district tax rates B. Secondary property tax rates - As of the date the proposed budget was prepared, the city/town was operating two special assessment districts for which secondary property taxes are levied. For information pertaining to these special assessment districts and their tax rates, please contact the city/town. * Includes actual property taxes collected as of the date the proposed budget was prepared, plus estimated property tax collections for the remainder of the fiscal year. Schedule B

TOWN OF SAHUARITA, ARIZONA Revenues Other Than Property Taxes Fiscal Year 2018 ESTIMATED REVENUES 2017

SOURCE OF REVENUES

ACTUAL REVENUES* 2017

ESTIMATED REVENUES 2018

GENERAL FUND Local taxes Transaction privilege taxes Franchise fees

5,058,410 331,990

Licenses and permits Planning & Building permit fees Public Works permit fees Animal license fees Other

1,288,580

5,067,810 304,260

5,338,030 312,270

1,287,880 87,920 42,000 700

1,304,150

2,420,230 3,145,780 1,100,980

2,630,970 3,470,980 1,214,350

2,696,620 3,560,890 1,320,840

Charges for services Development fees Recreation fees Other departmental fees Indirect cost recovery

95,070 127,030 5,000 698,750

32,610 116,600 3,120 689,540

80,920 120,930 2,830 754,280

Fines and forfeits Court fines and fees

230,030

186,000

190,750

Interest on investments Investment earnings

233,930

202,640

239,780

45,000

25,000 19,800 20,730

25,000 21,600 19,750

42,000

Intergovernmental State shared sales taxes State shared income taxes State shared vehicle license taxes

Miscellaneous Insurance recoveries Leases Other

15,000 Total General Fund $

14,837,780

15,402,910

35,000 800

16,024,440

* Includes actual revenues recognized on the modified accrual or accrual basis as of the date the proposed budget was prepared, plus estimated revenues for the remainder of the fiscal year.

Schedule C (1 of 2)

SPECIAL REVENUE FUNDS Highway User Revenue Fund State shared fuel taxes Intergovernmental-State Intergovernmental-Local Investment earnings Miscellaneious Grants & Restricted Sources Fund Fines and forfeitures Intergovernmental-Federal Intergovernmental-State Intergovernmental-Local Impound fees Investment earnings Miscellaneous

1,848,970 $ 4,315,000 25,000 2,090

$ $

$ Quail Creek CFD Property taxes-allowance for uncollectibles Miscellaneous/Developer contributions

$ $

2,270,470 1,720,840 150,000 10,740

6,191,060 $

2,173,170 $ 3,788,770 32,300 5,050 4,200 6,003,490 $

160,870 $ 437,430 2,400 41,100 15,000 4,490 44,000 705,290 $

16,070 $ 277,130 32,000 56,330 15,000 3,690 36,740 436,960 $

87,870 323,540 60,550 32,450 15,000 3,060 32,500 554,970

(11,650) $ 506,410 494,760 $

(11,650) $ 540,520 528,870 $

(13,040) 195,220 182,180

Rancho Sahuarita CFD Investment earnings (losses) Miscellaneous/Developer contributions

4,152,050

250 $

5,410 5,410 $

338,200 338,200

Total Special Revenue Funds $

7,391,360 $

6,974,730 $

5,227,400

1,912,970 $

1,838,740 $ 1,200

2,306,000

CAPITAL PROJECTS FUNDS Capital Infrastructure Improvement Fund (CIIF) Transaction privilege taxes $ Permits Intergovernmental-Federal Intergovernmental-Local Investment earnings Miscellaneous $

873,750 311,840 73,360

Total Capital Projects Funds $ ENTERPRISE FUNDS Wastewater Fund Sewer user charges Long-term Storage Credits Other Sewer connection fees Intergovernmental-State Investment earnings (losses)

3,050,000

3,171,920 $

272,680 92,210 165,000 2,369,830 $

79,250 150,000 5,585,250

3,171,920 $

2,369,830 $

5,585,250

3,235,040 $

3,203,990 $ 103,020 82,150 146,770

3,329,920 136,220 74,650 546,880

22,500 165,680

(61,820) 3,361,400 $

(25,640) 3,510,290 $

(69,610) 4,018,060

Total Enterprise Funds $

3,361,400 $

3,510,290 $

4,018,060

TOTAL ALL FUNDS $

28,762,460 $

28,257,760 $

30,855,150

* Includes actual revenues recognized on the modified accrual or accrual basis as of the date the proposed budget was prepared, plus estimated revenues for the remainder of the fiscal year.

Schedule C (2 of 2)

TOWN OF SAHUARITA, ARIZONA Other Financing Sources/<Uses> and Interfund Transfers Fiscal Year 2018

FUND

OTHER FINANCING 2018 SOURCES <USES>

GENERAL FUND CIIF $ Wastewater Fund Total General Fund $ SPECIAL REVENUE FUNDS Highway User Revenue Fund: $ CIIF Rancho Sahuarita CFD Total Special Revenue Funds $ CAPITAL PROJECTS FUNDS CIIF $ General Fund Highway User Revenue Fund Wastewater Fund Total Capital Projects Funds $

1,505,000 1,190,000 2,695,000

1,749,950 7,320,000 7,320,000

328,000

ENTERPRISE FUNDS Wastewater Fund: $ General Fund CIIF Total Enterprise Funds $ TOTAL ALL FUNDS $

INTERFUND TRANSFERS 2018 IN <OUT>

1,749,950

$ 1,505,000 1,749,950 3,360 3,258,310

$ $

1,190,000

7,648,000

1,190,000

3,360 3,360

4,448,310

Schedule D

TOWN OF SAHUARITA, ARIZONA Expenditures/Expenses by Fund Fiscal Year 2018

FUND/DEPARTMENT

ADOPTED BUDGETED EXPENDITURES/ EXPENSES 2017

GENERAL FUND Mayor & Council $ Town Manager Law Town Clerk Finance Human Resources Planning & Building Parks & Recreation Public Works Police Municipal Court Non-Departmental Contingency/Ending Balances Total General Fund $ SPECIAL REVENUE FUNDS Highway User Revenue Fund Streets $ LTAF Contingency/Ending Balances Grants & Restricted Sources Fund Town Manager Parks & Recreation Police Streets Capital Outlay Contingency/Ending Balances Quail Creek CFD General government Streets Parks & Recreation Debt Service Rancho Sahuarita CFD General government Streets Debt Service Capital Outlay Contingency/Ending Balances Total Special Revenue Funds $

ACTUAL EXPENDITURES/ EXPENSES* 2017

BUDGETED EXPENDITURES/ EXPENSES 2018

113,860 753,180 643,730 579,470 1,395,530 268,680 1,239,460 1,732,900 965,270 6,299,670 592,360 251,350 15,403,030 30,238,490

125,420 750,700 639,180 508,510 1,362,790 248,470 1,239,530 1,661,170 938,520 6,110,720 556,030 233,700

14,374,740

137,550 786,280 698,420 578,880 1,423,180 279,940 1,312,040 1,897,330 1,008,570 7,026,530 602,080 154,420 16,533,260 32,438,480

2,174,450

2,076,850 410

2,804,080

4,280

389,100

21,000 15,000 802,730

18,240 10,000 475,590

10,500 15,000 760,380

438,960

246,100

4,700 20,390 12,770 1,127,890

2,100 14,900 20,800 1,075,160

3,570 16,510 27,330 656,280

1,160

1,300 9,200

1,840 15,600 922,950 6,758,670

3,070 4,626,400

3,704,550

12,627,910

1,105,840 330,000 3,421,170 200,920 1,677,860

6,735,790

5,274,360 333,100 2,564,140 1,841,000 1,609,820 4,329,800 15,952,220

1,574,230 $ 405,990 2,401,410 1,380,200 (4,079,060) 1,682,770 $ 50,976,230 $

1,528,580 391,500 2,431,070 339,000

$ $

4,690,150 29,505,230

$ $

CAPITAL PROJECTS FUNDS Capital Infrastructure Improvement Fund (CIIF) General Governement $ 2,319,220 Public Safety 330,000 Highways & Streets 5,387,500 Culture & Recreation 812,000 Debt Service 1,567,860 Contingency/Ending Balances 4,011,990 Total Capital Projects Funds $ 14,428,570 ENTERPRISE FUNDS Wastewater Fund Wastewater Operations $ Finance Debt Service Capital Outlay Ending Fund Deficits Total Enterprise Funds $ TOTAL ALL FUNDS $

EXPENDITURE/ EXPENSE ADJUSTMENTS APPROVED 2017

1,619,680 505,430 2,431,090 1,270,930 (5,561,820) 265,310 61,283,920

* Includes actual expenditures/expenses recognized on the modified accrual or accrual basis as of the date the proposed budget was prepared, plus estimated expenditures/expenses for the remainder of the fiscal year.

Schedule E

TOWN OF SAHUARITA, ARIZONA Expenditures/Expenses by Department Fiscal Year 2018

DEPARTMENT/FUND Town Manager General Fund $ Grants & Restricted Sources Department Total $

ADOPTED BUDGETED EXPENDITURES/ EXPENSES 2017

EXPENDITURE/ EXPENSE ADJUSTMENTS APPROVED 2017

ACTUAL EXPENDITURES/ EXPENSES* 2017 750,700 $ 18,240 768,940 $

786,280 10,500 796,780

1,362,790 $ 600 600 190,000 391,500 1,945,490 $

1,423,180 800 800 190,000 505,430 2,120,210

268,680 $ 18,000 286,680 $

248,470 $

279,940

248,470 $

279,940

1,239,460 $

1,239,530 $

1,239,460 $

1,239,530 $

1,312,040 45,000 1,357,040

Parks & Recreation General Fund $ Grants & Restricted Sources Quail Creek CFD CIIF Department Total $

1,732,900 $ 15,000 12,770 108,000 1,868,670 $

1,661,170 $ 10,000 20,800 87,920 1,779,890 $

1,897,330 15,000 27,330

Public Works General Fund $ CIIF Department Total $

965,270 $ 120,380 1,085,650 $

938,520 $ 118,250 1,056,770 $

1,008,570

Police General Fund $ Grants & Restricted Sources CIIF Department Total $

6,299,670 $ 802,730 330,000 7,432,400 $

6,110,720 $ 475,590 330,000 6,916,310 $

7,026,530 760,380 333,100 8,120,010

2,174,450 $ 20,390

2,076,550 $ 14,900 9,200 19,000 2,119,650 $

2,804,080 16,510 15,600 139,000 2,975,190

233,700 $ 1,500 700 300,000 535,900 $

154,420 2,770 1,040 270,000 428,230

Finance General Fund $ Quail Creek CFD Rancho Sahuarita CFD CIIF Wastewater Fund Department Total $ Human Resources General Fund $ CIIF Department Total $ Planning & Building General Fund $ CIIF Department Total $

Streets Highway User Revenue Fund $ Quail Creek CFD Rancho Sahuarita CFD CIIF Department Total $ Non-Departmental General Fund $ Quail Creek CFD Rancho Sahuarita CFD CIIF Department Total $

753,180 $ 21,000 774,180 $

1,395,530 $

760 200,000 405,990 2,002,280 $

BUDGETED EXPENDITURES/ EXPENSES 2018

19,000 2,213,840 $

251,350 $ 4,700 400 110,000 366,450 $

1,939,660

1,008,570

Schedule F

Schedule G 8.3 8.3 139.7

TOTAL ALL FUNDS

1.7 1.7

CAPITAL PROJECTS FUNDS Capital Infrastructure Improvement Fund Total Capital Projects Funds

ENTERPRISE FUNDS Wastewater Fund Total Enterprise Funds

0.5 9.5

$ $

9.0

120.2

SPECIAL REVENUE FUNDS Highway User Revenue Fund Quail Creek CFD Rancho Sahuartia CFD Grants and Restricted Sources Total Special Revenue Funds

GENERAL FUND

FUND

Full-Time Equivalent (FTE) 2018

9,834,730

490,770 490,770 $

$ $

220,810 789,730

129,160 129,160

568,920

8,425,070

Employee Salaries and Hourly Costs 2018

1,420,030

56,370 56,370 $

$ $

33,460 99,080

14,840 14,840

65,620

1,249,740

Retirement Costs 2018

1,600,190

90,890 90,890

23,930 23,930

113,500

1,371,870

Healthcare Costs 2018

TOWN OF SAHUARITA, ARIZONA Full-Time Employees and Personnel Compensation Fiscal Year 2018

$ $

987,420

51,400 51,400

$ $

21,270 94,920

11,690 11,690

73,650

829,410

Other Benefit Costs 2018

13,842,370

689,430 689,430

179,620 179,620

275,540 1,097,230

821,690

11,876,090

Total Estimated Personnel Compensation 2018

GLOSSARY Accrual Basis - A basis of accounting in which transactions are recognized at the time they are incurred, as opposed to when cash is received or spent. Adopted - As used in fund, summaries, department and program summaries within the budget, represents the budget as approved by the Town Council. Allocation -A part of a lump sum appropriation, which is designated for expenditure by specific organization units and/or for special purposes, activities, or objects. Appropriation - A legal authorization granted by Town Council to make expenditures and to incur obligations for specific purposes. An appropriation is usually limited in amount and duration when it may be expended. Assessed Valuation - A value that is established by the County Assessor for real and personal property to use as a basis for levying property taxes. Asset - Resources owned or held by a government, which have monetary value. Available (Undesignated) Fund Balance - Refers to the funds remaining from the prior year, which are available for appropriation and expenditure in the current year. Bonds - A written instrument to pay a sum of money at a specified interest rate, on a specific date or dates in the future, called maturity dates. The interest payments and the repayment of the principal are detailed in a bond resolution or ordinance. Two common types of bonds are general obligation and revenue bonds, which are most commonly used for construction of large capital projects such as buildings, streets, and sewers. The difference between a note and a bond is that a bond is used for a longer period of time and requires more formality. Bond Refinancing - The payoff and re-issuance of bonds, to obtain better interest rates and/or bond conditions. Budget - A plan of financial operation representing an estimate of proposed expenditures and the proposed means of financing them for a given period. This official public document reflects decisions, measures service needs, establishes the allocation of resources and is the pecuniary plan for achieving goals and objectives. Budget Calendar - The schedule of key dates or events, which the Town follows in the preparation, adoption, and administration of the budget. Budget Message - The opening section of the budget, which provides the Town Council and the public with a general summary of the most important budget issues, changes from recent fiscal years, and recommendations regarding the financial policy for the coming fiscal year. Budgetary Adjustment - A procedure to revise a budget appropriation either by Town Council approval, through the adoption of a supplemental appropriation ordinance for any interdepartmental or inter-fund adjustments, or by the Town Manager authorization to adjust appropriations within a departmental budget. Budgetary Basis - This refers to the form of accounting utilized throughout the budget process. These generally take one of three forms: GAAP, Cash, Modified Accrual, or some type of statutory form. Budgetary Control - The control or management of a governmental unit or enterprise in accordance with an approved budget for the purpose of keeping expenditures within the limitations of authorized appropriations and available revenues.

Capital Asset - Tangible assets costing $5,000 or more with a useful life of at least one year. Capital Budget - The appropriation of bonds or operating revenue for improvements to facilities and other infrastructure. Capital Improvements - Expenditures related to the acquisition, expansion, or rehabilitation of an element of the governmentâ&#x20AC;&#x2122;s physical plant; sometimes referred to as infrastructure. Capital Improvements Plan (CIP) - The CIP is a comprehensive plan of capital investment projects which identifies priorities as to need, method of financing, cost, and revenues that will result during a five year period. The program is a guide for identifying current and future fiscal year requirements and becomes the basis for determining the annual capital budget. Capital Outlay - Expenditures resulting in the acquisition or addition to the governmentâ&#x20AC;&#x2122;s capital assets. Cash Basis - A basis of accounting in which transactions are recognized only when cash is increased or decreased. Contingency - A budgetary reserve set aside for emergencies or unforeseen expenditures not otherwise budgeted. Contractual Services - Services rendered to the Town in the form on contractual, professional, maintenance, and vehicle maintenance services. This also includes expenses for rentals, dues and memberships that may be charged by employees. Cost Center - An organizational budget/operating unit within each Town department or program. COLA - Cost Of Living Adjustment Debt - An obligation resulting from borrowing money or from the purchase of goods and services. Types of governmental debt include bonds, loans, time warrants, and notes. Debt Service - The amount of interest and principal the Town must pay each year on net direct long-term debt plus the interest it must pay on direct short-term debt. Deficit - The excess of an entityâ&#x20AC;&#x2122;s liabilities over its assets or the excess of expenditures over revenues during a single accounting period. Department - A major administrative division of the Town, which indicates overall management responsibility for an operation or a group of related operations within a functional area. Depreciation - Consumption of the service life of fixed assets, due to normal wear, deterioration, environmental elements, passage of time, and obsolescence. The portion of the cost of a capital asset charged as an expense during a specified period based on service life of the asset and ultimately expending the entire cost of the asset. Distinguished Budget Presentation Awards Program - A voluntary awards program administered by the Government Finance Officer Association to encourage governments to prepare budget documents of the highest quality. Encumbrance - The legal commitment of appropriated funds to purchase an item or service. To encumber funds means to set aside or commit funds for a future expenditure. Estimated Revenue - The amount of projected revenue to be collected during the fiscal year.

Expenditure/Expense - Decreases in net financial resources in accordance with budgeted appropriations. Expenditures include operating expenses such as the acquisition of assets or goods and services. Expenditure Limitation - An amendment to the Arizona State Constitution, which limits annual expenditures of all municipalities. The limit is set by the Economic Estimates Commission based on population growth and inflation. All municipalities have the option of Home Rule where the voters approved a four-year expenditure limit based on revenues received. Fiscal Year - Time period designated by the Town signifying the beginning and ending period for recording financial transactions. The Town has a fiscal year beginning July 1 and ending June 30. Franchise Fee - A fee paid by public service business (i.e., utility) for the special privilege to use Town streets, alleys, and property in providing their services to the citizens of the community. Full Time Equivalent (FTE) - A part-time position converted to the decimal equivalent of a full-time position based on, 2088 hours per year, or a full value of one for a full-time position. Function -Activity, which is performed by one or more organizational units for the purposes of accomplishing a goal. Fund - An accounting entity having a set of self-balancing accounts and records all financial transactions for specific activities or government functions in attaining certain objectives governed by special regulations, restrictions, or limitation. Fund Balance - Fund Balance is the excess of resources over expenditures. The beginning fund balance represents the unused accumulation of resources from prior years (i.e., the previous yearâ&#x20AC;&#x2122;s ending fund balance). General Obligations Bonds - Bonds that finance a variety of public projects and require voter approval. These bonds are backed by full faith and credit of the Town. Limitations for bonding capacity are set by State Statute. Generally Accepted Accounting Principles (GAAP) -Uniform minimum standards for financial accounting and recording, encompassing the conventions, rules, and procedures that define accepted accounting principles. Goal - A long-term, attainable target for an organization - its vision of the future. Grant - Contributions or gifts of cash or other assets from another government to be used for a specified purpose, activity, or facility. Improvement Districts - Improvement Districts are formed consisting of property owners desiring improvements, primarily street reconstruction, to their property. Bonds are issued to finance these improvements, which are repaid by assessments on affected property owners. Indirect Cost - A cost necessary for the functioning of the organization as a whole, but which cannot be directly assigned, such as administrative support, facility maintenance, or custodial services. Interfund Transfer - The movement of monies between funds of the same governmental entity. Intergovernmental Revenue - Revenues from other governments in the form of grant, entitlements, shared revenues, or payments in lieu of taxes. Levy - To impose taxes for the support of government activities. Long Term Debt - Debt with a maturity of more than one year after the date of issuance.

Modified Accrual Basis - Under the modified accrual basis of accounting, recommended for use by governmental funds, revenues are recognized in the period in which they become available and measurable, and expenditures are recognized at the time a liability is incurred pursuant to appropriation authority. Objective - A specific measurable and observable result of an organizationâ&#x20AC;&#x2122;s activity, which advances the organization toward its goal. Operating Expenses - The cost of personnel, contractual services, supplies, and other costs required for a department to function. Operating Revenue - Funds that the government receives as income to pay for ongoing operations, including such items as taxes, user fees, interest earnings, and grant revenues. Operating revenues are used to pay for day-to-day services. Operating Supplies - Costs of goods consumed by the Town in the course of its daily operations. Operating Transfers - Legally authorized transfers from a fund receiving revenue to the fund through which the resources are to be expended. Pay-As-You-Go Financing - A term used to describe a financial policy by which the capital program is financed from current revenues rather than through borrowing. Performance Indicators - Measurable means of evaluating the effectiveness of a cost center in accomplishing its defined objectives. Personnel Services - Cost related to compensating employees, included wages, insurance, payroll taxes, retirement contributions, allowances for clothing, and automobiles, training, conferences, and travel to meetings. Policy - A plan, course of action, or guiding principle designed to set parameters for decisions and actions. Program - A group of homogenous cost centers within a department; a departmental division. Program Goal - The underlying reason(s) for a department/division to exist and/or the service provided. Property Tax Levy - The total amount to be raised by general property taxes for purposes specified in the Tax Levy Ordinance. In Arizona, the property tax system is divided into a primary and secondary rate. Reserve - An account used to indicate that a portion of a fundâ&#x20AC;&#x2122;s assets are legally restricted for a specific purposed and is, therefore, not available for general appropriation. Reserve/Contingency -A budgetary reserve set aside for emergencies or unforeseen expenditures not otherwise budgeted for. Resolution - A special or temporary order of a legislative body requiring less formality than an ordinance or statute. Resources -Total amounts available for appropriation including estimated revenues, fund transfers, and beginning balances. Revenue - Receipts from taxes, intergovernmental sources, and user fees or resources from voter-authorized bonds, system development fees, and grants. Risk Management - An organized attempt to protect a governmentâ&#x20AC;&#x2122;s assets against accidental loss in the most economical method.

Secondary Property Taxes - An unlimited tax levy restricted to general bonded debt obligations and for voter approved budget overrides. Source of Revenue - Revenues are classified according to their source or point of origin. Tax Levy - The resultant product when the tax rate per one hundred dollars is multiplied by the tax base. Taxes -Compulsory charges levied by a government for the purpose of financing services performed for the common benefit of the people. This term does not include specific charges made against particular persons or property for current or permanent benefit, such as special assessments. Transfers In/Out - Amounts transferred from one fund to another to assist in financing the services for the recipient fund. User Charges - The payment of a fee for direct receipt of a public service to the party who benefits from the service.

ACRONYMS AELR ADEQ ADOR ADOT AGA AOC ASRS CAFR CFD CIIF CIP COLA CSD CST FIAC FTE GAAP GADA GARS GASB GFOA GO GV HR HURF JCEF LGIP LTAF M&C NSCP PAG PC PD PSPRS PW QC CFD RICO RS CFD RTA SUSD TAC TPT UERS VIPS VLT WIFA WW WWTP

Annual Expenditure Limitation Report Arizona Department of Environmental Quality Arizona Department of Revenue Arizona Department of Transportation Association of Governmental Accountants Arizona Office of the Courts Arizona State Retirement System Comprehensive Annual Financial Report Community Facilities District Capital Infrastructure Improvement Fund Capital Improvement Plan Cost of Living Adjustment Continental School District Construction Sales Tax Finance and Investment Advisory Committee Full-Time Equivalent Generally Accepted Accounting Principles Greater Arizona Development Authority Grants and Restricted Sources (Fund) Government Accounting Standards Board Government Finance Officers Association General Obligation (Bonds) Green Valley Human Resources Highway User Revenue Fund Judicial Court Education Fund Local Government Investment Pool Local Transportation Assistance Fund Mayor & Council North Santa Cruz Park Pima Association of Governments Pima County Police Department Public Safety Personnel Retirement System Public Works Quail Creek Community Facilities District Racketeer Influenced & Corrupt Organizations Rancho Sahuarita Community Facilities District Regional Transportation Authority Sahuarita Unified School District Technical Advisory Committee Transaction Privilege Tax (Sales Tax) Uniform Expenditure Reporting System Volunteers in Police Service Vehicle License Tax Water Infrastructure Financing Authority of Arizona Wastewater Wastewater Treatment Plant