Tempe Budget Employee Forum
Nov. 4, 2009, at 5:30 a.m.
Public Works Field Services Assembly Hall

The following is a recap of questions asked and answers given during the second of three employee forums regarding the projected 2010-11 city budget deficit. All answers were provided by City Manager Charlie Meyer unless otherwise noted.

Q1: Is it possible to increase the primary property tax and achieve a better balance on the revenue side with sales tax?
A: Yes, but it would required an act of the state legislature. Arizona residents are generally not supportive of higher property taxes. It has historically been easy to rely on sales tax because so much of it was coming in due to construction activity in the state. Tempe residents might be supportive of the idea to increase property taxes but we have no control over the issue. However, there are other possibilities for increased revenue opportunities and the city’s results teams are looking at those ideas. We will give serious consideration to those revenue opportunities.

Q2: Is every city department going to be affected by the 2010-11 budget balancing plan?
A: Every department will make contributions to the solution. Sometimes community members and elected officials are of the opinion that public safety should not be cut, but our current reality is that there would be serious ramifications if we cut everything but public safety budgets. City services like water and solid waste cover their costs; for that reason, we do not expect to cut much in 2010-11 from those areas and we didn’t in 2009-10. Our budget conversations are all about services provided through the general fund, not about separate funds like solid waste.

Q3: Is there an average number or percentage of Police and Fire employees that a city should have and are we above that?

Answer from Charlie Meyer: In the case of the Police Department, there is not a set answer to that. Tempe has in the past looked at the number of police officers per capita to compare ourselves; one of our results teams is now evaluating that as well. One consideration for staffing levels is that we have Arizona State University here. In the case of the Fire Department, there are a couple ways to measure. One is firefighters per capita. There also is a national fire protection organization that recommends four staff members per engine, as well as recommended response times – both of which we try to achieve. A major national insurance organization establishes the bases for the insurance rates we all pay based on the level of fire protection in a community. That organization has told Tempe that, without our regionally shared “automatic aid” fire response system, our city would need 10 fire stations. Tempe currently has six.

Answer from Police Chief Tom Ryff: The Police Department is on board with the work that needs to be done to solve the city’s 2010-11 budget issues and will participate by cutting its budget. The department did so for 2009-10 as well, cutting $1 million from its budget.

Q4: When negotiating development agreements for properties that will involve city-provided tax incentives (such as Arizona Mills and Tempe Marketplace), is there a way for Tempe to negotiate requirements that the property owners use the city’s commercial solid waste services instead of going to private providers?
A: Our Economic Development staff members are here and hearing that idea. The Revenue Enhancement Results Team can consider that input. We have never heard that idea before. It could be a possible negotiation tool.

Q5: Since public safety is not designed to generate revenue, but they do collect revenue through fines, should we make people aware that it’s not set up to function as a revenue generator?

Answer from Charlie Meyer: We could collect lots of money in fines, but we don’t make the connection between public safety and revenue generation. That would be crossing an ethical line. We can do a good job of enforcing the law, but not for purposes of generating revenue because we would lose the confidence of the community. Whenever we generate more citations, such as with photo radar, it has an impact on our Municipal Court, which has the resulting increased workload from processing the violations.

Answer from Fire Chief Cliff Jones: The Fire Department charges inspection fees, which are down now. We get some revenue from ambulance service, but we’re engaged in education activities that result in fewer ambulance trips.

Q6: Are there communities that have a dedicated tax for public safety?
A: The City of Phoenix adopted a public safety sales tax and the ballot language said they would add personnel. As a result of the recession, it will be very difficult for them to comply with the ballot language, which would break a covenant with voters. If you adopt a dedicated tax, you must be prepared to fulfill those promises over the long term, otherwise you violate the trust of the community. In 2009-10, I proposed a one percent increase in the city’s bed tax. The Convention and Visitors Bureau and the City Council were ultimately not receptive to the concept at that time. This year, the CVB has floated the idea of a two percent increase in the bed tax, split between it and the city in order to continue tourism promotions. 

Q7: What is the status of the Centerpoint Condos?
A: Avenue Communities, the developers of the project, are in the process of trying to get the Courts to put the buildings up for auction. The principal on the project thinks he will be able to buy the buildings back. If it happens, he will probably rent them until the economy improves. That is probably the only way to get occupancy in those buildings for now. There is no timeline for when that might happen.

Q8: Does Tempe receive a subsidy from the state for providing public safety services related to ASU’s presence in the community?
A: The University of Arizona pays the City of Tucson for fire service to the university. Tempe has never had a similar arrangement with ASU. The city has a long list of items on its agenda to work out with ASU.