Budget Document Overview

This overview outlines the 2005-06
Annual Budget. Copies of the document
are available in the Phoenix Public Library
or by contacting the city of Phoenix Budget
and Research Department at 602-262-4805.
Also, this document can be made available
in alternate formats (large print, Braille,
audio cassette or computer diskette) upon
request. For information, contact the
Budget and Research Department or
city TTY relay at 602-534-5500.
The Summary Budget contains a
narrative description of Phoenix programs
and services planned for the upcoming
fiscal year. Also included is a narrative
description of all revenue sources and
a description of major financial policies.
The Detail Budget presents extensive
statistical data (including multiyear
comparisons) for each city department
and fund. The statistical data includes
staffing allocations and a detailed
reporting of planned expenditures.
Finally, the 2005-10 Capital
Improvement Program provides Phoenix’s
planned construction program by project
and detailed sources of funds.
A more detailed description of the
2005-06 Phoenix Summary Budget follows.

CITY MANAGER’S BUDGET MESSAGE
The City Manager’s Budget Message
provides an in-depth look at the city
manager’s priorities and outlook for the
upcoming fiscal year. These priorities
reflect many months of working with the
Mayor and City Council, the community
and city staff.

OUR COMMITMENT TO EXCELLENCE

DEPARTMENT PROGRAM SUMMARIES

This section provides an overview of the
city’s various programs that contribute
to our overall pursuit of excellence.
Included is a description of the national
and international recognition received
by Phoenix, results of the employee
suggestion program and winners of
employee excellence awards.

The Department Program Summaries
section provides total funding and
positions, program goals, major
performance measures and service
trends, and any changes in service for
each city department. Also included in
this section is a discussion of the city’s
debt management policies and the
contingency fund.

COMMUNITY PROFILE AND TRENDS
This section includes key demographic,
financial and infrastructure profile
measures. Estimates or projections
are provided for 2004-05 and 2005-06
as well as actual results for recent
and historical periods.

CAPITAL IMPROVEMENT PROGRAM
This section provides a description of
the capital improvement program process
and an overview of the 2005-10 Capital
Improvement Program.

SCHEDULES
2005-06 BUDGET OVERVIEW
The Budget Overview provides a
description of the city’s budget process
as well as the major assumptions included
in the preparation of the 2005-06 budget.
This section includes a broad overview of
the resources and expenditures included
in the budget. Also included is a historical
look at Phoenix’s community services, an
overview of significant budgetary and
financial policies including general legal
requirements and basis of accounting,
and descriptions of city funds.

The schedules provide a general statistical
overview of the budget. Schedule I
provides estimated beginning and ending
balances for each major fund group.
The remaining schedules summarize
staffing complements and estimated
resources and expenditures. For a more
detailed understanding of the city’s
budget, the Detail Budget should be
used. As noted above, copies of the
budget documents, including the Detail
Budget, are available in the Phoenix Public
Library or can be obtained by contacting
the Budget and Research Department.

2005-06 REVENUE OVERVIEW
This section provides an extensive
narrative describing the city’s revenue
estimates. The section is divided into
three categories: general funds, special
revenue funds and enterprise funds.

GLOSSARY
Definitions of the terms used throughout
the budget document are presented in
the glossary. If you have questions, need
further clarification of a concept or term,
or desire more detailed information about
something in this document, please
contact the Budget and Research
Department at 602-262-4805.

1

Distinguished Budget Presentation Award

T

he Government Finance Officers
Association of the United States
and Canada (GFOA) presented a
Distinguished Budget Presentation
Award to the city of Phoenix, Arizona
for its annual budget for the fiscal year
beginning July 1, 2004.
In order to receive this award, a
governmental unit must publish a budget
document that meets program criteria
as a policy document, as an operations
guide, as a financial plan 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.

3

Proposed 2005-06 Annual Budget

Community Budget Hearings
This budget transmittal includes an
explanation of the resources available
to fund next year’s budget and of the
community service changes that will
occur in the upcoming fiscal year. First,
however, I want to thank the hundreds of
residents who took the time to discuss the
budget with us during 15 budget hearings
and who sent us e-mail and voice mail
comments. Community budget hearings
were held throughout the community
and at various times of the day including
hearings targeted for seniors and youth.
New this year was a small business
hearing hosted by the Greater Phoenix
Chamber of Commerce.

TO THE HONORABLE MAYOR
AND CITY COUNCIL:
This letter transmits a balanced budget
for all city funds for the upcoming 2005-06
fiscal year. On April 5, 2005, the Mayor
and City Council approved $15.4 million in
General Fund budget reductions including
93 city positions. In addition, reductions
to the Housing budget of $5.1 million and
88 city positions were approved. Finally,
$2 million in federal and state grants will
expire in October 2005. This budget
includes replacement funding for only
a portion of these grants.
This is the fourth consecutive year
of cuts in the General Fund budget.
Over the course of four years, General
Fund expenditures have been reduced
by $117 million.
Wherever possible, rather than waiting
until July 1, the start of our fiscal year,
General Fund budget reductions will be
implemented on May 23, 2005.

General Fund Budget Shortfall
During our first budget briefing of
Feb. 1, 2005, we reported a General Fund
deficit of $68.7 million. That is, we
reported that we were $68.7 million short
of having the funds necessary to continue
next year everything our General Fund
departments were currently delivering
to the community. While we expected
General Fund revenues to grow by
8 percent, due mostly to much improved
growth in state-shared revenues, the cost
side of the budget was experiencing
growth of nearly 15 percent. This
expenditure growth is most easily
understood by examining four categories.
First, inflationary cost increases
contributed about 8 percent. These
inflationary increases include employee
compensation agreed to in the second year
of a two-year agreement negotiated with
our employee unions covering wages,
health and dental insurance; and pension
increases. Inflationary increases also have

occurred in other non-employee line
items: fuel, utilities and our investment
in technology. Our next big category, about
3.7 percent, is the expanding need for
existing city service levels. This category
includes numerous cost items related to
preserving current city service levels and it
is largely made up of new capital facilities
to extend services to developing areas of
the city. Other service preservation items
include the recent funding for Westside
revitalization, improved library Internet
safety, dust control measures along the
Salt River and a community prosecutor.
The third category, contributing
1.9 percent, is providing for full staffing,
especially for the Police Department.
The Police Department has worked very
hard to reduce the average number of
police officer vacancies from more than
100 to about 25. This means greater patrol
capacity but, there is a cost. Finally, we
have a shortfall in revenue this year,
which must be made up. These shortfalls
contributed about 1.3 percent.
During our February briefing, the
Mayor and City Council approved $35
million in actions to immediately improve
our financial position. These actions
reduced the deficit to $33.7 million:
■

■

$10 million in already available leasepurchase proceeds were applied to
planned equipment purchases.
$20 million in available Arizona
Highway User Revenue (AHUR) Funds
were transferred from the Streets
capital budget to the Street
Transportation Department’s operating
budget, freeing up General Funds.
AHUR revenues have improved
significantly over the past 18 months
so, while this increase will reduce
future flexibility in the Streets
construction program, no current
projects will be affected.

5

■

The primary portion of the property
tax levy (used for paying General Fund
operating expenses) was increased by
$5 million. The secondary portion of
the property tax levy (used for repaying
general obligation bonds) was reduced
by a like amount leaving the combined
property tax rate at $1.82. The
offsetting reduction in the secondary
levy will have no impact on the
financial health of the current
bond program.

Then, during the months of February
and March, we continued to work to
further reduce the deficit to $15.4 million:
■

■

■

■

We reviewed, once again, all estimated
General Fund spending for this year
and next and made line-item budget
cuts amounting to $3.1 million.
Based on General Fund revenues for
the month of January, most notably
strong growth in city and state-shared
sales taxes, we increased our estimated
revenues by $1.6 million.
By reviewing, once again, the latest
available construction timelines, we
reduced the costs associated with
opening new capital facilities by
$3.8 million.
We recommended transferring
$9.8 million in costs associated with
the public safety early hiring plan to
the revenue generated by franchise
agreements approved by the voters
on March 8.

General Fund Budget Reductions
As noted earlier, $15.4 million in General
Fund reductions, including the elimination
of 93 positions were necessary. No public
safety services have been cut; however,
many other community services have been
reduced. These reductions include the
deferred opening of the new Cesar Chavez
Regional Library; a reduction in available
blighted property abatement funding;

6

reduced general recreation programming
and the closure of city pools one week
early. In addition, 12 late-night transit
routes will be eliminated and alley dust
proofing and the Streets micro-seal
program will be reduced. This document
details the necessary changes being made
to each General Fund department.
We regret each reduction in community
services and look forward to working
together to restore these service levels
as quickly as our resources will allow.

New Capital Facilities
Balancing this General Fund budget
required us to provide $2.1 million in
funding for several new capital facilities
to provide services to underserved areas
of the city. These new facilities, funded
by the 2001 bond program and the Parks
and Preserve Initiative, include three new
senior centers, six new or improved parks,
and a twin-engine helicopter to be shared
by Police and Fire. A detailed description
of each of these new facilities is detailed
in this document.

Impact of Federal and State Grants
Finally, balancing the General Fund
budget required us to evaluate $2 million
in various expiring federal and state
grants. In balancing the budget, we have
allocated $1 million in General Funds to
replace several criminal justice grants.
Programs funded by the remaining
$1 million including truancy and young
first offender casework services, outdoor
recreation opportunities for teens and
adults with disabilities, and victim’s
advocacy services will end on Sept. 30,
2005, the end of the grant period.
Staff is working to try to identify other
potential funding sources for programs
including private donations.

Limited Federal Housing Funding
The city’s Housing Department, which
receives its funding from the federal
government, excels at providing safe,
clean, affordable housing programs and
services to help Phoenix residents achieve
self-sufficiency. Recently, available federal
funding has remained flat and not kept up
with the demand for our housing services
and the additional costs necessary to run
the program. As a result, we are facing an
annual budget shortfall in the Section 8
and public housing programs.
More than 5,000 families in Section 8
and 2,300 families in public housing
receive daily assistance. To avoid cuts for
as long as possible, we’ve relied on funding
reserves for the past two years. If we do
nothing, these drawdowns will escalate. If
we take action now, we avoid more drastic
cuts in the future. This budget reduces
the annual Housing Department budget
by $5.1 million, including 88 positions.
We have focused, to the extent possible,
on reducing administrative costs and
consolidating services in order to direct
as much funding as possible to resident
services. However, maintenance and
tenant services will be reduced. But,
the number of housing units we provide
to the community will not be reduced.

Other Non-General Funds
This budget includes budget additions
for the Aviation, Water, Wastewater, Solid
Waste and Civic Plaza departments to
open new facilities and respond to growing
workloads. Development Services
additions are included to improve
customer service as workload levels
continue to increase. Finally, some route
improvements are included in Transit 2000
funds as well as an increase in Dial-A-Ride
services. Dial-A-Ride improvements are
funded with an offsetting reduction in
other transit miles.

Other Budget Adjustments

Looking Ahead

For many years, city departments have
been provided the opportunity to look for
cost efficiencies that could be reallocated
to community service improvements or
needed administrative support. With
the cost cutting of the past several years,
these reallocations are becoming more and
more difficult to identify. But, this year,
departments were still able to identify
some savings. Some of these savings have
been used to improve services including
an additional operator for reserve-a-ride
services and operations assistants to
improve curb security at Sky Harbor’s
terminals. Other changes include
improved benefit coordination for police
officers and improved controls in the
Finance Department’s procurement of
citywide professional services. A more
detailed description of these changes is
provided in this document.

Over the past four years, Phoenix has
faced some serious budget challenges
and responded with budget cuts of
$117 million. These cuts have resulted
in the loss of important services to the
community. There are still some financial
challenges ahead.
We will soon begin the 2005 census
count. This count will show that, while
Phoenix continues to grow, we do not grow
as fast as our surrounding communities.
Our share of the state’s population will
decline. Since state-shared revenues are
distributed on the basis of our share of
the state’s population, in 2006-07, our
state-shared revenue distribution will
decline by an estimated $22 million.
On the bright side, the local economy
is improving and will continue to do so.
We will soon embark on the community
process used since the 1950s to put
together a new bond program. A 200 to
300-member citizen committee will work
to place a new bond program on the ballot
in 2006. This bond program will bring city
services to areas of the community where
services are now lacking. However, we will
ask this committee to carefully deliberate
and control the impact of new facilities
on our operating budget.
Construction of a major addition to
the Civic Plaza is well underway and two
new major hotels are planned as well.
The expansion of the Civic Plaza and the
addition of hotel rooms have long been
identified as a missing piece of revitalizing
our downtown core. The impact of
bringing larger conventions to Phoenix
will be felt statewide. Also, construction
of the first segment of light rail service
is well underway and our full funding
agreement was executed with federal
authorities this year.
We recently celebrated the opening
of the Translational Genomics Research
Institute. The researchers and scientists
housed in this new state-of-the-art facility
in downtown Phoenix are working to
change the future of medicine by
searching for applications of the human
genome project.

Public Safety Service Enhancements
On April 20, after our budget deliberations
were complete, the Mayor and City Council
approved an increase in public safety
staffing. This increase was possible due
to $16 million in annual revenue that will
be generated, beginning May 1, 2005, by
new franchise agreements between the city
and Arizona Public Service and Southwest
Gas. While these new agreements were
approved by the voters on March 8, it has
taken the Police and Fire departments
time to evaluate and recommend their
highest priority public safety
enhancements. 199 new public safety
positions were approved for new heavy
rescue units, improvements to crime
suppression efforts, expanded community
policing and better homeland defense
capabilities. The budget presented here
includes this new public safety funding.

We are working with Arizona State
University to relocate about 10,000
students from the Tempe campus to new
classroom space downtown. We also are
working with Arizona State University
and the University of Arizona to locate a
medical school downtown. The addition
of a medical school will improve the
availability of health care for all of Arizona.
In summary, a look into the future,
as always, brings both the positive and
the negative. But, we see many more
positives than we see negatives.

Conclusion
My thanks to the Mayor and City Council
for their leadership and guidance in
balancing the city budget. I also want
to thank all city departments for
carefully preparing budget reductions
for consideration. Our departments have
worked hard to minimize the impacts of
budget reductions on the community.
Finally, I want to thank all city
employees for their dedication to the
Phoenix community. This budget, once
again, reduces the employee resources
available to deliver city services. But,
we are committed to finding a place for
each affected employee somewhere in
our organization. Everyday, our employees
deliver the best in services to the
community.

Sincerely,

Frank Fairbanks
City Manager
May 3, 2005

7

NATIONAL BLACK
CAUCUS OF LOCAL
ELECTED OFFICIALS

2005 City Cultural Diversity Award

The city of Phoenix was presented the 2005 City Cultural Diversity Award by the
National League of Cities - National Black Caucus of Local Elected Officials
(NBC-LEO) for its annual International Women's Day Work Team. Pictured from
left, Sydney Blaine, LaVina Horne, Carole Coles Henry, Terri Jackson, Pauline
Sandell, Amy Mancusco, Alexandra Jones, Diana Storino, Sheryl Sculley and
Natlie Sayer.

8

Phoenix’s Commitment to Excellence

We continue our pursuit of excellence.
All employees practice continuous
improvement as part of their daily
business. Customer service is our most
important focus, whether those customers
are residents seeking information and
assistance, companies looking to relocate
to Phoenix, neighborhoods working to
improve their areas, or city departments
receiving internal services.
Phoenix employees work as individuals
and on teams to deliver better services
with fewer dollars. They use numerous
innovative ways to improve service delivery
without increasing costs while working
with the community as a partner to make
Phoenix a better place to live, work and
play. Phoenix employees are proud to be
among the very best in service delivery,
and they serve the community with pride.
In 2004, to measure how effective
we are at meeting the needs of the
community, Phoenix conducted its tenth
Community Attitude Survey. This survey,
which is completed every other year,
showed that nine out of ten residents –
91 percent – were satisfied with the city’s
efforts in delivering 29 specific municipal
services. This rating represents the
highest service delivery rating recorded to
date and is particularly impressive given
the budgetary challenges the city has
faced over the past several years.

In addition to being recognized by the
community for a job well done, the city
and its employees continue to be
recognized by professional organizations
and external evaluators for their hard
work and dedication to safety and
customer service. The following is a
summary of just a few of the awards and
recognitions received by the city and its
staff during the course of the fiscal year:

■

■

■

■

■

City Manager Frank Fairbanks was
presented with the National Public
Service Award, the highest public
service award given for distinction in
public service by the American Society
for Public Administration and the
National Academy of Public
Administration. Mr. Fairbanks was
recognized for his work in developing
e-government, achieving an AAA excise
tax revenue bond rating from Standard
and Poors and his membership on local
business and community boards.
Phoenix Channel 11 was nominated
for six National Association of
Telecommunications Officers and
Advisors Television Awards.
Phoenix 11 received nominations
in the “community event coverage,”
“profile of a city department,”
“community awareness,” “special
audience,” and “municipal channel
promotion” categories.
Know99 Television, the city’s youth
and education channel, received 13
Telly Awards, which honor outstanding
local, regional and cable TV
commercials and programs.

■

■

■

The Public Information Office received
three Copper Anvil Awards from the
Public Relations Society of America.
David Ramirez and Marisol Russell
were honored for the phoenix.gov
Spanish language Web site and
Cynthia Weaver was honored for the
Development Services annual report,
which she helped write.
The Maricopa Association of
Governments (MAG) recognized the
city with a MAG Livable Communities
Award. The award was given in
recognition of the commercial
revitalization project along Seventh
Avenue between Camelback and
Indian School roads.
The Phoenix Municipal Stadium
renovation project received the Facility
of Merit Award from Athletic Business
Magazine. The stadium was praised
for its “balance of modern amenities
and timeless qualities.”
Neighborhood Services earned the
Platinum Award from MarCom Creative
Awards for its innovative efforts to
market the Graffiti Busters Program
through Domino’s Pizza.
The city of Phoenix also earned top
honors in Valley Forward’s 2004
Environmental Report Card. Phoenix
was the first city to win straight A’s for
outstanding achievement in all five
categories – land use, open space and
recreation, transportation, air quality
and water quality.

9

We are Committed to
Making Phoenix Better
The city’s Vision and Values continue to
serve as a common source of pride and
motivation for city of Phoenix employees
to do all that they can to make
Phoenix better.
■

The following are a few examples of
how city employees have demonstrated
their commitment to our Visions and
Values by going above and beyond to
improve the quality of life for Phoenix
residents.
■

We are dedicated to serving
our customers

■

We value and respect diversity

■

We work as a team

■

We each do all we can

■

We learn, change and improve

■

We focus on results

■

We work with integrity

■

We make Phoenix better!

■

This year Phoenix employees donated
$1.3 million through the annual
Community Service Fund Drive, which
represents a 10 percent increase over
the previous year.
City employees were among more than
500 volunteers who participated in a
recent cleanup along 51st Avenue,
between Camelback and Indian School
roads. Neighborhood Services
coordinated the effort, partnering with
the District 5 Council Office, Maryvale
U.N.I.T.E., Public Works, Street
Transportation, Fire and Police.

More than 34 properties in the area
received paint, landscaping or a
general cleanup.
■

■

■

In 2004, the Phoenix Youth and
Education Commission and the Human
Relations Commission awarded $60,000
in grants to local schools through the
Youth Diversity Grants Initiative.
The Office of Arts and Culture awarded
105 grants totaling $989,000 to 82
cultural organizations and schools for
their Phoenix-based arts programs
and activities. The grants support
programs and activities that serve more
than 1.5 million residents annually.
In November 2004, the City Council
approved spending $1.1 million to
increase the level of various services to
the city’s westside. An intense study of
the area showed that while the
westside receives about the same level

a ke in
fu ll -t im e st
n t w it h a
ta
P ru d en ce ,
is
ss
of
a
se
ix . B ec a u
im e li br a ry
n
-t
oe
rt
h
a ce in
a
P
p
n
a
e is
si te d a rt sp
d ow n to w
C ro ss w h it
th e m os t vi
su cc ee d in
is
d
y
n
P ru d en ce
a
er
ll
ve
a
ri
G
en tr a l
e a rt s th
ra ry ’s @ C
h el p in g th
C en tr a l L ib
rr
a
B
on
B u rt
P h oe n ix .
d ow n to w n

10

of municipal services as other parts of
the city, there were deficiencies in
some areas. The funds were used to
pay for 13 new employees and improve
the city’s ability to address a wide
range of issues, including neighborhood
code enforcement, traffic problems,
building construction complaints
and illegal dumping of trash.
■

In February 2005, the city held its third
annual diversity celebration for city
employees. The Diversity Celebration
helps create a vision where all people’s
rights are respected and where every
person can live and work as a valued
member of the community. The event
not only endorses and promotes the
city’s Vision and Value statement “We
value and respect diversity” by working
together and serving our community;
we show how we live it.

City of Phoenix Excellence Awards

tirelessly with residents, community
partners, other city departments and
the property owners themselves to
clean up the lots, which were not only
eyesores but provided cover for drug
activities. Mario even impressed some
of the cited property owners, who
thanked him for his professionalism
and suggestions for keeping their
lots clean.

Each year, the city of Phoenix recognizes
individual employees and teams of
employees with excellence awards for
outstanding service. This past year,
individual employees and employee teams
exemplified pride in public service.
■

Mario Rey Lopez, a Neighborhood
Services Department inspector, helped
revitalize the Palomino Neighborhood
in northeast Phoenix. A major problem
for that neighborhood was the
proliferation of weed-infested vacant
lots that were used as dumping grounds
for old mattresses, broken furniture,
trash and other debris. Most of the 50
lots targeted for cleanup enforcement
and compliance were owned by
individuals out of state, adding to the
city’s challenge. Mario worked

■

James Anderson of the Public Works
Department has saved the city – and
taxpayers – hundreds of thousands of
dollars over the years with his
knowledge of tires. Anderson has
spent untold hours researching tires
and the tire industry and is considered
a national expert on the subject.
Knowing that proper inflation can
extend the life of a tire, James was
instrumental in purchasing and

M a ri o R ey
L op ez is a
N ei gh bo rh
th e P a lo m
oo d Se rv ic
in o N ei gh
es D ep a rt m
bo rh oo d in
d il ig en tl y
en t in sp ec
n or th P h oe
to im p ro ve
to r a ss ig n
n ix . O ve r
th e co m m
ed to
th e p a st y
u n it y by ta
ea r, h e h a
rg et in g bl
s w or ke d
ig h t a n d n
eg le ct .

11

installing tire-inflation stickers for
Public Works’ sizable fleet. He also
recommended that the department use
quality recapped tires as much as
possible, resulting in significant savings
for Public Works and other city
departments. He is eager to share his
expertise and frequently conducts
“tire-wise” training for other city
departments, Valley municipalities
and the business community.
■

Sheila Denney, a Water Services
Department safety analyst, goes beyond
her normal job duties to increase
awareness of women in non-traditional
roles and promote diversity within her
large department. Sheila chairs the
department’s Women’s Innovative
Network (WIN), which has established

Road to Success, Secret Sisters and Job
Discovery. Women in Water Services
look to these three programs to
network, solve mutual problems and
achieve personal goals. Denney also
helped create the department’s
Diversity Task Force, which promotes
unity among Water Services’ more than
1,500 employees. Because of Sheila’s
efforts, the task force was able to
award a scholarship to a Gateway
Community College student enrolled in
the Water and Industrial Wastewater
Treatment Technology Program.
■

Library Assistant Prudence Crosswhite
is a primary reason the arts are thriving
in downtown Phoenix. Prudence is
curator of Burton Barr Library’s
@Central Gallery, downtown’s

most-visited art space. Her First Friday
opening receptions typically attract 400
art aficionados for a lively evening of
art, live entertainment and thoughtful
conversation with local artists and
musicians. She welcomes all artists to
the library gallery, regardless of
experience or reputation. Some of the
emerging artists selected for exhibits
no doubt would have difficulty
convincing sales-oriented commercial
art venues to show their works. She
also has had considerable success
attracting top-tier artists for the
gallery’s First Monday’s series. Because
of her dedication, thousands of Valley
residents are exposed to art in a setting
where they feel comfortable
and welcome.

s to
en t, st ri ve
es D ep a rt m
ty
ic
si
rv
er
Se
iv
r
d
te
p ro m ot es
it h th e Wa
w om en
l ro le s a n d
a n a ly st w
p
a
el
n
ty
h
io
fe
t
it
a
sa
d
th
a
ra
n ey,
ro gr a m s
in n on -t
Sh ei la D en
of w om en
to cr ea te p
n d a ch ie ve
w a re n es s
d th e ef fo rt
a
ob st a cl es a
l
le
a
e
n
Sh
so
in cr ea se a
er
t.
p
en
e
m
m
rt
co
a
d ep
s, ov er
w it h in h er
a l p ro bl em
so lv e m u tu
em p lo y ee s
ow th .
p er so n a l gr

12

■

Thanks to an employee team from
the Human Services Department,
thousands of low-income families took
advantage of the Earned Income Tax
Credit (EITC), reaping previously
unclaimed tax refunds. When the
department discovered in 2003 that as
much as $64 million in potential EITC
refunds had not been claimed by
Phoenix residents, it spearheaded a
campaign to assist families who would
qualify for the program. The EITC
Campaign Team coordinated the efforts
of a coalition consisting of more than
40 private and public agencies, the
Internal Revenue Service, the
Governor’s Office, major utility
companies and almost 200 volunteers.
The team oversaw the training of
tax preparation volunteers, arranged
for tax preparation sites and heavily

promoted the EITC campaign among
its target group. The result: 6,353
low-income families last year received
free tax preparation at nine
campaign-sponsored sites, resulting
in $6.2 million in much-needed
tax refunds.
■

Employee teams from the Parks and
Recreation Department have enriched
a central city community by providing
a safe, cultural haven at Eastlake Park,
located at 16th and Jefferson streets.
The park’s community center houses a
cultural and dance program that
attracts participants from throughout
the Valley. People of all ages flock to
the center to learn hip-hop, ballet, tap,
jazz, and African and Brazilian dance.
The park’s sports and recreation staff,
meanwhile, annually organizes a
number of community programs,

including a back-to-school event and a
Thanksgiving Day celebration. During
last year’s back-to-school event, more
than 400 youths received backpacks,
school supplies and clothing. The
holiday event attracted more than 600
individuals, who enjoyed a traditional
turkey dinner and gospel music.
■

Phoenix Police Officers Nick Margiotta
and David Beauchamp last year
launched the Connection to Care
Program, an alternative to “sweeps”
of homeless people that usually result
in arrests for nuisance activities.
Instead of charging and jailing the
homeless who are picked up during
sweeps, the officers - with the help of
other agencies - offer them a diversion
program. Offenders are taken to a
command post where they undergo a
brief assessment after being fed and

T h e E a rn ed
In
fr ee ta x p re co m e Ta x C re d it te a
m h el p ed
p a ra ti on ,
m or e th a n
ga rn er in g
6, 00 0 fa m
$6 .2 m il li on
il ie s re ce iv
in ta x re fu
e
n d s.

13

clothed. As a result of the assessment,
homeless men and women who would
have ended up spending yet another
night in jail receive immediate shelter,
detox treatment, mental-health
assistance and other services. The
results have been impressive: of 130
homeless individuals helped through
Connection to Care, 32 entered
substance abuse treatment programs,
five entered transitional housing,
six are employed and 14 obtained
permanent supported housing.
■

Phoenix is at the center of the
genomics and biotech revolution.
Were it not for two interdepartmental
teams working together, the city would
not be in such an enviable position.
The teams coordinated the design and

construction of TGen headquarters,
the impressive six-story building at
Fifth and Van Buren streets that houses
the Translational Genomics Research
Institute. After TGen decided to
relocate to Phoenix in mid-2002, the
city had 18 months to design and
construct the $46 million project.
To meet that deadline without
exceeding budget, the teams adopted
a “one-stop shop” approach to design
and construction while ensuring they
were creating a facility that would
allow for future growth and evolving
scientific needs. The city teams are
gratified that their efforts are helping
TGen as it pursues cures for cancer,
Alzheimer's disease and other
genetic disorders.

Our mission at the city of Phoenix
is to provide excellent customer service.
Although we have faced some challenging
budget times over the past several years,
all employees have continued to deliver
quality services to our community
and strive to make Phoenix better in
everything we do.
Phoenix has become one of the
best-run cities in the world because our
employees are leaders in their professions
with commitment, passion and a strong
work ethic. Each day, the core values
of our organization – what we call our
“Vision and Values” – are at the root
of everything we do.

a m m in g
ti ve p ro gr
it s in n ov a
r
fo
re n gt h en
st
n
d
ow
te r is kn
te re st s a n
en
in
C
y
ew
it
n
n
te
u
a
om m
ts , cu lt iv
ke P a rk C
th ei r ta le n
T h e E a st la
n ex p lo re
ca
ts
en
d
w h er e re si
rh oo d .
th e n ei gh bo

14

PHOENIX GROWTH

Population figures are from
the Census and the area is
from the City Clerk.

16

CITY OF PHOENIX
PLANNING DEPARTMENT

Community Profile and Trends

P

hoenix is the fifth most populous city
in the United States, the state capital
of Arizona, and the center of the
metropolitan area encompassed by
Maricopa County. This metropolitan area
also includes the cities of Mesa, Glendale,
Tempe, Scottsdale, Chandler, Peoria,
Gilbert, Goodyear, Tolleson, El Mirage and
Avondale as well as all unincorporated
areas of the county. It is situated 1,117
feet above sea level in the semi-arid Salt
River Valley. The area is widely known for
its mild, sunny winters and hot summers
and receives average rainfall of 6.74 inches
a year. Phoenix was founded in 1870 as an
agricultural community, and in 1881 was
incorporated as a city. The City Charter
under which it is presently governed was
adopted in 1913 and has been amended
from time to time since then. The charter
allows Phoenix to determine its

governmental structure and levy revenue
and sales taxes. A council-manager form
of government also was adopted in 1913.
Under this organizational structure, the
Mayor and Council appoint a city manager
to act as the chief operating officer.
The City Council sets policy direction
and the city manager is responsible for
implementing those policies in an efficient
and effective manner. In 1982, a group
of residents initiated an effort to move
to a district system for electing council
members. These residents were concerned
that at-large elections resulted in an
organization that was less responsive to
neighborhoods. The initiative was passed
by the voters of Phoenix, and the number
of Council seats was increased from six to
eight. The Mayor continued to be elected
at-large. The city has grown steadily,
especially since 1950. The 1900 census
recorded Phoenix population at 5,544.

In 1950, the city occupied 17 square
miles with a population of almost 107,000,
ranking it 99th among American cities.
The 2000 census recorded Phoenix
population at 1,321,045. As of July 1, 2005,
the city is projected to encompass 516
square miles, with the projected April 2005
population at 1,499,576. Major employers
of the Phoenix metropolitan area include
the State of Arizona, Wal-Mart Stores, Inc.,
Banner Health Systems, Maricopa County,
City of Phoenix, Honeywell International,
Inc., United States Postal Service,
Raytheon Co., Arizona State University,
Albertson’s-Osco and Intel Corp. The top
5 percent of property taxes based on
secondary assessed valuation, are paid
by Arizona Public Service Company and
Qwest Communications. The following
statistics are presented to provide a
“snapshot” of Phoenix residents, the city’s
financial condition and infrastructure.

1970-71

1980-81

1990-91

2000-01

Actual
2003-04

Estimated
2004-05

Projected
2005-06

Population 1
584,303
Percent of Population by Age
Under 5
8.8
5-19
29.9
20-44
32.2
45-64
20.4
65+
8.7
Percent of Population by Race 2
Not Hispanic or Latino (of Any Race)
N/A
Caucasian
93.3
Black/African American
4.8
American Indian/Alaska Native
1.0
0.5
Asian
Native Hawaiian/
N/A
Other Pacific Islander 3
0.4
Other
N/A
Not Hispanic - Two or More Races
Hispanic/Latino (of Any Race) 4
N/A

789,704

995,896

1,350,435

1,387,670

1,416,055

1,499,576

7.8
25.0
39.3
18.6
9.3

8.5
21.6
42.9
17.3
9.7

8.5
21.5
42.8
17.3
9.8

9.9
23.4
43.0
16.1
7.6

9.9
23.4
43.0
16.1
7.6

9.9
23.4
43.0
16.1
7.6

N/A
78.1
4.7
1.1
0.9

N/A
71.9
4.9
1.6
1.5

N/A
55.8
4.8
1.6
1.9

65.9
55.8
4.8
1.6
1.9

65.9
55.8
4.8
1.6
1.9

65.9
55.8
4.8
1.6
1.9

N/A
0.4
N/A
14.8

N/A
0.1
N/A
20.0

0.1
0.1
N/A
34.1

0.1
0.1
1.6
34.1

0.1
0.1
1.6
34.1

0.1
0.1
1.6
34.1

Demographic Profile

17

1970-71

1980-81

1990-91

2000-01

Actual
2003-04

Estimated
2004-05

Projected
2005-06

27,601
13.6%

29,706
14.8%

30,797
4.6%

40,856
6.7%

41,207
6.8%

41,207
7.9%

41,207
7.5%

N/A
N/A
N/A
N/A

N/A
N/A
N/A
N/A

5,700,825
(3.0)%
4.9%
.42

7,573,211
3.7%
2.7%
1.16

9,792,188
2.5%
4.4%
2.03

10,489,922
2.5%
4.6%
2.83

11,419,619
2.5%
4.8%
2.85

N/A

N/A

.46

1.33

.78

.87

.87

Total Budget (‘000s)
$95,835
Total GF Budget (‘000s)8
$62,343
Total Employees
5,670
Total Employees per 1,000 population
9.7
Non-Enterprise Employees
N/A
N/A
Enterprise Employees9
Property Tax Rate
1.75
G.O. Bond Rating
(Moody’s/Standard and Poor’s)
A/A
Number of PLT Licenses
N/A
City Retail Sales Tax Rate10
1%

$392,780
$221,106
9,435
11.1
N/A
N/A
1.75

$1,026,545
$591,021
11,388
11.2
N/A
N/A
1.79

$1,946,013
$953,324
14,352.0
10.6
8.6
2.0
1.82

$2,148,589
$822,263
14,996.7
10.8
8.8
2.0
1.82

$2,406,173
$884,416
15,620.3
11.1
9.1
2.1
1.82

$3,011,449
$973,170
15,770.1
10.5
8.5
2.0
1.82

Aa/AA
37,943
1%

Aa/AA+
43,756
1.2%

Aa1/AA+
51,000
1.8%

Aa1/AA+
54,348
1.8%

Aa1/AA+
54,800
1.8%

Aa1/AA+
55,000
1.8%

247.9

329.1

427.1

483.5

514.7

514.9

516.0

Police
Major Crimes
50,747
Dispatched Calls for Service
374,003
Authorized Sworn Police Officers
1,054

86,287
452,350
1,694

110,961
895,117
2,047

97,666
862,769
2,810

109,643
750,185
2,952

105,100
748,600
3,027

106,800
747,100
3,113

30
14,437
–
572

35
25,162
46,122
838

45
26,281
75,112
1,042

45
28,369
101,396
1,315

49
23,436
112,282
1,349

50
23,750
115,650
1,398

54
24,000
119,120
1,464

Building Inspections
Total Number of Inspections12

236,000

196,356

176,909

261,184

302,732

338,000

361,100

Streets
Total Miles
Miles Resurfaced and Sealed
Total Miles of Bikeway13

2,270
378
N/A

3,084
216
N/A

3,800
250
250

4,299
220
472

4,606
224
500

4,671
186
505

4,729
172
515

City Economic Profile
Median Household Income5
Personal Income Growth
(Metro Phoenix)
Assessed Valuation (‘000s)6
Employment Growth Rate7
Unemployment Rate8
Value of Residential Construction
(Billions)
Value of Commercial Construction
(Billions)

City Financial Profile

Infrastructure Profile
Area (Square Miles)

Fire
Fire Stations
Fire Calls and All Other Calls11
Emergency Medical Calls
Authorized Sworn Firefighters

18

1970-71

1980-81

1990-91

2000-01

Actual
2003-04

Estimated
2004-05

Projected
2005-06

423
23,097
22,765

555
39,097
28,129

761
50,825
28,414

906
70,750
36,500

945
77,302
32,062

959
82,000
31,782

970
84,950
32,735

2,925,700

6,500,000

22,175,000

35,900,000

38,200,000

39,400,000

40,200,000

204,800
325,300

281,900
379,000

281,392
513,643

327,953
1,051,935

346,854
915,000

354,000
945,000

361,000
1,021,000

121
N/A

137
1,303

181
2,206

199
3,332

207
4,374

211
4,409

216
4,445

2,368,232
704,940

3,691,745
1,182,606

5,962,411
1,732,410

9,151,000
2,016,000

11,529,473
2,047,973

12,336,232
2,177,230

12,960,328
2,303,530

2,637

4,497

4,776

6,080

6,402

6,441

6,520

Water
Connections
172,100
52.7
Production (billions of gallons)15

282,048
88.5

321,996
84.7

350,967
109.4

371,708
108.1

381,149
103.2

386,866
110.4

Wastewater
Connections
Miles of Line

250,199
3,040

311,980
3,661

327,051
4,174

343,533
4,487

351,050
4,569

356,924
4,673

Traffic Control and Lighting
Signalized Intersections
Street Lights
Traffic Accidents
Aviation
Passengers Arriving
and Departing
Solid Waste Collection
Residences Served
Tons Disposed at City Landfills
Municipal Parks
Number of Municipal Parks14
Developed Park Acres
Libraries
Book Circulation
Total Book Stock
Equipment Management
Number of Equipment
Units in Fleet

1
2
3
4
5
6
7

8
9
10

11
12
13
14
15

169,255
2,090

Population distribution figures are based on 2000 census figures. Totals may not add to 100 percent because of rounding.
These are modified racial categories as used by the Census Bureau for the 2000 Census.
Prior to the 2000 Census, Asian and Pacific Islander data were combined under the same category. Pre-2000 counts are included in the Asian category.
Pre-1980 census questionnaire did not include “Hispanic” or “Spanish” race categories.
Median Household Income based on data gathered by United States Census Bureau for city of Phoenix geographic area. Data for 2003-04, 2004-05
and 2005-06 based on 2000 Census.
The formula for assessing valuation was changed significantly in 1980 making comparisons to prior years not meaningful.
Employment growth rate figures are calendar year and not fiscal year. Calendar 2003 is shown under FY 2003-04, calendar 2004 is shown
under FY 2004-05, and projected calendar 2005 is shown under FY 2005-06. Estimates are for the Phoenix metro area and are obtained from the
Arizona Department of Economic Security.
As of FY 1998-99, Arizona Highway User Revenue funds are no longer included in the General Fund total.
Enterprise departments include Water, Aviation, Civic Plaza, Golf and Solid Waste Management.
Voters approved a 0.1 percent increase in most city sales tax categories effective December 1, 1993, for increased fire and police protection services.
Voters approved a 0.1 percent increase in most city sales tax categories effective November 1, 1999, to provide funds for parks enhancements
and improvements, and to acquire land for a Sonoran preserve. Voters also approved a 0.4 percent increase in most city sales tax categories
effective June 1, 2000, to provide funding for public transit improvements and light rail.
Prior to FY 1980-81, emergency medical, fire and all other calls were combined into one figure.
Includes building, electrical, mechanical, plumbing and general inspections. The lower numbers for recent years, as compared to 1970-71, are the result
of the implementation of the general inspection program that combined several residential inspections, performed by one inspector, into a single permit.
The bikeway program was approved by the City Council in 1987. Figures include on-street bike lanes, bike routes, and paved and unpaved paths.
This number includes parks and areas maintained by the Parks and Recreation Department. For example, retention basins, canal projects and trails.
Includes water produced for city of Phoenix only.

19

2005-06 Resource and Expenditure Summary

T

his section provides a broad overview of
the resources and expenditures included
in the 2005-06 budget. Information is
presented for general, special revenue
and enterprise funds. General funds,
which receive special attention by the
community, are highlighted throughout
this section. General funds are of
particular importance to our residents
as they provide for most basic services,
such as police, fire, parks and streets.
Enterprise funds are supported by fees
charged for the services provided with
the exception of the Civic Plaza which
has earmarked sales taxes as its primary
funding source. Special Revenue funds
are restricted to specific uses.
The 2005-06 budget, financed by
operating funds, totals $3,011,449,000.
As shown in the pie chart on page 23,
the General Fund portion of $973,170,000
is approximately 32 percent of the total.
The Enterprise funds, which include
Aviation, Water, Wastewater, Solid Waste,

Civic Plaza and Golf, make up another
32 percent of the total. Special Revenue
funds such as Arizona Highway User
Revenues, Local Transportation Assistance,
and grant funds such as Community
Development Block Grants, Human
Services grants and Housing grants
represent the remaining 36 percent
of the total budget.
In addition to presenting the budget
by funding source, the budget also is
described in terms of the major types
of activities or expenditures funded.
Included in the operating budget are
operating and maintenance expenses
that provide for ongoing costs of delivering
city services; capital expenditures for
pay-as-you-go projects for major additions,
improvements or renovations to city
facilities; and debt service payments to
retire outstanding bonds. The pie chart
on page 23 shows the distribution of the
total operating budget into these three
types of expenditures. Not included in
the operating budget are bonds and other

capital funds used for capital improvement
projects. These are included in a separate
capital improvement program.
The 2005-06 General Fund budget
includes only ongoing operating and
maintenance and pay-as-you-go capital
expenses. Debt service associated with
most General-funded activities is paid for
with property taxes or are shown in the
City Improvement fund both of which are
included in the Special Revenue funds
portion of the budget.
Finally, budgeted expenditures are
most easily understood on a departmental
basis. Detailed explanations of each
department’s budget are provided in the
Department Program Summary section of
this document. The bar chart on page 23
presents the General Fund budget on a
department-by-department basis.
The table below provides a comparison
of the 2005-06 budget to the 2004-05
adopted budget. Actual expenditures for
the 2003-04 fiscal year are also included.

2005-06 Budget Compared to 2004-05 Adopted Budget
(In Millions of Dollars)
2005-06
2003-04
Actual
Expenditures

2004-05
Adopted
Budget

Budget

Amount
Change

Percent
Change

$1,586.8

$1,854.5

$2,004.1

$149.6)

8.1%

Capital Expenditures

212.7

363.2

384.2

21.0)

5.8%

Lease Purchase and Debt Service

349.0

413.5

623.1

209.6)

50.7%

$2,148.5

$2,631.2

$3,011.4

$380.2)

14.4%

Operating and Maintenance Expenditures

Total

21

Citywide operating and maintenance
expenditures increased from 2004-05
primarily for inflationary increases such as
employee compensation including higher
pension and health care costs, added
operating costs related to the opening
of new capital facilities, added costs
associated with the new Public Safety
Enhancement fund, and other service
and growth-related increases in Aviation,
Development Services and other
enterprise funds.

inflationary increases in the costs of fuel
and utilities, and providing funding for
rising employee health care and public
safety pension costs and other negotiated
compensation increases. These cost
increases are partially offset by $15 million
in reductions.
The pie charts on the next page show
the 2005-06 General Fund budget
summarized by major programs and
major resources.

RESOURCES
2005-06 GENERAL FUND
BUDGET OVERVIEW
The 2005-06 General Fund budget of
$973.2 million provides for ongoing
operating and maintenance and capital
expenditures. The table below compares
the 2005-06 General Fund budget with
the adopted 2004-05 budget.
Operating and maintenance
expenditures show moderate growth
when compared to the 2004-05 adopted
budget. This growth results from planned
transition of grant-funded public safety
staff to the General Fund, reflecting full
year costs for facilities opened in 2004-05
plus new operating costs associated with
capital facilities that will open in 2005-06,

Resources include beginning fund
balances, fund transfers, revenues and
recoveries. Generally, current revenues
and fund transfers pay for current year
expenses. In the enterprise funds, fund
balances provide a financial cushion
against unanticipated changes. The
contingency allocation serves this same
purpose for the General Fund. While
minor changes in fund balances occur
from year to year, maintaining proper fund
balances over the long term and providing
for a contingency fund in the General
Fund are important components of sound
financial management and a significant
factor in bond ratings.

2005-06 Estimated
Beginning Fund Balances
In the General Fund, a fund balance may
not be budgeted. However, a contingency
fund, similar to a “rainy day fund”, may be
planned to provide a means to address
unexpected revenue decreases or
expenditure increases that may occur
throughout the year. Each year, most of
the contingency allocation remains unused
and, therefore, falls to the ending fund
balance along with any changes in
estimated revenues and expenditures.
The estimated 2005-06 beginning fund
balances of $873.7 million include $35.2
million in General funds, $501 million in
special revenue funds and $337.5 million
in enterprise funds. The estimated
beginning fund balance for Special
Revenue and Enterprise funds include:
Transit 2000 - $145.3 million; Water $125.6 million; Aviation - $60.9 million;
Wastewater - $64.3 million; Civic Plaza $60.4 million; Parks and Preserves - $48.6
million; Solid Waste - $26.4 million; Grant
Funds - $26.6 million; Arizona Highway
User Revenue - $26.3 million; Development
Services - $25.1 million; $180.1 million in
debt service and $48.9 million in various
other restricted funds.

2005-06 General Fund Budget Compared to 2004-05 Adopted Budget
(In Millions of Dollars)
2005-06

Operating and Maintenance Expenditures
Capital
Total

22

2003-04
Actual
Expenditures

2004-05
Adopted
Budget

Budget

Amount
Change

Percent
Change

$822.3

$925.6

$968.1

$42.5

4.6%

0.2

4.5

5.1

0.6

13.3%

$822.5

$930.1

$973.2

$43.1

4.6%

ALL SOURCES OF FUNDS

ALL SOURCES OF FUNDS

Total Resources – $3.0 Billion

Total Expenditures – $3.0 Billion

Enterprise Funds 32%

Operation
& Maintenance
66%

Debt Service 21%

General Funds 32%

Special Revenue
Funds 36%

Capital 13%

GENERAL FUNDS

GENERAL FUNDS

Total Resources – $973 Million

Total Expenditures – $973 Million
Public Safety and
Criminal Justice 62%

Property Tax 9%

Local Sales Tax
40%

Other Resources
5%
Environmental
Services
and Other 5%

User Fees/
Other
Revenue 12%

Transportation
4%

State-Shared
Revenues 34%

General
Government 10%

Community Development
and Enrichment* 19%
*Includes Parks, Library, Human Services, Neighborhood
Services, Planning and Economic Development

Expenditures by Department
2005-06 General Fund Budget

Millions of Dollars
$350
300
250
200
150
100
50

Engineering & Architectural
Services

City Manager

Parking Garages

City Auditor

Economic Development

Public Information

Equal Opportunity

Law

Budget & Research

Planning

Information Technology

City Clerk

Mayor & City Council

Personnel

Functions*

Public Works

Downtown Development

*Functions include several small offices such as the Office of Arts
and Culture, Education Office and Environmental Programs.

Neighborhood Services

Prosecutor & Defender

Finance

Street Transportation

Contingencies

Public Transit

Human Services

Library

Municipal Court

Fire

Parks and Recreation

Police

0

23

2004-05 General Fund
Estimated Ending Balance
As shown in the following table, the
estimated 2004-05 ending General Fund
balance is $35.2 million. The balance
results primarily from a $42.5 million
decrease in operating expenditures,
offsetting an estimated $5.8 million
decrease in current year revenues and a
$6.4 million lower than planned beginning
balance. The decrease in estimated
2004-05 General Fund expenditures is
largely due to unused contingency funds,
shifting $10 million in capital equipment
purchases to available lease/purchase
financing, shifting $10 million in Street
Transportation operating costs to Arizona
Highway User Revenue funds, the
carryover of some General Fund expenses
not completed in the current year, and
a $3.2 million decrease in capital
expenditures. The majority of the revenue
decrease is in city excise taxes and in
various user fees.

2005-06 Estimated Revenues
Revenues from taxes, fees, interest, grants
and other sources provide resources to
fund programs and services delivered by
the city. Revenues for 2005-06 are
estimated at $2,534,234,000. This is
$133,079,000, or 5.5 percent above the
2004-05 estimate of $2,401,155,000.
General Fund revenues are estimated at
$922,162,000, which is $77,273,000 or
9.1 percent more than the 2004-05
estimates. The following table provides
a comparison of the 2005-06 estimated
revenues to 2004-05 estimates and 2003-04
actual collections. Detailed explanations
by category are provided in the 2005-06
Revenue Estimates section of this
document.
The state and local economy has been
in a moderate recovery period since late
2003-04 and that recovery has continued
in 2004-05. It is assumed that this rate
of growth will improve in 2005-06, the
economy being bolstered by increased
retail spending and the continuation of
the tremendous growth in contracting.

24

Included in 2005-06 estimates for the
Enterprise funds are full-year impacts of
rate increases for Water and Wastewater
services. The 2005-06 estimate for Special
Revenue funds includes a decrease in
federal funds of $29 million.

2005-06 Transfers
to the General Fund
Transfers are used to allocate resources
between funds for purposes of matching
costs with benefits received through a
central service cost allocation or to assess
in-lieu property taxes.
Transfers to the General Fund for
2005-06 total $45 million. This amount
reflects $44.6 million from Enterprise and
other funds to recoup central service costs
and/or payments for in-lieu property taxes
from the Aviation, Water and Wastewater,
Solid Waste, Civic Plaza and Development
Services funds. Central service provides
a repayment to the General Fund for
services provided by departments such
as Personnel, Finance, Law and other
administrative support areas that are
general funded. This transfer is calculated
by the Finance department in accordance
with generally accepted full-cost
accounting principles and is in accordance
with long-established City Councilapproved policy. The Enterprise
transfers also include $342,000 from
the Golf Course fund to recoup Parks,
Recreation and Golf department direct
administrative support costs. The Golf
fund does not pay citywide central service
costs or in-lieu property taxes.
Approximately $0.1 million in
miscellaneous transfers from other funds
is also included. As a result, total transfers
to the General Fund exclusive of excise
tax-related items are $45 million. A
transfer of $665 million from the excise
tax fund represents the General Fund
share of local and state-shared sales taxes
and fees and state-shared income taxes.
However, this amount is reflected in
revenues, rather than a transfer,
throughout this section.

2005-06 ESTIMATED
ENDING BALANCES
Arizona budget law requires a balanced
General Fund budget. No General Fund
balances may be accumulated in reserve
for subsequent fiscal years. Arizona law
does, however, provide for a contingency
or “rainy day fund” each year. For 2005-06,
$24.7 million is included for the General
Fund contingency and is discussed in more
detail in the Contingency section of this
document. As a result, budgeted General
Fund resources equal expenditures.
However, any unused contingency amounts
at year-end fall to a General Fund ending
balance. Generally, about 95 percent of
the General Fund contingency remains
unused each year.
Changes in Special Revenue and
Enterprise fund balances are primarily
due to the carryover of large capital
projects from one year to the next.
Beginning and ending fund balances
are shown in Schedule 1.
Year-end balances are planned in the
Enterprise funds and other self-supporting
funds primarily to provide for adequate
funds at the beginning of the following
fiscal year. Such funds are used to
stabilize rate increases associated with
fluctuations in service demand changes,
insure bondholders of future debt service
payment and to accumulate funds
for annual pay-as-you-go capital
improvements.
The estimated 2005-06 ending balance
of $429.3 million includes: Transit 2000 $82 million; Water - $102.8 million; Civic
Plaza - $51.6 million; Wastewater - $41.8
million; Parks and Preserves - $6.6 million;
Solid Waste - $16.7 million; Aviation $18.1 million; Development Services $23.4 million; Sports Facilities - $ 13.7
million and $72.6 million in various other
Special Revenue and Enterprise funds.

General Fund Balance Analysis
(In Thousands of Dollars)
2003-04

2004-05
Budget

Actuals

Estimate Over (Under) Budget
Estimate

Amount

Percent

Resources
Beginning Balances July 1
Revenue
Recoveries
Transfers

$ 63,006
790,216
1,223
21,373

$

59,797
850,735
1,500
18,088

$

53,362
844,889
1,500
19,853

$ (6,435)
(5,846)
0)
1,765)))

(10.8)%
(0.7)%
0)%
9.8)%

Total Resources

$ 875,818

$ 930,120

$ 919,604

$ (10,516)

(1.1)%

822,262
194

925,603
4,517

883,062
1,353

(42,541)
(3,164)

(4.6)%
(70.0)%

Total Expenditures

$ 822,456

$ 930,120

$ 884,415

$ (45,705)

(4.9)%

Ending Fund Balance

$ 53,362

$

$

$ 35,189

100.0+%

Expenditures
Operating Expenditures
Capital

0

35,189

2005-06 Estimated Revenues Compared to 2004-05 Estimates
(In Thousands of Dollars)
2005-06

Fund Types
General

2003-04
Actuals

2004-05
Estimate

Estimate

Amount
Change

Percent
Change

$ 790,216

$ 844,889

$ 922,162

$ 77,273

9.1%

Special Revenue Funds

654,551

746,064

746,067

3

0%

Enterprise Funds

773,800

810,202

866,005

55,803

6.9%

$2,218,567

$2,401,155

$2,534,234

$ 133,079

5.5%

Total

25

Services to the Community

Phoenix has been a well-established
economic growth area since the end of
World War II. Historically, during periods
of national economic expansion, the local
Phoenix economy has grown much more
rapidly than the rest of the United States.
During periods of national recession, the
local economy usually continues to grow at
a slow pace. It normally takes a prolonged
period of national economic stagnation for
Phoenix to experience employment
decline. The diversity of the Phoenix
economy helps insulate it from the
severe downturns experienced in many
communities reliant on a narrower range
of industries. In fact, employment growth
in Phoenix has substantially exceeded
national employment growth during
recoveries. However, in the last few years
the city has experienced the effects of a
recession, both at the local and state level.
Although the economy has improved
over the past year and the city’s revenue
growth is positive, significant unavoidable
costs are outpacing revenue growth.
Faced with this situation in early February,
the Mayor and City Council responded
quickly and adopted $35 million in actions
to immediately improve our financial

position. Following that, city staff
identified a number of items that offered
additional cost savings. However, the
General Fund still faced a shortfall of
$15.4 million.
General Fund cuts were approved by
the Mayor and City Council to close this
gap. Including this year, the General Fund
budget has been reduced by $117 million
over the past four years. The reductions
this year are particularly difficult because
many city services are affected. However,
at the direction of the Mayor and City
Council, public safety services were
not reduced.
Contributing to the General Fund
shortfall is the need to open numerous
new city facilities to provide services in
underserved areas of the city. The
facilities include new senior centers,
a recreation center at HOPE VI, and
several park facilities, including the
Camp Colley outdoor recreation camp.
Some budget additions were possible
using Transit 2000, Development Services,
Water, Wastewater, Solid Waste, Civic
Plaza, and Aviation funds. Transit 2000
will provide for additional trips on highly
used routes as well as a Van Buren Street
route extension to Dysart Road.
Development Services funds will be
used to address workload issues in the
expanding building market. Water and

Wastewater funds will be used to staff new
facilities, improve environmental quality
monitoring, and expand interaction with
the development community. Solid Waste
funds will be used to add staff and
equipment for the North Gateway Transfer
Station and supervisory staff for the
growing South Region. Civic Plaza funds
will be used to increase convention center
marketing efforts as the expanded
convention space materializes. Aviation
funds will be used to add staff to keep up
with increased growth as well as maintain
and operate the new Rental Car Center
and Bus Maintenance Facility.
The city’s Housing Department which
provides safe, clean, affordable housing
programs receives all of its funding from
the federal government. Unfortunately,
available federal funds have not kept up
with demands for services; therefore, a
reduction of $5.1 million and 88 positions
was necessary to bring expenditures in line
with revenues and maintain reserves at
appropriate levels.
The chart that follows indicates
how major services provided to Phoenix
residents have been adjusted in response
to local economic and financial conditions.
Because benchmarking is an important
measure of the efficiency and effectiveness
of services provided, we also have included
multi-city comparisons of performance
in several areas. Much of the data for
these comparisons is taken from the 2003
International City/County Management
Association's Center for Performance
Measurement report.

27

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

Between 1999 and 2004, grant funding throughout
the Department of Justice Universal Hiring
Program enabled the department to add 289 police
officer positions. Seventy of these positions were
added in 2004-05 to help the department maintain
adequate staffing in anticipation of the turnover
resulting from the Deferred Retirement Options
Plan (DROP). The budget also added 43 new
civilian positions. The civilian additions included
four support staff for the neighborhood police
station located at 24th Street and Broadway Road;
30 communications operators and three
communications supervisors to assist with the
increased numbers of calls received by the Police
Department’s Communication Bureau; and four
laboratory technicians and one criminalist
supervisor to address increasing caseloads and
to help maintain turnaround times in the
police crime lab.

In March 2005, Phoenix voters approved
new franchise agreements between the
city and Arizona Public Service and
Southwest Gas. The new agreements
will generate an additional $16 million
annually and will be used to provide
critical public safety improvements.
The 2005-06 budget reflects the addition
of 86 sworn and 41 civilian support
positions which will be funded with
the revenue generated from the new
franchise agreements.

PUBLIC SAFETY
POLICE

Personnel Resources:
In 1994-95, the Police
Department had 2,284 sworn
officers and 670 civilian
employees.

The budget also includes funding to
replace expiring Local Law Enforcement
Block Grant funds with General Funds
to continue seven evidence technicians
and a criminalist supervisor in the
police crime lab.
In 2005-06, the Police Department will
have 3,113 sworn positions or 2.1 for
every 1,000 residents, and 1,046 civilian
employees.

Response Time Average:
In 1994-95, the Police
Department maintained
a 4 minute 54 second response
time for Priority 1 emergency calls.

In 1994-95, because of increased service demand,
budgeted response times for Priority 1 emergency
calls had gradually increased from 4 minutes 54
seconds to 5 minutes 30 seconds in 2004-05.
During this same time period however, the
percentage of 911 calls answered within 10
seconds improved from 78 percent to 85 percent.
Based on 2003 ICMA data, city of Phoenix actual
response times compare favorably to those of
the benchmark cities as noted below:

Total Average Response Times
to Top Priority Calls:
Tucson – 4 min 49 sec
San Antonio – 4 min 50 sec
PHOENIX – 5 min 23 sec
San Jose – 5 min 30 sec
Oklahoma City – 7 min 34 sec
Austin – 7 min 44 sec

28

The 2005-06 budget provides for a
continued 5 minutes 30 seconds average
response time for Priority 1 calls.

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

Since 1981-82, response times have increased 35
percent to 4 minutes 59 seconds for all fire and
emergency medical calls. This is a 1 second
increase over the previous year primarily due to
increased population growth and traffic congestion.
The overall emergency call activity level increased
216 percent (since 1981-82) and 20.6 percent
(since 1994-95) during this period.

Three new fire stations are scheduled
to open in 2005-06. The fire stations
will be staffed with existing adaptive
response companies until 2006-07 when
firefighters can be hired and trained.
Adaptive response companies are full
service paramedic engine companies
currently deployed to respond in high
volume areas.

PUBLIC SAFETY
FIRE

Response Time Average:
In 1994-95, the Fire Department
maintained an average response
time of 3 minutes 48 seconds for
all fire and emergency medical calls.

Based on 2003 ICMA data, city of Phoenix response
times compare favorably to those of other
benchmark cities as noted below:

Percentage of All Calls to Which
Response Time is Under 8 Minutes:
Oklahoma City – 91 percent
Long Beach – 87 percent
PHOENIX – 84 percent
Austin – 84 percent
San Jose – 82 percent
San Antonio – 82 percent

Emergency Transportation:
In 1994-95, the city of Phoenix
had a total of 14 full-time and
7 part-time ambulances in service.

The city initiated the Emergency Transportation
System in 1985-86 with 10 full-time and six
part-time ambulances. In 1987-88, the Emergency
Transportation System was increased to 12 full-time
and six part-time ambulances. The addition of four
ambulances funded with revenue from Proposition
301 and the conversion of the department’s last
medic units to ambulances resulted in 19 full-time
and nine part-time ambulances in service during
1997-98. The 2000-01 budget included funding to
add a full-time ambulance at Station 38 in
Ahwatukee Foothills. Two part-time ambulances
were added in mid-2002-03 to improve response
times in fast growing, outlying areas of the city.

The 2005-06 budget includes funding for
one additional full-time ambulance at
Station 57 at 15th Avenue and Dobbins
Road. In addition, three heavy rescues,
funded with the revenue from new
franchise agreements, will respond to
emergency medical calls at incidents
with mass casualties.

The 2004-05 budget included funding for two
additional full-time ambulances at stations located
at 40th Street and Baseline Road and I-17 and
Carefree Highway. These additions increased the
Emergency Transportation System to 22 full-time
and 11 part-time ambulances.

29

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In the 2004-05 budget, funds improved service
for Dial-a-Ride, with increased service hours on
weekdays and weekends/holidays. Customer
Service and response to calls for service also
were improved.

The 2005-06 budget funds will improve
service for Dial-a-Ride, with an
estimated increase of 12,800 service
hours to weekday service.

TRANSPORTATION
PUBLIC TRANSIT

Service Miles/Hours:
In 1994-95, 11,000,000 annual
bus service miles were provided
on weekdays and Saturdays in
the city of Phoenix.

The 2004-05 budget also funded and extension for
the Green Line (Thomas Road) from 83rd Avenue
to 115th Avenue then south to the new Avondale
Civic Center. The addition was jointly funded by
the cities of Avondale and Phoenix. Additional
RAPID trips were added to three existing corridors,
which added 109 new miles of service each
weekday. In addition, two new positions were
added to enhance bus maintenance and contract
compliance capabilities.
As a result of these continuing enhancements, as
well as a full year of 2003-04 service improvements,
annual 2004-05 bus service miles are estimated
at 17,240,000 and Dial-a-Ride service hours are
estimated at 323,850.

Average Weekday Bus Ridership:
In 1994-95, the average weekday
bus ridership was 115,000.

30

Under the 2004-05 budget, weekday ridership is
estimated to rise to 143,262.

The 2005-06 budget also funds
additional trips to alleviate overcrowded
conditions on popular local routes
including bus service on Van Buren
(Route 3) from 67th Avenue to the city
limits at 83rd Avenue. The addition was
jointly funded by the cities of Avondale
and Phoenix. These increases in service
are offset by the elimination of low use
evening weekday service on 12 of 16
routes between the hours of 10:30 p.m.
and midnight due to General Fund
expenditure reductions.
As a result of the continuing
enhancements, as well as a full year
of 2004-05 service improvements,
annual 2005-06 bus miles are estimated
at 17,336,200 and Dial-a-Ride service
hours are estimated at 336,650.

Under the 2005-06 budget, weekday
ridership is estimated to rise to 147,785.

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

The 2000-01 budget increased frequency of service
to every two weeks to improve air quality. The
budget also added capital funding to improve
maintenance, pave dirt alleys, and install
additional sidewalks and curbs. In 2003-04,
budget constraints reduced funding for making
quick concrete repairs to infrastructure
throughout the city. Funding for paving dirt
alleys also was reduced as was funding for
retrofitting sidewalk ramps. An asphalt crew
responsible for repairing asphalt pavement on
major, collector and local streets was eliminated.

Due to budget constraints, the 2005-06
budget continues to reduce funding for
paving dirt alleys.

STREET TRANSPORTATION

Major and Collector Street
Sweeping and Maintenance:
In 1994-95, sweeping major and
collector streets was scheduled
for every three weeks.

Continued budget constraints in 2004-05 reduced
funding, again, for paving dirt alleys and
retrofitting sidewalk ramps. In addition, funding
for neighborhood concrete repair was reduced.

Residential Street Sweeping:
In 1994-95, the city of Phoenix
provided street sweeping service
three times a year.

In 1997-98, street sweeping frequency returned
to four times a year to better coordinate with
quarterly trash collection and improve the
aesthetics of neighborhoods.

No changes are included in the
2005-06 budget.

No changes were included in the 2004-05 budget.

31

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

Beginning in 1995-96, the program was expanded
to include 95 miles of sealcoat. In 1997-98,
sealcoat miles increased to approximately
100 miles annually.

The 2005-06 budget further reduces
funding of the micro-seal program.
Sealcoating will be provided on 63 miles
of city streets annually.

STREET TRANSPORTATION

Sealcoat:
In 1994-95, the city of Phoenix
provided 53 miles of sealcoat.

In 2004-05, due to budget constraints and
increased cost of materials, the number of
sealcoat miles was reduced to 76 miles annually.
Based on 2003 ICMA data, city of Phoenix paved
road rehabilitation expenditures per capita
compare favorably to those of other benchmark
cities as noted below:

Paved Road Rehabilitation
Expenditures per Capita:
Tucson – $7.03
Austin – $15.62
San Jose – $15.87
PHOENIX – $16.13
San Antonio – $17.17
Oklahoma City – $19.63
Kansas City – $21.71

32

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

This program funded 82 miles of overlay in fiscal
year 1995-96 and 95 miles in fiscal year 1997-98.
Between fiscal years 1998-99 and 2003-04 and
average of 131 miles of overlay were performed
annually.

No changes are included in the
2005-06 budget.

STREET TRANSPORTATION

Asphalt Overlay:
In 1994-95, 79 miles of
overlay were performed.

In 2004-05 it is estimated that 124 miles will be
overlaid. This decrease in miles is primarily due
to increased cost of materials.

COMMUNITY DEVELOPMENT
HOUSING

Scattered Sites Housing Program:
In 1994-95, the Housing Department
had 230 units.

Affordable Housing Program:
In 1994-95, this program had
695 units for families and
individuals.

This homeownership program allows eligible
tenants the opportunity to purchase their home.
The program expanded to a total of 470 homes in
1998-99. The current inventory of 430 units
reflects the sale of 40 homes to eligible tenants
over the last few years.

Under the 2005-06 budget, the program
is expected to purchase 10 additional
homes, bringing the inventory to 440
homes.

This program began in 1990-91 and has expanded
to a total of 1,359 city-owned units for families
and individuals with 325 units added with 2001
bond funds, and 339 units added with other
funding sources.

Under the 2005-06 budget, the program
is expected to maintain an inventory of
1,359 units.

33

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

This program’s beginning inventory remained at
1,776 units located at various sites. Due to the
reconstruction activities resulting from the HOPE
VI grant, 280 units became unavailable at the
Matthew Henson housing site. One additional
unit was transferred to the Saint Vincent de
Paul organization.

Under the 2005-06 budget, the program
is expected to reduce its inventory to
1,417 due to the remaining 78 units
becoming unavailable at Matthew
Henson.

COMMUNITY DEVELOPMENT
HOUSING

Conventional Housing Program:
This program has been in effect
since 1951-52. In 1994-95, there
were 1,776 units.

The inventory at the end of 2004-05 was 1,495
units.

NEIGHBORHOOD SERVICES

Neighborhood Preservation
Case Cycle Time (Days)
In 1994-95, 135 days were
needed to complete a
neighborhood preservation case.

In 1995-96, 98.6 days were needed to complete
a neighborhood preservation case. Over time,
positions have been added to improve cycle times
and implement a Landlord/Tenant Education Slum
Prevention program. Case cycle times improved
from 83 days in 2001-02 to 59 in 2003-04 as staff
added in previous years was fully trained and
gained expertise in performing their duties.
Case cycle times reduced to 58 days in 2004-05.
Based on 2003 ICMA data, city of Phoenix code
enforcement expenditures per capita compares
very favorably to those of other benchmark cities
as noted below:

Code Enforcement Expenditures
per Capita:
Austin – $3.94
PHOENIX – $5.00
Oklahoma City - $5.92
Long Beach - $8.06

34

The 2005-06 budget reduction of staff
and abatement funding is expected to
increase the case cycle time to 59 days.

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In 2004, Phoenix’s employment growth rate
was better than that of all of the following
benchmark cities:

It is anticipated employment will
continue to grow in 2005-06, although
growth will be at a modest rate.

ECONOMIC DEVELOPMENT

Employment Growth Rate
Compared to Other Cities
This is a new measure.

PHOENIX - 2.8%
San Antonio - 1.6%
San Diego - 1.5%
Austin-San Marcos - 0.9%
Dallas - 0.9%
Ft. Worth-Arlington - 1.0%
Los Angeles-Long Beach -0.6%
Kansas City - 0.4%
San Jose - (1.1)%

COMMUNITY ENRICHMENT
HUMAN SERVICES

Head Start Program:
In 1994-95, the Human Services
Department served 2,501 children.

School Based/School Linked
Program:
In 1994-95, this program provided
services at 22 school sites.

Senior Nutrition Program:
In 1994-95, the Human Services
Department served 497,700
congregate and home-delivered
meals.

The program is expected to serve 3,194 children
during 2004-05.

No changes are included in the
2005-06 budget.

The program began in 1990 with five school sites.
In 1996-97, the program operated from 20 school
sites and served 3,312 youth. By 1997-98, the
program operated from 25 school sites through
additional grant funding and various partnerships
and served 3,360 youth. In 2004-05, the program
is expected to serve 2,500 youth at seven sites.

The program is expected to serve
2,500 youth in the 2005-06.

By 1998-99, the program served 499,000
congregate and home-delivered meals.
In 2000-01, the program added a cook position
and served 544,000 meals. For 2004-05 the
program is expected to serve 598,000
congregate and home-delivered meals.

The Westside and Shadow Mountain
Senior Centers will relocate to new
expanded space in the spring of 2006.
With the expansion, the program is
expected to serve 599,500 congregate
and home-delivered meals.

35

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In 1996-97, the Paradise Valley pool was added,
resulting in 28 total swimming pools. In 2000-01,
staffing was added to provide year-round operation
for the Paradise Valley Diving Well. In 2003-04,
Pecos Pool was opened, increasing the number
of pools to 29. No changes were included in the
2004-05 budget.

No changes are included in the
2005-06 budget.

In 1996-97, eight lifeguards were added to
maintain health and safety standards. In 2003-04,
budget considerations forced the city to reduce
the swim season to 10 weeks. All pools closed in
mid-August to coincide with the beginning of the
school year. No changes were included in the
2004-05 budget.

The 2005-06 budget reduces the swim
season by closing pools one week earlier,
resulting in a 9-week season.

In 1995-96, the city of Phoenix provided 121
schools with 24-30 hours of programming for
six to eight weeks during the summer months.
Six sites were added in 1999-00 for a total of
127 program sites.

No changes are included in the
2005-06 budget.

PARKS AND RECREATION

Swimming Pools:
In 1994-95, the city of Phoenix
had 27 public swimming pools.

Swimming Pool Season:
In 1994-95, swimming pools
were open for 12 weeks
during the summer months.

Children’s Summer
Recreation Programs:
In 1994-95, the city of Phoenix
provided recreation programs
at 113 schools for 24-30 hours
of programming for 6-8 weeks
during the summer months.

36

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In 1995-96, the program expanded to a total of
61 sites. In 1996-97, 11 new sites were added
citywide for a total of 72 sites. In 1998-99, four
new sites were added for a total of 76 sites.
Also at these four sites, Saturday programming
was provided from 10 a.m. to 4 p.m. In 1999-00,
25 new sites were added for a total of 101. The
2000-01 budget added 32 new sites, for a total
of 133. The 2001-02 budget added another
33 sites, raising the total to 166. No changes
were included in the 2004-05 budget.

No changes are included in the
2005-06 budget.

The 1998-99 budget added Thursday evening
hours increasing total weekly hours to 70.
The 2000-01 budget extended service hours to
9 p.m. on school nights. As a result, the Central
Library provided service 75 hours per week.
In April 2003, Central Library hours were reduced
to 66 hours per week as a result of citywide
budget reductions.

No service hour changes are included
in the 2005-06 budget.

PARKS AND RECREATION

School Recreation Program
During School Year:
In 1994-95, two hours of
after-school recreation
programming from 3 to 5 p.m.
were approved on weekdays
for nine months each year
at 24 sites citywide.

LIBRARY

Central Library:
The new Burton Barr
Central Library opened
in May 1995, for 67 hours
of operation per week.

37

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In 1995-96, 17 service hours were added at six
branches, bringing total service hours for 11
branch libraries to 681 a week during the school
year. Desert Sage Library opened in July 1997 for
70 service hours per week, increasing the number
of branch libraries to 12 and the total hours of
service to 751 during the school year. Beginning in
1998-99, five branches increased hours to 9 a.m.
to 9 p.m. Monday through Thursday and 9 a.m.
to 6 p.m. Fridays. Beginning in 1999-00, seven
branches that were only open on Sundays during
the school year received funding to open on
Sundays all year. In 2000-01 all branch library
hours were extended to 9 p.m. on school nights.
As a result, every branch library was open 75 hours
per week or 900 hours per week total for 12
branches. In April 2003, branch library hours were
reduced to 66 hours per week (792 total) as a
result of budget reductions. The 2004-05 budget
funded the opening of the new Palo Verde branch.
This 16,000-square-foot branch library replaced the
existing 10,000-square-foot Palo Verde Library,
which opened in 1966.

No service hour changes are included
in the 2005-06 budget. The planned
opening of the new regional Cesar
Chavez branch was delayed from
April until July 2006 as part of the
budget-balancing actions.

LIBRARY

Branch Libraries:
In 1994-95, the city had
eleven branch libraries
with a total of 667 hours
of weekly library service.

The new 15,000-square-foot Desert Broom Library
serving the Desert View Village area opened in
February 2005 for 66 hours per week, increasing
total branch library service hours to 858 per week.

Comparisons with
Other Library Systems:
This is a new measure.

Based on 2003 ICMA data, the Phoenix library
system compared very favorably to other
benchmark cities as noted below:

Cost per Item Circulated:
PHOENIX – $1.99
Austin – $3.89
Long Beach – $5.13

38

This trend is expected to continue
during the 2005-06 budget.

PROGRAM SERVICE LEVEL
IN 1994-95

SERVICE CHANGES
THROUGH 2004-05

SERVICE CHANGES
FOR 2005-06

In a March 2004 survey, Phoenix’s average monthly
water bill compared favorably to the following
benchmark cities:

It is anticipated Phoenix water rates will
continue this trend during 2005-06.

WATER SERVICES

Water Bill Comparison for
Single-Family Homes
This is a new measure.

San Jose – $42.18
Austin – $32.05
Kansas City – $31.96
Dallas – $28.42
Tucson – $26.12
Albuquerque – $24.32
PHOENIX – $21.88
San Antonio – $17.85

Wastewater Bill Comparison
for Single-Family Homes
This is a new measure.

In a March 2004 survey, Phoenix’s average
monthly wastewater bill compared favorably
to the following benchmark cities:

It is anticipated Phoenix wastewater
rates will continue this trend during
2005-06.

Austin – $43.14
Dallas – $28.38
Kansas City – $22.46
San Antonio – $20.36
San Jose – $19.81
Albuquerque – $16.24
PHOENIX – $15.97
Tucson – $14.47

39

Budget Process, Council Review and Input,
Public Hearings and Budget Adoption

E

ach year, the city of Phoenix budget
is developed in conjunction with the
Mayor and City Council, residents, city
employees, the City Manager’s Office
and all city departments.

Modified Zero-Base Budgeting Process
The city of Phoenix uses a modified
zero-base budgeting process. Each fall,
departments submit an estimate (called
the “base budget”) of the costs associated
with providing their current levels of
service for the following year. Budget
and Research staff review these base
budget submissions to ensure that only
the funding needed to continue current
service levels is included in the
department’s base budget for the following
year. This Budget and Research review is
called a technical review because of its
non-programmatic, line item by line item
review. A department’s base budget
funding may differ from its current year
funding for a variety of reasons. For
example, an increase or decrease in
electricity or postage rates would be
reflected in the base budget.
In addition to base budget submissions,
departments identify 5 to 10 percent of
their budget for potential elimination.
These submissions are called base
reductions and represent the department’s
lowest-priority activities. At the same
time, departments are asked to submit
any requests for new or expanded
programs. These are called supplemental
budget requests.
Base reductions and supplemental
requests include all costs associated
with a specific program or service. For
example, costs for a swimming pool would
include personnel costs for a lifeguard and
other staff, chemicals for the pool, building
maintenance and utilities.

When base reductions and
supplemental requests are submitted,
they are ranked together according to the
department’s priorities. The department’s
ranking indicates whether making a base
reduction to add a new program would
be possible, and also indicates which
supplemental programs and base
reductions are most critical to the
department. City Council members
also are asked to submit their own ideas
for budget changes.
The City Council then provides input to
the city manager for the preparation of the
Trial Budget, which is submitted to City
Council early each spring. The purpose
of the Trial Budget is to enable the
community and the City Council to
comment on a balanced budget well before
the city manager is required to submit his
recommended budget to the City Council
in mid-May. Public hearings are conducted
throughout the community during day and
evening hours. The City Council makes
final budget recommendations after the
city manager’s preliminary budget is
submitted.

2005-06 Budget Process
In December 2004, Budget and Research
staff presented an early General Fund
budget outlook to the City Council.
The Mayor and Council were advised that
current year revenue growth was positive
but balancing the 2005-06 budget would
be challenging. Several factors impacting
next year's budget included a reduction in
the prior year carryover fund balance, new
operating costs for capital facilities coming
on line next fiscal year in addition to the
full-year's impact of facilities opened
throughout the current fiscal year,

increased pension costs, negotiated
employee compensation increases, and
the two-year impact of the public safety
DROP early hire program. Due to these
costs, the report concluded that budget
cuts could be required to balance the
upcoming 2005-06 budget.
In anticipation of a budget shortfall,
in December 2004, city departments were
asked to submit base reductions equal to
5 percent of their current budget for
management review. As this was the
fourth year that expenditures had to be cut
and the easier reductions had been made
in previous years, departments were asked
to identify cuts that would have the least
impact on the community. Departments
also were asked to request only the bare
minimum needed to open capital facilities
coming on line in 2005-06.
Budget and Research presented an
updated General Fund budget outlook in
February 2005. At that time, the Mayor
and Council were advised that although
revenues were growing modestly, expenses
were growing at a faster rate. The updated
expenditure forecast showed a 2005-06
general fund deficit of $68.7 million.
General fund revenues were forecasted to
grow by about 8 percent next year but
costs were expected to grow by 14.9
percent. Major contributors to the
deficit included fuel and utility inflation,
employee compensation increases,
contingency fund restoration, expiring
public safety grants, costs of new capital
facilities and decreased revenues
connected to recent electricity shortages
and related conservation efforts. Staff
recommended some immediate actions to
reduce the deficit. This included freeing

41

up general funds by using increased
Arizona Highway User Revenue for the
Street Transportation operating budget.
Also recommended was lease purchase
financing for planned equipment
purchases. The budget calendar was
proposed to be advanced by one month
so that 13 months in savings could be
achieved rather than 12. Finally, the
secondary and primary property tax rates
were shifted to provide additional general
operating funds. The total property tax
rate remained unchanged. These financial
actions reduced the 2005-06 deficit to
$33.7 million. The Mayor and Council
approved these budget-balancing measures
and requested that public safety personnel
be excluded from any budget cuts. The
city manager also implemented a hiring
freeze on all civilian positions.
On March 8, a budget reduction
proposal totaling $16.3 million was
presented to the Mayor and City Council.
The deficit was decreased from the
original $33.7 million to $16.3 million
by identifying additional line item cuts,
increasing revenue projections based on
improved sales tax collections, reduced
costs associated with opening new capital
facilities due to revised construction
timelines, and transferring $9.8 million
associated with the public safety early
hiring plan from the General Fund to
the revenue generated by new franchise
agreements.

42

The proposed reductions included
108.9 jobs. Among the recommended cuts
were the closing of a family service center
and one senior center, closing a second
senior center for six months, the delayed
opening of the new Cesar Chavez Regional
Library, increased library fines, reductions
in parks maintenance, reduced community
center hours, closing city pools one week
earlier, less street repairs, and a reduction
in bus service.
The proposed budget added $2.1
million to fund the operating costs of
several new capital facilities. This
included replacement senior centers
for the Westside Senior Center and the
Shadow Mountain Senior Center, the newly
renovated Memorial Hall at Steele Indian
School Park, Indian Bend Wash Park,
a community park at 17th and Peoria
avenues, the HOPE VI Coleman Recreation
Center and park, Bethany Home Outfall
Channel and the full-time operation of the
Camp Colley outdoor recreation camp.
Funding also was added for fire
communication operators, annual
maintenance costs of the police and
fire twin engine helicopter, as well
as maintenance costs for new street
landscaping and the Art Museum
expansion. The proposed budget also
recommended that $1.0 million in expiring
grant programs be transitioned to
the General Fund. The programs
recommended for transition support the
criminal justice system. These include
the Community Gun Violence program,
Victim's Rights funding, prosecutors and
evidence technicians. Programs which
were not recommended for transitioning
to the General Fund are the Operation
Attendance is Mandatory (AIM) truancy
reduction program, Young First Offender
program, Daring Adventures program for
teens and adults with disabilities, Victims
Restitution services and Driving under the
Influence (DUI) training. These programs
will end on the grant expiration date.

The proposed 2005-06 budget for
Transit 2000 funds included $300,000
to provide improvements to Dial-a-Ride
services, add trips to alleviate overcrowded
conditions on popular local routes, and
in partnership with the city of Avondale,
extend Route 3- Van Buren from 67th
Avenue to 83rd Avenue.
Improvements in the enterprise-funded
departments also were included in the
proposed budget. For the Aviation
Department, staff and operating costs
were added to support the new rental car
center and bus maintenance facility and
additional staff was provided for parking
management, the Lost and Found Office
and supply warehouse. Increased staff was
also added to comply with Transportation
Security Administration mandates and
funding for five additional police officers
was included as well. In the Public Works
Department Solid Waste Division,
additional staff was provided for the
new North Gateway Transfer Station, to
supervise the growing south region, and
to implement the intergovernmental
agreement with the town of Buckeye
related to the new landfill. Water and
Wastewater Services improvements
include staff and equipment to improve
security, comply with federal and state
requirements and standards and maintain
expanded water and wastewater treatment
facilities. Funding also was added in the
Development Services Department
to address increased plan review and
permitting workload and maintain the
sign inventory.

The proposed budget was presented
at 15 budget hearings conducted
throughout the community from March 9
through March 25 to gain community
input. Special hearings were held for
youth, seniors and small businesses.
A slide show was presented at each
hearing describing the proposed budget,
after which residents were invited to
comment. In addition to the budget
hearings, the city communicated the
budget to the community through the
“Phoenix Budget for Community Review”
that outlined the proposed service
reductions and enhancements as well
as a calendar of budget hearing dates.
This publication was inserted in the
March 13 edition of The Arizona Republic
and delivered to 230,000 households.

A Spanish version of this publication has
been included in editions of Prensa
Hispana, La Voz and El Monitor. An insert
also was included in The Informant.
Copies of the inserts also were available
at various locations throughout the city.
Residents also were invited to send
comments and questions to Budget
and Research's Internet site.
A balanced 2005-06 budget was
presented to the Mayor and Council on
April 5. This budget included changes
based on the community input from the
budget hearings. Staff identified increased
resources totaling $1,069,000 to respond
to community concerns. These resources
included additional savings, increased
revenues, and savings from suspending the
Infill Housing program. The additional

resources were used to restore $145,000 in
planned reductions for parks maintenance
and $264,000 for general recreation
programming. Some of the planned bus
route reductions were restored with
$167,000. In addition, $383,000 was
allocated to continue the Senior Services
East and Shadow Mountain Senior centers.
Finally, $105,000 was allocated to restore
the prosecutor assigned to handle
inspection cases from Neighborhood
Services and Development Services.
With these changes, the recommended
2005-06 budget included reductions
totaling $15.4 million and the elimination
of 92.9 jobs. With the exception of the
Police and Fire departments which were
cut by .9 percent, most general-funded
department budgets were reduced by
2.6 percent.

C om m u n it
y m em be rs
a re gi ve n
bu d ge t be fo
th e op p or
re it is a d
tu n it y to co
op te d by th
a bo u t th e
m m en t on
e P h oe n ix
P ro p os ed
a ba la n ce
C it y C ou n
B u d ge t w a
A ri zo n a In
d
ci l. A n ew
s d is tr ib u te
fo rm a n t, a
sp a p er in
d in T h e A
n d a Sp a n
L a Vo z a n
se rt
ri zo n a R ep
is h ve rs io n
d E l M on it
u bl ic a n d
w a s in cl u
or.
d ed in P re
n sa H is p a
na,

43

Tentative Budget Adoption - June 1
2005-06 Budget Calendar
A public hearing and tentative budget
adoption were held on June 1 in
compliance with the Charter requirement
that the budget be adopted no later than
June 30. Upon tentative adoption, the
budget becomes the City Council’s program
of services for the ensuing fiscal year. At
this point, the Council may later decrease
the budget, but only in certain instances
may the budget be increased. Generally,
the ability to increase the budget applies
to expenditures exempted from the state
expenditure limitation. Transfers between
department appropriations are still
permissible before the final budget
is adopted.

Final Budget Adoption - June 15
A public hearing and final adoption were
conducted on June 15. Adoption of the
property tax levy was scheduled no less
than 14 days later, on July 1 in accordance
with state law.
The following chart is an overview of
the 2005-06 budget calendar.

44

December 14

Early General Fund Budget Outlook and Calendar

February 1

General Fund Budget Status Report

March 8

2005-06 Proposed Balanced Budget

Week of March 13

Budget Inserts in Local Newspapers

March 9 - 25

Community Budget Hearings

April 5

2005-06 Proposed Budget and 2005-10 Preliminary
Capital Improvement Program presented to
the City Council

April 14

2001 Bond Committee Meeting

May 3

City Manager’s Recommended 2005-06 Budget
distributed to City Council

May 23

Budget Reductions Effective

June 1

Tentative Adoption of 2005-06 Budget and
2005-10 Capital Improvement Program

June 15

Final Budget Adoption

July 1

Property Tax Adoption

General Budget and Financial Policies

C

ity of Phoenix budget and financial
policies are governed by Arizona state law,
the City Charter and generally accepted
accounting standards. These laws and
standards set budget calendar dates,
provide for budget control, describe ways
to amend the budget after adoption,
and identify appropriate methods for
budgeting, accounting and reporting.
The Arizona Constitution establishes the
property tax system and sets tax levy and
assessed valuation limits. The constitution
also provides annual expenditure limits
and sets total bonded debt limits.
The city’s budget policies are
extensions of these basic laws and follow
generally accepted governmental
budgeting and accounting standards.

A BALANCED BUDGET IS REQUIRED
Arizona law (Title 42 Arizona Revised
Statutes) requires the City Council to
annually adopt a balanced budget by
purpose of public expense. State law
defines this balanced budget as “the
primary property tax levy, when added
together with all other available resources,
must equal these expenditures.”

Therefore, no General Fund balances
can be budgeted in reserve for subsequent
fiscal years. Instead, an amount for
contingencies (also commonly referred to
as a “rainy day fund”) is included in the
budget each year.
The City Charter also requires an
annual balanced budget. The Charter
further requires that “the total of proposed
expenditures shall not exceed the total of
estimated income and fund balances.”

Annual Budget Adoption
Requirements
The City Charter and state statutes
contain legal deadlines and actions that
must be followed in adopting the budget.
In cases where the deadlines conflict,
the city meets the earlier of the two dates.
The deadlines and formal actions
prescribed by both, as well as the actual
or planned dates for the 2005-06 budget
development process are as follows.

2005-06
Budget
Dates

Action Required

City Charter
Prescribed Deadline

Arizona State Statute
Prescribed Deadline

City manager’s
recommended
five-year Capital
Improvement Program
submitted to the
City Council

At least 3 months
prior to final date
for submitting
the budget or a date
designated by the
City Council.

Capital Improvement
Program not required.

April 5

City manager’s
proposed budget
for ensuing year
presented to the Mayor
and City Council.

On or before the
first Tuesday in
June or a date
designated by the
City Council.

City manager budget
not required.

April 5

Publish general
summary of budget
and notice of public
hearing that must
be held prior to
tentative budget
adoption.

Publish in
newspaper of
general circulation
at least two weeks
prior to first
public hearing.

No requirement.

Publish
week of
May 16

Publish notice of public
hearing which must be
held prior to adoption
of five-year Capital
Improvement Program
by resolution.

Publish in newspaper
of general circulation
at least two weeks
prior to first public
hearing.

No requirement.

Publish
week of
May 16

47

Action Required

Public hearing
immediately followed
by tentative budget
adoption with or
without amendment.

City Charter
Prescribed Deadline

On or before the
last day of June.

2005-06
Arizona State Statute Budget
Prescribed Deadline
Dates

On or before the
third Monday
of July.

June 1

Publish summary of
No requirement.
tentatively adopted
budget and notice of
public hearing which
must precede final
adoption. Publish
truth-in-taxation notice.

Once a week for two
consecutive weeks
following tentative
adoption.

Publish
weeks of
May 30,
June 6
and 13

Public hearing
No requirement.
including truth-intaxation hearing
immediately followed
by final budget adoption.

No later than second
Monday in August.

June 15

Property Tax Levy
Adoption.

No sooner than 14
days following final
budget adoption and
no later than the
third Monday in
August.

July 1

No later than the
last regularly
scheduled Council
meeting in July.

If funds are available, appropriations
may be increased for certain funds
specifically excluded from the limitations
in the Arizona Constitution. These funds
are bond proceeds, Arizona Highway User
Revenue, debt service and grants. At the
end of each fiscal year, the City Council
adopts an amendment to the budget
ordinance for any necessary increases in
these funds. These increases are largely
caused by federal grants that become
available throughout the fiscal year.
Finally, transfers of amounts within
any specific fund or General Fund program
can be made upon approval of the
city manager.

PROPERTY TAXES
AND BONDED DEBT LIMIT
Arizona’s property tax system provides
for two separate tax systems. A primary
property tax is levied to pay current
operation and maintenance expense.
Therefore, primary property tax revenue
is budgeted and accounted for in the
General Fund. A secondary property tax
levy is restricted to the payment of debt
service on long-term debt obligations.
Therefore, secondary property tax
revenue is budgeted and accounted for
as a Special Revenue fund.

Primary Property Tax Restrictions
Amendments to the Budget
After Final Adoption
Generally, by Arizona state statute, no
expenditure may be made nor liability
incurred for a purpose not included in the
budget even if additional funds become
available. The level of legal budgetary
control is by fund except for the General
Fund for which control is by program.
In certain instances, however, the
budget may be amended after adoption.
All budget amendments require City
Council approval. These are (1) transfers
from any contingency appropriation, (2)
increases in funds exempt from the

48

Arizona State Constitution expenditure
limit and (3) reallocations of amounts
included in the original budget. An
amount for contingencies is included in
the General Fund and in other restricted
funds. Informal reservations of
contingencies are made throughout the
fiscal year as approved by the City Council.
Actual expenditures are recorded in the
appropriate departmental budget. Then,
at the end of the fiscal year, contingency
amounts actually needed are transferred
by City Council formal action to the
appropriate departmental budget.

Primary property tax levies are restricted
to an annual 2 percent increase plus an
allowance for growth attributable to
previously unassessed properties
(primarily new construction). Growth in
primary assessed valuation is restricted
annually to the greater of 10 percent,
or 25 percent of the difference between
primary and secondary values, plus an
allowance for previously unassessed
properties. The City Charter requires
that 8 cents of the primary property tax
levy be allocated to the Parks and
Playground Fund.

Secondary Property Tax Restrictions
Secondary property tax levies are
restricted in their use to the payment
of annual debt service on long-term debt
obligations. Any over-collection of the
secondary levy or any interest earned by
invested secondary property tax funds
must be used to reduce the following year’s
levy. No restrictions limit the annual
growth in secondary assessed valuations.
Secondary assessed valuations are
intended, therefore, to follow general
market conditions.
Generally, Arizona counties assess
property and collect all property taxes.
Proceeds are distributed monthly to the
appropriate jurisdictions.

Bonded Debt Limit
Arizona cities can issue general obligation
bonds for purposes of water, sewer,
artificial light, open space, preserves,
parks, playgrounds and recreational
facilities up to an amount not exceeding
20 percent of the secondary assessed
valuation. General obligation bonds can
be issued for all purposes other than those
previously listed up to an amount not
exceeding 6 percent of the secondary
assessed valuation. An analysis of bonded
debt limits is provided in the Debt Service
and Lease Purchase chapter.

ANNUAL EXPENDITURE LIMITATION
Since fiscal year 1982-83, the city of
Phoenix has been subject to an annual
expenditure limitation imposed by the
Arizona Constitution. This limitation is
based upon the city’s actual 1979-80
expenditures adjusted for interim growth
in population and inflation as measured
by the gross domestic product implicit
price deflator.

The constitution exempts certain
expenditures from the limitation.
The principal exemptions for the city
of Phoenix are debt-service payments,
expenditures of federal funds, certain
state-shared revenues and other long-term
debt obligations. Exemptions associated
with revenues not expended in the year
of receipt may be carried forward and used
in later years. The 1979-80 expenditure
base may be adjusted for the transfer
of functions between governmental
jurisdictions.
The constitution provides for four
processes to exceed the expenditure
limitation: (1) a local four-year home rule
option, (2) a permanent adjustment to
the 1979-80 base, (3) a one-time override
for the following fiscal year, and (4) an
accumulation for pay-as-you-go capital.
All require voter approval.
City of Phoenix voters have approved
six local home rule options in 1981, 1985,
1991, 1995, 1999 and 2003. Before 1999,
the home rule options generally excluded
enterprise operations such as Aviation,
Water, Wastewater and Solid Waste from
the expenditure limitation. In 1999,
and again in 2003, the voters approved
establishing the city’s annual budget as
the spending limit. The current home
rule option is in effect through fiscal year
2007-08. Finally, in 1981, the voters
approved the permanent annual exclusion
of the following amounts for pay-as-you-go
capital: $5 million for Aviation, $6 million
for Water, $6 million for Wastewater and
$2 million for General Fund street
improvements.
Each year, the city uses only those
exemptions needed to comply with the
expenditure limitation. Exemptions not
needed are carried forward to future years
and used for future spending capacity.

BUDGET BASIS OF ACCOUNTING
The city’s budget basis of accounting
differs from generally accepted accounting
principles (GAAP) used for preparing the
city’s comprehensive annual financial
report. The major differences between
the budget basis and GAAP basis are listed
below. A reconciliation of budgetary and
GAAP fund balances is provided each
year in the Comprehensive Annual
Financial Report.

1. For budgetary purposes, encumbrances
(contractual commitments to be
performed) are considered the
equivalent of expenditures rather than
as a reservation of fund balance.
2. Grant revenues are budgeted on a
modified cash basis. GAAP recognizes
grant revenues on an accrual basis.
3. Fund balances reserved for inventories,
bonded debt and unrealized gains or
losses on investments are not
recognized in the budget.
4. In-lieu property taxes and central
service cost allocations (levied against
certain enterprise and special revenue
funds) are budgeted as interfund
transfers rather than revenues
and expenses.
5. For budgetary purposes, all fixed assets
are fully expensed in the year acquired.
The differences between budgetary
and GAAP accounting listed above are
similar to those of many other local
governments. These differences exist
largely because they provide a more
conservative view of revenues and
expenditures and because they provide
greater administrative controls.

49

GENERAL FINANCIAL POLICIES
In addition to the legal constraints
outlined in the previous section, a
number of administrative and City
Council-approved policies provide
guidance and direction to the budget
development process.

Form of Budget Adoption
1. Ordinances - Three budget
ordinances are adopted each fiscal
year: (1) the operating funds
ordinance, (2) the capital (bond)
funds ordinance and (3) the
re-appropriated funds ordinance.
The last ordinance is required because
unexpended amounts, including those
encumbered, lapse at the end of the
fiscal year. Since all expended
amounts must be included in the
budget adoption ordinance, the city
re-budgets all encumbrances
outstanding at year-end.

2. Allocation of Appropriations Funds appropriated by the City Council
are allocated to programs, offices,
departments, divisions, sections,
projects, and type of expenditure by
the city manager or as delegated to the
Budget and Research director to
provide managerial control and
reporting of budgetary operations.

50

3. Contingency Amounts A contingency allowance (also known
as a “Rainy Day Fund”) is appropriated
to provide for emergencies, mid-year
community service requests,
unanticipated expenditures and
revenue shortfalls. Expenditures may
be made from contingencies only upon
approval by the City Council with
recommendation by the city manager.
In 1995-96, the City Council adopted
a policy to provide a contingency equal
to 3 percent of operating expenditures
in the General Fund. However, in
2003-04, the City Council reduced the
General Fund contingency to 2.5
percent of operating expenditures in
order to close a budget deficit. In the
2004-05 budget, the contingency fund
was increased to 2.6 percent of
operating expenditures. The 2005-06
budget maintains the General Fund
contingency at 2.6 percent of
operating expenditures.
Enterprise and Special Revenue funds
have varying levels of contingency
funding consistent with the variability
in revenues and expenditures
associated with the services provided.

4. Budget Controls - At the department
level, control of expenditures is
governed by Administrative Regulation.
City departments prepare revised
expenditure estimates twice a year.
The Budget and Research Department
keeps the city manager and the City
Council advised on the status of the
budget through periodic budget status
reports. Mid-year revenue shortfalls
and/or expenditure increases can result
in the adoption of mid-year
expenditure reductions.

Cost Allocation
and Expenditure Policies
1. Central Services Cost Allocation The Finance Department annually
calculates the full cost of central
services provided to enterprise funds.
Except for the Golf Fund, these
allocated costs are recouped from the
enterprise funds through fund transfers
to the General Fund.

2. Administrative Cost Recovery The Finance Department prepares an
indirect cost allocation plan that
conforms to federal guidelines for grant
reimbursement of appropriate
administrative costs. The allocated
costs are charged to eligible federal
grant funds through a fund transfer
to the General Fund.

3. Internal Cost Accounting
Allocation - Interdepartmental
services performed by one department
for another are credited to the
performing department and charged
to the receiving department to reflect
the accurate costs of programs.
The rates used are intended to reflect
full costs.

4. Enterprise Cost Recovery Aviation, Water, Wastewater and Solid
Waste are fully self-supporting from
rates, fees and charges and, as such,
are budgeted and accounted for as
Enterprise Funds. Cost recovery
includes direct operation and
maintenance expenses, capital
expenditures, debt service, indirect
cost allocation, and in-lieu property
taxes, where allowable. The Civic
Plaza, while accounted for using
enterprise accounting principles, is
partially financed from rental and
parking fees with the remainder
coming from earmarked sales taxes.

The Golf Fund, also accounted for
using enterprise accounting principles,
does not reimburse the General Fund
for citywide indirect cost allocations.
Finally, federal regulations preclude
the Aviation Fund from paying in-lieu
property taxes. By City Council policy,
the Civic Plaza Fund does not pay
in-lieu property taxes.

5. Employee Compensation Costs Costs for employee compensation
including all wages, social security,
industrial, health, life, unemployment,
dental insurance and other personal
allowances are allocated to each
department. The future values of
compensated absences are not
included in the budget but are
disclosed in the notes to the
Comprehensive Annual Financial
Report at year’s end. Annual amounts
for cash conversion of vacation,
compensatory time and sick leave
are included in the budget.

6. Pension Funding - In addition to
other employee compensation amounts,
pension amounts are allocated to each
department. The required employer
contribution is determined actuarially
to fund full benefits for active members
and to amortize any unfunded actuarial
liability as a level percent of projected
member payroll over 20 years from the
end of the current fiscal year.

7. Self-Insurance Costs - With a few
exceptions, the city is fully self-insured
for general and automotive liability
exposures. The major exceptions to
self-insurance include airport
operations, police aircraft operations
and excess general and automotive
liability for losses in excess of $5
million. An independent actuary
determines the self-insurance costs,
which are combined with purchased
policy costs and allocated to
department budgets based on the
previous five years’ loss experience
of each department.

8. Maintenance and Replacement of
Rolling Stock and Major Facilities A multiyear plan is used to project the
need for, and costs of, significant street
pavement, facility and equipment
repair and replacement. The planning
horizon for each asset category is
matched to the life of the asset.
Annually, that plan, combined with
periodic physical inspections of streets,
facilities, vehicles and other
equipment, is used to develop funding
levels for inclusion in the budget.
During economic downturns, these
amounts are debt-financed with a
repayment schedule shorter than the
expected life of the asset.

Revenue Management
All local governments struggle to generate
the funds necessary to provide, maintain
and enhance the service demands of their
community. Due to the legal limitations
on property taxes in Arizona, and due to
the pre-emption of city-imposed income,
luxury and gas taxes, Arizona cities and
towns largely rely on local sales taxes and
state-shared sales, income and vehicle
license taxes. In Phoenix, 40 percent of
the General Fund comes from the local
sales tax. This reliance on sales tax
collections results in a highly cyclical
revenue base.
Given our reliance on sales taxes,
developing personal income is an
important step in managing our revenue
base. In recent years, considerable effort
has been devoted to attracting employers
that will provide our residents with quality
jobs and to developing a local workforce
that will support the needs of quality
employers. We have also worked to
develop an employment base that is not
as heavily concentrated in the highly
cyclical construction industry.
Also important to managing our
revenue base is the future growth
expected in catalog and Internet sales.
Our Use Tax is an important tool in
reducing this potential future threat.
The development of our tourism-related
sales tax base (hotels, restaurants and
short-term car rentals) is another
important hedge against future revenue
loss due to growth in Internet and
catalog sales.
Finally, utility taxes that are levied
against the sales of electricity, natural gas,
telecommunications, water and sewer
make up about 21 percent of our local
sales tax base. Generally, utility taxes are
not responsive to economic conditions and
provide us with a fairly significant revenue
source that remains stable during periods
of economic downturn.

51

In addition, several detailed revenue
policies are listed below.

1. City Sales and Use Taxes
(Privilege License Taxes) - The City
Council may set the city sales tax rate
by ordinance. The city sales tax rate on
retail sales and most other categories is
1.8 percent. The rate varies for certain
other specialized taxing categories as
outlined in the Operating Fund
Revenues section of this document.

2. Property Taxes - By City Council
policy, the combined city property tax
rate is $1.82 per $100 of assessed
valuation. The primary property tax
levy is annually set at the previous
year’s levy amount plus an amount
associated with new construction and
an amount to partially provide for the
operating costs of new capital facilities.
The secondary levy is then set at an
amount necessary to achieve a total
$1.82 tax rate.

3. In-Lieu Property Taxes In-lieu property taxes are charged to
the Water, Wastewater, Solid Waste and
Public Housing funds based upon
acquisition or construction cost with
the appropriate assessment ratio and
current property tax rate applied.
These amounts are calculated annually
by the Finance Department.

4. Annual User Fee Review The city auditor conducts a
comprehensive user fee review to
project cost recovery rates, and then
compares the projections to the
established cost recovery policy.
The rates are based upon generally
accepted full-cost accounting
standards. The city manager
recommends expenditure reductions
or fee adjustments to the City Council
to maintain the established cost
recovery policy.

52

5. Fines and Forfeitures The Municipal Court has jurisdiction
over establishing many of the fine and
forfeiture fee schedules.

6. Parks and Recreation Fees
and Charges - The Parks and
Recreation Board has jurisdiction over
establishing charges for miscellaneous
recreational facilities and advising the
City Council on fees to be set for golf
courses, tennis centers and swimming
pools.

7. Interest Earnings - Interest earnings
from the investment of temporarily idle
funds are credited to the fund
generating the earnings.

Library – State law requires that funds
received for library purposes be segregated
in a separate library fund. Revenues
include library fines and fees, which are
used to help offset library expenditures.
Cable Communications – Included in this
fund are the revenues and expenditures
associated with administering cable
television licensing and programming
the government and education access
channels.
Special Revenue Funds
Excise Tax – The excise tax fund is used
to account for tax revenues ultimately
pledged to pay principal and interest on
various debt obligations.

FUND STRUCTURE
The budget presented here is made up
of three distinct fund groups: General,
Special Revenue and Enterprise funds.
All planned uses of these fund types
are included in the annual budget.
Fiduciary funds, which are described later
in this section, are not included in the
annual budget.

General Funds
General – These revenues come from
four major sources: local sales (privilege
license) taxes, local primary property
taxes, state-shared revenues, and user fees
and other revenues. State-shared taxes
include state-shared sales, vehicle license
and income taxes. User fees and other
revenues include cable and ambulance
fees as well as interest earnings and fines.
General funds are used to provide the
most basic of city services: police, fire,
parks, library, municipal court and
neighborhood services.
Parks and Recreation – The City Charter
requires that a portion of the primary
property tax levy be used to support Parks
programs. To demonstrate compliance
with this requirement, all Parks revenues
and expenditures are segregated in a
separate fund.

Police and Fire Neighborhood
Protection – These funds are used to
account for the revenues and expenditures
associated with a voter approved 0.1
percent increase in the sales tax in 1993.
Revenue from the tax increase is
earmarked for police and fire
neighborhood protection programs,
and police Block Watch programs.

Police and Fire Public Safety
Enhancement – These funds are used to
account for the revenues and expenditures
associated with a voter approved 2.0
percent increment of the 2.7 percent
privilege license (sales) tax on utilities
with franchise agreements in March 2005.
The Police Department, including the
Office of Emergency Management will be
allocated 62 percent and the Fire
Department 38 percent of revenues
with the interest earnings going to the
General Fund.

Parks and Preserves – This fund is used
to account for the funds generated by
the 0.1 percent increase in the sales tax
approved by voters in 1999. The funds are
to be used for the purchase of state trust
lands for the Sonoran Desert Preserve
Open Space, and the development and
improvement of regional and neighborhood
parks to enhance community safety and
recreation.

City Improvement – This fund is used to
account for lease/purchase payments
incurred as a result of facilities built by
the Civic Improvement Corporation.
Capital Construction – This fund is used
to account for the utility taxes (2 percent)
on telecommunication services that are to
be used for pay-as-you-go capital projects.

Transit 2000 – This fund is used to
account for the 0.4 percent sales tax
dedicated to transit approved by voters
on March 14, 2000. Also included in this
fund are fare box collections and DASH
(Downtown Area SHuttle) revenues.

Development Services – Fee revenues and
expenditures associated with permitting
and inspection services provided by the
Development Services Department are
maintained in this fund.
Court Awards – This fund includes
revenue resulting from court awards
of confiscated property under both the
federal and state Organized Crime Acts.
Expenditures are restricted to additional
law enforcement programs in the Police
and Law departments.

Secondary Property Tax and
General Obligation Bond Redemption –
In Arizona, property taxes are divided
into two separate levies: primary and
secondary. The primary levy can be used
for general operating and maintenance
expense. The secondary levy can only be
used for payment of general obligation
bond interest and redemption. Because
of this restriction, secondary property
tax funds are segregated in a Special
Revenue fund.

Arizona Highway User Revenue (AHUR)
– AHUR funds are made up of state-collected gas taxes and a portion of other
state-collected fees and charges such as
registration fees, driver’s licenses and
motor carrier taxes. These funds can
only be used for street maintenance
and construction, and street-related
debt service.

Local Transportation Assistance (LTA) –
This fund includes the Phoenix share of
Arizona State Lottery proceeds distributed
to cities and towns. These funds are to be
used for mass transit operating and capital
expenses. In addition, if $23 million is
distributed, then up to 10 percent may be
used for cultural, educational, historical,
recreational, or scientific facilities or
programs. LTA funds used for non-transit
purposes must be matched on a 50/50
basis with non-public cash.

Sports Facilities – This fund accounts
for revenues generated from a 1 percent
hotel/motel tax and a 2 percent tax on
short-term vehicle rentals. These funds
are designated for payment of debt service
and other expenditures related to the
downtown sports arena.

Public Transit – This fund is used to
account for transit services that are paid
by and provided for other cities or funded
by the Regional Public Transportation
Authority.

Community Reinvestment – Revenues and
expenditures associated with economic
redevelopment agreements are maintained
in this fund.
Other Restricted Funds – This is a
combination of funds used to segregate
restricted revenues and related expenses.
Included are Court Technology
Enhancement Fees, Parks revenues
such as Heritage Square and Tennis
Center, and various other receipts and
contributions received in small amounts
and earmarked for restricted purposes.

Grant Funds – Grant funds include
Community Development Block Grant
funds, Public Housing funds, Human
Services funds and various other smaller
grant allocations. Grant funds can be
applied only to grant-eligible expenditures.

Enterprise Funds
Enterprise funds include Water,
Wastewater, Aviation, Solid Waste, Golf
and Civic Plaza funds. With the exception
of Civic Plaza funds, these funds come
entirely from the fees and rents paid by
those who use the services and facilities
provided. Enterprise funds are
“self-contained” and can only be used
to pay for the costs associated with
Enterprise fund-related services and
programs. Therefore, fees are set to
recover all costs associated with providing
these services. These costs include
day-to-day operations and maintenance,
in-lieu property taxes, pay-as-you-go
capital improvements and debt service.
Civic Plaza funds come from a
combination of rental and parking income
and earmarked sales taxes. These
earmarked taxes include a portion of the
hotel, restaurant and bar, construction
contracting and advertising taxes levied
by the city. This tax stream has been
earmarked to repay the debt issue for
the Civic Plaza facility and to provide for
operations and maintenance costs.

Fiduciary Funds
Fiduciary funds, including trust and
agency funds, represent funds held for
others. As such, these funds are not
included in the annual budget. Also,
reserves and expenditures for fiduciary
funds are not presented in the
comprehensive annual financial report
(CAFR). However, the year-end balances
held in fiduciary funds are provided in
the CAFR.

53

Revenue Estimates

R

evenue estimates for 2005-06 are based
on assumptions about the local economy
and population changes, on underlying
cost estimates for cost-recovery rates and
fees, and on the continuation of current
state revenue collection and sharing
practices. Adjustments to fees, such as
those for water and sewer service, are
established in separate planning processes
and are incorporated in these estimates.
In addition, other revenue estimates
are developed using the most current
information from outside entities that
establish such fees. Examples of revenues
derived from fees set by outside entities

include portions of court fines and fees
and ambulance fees. Finally, the revenue
estimates reflect an approved adjustment
to property tax revenues. The primary
property tax levy, which is a General
fund revenue, has been increased by
approximately $5 million to the maximum
allowable and is offset by a like reduction
in the secondary property tax levy.
The current $1.82 property tax rate
will remain the same.
The state and local economy began to
recover in late 2002-03 and that recovery
continued in 2003-04. It is assumed that
recovery growth rates will continue

through early 2004-05, and then stabilize
for the balance of the year. Personal
income is a major driver for estimating
state and local sales taxes and
state-shared income taxes. Consistent
with projections by local economists, the
chart below shows that personal income
is expected to grow by 7.5 percent in
2005-06, down from the 7.9 percent
estimated for 2004-05.
In non-General Fund revenues, the
2005-06 estimates for Water, Wastewater
and Solid Waste systems reflect full year
impacts of 2004-05 fee increases.

Personal Income Growth
12%

11.1%

10%

$

8%

10.4%

$
$

8.0%

$

6%

7.9%
6.7%

6.5%

$

$

4%

5.8%
4.6%

4.3%

$

$

$

7.5%

$

$

2%
0%
1996-97

1997-98

1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

Fiscal Year

55

GENERAL REVENUES BY MAJOR SOURCE
(In Thousands of Dollars)
Revenue Source

2003-04
Actuals

% of
Total

2004-05
Estimate

% of
Total

2005-06
Estimate

% of
Total

Increase/(Decrease)
from 2004-05 Est.
Amount
Percent

$332,906
2,234

42.1%
0.3

$357,959
2,350

42.4%
0.3

$386,880
2,350

42.0%
0.3

$28,921)
_)

8.1%
0.0

$335,140

42.4%

$360,309

42.6%

$389,230

42.2%

$28,921)

8.0%

Local Taxes
Sales Tax
Privilege License Fees
Subtotal

State-Shared Revenues
Sales Tax
State Income Tax
Vehicle License Tax
Subtotal
Primary Property Tax

111,594
119,118
53,522
$284,234

14.1
15.1
6.8
36.0%

122,554
121,470
57,100
$301,124

14.5
14.4
6.8
35.6%

134,822
138,455
60,765
$334,042

14.6
15.0
6.6
36.2%

12,268)
16,985)
3,665)
$32,918)

10.0
14.0
6.4
10.9%

76,392

9.7

83,304

9.9

91,311

9.9

8,007)

9.6

2,650
8,257
17,873
839
2,798
21,072
1,038
995
4,038
23,013
11,084
2,267
16,058
2,468

0.3
1.0
2.3
0.1
0.4
2.7
0.1
0.1
0.5
0.4
1.4
0.3
2.0
0.3

2,496
8,529
18,883
928
1,752
26,692
1,300
1,024
3,358
1,444
11,477
2,618
17,165
2,486

0.3
1.0
2.2
0.1
0.2
3.2
0.2
0.1
0.4
0.2
1.4
0.3
2.0
0.3

2,496
8,785
20,070
1,079
2,529
30,153
1,325
1,673
3,467
1,471
11,536
1,636
19,886
1,473

0.3
1.0
2.2
0.1
0.3
3.3
0.1
0.2
0.4
0.2
1.3
0.2
2.2
0.2

_)
256)
1,187)
151)
777)
3,461)
25)
649)
109)
27)
59)
(982)
2,721)
(1,013)

0.0
3.0
6.3
16.3
44.4
13.0
1.9
63.4
3.2)
1.9
0.5
(37.5)
15.9
(40.8)

Subtotal

$94,450

12.0%

$100,152

11.9%

$107,579

11.7%

$7,427)

7.4%

TOTAL GENERAL FUND

$790,216

100.0%

$844,889

100.0%

$922,162

100.0%

$77,273)

9.1%

User Fees/Other Revenues
License & Permits
Cable Communications
Fines & Forfeitures
Court Default Fee
Engineering & Architectural Services
Fire
Hazardous Materials Inspection Fees
Library Fees
Parks & Recreation
Planning
Police
Street Transportation
Other Service Charges
All Others

56

GENERAL FUNDS
Total 2005-06 General Fund revenues
are estimated to be $922.2 million or
9.1 percent more than 2004-05 estimates
of $844.9 million. General Fund revenues
consist of four major categories: local
taxes, state-shared revenues, primary
property taxes and user fees. Following
are descriptions of the revenue sources
within these four categories and
explanations of 2005-06 revenue estimates.

Local and state sales tax collections
represent approximately 57 percent of
General Fund revenues. Local and state
sales tax collections for 2005-06 are
expected to grow by 8.5 percent over the
2004-05 estimates. This is a slight
increase from the 8.1 percent growth
rate anticipated in 2004-05; however,
as shown in the chart below, the growth

Local and State Sales Tax
Revenue Growth

10%
8%

rates for both years are significantly
higher than those experienced over the
past four years.
The table on the opposite page details
estimated General Fund revenues by
major category.

7.8%

8.1%

8.0%

8.5%

6.2%
6%
3.3%

4%
2%

0.3%
0%
-0.5%

-2%
1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

Fiscal Year

57

LOCAL SALES TAXES AND FEES
This major revenue category consists of
various local sales taxes, privilege license
fees, use tax, and franchise taxes and fees.
The 2005-06 estimate is $389.2 million,
which is $28.9 million or 8.0 percent
greater than the 2004-05 estimate of
$360.3 million. The assumptions used
to estimate local sales taxes follow.

GENERAL FUNDS
Total Revenues – $922.2 Million
Local
Sales Tax
42.2%

Local Sales Tax
The city of Phoenix’s local sales tax
consists of 15 general categories that
are collected based on a percentage of
business income accruing in each category.
To protect local businesses, Phoenix also
levies a use tax on purchases where
no sales taxes were paid. Finally, two
additional local taxes are collected based
on water service accounts.
Of the 15 categories collected as
a percentage of income, all except
advertising provide General Fund
resources. All but advertising and utilities
contribute voter-approved resources for
police and fire, parks and preserves, and
transit programs. Portions of several
categories and the entire advertising

category are restricted to the Civic Plaza
fund and/or the Sports Facilities fund.
Beginning in May 2005, utilities sales tax
collections will be directed to the general
fund as well as the newly established
Public Safety Enhancement fund.
Finally, an additional 2 percent tax on
the telecommunications category provides
resources for the Capital Construction
fund. The table below provides a listing
of the local sales tax categories, indicating
the specific tax rates for each fund and
the total tax rate for each category.

The General Fund portion of the local
sales tax estimate is $389,230,000 for
2005-06. This is an increase of $28,921,000
or 8.0 percent from the 2004-05 estimate
of $360,309,000. The increase in local
sales tax revenue is based on estimated
growth of 7.6 percent in the retail sales
category, and reflects the economy’s
continuing improvement. Projected
increases in other categories include
13.2 percent for utility and franchise
which takes into account rate increases
for APS, SRP, Water and Wastewater;

CURRENT LOCAL SALES TAX RATES BY CATEGORY
General
Fund
Advertising
Contracting
Job Printing
Publishing
Transportation/Towing
Restaurants /Bars
Leases/Rentals/Personal Property
Short-Term Motor Vehicle Rental
Commercial Rentals
Lodging Rentals Under 30 Days
Lodging Rentals 30 Days and Over
Retail
Amusements
Utilities
Telecommunications

Neighborhood Public Safety
Protection Enhancement

_

_

0.7%
0.7%
0.7%
0.7%
0.7%
1.2%
1.2%
1.3%
1.2%
1.2%
1.2%
1.2%
2.7% *
2.7%

0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
_
_

_
_
_
_
_
_
_
_
_
_
_
_
_
2.0%**
_

Parks &
Preserves

Transit
2000

Civic
Plaza

Sports
Facilities

Capital
Construction

_

_

0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
0.1%
_
_

0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
0.4%
_
_

0.5%
0.5%
0.5%
0.5%
0.5%
0.5%
_
_
_

_
_
_
_
_
_
_
2.0%
_

2.0%
_
_
_
_
_

1.0%
_
_
_
_
_

_
_
_
_
_
_
_
_
_
_
_
_
_
_

* The General fund portion of the utilities category includes the 2.0% franchise fee paid by utilities with a franchise agreement.
** The Public Safety Enhancement designated 2.0% sales tax applies only to those utilities with a franchise agreement.

58

2.0%

Total
0.5%
1.8%
1.8%
1.8%
1.8%
1.8%
1.8%
3.8%
1.9%
4.8%
1.8%
1.8%
1.8%
4.7%
4.7%

7.2 percent for commercial rentals;
6.4 percent for restaurants and bars;
and 7.7 percent for hotel/motel
room rentals.
As shown in the pie chart to the
right, the retail category represents
approximately 43 percent of the General
Fund sales tax. Personal income growth,
which is used as a trend indicator for
retail sales activity, is projected at 7.5
percent for 2005-06. Overall, sales tax
growth tends to follow a growth pattern
similar to personal income growth.
General fund sales tax revenue is
collected on three rental categories:
Leases and Rentals of Personal Property,
Commercial Real Property Rentals and
Apartment Rentals. For 2005-06, these
categories are expected to increase
2.9 percent, 7.2 percent and 5.0 percent
respectively. These three categories
combined are approximately 17 percent
of General fund sales tax revenue.
The contracting category is expected
to increase by 16.7 percent. The city has
experienced tremendous growth rates in
this category over the past several years,
led by booming residential construction.
The expected 2004-05 growth is 27.2
percent. For 2005-06, indicators for job
creation and population growth predict
that residential construction activity will
continue, but at a slightly slower rate.
This slowing, however, will be offset by
significant commercial construction
projects such as the Civic Plaza expansion
and Light Rail. This category represents
approximately 8 percent of the General
fund sales tax revenue.
The restaurants and bars category
is expected to increase 6.4 percent and
the hotel/motel category is expected to
increase 7.7 percent in 2005-06. These two
categories, combined with revenue from
short-term motor vehicle rentals, are
closely related to tourism activity and
continue to benefit from the rebounding
tourism industry. Revenues from these
tourism-related activities represent
approximately 7 percent of General
Fund sales tax revenue.

GENERAL FUNDS
Local Sales Taxes

Various Leases
and Rentals
17%

Retail 43%

Tourism-related
7%
Contracting
8%

Other 4%
Utility
& Franchise
21%

The utility tax category is
approximately 21 percent of General Fund
sales tax revenue. The category includes
electricity, natural and artificial gas,
water consumption, sewer service and
communications activities. The 2005-06
estimate for utility sales and franchise
tax revenue is $80,649,000, which is an
increase of 9.6 percent over the 2004-05
estimate. The large increase is due to
rate increases for APS, SRP, Water and
Wastewater.
A use tax is assessed on the purchase
of tangible personal property, which is
stored, used or consumed within the city,
and for which a local sales tax has not
been paid at an equivalent rate to the
city of Phoenix rate. The tax also applies
to items purchased for resale and
subsequently used or consumed in the
business. The 2005-06 estimate of
$12,895,000 for use tax is 5.5 percent or
$675,000 more than the 2004-05 estimate.
This category is subject to variation in
purchasing practices, as well as economic
drivers. The use tax category is
approximately 3 percent of General
Fund sales tax revenue.
The following table shows General
Fund sales tax collections since 2001-02.
The amounts shown exclude the two utility
tax items that are collected based on water
service accounts.

A portion of the utility sales tax is
based on water service accounts. The first
was implemented on Oct. 1, 1990.
The 2005-06 estimate of $6,244,000 for this
category is 2.2 percent higher than the
2004-05 estimate of $6,110,000. The
second provides funding for storm water
management programs required by the
Environmental Protection Agency. The
2005-06 estimate of $1,251,000 for this tax
is 2.2 percent greater than the 2004-05
estimate of $1,224,000. This increase
provides for modest growth in accounts.

GENERAL FUND SALES TAXES
(In Thousands of Dollars)
Fiscal Year

Revenues

% Change From
Previous Year

2001-02

$307,741

2002-03

307,699

0.0

2003-04

325,547

5.8

2004-05 (Est.)

350,485

7.7

2005-06 (Est.)

379,245

8.2

0.1%

59

Privilege License Fees
The city charges a $16 fee to process an
application for a privilege tax license and
assesses a $50 annual fee for existing
licenses. These fees are intended to
recover the costs associated with
administering a fair and efficient sales
tax system. This category also includes a
$50 annual fee on each apartment complex
for non-transient lodging. The 2005-06
estimate for privilege license fee revenue
of $2,350,000 represents no change from
the 2004-05 estimate. Historically, the
net change in the number of licensed
businesses is small.

GENERAL FUNDS
Total Revenues – $922.2 Million
State-Shared
Revenue
36.2%

STATE-SHARED REVENUES
This major revenue category consists of
the city’s share of the state sales tax, the
state income tax and vehicle license tax.
The 2005-06 estimate for this category is
$334.0 million, which is $32.9 million or
10.9 percent more than the 2004-05
estimate of $301.1 million. The increase
is mainly due to the projected growth rates
of 10.0 percent in state-shared sales taxes
and 14.0 percent in state-shared income
taxes. The increase in the income tax
collections reflects personal and corporate
income growth in 2002-03. State-shared
vehicle license tax revenue for 2005-06
is estimated to grow at 6.4 percent over
the 2004-05 estimate.

State Sales Tax
The state sales tax rate on most taxable
activities is 5.6 percent with several
relatively minor categories having tax
rates ranging from 2.5 percent to 5.5
percent. The revenues are split between
a “distribution base,” of which Phoenix
receives a share, and a “combined
non-shared” category, which is allocated
entirely to the state. With exceptions
for some categories, the distribution base
consists of 40 percent of collections.
The 0.6 percent education tax included
in the total tax rate is not included in
any distribution base.

60

Under the current formula,
incorporated cities receive 25 percent of
the distribution base. These funds are
distributed to individual cities on the basis
of relative population percentages.
Phoenix’s share of the distribution to cities
for 2005-06 is estimated at 32.6 percent.
The city of Phoenix’s share of the state
sales tax for 2005-06 is expected to be
$134,822,000, which is $12,268,000 or
10.0 percent more than the 2004-05
estimate of $122,554,000. This estimate

is based on the assumption that, similar to
the local economy, the state economy will
continue to improve. At the state level,
retail sales are anticipated to increase
about 9.6 percent over the current fiscal
year. The table below shows the cities’
share of state sales taxes, Phoenix’s
allocation and annual increases since
2001-02. The population factor changes
with decade or mid-decade census
counts and periodic adjustments made
throughout the year.

________________________________________________________________________
STATE SALES TAXES

(In
Thousands of Dollars)
________________________________________________________________________
Cities’ Share of
Phoenix’s Share
State
Collections
__________________
______________________________
Fiscal Year
Total
% Change
Percent
Amount
% Change
________________________________________________________________________
2001-02
2002-03
2003-04
2004-05 (Est.)
2005-06 (Est.)

312,426
316,406
340,536
372,080
410,523

0.1
1.3
7.6
9.3
10.3

32.7*
32.7
32.6**
32.6
32.6

102,211
103,409
111,594
122,554
134,822

(3.0)
1.2
7.9
9.8
10.0

*Impact of 2000 census population changes.
**The adjustment to the percentage is due to a correction made to the 2000 Census
population amount of another Arizona city.
________________________________________________________________________

State Income Tax
Beginning in 1973, cities in Arizona shared
15 percent of the actual state personal and
corporate income tax collected two years
earlier. Individual cities received their
portion based on the cities’ share of the
state population. In 1990, legislation
lowered the cities’ share of the state
income tax to 12.8 percent beginning in
the 1992-93 fiscal year. Then in 1994,
legislation raised the percentage to 13.6
percent beginning in 1996-97, and 1996
legislation raised the percentage back to
15 percent for the 1997-98 and 1998-99
fiscal years. Legislation in 1997 provided
for a 15.8 percent share for the 1999-2000
fiscal year. In the 1999 legislative session,
the formula was again reduced to a 15
percent share beginning in 2000-01. Until
the 1999 legislative action, these changes
were enacted by the state in conjunction
with revisions to the individual and
corporate state income tax in order to
keep the cities’ share of rate and other
changes revenue-neutral. The 1999
change did not hold cities harmless.
Legislation in 2002 reduced the formula
to a 14.8 percent share for 2002-03 and
2003-04 only, as part of the effort to
reduce the anticipated shortfall in the
state budget. The formula reverted to a
15 percent share in 2004-05. The 2005-06
estimate is based on a 15 percent share.
The portion of the state income tax,
which will be distributed to cities and
towns in 2005-06, is expected to be
$425.2 million. The distribution represents
actual individual and corporate income
tax collections by the state in the 2003-04
fiscal year. The anticipated $425.2 million
is a 14.0 percent increase from the
previous fiscal year. The large increase is
a result of increased personal income and
corporate profits as well as extremely low
collections in the previous year. The city
of Phoenix’s portion of the state income
tax is estimated to be approximately 32.6
percent of the 15 percent share distributed
to cities. This equates to $138,455,000 for

2005-06 and is an increase of $16,985,000
or 14.0 percent from the 2004-05 estimate
of $121,470,000.
The table below shows the total cities’
share of state income tax, Phoenix’s share,
percentage allocation and annual increase
since 2001-02. Similar to sales tax sharing,
population is changed only on the basis of
a census count with periodic corrections
made throughout the year.

Vehicle License Tax
Vehicle license taxes have been shared
with Arizona cities and towns since 1941.
The tax is assessed on the basis of an
ad valorem rate on each $100 in value.
The value is equal to a percent of the
manufacturer‘s base retail price at the
time of initial registration. During each
succeeding year, this value is decreased
until the established minimum amount
is reached. The Arizona Department
of Transportation collects and distributes
the tax.

STATE INCOME TAX
(In Thousands of Dollars)
% Shared
w/Cities
Fiscal Year

2001-02
2002-03
2003-04
2004-05 (Est.)
2005-06 (Est.)

15.0%
14.8
14.8
15.0
15.0

Cities’ Share of
State Collections

Phoenix’s Share

Total

% Change

Percent

Amount

% Change

$421,367
429,988
365,842
373,065
425,230

6.3%
2.0
(14.9)
2.0
14.0

32.7% *
32.7
32.6**
32.6
32.6

$137,787
140,600
119,118
121,470
138,455

3.1%
2.0
(15.3)
2.0
14.0

*Phoenix growth rate is lower than the city share growth due to population changes in the
2000 Census.
**The adjustment to the percentage is due to a correction made to the 2000 Census
population amount of another Arizona city.

________________________________________________________________________
VEHICLE LICENSE TAX

(In
Thousands of Dollars)
________________________________________________________________________
Amount
Increase/(Decrease)
Phoenix’s Share
Distributed by
Fiscal
Year
Maricopa
County
Percent
Amount
Amount Percent
________________________________________________________________________
2001-02
2002-03
2003-04
2004-05 (Est.)
2005-06 (Est.)

$ 99,443
103,596
116,100
123,807
131,753

46.1%
46.1
46.1
46.1
46.1

$45,843
47,758
53,522
57,100
60,765

$1,104
1,915
5,764
3,578
3,665

2.5%
4.2
12.1
6.7
6.4

61

Currently, 37.61 percent of collections
are allocated to the Arizona Highway Users
Revenue fund. The remainder is allocated
by percentage to various state funds as
well as to the counties and cities. The
state is responsible for distributing funds
to cities according to their relative
population within the county. Based on
the 2000 census, Phoenix’s percentage
of population within Maricopa County
is approximately 46.1 percent. This
distribution formula was used in
developing the 2005-06 estimate.
Phoenix’s share of the vehicle license
tax for 2005-06 is anticipated to be
$60,765,000, which is $3,665,000 or
6.4 percent more than the 2004-05
estimate of $57,100,000.
The table on page 61 shows the cities’
share of the vehicle license tax, Phoenix’s
share, allocation percentage and annual
percentage change since 2001-02.

GENERAL FUNDS
Total Revenues – $922.2 Million

Primary
Property Tax
9.9%

________________________________________________________________________
PRIMARY PROPERTY TAX
________________________________________________________________________
Primary Assessed
Rate per
Valuation
%
Primary Levy
%
$100 Assessed
Fiscal Year
(in Billions)
Change
(in Thousands)
Change
Valuation
________________________________________________________________________

PRIMARY PROPERTY TAX
Arizona property taxes are divided into
two levies. The primary levy is used for
general operation and maintenance
expense. The secondary levy can only be
used for general obligation debt service.
The annual increase in the primary
property tax levy is limited by the Arizona
Constitution to a 2 percent increase over
the calculated levy associated with
previously assessed property plus an
estimated levy for previously unassessed
property (primarily new construction).
Before 1996-97, the maximum levy
allowed by the Arizona Constitution had
been levied each year. Leading up to
1996-97, due to a number of years of
declining assessed valuations, deferral
of the property tax-supported Capital
Improvement Program was necessary.
A new revenue policy was also established.
This policy called for a maximum and
minimum allowable combined primary and
secondary property tax rate. By 1996-97,
the application of this revenue policy had
driven the combined rate down to the
adopted minimum of $1.82.

62

2001-02
2002-03
2003-04
2004-05 (Est.)
2005-06 (Est.)

$ 7,689
8,269
9,049
9,800
10,637

9.5%
7.5)
9.4)
8.3)
8.5)

$ 61,818
65,107
76,392*
83,304*
91,311*

3.7%
5.3
17.3
9.0
9.6

$.82
.80
.85
.85
.86

*Includes $7 million, $3 million and $5 million shifted from secondary property tax in
2003-04,
2004-05 and 2005-06 respectively.
________________________________________________________________________

Primary Property Tax Rate
(combined rate each year is $1.82)
$1.00

0.92

0.91

0.87

0.86

1999-00

2000-01

0.82

0.80

0.85

0.85

0.86

2001-02

2002-03

2003-04

2004-05

2005-06

$0.75
$0.50
$0.25
$0.00
1997-98

1998-99

Fiscal Year

In 1997-98, a new policy was adopted
that provided for the primary levy to be set
at the previous year’s levy plus an amount
for new construction. Market updates in
property values were only to be reflected in
the secondary portion, which is discussed
in a later section. As shown in the
above chart, this policy caused the
primary rate to decline over time. Then,
the 2001 bond committee recommended
that a total of $10,000,000 be “shifted”
to the primary property tax levy from the
secondary property tax levy over a two-year
period. This was accomplished in 2003-04
and 2004-05 as planned. However, even
with the shift, the 2004-05 primary level
was less than the maximum levy allowed
by the Arizona Constitution.

The estimated 2005-06 primary
property tax levy is $91,311,000, which is
the maximum allowed by the Arizona
Constitution. This is a 9.6 percent
increase over the 2004-05 actual levy of
$83,304,000. The increase in primary levy
reflects estimated collections associated
with new properties entering the rolls, plus
a shift of approximately $5 million from
the secondary property tax levy to achieve
the maximum primary levy while
maintaining the current combined rate
of $1.82. Without the shift, the 2005-06
primary property tax levy would be 2.9
percent higher than the actual 2004-05

levy. The primary assessed valuation of
$10.64 billion is approximately 8.5 percent
above the 2004-05 primary assessed
valuation of $9.80 billion.
The 2005-06 levy results in an
estimated primary property tax rate of
$0.8584 per $100 of assessed valuation.
This would result in a secondary property
tax rate of $0.9616 to maintain a total
property tax rate of $1.82 per $100 of
assessed valuation.
The table on page 62 shows primary
assessed valuation, primary property tax
revenues and primary rates since 2001-02.

63

USER FEES/OTHER REVENUES
This major revenue category consists of
licenses and permits, fines and forfeitures,
cable television fees, parks and libraries
fees, various user fees designed to recover
the costs of providing specific city services,
and other miscellaneous General Fund
revenue sources. The 2005-06 estimate for
this category is $107.6 million, which is
$7.4 million or 7.4 percent higher than
the 2004-05 estimate of $100.2 million.
Following are descriptions of the various
categories and explanations of the
revenue estimates.

GENERAL FUNDS
Total Revenues – $922.2 Million

User Fees
and Other Revenues
11.7%

Licenses and Permits
This category consists of various business
permit application fees and annual permit
fees including liquor license applications,
amusement machines, annual liquor
licenses and other business license
applications and fees. The 2005-06
estimate of $2,496,000 is the same as the
2004-05 estimate, given the slow historical
growth in this category.

Cable Communications
The city imposes a 5 percent fee on the
gross receipts of cable television licensees
in return for the use of streets and public
rights of way by cable companies in the
provision of cable television service. The
2005-06 estimate of $8,785,000 is $256,000
or 3.0 percent greater than the 2004-05
estimate of $8,529,000. The increase
is based on conservative growth in the
customer base, plus moderate rate
increases of 2 percent and 2.25 percent
for cable providers.

Fines and Forfeitures
This category is comprised of various
sanctions including traffic moving
violations, criminal offense fines, parking
violations, driving under the influence
and defensive driving program revenues.
The 2005-06 estimate of $20,070,000 is
$1,187,000 or 6.3 percent more than the
2004-05 estimate of $18,883,000. The
estimate reflects increases in moving
violations and criminal offense fines, plus
greater participation in the Defensive
Driving Program. About half of the
expected increase is a result of the
city’s recent participation in the Arizona
State Court enhanced collection efforts
including withholding vehicle registrations
until delinquent fines are paid.

Court Default Fee
A $25 default fee was implemented in
1993-94 in order to recover court costs
associated with defendants who fail to
appear for court appearances or fail to
pay previously imposed sanctions on civil
traffic violations. The 2005-06 estimate for
this revenue category is $1,079,000, which
is 16.3 percent higher than the 2004-05
estimate. The estimate is based on year
to date actuals and historical growth
patterns.

64

Engineering and
Architectural Services
This user-fee category includes permits
for utility construction and fiber optic
construction in the public rights of way.
It also includes revenues from fees for
pavement cut activity. The 2005-06
estimate of $2,529,000 is $777,000 or
44.3 percent more than the 2004-05
estimate of $1,752,000. A majority of the
2005-06 increase is due to a large write-off
of bad debts in 2004-05. In addition, the
2005-06 estimate includes a reduction in
Right of Way fees from APS and Southwest
Gas resulting from the voter approved
franchise agreement in March 2005.

Fire
The Fire Department receives fees from
various services. The majority of the
revenue comes from emergency
transportation service (ETS). This
user fee includes basic life support and
advanced life support services and related
charges for mileage and supplies for the
provision of ambulance service. The
2005-06 estimate for ETS is $25,709,000,
which is $3,389,000 or 15.2 percent greater
than the 2004-05 estimate of $22,320,000.

The increase is due to rate increases
approved by the Arizona Department
of Health Services as well as improved
collection rates.
Other Fire revenue sources include
fire prevention inspection fees, computer
aided dispatch (CAD) and various other
services provided to the community.
The 2005-06 estimate for other fires
services is $4,444,000 which is 1.6 percent
above 2004-05.

Hazardous Materials Permit
and Inspection Fee
Because incidents involving hazardous
materials have increased in recent years, a
hazardous materials permit and inspection
fee was established in October 2001.
Revenues from this category are used to
recover direct costs incurred for inspecting
businesses that use hazardous materials.
Upon review in 2003-04, the annual permit
fee amount was raised. This annual
permit now varies from $400 to $1,650
and depends on the volume of hazardous
materials stored on site. The 2005-06
estimate is $1,325,000, which is $25,000 or
1.9 percent over the 2004-05 estimate.

Library Fees
Library fee and fine revenue for 2005-06 is
expected to be $1,673,000, which is
$649,000 or 63.4 percent above the 2004-05
estimate. The increase is largely due to
increased library fines. Overdue charges
were raised from $.05 to $.10 per day for
juvenile items and from $.10 to $.20 per
day for all other books. The charge for
replacement library cards has been
increased from $1.00 to $2.00. These new
fines are consistent with other Valley city
libraries. Collection fine trends indicate
consistent growth with additional fine
revenue coming from the new Desert
Broom Library and the expanded
Palo Verde Library.

Parks and Recreation Fees

Other Service Charges

This category includes parks concession
revenues, swimming pool revenues, fees
for the use of various park facilities such
as ball fields and recreation programs,
activities at Municipal Stadium, Maryvale
Stadium and the Papago Baseball Facility
and other miscellaneous park fees. The
2005-06 estimate of $3,467,000 is $109,000
or 3.2 percent greater than the 2004-05
estimate. The increase is primarily due
to rentals of park ball fields and spring
training facilities.

Revenue in this category is composed of
several non-tax sources including interest
income, parking meter revenue, the
Downtown Enhancement District, in-lieu
property taxes, sales of surplus and
abandoned property, various rental,
parking and concession categories.
The 2005-06 estimate of $19,886,000 is
$2,721,000 or 15.9 percent more than
the 2004-05 estimate of $17,165,000.
This is primarily due to increased
interest earnings.

Planning

All Other Fees

User fees in this category include rezoning
fees and zoning adjustment fees for use
permits and variances. The 2005-06
estimate of $1,471,000 is $27,000 or 1.9
percent more than the 2004-05 estimate of
$1,444,000, reflecting growth in rezoning
and zoning adjustment fees.

This fee category consists of miscellaneous
service charges in the Finance, Housing,
Human Services and Neighborhood
Services departments and miscellaneous
categories. The 2005-06 estimate of
$1,473,000 is $1,013,000 or 40.7 percent
less than the 2004-05 estimate of
$2,486,000. The decrease is due to
one-time revenue of $1,011,000 in 2004-05
from the March 2005 franchise election.
Arizona Public Service (APS) and
Southwest Gas were required to pay the
costs associated with that election.

Police
The Police Department receives revenues
for various services and programs. Police
services are provided on a fee-per-hour
basis for school and athletic events as
well as other activities where a law
enforcement presence is desired. In
addition, a false alarm program includes
both permit fees and assessments for
false alarm responses. For 2005-06, the
estimate of $11,536,000 is 0.5 percent more
than the 2004-05 estimate of $11,477,000.

Street Transportation
This user fee category includes permit
fees for utility construction in the public
rights-of-way as well as utility ordinance
inspections. The 2005-06 estimate of
$1,636,000 is a 37.5 percent decrease
from the 2004-05 estimate of $2,618,000.
In accordance with the new franchise
agreement approved by the voters on
March 8, 2005, utility inspection fees
for Arizona Public Service (APS) and
Southwest Gas have been discontinued.

65

NON-GENERAL FUNDS
Non-General Fund revenues consist of two
major categories: Special Revenue and
Enterprise funds. The following sections
provide descriptions of the various revenue
sources in each category and explanations
of 2005-06 revenue estimates. The table
on the next page provides the 2004-05
and 2005-06 estimates and 2003-04 actual
revenue amounts for revenues within
these two categories.

SPECIAL REVENUE FUNDS
This category consists of several revenue
sources that are earmarked for specific
purposes. Included in this category are
voter-approved sales taxes for
Neighborhood Protection, Parks and
Preserves, Transit 2000 and Public Safety
Enhancement. Also included in this
category are revenue from Court Awards,
Development Services, Capital
Construction, Sports Facilities, Arizona
Highway User Revenue funds, Local
Transportation Assistance funds, Public
Transit, Community Reinvestment,
Secondary Property Tax, grant funds
and other revenues.

Neighborhood Protection Sales Tax
This 0.1 percent sales tax rate was
approved by the voters in October 1993
and implemented in December 1993.
As presented to the voters, the 0.1 percent
increase is specifically earmarked for
Police Neighborhood Protection programs
(70 percent), Police Block Watch
programs (5 percent) and Fire
Neighborhood Protection programs
(25 percent). The 2005-06 estimate of
$27,471,000 is $2,110,000 or 8.3 percent
greater than the 2004-05 estimate of
$25,361,000. These estimates are
consistent with those for the same
categories in the local sales tax discussion.
Also, $83,000 is estimated in each year
for interest revenue.

66

Public Safety Enhancement
Sales Tax
The Public Safety Enhancement Sales Tax
was implemented on May 1, 2005, and is
made up of the 2.0 percent increment of
the 2.7 percent sales tax on utilities with
franchise agreements. The fund is
allocated between Police and Fire needs.
The Police Public Safety Enhancement
fund is allocated 62 percent of revenues
and is dedicated to Police and Emergency
Management needs. The Fire Public
Safety Enhancement fund is allocated
38 percent of the revenues collected and
is dedicated to Fire needs. The 2004-05
estimate is $3,788,000 which reflects
two months of revenue collections.
The 2005-06 estimate is $16,640,000
which reflects a full year of revenue
collections.

Parks and Preserves Sales Tax
The Parks and Preserves sales tax is a 0.1
percent sales tax rate increase approved
by voters in September 1999 and
implemented in November 1999. Revenues
from the 0.1 percent tax are allocated to
park improvements and acquisition of
desert preserves. Sixty percent of the
revenues are to be used for preservation,
30 percent for regional parks, and 10
percent for neighborhood and community
parks. The 2005-06 estimate of
$27,472,000 is $2,110,000 or 8.3 percent
more than the 2004-05 estimate of
$25,362,000. These estimates are
consistent with the estimates for the same
categories in the local sales tax discussion.
The 2004-05 estimate includes one-time
interest earnings of $1,300,000 resulting
from delayed land purchases.

Transit 2000 Funds
The Transit 2000 tax is a 0.4 percent sales
tax approved by the voters in March 2000
and implemented in June 2000. The 0.4
percent tax is specifically earmarked for
transit programs and improvements.

The 2005-06 estimate of $109,888,000 is
$8,441,000 or 8.3 percent greater than
the 2004-05 estimate of $101,447,000.
These estimates are consistent with the
estimates for the same categories in
the local sales tax discussion.
Also included in this fund are fare box
and other miscellaneous transit system
revenues. Fare box revenues are the
revenues collected by the transit service
for bus ridership. The 2005-06 fare box
revenue estimate of $23,132,000 is 0.9
percent greater than the 2004-05 estimate,
and reflects the continued expansion
of services. The 2005-06 estimate also
includes interest earnings of $6,961,000
which is a 5.4 percent decrease from
2004-05.

Court Awards Funds
The city of Phoenix receives funds as a
result of participation in the arrest and/or
prosecution of certain criminal cases.
These funds, referred to as Court Awards
funds, represent court-ordered forfeitures
of seized assets. Their use is limited to the
police and prosecutor functions. Revenue
estimates are based on cases in progress.
The estimate for 2005-06 is $2,699,000.

Development Services
Revenues in this user fee category
include building permits and plans review,
subdivision and site plan fees, sign permit
fees and engineering permits and plan
review fees. These fees are used to fully
support the activities of the Development
Services Department. The 2005-06
estimate is $52,977,000, which is
$1,305,000 or 2.5 percent more than the
2004-05 estimate of $51,672,000. The
growth in the residential and commercial
sector is driving increases in the revenue
for 2005-06. The increased revenue is
primarily associated with increases in
permits and plan review associated
with this growth.

NON-GENERAL FUND REVENUES BY MAJOR SOURCE
(In Thousands of Dollars)
Revenue Source

2003-04
Actual

2004-05
Estimate

Increase/(Decrease)
from 2004-05 Est.
Amount
Percent

2005-06
Budget

Special Revenue Funds
Neighborhood Protection
Public Safety Enhancement
Parks and Preserves
Transit 2000
Court Awards
Development Services
Capital Construction
Sports Facilities
Arizona Highway User Revenue
Local Transportation Assistance
Regional Transit Revenues
Community Reinvestment
Secondary Property Tax
Impact Fee Program Administration
Court Special Fees
Monopole Rental
Tennis Center
Heritage Square
Other Restricted Revenues
Grants
Public Housing Grants
Human Services Grants
Community Development
Criminal Justice
Public Transit Grants
HOPE VI Grant
Other Grants

$

23,133
0
23,957
121,168
3,036
47,036
18,170
13,311
115,438
7,245
9,531
2,094
94,923
0
1,604
123
24
17
)55,614

$

25,444
3,788
26,662
131,744
3,343
51,672
19,427
14,284
118,406
7,130
10,610
2,084
102,356
3,015
1,671
133
23
16
16,870

$

27,554
16,640
27,471
139,981
2,699
52,977
20,098
15,086
122,493
7,130
10,732
2,084
110,461
3,165
1,736
133
23
16
7,192

$ 2,110
12,852
810
8,237
(644)
1,305
671
802
4,087
_

(9,678)

8.3%
339.3
3.0
6.3
(19.3)
2.5
3.5
5.6
3.5
0.0
1.1
0.0
7.9
5.0
3.9
0.0
0.0
0.0
(57.4)

122
_
8,105
150
65
_
_
_

66,694
46,630
19,009
11,575
9,287
4,781
10,151

70,371
47,395
22,943
19,892
10,365
20,695
15,725

67,065
43,931
33,381
7,843
7,457
6,849
11,869

(3,306)
(3,464)
10,438
(12,049)
(2,908)
(13,846)
(3,856)

(4.7)
(7.3)
45.5
(60.6))
(28.1)
(66.9)
(24.5)

$ 168,127

$ 207,386

$ 178,395

$(28,991)

(14.0)%

$ 654,551

$ 746,064

$ 746,067

$

Aviation
Water System
Wastewater System
Solid Waste
Civic Plaza
Golf Courses

219,275
250,046
146,805
100,110
51,448
6,116

233,443
256,365
152,035
105,958
55,699
6,702

240,367
287,350
158,947
111,826
60,234
7,281

6,924
30,985
6,912
5,868
4,535
579

Total Enterprise Funds

$ 773,800

$ 810,202

$ 866,005

$ 55,803)

6.9%

TOTAL NON-GENERAL
FUND REVENUE

$1,428,351

$1,556,266

$1,612,072

$ 55,806)

3.6%

Subtotal - Grants
Total Special Revenue Funds

3)

0.0%

Enterprise Funds
3.0
12.1
4.5
5.5
8.1
8.6

67

Capital Construction
This category includes revenue from
a 2 percent increase in the sales tax on
telecommunications implemented in
February 1998. This tax is intended to
reimburse Phoenix residents for the use
of their public rights-of-way by the
telecommunications industry. The 2005-06
estimate is $19,298,000, or a 3.9 percent
increase over 2004-05 estimate. These
funds are used primarily for right-of-way
improvements in the Street Transportation
Capital Improvement Program.
The 2005-06 estimate also includes
interest earnings, for which, $850,000
is estimated in 2004-05 and $800,000 is
estimated in 2005-06.

Sports Facilities
Sports Facilities revenues consist of a
1 percent portion of the 4.8 percent
hotel/motel tax category, a 2 percent tax
on short-term motor vehicle rentals, and
interest revenue generated by the fund.
The 2005-06 estimate is $14,761,000, which
is $802,000 more than the 2004-05 estimate
of $13,959,000. The revenue estimates
are consistent with the General Fund
sales tax estimates in the hotel/motel
and short-term vehicle rental categories.
The 2005-06 estimate includes $6.6 million
for the hotel/motel portion and $8.2
million for the short-term car rental
portion. Also, $325,000 is estimated in
each year for interest revenue.

Arizona Highway User Revenue
The State Transportation Financing Plan
adopted by the Legislature in 1981 and
amended in 1982 and 1985 includes a
13 cent per gallon gas tax plus other user
fees and charges such as registrations,
driver’s licenses, motor carrier taxes, other
miscellaneous fees and an increased share
of the motor vehicle license taxes.
Additional gasoline taxes were added
in 1986 (3 cents per gallon), in 1988
(1 cent per gallon), and in 1990 (1 cent
per gallon) for a total local gas tax rate
of 18 cents per gallon.

68

ARIZONA HIGHWAY USER REVENUES
(In Thousands of Dollars)
Fiscal Year

AHUR Distribution

2001-02

$100,406

Increase/(Decrease)
Amount
Percent
$(2,192))

(2.1)%*

2002-03

104,596

4,190

4.2

2003-04

111,757

7,161

6.9

2004-05 (Est.)

116,786

5,029)

4.5

2005-06 (Est.)

120,873

4,087)

3.5

*2000 Census adjustment to population is reflected.

A new distribution formula for Arizona
Highway User Revenue (AHUR) was
passed by the Legislature and signed by
the governor in May 1996 (effective July 1,
1996). It was intended to be revenue
neutral to cities. This distribution formula
provides 27.5 percent to incorporated
cities and towns (distributed one-half on
the relative population of the cities and
towns and one-half on the county origin of
sales/relative population of the counties)
and 3 percent to cities over 300,000
population (Phoenix, Tucson and Mesa).
For 2005-06, it is anticipated that Phoenix
will receive $99.0 million from the 27.5
percent share and $21.9 million from the
3 percent share.
The total 2005-06 AHUR estimate of
$122,493,000 is $4,087,000 or 3.5 percent
more than the 2004-05 estimate of
$118,406,000. Included in the estimate is
$120,873,000 state-shared AHUR, which is
$4,087,000 or 3.5 percent more than the
2004-05 estimate. Also included in the
estimate for both years is $1,620,000 in
interest earnings and other income.
The state-shared increase is based on
anticipated increases at the state level
of 6.9 percent in gasoline tax collections,
7.4 percent in motor carrier tax collections
(trucking), 4.0 percent in vehicle license
tax collections and 2.7 percent in vehicle

registrations. The table above shows the
state-shared Arizona Highway Users
allocations to the city of Phoenix
since 2001-02.

Local Transportation
Assistance (LTA)Funds
In July 1981, the Legislature passed
a transportation bill that provided for a
Local Transportation Assistance fund.
Beginning July 1, 1983, $20.5 million
(minimum) to $23 million (maximum)
annually from the sale of state lottery
tickets is allocated to the Local
Transportation Assistance (LTA) fund.
LTA funds are distributed to incorporated
cities in proportion to annual population
estimates developed by the Department
of Economic Security.
For cities that exceed 300,000 in
population, LTA funds are to be used for
mass transit operating expenses. The law
also provides for up to 10 percent of the
city’s LTA funds to be used for cultural,
educational, historical, recreational or
scientific projects and outpatient
developmental disability programs. LTA
funds used for these non-transit purposes
must be matched on a 50/50 basis with
non-public funds and the total LTA funds
must reach the $23 million maximum for
this type of expenditure to be made.

The 2005-06 estimate for LTA revenue
is $7.1 million which assumes the $23
million maximum is reached. The city
receives 31 percent of the total LTA funds
distributed statewide. The allocation
is primarily used for funding the transit
system. Consistent with LTA fund
provisions and past practices, $106,000
is estimated for arts grants.

Regional Transit Revenues
This category includes revenue from the
Regional Public Transportation Authority
(RPTA), other state funding agencies,
the sale of bus service provided to other
jurisdictions, and bus shelter advertising.
The 2005-06 estimate of $10,732,000 is
$122,000 or 1.1 percent above the 2004-05
estimate of $10,610,000. The increase
is due to modest increases in other
government participation.

Community Reinvestment
The 2005-06 estimate of $2,084,000
represents estimated redevelopment
revenues to be received through various
economic redevelopment agreements.
Redevelopment areas include Sky Harbor
Center and the downtown area.

________________________________________________________________________
SECONDARY
PROPERTY TAX
________________________________________________________________________
Secondary Assessed
Rate per
Secondary Levy
$100 Assessed
Valuation
Fiscal
Year
(in Billions) % Change (in Thousands) % Change
Valuation
________________________________________________________________________
2001-02
2002-03
2003-04
2004-05 (Est.)
2005-06 (Est.)

$ 8,232
8,803
9,792
10,490
11,420

8.7%
6.9%
11.2%
7.1%
8.9%

levy of $101,756,000. The increase is
primarily because of an 8.9 percent
increase in net assessed property values
for Phoenix, offset by the $5,000,000 shift.
Also included in the 2005-06 estimate
is $650,000 in interest earnings, an 8.3
percent increase above 2004-05.
The total property tax rate of $1.82
for 2005-06 has remained unchanged
since 1995-96.
The following above shows secondary
assessed valuation, secondary property tax
levies and secondary property tax rates
since 2001-02.

Impact Fee Program Administration
Secondary Property Tax
By law, the secondary property tax is
earmarked for servicing general obligation
bond principal and interest costs. There
is no statutory limitation on the property
taxes levied for debt service purposes.
As discussed in the General Fund
revenues section, the estimated property
tax rate is $0.8584. To maintain our
current $1.82 total rate, the resulting
secondary rate is $0.9616 per $100 of
assessed value for 2005-06. The 2005-06
secondary property tax levy of $109,811,000
is based on this projected rate and
secondary assessed valuation of $11.42
billion, but also reflects the previously
discussed $5,000,000 shifted to the primary
property tax levy. This levy is $8,055,000
or 7.9 percent greater than the 2004-05

In 1987, the City Council established an
Impact Fee Program. Impact fees are
charged in addition to building permit fees
to new development in the city’s peripheral
planning areas. Impact fees assess new
development for its proportionate costs
of public infrastructure that will be
required due to the development. In
conjunction with the Impact Fee Program,
an administrative fee of three percent of
the impact fee amount is also charged.
This administrative fee pays for the costs
of administering the overall impact
fee program.
Beginning in 2004-05, the revenue from
the administrative fee and the related
costs are significant enough to require
separate accounting. The 2004-05 and
2005-06 revenue estimates are $3,015,000
and $3,165,000 respectively. Because it

$ 82,642
89,948
94,984
101,756
109,811

13.7%
8.8%
5.6%
7.1%
7.9%

$1.00
1.02
0.97
0.97
0.96

is related to development activity, this
revenue source can be volatile. Rising
interest costs could slow new development
and as a result a conservative growth rate
of 5.0 percent is assumed for 2005-06.

Other Restricted Fees
Included in this category are revenues
associated with the Court Technology
Enhancement fee and the Judicial
Collection Enhancement fund, Heritage
Square, the Tennis Center at Washington
Park, Affordable Housing Program revenues and monopole rentals from several
city parks. Also included is revenue from
restricted fees for recreation and other
programs, and donations specified for
various city programs. The 2005-06
estimate of $9,100,000 is $9,613,000 below
the 2004-05 estimate of $18,713,000.
The decrease is primarily due to one-time
donations of $9,100,000 dedicated to the
Phoenix Art Museum expected in 2004-05.

Public Housing Grants
The 2005-06 Assisted Housing grants
revenue included in the annual operating
budget is $67,065,000. This category
includes the HOME program that is aimed
at increasing the availability of affordable
rental housing and expanding home
ownership opportunities for first-time
homebuyers. Other items in this category
include housing subsidies, interest income
and housing assistance payments.

69

Human Services Grants

HOPE VI Grant

Aviation

The 2005-06 revenue estimate of
$43,931,000 is $3,464,000 less than
the 2004-05 estimate of $47,395,000.
This category includes funds from the
Department of Health and Human
Services, Workforce Investment Act,
Aging Program Grants and Head
Start funds.

In October 2001, the U.S. Department of
Housing and Urban Development awarded
$34 million in HOPE VI funding to the city
for the revitalization of the Matthew
Henson public housing development.
The revenue estimate assumes that
$6,849,000 of that grant will be earned
and expended in 2005-06.

Community Development
Block Grant

Other Grants

Aviation revenue estimates include landing
fees, concession revenues and interest
income at Sky Harbor International,
Deer Valley and Goodyear airports.
Total Aviation revenue for 2005-06 is
anticipated to be $240,367,000, which is
$6,924,000 or 3.0 percent greater than the
2004-05 estimate of $233,443,000. The
2005-06 estimate anticipates conservative
growth in airline fees, concessions and
parking revenues, and increased fuel sales
as airport activity continues to return to
a more normal level.
The first table on page 71 shows
Aviation revenue by major category and
annual percent change since 2001-02.

Each year since 1974, the city has received
Community Development Block Grant
funds from the U.S. Department of
Housing and Urban Development. These
funds are used to support a variety of
projects and programs that must meet
the following national objectives: benefit
low- and moderate-income persons; aid in
the prevention or elimination of slums and
blight; or meet other urgent community
development needs. The 2005-06 CDBG
entitlement plus carryover amounts is
$33,381,000.

Criminal Justice Grants
The 2005-06 grant revenue for Criminal
Justice programs is estimated to be
$7,843,000. This includes Police, Court
and Law department grants. Grants
include Universal Hiring grants totaling
$1.3 million, $3.1 million in Homeland
Security grants, and renewals of ongoing
state grants.

Public Transit Grants
The 2005-06 Federal Transit
Administration Grant estimate is
$7,457,000 reflecting a decrease of
$2,908,000 below the 2004-05 estimate
of $10,365,000.

70

The 2005-06 budget also includes
$11,869,000 for federal, state and other
grants that provide funding for some parks
and recreation and library activities as
well as unique programs such as urban
area security.

Water System
ENTERPRISE FUNDS
This category includes revenues from the
city’s six enterprise funds including
Aviation, Water, Wastewater, Solid Waste,
Civic Plaza and Golf. These enterprise
funds fully recover their costs through user
fees associated with the provision of their
services. This category also includes the
Civic Plaza that, in addition to the user
fees associated with the operation of the
Civic Plaza, is supported by earmarked
sales taxes. Following are descriptions
of each enterprise fund category and
explanations of the revenue estimates.

Water system revenues include water sales,
development fees, various water service
fees, resource acquisition fees, fees paid by
other jurisdictions for the operation of the
Val Vista Water Treatment Plant and other
miscellaneous fees. Total water system
revenue for 2005-06 is projected to be
$287,350,000, which is $30,985,000 or
12.1 percent more than the $256,365,000
estimate for 2004-05. The 2005-06
estimate reflects modest increases in
metered water sales from account growth,
a 7 percent rate increase, as well as
continued economic growth and from
increased revenues related to the
Val Vista Treatment Plant.
The second table on page 71 shows
water system revenues by major category
since 2001-02.

Human Services Grants

HOPE VI Grant

Aviation

The 2005-06 revenue estimate of
$43,931,000 is $3,464,000 less than
the 2004-05 estimate of $47,395,000.
This category includes funds from the
Department of Health and Human
Services, Workforce Investment Act,
Aging Program Grants and Head
Start funds.

In October 2001, the U.S. Department of
Housing and Urban Development awarded
$34 million in HOPE VI funding to the city
for the revitalization of the Matthew
Henson public housing development.
The revenue estimate assumes that
$6,849,000 of that grant will be earned
and expended in 2005-06.

Community Development
Block Grant

Other Grants

Aviation revenue estimates include landing
fees, concession revenues and interest
income at Sky Harbor International,
Deer Valley and Goodyear airports.
Total Aviation revenue for 2005-06 is
anticipated to be $240,367,000, which is
$6,924,000 or 3.0 percent greater than the
2004-05 estimate of $233,443,000. The
2005-06 estimate anticipates conservative
growth in airline fees, concessions and
parking revenues, and increased fuel sales
as airport activity continues to return to
a more normal level.
The first table on page 71 shows
Aviation revenue by major category and
annual percent change since 2001-02.

Each year since 1974, the city has received
Community Development Block Grant
funds from the U.S. Department of
Housing and Urban Development. These
funds are used to support a variety of
projects and programs that must meet
the following national objectives: benefit
low- and moderate-income persons; aid in
the prevention or elimination of slums and
blight; or meet other urgent community
development needs. The 2005-06 CDBG
entitlement plus carryover amounts is
$33,381,000.

Criminal Justice Grants
The 2005-06 grant revenue for Criminal
Justice programs is estimated to be
$7,843,000. This includes Police, Court
and Law department grants. Grants
include Universal Hiring grants totaling
$1.3 million, $3.1 million in Homeland
Security grants, and renewals of ongoing
state grants.

Public Transit Grants
The 2005-06 Federal Transit
Administration Grant estimate is
$7,457,000 reflecting a decrease of
$2,908,000 below the 2004-05 estimate
of $10,365,000.

70

The 2005-06 budget also includes
$11,869,000 for federal, state and other
grants that provide funding for some parks
and recreation and library activities as
well as unique programs such as urban
area security.

Water System
ENTERPRISE FUNDS
This category includes revenues from the
city’s six enterprise funds including
Aviation, Water, Wastewater, Solid Waste,
Civic Plaza and Golf. These enterprise
funds fully recover their costs through user
fees associated with the provision of their
services. This category also includes the
Civic Plaza that, in addition to the user
fees associated with the operation of the
Civic Plaza, is supported by earmarked
sales taxes. Following are descriptions
of each enterprise fund category and
explanations of the revenue estimates.

Water system revenues include water sales,
development fees, various water service
fees, resource acquisition fees, fees paid by
other jurisdictions for the operation of the
Val Vista Water Treatment Plant and other
miscellaneous fees. Total water system
revenue for 2005-06 is projected to be
$287,350,000, which is $30,985,000 or
12.1 percent more than the $256,365,000
estimate for 2004-05. The 2005-06
estimate reflects modest increases in
metered water sales from account growth,
a 7 percent rate increase, as well as
continued economic growth and from
increased revenues related to the
Val Vista Treatment Plant.
The second table on page 71 shows
water system revenues by major category
since 2001-02.

SUMMARY OF AVIATION REVENUES
(In Thousands of Dollars)
2001-02

2002-03

2003-04

2004-05
(Est.)

2005-06
(Est.)

Airline Operation
Concessions and Rentals
Interest
Other/Federal Grants
Goodyear
Deer Valley

$ 75,815%
106,033%
8,507%
2,086%
1,811%
2,351%

$ 76,223%)
113,296 %
5,854
13,754%)
1,813%
2,419%

$ 78,910%
120,032%)
6,758%)
9,357 %
1,773%)
2,445%)

$ 88,410
129,661%
7,023%
3,675
2,049%
2,624%

$ 91,062
132,949%
6,723%
4,925
2,045%
2,663%

Total Aviation Revenue

$196,603%

$213,359%

$219,275%)

$233,443%

$240,367%

Change From Prior Year

1.7%

8.5%

2.8%%

6.5%

3.0%

SUMMARY OF WATER SYSTEM REVENUES
(In Thousands of Dollars)
2001-02

2002-03

2003-04

2004-05
(Est.)

Water Sales
Environmental Consumption Charge
Raw Water Charge
Interest
Development Fees
Combined Service Fees
Val Vista
All Other

$174,201%
10,855%
17,133%
13,526%
6,242%
1,379%
3,623%
9,125%

$171,472%
11,658%
15,879%
10,316%
7,625%
1,542%
4,104%
27,725%

$179,639%
15,956%
16,514%
8,571%
9,038%
1,740%
4,690%
13,898%

$185,464%
20,068%
16,068%
6,500%
10,000%
3,896%
4,428%
9,941%

$208,526%
24,642%
17,075%
10,613%
7,000%
5,329%
4,540%
9,625%

Total Water Revenue

$236,084%

$250,321%

$250,046

$256,365%

$287,350%

Change From Prior Year

3.6%

6.0%

(0.1%)

2.5%

2005-06
(Est.)

12.1%

71

Wastewater System
Wastewater system revenues include
monthly sewer service charge revenues,
which are based on water consumption
rates, development fees, the sale of
wastewater treatment services to other
jurisdictions, the sale of effluent and
other miscellaneous fees. The wastewater
system is expected to generate revenue
of $158,947,000 in 2005-06, which is
$6,912,000 or 4.5 percent greater than
the 2004-05 estimate of $152,035,000.
The increase is primarily due to projected
increases in sewer charges due to a full
year’s realization of the 9.0 percent rate
increase implemented in early 2005,
account growth and continued economic

growth. The table below shows
Wastewater revenue by major category
and annual percent change since 2001-02.

Solid Waste
This category includes revenues from the
monthly residential collection and landfill
tipping fees. The 2005-06 estimate of
$111,826,000 is an increase of $5,868,000
or 5.5 percent greater than the 2004-05
estimate of $105,958,000. The increase
assumes a full year’s impact of the
February 2005 rate increase of $1 and an
increase in housing units consistent with
the growth of the city’s economy.

Civic Plaza
The majority of Civic Plaza revenues are
from earmarked sales taxes including a
0.5 percent tax on advertising, a 0.5
percent portion of the 1.8 percent tax on
restaurant and bar sales, construction,
publishing, printing, and transportation
and towing, plus a 2 percent portion of
the 4.8 percent hotel/motel tax on rooms
rented for 30 days or less.
Earmarked sales taxes are expected
to produce $51,270,000 in 2005-06. Civic
Plaza operating revenues are expected to
be $4,836,000, parking revenue is expected
to be $3,128,000, and interest revenue
is expected to be $1,000,000, for total

____________________________________________________________________________________________________________
SUMMARY OF WASTEWATER SYSTEM REVENUES

(In Thousands of Dollars)
____________________________________________________________________________________________________________
2004-05
2005-06
2001-02
2002-03
2003-04
(Est.)
(Est.)
____________________________________________________________________________________________________________
Sewer Service Charge
$ 75,067%
$ 79,157%
$ 88,461%
$ 97,998%
$ 105,342%
Environmental Charges
20,464%
22,361%
22,862%
21,506%
21,843%
Development Fees
5,788%
7,260%
8,487%
9,500%
6,000%
4,258%
3,909%
3,255%
4,854%
6,724%
Interest
Multi-City
12,549%
14,689%
17,118%
15,072%
16,250%
Other
5,505%
5,009%
5,968%
4,704%
4,658%
Total Wastewater Revenue
Change From Prior Year

72

$126,097%
0.1%

$132,734%
5.3%

$146,805%
10.6%

$152,035%
3.6%

$158,947%
4.5%

revenue estimates of $60,234,000. This is
$4,534,000 or 8.1 percent more than the
2004-05 total estimated revenue of
$55,699,000. The increase is primarily
from increases in the earmarked sales tax
categories. Tax estimates are consistent
with general fund sales tax estimates for
the categories included in Civic Plaza.
The table on the right shows the Civic
Plaza excise tax collections since 2001-02.
Overall growth rates differ from
General fund sales taxes due to the
smaller number of categories, differing
proportions of the total and their more
volatile nature. As shown in the pie chart
on the right, contracting and tourism
represent 91 percent of the sales tax
revenue to this fund. Both industries are
considered volatile; the tourism industry
in particular has experienced dramatic
changes in the last several years. In the
General Fund, however, contracting and
tourism represent only 15 percent of the
sales tax revenue. Because of this, any
changes to these more volatile industries
have a greater impact in this fund’s sales
tax revenue than in the General Fund’s
sales tax revenue.
The growth rates anticipated for
2004-05 and 2005-06 reflect the continued
improvement in the tourism industry.
They also reflect a continuation of the
outstanding growth in construction
activity. Growth is anticipated from
significant commercial construction
projects such as the Civic Plaza expansion
and Light Rail as well as consistent growth
in the housing market.

CIVIC PLAZA SALES TAXES
(In Thousands of Dollars)
Increase/(Decrease)
Amount
Percent

Fiscal Year

Amount Collected

2001-02

$37,281

$ (266)

2002-03

36,849

(432)

(0.7)%
(1.2)

2003-04

40,322

3,473)

2004-05 (Est.)

46,758

6,436)

16.0

9.4)

2005-06 (Est.)

51,270

4,512)

9.6

2004-05 CIVIC PLAZA
Earmarked Sales Taxes

Tourism-related
50%

Contracting
41%

Other 9%

Golf Courses
Revenue sources in the Golf Course
category are greens fees and concession
sales at city golf courses which include
Aguila, Cave Creek, Encanto, Maryvale,
Palo Verde and Papago courses. The
2005-06 estimate of $7,281,000 is $579,000
or 8.6 percent above the 2004-05 estimate.

73

St a n to n ,
gn er,
le ft ) G re g
om
fr
d
te
) D ou g L in
g fr om le ft
cl u d es (s ea
in
in
d
l
n
ci
n
ta
n
so
(s
n
ou
en , a n d
h a el Jo h
ix C it y C
P eg gy B il st
M a y or M ic
T h e P h oe n
tt ox , V ic e
or d on a n d
a
G
M
il
e
h
d
P
u
la
or
May
m p lo t, C
ly, To m Si
P eg gy N ee
t.
er
Si eb
a n d D a ve

74

General Government

MAYOR

CITY COUNCIL

CITY MANAGER

Program Goal

Program Goal

Program Goal

The Mayor is elected on a nonpartisan
ballot to represent the entire city for a
four-year term that expires in January
2008. The Mayor represents the city in all
official capacities and provides leadership
to the City Council, administrative staff
and the community at large. The Mayor
recommends policy direction for the city
and chairs all City Council meetings.

The City Council is composed of eight
council members elected by districts on
a nonpartisan ballot. Four-year terms for
council members from even-numbered
districts expire in January 2006. Terms
for council members from odd-numbered
districts expire in January 2008. The City
Council serves as the legislative and
policy-making body of the municipal
government and has responsibilities for
enacting city ordinances, appropriating
funds to conduct city business and
providing policy direction to the
administrative staff. Under the provisions
of the City Charter, the City Council
appoints a city manager, who is responsible
for carrying out its established policies and
administering operations.

The city manager provides professional
administration of the policies and
objectives established by the Mayor and
City Council, develops alternative solutions
to community problems for Mayor and
City Council consideration and plans
programs that meet the future public
needs of the city.

Budget Allowance Explanation
The Mayor’s operating budget allowance of
$2,217,000 is $73,000 or 3.4 percent more
than 2004-05 estimated expenditures.
The increase is due to normal inflationary
increases and is partially offset by budget
reductions including reducing printing and
mailroom services for the Mayor’s Office.
These reductions may limit the Mayor
and staff’s ability to communicate with
the public.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$1,933,000 $2,144,000 $2,217,000
19.0

20.0

20.0

Source of Funds:
General

$1,927,000 $2,037,000 $2,102,000

Grants

5,000

93,000

101,000

Other Restricted

1,000

14,000

14,000

Budget Allowance Explanation
The City Manager’s operating budget
allowance of $1,280,000 is $51,000 or 4.1
percent higher than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary
2003-04

Budget Allowance Explanation

Operating Expense

The 2005-06 City Council operating budget
allowance of $4,237,000 is $237,000 or
5.9 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary increases and is
partially offset by 2005-06 budget
reductions. The budget reductions
reflected in the budget include the
reduction of replacement computers,
office furniture and supplies as well as
further reductions in travel budgets.
These reductions may impact the Council’s
ability to respond to constituent inquiries
in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

55.0

55.0

Source of Funds:
General

2005-06

$1,068,000 $1,229,000 $1,280,000
8.0

8.0

8.0

Source of Funds:
General

$1,068,000 $1,229,000 $1,280,000

DEPUTY CITY MANAGERS

Program Goal
The deputy city managers oversee and
provide assistance to city departments to
ensure achievement of their departmental
objectives and the objectives of the city
government as a whole.

Budget Allowance Explanation

2005-06

$3,344,000 $4,000,000 $4,237,000
55.0

Total Positions

2004-05

$3,344,000 $4,000,000 $4,237,000

The Deputy City Managers 2005-06
operating budget allowance of $1,647,000
is $12,000 more than 2004-05 estimated
expenditures. The increase is the result
of normal inflationary adjustments, offset

75

by the elimination of a deputy city
manager position. The budget also
converts one temporary executive position
and one temporary support position to
regular status.

Expenditure and Position Summary
2003-04 *
Operating Expense
Total Positions

2004-05

2005-06

Water

Expenditure and Position Summary

Program Goal
Intergovernmental Programs represents
the city, as appropriate, in contacts with
federal, state, regional, county and other
city governments. Intergovernmental
Programs also is charged with citywide
grants coordination.

2003-04
Operating Expense
Total Positions

19.0

21.0

21.0

$1,982,000 $1,406,000 $1,355,000
609,000

229,000

292,000

*Prior to 2004-05, the budgets of the various deputy
city managers and their support staff were contained
in several different departments. They have been
consolidated here for purposes of comparison.
Beginning in 2004-05, work order charges to enterprise
and special revenue departments were increased to
more accurately account for staff time allocated to
these departments.

General
Other Restricted

Budget Allowance Explanation
The Intergovernmental Programs 2005-06
operating budget allowance of $1,317,000
is $26,000 or 2.0 percent more than
2004-05 estimated expenditures. This
increase reflects normal inflationary
adjustments and is partially offset by
budget reductions. The budget reduces
funding for legislative consultants, which
will limit the city’s ability to respond to
issues impacting the city that emerge
during the legislative sessions.

se C it y,”
t of “D iv er
r, is th e h os
and
to
s
ec
m
ir
a
d
gr
on
rv ic es , p ro
in fo rm a ti
se
ic
se
m en t
bl
er
u
rn
p
iv
ve
d
e ci ty ’s go
ez , d ep u ty
m e of th e
th
ir
so
,
m
ts
a
11
R
gh
X
d
li
H
h
D a vi
a t h ig
n in g P
rm a n d
p ro gr a m th ci ty. T h e a w a rd -w in s th a t ed u ca te , in fo
a P H X 11
e
m
a
th
gr
by
ro
d
p
re
ty
of fe
qu a li
a ct iv it ie s
, p ro vi d es
s a w ee k.
e ch a n n el
d a y, 7 d a y
a
rs
ou
a cc es s ca bl
h
24
ts
en
d
si
re
en te rt a in

76

2004-05

2005-06

$1,180,000 $1,291,000 $1,317,000
6.3

6.3

6.3

Source of Funds:

$2,591,000 $1,635,000 $1,647,000

Source of Funds:
General

INTERGOVERNMENTAL PROGRAMS

$1,171,000 $1,279,000 $1,303,000
9,000

12,000

14,000

St a n to n ,
gn er,
le ft ) G re g
om
fr
d
te
) D ou g L in
g fr om le ft
cl u d es (s ea
in
in
d
l
n
ci
n
ta
n
so
(s
n
ou
en , a n d
h a el Jo h
ix C it y C
P eg gy B il st
M a y or M ic
T h e P h oe n
tt ox , V ic e
or d on a n d
a
G
M
il
e
h
d
P
u
la
or
May
m p lo t, C
ly, To m Si
P eg gy N ee
t.
er
Si eb
a n d D a ve

74

General Government

MAYOR

CITY COUNCIL

CITY MANAGER

Program Goal

Program Goal

Program Goal

The Mayor is elected on a nonpartisan
ballot to represent the entire city for a
four-year term that expires in January
2008. The Mayor represents the city in all
official capacities and provides leadership
to the City Council, administrative staff
and the community at large. The Mayor
recommends policy direction for the city
and chairs all City Council meetings.

The City Council is composed of eight
council members elected by districts on
a nonpartisan ballot. Four-year terms for
council members from even-numbered
districts expire in January 2006. Terms
for council members from odd-numbered
districts expire in January 2008. The City
Council serves as the legislative and
policy-making body of the municipal
government and has responsibilities for
enacting city ordinances, appropriating
funds to conduct city business and
providing policy direction to the
administrative staff. Under the provisions
of the City Charter, the City Council
appoints a city manager, who is responsible
for carrying out its established policies and
administering operations.

The city manager provides professional
administration of the policies and
objectives established by the Mayor and
City Council, develops alternative solutions
to community problems for Mayor and
City Council consideration and plans
programs that meet the future public
needs of the city.

Budget Allowance Explanation
The Mayor’s operating budget allowance of
$2,217,000 is $73,000 or 3.4 percent more
than 2004-05 estimated expenditures.
The increase is due to normal inflationary
increases and is partially offset by budget
reductions including reducing printing and
mailroom services for the Mayor’s Office.
These reductions may limit the Mayor
and staff’s ability to communicate with
the public.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$1,933,000 $2,144,000 $2,217,000
19.0

20.0

20.0

Source of Funds:
General

$1,927,000 $2,037,000 $2,102,000

Grants

5,000

93,000

101,000

Other Restricted

1,000

14,000

14,000

Budget Allowance Explanation
The City Manager’s operating budget
allowance of $1,280,000 is $51,000 or 4.1
percent higher than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary
2003-04

Budget Allowance Explanation

Operating Expense

The 2005-06 City Council operating budget
allowance of $4,237,000 is $237,000 or
5.9 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary increases and is
partially offset by 2005-06 budget
reductions. The budget reductions
reflected in the budget include the
reduction of replacement computers,
office furniture and supplies as well as
further reductions in travel budgets.
These reductions may impact the Council’s
ability to respond to constituent inquiries
in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

55.0

55.0

Source of Funds:
General

2005-06

$1,068,000 $1,229,000 $1,280,000
8.0

8.0

8.0

Source of Funds:
General

$1,068,000 $1,229,000 $1,280,000

DEPUTY CITY MANAGERS

Program Goal
The deputy city managers oversee and
provide assistance to city departments to
ensure achievement of their departmental
objectives and the objectives of the city
government as a whole.

Budget Allowance Explanation

2005-06

$3,344,000 $4,000,000 $4,237,000
55.0

Total Positions

2004-05

$3,344,000 $4,000,000 $4,237,000

The Deputy City Managers 2005-06
operating budget allowance of $1,647,000
is $12,000 more than 2004-05 estimated
expenditures. The increase is the result
of normal inflationary adjustments, offset

75

by the elimination of a deputy city
manager position. The budget also
converts one temporary executive position
and one temporary support position to
regular status.

Expenditure and Position Summary
2003-04 *
Operating Expense
Total Positions

2004-05

2005-06

Water

Expenditure and Position Summary

Program Goal
Intergovernmental Programs represents
the city, as appropriate, in contacts with
federal, state, regional, county and other
city governments. Intergovernmental
Programs also is charged with citywide
grants coordination.

2003-04
Operating Expense
Total Positions

19.0

21.0

21.0

$1,982,000 $1,406,000 $1,355,000
609,000

229,000

292,000

*Prior to 2004-05, the budgets of the various deputy
city managers and their support staff were contained
in several different departments. They have been
consolidated here for purposes of comparison.
Beginning in 2004-05, work order charges to enterprise
and special revenue departments were increased to
more accurately account for staff time allocated to
these departments.

General
Other Restricted

Budget Allowance Explanation
The Intergovernmental Programs 2005-06
operating budget allowance of $1,317,000
is $26,000 or 2.0 percent more than
2004-05 estimated expenditures. This
increase reflects normal inflationary
adjustments and is partially offset by
budget reductions. The budget reduces
funding for legislative consultants, which
will limit the city’s ability to respond to
issues impacting the city that emerge
during the legislative sessions.

se C it y,”
t of “D iv er
r, is th e h os
and
to
s
ec
m
ir
a
d
gr
on
rv ic es , p ro
in fo rm a ti
se
ic
se
m en t
bl
er
u
rn
p
iv
ve
d
e ci ty ’s go
ez , d ep u ty
m e of th e
th
ir
so
,
m
ts
a
11
R
gh
X
d
li
H
h
D a vi
a t h ig
n in g P
rm a n d
p ro gr a m th ci ty. T h e a w a rd -w in s th a t ed u ca te , in fo
a P H X 11
e
m
a
th
gr
by
ro
d
p
re
ty
of fe
qu a li
a ct iv it ie s
, p ro vi d es
s a w ee k.
e ch a n n el
d a y, 7 d a y
a
rs
ou
a cc es s ca bl
h
24
ts
en
d
si
re
en te rt a in

76

2004-05

2005-06

$1,180,000 $1,291,000 $1,317,000
6.3

6.3

6.3

Source of Funds:

$2,591,000 $1,635,000 $1,647,000

Source of Funds:
General

INTERGOVERNMENTAL PROGRAMS

$1,171,000 $1,279,000 $1,303,000
9,000

12,000

14,000

St a n to n ,
gn er,
le ft ) G re g
om
fr
d
te
) D ou g L in
g fr om le ft
cl u d es (s ea
in
in
d
l
n
ci
n
ta
n
so
(s
n
ou
en , a n d
h a el Jo h
ix C it y C
P eg gy B il st
M a y or M ic
T h e P h oe n
tt ox , V ic e
or d on a n d
a
G
M
il
e
h
d
P
u
la
or
May
m p lo t, C
ly, To m Si
P eg gy N ee
t.
er
Si eb
a n d D a ve

74

General Government

MAYOR

CITY COUNCIL

CITY MANAGER

Program Goal

Program Goal

Program Goal

The Mayor is elected on a nonpartisan
ballot to represent the entire city for a
four-year term that expires in January
2008. The Mayor represents the city in all
official capacities and provides leadership
to the City Council, administrative staff
and the community at large. The Mayor
recommends policy direction for the city
and chairs all City Council meetings.

The City Council is composed of eight
council members elected by districts on
a nonpartisan ballot. Four-year terms for
council members from even-numbered
districts expire in January 2006. Terms
for council members from odd-numbered
districts expire in January 2008. The City
Council serves as the legislative and
policy-making body of the municipal
government and has responsibilities for
enacting city ordinances, appropriating
funds to conduct city business and
providing policy direction to the
administrative staff. Under the provisions
of the City Charter, the City Council
appoints a city manager, who is responsible
for carrying out its established policies and
administering operations.

The city manager provides professional
administration of the policies and
objectives established by the Mayor and
City Council, develops alternative solutions
to community problems for Mayor and
City Council consideration and plans
programs that meet the future public
needs of the city.

Budget Allowance Explanation
The Mayor’s operating budget allowance of
$2,217,000 is $73,000 or 3.4 percent more
than 2004-05 estimated expenditures.
The increase is due to normal inflationary
increases and is partially offset by budget
reductions including reducing printing and
mailroom services for the Mayor’s Office.
These reductions may limit the Mayor
and staff’s ability to communicate with
the public.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$1,933,000 $2,144,000 $2,217,000
19.0

20.0

20.0

Source of Funds:
General

$1,927,000 $2,037,000 $2,102,000

Grants

5,000

93,000

101,000

Other Restricted

1,000

14,000

14,000

Budget Allowance Explanation
The City Manager’s operating budget
allowance of $1,280,000 is $51,000 or 4.1
percent higher than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary
2003-04

Budget Allowance Explanation

Operating Expense

The 2005-06 City Council operating budget
allowance of $4,237,000 is $237,000 or
5.9 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary increases and is
partially offset by 2005-06 budget
reductions. The budget reductions
reflected in the budget include the
reduction of replacement computers,
office furniture and supplies as well as
further reductions in travel budgets.
These reductions may impact the Council’s
ability to respond to constituent inquiries
in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

55.0

55.0

Source of Funds:
General

2005-06

$1,068,000 $1,229,000 $1,280,000
8.0

8.0

8.0

Source of Funds:
General

$1,068,000 $1,229,000 $1,280,000

DEPUTY CITY MANAGERS

Program Goal
The deputy city managers oversee and
provide assistance to city departments to
ensure achievement of their departmental
objectives and the objectives of the city
government as a whole.

Budget Allowance Explanation

2005-06

$3,344,000 $4,000,000 $4,237,000
55.0

Total Positions

2004-05

$3,344,000 $4,000,000 $4,237,000

The Deputy City Managers 2005-06
operating budget allowance of $1,647,000
is $12,000 more than 2004-05 estimated
expenditures. The increase is the result
of normal inflationary adjustments, offset

75

by the elimination of a deputy city
manager position. The budget also
converts one temporary executive position
and one temporary support position to
regular status.

Expenditure and Position Summary
2003-04 *
Operating Expense
Total Positions

2004-05

2005-06

Water

Expenditure and Position Summary

Program Goal
Intergovernmental Programs represents
the city, as appropriate, in contacts with
federal, state, regional, county and other
city governments. Intergovernmental
Programs also is charged with citywide
grants coordination.

2003-04
Operating Expense
Total Positions

19.0

21.0

21.0

$1,982,000 $1,406,000 $1,355,000
609,000

229,000

292,000

*Prior to 2004-05, the budgets of the various deputy
city managers and their support staff were contained
in several different departments. They have been
consolidated here for purposes of comparison.
Beginning in 2004-05, work order charges to enterprise
and special revenue departments were increased to
more accurately account for staff time allocated to
these departments.

General
Other Restricted

Budget Allowance Explanation
The Intergovernmental Programs 2005-06
operating budget allowance of $1,317,000
is $26,000 or 2.0 percent more than
2004-05 estimated expenditures. This
increase reflects normal inflationary
adjustments and is partially offset by
budget reductions. The budget reduces
funding for legislative consultants, which
will limit the city’s ability to respond to
issues impacting the city that emerge
during the legislative sessions.

se C it y,”
t of “D iv er
r, is th e h os
and
to
s
ec
m
ir
a
d
gr
on
rv ic es , p ro
in fo rm a ti
se
ic
se
m en t
bl
er
u
rn
p
iv
ve
d
e ci ty ’s go
ez , d ep u ty
m e of th e
th
ir
so
,
m
ts
a
11
R
gh
X
d
li
H
h
D a vi
a t h ig
n in g P
rm a n d
p ro gr a m th ci ty. T h e a w a rd -w in s th a t ed u ca te , in fo
a P H X 11
e
m
a
th
gr
by
ro
d
p
re
ty
of fe
qu a li
a ct iv it ie s
, p ro vi d es
s a w ee k.
e ch a n n el
d a y, 7 d a y
a
rs
ou
a cc es s ca bl
h
24
ts
en
d
si
re
en te rt a in

76

2004-05

2005-06

$1,180,000 $1,291,000 $1,317,000
6.3

6.3

6.3

Source of Funds:

$2,591,000 $1,635,000 $1,647,000

Source of Funds:
General

INTERGOVERNMENTAL PROGRAMS

$1,171,000 $1,279,000 $1,303,000
9,000

12,000

14,000

St a n to n ,
gn er,
le ft ) G re g
om
fr
d
te
) D ou g L in
g fr om le ft
cl u d es (s ea
in
in
d
l
n
ci
n
ta
n
so
(s
n
ou
en , a n d
h a el Jo h
ix C it y C
P eg gy B il st
M a y or M ic
T h e P h oe n
tt ox , V ic e
or d on a n d
a
G
M
il
e
h
d
P
u
la
or
May
m p lo t, C
ly, To m Si
P eg gy N ee
t.
er
Si eb
a n d D a ve

74

General Government

MAYOR

CITY COUNCIL

CITY MANAGER

Program Goal

Program Goal

Program Goal

The Mayor is elected on a nonpartisan
ballot to represent the entire city for a
four-year term that expires in January
2008. The Mayor represents the city in all
official capacities and provides leadership
to the City Council, administrative staff
and the community at large. The Mayor
recommends policy direction for the city
and chairs all City Council meetings.

The City Council is composed of eight
council members elected by districts on
a nonpartisan ballot. Four-year terms for
council members from even-numbered
districts expire in January 2006. Terms
for council members from odd-numbered
districts expire in January 2008. The City
Council serves as the legislative and
policy-making body of the municipal
government and has responsibilities for
enacting city ordinances, appropriating
funds to conduct city business and
providing policy direction to the
administrative staff. Under the provisions
of the City Charter, the City Council
appoints a city manager, who is responsible
for carrying out its established policies and
administering operations.

The city manager provides professional
administration of the policies and
objectives established by the Mayor and
City Council, develops alternative solutions
to community problems for Mayor and
City Council consideration and plans
programs that meet the future public
needs of the city.

Budget Allowance Explanation
The Mayor’s operating budget allowance of
$2,217,000 is $73,000 or 3.4 percent more
than 2004-05 estimated expenditures.
The increase is due to normal inflationary
increases and is partially offset by budget
reductions including reducing printing and
mailroom services for the Mayor’s Office.
These reductions may limit the Mayor
and staff’s ability to communicate with
the public.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$1,933,000 $2,144,000 $2,217,000
19.0

20.0

20.0

Source of Funds:
General

$1,927,000 $2,037,000 $2,102,000

Grants

5,000

93,000

101,000

Other Restricted

1,000

14,000

14,000

Budget Allowance Explanation
The City Manager’s operating budget
allowance of $1,280,000 is $51,000 or 4.1
percent higher than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary
2003-04

Budget Allowance Explanation

Operating Expense

The 2005-06 City Council operating budget
allowance of $4,237,000 is $237,000 or
5.9 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary increases and is
partially offset by 2005-06 budget
reductions. The budget reductions
reflected in the budget include the
reduction of replacement computers,
office furniture and supplies as well as
further reductions in travel budgets.
These reductions may impact the Council’s
ability to respond to constituent inquiries
in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

55.0

55.0

Source of Funds:
General

2005-06

$1,068,000 $1,229,000 $1,280,000
8.0

8.0

8.0

Source of Funds:
General

$1,068,000 $1,229,000 $1,280,000

DEPUTY CITY MANAGERS

Program Goal
The deputy city managers oversee and
provide assistance to city departments to
ensure achievement of their departmental
objectives and the objectives of the city
government as a whole.

Budget Allowance Explanation

2005-06

$3,344,000 $4,000,000 $4,237,000
55.0

Total Positions

2004-05

$3,344,000 $4,000,000 $4,237,000

The Deputy City Managers 2005-06
operating budget allowance of $1,647,000
is $12,000 more than 2004-05 estimated
expenditures. The increase is the result
of normal inflationary adjustments, offset

75

by the elimination of a deputy city
manager position. The budget also
converts one temporary executive position
and one temporary support position to
regular status.

Expenditure and Position Summary
2003-04 *
Operating Expense
Total Positions

2004-05

2005-06

Water

Expenditure and Position Summary

Program Goal
Intergovernmental Programs represents
the city, as appropriate, in contacts with
federal, state, regional, county and other
city governments. Intergovernmental
Programs also is charged with citywide
grants coordination.

2003-04
Operating Expense
Total Positions

19.0

21.0

21.0

$1,982,000 $1,406,000 $1,355,000
609,000

229,000

292,000

*Prior to 2004-05, the budgets of the various deputy
city managers and their support staff were contained
in several different departments. They have been
consolidated here for purposes of comparison.
Beginning in 2004-05, work order charges to enterprise
and special revenue departments were increased to
more accurately account for staff time allocated to
these departments.

General
Other Restricted

Budget Allowance Explanation
The Intergovernmental Programs 2005-06
operating budget allowance of $1,317,000
is $26,000 or 2.0 percent more than
2004-05 estimated expenditures. This
increase reflects normal inflationary
adjustments and is partially offset by
budget reductions. The budget reduces
funding for legislative consultants, which
will limit the city’s ability to respond to
issues impacting the city that emerge
during the legislative sessions.

se C it y,”
t of “D iv er
r, is th e h os
and
to
s
ec
m
ir
a
d
gr
on
rv ic es , p ro
in fo rm a ti
se
ic
se
m en t
bl
er
u
rn
p
iv
ve
d
e ci ty ’s go
ez , d ep u ty
m e of th e
th
ir
so
,
m
ts
a
11
R
gh
X
d
li
H
h
D a vi
a t h ig
n in g P
rm a n d
p ro gr a m th ci ty. T h e a w a rd -w in s th a t ed u ca te , in fo
a P H X 11
e
m
a
th
gr
by
ro
d
p
re
ty
of fe
qu a li
a ct iv it ie s
, p ro vi d es
s a w ee k.
e ch a n n el
d a y, 7 d a y
a
rs
ou
a cc es s ca bl
h
24
ts
en
d
si
re
en te rt a in

76

2004-05

2005-06

$1,180,000 $1,291,000 $1,317,000
6.3

6.3

6.3

Source of Funds:

$2,591,000 $1,635,000 $1,647,000

Source of Funds:
General

INTERGOVERNMENTAL PROGRAMS

$1,171,000 $1,279,000 $1,303,000
9,000

12,000

14,000

by the elimination of a deputy city
manager position. The budget also
converts one temporary executive position
and one temporary support position to
regular status.

Expenditure and Position Summary
2003-04 *
Operating Expense
Total Positions

2004-05

2005-06

Water

Expenditure and Position Summary

Program Goal
Intergovernmental Programs represents
the city, as appropriate, in contacts with
federal, state, regional, county and other
city governments. Intergovernmental
Programs also is charged with citywide
grants coordination.

2003-04
Operating Expense
Total Positions

19.0

21.0

21.0

$1,982,000 $1,406,000 $1,355,000
609,000

229,000

292,000

*Prior to 2004-05, the budgets of the various deputy
city managers and their support staff were contained
in several different departments. They have been
consolidated here for purposes of comparison.
Beginning in 2004-05, work order charges to enterprise
and special revenue departments were increased to
more accurately account for staff time allocated to
these departments.

General
Other Restricted

Budget Allowance Explanation
The Intergovernmental Programs 2005-06
operating budget allowance of $1,317,000
is $26,000 or 2.0 percent more than
2004-05 estimated expenditures. This
increase reflects normal inflationary
adjustments and is partially offset by
budget reductions. The budget reduces
funding for legislative consultants, which
will limit the city’s ability to respond to
issues impacting the city that emerge
during the legislative sessions.

se C it y,”
t of “D iv er
r, is th e h os
and
to
s
ec
m
ir
a
d
gr
on
rv ic es , p ro
in fo rm a ti
se
ic
se
m en t
bl
er
u
rn
p
iv
ve
d
e ci ty ’s go
ez , d ep u ty
m e of th e
th
ir
so
,
m
ts
a
11
R
gh
X
d
li
H
h
D a vi
a t h ig
n in g P
rm a n d
p ro gr a m th ci ty. T h e a w a rd -w in s th a t ed u ca te , in fo
a P H X 11
e
m
a
th
gr
by
ro
d
p
re
ty
of fe
qu a li
a ct iv it ie s
, p ro vi d es
s a w ee k.
e ch a n n el
d a y, 7 d a y
a
rs
ou
a cc es s ca bl
h
24
ts
en
d
si
re
en te rt a in

76

2004-05

2005-06

$1,180,000 $1,291,000 $1,317,000
6.3

6.3

6.3

Source of Funds:

$2,591,000 $1,635,000 $1,647,000

Source of Funds:
General

INTERGOVERNMENTAL PROGRAMS

$1,171,000 $1,279,000 $1,303,000
9,000

12,000

14,000

PUBLIC INFORMATION

Program Goal
The Public Information Office
disseminates information on city
governmental services to residents, and
assists them in using and understanding
the information. The office also
encourages participation in city
government, develops programming for
the government access cable television
channel, and encourages motion picture
filmmaking in the city of Phoenix through
planning and coordinating city assistance
to filmmakers.

Public Information –
Economic Impact from Media Productions
Hosted in Phoenix

Millions

$50
$40
30

29

29

29

29

2001-02

2002-03

2003-04

2004-05

2005-06

$30
$20
$10
$ 0

Budget Allowance Explanation

Fiscal Year

The Public Information operating budget
allowance of $3,339,000 is $72,000 or
2.1 percent less than 2004-05 estimated
expenditures. The decrease reflects
reductions in computer consulting,
contract photography services and
weekend and evening shoots. Weekend
station control and news coverage will
be eliminated. The decrease is partially
offset by normal inflationary increases.

Public Information Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$3,269,000 $3,411,000 $3,339,000
32.0

32.0

32.0

Source of Funds:
General
Other Restricted

3,263,000

3,403,000

3,331,000

6,000

8,000

8,000

2004-05*

2005-06

Number of news releases, media advisories
and public service announcements issued

350

350

350

City publications reviewed and produced
(i.e., City Council newsletters, City Page,
City Connection, Notes and various
brochures for city departments)

235

235

235

140
186
19

140
186
21

140
146
21

115

115

115

$29 mil.

$29 mil.

$29 mil.

Phoenix Channel television programs produced
- Standard Programs
- Requested Unscheduled Programs
- Requested Planned Programs
Film/Video permits issued for movies,
television programs, commercials
and still photography
Economic impact of hosted
media productions
*Based on 10 months actual experience.

The projected decrease in requested unscheduled programs reflects the budget reduction
for evening and weekend shoots. The economic impact in movies and television programs
filmed is determined by using the Association of Film Commissioners International
Guidelines.

77

CITY AUDITOR

City Auditor
Impact of Recommendations

Program Goal
The City Auditor Department supports
the city manager and elected officials
in meeting residents’ needs for quality
government, products and services by
providing independent and objective
feedback on the city’s programs, activities
and functions. The city auditor’s work is
vital in maintaining trust and confidence
that city resources are used effectively
and honestly. The City Auditor budget
also funds an annual independent
audit conducted by outside auditors in
accordance with the City Charter. This
includes an audit of city accounting and
financial records, the federal single audit,
review of the City of Phoenix Employees’
Retirement System, external audits of
specific activities and review of business
systems for possible improvements.

Millions
$4
$3

3.4
3.0

2.8

2.8

2004-05

2005-06

2.5

$2
$1
$0
2001-02

2002-03

2003-04
Fiscal Year

City Auditor Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:

Budget Allowance Explanation
The City Auditor 2005-06 operating
budget allowance of $3,048,000 is $246,000
or 8.8 percent more than 2004-05
estimated expenditures. This increase
is primarily due to inflationary
adjustments and an increase in the
cost of the annual independent audit.
These increases are partially offset by
reduction of an internal auditor position.

Operating Expense
Total Positions

2004-05

2005-06

$2,604,000 $2,802,000 $3,048,000
33.5

37.5

37.5

Source of Funds:
General

78

$2,604,000 $2,802,000 $3,048,000

2004-05*

2005-06

Performance audit and management
reports issued

153

165

153

Percentage of commitment dates met

88%

90%

90%

100%

100%

100%

134

125

125

$14,770

$16,000

$16,000

8.6

9.0

9.0

Percentage of rulings issued timely
Audit cycle time (calendar days)
Cost per audit
Customer Satisfaction
(Scale 1 to 10, 10 being highest)

Expenditure and Position Summary
2003-04

2003-04

*Based on 10 months actual experience.
The reduction in 2005-06 performance audit and management reports issued reflects the
elimination of an internal auditor position.

EQUAL OPPORTUNITY

Equal Opportunity Major Performance Measures and Service Trends

Program Goal
The Equal Opportunity Department
promotes and enforces equal opportunities
for both city employees and the general
public through a wide range of voluntary
affirmative action, education, community
involvement and enforcement programs.
These programs are carried out by a
combination of staff and volunteer panels
appointed by the Mayor and City Council.

Budget Allowance Explanation
The Equal Opportunity operating budget
allowance of $3,750,000 is $300,000 or
8.7 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary increases and
replacement of the M/D/W/SBE computer
database. These increases are partially
offset by budget reductions.
Expenditure reductions include
eliminating one equal opportunity
specialist position. This will result
in reduced staff support for various
commission subcommittees and
various outreach efforts.

The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Discrimination complaints in employment,
public accommodations, housing and
Americans with Disabilities Act (ADA)
accessibility, investigated and closed

2004-05*

2005-06

169

161

161

55

55

55

100%

100%

100%

SBEs certified or recertified
as percent of goal

93%

100%

100%

Contracts monitored by for use
of M/W/D/SBE subcontractors

394

394

419

Minority-owned, woman-owned and
disadvantaged and small business enterprise
(M/W/D/SBE) outreach presentations to area
businesses and M/W/D/SBE organizations
M/W/D/SBEs certified or recertified
as percent of goal

*Based on 10 months actual experience.
The decrease in discrimination complaints from 2003-04 may reflect an increase in the
number of training classes provided by the department. Contracts monitored fluctuate
depending on the amount of construction work included in the annual capital program.
Civic Plaza expansion, the light rail project and new concessions at Sky Harbor Terminal 4
will increase monitoring in 2005-06.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$3,491,000 $3,450,000 $3,750,000
37.0

38.0

38.0

Source of Funds:
General

$3,070,000 $2,995,000 $3,341,000

Community Development
Block Grant
196,000

198,000

193,000

Grant

177,000

209,000

168,000

48,000

48,000

48,000

Other Restricted

79

PERSONNEL

Personnel –

Program Goal
The Personnel Department partners
with departments and employees to hire,
compensate, support and develop a diverse
workforce that is dedicated to delivering
high-quality services to the community.

The Personnel Department 2005-06
operating budget allowance of $15,738,000
is $220,000 or 1.4 percent less than
2004-05 estimated expenditures. This
decrease is the result of 2005-06 budget
reductions in the General Fund partially
offset by normal inflationary adjustments.
The 2005-06 budget reductions
include reduced funding for: training and
development consultants and related
training materials; use of training and
testing facilities which charge fees;
remodeling of existing personnel facilities;
advertising for the recruitment of city
positions; imaging of citywide personnel
records; and technical programming
for the personnel/payroll system. Also
included is the elimination of the
RESOLVE mediation program including
a personnel analyst position. These
reductions will decrease the number of
specialized training classes offered to city
employees, require staff to accommodate
multiple testing sessions in the Personnel
Department, potentially diminish the
applicant pool, and cause a slower
turnaround on information requests.
Alternate sources of mediation assistance
will be provided to employees
upon request.

Expenditure and Position Summary

Operating Expense
Total Positions

2004-05

2005-06

$13,920,000 $15,518,000 $15,738,000
113.4

112.4

112.4

Source of Funds:
General

80

75%

73

75

1997

1999

81

83

2001

2003

50%

Budget Allowance Explanation

2003-04

100%

Percent of city employees who agree the city
values diversity in the workplace*

$13,048,000 $14,275,000 $14,520,000

City Improvement

757,000

915,000

1,073,000

Other Restricted

115,000

328,000

145,000

25%
0%
Fiscal Year
*Results from the biennial Employee Opinion Survey.
The next survey is scheduled for Fall 2005.

Personnel Department Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

4.65%

4.50%

4.50%

Average work days from vacancy-to-fill date

112

115

115

Number of recruitment processes

614

590

610

25

27

27

9,118

9,000

9,000

12.7

13.0

13.0

Annualized employee turnover rate

Average work days for recruitment from
opening to creation of eligibility list
Employees participating in city-sponsored
and language classes
Number of industrial claims filed per
each 125 full-time equivalent employees
*Based on 10 months actual experience.

2005-06

PHOENIX EMPLOYMENT
RELATIONS BOARD

RETIREMENT SYSTEMS

Program Goal

Program Goal
The Phoenix Employment Relations
Board oversees administration of the
city’s Meet and Confer ordinance. Primary
responsibilities of the board include
conducting representation elections,
and selecting mediators and fact finders
to resolve impasses. The board consists
of five members appointed by the City
Council and has its own staff consisting
of a director and a secretary.

Budget Allowance Explanation
The Phoenix Employment Relations Board
2005-06 operating budget allowance of
$234,000 is $9,000 or 4 percent more
than 2004-05 estimated expenditures.
This increase is primarily due to normal
inflationary adjustments.

Retirement Systems provides staff support
to the general, police and fire retirement
boards and administers retirement
programs for all city employees.

Budget Allowance Explanation
The Retirement Systems gross operating
budget allowance of $1,739,000 is $122,000
or 7.5 percent more than 2004-05
estimated expenditures. This increase is
due primarily to an increase in medical
exams required for police and fire recruits
in anticipation of a large number of
retirements in those departments, as
well as normal inflationary adjustments.

Expenditure and Position Summary
2003-04
Operating Expense
(Gross*)

Expenditure and Position Summary

Operating Expense
Total Positions

Total Positions

2003-04

2004-05

2005-06

Source of Funds:

$219,000

$225,000

$234,000

General (Gross*)

2.0

2.0

2.0

$219,000

$225,000

$234,000

2004-05

2005-06

$1,374,000 $1,617,000 $1,739,000
15.0

15.0

15.0

$1,374,000 $1,617,000 $1,739,000

*Gross costs are recovered through contributions to the
pension fund.

Source of Funds:
General

81

PHOENIX EMPLOYMENT
RELATIONS BOARD

RETIREMENT SYSTEMS

Program Goal

Program Goal
The Phoenix Employment Relations
Board oversees administration of the
city’s Meet and Confer ordinance. Primary
responsibilities of the board include
conducting representation elections,
and selecting mediators and fact finders
to resolve impasses. The board consists
of five members appointed by the City
Council and has its own staff consisting
of a director and a secretary.

Budget Allowance Explanation
The Phoenix Employment Relations Board
2005-06 operating budget allowance of
$234,000 is $9,000 or 4 percent more
than 2004-05 estimated expenditures.
This increase is primarily due to normal
inflationary adjustments.

Retirement Systems provides staff support
to the general, police and fire retirement
boards and administers retirement
programs for all city employees.

Budget Allowance Explanation
The Retirement Systems gross operating
budget allowance of $1,739,000 is $122,000
or 7.5 percent more than 2004-05
estimated expenditures. This increase is
due primarily to an increase in medical
exams required for police and fire recruits
in anticipation of a large number of
retirements in those departments, as
well as normal inflationary adjustments.

Expenditure and Position Summary
2003-04
Operating Expense
(Gross*)

Expenditure and Position Summary

Operating Expense
Total Positions

Total Positions

2003-04

2004-05

2005-06

Source of Funds:

$219,000

$225,000

$234,000

General (Gross*)

2.0

2.0

2.0

$219,000

$225,000

$234,000

2004-05

2005-06

$1,374,000 $1,617,000 $1,739,000
15.0

15.0

15.0

$1,374,000 $1,617,000 $1,739,000

*Gross costs are recovered through contributions to the
pension fund.

Source of Funds:
General

81

LAW

Program Goal
The Law Department provides effective
legal services to the Mayor and City
Council, city manager, departments and
advisory boards; interprets and enforces
city, state and federal laws as they pertain
to city services and activities; and effectively administers and prosecutes criminal
cases filed in Phoenix Municipal Court
using the prosecutorial function and
discretion in a fair, impartial and
efficient manner.

Budget Allowance Explanation

elimination of a civil attorney assigned
to collect past due taxes as well as
a prosecutor assigned to a Municipal
Courtroom.
The Law Department 2005-06 budget
for court awards funds provides for
computerized legal research ($32,000),
criminal justice training ($4,000) and
computer programming including ongoing
technical support for the Criminal
Division’s case management system
($121,000).

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$19,344,000 $19,610,000 $20,891,000
245.3

242.0

245.0

Source of Funds:
General

$18,255,000 $18,464,000 $19,907,000

Court Awards

123,000

152,000

157,000

Grants

965,000

943,000

678,000

1,000

51,000

149,000

Other Restricted

______________________________________________________________________

Law Department Major Performance Measures and Service Trends
The Law Department 2005-06 operating
budget allowance of $20,891,000 is
$1,281,000 or 6.5 percent more than
2004-05 estimated expenditures. The
increase is due to inflationary adjustments
and the addition of two attorneys and
support staff to initiate acquisition
actions related to the Light Rail and other
projects. Replacement funding was also
added for the Victim’s Rights Program
grant to cover cost-of-living increases, for
the Local Law Enforcement Block Grant
to fund two prosecutors and one legal
assistant, which provides coverage for
one criminal court room, and for the
Community Gun Violence Grant to fund
two prosecutors to prosecute gun crimes
in federal court. The increase is offset by
budget reductions that include reduced
funding for replacement furniture and the

The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Criminal cases sent to diversion

2005-06

3,568

3,208

3,500

59,627

65,000

62,000

1,282

800

800

45,844

42,000

43,000

Number of civil cases closed, including
those assigned to outside counsel and
handled through the alternative
dispute resolution process

804

900

900

Ordinances and resolutions for City
Council adoption drafted and reviewed

1,123

1,000

1,000

381

450

450

Pre-trial disposition conferences set
New civil cases opened in the fields of
condemnation, collection, taxes and civil
litigation, excluding liability and other
cases assigned to outside counsel
Number of defendents submitted
for charging review

Number of jury trials prosecuted
*Based on 10 months actual experience.

82

2004-05*

INFORMATION TECHNOLOGY

Program Goal
The Information Technology Department
coordinates the use of information
technology across the various departments
and agencies of city government to ensure
that accurate and timely information is
provided to residents, elected officials,
city management and staff in the
most cost-effective manner possible.
The department provides operating
departments with information processing
through the application and coordination
of computer technology and procures,
manages and maintains the city’s radio,
telephone and computer network systems.

is included. This could result in the city’s
inability to inform the public of meetings
in a timely manner. The budget
also reduces the scope of the annual
information technology architecture
review, decreasing the ability of the
department to identify possible cost
efficiencies. Elimination of funding for
an audit of a cable service provider is
also included. Eliminating seven
positions associated with court data
entry reductions and other application
programming services also is included.

Expenditure and Position Summary
2003-04

2004-05

2005-06

Operating Expense* $4,470,000 $3,759,000 $6,717,000
Total Positions

213.0

210.0

210.0

Source of Funds:
General

$3,259,000 $2,126,000 $4,989,000

City Improvement

883,000

930,000

Other Restricted

328,000
_

548,000

555,000

155,000

163,000

Aviation

1,010,000

*Reflects net costs; most costs are charged to other
departments for services provided.

Information Technology Major Performance Measures and Service Trends
Budget Allowance Explanation
The Information Technology operating
budget allowance of $6,717,000 is
$2,958,000 more than 2004-05 estimated
expenditures. This increase reflects the
cost to upgrade the personnel and payroll
system, the carryover of maintenance
costs, as well as normal inflationary
increases. This increase also reflects the
return to pay-as-you-go funding for major
equipment purchases in 2005-06.
These increases are partially offset
by budget reductions. A reduction in
the costs associated with the software
conversion of the city’s electronic calendar

The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

Percentage of on-time operations
center services

98.9%

99.0%

99.0%

Number of ITD-supported
network devices

13,179

14,040

14,625

99.7%
99.1%
99.4%
99.9%
99.9%

99.0%
99.5%
99.0%
99.9%
99.9%

99.0%
99.5%
99.0%
99.9%
99.9%

Number of visits to phoenix.gov

10,849,431

11,661,068

15,000,000

Average cycle time of telephone
service requests

2.5 weeks

2 weeks

2 weeks

109,268

107,458

109,587

1.24 hours

1.25 hours

1.25 hours

21,395

22,000

23,000

Critical Systems Availability Percentage:
Enterprise Network
Business Systems
Internet Services
Telephone Network
Microwave Network

Average number of CityCom phone
calls processed daily
Average cycle time of wireless
communication repairs
Units of portable and mobile radio
equipment
*Based on 10 months actual experience.

Increased visits to phoenix.gov are due to the expansion of e-commerce and the increase
in the amount of information provided to citizens by city departments.

83

CITY CLERK AND ELECTIONS

Budget Allowance Explanation

Program Goal

The City Clerk operating budget allowance
of $7,634,000 is $689,000 or 9.9 percent
more than 2004-05 estimated expenditures.
This increase reflects a regularly
scheduled citywide election in 2005,
the carry-forward of funds for replacement
ballot tabulation software and normal
inflationary increases. These increases
are partly offset by budget reductions.
These reductions include elimination
of a position from Special Services,
deferred facility maintenance at the
Records Center and Elections Annex,
reduced development of new e-mail and
calendaring applications, and elimination
of polling place change notification cards.
The reduction in Special Services staff
will create delays in updates of general
information related to elections and
increased response times to citizen
inquiries sent through the city’s Web site.
Polling place change information will
continue to be provided with the sample
ballot sent to all voters.

The City Clerk Department maintains
orderly and accessible records of all city
activities and transactions including
posting all public meeting notifications;
prepares agendas and minutes for City
Council formal meetings; provides for
effective administration of city elections
and annexations; administers liquor,
bingo and regulatory license services;
and provides printing, typesetting,
microfilming, document imaging, office
automation and mail delivery services
to all city departments.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

$6,568,000 $6,945,000 $7,634,000
132.2

129.2

$6,509,000 $6,782,000 $7,468,000

General
City Improvement

59,000

163,000

4.9

4.9

2004-05

2005-06

4
3.1

3.0

2001-02

2002-03

2.8

2

0
2003-04
Fiscal Year
The increase in 2004-05 is the result of a new type of adult entertainer license.

84

129.2

Source of Funds:

City Clerk _
New Business Licenses

Thousands
6

2005-06

166,000

City Clerk Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04
Council formal meetings for which
agendas and minutes are prepared
Minutes prepared on-time
without errors

2004-05*

2005-06

46

47

45

100%

100%

100%

3,241

3,200

3,100

100%

100%

100%

5.9 mil.

5.1 mil.

5.1 mil.

24

24

24

100%

100%

100%

2.3
11.6

3.0
11.5

3.0
11.5

1

1

1

2.2 hours

1.6 hours

2.2 hours

Percent of Enterprise Call Center
questions answered without referral

98%

98%

90%

Customer satisfaction with department

97%

97%

95%

Notices posted in compliance
with open meeting law
Rate of compliance
Water bills and other items
presorted for mailing
Average number of days to process
a business license
Property ownership updates completed
within five working days of receipt
from county
Turnaround times for printing jobs
(number of days):
Rush jobs
Routine jobs
City Council regular and special
elections held
Election time from poll closing to
final results for citywide election

*Based on 10 months actual experience.
The number of Council formal meetings varies each year depending on the need for special
meetings. The budget assumes two special meetings annually. The number of utility bills
presorted for mailing has declined as a result of more customers receiving and paying their
statements over the Internet and because some utility bills have dimensions too large to go
through the presort process. Election results turnaround time decreased in 2004-05 due to
lower voter turnout for a franchise election.

85

FINANCE

Budget Allowance Explanation

Program Goal

The 2005-06 Finance operating budget
allowance of $24,721,000 is $382,000 or
1.6 percent more than 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments and
is partially offset by budget reductions
totaling $738,000.
The budget reductions include
revising cost accounting formulas to
more aggressively allocate administrative
costs to capital projects and enterprise
funds. Also included are reductions for
computer programming related to the
city’s payroll system.
The budget also converts a temporary
procurement manager and a contracts
specialist to regular status. These
positions assist departments in procuring
professional services. In addition, the
budget reflects the transfer of 13 positions
from the Housing Department to the
Finance Department. These positions
will provide grants management for the
Housing programs and will be funded
by Housing funds.

The Finance Department strives to
maintain a fiscally sound governmental
organization that conforms to legal
requirements and to generally accepted
financial management principles;
maintains effective procurement
procedures for commodities and
services; provides for effective treasury
management and a citywide risk
management program; acquires, manages
and disposes of property for public
facilities; provides an effective debt
management program; and provides
financial advisory services for all
city departments.

86

Expenditure and Position Summary
2003-04)

2004-05)

2005-06)

Operating Expense $21,689,000)$24,339,000) $24,721,000)
Total Positions

294.5)

310.5)

310.5)

Source of Funds:
General

$20,318,000)$22,778,000) $22,946,000)

Water

715,000)

840,000)

1,072,000)

Wastewater

603,000)
_)

672,000)

672,000)

67,000)

100,000)

_)

(18,000)
_)

(69,000)
_)

Sports Facilities
Public Housing
City Improvement

53,000)

Finance Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04
Investments by Portfolio:
Treasurer’s Group Portfolio Dollars Invested
Average Yield
Percentage of
three-month U.S. Treasury Bill
Average Life (years)

2004-05*

2005-06

$1,221 mil.
3.58%

$1,210 mil.
3.50%

N/A
N/A

374%
2.3

155%
2.3

110%
N/A

$200 mil.
1.90%

$230 mil.
1.70%

N/A
N/A

198%
.53

110%
.25

110%
N/A

$693 mil.
1.68%

$950 mil.
2.00%

N/A
N/A

176%
.32

110%
.30

110%
N/A

Dollar value of accounts payable
warrants processed

$1.9 bil.

$2.2 bil.

$2.2 bil.

Privilege license tax gross dollars reviewed

$3.7 bil.

$6.0 bil.**

$3.0 bil.

Yield Restricted Portfolio Dollars Invested
Average Yield
Percentage of
three-month U.S. Treasury Bill
Average Life (years)
Other Non-Yield Restricted Portfolio Dollars Invested
Average Yield
Percentage of
three-month U.S. Treasury Bill
Average Life (years)

Bond Ratings:
General Obligation - Standard & Poor’s
General Obligation - Moody’s

AA+
Aa1

AA+
Aa1

AA+
Aa1

Water Revenue - Standard & Poor’s
Water Revenue - Moody’s

AA
Aa3

AA
Aa3

AA
Aa3

Airport Revenue - Standard & Poor’s
Airport Revenue - Moody’s

AAA1

AAA1

AAA1

Senior Lien Street Revenue - Standard & Poor’s
Senior Lien Street Revenue - Moody’s

AA
Aa3

AA
Aa3

AA
Aa3

Senior Lien Excise Tax - Standard & Poor’s
Senior Lien Excise Tax - Moody’s

AAA
Aa2

AAA
Aa2

AAA
Aa2

Risk management claims received and closed

2,942

2,820

3,100

Receivables:
Dollar value of receivables billed
Percentage outstanding (as of June 30)

$434 mil.
4.0%

$450 mil.
4.0%

$450 mil.
4.0%

City sales (excise) tax collected

$542 mil.

$567 mil.

$490 mil.

*Based on 10 months actual experience.
**The decrease from 2004-05 is due to closing assessments on some very large taxpayers
in 2004-05.
The amounts to be invested for 2005-06 are based on cash available during the fiscal year.
Yield performance for each portfolio is measured against the performance of three-month
United States Treasury Bills (T-Bill). The department’s goal is to achieve at least 110
percent of the three-month United States T-Bill yield.

87

BUDGET AND RESEARCH

Budget and Research Major Performance Measures and Service Trends

Program Goal

The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:

The Budget and Research Department
ensures effective, efficient allocation of
city resources to enable the City Council,
city manager and city departments to
provide quality services to our residents.

2003-04
Percent variance of actual expenditures
to estimated expenditures (GF)

The Budget and Research Department’s
2005-06 operating budget allowance of
$4,037,000 is $386,000 or 10.6 percent
more than 2004-05 estimated expenditures.
This increase is due to normal inflationary
adjustments and the addition of the
Impact Fee Program administration.
This increase is partially offset by a
reduction in funding for computer
software maintenance of the city’s
budget reporting enterprise system.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$3,196,000 $3,651,000 $4,037,000
28.0

32.0

32.0

Source of Funds:
General
Other Restricted

88

$3,191,000 $3,341,000 $3,531,000
5,000

310,000

506,000

2005-06

0%

0%

0%

(.8)%

0%

0%

Costs savings and/or operational
improvements identified (millions)

$6.7

$5.5

$5.5

Percent of requested research completed
by due date

85%

85%

85%

8.9

8.5

10.0

93%

95%

95%

Percent variance of actual resources
to estimated resources (GF)

Budget Allowance Explanation

2004-05*

Customer satisfaction with services
(scale of 1-10)
Percent of Capital Improvement
Program awarded
*Based on 10 months actual experience.

ENGINEERING AND
ARCHITECTURAL SERVICES

Program Goal

Number of Projects

The Engineering and Architectural
Services Department provides for the
economical, safe and aesthetic design and
construction of facilities on city property;
coordinates the bid specification
process, including setting minorityand woman-owned subcontractor goals
for all capital improvement construction
projects; and serves as the central
depository for all official records
relating to capital projects.

Engineering and Architectural Services –
Construction Projects Awarded

225

150

100

0
2001-02

2002-03

Number of utility permits requested

Expenditure and Position Summary

Percentage of utility permits reviewed
and approved by target date

2005-06

Operating Expense $11,290,000 $12,092,000 $13,196,000
(Gross*)
Total Positions

105.1

110.1

110.1

Source of Funds:
General (Gross*)
Other Restricted

2003-04

2004-05

2005-06

Fiscal Year

The Engineering and Architectural
Services gross operating budget
allowance of $13,196,000 is $1,104,000 or
9.1 percent higher than 2004-05 estimated
expenditures. The increase is the result
of normal inflationary increases and is
partially offset by General Fund budget
reductions for computer application and
systems support. The budget also reflects
the carry-forward of funds to create record
drawings in the GIS system.

2004-05

90

75

Budget Allowance Explanation

2003-04

130

130
115

$11,290,000 $12,092,000 $13,113,000
_
_
83,000

*The majority of Engineering and Architectural Services’
costs are charged to the appropriate capital
improvement projects.

Engineering and Architectural Services
Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:

Percentage of Capital Improvement Program
projects bid:
First quarter
Second quarter
Third quarter
Fourth quarter
Total
Number of construction contract bids awarded
Number of engineering and architectural
consultant contracts awarded
Construction dollars as a percentage of
total dollars award:
Minority-owned business enterprises
Woman-owned business enterprises
Small business enterprised

2003-04

2004-05*

2005-06

13,070

13,330

13,330

86%

85%

85%

29%
23%
23%
25%
100%

16%
33%
30%
21%
100%

25%
25%
25%
25%
100%

90

130

130

411

310

300

4.2%
2.95%
2.0%

4.0%
3.0%
2.0%

4.0%
3.0%
2.0%

*Based on 10 months actual experience.

89

n
en ts be tw ee
is e a gr ee m
ch
n
a
d
n
fr
a
d
a p p ro ve
ic e (A P S)
N ew vo te ru bl ic Se rv
ty
A ri zo n a P
d
p u bl ic sa fe
n
a
ew
ix
n
n
9
ts
P h oe
l fu n d 19
p ro ve m en
il
w
im
s
a
s,
G
it
t
n
u
e
u
sc
y
re
it
So u th w es
n
vy
ed co m m u
fo r n ew h ea
s, ex p a n d
es .
p os it io n s
ss io n ef fo rt
ca p a bi li ti
re
p
se
p
en
su
ef
e
el a n d d
to cr im
om
h
er
tt
be
nd
p ol ic in g a

90

Public Safety

The Public Safety Program
Represents 30.4% of the Total Budget.

Police Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

Average Response Time (Minutes)
Priority 1 - Emergency Calls
Priority 2 - Non-Emergency Calls
Priority 3 - All Other Calls
Telephone Callbacks
The Public Safety program budget includes
the Police Department, Fire Department,
Emergency Management and Family
Advocacy Center.

5.5
19.6
60.6
70.8

5.5
19.4
61.1
60.5

5.5
19.4
60.9
62.4

Percentage of phone calls to 911 and
Crime Stop answered within 10 seconds

83.2%

84.6%

85.1%

Cases accepted by the county attorney
for issuance of complaint

23,502

20,768

22,136

252,363

256,443

257,126

32,086

32,302

32,220

43%
23%
20%
38%
5%
15%
10%
7%

43%
25%
18%
38%
5%
15%
9%
8%

44%
21%
19%
38%
5%
15%
10%
8%

POLICE
Moving violation citations issued

Program Goal
The Police Department provides the
community with a law enforcement system
that integrates and uses all departmental,
civic and community resources for police
services and protection of the lives and
property of our residents.

Budget Allowance Explanation
The 2005-06 Police operating budget
allowance of $407,588,000 is $14,932,000
or 3.8 percent more than 2004-05
estimated expenditures. This increase is
due to normal inflationary increases and
the additional costs for the 86 sworn and
41 civilian positions funded with the new
franchise agreements between Phoenix
and Arizona Public Service (APS) and
Southwest Gas. The additional positions
will address crime suppression, community
policing, repeat offenders and critical
civilian support positions.
In addition, the 2005-06 budget
adds funding for fuel and non-warranty
maintenance for the new 2001 Bond

Traffic accidents
Percentage of cases cleared:
Murder
Rape
Robbery
Aggravated Assault
Burglary
Theft
Auto Theft
Arson
*Based on 10 months actual experience.

91

Program twin-engine helicopter which is
shared by Police and Fire. The budget also
includes funding necessary to replace
expiring Local Law Enforcement Block
Grant Funds with General Funds to
continue seven evidence technicians and
a criminalist supervisor position in the
police crime lab. Five additional police
officer positions, funded with Aviation
funds, also are included in the budget to
increase patrols at Sky Harbor Airport.
These increases are partially offset
with cost reductions totaling $3,195,000.
These reductions include reduced funding
for printing, office supplies and facilities

maintenance. Also included are funding
reductions for consulting services for the
Violence Prevention Initiative (VIP) and
stand-by pay. The 2005-06 budget also
eliminates six of the 12 police cadet
positions and seven administrative support
positions, replaces the crime lab technical
administrator with an existing police
commander and transfers a portion of
the General Fund costs to the revenues
generated by the new franchise
agreements. Cost savings also were
achieved by shifting the duties of the
court liaison detectives to civilian
positions.

Expenditure and Position Summary
2003-04
Operating Expense

2004-05

$348,067,000 $392,656,000 $407,588,000

Total Positions

3,900.7

4,161.7

7.7

7.2

General

$313,770,000 $347,178,000 $364,049,000

Police Neighborhood
Protection

17,744,000

18,519,000

Grants

10,447,000

19,150,000

7,166,000

3,429,000
_

3,147,000

2,541,000

2,626,000

9,713,000
1,636,000

Court Awards
Public Safety
Enhancement
City Improvement

916,000

_

936,000

964,000

993,000

Civic Plaza

737,000

759,000

782,000

88,000

313,000

294,000

Other Restricted

6.6

6.3

6.2

4
2
0
2002-03

2003-04
Fiscal Year

92

20,414,000

Sports Facilities

6

2001-02

4,160.7

Source of Funds:

Police — Violent Crimes per 1,000 Residents

8

2005-06

2004-05

2005-06

Police — Property Crimes per 1,000 Residents

80

72

71

66

63

62

2003-04

2004-05

2005-06

60
40
20
0
2001-02

2002-03

Fiscal Year

P ol ic e O ff ic
er s N ic k M
a rg io tt a (l
p ro gr a m th
ef t) a n d D
a t h a s su cc
a vi d B ea u
es sf u ll y co
th e d ow n to
ch a m p h el
n n ec te d 13
w n a re a to
p ed cr ea te
0 ch ro n ic a
a m u lt it u
h ea lt h ca re
a
ll y h om el es
d e of se rv ic
, su bs ta n ce
s p eo p le in
es , in cl u d
a bu se tr ea
se rv ic es a
in g d is a bi
n d sh el te r.
tm en t, em
li ty be n ef it
p lo y m en t
s,
se rv ic es , m
en ta l h ea lt
h

93

FIRE

Program Goal

Fire — First Unit Average Response Time

The Fire Department provides the highest
level of life and property safety through
fire prevention, fire control, emergency
medical and public education services.

Minutes

6
4:48

4:52

4:58

4:59

5:00

2001-02

2002-03

2003-04

2004-05

2005-06

4

Budget Allowance Explanation
The 2005-06 Fire operating budget
allowance of $220,124,000 is $28,211,000
or 14.7 percent more than 2004-05
estimated expenditures. This increase
reflects normal inflationary adjustments,
increased funding requirements of the
public safety pension system, as well as the
costs for 66 sworn and 2 civilian positions
funded with revenues from the new
franchise agreements between the city
and Arizona Public Service (APS) and
Southwest Gas. The increases are offset
by some budget cost savings.

2

0
Fiscal Year

th e
n er s w it h
gr a m p a rt
ls ,
ro
P
oo
h
on
sc
,
ti
a
rs
n it y ce n te
s Im m u n iz
u
ot
m
ay
Sh
m
kd
co
by
ee
a
t’ s B
cl in ic s in
a n d la te w
ep a rt m en
u n iz a ti on
w ee ke n d s
m
on
im
T h e F ir e D
re
ee
a
fr
n ic h ou rs
y to of fe r
m a ll s. C li
co m m u n it
sh op p in g
d
g p a re n ts .
n
n
a
ki
ls
or
a
it
w
h os p
m od a te
om
cc
a
to
s
a ft er n oo n

94

The additional positions will staff
three heavy rescues for incidents involving
mass casualties and expanded homeland
security efforts. The new franchise
agreement revenues, which are included
in the Public Safety Enhancement fund,
will also pay the one-time costs of the
advance hire program for anticipated
firefighter retirements.
Reductions in the 2005-06 budget
include deferred hiring of firefighters for
three new bond-funded fire stations.
Station 62 at 99th Avenue and Lower
Buckeye, Station 57 located at 15th
Avenue and Dobbins, and Station 61 at
16th Street and Indian School will be
temporarily staffed with existing adaptive
response companies for three to six
months. In addition, the temporary
middle manager advance hiring
program is eliminated.
Supplemental additions for new capital
facilities also are included in the budget.
These include funding for eight fire
communications operators to address
the increased workload associated with
new fire stations added in recent years.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$172,690,000 $191,913,000 $220,124,000
1,719.2

1,873.2

1,881.2

Source of Funds:
General

$162,176,000 $175,403,000 $198,091,000

Fire Neighborhood
Protection

5,715,000

6,390,000

6,869,000

Development Services

1,915,000

1,799,000

1,943,000

Grants

2,669,000

6,095,000

4,775,000

Other Restricted

182,000

98,000

107,000

City Improvement

33,000

966,000

2,198,000

_

1,162,000

6,141,000

Public Safety
Enhancement

Fire — Percentage of Time First Unit Arrives
on Scene in Four Minutes or Less
40%

35.6

34.2

32.2

31.5

30.0

2003-04

2004-05

2005-06

30%
20%
10%
0%
2001-02

2002-03

Fiscal Year

Fire Department Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Percent of fire and emergency medical
call responses within four minutes

2004-05*

2005-06

32.2%

31.5%

30%

Patient transports to Valley hospitals
via emergency medical vehicles

54,036

54,250

54,800

Percentage of time Advanced Life Support
(ALS) medical calls are responded to with
paramedic units within five minutes

52.2%

51%

51%

Number of fire investigations to determine
cause only

698

730

765

112,282
15,771

115,650
15,950

119,120
16,000

7,665

7,800

8,000

Number of calls by type:
Emergency Medical
Fire
Other (mountain/swift water/
trench/tree rescues/other)
*Based on 10 months actual experience.

95

EMERGENCY MANAGEMENT

Program Goal
The Emergency Management Program
provides the city with the capability to
mitigate, plan for, respond to and recover
from large-scale community emergencies
and disasters as a result of man-made,
technological or natural hazards.

Budget Allowance Explanation
The Emergency Management 2005-06
operating budget allowance of $682,000
is $327,000 or 92.1 percent more than
2004-05 estimated expenditures. This
increase is due primarily to the additional
costs of four positions funded by revenues

Program Goal
The Family Advocacy Center provides
comprehensive, seamless service to
victims of domestic and family violence
and sexual assault through enhanced
coordination, collaboration and
communication among city, county
and community service providers.

Budget Allowance Explanation
Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$226,000

$355,000

$682,000

1.5

6.5

6.5

$226,000
_

$254,000
_

$285,000

_

101,000

95,000

Source of Funds:
General
Public Safety
Enhancement
Grants

96

FAMILY ADVOCACY CENTER

from the new franchise agreements
between Phoenix and Arizona Public
Service (APS) and Southwest Gas.
The increased Public Safety
Enhancement funds will provide four
additional positions including an
accountant, administrative assistant,
secretary, and chemist to ensure
compliance with complicated federal
grant regulations related to homeland
security and emergency preparedness.

302,000

The Family Advocacy Center operating
budget allowance of $1,096,000 is
$67,000 or 6.5 percent more than 2004-05
estimated expenditures. This increase is

due to normal inflationary adjustments
and is partially offset by 2004-05 budget
reductions, which eliminates rent savings
that would have been available to help in
the development of a new facility.

Family Advocacy Center Major Performance Measures and Service Trends

Expenditure and Position Summary

Phone calls received

6,125

4,000**

6,368**

Victim contacts

7,950

7,000

7,350

Services provided 1

2,780

3,824

4,015

Presentation participants

1,100

1,110

1,165

2003-04
Operating Expense
Total Positions

2004-05

The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2005-06

$1,008,000 $1,029,000 $1,096,000
5.0

5.0

5.0

Source of Funds:
General
Other Restricted

$982,000
26,000

$970,000 $1,037,000
59,000

59,000

2004-05*

2005-06

*Based on 10 months actual experience.
Includes shelter placements, orders of protection, financial assistance, counseling services
and medical examinations.
**The number of walk-in clients has increased which has decreased the number of
telephone contacts.
1

P ol ic e d et
ec ti ve s a n
d vi ct im a
to ge th er to
d vo ca te s a
of fe
t th e F a m
ca se s of d om r a u n iq u e, vi ct im -o
il y A d vo ca
ri en te d , co
es ti c vi ol en
cy C en te r
ll a bo ra ti ve
w or k
ce a n d se xu
a p p ro a ch
a l, em ot io
to
nal and p
h y si ca l a bu h a n d li n g
se .

97

ff ic
m in or tr a
s
n gi n g fr om en a lt y of si x m on th
ra
s
se
ca
s
p
le
d
m
n
u
a
t
h
m
en
xi
rt
a
m
a l C ou
go ve rn
ca rr y a m
ix M u n ic ip
n ch of ci ty
n or s th a t
T h e P h oe n
p a ra te br a
th e
m is d em ea
se
1
of
a
ss
y
is
it
la
rt
C
or
to
th e a u th
e. T h e co u
to
n
t
vi ol a ti on s
fi
ec
00
bj
,5
su
,
sy st em
d /o r a $2
in ja il a n
w id e co u rt
of th e st a te
rt
a
p
a
d
an
ou rt .
Su p re m e C

98

Criminal Justice

The Criminal Justice Program
Represents 2.8% of the Total Budget.

Municipal Court Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

2005-06

74,850

77,000

78,000

269,314

285,000

280,000

36.7

36.0

36.0

Average volume of criminal cases with
a pending trial date

2,200

2,000

2,000

Percent of trials/hearings appealed

1.0%

2.8%

2.8%

95.0%

97.0%

97.0%

1.0 days

1.8 days

1.8 days

Criminal filings
Civil filings
Average number of days from arraignment
to hearing for minor traffic cases
The Criminal Justice program budget
includes the Municipal Court
and Public Defender.

Percent of appeals affirmed

MUNICIPAL COURT

Program Goal
The Municipal Court provides with
integrity, to all individuals who come
before this court: equal access,
professional and impartial treatment,
and just resolution of all court matters.

Average cycle time for sending
out restitution and bail refund checks
Average hold time for incoming
information calls to the Customer
Call Center

5.0 minutes

5.0 minutes 5.5 minutes **

*Based on 10 months actual experience.
**The projected increase in hold time is due to expected increases in the volume of calls
related to the new F.A.R.E. program.

Budget Allowance Explanation
The Municipal Court 2005-06 operating
budget allowance of $38,062,000 is
$2,232,000 or 6.2 percent more than
2004-05 estimated expenditures. The
increase is due to normal inflationary

99

increases and is offset by savings in data
entry costs resulting from participation
in the Arizona State Court System Fine,
Fees and Restitution Enforcement
program (FARE).

Days
100

Municipal Court - Average Days from Arraignment
to Adjudication (criminal cases)
91
80

Expenditure and Position Summary
75
2003-04
Operating Expense
Total Positions

2004-05

374.9

Grants
Other Restricted
City Improvement

50
25

$27,264,000 $28,996,000 $30,757,000
14,000

102,000

_

394,000

928,000

1,501,000

4,214,000

5,804,000

5,804,000

0

2001-02

2002-03

2003-04

2004-05

Fiscal Year

se d
m u n it y -b a
rs to a co m
m a n y of
fe
,
re
on
n
ti
ow
la
u
D
te ra n p op
n ’s St a n d
ve
ra
s
te
er te a m
es
Ve
te
el
n
ty ’s h om
r, a vo lu
, th e te rm
h el p th e ci
. T h is y ea
In P h oe n ix
, h el p ed
er
to
ce
d
n
m
or
a
ta
is
gr
is
d
ss
ro
on p
a ti c st re ss
it h le ga l a
m
w
u
s
a
in te rv en ti
im in a l
n
tr
tcr
ra
os
d
te
er fr om p
ro vi d ed ve
e ca se s, h a
p
m
rt
so
ou
in
C
s
d
l
w h om su ff
ip a
rg es , a n
n t ve te ra n
n ix M u n ic
ea n or ch a
bl em s m ea
em
d
ro
p
is
fr om P h oe
l
t
m
ga
g
en
le
m
so lv ed
em p lo y
lv e p en d in
. T h e u n re
a in in g or
th em re so
ts qu a sh ed
ic es , jo b tr
n
rv
a
se
rr
l
a
a
w
ci
t
a rr es
ge of so
ke a d va n ta
co u ld n ’t ta
ie s.
op p or tu n it

100

76

374.9

Source of Funds:
General

76

2005-06

$31,886,000 $35,830,000 $38,062,000
374.9

76

2005-06

PUBLIC DEFENDER

Public Defender Major Performance Measures and Service Trends

Program Goal

The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:

The Public Defender Program provides
legal representation for indigent
defendants in Phoenix Municipal Court.

Budget Allowance Explanation
The 2005-06 operating budget allowance
for the Public Defender Contract
Administrator’s Office of $3,939,000 is
$199,000 or 5.3 percent more than the
2004-05 estimated expenditures. This
increase is primarily due to normal
inflationary adjustments. Budget
reductions reflected in the 2005-06
budget include decreased compensation
for contracted public defender attorneys.

2003-04

2004-05*

2005-06

Defendents charged with misdemeanor crimes
represented in Phoenix Municipal Court

14,765

14,591

14,728

Defendants represented at Jail Court
(first appearance after arrest),
and K-Court (second appearance after
arrest for those not bonding out after their
first appearance)

25,085

24,648

243,266

*Based on 10 months actual experience.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$3,684,000 $3,740,000 $3,939,000
7.6

7.6

7.6

Source of Funds:
General

$3,684,000 $3,740,000 $3,939,000

101

n iz es
m en t or ga
l
on D ep a rt
ti
n to Sc h oo
ta
re
or
d
sp
il
n
h
St re et Tr a
a lk O u r C
ou s
W
e
er
l
th
m
a
u
in
on
n
ti
h
t)
a
h
l In te rn
w or ks w it
or re y (r ig
d
th e a n n u a
gr a m . H e
B ra n d on F
a ve l to a n
in in g P ro
ip a ti on in
a
ic
Tr
rt
m a ki n g tr
a
s,
p
rd
n
a
’s
u
la
G
p
g
ty
in
fe
P h oe n ix
ss
sa
ro
l tr a ff ic
e Sc h oo l C
th ei r sc h oo
D a y a n d th
to ev a lu a te
ts
ic
tr
is
d
sc h oo l
st u d en ts .
l sa fe r fo r
fr om sc h oo

102

Transportation

The Transportation Program
Represents 19.6% of the Total Budget.

Street Transportation Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

153,000

155,000

155,000

Miles of streets per street maintenance
field employee

14.6

14.7

14.8

Percent of scheduled requests for street
maintenance service completed within target

86%

86%

86%

Percent of major/collector street miles with
satisfactory rideability

97%

97%

97%

9,396

9,000

10,300

Customer satisfaction on traffic operations
requests for service (scale 1 to 10)

9.0

9.0

9.0

Number of neighborhoods actively working with
the Neighborhood Traffic Management Team**

299

320

320

Miles of major streets constructed

6.0

8.0

10.0

Customer satisfaction on mid-block
streetlight requests

93%

95%

95%

Street miles swept

The Transportation program budget includes
the Street Transportation Department, the
Aviation Department and Public Transit.

Requests for services completed
by the Operations Division

STREET TRANSPORTATION

Program Goal
The Street Transportation Department
plans for the safe and convenient
movement of people and vehicles on
city streets, effectively maintains the
city’s streets, designs and inspects the
construction of streets to assure they
meet specifications and minimizes street
damage through the control of irrigation
and storm water.

*Based on 10 months actual experience.
**The decrease in 2003-04 is due to vacant positions.

Budget Allowance Explanation
The Street Transportation 2005-06
operating budget allowance of $58,823,000
is $2,205,000 or 3.9 percent more than
2004-05 estimated expenditures. This
increase is primarily due to normal
inflationary adjustments.

103

The budget reduces funding in alley
dust proofing reducing the total number of
annual miles dust proofed from 30 miles
per year to 15 miles per year or 50 percent.
Additionally, the micro-seal program is
reduced by two-thirds resulting in seven
miles being done annually instead of the
current 20 miles. This reduces a less
expensive means of extending the life a
street while providing a smoother ride.
Over time, this reduction may result in
more emergency street repairs and an
increase in public complaints. Other
reductions include decreasing the number
of traffic count studies conducted by
20 percent and decreasing the use
of consultants for environmental
assessments.

Expenditure and Position Summary
2003-04
Operating Expense

2004-05

2005-06

$54,089,000 $56,618,000 $58,823,000

Total Positions

762.7

764.7

764.7

Source of Funds:
General

$25,054,000 $19,518,000 $19,667,000

Arizona Highway
User Revenue

28,685,000

36,606,000

38,680,000

City Improvement

144,000

400,000

399,000

Grant

206,000

34,000

15,000

_

60,000

62,000

Other Restricted

Street Transportation –
Miles Resurfaced and Sealed

Number
of miles

(includes total miles of sealcoat and asphalt overlay)

300
250

220

220

224
186

200

172

150
100
0
2001-02

2002-03

2003-04

2004-05*

2005-06**

Fiscal Year
*Decrease in 2004-05 due to bad weather conditions and price increases
**Decrease in 2005-06 primarily due to budget reductions in the sealcoat program

104

AVIATION

Sky Harbor Airport–
Passengers Arriving and Departing

Program Goal
The Aviation Department provides
the Phoenix metropolitan area with a
self-supporting system of airports and
aviation facilities that accommodate
general and commercial aviation in
a safe, efficient and convenient manner.

Passengers (Millions)

40.2

40

39.4

39

38.2

38
37

36.6

36

Budget Allowance Explanation

35

The Aviation operating budget allowance
of $182,241,000 is $34,440,000 or 23.3
percent more than 2004-05 estimated
expenditures. This increase is largely due
to normal inflationary increases, budget
additions and additional costs associated
with opening the new car rental facility.
The car rental facility costs will be paid
by the tenants and users of the services.
The 2005-06 budget adds seven
employees to maintain the rental car
center and bus maintenance facility.

34
33

32.6

32
31
30
2001-02

2002-03

2003-04

2004-05

2005-06

Fiscal Year

M or e th a n
10 0, 00 0 p a
ss en ge rs tr
A ir p or t ea
a ve l th ro u
ch d a y, w
gh P h oe n ix
it h a d a il y
Sk y H a rb or
ec on om ic
im p a ct of
In te rn a ti on
$7 2 m il li on
al
.

105

The new positions include three airport
operations assistants, an electrician,
building equipment operator, building
maintenance worker, and facility contract
compliance specialist-lead. To meet
increased parking management workload,
four employees consisting of two aviation
supervisors, an account clerk, and records
clerk will be added to the Parking Section.
The Landside Section will add an aviation
supervisor, records clerk and
administrative assistant to address
increased curb management and Lost
and Found Office workload. The Airside
Section will add two operations assistants
to comply with additional Transportation
Security Administration mandates.
The 2005-06 budget also funds the
Operations Division’s new contract
management unit and additional
administrative support staff with five
employees consisting of one personnel
aide, administrative assistant, two
contracts specialists and a project
management assistant.
In addition, the budget allowance
converts four temporary operations
assistants to regular positions, adds
four staff to increase warehouse hours of
operation and funds five police officers to
increase patrol of roadways and airfields
(positions shown in Police Department).

Aviation Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:

Operating Expense
Total Positions

2004-05

769.7

City Improvement

106

_

40.2 mil.

$45.84
$51.36
$61.92

$48.36
$53.88
$64.08

$50.76
$56.76
$62.28

Customer satisfaction with curbside operations

94%

94%

95%

Customer satisfaction with parking operations

93%

93%

95%

$6.53
$8.81
$6.47

$6.94
$9.29
$6.74

$7.08
$9.49
$6.98

Aircraft takeoffs and landings
(Sky Harbor Airport only)

542,648

548,000

550,000

Total international passengers

1,461,487

1,540,000

1,560,000

326,480

330,000

337,000

Air cargo processed (in tons)
*Based on 10 months actual experience.

2005-06

794.7

$133,854,000 $147,801,000 $182,241,000
$8,720,000

39.4 mil.

Gross sales per departing passenger:
Terminal 2
Terminal 3
Terminal 4

Source of Funds:
Aviation

38.2 mil.

Airline rental rates (cost per square foot):
Terminal 2
Terminal 3
Terminal 4

$142,574,000 $147,801,000 $182,241,000
749.7

2005-06

Sky Harbor passengers arriving and departing

Expenditure and Position Summary
2003-04

2004-05*

2003-04

_

PUBLIC TRANSIT

Public Transit–
Average Weekday Bus Ridership

Program Goal
The Public Transit Department strives to
provide improved public transit services
and increased ridership in the Phoenix
urbanized area through the operation of
a coordinated regional fixed route and
paratransit bus transportation system.

Thousands

150
125

139

143

147

2003-04

2004-05

2005-06

129
120

100
75

Budget Allowance Explanation
The Public Transit operating budget
allowance of $166,212,000 is $18,553,000 or
12.6 percent more than 2004-05 estimated
expenditures. This increase is primarily
due to debt service payments for the Light
Rail project, full-year costs of service
added in 2004-05 and inflationary and
contractor increases. The budget also
includes the carry-forward of 2004-05
funds for information technology
improvements. These increases are offset
by General Fund expenditure reductions.

50
25
0
2001-02

2002-03

In fi sc a l y
ea r 20 04 -0
5, a ve ra ge
th a n 14 3, 00
w ee kd a y ri
0.
d er sh ip

Fiscal Year

on ci ty bu
se s w a s m
or e

107

The Transit 2000 budget provides
for increased weekday Dial-a-Ride
service hours. The cost of this service
improvement is being offset by a decrease
in fixed-route service. In addition, the
budget includes funds for additional
“helper” trips to alleviate overcrowded
conditions on popular local routes
($75,000), an extension of Route 3
(Van Buren) from 67th Avenue to the
city limits at 83rd Avenue in order to

allow the city of Avondale to extend
service to Dysart Road ($228,000),
and the addition of staff by converting
a currently contracted position.
The General Fund expenditure
reductions eliminate evening weekday
fixed route service on 12 of 16 routes
between the hours of 10:30 p.m.
and midnight.

Expenditure and Position Summary
2003-04
Operating Expense

2005-06

$119,883,000 $147,659,000 $166,212,000

Total Positions

63.0

86.0

87.0

Source of Funds:
General
Transit 2000

$26,088,000 $25,646,000 $25,146,000
70,509,000

85,781,000

91,648,000

818,000

14,811,000

27,351,000

Local Transportation
Assistance

7,456,000

7,024,000

7,024,000

Other Agency

9,114,000

8,953,000

9,181,000

Grant

5,898,000

5,444,000

5,862,000

City Improvement

P ID
y, T h e R A
ch w ee kd a
es
ea
id
es
-r
m
d
ti
p a rk -a n
a n 2, 60 0
p ri d e fr om
se s m or e th
to
-s
bu
on
ID
n
P
a
A
rs w it h
bo a rd R
a s.
es p a ss en ge
C a p it ol a re
C om m u te rs
ic e p ro vi d
a n d St a te
rv
n
se
w
r
to
te
n
u
co m m
to th e d ow
t th e ci ty
th ro u gh ou

108

2004-05

Public Transit Major Performance Measures and Service Trends
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Cost recovery from fares

2004-05*

2005-06

19.3%

17.3%

16.9%

$24,438

$25,301

$25,397

On-time performance for bus service

91%

91%

92%

On-time performance for Dial-a-Ride
prescheduled service

96%

96%

98%

On-time performance for Dial-a-Ride
on-demand service

63%

60%

64%

Average weekday ridership for bus service

138,859

143,262

147,785

Average weekday ridership for Dial-a-Ride
service

1,195

1,245

1,402

Passengers per revenue mile for bus service

2.35

2.39

2.44

Passengers per revenue mile for Dial-a-Ride
service

0.10

0.10

0.10

Operating revenue (thousands)

*Based on 10 months actual experience.
Dial-a-Ride on-time performance and average weekday ridership are increasing in 2005-06
due to the addition of 12,800 service hours. Average weekday bus ridership is increasing in
2005-06 due to the maturation of additional service added in 2004-05.

109

re la xe d ,
p ro vi d e a
h o a re
cr ea te d to
s
st om er s w
a
w
cu
r
t
te
en
u
en
C
eq
fr
ce
n
in
is ta
t- ti m e or
op m en t A ss
en t fo r fi rs
.
T h e D ev el
en vi ro n m
g
t p ro ce ss es
n
en
ti
a
m
id
op
n on -i n ti m
ci ty ’s d ev el
e
th
h
it
w
r
n ot fa m il ia

110

Community Development

The Community Development Program
Represents 10.1% of the Total Budget.

Development Services Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

2005-06

36,669

55,200

55,200

Single-family permits issued

9,752

13,500

13,500

Multi-family units permitted

3,936

5,050

5,050

20 million

15 million

15 million

$3.2 billion

$4.2 billion

$4.2 billion

302,732

338,000

361,100

84%
99%

75%
96%

80%
97%

10,033

13,400

13,400

117,182

118,000

118,000

9 minutes

10 minutes

10 minutes

Total construction permits issued

Commercial square footage permitted
The Community Development program
budget includes Development Services,
Planning, Business Customer Service
Center, Housing, Community and Economic
Development, Downtown Development
Office, Neighborhood Services
and the HOPE VI Project.

Building permit valuation
Number of inspections
Percent of building safety inspections
performed on scheduled day:
Residential
Commercial

DEVELOPMENT SERVICES

Residential lots submitted for
preliminary review

Program Goal

Counter customers served

The Development Services Department
manages the development approval
process to ensure the construction of
safe buildings and compatible site
improvements that enhance the
urban environment and promote
economic vitality.

Average wait time
*Based on 10 months actual experience.

Changes in single-family permits, multi-family permits and commercial square footage
permitted, and number of inspections are primarily due to market forces. Additional
counter staff has helped maintain wait times; however, the volume of customers served
has increased.

Budget Allowance Explanation
The Development Services operating
budget allowance of $46,986,000 is
$4,285,000 or 10 percent more than
2004-05 estimated expenditures. This
increase results primarily from budget
additions, technology enhancements, the
full year’s cost for mid-year additions,
the carryover of incomplete remodeling
associated with staff increases and normal
inflationary increases. These increases
are partially offset by one-time capital
costs for vehicles, furniture, and computer
programming that occurred in 2004-05.

111

The mid-year budget additions in
2004-05 included increased staff for
residential inspections, new Civil
Inspection and Commercial Infill
Development Teams, and westside
revitalization enhancements.
The 2005-06 budget includes the
addition of staff for scanning of historical
documents to ensure compliance with
state record retention guidelines.
The budget also increases staff to
address workloads in the residential
and commercial plan review, adds counter
support to act as a central liaison for
repayment agreements and provides
additional staff to provide enhanced
services to the development community.

2003-04
Operating Expense

2004-05

400.0

459.0

$2.6

2001-02

2002-03

Development
Services

$36,897,000 $42,401,000 $46,658,000
_
300,000
328,000

$4.2

$4.2

2004-05

2005-06

$2
$1
$0
2003-04
Fiscal Year

112

473.0

Source of Funds:

$3.2
$2.6

2005-06

$36,897,000 $42,701,000 $46,986,000

Total Positions

$5

$3

The Planning Department coordinates
the orderly growth of the city and creates
a quality living environment through
effective comprehensive planning.

Budget Allowance Explanation

Development Services –
Value of Permits Issued

$4

Program Goal

Expenditure and Position Summary

Other Restricted

Billions

PLANNING

The budget also converts temporary
resources to regular staff to more
effectively address on-going workloads
in the site plan review process. The
budget also transfers funding to Other
Restricted Funds to account for the
administration of the new impact
fee program.

The Planning Department’s 2005-06 budget
allowance of $7,219,000 is $869,000 or
10.7 percent less than 2004-05 estimated
expenditures. The decrease is primarily
due to the city’s one-time cost of the
mid-decade census in 2004-05 and normal
inflationary increases offset by budget

The mid-year budget additions in
2004-05 included increased staff for
residential inspections, new Civil
Inspection and Commercial Infill
Development Teams, and westside
revitalization enhancements.
The 2005-06 budget includes the
addition of staff for scanning of historical
documents to ensure compliance with
state record retention guidelines.
The budget also increases staff to
address workloads in the residential
and commercial plan review, adds counter
support to act as a central liaison for
repayment agreements and provides
additional staff to provide enhanced
services to the development community.

2003-04
Operating Expense

2004-05

400.0

459.0

$2.6

2001-02

2002-03

Development
Services

$36,897,000 $42,401,000 $46,658,000
_
300,000
328,000

$4.2

$4.2

2004-05

2005-06

$2
$1
$0
2003-04
Fiscal Year

112

473.0

Source of Funds:

$3.2
$2.6

2005-06

$36,897,000 $42,701,000 $46,986,000

Total Positions

$5

$3

The Planning Department coordinates
the orderly growth of the city and creates
a quality living environment through
effective comprehensive planning.

Budget Allowance Explanation

Development Services –
Value of Permits Issued

$4

Program Goal

Expenditure and Position Summary

Other Restricted

Billions

PLANNING

The budget also converts temporary
resources to regular staff to more
effectively address on-going workloads
in the site plan review process. The
budget also transfers funding to Other
Restricted Funds to account for the
administration of the new impact
fee program.

The Planning Department’s 2005-06 budget
allowance of $7,219,000 is $869,000 or
10.7 percent less than 2004-05 estimated
expenditures. The decrease is primarily
due to the city’s one-time cost of the
mid-decade census in 2004-05 and normal
inflationary increases offset by budget

reductions. Budget reductions include the
elimination of one Geographic Information
System technician, one secretary, and one
planning graphic designer which will
adversely affect the Planning Department’s
ability to provide various information
sources to customers in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$6,551,000 $8,088,000 $7,219,000
77.9

75.9

75.9

Source of Funds:
General

$6,491,000 $7,241,000 $6,433,000

Community Development
60,000
Block Grant
_
Other Restricted

62,000

63,000

785,000

723,000

BUSINESS CUSTOMER
SERVICE CENTER

Program Goal
The Business Customer Service Center
provides technical assistance to customers
in the development process, evaluates and
promotes changes to the development
process for efficient operations, and
administers the Phoenix infill-housing
program.

Budget Allowance Explanation

Village Planning committees supported

15

15

15

Zoning adjustment hearings scheduled
within 25 working days of request**

65%

46%

60%

Formal rezoning pre-application meetings
scheduled within 15 working days of request

87%

69%

70%

Annual cycle General Plan amendments
completed by target date

72%

84%

80%

Zoning verification letters completed
within 10 days**

56%

53%

50%

The Business Customer Service Center
operating budget allowance of $688,000
is $167,000 or 19.5 percent less than
2004-05 estimated expenditures. The
decrease is primarily due to General Fund
expenditure reductions, offset by normal
inflationary increases.
The budget reductions include a
suspension of General-funded residential
building permit fee waivers. The reduction
represents in-fill waivers for approximately
176 houses. The remaining General
Funds provide staff to administer the
enterprise-funded infill program, as well
as provide technical assistance and other
development related activities.

Zoning case recommendations by staff
that were upheld by City Council

96%

95%

95%

Expenditure and Position Summary

Zoning Adjustment Hearing Officer
actions upheld by Board of Adjustment

39%

81%

60%

Planning Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

2005-06

Operating Expense
Total Positions

*Based on 10 months actual experience.

Source of Funds:

**The decline in 2004-05 is due to a significant increase in cases and staff vacancies.

General

2003-04

2004-05

2005-06

$838,000

$855,000

$688,000

4.0

4.0

4.0

$451,000

$465,000

$298,000

Water

193,000

195,000

195,000

Wastewater

194,000

195,000

195,000

113

reductions. Budget reductions include the
elimination of one Geographic Information
System technician, one secretary, and one
planning graphic designer which will
adversely affect the Planning Department’s
ability to provide various information
sources to customers in a timely manner.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$6,551,000 $8,088,000 $7,219,000
77.9

75.9

75.9

Source of Funds:
General

$6,491,000 $7,241,000 $6,433,000

Community Development
60,000
Block Grant
_
Other Restricted

62,000

63,000

785,000

723,000

BUSINESS CUSTOMER
SERVICE CENTER

Program Goal
The Business Customer Service Center
provides technical assistance to customers
in the development process, evaluates and
promotes changes to the development
process for efficient operations, and
administers the Phoenix infill-housing
program.

Budget Allowance Explanation

Village Planning committees supported

15

15

15

Zoning adjustment hearings scheduled
within 25 working days of request**

65%

46%

60%

Formal rezoning pre-application meetings
scheduled within 15 working days of request

87%

69%

70%

Annual cycle General Plan amendments
completed by target date

72%

84%

80%

Zoning verification letters completed
within 10 days**

56%

53%

50%

The Business Customer Service Center
operating budget allowance of $688,000
is $167,000 or 19.5 percent less than
2004-05 estimated expenditures. The
decrease is primarily due to General Fund
expenditure reductions, offset by normal
inflationary increases.
The budget reductions include a
suspension of General-funded residential
building permit fee waivers. The reduction
represents in-fill waivers for approximately
176 houses. The remaining General
Funds provide staff to administer the
enterprise-funded infill program, as well
as provide technical assistance and other
development related activities.

Zoning case recommendations by staff
that were upheld by City Council

96%

95%

95%

Expenditure and Position Summary

Zoning Adjustment Hearing Officer
actions upheld by Board of Adjustment

39%

81%

60%

Planning Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

2005-06

Operating Expense
Total Positions

*Based on 10 months actual experience.

Source of Funds:

**The decline in 2004-05 is due to a significant increase in cases and staff vacancies.

General

2003-04

2004-05

2005-06

$838,000

$855,000

$688,000

4.0

4.0

4.0

$451,000

$465,000

$298,000

Water

193,000

195,000

195,000

Wastewater

194,000

195,000

195,000

113

HOUSING

Program Goal
The Housing Department provides and
promotes diversified living environments
for low-income families, seniors and
persons with disabilities through the
operation and leasing of assisted and
affordable housing.

Budget Allowance Explanation
The Housing operating budget allowance
of $77,344,000 is $2,849,000 or 3.8 percent
more than 2004-05 estimated expenditures.
The increase primarily results from the
carry-forward of unspent grant fund
allocations, additional HOME Investment
Program and CDBG allocations, and
normal inflationary increases. These
increases are partially offset by significant
reductions in the Conventional/Public
Housing and Section 8 programs due
to no-growth federal revenues. Also
contributing to the reduction are one-time
2004-05 costs in the Affordable Housing
program for major repairs at several
properties
The budget reduces the
Conventional/Public Housing program
by $3.6 million and 51 positions.
Decreased funding for various contractual,
commodity, and equipment costs and the
reduction of administrative, maintenance,
and supervisory positions are included.
Fewer staff will be onsite to respond to
resident concerns and maintenance
activities will be performed on a less
timely basis. All health and safety needs
will continue to be met as a first priority.
The Section 8 program is reduced
in the budget by $1.1 million and 19
positions. The reduction of support and
supervisory positions, as well as processing
and inspection staff, is included.
Processing teams will be consolidated
and caseloads will increase. Walk-ins
will no longer be accommodated, and
tenant-landlord issues will be referred
to other resources. Additional process
improvements will be pursued to maintain
lease-up rates for Section 8 vouchers.

114

Administrative reductions including
staff support for accounting, technology
support, and applications processing
services are also included. The wait
list will be closed and courtesy landlord
listings will no longer be provided.
Administrative processes will be
streamlined. A total of 18 support
positions are reduced. Costs for these
positions are allocated to various
programs and are included in the
program reduction amounts above.
Also, as part of a reorganization of
the Housing Department, 13 accounting
positions are transferred to the Finance
Department in 2005-06.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions
Source of Funds:
Public Housing
HOME Grant
Community
Development
Block Grant
General
Other Restricted
City Improvement

2004-05

2005-06

$66,236,000 $74,495,000 $77,344,000
235.3
137.7
137.7
$60,485,000 $61,463,000 $58,452,000
3,866,000 10,208,000 15,076,000

833,000
162,000
816,000
74,000

893,000
170,000
1,695,000
66,000

3,203,000
174,000
367,000
72,000

Housing Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

Affordable housing units for families
and individuals

1,359

1,359

1,359

Rental assistance provided for low-income
residents in the private housing market

5,269

5,320

5,320

City-owned and operated public housing
units for families and seniors

2,564

2,561

2,493

99.75%

100%

100%

98.0%

97.95%

98.0%

Percent of Section 8 vouchers under lease
Occupancy rate for public housing units
*Based on 10 months actual experience.

The number of Section 8 vouchers has increased by 51 for a total of 5,320 in 2004-05 due to
the addition of the Desert Crest Apartments into the city’s Section 8 program. The number
of city-owned housing units decreases in 2005-06 when the last Matthew Henson units are
demolished as a result of the new HOPE VI rehabilitation project currently in progress.
Due to the demolition of the last remaining units at the Matthew Henson/HOPE VI project
site, the number of Conventional Housing units will be decreasing by 78 units, as planned,
in 2005-06. Scattered Sites housing sold three houses in 2004-05 to reflect an inventory of
430 units and is expected to purchase 10 homes for the program in 2005-06.
As a final note, major service level trends for rental assistance and lease-up and occupancy
rates reflect the department’s commitment to continue providing low-cost housing to the
community in spite of budget cuts. Other sources not reflected here, such as maintenance
of the wait list, accommodations of “walk-ins” for Section 8 clients, and frequency of lower
priority maintenance tasks at city-owned housing sites will be impacted by these cuts.
Given the magnitude of these budget reductions, performance measures for the Housing
Department will be significantly restructured.

COMMUNITY AND
ECONOMIC DEVELOPMENT

Program Goal
The Community and Economic
Development Department creates or
facilitates development activities that
add or retain jobs, enhances city
revenues and enhances the quality of
life including business development in
Sky Harbor Center and other
non-redevelopment areas.

Budget Allowance Explanation
The Community and Economic
Development operating budget allowance
of $8,134,000 is $754,000 or 8.5 percent
less than 2004-05 estimated expenditures.

This decrease is due primarily to General
Fund expenditure reductions, a one-time
reallocation of Community Development
Block Grant funds in 2004-05, the
completion of the Enterprise Community
program in 2004-05, and the department
becoming eligible to charge certain
expenses to the Workforce Investment Act
grant in the Human Services Department.
This decrease is partially offset by normal
inflationary increases and an increase in
debt service payments.
The General Fund expenditure
reductions include funds for marketing
and promotion of the city as an
employment base and various
economic studies. Reduced promotion
of Phoenix could result in fewer jobs
added to our future economic base.

Expenditure and Position Summary
2003-04
Operating Expense

2004-05 *

$13,068,000 $8,888,000

Total Positions

50.0

2005-06
$8,134,000

36.0

36.0

$5,642,000 $2,685,000

$2,754,000

Source of Funds:
General
Community
Development
Block Grant

1,603,000

1,663,000

1,134,000

City Improvement

3,623,000

2,240,000

2,754,000

Sports Facilities

291,000

117,000

40,000

Aviation

429,000

499,000

438,000

Water

486,000

500,000

525,000

Civic Plaza

519,000

132,000

135,000

Grant Funds

353,000

813,000

217,000

Community
Reinvestment

104,000

219,000

117,000

18,000

20,000

20,000

Other Restricted Funds

*Reflects the department reorganization and the
establishment of the Downtown Development Office as
a separate unit.

Economic Development Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04
Projected jobs created/retained within
the city of Phoenix as a result of
department efforts

2004-05*

2005-06

7,732

6,918

6,900

Loan applications approved for the
Expand Collateral Loan Assistance Program

12

12

12

Estimated sales tax generated from projects

$18,935,538

$22,609,389

$23,650,899

Projected average annual salary for new jobs
with companies newly located in Phoenix

$35,727

$38,853

$38,000

*Based on 10 months actual experience.

115

DOWNTOWN
DEVELOPMENT OFFICE

Program Goal
The Downtown Development Office creates
or facilitates development activities that
add or retain jobs, enhances city revenues
and enhances the quality of life in the
downtown redevelopment area.

Budget Allowance Explanation

Expenditure and Position Summary

The Downtown Development Office
operating budget allowance is $21,919,000.
The budget includes normal operating
costs as well as new costs associated with
the downtown hotel development project.
These increased costs are partially offset
by General Fund expenditure reductions.
The General Fund expenditure
reductions include funds for sponsorship
of conferences and professional
development, bio-industry attraction
activities, and services related to the
department’s implementation of the
newly adopted Downtown Strategic Plan.

Downtown Development Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Number of development/redevelopment
projects in process

2004-05*

2005-06

38

32

39

$353,500

$930,800

$1,036,100

Number of residential units created

N/A

68

159

Projected jobs created downtown
as a result of department efforts

N/A

150

43

Estimated construction value of
projects (in millions)

*Based on 10 months actual experience.
Estimated construction value of projects and number of residential units created are
new measures. The increase in residential units in 2005-06 is due to the opening of the
Orpheum Lofts. The decrease in number of jobs created in 2005-06 reflects the opening
of the TGen building in 2004-05.

116

2003-04*

2004-05

2005-06

Operating Expense

N/A $3,755,000 $21,919,000

Total Positions

N/A

16.0

16.0

Source of Funds:
General

N/A $3,252,000 $3,396,000

Sports Facilities

N/A

102,000

Civic Plaza

N/A

City Improvement

N/A

401,000
417,000
_ 18,000,000

106,000

*The Downtown Development Office was included in the
Community and Economic Development Department in
2003-04.

NEIGHBORHOOD SERVICES

Neighborhood Services _
Neighborhood Preservation Case Cycle Time

Program Goal
To preserve and improve the physical,
social and economic health of Phoenix
neighborhoods, support neighborhood
self-reliance and enhance the quality of
life of residents through community-based
problem solving, neighborhood-oriented
services and public/private cooperation.

Budget Allowance Explanation
The Neighborhood Services operating
budget allowance of $47,080,000 is
$15,956,000 or 51.3 percent more than
2004-05 estimated expenditures. The
General Fund budget of $14,512,000 is
$1,505,000 or 11.6 percent more than the
2004-05 estimated expenditures. The
General Fund increase primarily reflects
the carry-forward of unspent but
committed Fight Back funds and
normal inflationary increases.

Calendar Days
100
84

83

75

67

64

64

2002-03

2003-04

2004-05

50
25
0
2000-01

2001-02

Fiscal Year

T h e N ei gh
bo rh oo d Se
rv ic es D ep
re si d en ts
a rt m en t of
ke ep th ei r
fe rs ti p s a
p ro p er ti es
n d re so u rc
a n d n ei gh
es to h el p
bo rh oo d s
w el l- m a in
ta in ed .

117

These increases are offset by
budget reductions. The budget reduces
supervisory staff in the code enforcement
and neighborhood coordination areas,
decreases contractual funding for
abatement activities, and reduces
department software and training funds.
These reductions could impact customer
service levels and case cycle times. The
budget also eliminates General Funds in
the Capital Improvement Program for
large-scale blight elimination projects,
reducing the department’s ability to
revitalize neighborhoods.
The increase in all grant programs,
including federal/state grants, HOME
Investment Program and CDBG reflects
the carry-forward of unspent grant funds.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$29,297,000 $31,124,000 $47,080,000
228.0

232.0

232.0

Source of Funds:
General
Community
Development
Block Grant

$12,169,000 $13,007,000 $14,512,000

13,033,000 14,762,000

25,094,000

Grant

2,360,000

1,622,000

2,320,000

HOME Grant

1,709,000

1,650,000

5,076,000

26,000

83,000

78,000

Other Restricted

Neighborhood Services Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04
Residents who receive
landlord/tenant counseling

2004-05*

2005-06

7,590

9,500

9,650

617

658

660

$8,635,406

$10,750,000

$29,703,000

33,462

40,766

44,000

Homeowner-occupied housing
rehabilitation projects completed

580

460

420

Percent of neighborhood preservation
cases resolved voluntarily

86%

84%

84%

Neighborhood preservation average response
time from first call to initial inspection for
occupied/non-hazard cases (in calendar days)

10

10

11

Neighborhood preservation average response
time from first call to initial inspection for
vacant/non-hazard/other non-pre-notification
cases (in calendar days)

6

5

6

Properties acquired/demolished/redeveloped
for neighborhood revitalization purposes

82

123

120

Neighborhood cleanup/resident
meetings facilitated
Dollar value of infrastructure and
development projects completed
Sites where graffiti was removed
through the Graffiti Busters Program

*Based on 10 months actual experience.
Increased tenant counseling numbers are due to full staffing levels. The estimated dollar value
of infrastructure and development projects includes both private participation and as well as
city contributions. The estimated value for 2005-06 projects includes two major residential
development projects, Beazer and Trend Homes, as well as various storefront projects. These
projects also impact the number of Infill Houses constructed. Additional outreach/education
activities have increased graffiti awareness in neighborhoods. This has resulted in a higher level
of cleanup requests. The number of homeowner-occupied housing rehabilitation projects
decrease in 2004-05 is due to a shift in community need for higher cost emergency assistance
projects. The decrease in 2005-06 is due to a potential reduction in HUD funding. Increase in
rental rehabilitation units in 2005-06 is based on increased demand from community.
Neighborhood preservation case cycle times decline in 2005-06 due to budget reductions in
Neighborhood Preservation area.

118

HOPE VI PROJECT

Budget Allowance Explanation

Program Goal

The Hope VI Project 2005-06 gross
operating budget allowance of $858,000 is
$65,000 or 8.2 percent more than 2004-05
estimated expenditures. This increase
reflects normal inflationary adjustments.
The operating budget includes the
conversion of a temporary accountant IV
position to regular status to ensure
financial management is provided until
project completion. Costs for this position
are already reflected in the budget and do
not require additional funds.

The Hope VI Project will reconstruct the
obsolete Matthew Henson public housing
site and provide mixed-income home
ownership and rental opportunities to
residents, while providing supportive
services to enhance self-sufficiency, and
to encourage business development in
the central city south area.

Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$988,000

$793,000

$858,000

9.5

9.5

9.5

$988,000

$793,000

$858,000

Source of Funds:
Federal Grants

In 20 01 , th
e ci ty of P
h oe n ix re ce
of H ou si n
iv ed a $3 5
g a n d U rb
m il li on gr
a n D ev el op
by re m ov in
a n t fr om th
m en t to re
g th e ex is ti
e U .S . D ep
vi ta li ze th
n
g u n it s a n
lo w -i n co m
a rt m en t
e M a tt h ew
d bu il d in g
e, el d er ly
H en so n C om
a n d si n gl est a te -o f- th
m u n it y
e- a rt , m ix
fa m il y re si
ed -u se h ou
d en ts .
si n g fo r

119

er a te s
Se ct io n op
g A qu a ti c
in
fl u m e
n
in
in
tw
-w
t' s a w a rd
t fe a tu re s
a
en
th
m
rt
ty
a
li
e
ep
ci
a ti on D
om , tu m bl
f- th e- a rt fa
a n d R ec re
te r m u sh ro
is a st a te -o
a
l
w
o
oo
l,
ls
P
el
a
T h e P a rk s
l
w
os
ec
te d iv e
. T h e p oo
ty w id e. P
tr y, se p a ra
gi n g ro om
ti es .
28 p oo ls ci
m il y ch a n
ro -d ep th en
fa
ze
it h d is a bi li
a
a
w
,
d
n
es
le
a
p
id
eo
re
p
tu
r
a
fo
fe
w a te r sl
r
ir
a te
ee lc h a
a rb u rs t w
er si bl e w h
bu ck et s, st
ft a n d su bm
li
ir
a
ch
a
fe a tu re s

120

Community Enrichment

The Community Enrichment Program
Represents 12.3% of the Total Budget.

PARKS AND RECREATION

Program Goal
The Parks and Recreation Department
provides and maintains a diverse parks
and recreation system available and
accessible to all, which contributes to the
physical, mental, social and cultural needs
of the community and permits outlets that
cultivate a wholesome sense of civic pride
and social responsibility.

The Community Enrichment program
budget includes Parks and Recreation;
Library; Golf; Civic Plaza Convention and
Theatrical Facilities; Human Services;
Education and Youth Programs;
International and Sister Cities Programs;
Rio Salado; Historic Preservation Office;
and the Office of Arts and Culture.

Budget Allowance Explanation
The 2005-06 Parks and Recreation
operating budget allowance of
$102,063,000 is $6,503,000 or 6.8 percent
more than 2004-05 estimated expenditures.
This increase is due to inflationary
adjustments, the full year’s operating
costs for facilities opened in 2004-05,
and operating costs for new or expanded
facilities opening in 2005-06. These

increases are partially offset by the effect
of budget reductions effective the last
month of fiscal year 2004-05. This
increase also is due to the carry-forward
of funds to complete remodeling projects
started in 2004-05 and for continued
implementation of the city’s Dust
Control Program.
These reductions include reduced
funding for ground maintenance and
recreation programming at parks citywide
by eliminating seven regular maintenance
positions and 30 part-time recreation
positions. This will impact the
department’s ability to maintain parks
and remove graffiti from park facilities in
a timely fashion. Due to previous budget
cuts in these areas, the overall appearance
of park facilities will further deteriorate.
Recreation programming will be provided
based on demand and participation
levels and focus primarily on the
11 regional parks and the larger
of 48 community parks.

Summer Recreation and After-School Programs _
Number of Participants

Millions
8

7.1

7.1

7.1

7.2

2002-03

2003-04

2004-05

2005-06

6.7
6

4

2

0
2001-02

Fiscal Year

121

The budget also eliminates 10
positions associated with the reduction of
community center hours by an average
of 16 hours per week. Community centers
would be opened for 49 to 68 hours
compared to the current 65 to 82 hours.
Small centers with already limited hours
would not be affected.
Additionally, the budget eliminates
6.2 staff positions supporting the City
Streets Program, reducing the program
by 50 percent. Remaining funding will
support active Teen Councils, the Teen
Parks Board, the Annual Teen Conference,
the Summer Volunteer Program and a
small number of other high participation
neighborhood events. The closure of city
pools one week earlier from the current
schedule is also included. The summer
swimming season would be reduced
from 10 to nine weeks, eliminating
5.7 part-time aquatics positions.
A reduced level of available federal
grant funds is also included in the budget.
Federal grant funds for the Young First
Offender Program, AIM Program and
Daring Adventures Program have expired.
The budget provides for additional staff
and operating costs to open and maintain
new or improved park facilities ($953,000)
constructed with Parks and Preserve
Initiative funds, 2001 bond funds, and
other funds. These facilities include the
Phoenix Art Museum, Memorial Hall at
Steele Indian School Park, Indian Bend

Wash Park, a community park at 17th
Avenue and Peoria Avenue, the HOPE VI
Coleman Recreation Center and park,
Cesar Chavez Park, the Bethany Home
Outfall Channel and Camp Colley.
The budget also provides staff and other
operating costs for street landscaping
maintenance of new streets citywide. Also
included in the budget is additional staff to
maintain new landscaping surrounding the
new car rental facility at Sky Harbor
Airport. Costs for these positions will be
charged to the Aviation Department.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$86,398,000 $95,560,000 $102,063,000
1,502.7

1,513.2

1,528.4

Source of Funds:
General

$81,063,000 $88,240,000 $94,751,000

Other Restricted

2,393,000

3,495,000

City Improvement

1,252,000

1,393,000

3,515,000
1,493,000

Grant

1,094,000

1,857,000

1,711,000

Civic Plaza

324,000

305,000

312,000

Parks and Preserves

154,000

161,000

171,000

Golf

118,000

109,000

110,000

Parks and Recreation Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

Acres maintained:**
Developed parks
Undeveloped park land
Parkways and medians
Preserves/desert parks

4,374
3,871
872
29,894

4,409
3,836
916
29,353

4,445
3,802
940
29,353

Cost per acre for annual maintenance:
Developed parks
Undeveloped park land
Preserves/desert parks

$6,149
$1,687
$167

$6,676
$1,863
$186

$7,110
$2,019
$200

2.94

3.06

3.04

Number of volunteer hours

211,000

244,000

250,000

Youth Development participants***

134,000

195,000

195,000

Aquatic participants

812,000

800,000

800,000

27,345,000

29,100,000

30,900,000

Acres of developed parks per
1,000 population

All other recreation services
participants****
*Based on 10 months actual experience.

**Park acreages for 2003-04 and 2004-05 have been adjusted. The new figures include
newly acquired parcels, changes in undeveloped park sites to developed facilities and
other adjustments necessary to accurately reflect the total acreage under the department’s
control.
***The decrease in 2003-04 is due to the transfer of two youth centers to the South
and Northeast Districts.
****Excludes summer and after-school, youth development, aquatics and golf participants.

122

LIBRARY

Library _ Annual Circulation per Capita

Program Goal
The Library provides information and
resources that are relevant, accessible
and responsive to the intellectual needs
and interests of the community.

Items Circulated
10
8.6
8

7.9

8.9

9.4

8.3

6

Budget Allowance Explanation
The Library 2005-06 budget allowance of
$34,550,000 is $2,903,000 or 9.2 percent
more than 2004-05 estimated expenditures.
The increase is due to inflationary
adjustments, and the full year’s operating
costs for the new Palo Verde and Desert
Broom branch libraries, which opened in
mid 2004-05. These increases are offset
by a reduction in funding for furniture

4
2
0
2001-02

2002-03

2003-04

2004-05

2005-06

Fiscal Year

T h e F ir st
F iv e Ye a rs
a re a a t B u
on e- of -a -k
rt on B a rr
in d p la ce
C en tr a l L ib
to p re p a re
sp a ce s in cl
ra ry gi ve s
th ei r ch il d
ude a pad
p a re n ts a
re n fo r re
d ed su rf a ce
a n d to d d le
a d in g su cc
w it h a cc es
rs .
es s. It s in
s to bo ok s
te ra ct iv e
a n d m a gn
et s fo r in fa
n ts

123

replacement and equipment at the
Burton Barr Central Library. The budget
also reflects a delay in the opening of the
new Cesar Chavez Regional Library from
April 2006 to July 2006.

Library Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$28,998,000 $31,647,000 $34,550,000
383.8

420.0

420.0

Source of Funds:
General
City Improvement
Grants
Other Restricted

$28,387,000 $30,734,000 $33,360,000
_
_
328,000
184,000

344,000

373,000

99,000

569,000

817,000

2004-05*

2005-06

Number of library visitors served

4,236,579

4,301,600

4,516,000

Number of electronic visits

7,026,269

10,377,000

12,452,000

Annual budget for purchase of
library materials

$4,676,904

$4,995,000

$5,203,000

Cost per library visitor served

$6.77

$7.36

$7.58

2,569,869
8,959,604

2,714,000
9,622,232

2,486,958
10,473,370

$2.49

$2.56

$2.67

Circulation per library visit

2.72

2.87

2.84

Collection turnover rate

5.63

5.67

5.63

72.7%

72.0%

72.0%

2,047,973

2,177,230

2,303,530

113,528

108,421

110,590

Number of items circulated:
Central
12 Branches
Cost per item circulated

Library card registration as a
percentage of population
Number of books in stock
Number of telephone reference
requests answered**
*Based on 10 months actual experience.

**Hours of public service per week were reduced to 858 beginning March 31, 2003.

124

GOLF

City Golf Courses _
Rounds of Golf Played

Program Goal
The Golf Program provides quality
golf services 365 days a year on a
self-sustaining basis to residents
and visitors.

Thousands
600
500
439
400

Budget Allowance Explanation

395
347

346

350

2003-04

2004-05

2005-06

300

The Golf Program 2005-06 operating
budget allowance of $5,965,000 is
$16,000 less than the 2004-05 estimated
expenditures. This decrease is due to
the unusually high number of emergency
infrastructure repairs required in 2004-05
and the expiration of grant funds.

200
100
0
2001-02

2002-03

Fiscal Year

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$5,437,000 $5,981,000 $5,965,000
115.5

115.5

115.5

Source of Funds:
Golf
City Improvement
Grant

Golf Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:

$5,389,000 $5,976,000 $5,965,000
_
_
36,000
12,000

5,000

2003-04

_

Acres of golf courses maintained

2004-05*

2005-06

922

922

922

Annual cost of maintenance per acre

$4,884

$5,433

$5,350

Cost per participant

$15.58

$17.31

$17.03

*Based on 10 months actual experience.

125

CIVIC PLAZA CONVENTION
AND THEATRICAL FACILITIES

Program Goal
The Civic Plaza Convention and Theatrical
Facilities Department encourages
organizations to hold conventions and
trade shows in Phoenix, and facilitates
activities that expand the leisure time
activities for the general public by
providing diversified entertainment and
cultural programs in downtown Phoenix.

Budget Allowance Explanation

The increase is primarily a result of
inflationary increases and an increase in
the Greater Phoenix Convention & Visitors
Bureau contract due to increased revenues
resulting from a recovering economy.
The budget also includes the carry-forward
of 2004-05 funds for painting the Patriot’s
Square garage. The increase is partially
offset by reductions in General Fund
expenditures.
The General Fund reductions include
reduced improvements to General Fund
parking garages. These reductions
will result in less efficient lighting of
the garages.

Expenditure and Position Summary
2003-04
Operating Expense

2005-06

$31,528,000 $33,232,000 $36,048,000

Total Positions

205.4

205.4

208.4

Source of Funds:
Civic Plaza

$27,462,000 $25,409,000 $28,298,000

General

1,862,000

1,943,000

1,995,000

City Improvement

1,641,000

1,680,000

1,556,000

563,000

4,200,000

4,199,000

Sports Facilities

The Civic Plaza Convention and Theatrical
Facilities operating budget allowance of
$36,048,000 is $2,816,000 or 8.5 percent
more than 2004-05 estimated expenditures.

ti on a ll y
er 20 03 n a
ob
ct
O
e
th
te of
w a s th e si
te s.
m T h ea te r
l ca n d id a
T h e O rp h eu oc ra ti c p re si d en ti a
em
D
fe a tu ri n g

126

2004-05

eb a te
te le vi se d d

Civic Plaza Convention and Theatrical Facilities Major Performance Measures
and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Estimated direct spending impact from
conventions (millions)

2004-05*

2005-06

$83.9

$92.1

$99.0

Number of conventions

40

49

53

Number of local public shows

43

40

41

Percent square feet occupancy (all events)

67%

68%

62%

Number of theatrical performances

348

251

254

387,089

228,000

321,500

Total parking revenue (millions)

$6.7

$6.3

$5.8

Revenue per parking space

$853

$829

$759

Operating expense per parking space

$533

$692

$706

Total theater attendance

*Based on 10 months actual experience.
Economic benefit of events may vary with the size, duration, type and length of event.
Estimated direct spending impact is reported by the Greater Phoenix Convention and
Visitors Bureau. Estimated direct spending impact and the number of conventions is
increasing in 2005-06 due to a concentrated effort to book smaller conventions in order to
utilize the existing space during the expansion. Theater attendance is increasing in 2005-06
due to the re-opening of Symphony Hall and its greater seating capacity in comparison
to Orpheum Theater, which was being used in 2004-05 while Symphony Hall was being
renovated.

127

HUMAN SERVICES

Human Services _
Meals Served by Senior Nutrition Program
Thousands
600

550

583

584

598

Program Goal
598

500

The Human Services Department
promotes self-sufficiency by providing
a wide array of services that foster
the economic, physical and social
well-being of residents.

400

Budget Allowance Explanation

300
200
100
0
2001-02

2002-03

2003-04
Fiscal Year

2004-05

2005-06

The Human Services operating budget
allowance of $71,661,000 is $1,381,000 or
1.9 percent less than 2004-05 estimated
expenditures. This reduction is primarily
due to transferring pass-through
Continuum of Care grant funds from the
city directly to the service-providing
agencies. The budget also reflects normal
inflationary adjustments.
General Fund reductions included in
the 2005-06 budget include reducing

rv ic es
u n se li n g se
ge m en t, co
a
m en ts ,
n
y
a
a
m
p
se
ty
li
re n t, u ti
p ro vi d e ca
g,
rs
in
te
h
n
ot
ce
cl
e
,
ic
w it h fo od
fa m il y se rv
a ss is ta n ce
T h e ci ty ’s
fi n a n ci a l
cy
n
.
ge
es
er
a n d em
h er se rv ic
ti on a n d ot
tr a n sp or ta

128

planned contract increases for the Central
Arizona Shelter Services and the Local
Alcohol Reception Center by 3 percent.
The budget reductions also include closing
the Sky Harbor Family Services Center.
Case management staff at the Sky Harbor
Center will be reassigned to the
remaining centers.
Supplemental positions included in the
budget for new capital facilities include a
senior program supervisor, community
worker, three secretaries, two mini bus
operators, two caseworkers, and two food
service workers for the Westside, Shadow
Mountain and Devonshire Senior Centers.
These relocated and expanded centers,
which were funded in the 2001 Bond
Program, will be able to provide the
same array of services offered at other
senior centers.
The 2005-06 budget also includes
funding to convert one temporary
Reserve-a-Ride driver to a regular position.

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$70,212,000 $73,042,000 $71,661,000
559.4

566.4

571.0

Source of Funds:
General
Human Services
Grants

$21,333,000 $22,699,000 $24,953,000
46,629,000 47,397,000

Community Development
Block Grant
845,000

43,931,000

1,534,000

1,248,000

Federal Grants

547,000

548,000

617,000

City Improvement

207,000

227,000

266,000

Water

250,000

250,000

250,000

Transit 2000

156,000

156,000

156,000

Public Housing

151,000

148,000

159,000

Other Restricted

94,000

83,000

81,000

Human Services Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04

2004-05*

2005-06

Number of children in Head Start

3,194

3,194

3,194

Number of students receiving school-based
services

4,917

2,500

2,500

Community Services Division unduplicated
households served

16,953

15,000

16,000

161,000

180,000

170,000

509
186

509
70

509
70

Persons served at the winter overflow shelter

3,693

3,718

3,600

Senior clients receiving daily meals

2,345

2,484

2,484

613

607

607

1,662
880

2,602
885

2,300
1,200

Small Business

100

100

100

Summer Youth

1,050

1,050

1,050

40

32

32

890

889

889

Number of community volunteer hours
managed by Human Services staff
Average monthly downtown homeless
population:
Sheltered
Unsheltered

Daily average number of Reserve-a-Ride
passengers
Participants served in Employment
and Training programs:
Adult
Youth

Youthbuild
Number of employment placements
*Based on 10 months actual experience.

129

EDUCATION AND YOUTH
PROGRAMS

INTERNATIONAL AND
SISTER CITIES PROGRAMS

RIO SALADO

Program Goal

Program Goal

The Education and Youth Programs
function facilitates communication,
information and coordination between
city departments and schools to better
serve the youth of our community.

International and Sister Cities Programs
create exceptional people-to-people
opportunities for Phoenix residents,
businesses and organizations to experience
and understand other cultures through
international partnerships.

Program Goal

Budget Allowance Explanation
The Education and Youth Programs
operating budget allowance of $1,141,000
is $114,000 or 11.1 percent more than
2004-05 estimated expenditures. The
budget increase is due to inflationary
increases and additional funding to update
the Phoenix Education and Youth System
(PEYS) software.
The budget reductions in the budget
include reducing programming costs as
well as funding for special projects.

Expenditure and Position Summary
2003-04

2004-05

Budget Allowance Explanation
The International and Sister Cities
Programs operating budget allowance of
$551,000 is $8,000 or 1.5 percent more
than 2004-05 estimated expenditures.
This increase is the result of normal
inflationary increases offset by 2005-06
budget reductions, which decrease funding
for various operational expenses including
printing and office supplies. The budget
also converts a temporary administrator
and an assistant program administrator to
regular status.

2005-06

Expenditure and Position Summary
Operating Expense
Total Positions

$1,150,000 $1,027,000 $1,141,000
5.8

5.8

5.8

$703,000

$696,000

$868,000

447,000

331,000

273,000

Operating Expense

Source of Funds:
General
Other Restricted

Total Positions

2004-05

2005-06

$526,000

$543,000

$551,000

5.0

5.0

5.0

$526,000

$543,000

$551,000

Source of Funds:
General

130

2003-04

The Rio Salado Office coordinates the
Phoenix Rio Salado Habitat Restoration
Project and directs the city’s efforts in
restoring the native wetland and riparian
habitats along the banks of the Salt River.

Budget Allowance Explanation
The Rio Salado 2005-06 operating budget
allowance of $138,000 is $11,000 or 8.7
percent more than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$110,000

$127,000

$138,000

1.0

1.0

1.0

$110,000

$127,000

$138,000

Source of Funds:
General

EDUCATION AND YOUTH
PROGRAMS

INTERNATIONAL AND
SISTER CITIES PROGRAMS

RIO SALADO

Program Goal

Program Goal

The Education and Youth Programs
function facilitates communication,
information and coordination between
city departments and schools to better
serve the youth of our community.

International and Sister Cities Programs
create exceptional people-to-people
opportunities for Phoenix residents,
businesses and organizations to experience
and understand other cultures through
international partnerships.

Program Goal

Budget Allowance Explanation
The Education and Youth Programs
operating budget allowance of $1,141,000
is $114,000 or 11.1 percent more than
2004-05 estimated expenditures. The
budget increase is due to inflationary
increases and additional funding to update
the Phoenix Education and Youth System
(PEYS) software.
The budget reductions in the budget
include reducing programming costs as
well as funding for special projects.

Expenditure and Position Summary
2003-04

2004-05

Budget Allowance Explanation
The International and Sister Cities
Programs operating budget allowance of
$551,000 is $8,000 or 1.5 percent more
than 2004-05 estimated expenditures.
This increase is the result of normal
inflationary increases offset by 2005-06
budget reductions, which decrease funding
for various operational expenses including
printing and office supplies. The budget
also converts a temporary administrator
and an assistant program administrator to
regular status.

2005-06

Expenditure and Position Summary
Operating Expense
Total Positions

$1,150,000 $1,027,000 $1,141,000
5.8

5.8

5.8

$703,000

$696,000

$868,000

447,000

331,000

273,000

Operating Expense

Source of Funds:
General
Other Restricted

Total Positions

2004-05

2005-06

$526,000

$543,000

$551,000

5.0

5.0

5.0

$526,000

$543,000

$551,000

Source of Funds:
General

130

2003-04

The Rio Salado Office coordinates the
Phoenix Rio Salado Habitat Restoration
Project and directs the city’s efforts in
restoring the native wetland and riparian
habitats along the banks of the Salt River.

Budget Allowance Explanation
The Rio Salado 2005-06 operating budget
allowance of $138,000 is $11,000 or 8.7
percent more than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$110,000

$127,000

$138,000

1.0

1.0

1.0

$110,000

$127,000

$138,000

Source of Funds:
General

EDUCATION AND YOUTH
PROGRAMS

INTERNATIONAL AND
SISTER CITIES PROGRAMS

RIO SALADO

Program Goal

Program Goal

The Education and Youth Programs
function facilitates communication,
information and coordination between
city departments and schools to better
serve the youth of our community.

International and Sister Cities Programs
create exceptional people-to-people
opportunities for Phoenix residents,
businesses and organizations to experience
and understand other cultures through
international partnerships.

Program Goal

Budget Allowance Explanation
The Education and Youth Programs
operating budget allowance of $1,141,000
is $114,000 or 11.1 percent more than
2004-05 estimated expenditures. The
budget increase is due to inflationary
increases and additional funding to update
the Phoenix Education and Youth System
(PEYS) software.
The budget reductions in the budget
include reducing programming costs as
well as funding for special projects.

Expenditure and Position Summary
2003-04

2004-05

Budget Allowance Explanation
The International and Sister Cities
Programs operating budget allowance of
$551,000 is $8,000 or 1.5 percent more
than 2004-05 estimated expenditures.
This increase is the result of normal
inflationary increases offset by 2005-06
budget reductions, which decrease funding
for various operational expenses including
printing and office supplies. The budget
also converts a temporary administrator
and an assistant program administrator to
regular status.

2005-06

Expenditure and Position Summary
Operating Expense
Total Positions

$1,150,000 $1,027,000 $1,141,000
5.8

5.8

5.8

$703,000

$696,000

$868,000

447,000

331,000

273,000

Operating Expense

Source of Funds:
General
Other Restricted

Total Positions

2004-05

2005-06

$526,000

$543,000

$551,000

5.0

5.0

5.0

$526,000

$543,000

$551,000

Source of Funds:
General

130

2003-04

The Rio Salado Office coordinates the
Phoenix Rio Salado Habitat Restoration
Project and directs the city’s efforts in
restoring the native wetland and riparian
habitats along the banks of the Salt River.

Budget Allowance Explanation
The Rio Salado 2005-06 operating budget
allowance of $138,000 is $11,000 or 8.7
percent more than the 2004-05 estimated
expenditures. This increase reflects
normal inflationary adjustments.

Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$110,000

$127,000

$138,000

1.0

1.0

1.0

$110,000

$127,000

$138,000

Source of Funds:
General

HISTORIC PRESERVATION OFFICE

Historic Preservation Office Major Performance Measures and Service Levels

Program Goal

The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:

The Historic Preservation Office works
to support the protection, preservation
and designation of historic resources
throughout the city. The office also works
with other city departments to encourage
projects that are sensitive to historic
building and district character.

2003-04
Number of design reviews performed
on building permits in historic districts
Number of city grants awarded for
historic rehabilitation projects

2004-05*

2005-06

483

375

400

42

35

32

Budget Allowance Explanation

*Based on 10 months actual experience.

The Historic Preservation Office operating
budget allowance of $519,000 is $40,000 or
8.4 percent more than 2004-05 estimated
expenditures. The budget reflects full
staffing and normal inflationary increases.
These increases are partially offset by
budget reductions in administrative costs,
which will result in fewer educational
materials being published, fewer historic
district street sign installations, and longer
processing time for historic applications.

The decreased number of permits in 2004-05 is due to the elimination of historic design
reviews for routine maintenance-related permits beginning in October 2004. The HPO
anticipates the number of grant applications awarded will begin to decline in 2004-05 as
a decreasing amount of 2001 Historic Preservation Bonds is available for allocation to
new projects.

Expenditure and Position Summary

Operating Expense
Total Positions

2003-04

2004-05

2005-06

$436,000

$479,000

$519,000

6.0

6.0

6.0

$436,000

$479,000

$519,000

Source of Funds:
General

T h e re st or
a ti on of To
vr ea C a st le
in cl u d in g
be ga n in Ju
m a jo r st ru
ne
ct u ra l a n d
to th e en ti
a es th et ic im 20 05 ,
re st ru ct u
re .
p ro ve m en
ts

131

PHOENIX OFFICE OF ARTS
AND CULTURE

Program Goal
The Office of Arts and Culture supports
the development of the arts and cultural
community in Phoenix, and seeks to raise
the level of awareness and participation
of city residents in the preservation,
expansion and enjoyment of arts
and culture.

Budget Allowance Explanation
The Office of Arts and Culture operating
budget allowance of $2,243,000 is $43,000
or 2.0 percent more than 2004-05
estimated expenditures. Of the total
operating budget allowance, $721,000 is
dedicated to the matching grant program.
The remaining funding represents support
staff and operating expenses. The increase
reflects normal inflationary increases,
which are partly offset by General Fund
expenditure reductions.

The budget reduces grants to arts
organizations, provides for fewer
communications with the community,
and reduces funding for art preservation
projects. Individual grant awards or the
number of organizations receiving grants
will be reduced. Funding for framing of
artwork in the Municipal Art Collection,
community art educational projects and
communications highlighting new projects
and events also is reduced. Replacement
of interpretive plaques at the Cesar
Chavez Memorial Public Art Project
also is reduced.

er gr ee ts
gt on C a rv
rg e Wa sh in
eo
on C a rv er
G
gt
of
in
re
sh
u lp tu
G eo rg e Wa
e
th
of
A br on ze sc
oe n ix .
h
ce
P
n to w n
th e en tr a n
te r in d ow
en
vi si to rs a t
C
er ic a n
l
m
ra
-A
u
n
lt
a
ic
nd Cu
ee ri n g A fr
n
io
M u se u m a
p
h is
e
g
n
th
er w ea ri
p re se n ts
l re se a rc h
a p ed es ta l
T h e st a tu e
ra
u
lt
on
u
d
ic
te
n
gr
nd a
n d is m ou
a
,
n
ed u ca to r a
ro
p
a
a rv er.
su it a n d
ti on s by C
tr a d em a rk
fo u r qu ot a
h
it
w
d
be
in sc ri

132

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2004-05

2005-06

$1,806,000 $2,200,000 $2,243,000
12.5

12.5

12.5

Phoenix Office of Arts and Culture Major Performance Measures and
Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance.

Source of Funds:
General
Local Transportation
Assistance

106,000

106,000

106,000

Grant

507,000

939,000
_

940,000

Other Restricted

2003-04

2004-05*

Grant applications processed to support
arts activities through schools and
nonprofit organizations

128

141

142

Grant awards administered to support
arts activities through schools and
nonprofit organizations

115

112

116

Percent-for-art projects to enhance
city capital improvement projects
with artwork

56

58

64

Local artists/arts organizations
training workshops

23

16

13

Arts management consulting projects
coordinated by Business Volunteers
for the Arts

53

55

55

$1,174,000 $1,155,000 $1,194,000

19,000

3,000

2005-06

*Based on 10 months actual experience.
The number of grants applications processed and administered will vary with the number
of applicants and the size of the grants awarded. For 2004-05, the number of grants
applications administered decreased as arts organizations sought funding from other
sources as a result of a reduction in grants funding. The number of percent-for-art
projects administered varies with capital improvement project activity and the scope
of the individual projects undertaken. The reduction in training workshops is a result
of expenditure reductions.

133

y
fr om n ea rb
h st u d en ts
it
w
d
t
a
ke
d
or
m en t w
za , lo ca te
ic es D ep a rt
g Tr ee P la
a p in g
e L ea rn in
Wa te r Se rv
th
e
s in la n d sc
t
th
st
a
l
re
om
te
oo
h
fr
in
s
Sc
r
ee
ei
ry
y
th
lo
ta
p
er
en
Em
E le m
to fu rt h
H a m il to n
n go C u rv e,
A rt h u r M .
e I- 17 D u ra
th
d
n
a
e
u
19 th Ave n
t.
vi ro n m en
a n d th e en

134

Environmental Services

The Environmental Services Program
Represents 15.9% of the Total Budget.

The Environmental Services program
budget includes Water Services, Solid
Waste Management, Public Works and
Environmental Programs.

WATER SERVICES

Budget Allowance Explanation

Program Goal

The Water Services operating budget
allowance of $210,562,000 is $18,454,000
or 9.6 percent more than 2004-05
estimated expenditures. The increase
is primarily due to budget additions,
equipment replacement, operating
costs for new facilities and normal
inflationary increases.
The budget also includes the
carry-forward of funding for equipment,
facility remodeling and contractual
resources to develop options to address
drought conditions, publish the water
resources plan and provide labor
relations support.
The budget provides staff and other
resources to maintain consistent processes
at treatment plants and support recently
opened remote facilities ($523,000),

The Water Services Department is
responsible for the Water and Wastewater
Programs. The Water Program provides a
safe and adequate domestic water supply
to all residents in the Phoenix water
service area. The Wastewater Program
assists in providing a clean, healthy
environment through the effective
management of all water-borne wastes
generated within the Phoenix
drainage area.

Water _ Total Water Production
Billions of Gallons
140
135

130.3

130

126.8

124.3

125

121.4

119.7

120
115
110
105
100
2001-02

2002-03

2003-04

2004-05

2005-06

Fiscal Year

135

operate the department’s expanded
arsenic treatment program ($245,000),
and support expanded security services
at the department Control Center
($205,000). Also included is funding
for staff and supplies to provide enhanced
services to the development community
($280,000), support software applications
used to share information between field
crews and office staff and at public service
counters ($320,000), perform new
pollution prevention inspections on
commercial property and enhance
monitoring of fugitive agents at the Water
Lab ($147,000) and perform customer
service duties in growing areas of the city
($86,000).
Funding is included for staff and
supplies to operate and maintain the new
North Gateway Pump Station ($759,000)

and to support new facilities at the 91st
Avenue ($377,000) and the 23rd Avenue
($178,000) wastewater treatment plants,
including new chlorine equipment,
multi-phase digestion equipment and new
process control equipment. New staff and
supplies are also added to investigate,
mitigate and report sanitary sewer
overflows in response to new state
regulation ($216,000).
Additionally, staff is added to improve
management of the department’s capital
improvement program and provide better
coordination with the development
community. The cost of these positions
is charged to project budgets.
Funding also is added for contractual
services and commodities to operate and
maintain newly opened capital facilities
and equipment ($2,350,000).

Expenditure and Position Summary
2003-04
Operating Expense
Total Positions

2005-06

$180,231,000 $192,108,000 $210,562,000
1,317.1

1,355.1

1,409.1

Source of Funds:
Water
Wastewater
City Improvement
Other Restricted

Phoenix has adequate water supplies, but none to waste.
The city’s water conservation message asks residents to
continue to think about water every time they use it,
and make water conservation a part of their daily lifestyle,
especially outdoors.

136

2004-05

$115,883,000 $124,746,000 $135,468,000
64,192,000

67,267,000

156,000

_

74,991,000
_

_

95,000

103,000

Water Services Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:
2003-04
Gallons of water produced systemwide
(in billions)

2004-05*

2005-06

124.3

119.7

126.8

Gallons of wastewater treated (in billions)

69.4

69.2

70.7

Gallons of water supplied to consumers per $.01

4.80

4.54

4.27

Miles of wastewater collection lines cleaned

1,350

1,450

1,488

Laboratory analyses and analytic screenings
conducted in-house

96,074

80,04

82,000

Telephone calls:
Received
Percent answered

915,123
93%

986,813
94%

1,085,604
97%

Customer payments processed by customer
services staff (excludes mailed payments)

957,096

973,845

988,453

6,029

5,525

5,525

Percent of water leaks repaired within
the 5-day standard

98%

98%

98%

Average gallons of water used per capita
per day

222

219

218

Emergency repairs to water distribution system

*Based on 10 months actual experience.
Gallons of water supplied per $.01 decreased as a result of water rate increases needed to
support debt service for new treatment facilities and replacement of existing lines.
Laboratory analysis and screenings are decreased in 2004-05 as a result of fewer voluntary
(not compliance-related) tests being requested by internal divisions. Customers payments
processed are anticipated to increase as a result of population growth, acceptance of credit
cards for payment and installation of utility transaction terminals at several pay stations.
The decrease in average per capita water consumption is the result of water conservation
education, drought-related advertising and a wetter than normal winter monsoon.
Although a smaller decrease is expected in 2005-06, the numbers remain well below
pre-drought levels.

137

SOLID WASTE MANAGEMENT

Program Goal
The Solid Waste Management Program
assists in providing a safe and aesthetically
acceptable environment through effective,
integrated management of the solid waste
stream, including collection, disposal,
source reduction and recycling activities.

Budget Allowance Explanation
The 2005-06 Solid Waste Management
operating budget allowance of $90,664,000
is $9,837,000 or 12.2 percent more than
2004-05 estimated expenditures. This
increase is primarily due to normal
inflationary increases, expanded alley
cleanup as recommended in the Westside
Revitalization Study, and several budget
additions. The budget also reflects savings
from the managed competition process.

The city will resume providing residential
refuse services in two areas that were
previously serviced by contractors. Three
positions were eliminated due to efficiency
gains and equipment and operating costs
were also reduced.
Budget additions include 20 positions
to operate the North Gateway Transfer
Station that will open in January 2006,
upon the closure of Skunk Creek Landfill;
two solid waste foreman to supervise staff
at the Salt River Service Center and one
solid waste administrator to manage the
intergovernmental agreement between the
city of Phoenix and the town of Buckeye
related to the new landfill.

Expenditure and Position Summary
2003-04
Operating Expense

2005-06

$69,251,000 $80,827,000 $90,664,000

Total Positions

424.0

498.0

521.0

Source of Funds:
Solid Waste

$68,476,000 $80,153,000 $89,961,000

General
Grants

B u lk
ea ch y ea r.
rb a ge
fo u r ti m es
s
ga
ce
l
a
en
ti
d
si
en
d
-s er vi ce d re
d in a re si
ty
ce
ci
la
p
om
be
fr
d
a t ca n n ot
is co ll ec te
er.
a te ri a ls th
B u lk tr a sh
es co n ta in
a in ly of m
m
n ix R ec y cl
s
st
oe
h
si
P
n
e
u
bl
a
tr a sh co
in
or re cy cl ed
co n ta in er

138

2004-05

769,000
6,000

674,000
_

703,000
_

Solid Waste — Recyclable Material Processed
Thousands of Tons
120

117.0

118.0

120.0

122.0

114.0

2001-02

2002-03

2003-04

2004-05

2005-06

100
80
60
40
20
0
Fiscal Year

_______________________________________________________________________
Solid Waste Management Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with the
2005-06 budget allowance:
2003-04

2004-05*

2005-06

Residential households served with twice
per week contained solid waste and
recyclable material collections

346,854

354,000

361,000

Tons of residential recyclable materials
collected

118,300

120,000

121,500

Tons of total solid waste disposed at
city landfills**

915,000

945,000

1,021,000

Tons of solid waste from city residences
disposed**

610,000

600,000

675,600

*Based on 10 months actual experience.
**FY 2003-04 and 2004-05 tonnages were lower due to reciprocal agreements with private
landfill operators that will end in FY 2005-06.

139

PUBLIC WORKS

Program Goal
The Public Works Department provides
mechanical and electrical maintenance
and energy conservation services for
city facilities, and procures, manages
and maintains the city’s fleet of
vehicular equipment.

Budget Allowance Explanation
The 2005-06 Public Works operating
budget allowance of $25,689,000 is
$321,000 or 1.3 percent more than 2004-05
estimated expenditures. The increase is
due to normal inflationary adjustments,

budget additions, and funding for the
maintenance of buildings on the ASU
Downtown Campus. These costs are
reimbursed by Arizona State University.
The increase is partially offset by budget
reductions which include the elimination
of one electrical apprentice position,
reducing the 5 percent increase in the
animal control services contract to
2.4 percent and eliminating funding for
facility maintenance, refurbishing and
remodeling in various city, as well as,
cultural facilities.

2003-04

Fleet vehicles per mechanic
Units of equipment for which fleet
management is provided
Annual miles of fleet vehicle utilization
(in millions)
*Based on 10 months actual experience.

140

2003-04
Operating Expense
Total Positions

2004-05*

2005-06

6,107,890

7,342,987

7,448,987

17,513

18,609

19,672

39.7

39.5

37.0

6,402

6,441

6,520

49.7

50.0

50.0

2004-05

2005-06

$22,671,000 $25,368,000 $25,689,000
497.0

501.0

501.0

Source of Funds:
General

Other Restricted

The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:

Facility service requests completed

Expenditure and Position Summary

City Improvement

Public Works Major Performance Measures and Service Levels

Square feet of building space maintained

Supplemental funds in the 2005-06
operating budget reflect funding for utility
costs, landscape and exterior maintenance
associated with the expansion of the
Phoenix Arts Museum.

$17,724,000 $19,049,000 $18,764,000
4,947,000
_

5,326,000

5,372,000

993,000

1,553,000

ENVIRONMENTAL PROGRAMS

Environmental Programs
Number of Days Exceeding Air Quality Standards

Program Goal
The Office of Environmental Programs
provides coordination and monitoring for
the city’s environmental programs and
activities, and develops and implements
regulatory policies and programs.

Days
12

9

8
6

Budget Allowance Explanation

6

The Office of Environmental Programs
2005-06 operating budget allowance of
$1,978,000 is $414,000 or 26.5 percent
more than the 2004-05 estimated
expenditures. The increase is the result
of inflationary adjustments and carryover
funding for dust control and brownfield
projects offset by budget reductions.
The 2005-06 budget reductions include
reduced funding for technical assistance
for drywell compliance, brownfield
projects, and employee training on federal
and state environmental regulations.

3

0

2000

2001

Operating Expense
Total Positions

2004-05

2005-06

$1,433,000 $1,564,000 $1,978,000
15.0

15.0

15.0

Source of Funds:
General
Water

$1,154,000 $1,221,000 $1,336,000

2

2002

2003

3

2004

Fiscal Year

Environmental Programs Major Performance Measures and Service Levels
The following significant performance measures and service trends will be achieved with
the 2005-06 budget allowance:

Expenditure and Position Summary
2003-04

2

2003-04

2004-05*

2005-06

1,502

705

700

Number of facility assessments
and technical assistance visits conducted

69

80

50

Number of brownfield projects implemented

18

19

21

Employees receiving training on
environmental issues

194,000

198,000

207,000

Capital Construction

61,000

Other Restricted

24,000
_

30,000
_

150,000
_

Overall customer satisfaction
with technical and regulatory assistance

97%

97%

97%

115,000

285,000

Number of environmentally preferred
product tests and process changes
conducted/implemented to reduce
hazardous materials or hazardous waste

88

34

25

Grants

*Based on 10 months actual experience.

141

Contingencies

The Contingency Fund (also commonly
referred to as a “rainy day fund”) provides
for revenue shortfalls and unanticipated
costs that may occur after the budget
is adopted. The possibility of natural
disasters, public or employee safety
emergencies or up-front costs for
productivity opportunities necessitates
the need for adequate contingency funds.
Use of these contingency funds requires
the recommendation of the city manager
and City Council approval.

GENERAL FUND CONTINGENCY
The budget reflects an increase in the
General Fund contingency from the
2004-05 budgeted level of $23,800,000
to $24,740,000. The increase maintains
a General Fund contingency equal to
2.6 percent of operating expenditures.

In 1995-96, the City Council adopted
a policy to slowly increase the contingency
amount to 3 percent of operating
expenditures. The following table shows
the progression from the 2.5 percent
level in 1995-96 to 3 percent in 2000-01.
In 2003-04, a budget reduction returned
the base to 2.5 percent. In 2004-05 the
contingency budget was increased to
2.6 percent of operating expenditures.

The 2005-06 budget increases the
contingency amount by $940,000
maintaining the 2.6 percent level.
The following table also shows
set-aside amounts. Set-asides have been
used in the past to prepare for known
future costs such as declining grant
funding and new capital project operating
costs. No set-asides are proposed
for 2005-06.

Comparison of Annual Budget for General Fund Contingency Amount
to Operating Expenditures (000’s)

Fiscal
Year

General Fund
Operating
Expenditures*

Contingency
and Set-Aside
Amounts

Percent of
Operating
Expenditures

1995-96

$633,964

$15,625
3,000

2.5%

1996-97

674,619

17,318
1,320

2.6%

1997-98

711,266

19,000
_

2.7%

1998-99

748,937

21,000
1,150

2.8

1999-00

797,633

23,408
1,800

2.9

2000-01

883,196

26,780
4,600

3.0

2001-02

887,644

26,550
7,600

3.0

2002-03

912,192

27,190
3,652

3.0

2003-04

912,583

22,700
_

2.5

2004-05

925,603

23,800

2.6

2005-06

965,936

24,740

2.6

*Prior to 2001-02, Development Services operating expenditures were included in the
General Fund contingency calculation. A separate contingency has been established
in that fund.

143

OTHER FUND CONTINGENCIES
Similar to the General Fund, other
funds also include contingency amounts.
The contingency amounts and percentages
of total operating expenditures vary to
accommodate differences in the volatility
of operations and revenues. Use of these
amounts requires City Council approval.
The following table shows the contingency
amount for each of the other funds.

2005-06 Other Fund Operating Expenditure and Contingency Amount (000’s)
Operating
Expenditures

Contingency
Amount

$100,767

$ 9,000

50,735

2,500

4.9

Aviation

192,313

10,000

5.2

Water

167,275

30,000

17.9

Wastewater

90,567

14,821

16.4

Solid Waste

95,946

6,000

6.3

Civic Plaza

32,738

2,800

8.6

6,121

50

0.8

16,156

484

Fund
Transit 2000
Development Services

Golf
Public Safety
Enhancement

144

Percent of Operating
Expenditures
8.9%

3.0%

Debt Service and Lease Purchase

Debt service expenditures include
payments of principal, interest, sinking
fund contributions and bond reserve
requirements for bonds issued. The debt
service allowance in 2005-06 for existing
debt and future bond sales is $567,385,000
and the lease purchase payments are
$69,150,000 for a combined total of
$636,535,000. As shown in the following
chart, the $567.4 million in bonded debt
service payments is funded by Secondary
Property Tax and G.O. Bond Redemption,
Water, Aviation, Wastewater, City
Improvement, Arizona Highway User
Revenue, Civic Plaza, and Solid Waste
funds. Other funding sources include
Sports Facilities, Golf and Grant funds.
City Improvement includes $69.2 million
in lease purchase debt service payments
funded by the General, Transit 2000
and Sports Facilities funds.
Secondary Property Tax shown in the
pie chart above includes $110.5 million
from the annual tax levy for debt service
and related interest earnings, plus another
$150 million from G.O. Bond Early
Redemption funds. The 2001 Bond
Committee recommended this early
retirement of outstanding general
obligation debt. Another $30 million
in early retirement is planned for
the 2006-07 fiscal year.

Types of Bonds Issued and Security
Under Arizona law, cities are authorized
to issue voter-approved general obligation,
highway user revenue and utility revenue
bonds. For the city of Phoenix, this
includes property tax-supported bonds
and revenue bonds (such as water revenue
and airport revenue bonds).
The city’s general obligation bonds are
“full faith and credit” bonds. This means
they are secured by a legally binding
pledge to levy property taxes without

2005-06 Debt Service
Others 1.6%
Solid Waste 2.7%
Wastewater 8.2%

Secondary Property
Tax 40.9%

Aviation 12.5%

Civic Plaza 4.3%
Water 13.6%
AHUR City Improvement*
10.9%
5.3%
*Funded by the General, Transit 2000
and Sports Facilities taxes.

limit to make annual bond principal and
interest payments. Water and airport
revenue bonds are secured by a pledge of
these enterprises’ net revenues (revenues
net of operation and maintenance
expenses) and do not constitute a general
obligation of the city backed by general
taxing power. Highway user revenue bonds
are secured by state-shared gas taxes and
other highway user fees and charges and
also are not general obligations of the city.

Debt Management
In general, the city has used general
obligation bonds to finance capital
programs of general government
(non-enterprise) departments. These
include programs such as fire protection,
police protection, libraries, parks and
recreation, mountain preserves and storm
sewers. The debt service on these bonds
is paid from the secondary property tax
levy. By state law, the city can only use
its secondary property tax levy to pay
principal and interest on long-term debt.
To finance the capital programs of
enterprise departments, the city has made
substantial use of revenue bonds secured
by and repaid from the revenues of these

enterprises. In the past, the city also has
used general obligation bonds for water,
airport, sanitary sewer and solid waste
purposes when deemed appropriate.
However, these bonds are repaid from the
revenues of these enterprises, not from
property taxes or other general revenues.
The city’s policy of servicing bonds
issued for enterprise purposes with
enterprise revenues (for both revenue
and general obligation bonds) is viewed
favorably by municipal bond analysts.
This practice permits the city to maintain
a low-to-moderate debt burden on the
property tax base. This debt burden is
a key measure evaluated by analysts to
assess the city’s financial strength.
Since the 1950s, the city has used
a community review process to develop
and acquire voter approval for general
obligation bond programs. To prepare
for the special bond election held on
March 13, 2001, the Mayor and the City
Council appointed the 2001 Citizens’
Bond Committee composed of nearly
300 members to review the city’s fiscal
capacity, capital facility needs and
operating and maintenance costs of
needed facilities. This committee
recommended a $753.9 million bond
145

program to the voters which assumed
a continuation of the city’s current
property tax rate of $1.82 per $100 of
assessed valuation.
As a result of the efforts of this
committee, the voters approved all
$753.9 million of recommended bond
authorizations in the March 13, 2001
special election. These authorizations
provided funding to construct capital
improvements in the following areas:
■

■

■

Police Protection Facilities and
Equipment
Police, Fire and Computer Technology
Environmental Improvements
and Cleanup

■

■

■

■

■

■

■

Preserving Phoenix Heritage

Bond Ratings

Parks, Open Space
and Recreational Facilities

The city’s bonds are rated favorably by the
major bond rating agencies, Moody’s
Investors Service and Standard and Poor’s.
The city’s general obligation bonds are
rated Aa1 and AA+ respectively. These
ratings are half of a rating category below
each agency’s highest rating.
Maintaining high bond ratings has
resulted in a broader market for the city’s
bonds and lower interest costs to the city.
The following table is a statement
of the city’s bonded indebtedness as of
April 1, 2005.

Educational, Youth and Cultural
Facilities
Library Facilities
Fire Protection Facilities and
Equipment
Neighborhood Protection and
Senior Centers
Affordable Housing and Homeless
Shelter

■

Storm Sewers

■

Street Improvements

Statement of Bonded Indebtedness
General Obligation Bonds (In Thousands of Dollars) (1)

Purpose

Non-Enterprise
Revenue
General
Supported General
Obligation
Obligation
Bonds
Bonds

Various
Airport
Sanitary Sewer
Solid Waste
Water
Public Housing
Street and Highway

$842,594
_
_
_
_
_
_

$

Subtotal
Less: Restricted Funds

_

Total
General
Obligation
Bonds

Revenue
Bonds
_

Total
Bonds

$

27,605
73,731
44,595
130,969
_
_

$ 842,594
27,605
73,731
44,595
130,969
_
_

2,145
188,511

$ 842,594
68,845
73,731
44,595
130,969
2,145
188,511

$842,594
(286,036))

$276,900
_

$1,119,494
(286,036)

$231,896
_

$1,351,390
(286,036)

Direct Debt
Less: Revenue Supported

$556,558
_

$276,900
(276,900)

$231,896
(231,896)

$1,065,354
(508,796)

Net Debt

$556,558

$

_

$833,458
(276,900)
$ 556,558

41,240
_
_
_

$

_

$ 556,558

(1) These figures do not include the outstanding principal amounts of certain general obligation bonds, water revenue bonds, and
street and highway user revenue bonds that have been refunded or the payment of which has been provided in advance of maturity.
The payment of the debt service requirements on such bonds (including redemption premiums where applicable) is secured by federal
securities that were purchased with proceeds of the refunding issues and other available monies that are held in irrevocable trusts and
special investment funds held by the city.

146

Debt Limitation
Under the provisions of the Arizona
Constitution, outstanding general
obligation bonded debt for combined
water, sewer, lighting, park, open space
and recreational purposes may not exceed
20 percent of a city’s net secondary
assessed valuation. Outstanding general
obligation bonded debt for all other
purposes may not exceed 6 percent of a
city’s net secondary assessed valuation.
Unused borrowing capacity as of
April 1, 2005 based upon 2004-05
assessed valuation is shown in the
following tables.

Debt Burden
Debt burden is a measurement of the
relationship between the debt of the
city supported by its property tax base
(net direct debt) to the broadest and most
generally available measure of wealth in
the community: the assessed valuation
of all taxable property and the assessed
valuation adjusted to reflect market value.
In addition, net debt can be compared
to population to determine net debt per
capita. The city makes these comparisons
each time it offers bonds for sale. They
are included in the official statements
(bond prospectuses) that are distributed
to prospective investors. The following
table provides debt burden ratios as
of April 1, 2005.
The city’s debt burden remains in the
low-to-moderate range. This means the
amount of net debt supported by the
city’s property tax base is moderate
relative to the value of that tax base.
The city has considerable bonded debt
outstanding. However, the use of revenue
bonds for enterprise activities and
enterprise-supported general obligation
bonds, in combination with a wellmanaged, property tax-supported bond
program, has permitted the maintenance
of a low-to-moderate debt burden.

Water, Sewer, Lighting, Parks, Open Space and Recreational Purpose Bonds
20% Constitutional Limitation
Direct General Obligation Bonds Outstanding

$2,097,984,329
(743,253,138)

Unused 20% Limitation Borrowing Capacity

$1,354,731,191

All Other General Obligation Bonds
6% Constitutional Limitation
Direct General Obligation Bonds Outstanding
Less: Principal Redemption Funds held
in Restricted Fund as of April 1, 2005

$629,395,299
$376,240,000
(286,036,070)

Direct General Obligation Bonds Outstanding

(90,203,930)

Unused 6% Limitation Borrowing Capacity

$539,191,369

Net Direct General Obligation Bonded Debt Ratios
Per Capita Debt Secondary
Pop. Est. as of
Assessed
April 1, 2005
Valuation
(1,513,740) ($10,489,921,645)

Full
Cash Valuation
($83,439,807,440)

Direct General Obligation
Bonded Debt Outstanding
as of April 1, 2005

$550.59

8.51%

1.05%

Net Direct General Obligation
Bonded Debt Outstanding
as of April 1, 2005

%367.67

5.68%

0.70%

147

Lease Purchase
In addition to bonded debt, the city uses
nonprofit corporation bonds as a financing
tool. This form of financing involves
the issuance of bonds by a nonprofit
corporation for city-approved projects.
The city makes annual payments equal
to the bond debt service requirements to
the corporation under a lease-purchase
or purchase agreement.
The city’s payments to the corporation
are guaranteed by a pledge of excise taxes
or utility revenues generated by the
city’s airport, water system or wastewater
system. Pledged excise taxes may include
city sales, use, utility and franchise taxes;
license and permit fees; and state-shared
sales and income taxes.

The city has used nonprofit corporation
financing selectively. In general, it has
financed only those projects that will
generate revenues adequate to support the
annual debt service requirements or that
generate economic benefits that more than
offset the cost of financing. Similar to
bonded debt, these financings are rated
by bond rating agencies. The most recent
ratings for excise tax revenue bonds by
Standard and Poor’s and Moody’s Investors
Service were AAA and Aa2 respectively.

Debt Service and Lease Purchase Expenditures by Source of Funds
(In Thousands of Dollars)
Fund
Secondary Property Tax and G.O.
Bond Redemption

2003-04
Actual

2004-05
Estimate

2005-06
Budget

$ 96,586

$102,356

$260,461

Aviation Operating and Capital*

55,806

76,467

79,835

Arizona Highway User Revenue

31,131

29,206

34,047

Capital Projects Funds

1,077

_

_

Civic Plaza

9,633

9,638

27,635

17,407

20,110

23,799

196

416

579

General*
Golf
Grant Funds

2,542

2,142

2,139

Solid Waste

16,507

17,224

17,219

Sports Facilities*

8,735

9,135

24,519

818

15,138

27,678

Wastewater

45,664

48,066

51,985

Water*

62,940

70,218

86,639

$349,042

$400,116

$636,535

Transit 2000*

Total

* Includes bonded debt and lease purchase payments

148

Overview of Capital Improvement Program Process

The Capital Improvement Program is a
multiyear plan for capital expenditures
needed to replace, expand and improve
infrastructure and systems. It is a citywide
presentation and summary of the results
of several other planning processes that
identify and provide funding for capital
projects. On April 5, 2005, the City Council
reviewed the Preliminary 2005-10 Capital
Improvement Program and forwarded the
2001 bond-funded portion to the 2001
Bond Committee for their review and
consideration. The Capital Improvement
Program reflected here includes the
preliminary plan presented to the City
Council as adjusted for General Fund
budget reductions. The preliminary
program was then adjusted for projects
that carried-over from 2004-05 to 2005-06
and for other miscellaneous program
modifications before it was submitted to
the City Council for adoption in June.

programs for funding availability,
reasonableness and technical accuracy.
In addition to the planning processes
outlined in the following sections, this
program also reflects the proposed
five-year Arterial Streets Plan and
adopted multi-year rate forecasts for the
enterprise funds.
In conjunction with the CIP process,
the Engineering and Architectural
Services Department works with
departments to level design and
construction bid award dates evenly
throughout the fiscal year. By avoiding
bidding capital projects during the last
quarter of the fiscal year, the city has
reduced construction costs and increased
project quality by making better use of
construction resources. The city has also
achieved lower bid prices and increased
competition for city projects by avoiding
busy periods for the construction industry.

2005-10 Capital Improvement
Program Development

2001 Citizens’ Bond
Committee Program

The annual Capital Improvement Program
update process began in January when
departments submitted their revised
2004-05 estimates and their updated
five-year capital improvement programs.
The 2004-05 estimates reflect updated
construction estimates, project timing
changes, awarded contract amounts,
project carry-overs and any other program
changes. The updated five-year program
includes projects planned for authorized
bond funding and the latest estimates
for pay-as-you-go projects funded with
operating funds, federal funds, impact fees
and other sources. Budget and Research
staff reviewed the departments’ revised

Voter-approved bond authorizations are
a major funding source for the general
government portion of the Capital
Improvement Program. In August 2000, a
Citizens’ Bond Committee was appointed
by the City Council to develop a
recommended program to take to the
voters. Nearly 300 citizen members served
on various bond subcommittees. The
residents reviewed the city’s capacity to
service new property tax-supported debt
in addition to unmet capital facility needs
identified by city departments and the
ongoing costs of operating these facilities.
Through the work of 10 service-related
bond subcommittees, the Citizens’ Bond
Committee recommended a detailed
capital program to the City Council. This
$753.9 million recommended program
assumed a relatively level schedule of bond
fund programming that would not require
an increase in the city’s combined property

tax rate of $1.82 per $100 of assessed
valuation. The voters approved the entire
$753.9 million recommended program.
Improvements in the following areas are
reflected in the 2005-10 Capital
Improvement Program.
■

■

■

■

■

■

■

■

■

Police Protection Facilities
and Equipment
Police, Fire and City Computer
Technology
Environmental Improvements
and Clean-up
Parks, Open Space
and Recreational Facilities
Educational, Youth and Cultural
Facilities
Library Facilities
Fire Protection Facilities and
Equipment
Neighborhood Protection and
Senior Centers
Affordable Housing and Homeless
Shelter

■

Storm Sewers

■

Street Improvements

It has been the city’s practice to
require ongoing citizen oversight of
property tax-funded bond programs.
The 2001 Citizens’ Bond Committee has
recommended this practice be continued
and that this oversight include an annual
review of the Capital Improvement
Program, an annual review and update of
actual assessed valuation results compared
to forecast and an annual review of any
changes to the program. Finally, the
Citizens’ Bond Committee expressed
an interest in looking for efficiencies as
the bond program progresses by using
concepts such as value engineering.

149

The committee met on April 14, 2005,
to review and recommend approval of the
2001 Bond-funded portion of the 2005-10
Capital Improvement Program. Their
review and recommendations mostly
involved reallocating project savings to
those projects experiencing higher costs
primarily due to steel and concrete prices.
Savings generally result from using funding
sources other than bonds where available
and through efforts such as value
engineering and developing joint facilities.
The following are the major changes
approved by the committee:
■

■

■

■

■

Reprogram remaining savings from
cancellation of Fire Station 45 to pay
for cost increases in several other
fire station projects
Reduce the scope of the North Family
Service Center to land acquisition
and design only and reallocate planned
construction funding to other Human
Services facilities with cost increases
and explore the possibility of allocating
some savings to homeless facilities
Reprogram savings due to two planned
freeway interchanges now being funded
through extension of the countywide
half-cent transportation sales tax
to other street projects with
increased costs
Reallocate savings from using unspent
1988 storm sewer bonds to add
new projects
Reprogram savings in several programs
due to the availability of impact fees to
pay for portions of planned projects

Parks and Preserves Funds
In September 1999, the voters approved
a one-tenth of 1 percent sales tax to
purchase state trust lands for the Sonoran
Desert Preserve and for the development
and improvement of regional and
neighborhood parks. The 2005-10 Capital
Improvement Program includes $174.1
million of these funds, which are

150

programmed for nine regional parks,
community and neighborhood parks
and Sonoran Preserve land acquisition.
Land acquisitions are programmed to
take advantage of state grant funding
opportunities. The 2009-10 plan reflects
the final partial year of funding from
this 10-year sales tax.

Transit 2000 Funds
The voters approved Proposition 2000 on
March 14, 2000. This initiative authorized
a four-tenths of 1 percent sales tax to
implement the Transit 2000 plan. The
2005-10 Capital Improvement Program
includes $528.1 million of these funds,
which are programmed for:
■

■

■

■

■

■

Additional buses for expanded regular,
express, and Dial-a-Ride service
($15.9 million)
New and expanded passenger and
maintenance facilities ($53.0 million)
Bus pullouts, left-turn arrows
and bicycle lanes ($13.7 million)
Technology upgrades ($7.4)
Rail, bus rapid transit and other
facilities ($415.6 million)
Contingencies for unanticipated needs
or cost increases ($22.5 million).

Capital Construction Funds
The Capital Construction fund was
established in 1998-99 and now provides
about $21 million each year for critical
infrastructure improvements in the
right-of-way. Community input from
a series of public meetings supported
using these funds for neighborhood street
rehabilitation, sidewalks and wheelchair
ramps, traffic safety and traffic calming
projects and neighborhood traffic
mitigation projects.
The 2005-10 Capital Improvement
Program includes $116.6 million in Capital
Construction-funded projects. Most of
the funds are programmed as lump sum

amounts in the project categories defined
in the community process. Individual
projects are determined based on traffic
engineering data and neighborhood input.
These funds are also programmed to pay
for net increased cost of installing a new
69-kilovolt electric line underground
rather than above ground. The planned
path of these lines crosses the northern
portions of the city including the Sonoran
Desert preserve.

Programming of
Development Impact Fees
In 1987, the City Council adopted an
ordinance requiring new development
in the city’s peripheral planning areas
to pay its proportionate share of the
costs associated with providing public
infrastructure. The program and fees
are based on long-range planning for
forecasted growth and related
facility needs.
Development impact fee collections
initially progressed slowly because of a
slowdown in construction in the late 1980s
and early 1990s. However, over time
development impact fee collections have
become more significant. The 2005-10
Capital Improvement Program includes
$111.6 million in development impact
fee-funded projects.
Development impact fees collected for
a specific peripheral planning area must
be expended for capital infrastructure in
that area and are not available for any
other use. In addition, development
impact fee-funded projects must directly
benefit the parties that paid the fees.
Budget and Research staff have worked
with Planning and operating department
staff to program development impact
fee funds appropriately in the 2005-10
Capital Improvement Program.
Additional development impact fees
will be programmed in future capital
improvement programs as these
fees are collected.

2005-10 Capital Improvement Program Highlights

The Capital Improvement Program (CIP)
totals $5.4 billion over the next five years.
As shown in the pie chart, funding for the
2005-10 program comes from five main
sources: $291.3 million in 1981, 1988, 1989
and 2001 voter-approved bond funds,
$964.3 million in pay-as-you-go operating
funds, $1.9 billion in various enterprise
bonds, $702.1 million in Transit 2000 and
Parks and Preserve Initiative funds, and
$1.6 billion in other funds. The $1.6 billion
in other funds includes $669.0 million in
lease-purchase funds, $334.2 million in
capital grants, $295.9 million payments by
other cities and agencies for participating
in projects in programs such as Water and
Wastewater, $39.2 million in grants, $111.6
in development impact fees, $117.1 million
in passenger facility charges, $7.4 in
Solid Waste remediation funding
and $5.1 million from miscellaneous
capital sources.
Projects included in the first year
total $2.3 billion and are funded from
pay-as-you-go operating funds ($384.2
million), bond funds ($1.1 billion) and
other capital financing ($801.1 million).
Two schedules at the end of this section
summarize the 2005-06 Capital Budget.
The first summarizes each program
by source of funds and the second
summarizes the resources, expenditures
and fund balances by capital fund.
A brief overview of the five-year plan
for each program follows.

2005-10 Capital Improvement Program
Sources of Funds
Bond Programs
$291 Million
Enterprise Bonds
$1.9 Billion

Pay-As-You-Go
$964 Million

Transit 2000 and
Parks and Preserves
$702 Million
Other
$1.6 Billion

Arts and Cultural Facilities

Aviation

The $8.4 million Arts and Cultural
Facilities program is funded with 2001
bonds and includes the following projects:

The Aviation program totals $579.9 million.
This program includes improvements at
Sky Harbor International Airport and the
two satellite airports, Goodyear and Deer
Valley. The Aviation program is funded
with Aviation operating revenue,
federal grant funds, Aviation nonprofit
corporation bonds and Passenger
Facility Charge funds.
Major improvements planned for
Sky Harbor International Airport include
the following:

■

■

■

Complete an expansion of the
Phoenix Museum of History
Construct an expansion of the
Museo Chicano
Complete land acquisition and
renovation of the Phoenix Family
Museum

■

■

■

■

■

■

Reconstruct existing asphalt taxiways
in concrete
Clean up fueling sites at Sky Harbor
International Airport
Complete a terminal blast analysis
Complete other required security
improvements at Sky Harbor
International Airport
Soundproof homes near Sky Harbor
International Airport and other noise
mitigation projects
Remodel former rental car areas at
Terminal 3 and Terminal 4

151

■

■

■

■

■

■

Construct automated pay stations
in parking structures
Remodel air cargo buildings
Design an airport people mover system,
including a light rail train station
Acquire land for future airport
expansion
Remodel security checkpoints at
Terminals 2, 3 and 4
Rehabilitate Terminal 4 sidewalk
expansion joints

Civic Plaza
The $424.2 million Civic Plaza program is
funded with Civic Plaza operating revenue,
Civic Plaza nonprofit corporation bonds,
2001 bonds, General funds and leasepurchase funds. In addition to the
Convention Center, this program includes
the Herberger and Orpheum Theaters,
Symphony Hall plus the Patriot’s,
Hyatt Regency, Heritage, Jefferson Street
and Civic Plaza parking garages.

The multi-year Convention Center
expansion is the primary project in
this program. Other convention center
projects include only internal repairs.
Miscellaneous improvements and
studies are also planned for the garages
and theaters.
2001 bonds are planned to complete
a refurbishment of Symphony Hall,
including infrastructure, public
and backstage areas, operating systems
and roofing.

The Aviation program also includes
reconstructing the south ramp at
Deer Valley Airport and constructing
security fencing at Deer Valley and
Goodyear Airports.

e n ew
h om e to th
ce w il l be
a
ng and
rr
ti
Te
ee
y
m
on
u a re fe et of
th e Sy m p h
sq
s
a
0
n
00
0,
ow
l of fe r 16
rm er ly kn
w h ic h w il
T h e a re a fo
t B u il d in g,
es
06 .
W
20
za
in
la
C iv ic P
it op en s
sp a ce w h en
n
io
it
ib
h
ex

152

Downtown Development

Energy Conservation

Facilities Management

The $299.8 million Downtown
Development program is funded with
nonprofit corporation bonds, Community
Reinvestment funds, Sports Facilities
funds, lease-purchase funds and 2001
bond funds.
Acquisition of land, design and
construction of a 1,000-room hotel and the
first phase of an ASU campus in downtown
Phoenix are the major projects in this
program. Completion of the Phoenix
Union and Fillmore properties acquisitions
and the TGEN/IGC projects also are
included. Community Reinvestment
funding also is programmed for downtown
redevelopment purposes.

The $7.8 million Energy Conservation
program is funded with General, Civic
Plaza, Wastewater and Water operating
funds. This program includes projects
to continue the city’s energy conservation
and cost reduction efforts at various
city facilities.
The city’s Energy Conservation program
has been in place for more than 20 years.
Through the program’s efforts in
addressing energy efficient retrofits,
energy efficient design and management,
metering for efficient operations and
implementation of new technology, the
annual cost savings average $250,000.

The Facilities Management program totals
$34.9 million and is funded with 2001
bonds, General funds, lease-purchase
funds and impact fees. The following
projects are planned for 2001 bond
funding:
■

■

■

■

Renovation of the Glenrosa
Service Center
Construction of accessibility
improvements at existing service
centers
Construction of the Pecos
Community Center
Conceptual design of customer
service centers

T h e st a te -o
f- th e- a rt T
G en bu il d
fo r th e 24 -a
in g is th e
cr e d ow n to
fi rs t of se ve
w n P h oe n
ra l bu il d in
ix B io m ed
gs be
ic a l C en te
r a t C op p er in g p la n n ed
Sq u a re .

153

Also provided from 2001 bonds is
funding for environmental clean-up at
various city project sites.
2001 bond funds for CNG fueling
stations are included but have been
deferred pending analysis of the ongoing
feasibility of the overall CNG program.
Projects planned for General funding
include remediation of contaminated soil
from leaking underground storage tanks;
construction of mechanical upgrades at
the Calvin C. Goode Building; constructing
improvements at the Adams Street Garage;
design and construction of facilities
improvements at the Union Hills, Salt
River, Central and Okemah service
centers; design and construction of a fuel
dispensing station at the Glenrosa Service
Center and the construction of equipment
repair canopies at the Glenrosa and
Okemah service centers. Development
impact fees partially fund construction
of the Pecos Community Center and the
North Gateway Fuel Site.

Fire Protection
The $32.6 million Fire Protection program
is funded with 2001 bonds and General
funds. The following fire stations are
planned for 2001 bond funding:
Fire Station Construction
■

The following firefighter training and
technology projects also are programmed
for 2001 bond funding:
■

■

New Station 57 at 15th Avenue
and Dobbins Road
■

■

Infill Station 60 at 19th
and Dunlap avenues
■

■

■

Infill Station 61 at 16th Street
and Indian School Road
Infill Station 62 at 48th Street
and Camelback Road

Fire Station Land Acquisition
■

■

■

Station 55 at I-17 and Jomax Road

Acquisition of firefighter safety
equipment
Expansion of the Fire Training
Academy and acquisition of firefighter
training technology
Installation of additional traffic
signal preemption
Land acquisition for a future
Fire Operations Center expansion

General funds are programmed to
acquire multi-agency computer-aided
dispatch equipment. Revenue from
participating entities will fund their
portion of the project.

Station 64 at 51st Avenue
and Osborn Road
Station 63 at Seventh Street
and Thunderbird Road

ll s,
13 7, 00 0 ca
m or e th a n
to
ed
d
on
en t re sp
se co n d s.
e D ep a rt m
h oe n ix F ir
P
m in u te s, 59
e
4
th
of
,
e
04
m
ti
In 20
se
on
sp
ve ra ge re
w it h a n a

154

Freeway Mitigation

Historic Preservation

The Freeway Mitigation program totals
$6.9 million. This program is funded with
1988 and 2001 bonds.
The Freeway Mitigation program
provides for the development of freeway
corridor improvements to buffer the
impact of existing and new limited-access
roadways on the city's neighborhoods.
Improvements are programmed in the
Piestewa Peak Parkway, Outer Loop, South
Mountain Loop, Papago/Red Mountain
Freeway and Black Canyon/Maricopa
Freeway corridors. Costs of advancing an
Arizona Department of Transportation
project to install rubberized asphalt on the
freeways within the city also are included.

The Historic Preservation program totals
$3.4 million and is funded with 1989
Historic Preservation and 2001 bonds.
The following projects are planned for
2001 bond funding:

project will establish a mixed-use,
mixed-income development and will
create incentives to attract additional
investment to the area through public/
private partnership.

Housing
■

■

■

Construction of historic preservation
demonstration projects
Construction of city-owned historic
preservation demonstration projects
Assistance to preserve the exteriors
of historic homes including a
low-income program

HOPE
The HOPE VI project is programmed for
$11.2 million and is funded with federal
grants and 2001 bonds. The HOPE VI
project will reconstruct the public housing
units at Matthew Henson and revitalize
the surrounding neighborhood. The

The Housing program totals $41 million
and is funded with various federal grant
funds and 2001 bonds.
The Housing program provides for the
purchase and modernization of housing
units for low-income families throughout
the city.
Grant-funded modernization projects
are planned based on the availability of
these funds. Federal funds planned to
acquire new scattered-site homes include
proceeds from sales of existing
scattered-site homes. City Council
approved allocations of Community
Development Block Grant funds also
are programmed.

155

Human Services
The $16.5 million Human Services
program is funded with 2001 bonds.
This program provides for completion of
the Westside, Pecos and Shadow Mountain
Senior Centers and the South Family
Services Center. Funding for the purchase
of land for the North Family Services
Center and development of a Family
Transitional Living Center also is included.

with the Phoenix Regional Wireless
Network project
■

■

■

■

Information Technology

Acquisition of information system
management and security software
and hardware
Improvement of data communications
infrastructure
Stabilization of the telephone system

Libraries

The $26.8 million Information Technology
program is funded with 2001 bonds,
Water and Wastewater revenues,
Solid Waste Disposal revenues, Aviation
revenues, Civic Plaza operating funds,
lease-purchase funds, participation from
other cities and Arizona Highway User
Revenue funds. Projects planned for
2001 bond funding include the following:
■

Implementation and improvement
of e-commerce

Continuing work to replace the public
safety and public service radio system

The Libraries program totals $18.7 million
and is funded with General funds, impact
fees and 2001 bonds. Projects for 2001
bond funding include the following:
■

■

■

Completion of the Cesar Chavez
Regional Branch Library
Acquisition of land for a North
Gateway Branch Library
Acquisition of land for the Harmon
Branch Library replacement

■

■

■

■

Acquisition of land for a Desert View
Branch Library
Acquisition of land for the West
Ahwatukee Branch Library
Design of the South Mountain
(southeast) Branch Library
Construction of the Adobe Mountain
Regional Branch Library

General funds are planned to construct
minor improvements to the Cholla Branch
Library. Impact fees are planned to
acquire sites for new libraries in North
Gateway, West Ahwatukee and for the
design of the Estrella Branch Library.

Neighborhood Services
The Neighborhood Services program totals
$10.6 million and funded with Industrial
Development Authority (IDA) loan
proceeds, Community Development Block
Grant (CDBG) funds, lease-purchase
funds, and 2001 bonds. 2001 bond funds
are planned to construct neighborhood

ch ,
ew es t br a n
en ed it s n
op
ry
ra
P u bl ic L ib
e P h oe n ix
th e ci ty.
ry 20 05 , th
a
se ct io n of
ru
st
eb
ea
F
th
In
or
n
e
th
om , in
D es er t B ro

156

infrastructure, eliminate blight and
revitalize neighborhoods. General funds,
lease-purchase funds, CDBG funds and
IDA loan proceeds are planned for infill
projects. In addition, CDBG funds are
planned for blight elimination projects.
The program total includes the
impact of a General fund budget
reduction of $103,000 for blight
elimination/revitalization projects.

Parks, Recreation
and Mountain Preserves

The following major projects are
included in 2001 bond-funded
improvements:
■

■

■

■

■

The Parks and Recreation program totals
$295.6 million and is funded with 1988
bonds, 2001 bonds, Parks Monopole Sites
revenue, impact fees and Parks and
Preserves Initiative funds. The program
provides for acquisition and development
of new park sites and specialty areas and
improvements to existing parks.

■

■

■

Acquisition of land in the Ahwatukee
Foothills area
Construction of Rio Salado Parks
Operations Center
Restoration of the Rio Salado Habitat
Construction of the Washington Adult
Center Expansion
Installation of youth sports lighting
citywide
Design and construct improvements
to Papago Park
Improvement and renovation of
parks citywide
Renovation of aquatics facilities
citywide

■

■

■

Renovation of Boys’ and Girls’ Club
facilities citywide
Renovation of Memorial Hall at
Steele Indian School Park
Renovation of the Phoenix Center
for the Community Arts

Parks and Preserves projects include
regional parks development, improvements
to community and neighborhood parks and
land acquisition for the Sonoran Preserve.
Development impact fees are planned to
acquire and develop park sites in the
Ahwatukee, Deer Valley, Desert View,
Estrella, Laveen and North Gateway areas
and to acquire open space preserve land in
the northern areas. Parks Monopole Sites
revenue is planned to add amenities to
parks with monopole sites.

P a p a go P a
rk co ve rs
1, 20 0 a cr es
bi ke p a th s
a n d fe a tu
a s w el l a s
re s p ic n ic
a zo o, a bo
si te s, fi sh in
ta n ic a l ga
g la go on s
rd en , fi re
and
m u se u m a
n d a go lf
co u rs e.

157

Police Protection

Public Transit

Storm Sewers

The Police Protection program totals
$31.8 million. This program is funded
with 2001 bonds.
The following projects are planned
for 2001 bond funding:

The $1.0 billion Public Transit program is
funded with Transit 2000 revenue, Transit
lease-purchase funds, and federal and
state grants.
Phoenix voters approved Transit 2000,
a 0.4 percent sales tax, on March 14, 2000,
to fund extensive improvements to the
city’s public transit system. Projects
planned in the Public Transit program with
these revenues include bus acquisition,
new passenger facilities, technology
enhancements, improvements to bus stops
and shelters, upgrades to maintenance
facilities, bus pullouts and rapid transit
and light rail planning and construction.
Federal and state grant funds are
planned to purchase buses, construct
passenger facility improvements,
construct light rail, upgrade maintenance
facilities and enhance technologies.

The Storm Sewers program totals
$52.4 million and is funded with 2001
bonds, Capital Construction funds, impact
fees and participation by other agencies.
This program is scheduled to coordinate
with the Major Street construction
program and provides for construction of
storm sewer lines, detention basins and
other facilities to control flooding.
Storm drainage construction for 2001 bond
funding includes the following projects:

Solid Waste Disposal

■

■

■

■

■

■

■

Acquire land for new police precincts
Design improvements to the police
firing range and construct
improvements to the police
driving track
Construct renovations to Phoenix
Police Department headquarters
and other facilities
Complete construction and equip
a new forensics crime lab
Acquire land, design and construct
a neighborhood police station in the
Ahwatukee Foothills area
Complete replacement of mobile data
terminals in vehicles, motorcycles
and hand units.

The $81.8 million Solid Waste Disposal
program includes projects at the city’s
landfills and is funded with Solid Waste
Disposal revenue, Solid Waste Remediation
funds and nonprofit bond funds.
Projects at the Skunk Creek Landfill
include the methane gas extraction
systems, cell lining, capping and
landscaping. Improvements to the
19th Avenue Landfill include maintaining
soil capping and the methane gas
collection system. Projects at the 27th
Avenue Landfill include transfer station
hopper and floor repairs, painting,
landscaping and upgrading recycling
equipment. In addition, the Solid Waste
Disposal program includes cell excavation
and construction of a drainage system
and methane gas system for the new
SR85 landfill.

■

■

■

■

■

■

■

■

■

■

■

■

■

28th Street, Red Mountain Freeway
to Thomas Road storm drain
35th Avenue, Broadway Road to the
Salt River storm drain
Deer Valley Road, 16th to 20th streets
storm drain
24th Avenue and Camelback Road
detention basin
26th Avenue and Verde Lane
detention basin
Bethany Home Road Outfall Channel
51st Avenue, Dobbins to Laveen
Conveyance Channel storm drain
51st Avenue, Laveen Conveyance
Channel to Salt River storm drain
36th Avenue, Thomas to Indian School
roads storm drain
28th Street, Thomas to Indian School
roads storm drain
Camelback Road, Agua Fria to 99th
Avenue storm drain
Cave Creek, Bell Road to Union Hills
Drive storm drain
Cave Creek, Union Hills Drive to
Pima Freeway storm drain
23rd Avenue and Roeser detention
basin

In addition, 2001 bond funds are
planned to construct local drainage
improvements, provide floodplain survey
assistance and rehabilitate existing
storm drains.

158

Major Streets and Bridges

Other Street Improvements

Traffic Improvements

The $292.4 Major Street program is funded
with Arizona Highway User Revenues
(AHUR), Capital Construction funds, 2001
bonds, impact fees and participation by
other agencies. This program provides
for the construction of 28 miles of major
arterial streets over the next five years.
Major street construction for 2001 bond
funding includes the following projects:

The Other Streets program totals
$156.8 million and is funded with Arizona
Highway User Revenues, 2001 bonds,
Community Development Block Grants
(CDBG), Capital Construction funds and
participation from other agencies. The
Other Streets program includes funds
for local paving projects, mid-block
streetlights, bikeways, residential street
resurfacing, major street overlay and
micro-seal, sidewalks and ramps.
The program also includes the annual
concrete repair and slurry seal programs.
Capital Construction funds are included
for dust control to stabilize dirt
shoulders and alleys.
The program total includes the impact
of General Fund budget reductions of
$1.3 million. These reductions consist
of $432,000 to the annual Alley Dust
Proofing program and $833,000 to the
micro-seal program.

The Traffic Improvements program totals
$61.5 million and is funded with Arizona
Highway User Revenues, impact fees,
Capital Construction funds and
participation by other agencies. This
program includes traffic congestion,
screen wall projects, speed humps,
painting, bottleneck removal projects,
upgrade of the traffic signal system,
new warranted traffic signals and left
turn arrows.
Arizona Highway User Revenue funds
are programmed for construction of a
pedestrian underpass at 25th Street
and Camelback Road.
Capital Construction funds are
included in the program for traffic safety
and calming projects. Funds will be
allocated to specific traffic improvement
projects as needs are identified.

■

■

■

■

■

Deer Valley Road, Seventh Street
to Cave Creek Road
75th Avenue, Buckeye Road to
Van Buren Street
Acquire right-of-way for East-West
Parkway in the Sonoran Desert
Preserve
35th Avenue Bridge at Salt River
Black Mountain Parkway, Deer Valley
to Pinnacle Peak roads

Major street construction for AHUR
funding includes the following projects:
■

19th Avenue, Baseline Road to
Southern Avenue

■

Van Buren Street, 59th to 67th avenues

■

Van Buren Street, 67th to 75th avenues

■

■

■

■

■

■

Pinnacle Peak Road, 43rd to
51st avenues
Pinnacle Peak Road, 40th to
48th streets
Pinnacle Peak Road, 48th to
56th streets
Pinnacle Peak Road, 64th Street
to Scottsdale Road
32nd Street, Southern Avenue
to Broadway Road
Retrofit Program

Development impact fees are
planned for street improvements in the
Laveen area.

159

Wastewater
The Wastewater program totals $933.8
million and is funded with Wastewater
operating revenue and nonprofit
corporation bonds, impact fees, federal
aid and other cities' participation in the
91st Avenue Wastewater Treatment Plant
(SROG) joint venture.
Major projects programmed at the
91st Avenue Wastewater Treatment Plant
include support system upgrades, odor
control facilities, instrumentation and
control improvements, metering station
upgrades, security improvements and
unified plant expansion.
Other major Wastewater projects
include the following:
■

■

■

■

■

■

■

Rehabilitation of critical sections of
the Salt River outfall interceptor sewer
owned by SROG cities
■

■

■

■

■

Construction of a reuse/river
restoration project at Tres Rios
Design and construction of Salt River
Outfall and Southern Avenue
Interceptor Parallel sewers to meet
wastewater system flow demands
Construction of odor control facilities
for the Salt River Outfall and Southern
Avenue Interceptor sewers
Construction of replacement sewer
lines entering the 23rd Avenue
Wastewater Treatment Plant to
increase cleansing velocities
and capacity

Conversion to multi-phase sludge
digestion at the 23rd Avenue
Wastewater Treatment Plant
Repair and replacement of equipment
at the 23rd Avenue Wastewater
Treatment Plant
Security improvements at remote
facilities
Sewer lift station improvements
and construction of a sewer lift station
at 107th Avenue and Roeser
Construction of parallel sections of
the Broadway Sewer from 32nd Street
to 51st Avenue to provide needed
additional capacity
Rehabilitation and capacity
improvements for selected sewers
of various sizes and materials located
throughout the city
Sewer relocations for light rail

■

■

■

■

■

■

■

■

Water
The $926.6 million Water program is
funded with Water operating revenue and
nonprofit corporation bonds, impact fees,
capital reserve funds and city of Mesa
participation in the Val Vista Water
Treatment Plant joint venture.
In addition to water line construction,
major projects programmed include
the following:
■

■

■

■

■

■

■

Construction of new wells and
rehabilitation of existing wells

■

Construction of new reservoirs and
rehabilitation of existing reservoirs

■

Construction of new booster stations
and rehabilitation of existing
booster stations

■

■

160

Rehabilitation of steel tanks
Construction of arsenic treatment
facilities at various well sites
Construction of the new Supervisory
Control and Data Acquisition System
(SCADA) control facility and
training center
Cave Creek Water Reclamation Plant
rehabilitation and security upgrades
Construction of a new water treatment
plant at 15th Avenue and Dobbins
Replacement and rehabilitation of the
Val Vista Transmission Main from the
Val Vista Water Treatment Plant (WTP)
to 48th Street
Conversion of plant filtration to
granular activated carbon at Val Vista,
Deer Valley, 24th Street and
Union Hills WTPs
Security upgrades at Val Vista,
Deer Valley, 24th Street and
Union Hills WTPs and remote facilities
Rehabilitation of the Val Vista,
Deer Valley, 24th Street and
Union Hills WTPs
Investigate limits of soil erosion
beneath the Deer Valley WTP
Construction of a new water
distribution maintenance yard
Construction of water main
improvements recommended in
the integrity study
Construction of new mains in
growth areas
Upgrade/replace the billing system
Acquisition of additional water
resources
Relocations for light rail

SUMMARY OF 2005-10 CAPITAL IMPROVEMENT PROGRAM
(In Thousands of Dollars)

Program
Arts and Cultural Facilities
Aviation
Civic Plaza
Downtown Development
Energy Conservation
Facilities Management
Fire Protection
Freeway Mitigation

2005-06
$

8,350
391,098
401,590
107,112
2,642
10,288
32,609
5,017

Historic Preservation
HOPE
Housing

2,754
9,260
19,637

Human Services
Information Technology
Libraries

16,454
26,828
18,493

2006-07
$

_
143,060
13,150
62,244
1,250
5,200
_

2007-08
$

_

2008-09
$

_

2009-10
$

_

38,060
3,100
69,910
1,250
5,265
_
_
_

6,440
3,000
59,656
1,250
3,750
_
_
_

300
5,731
_
_

350
4,931
_
_

4,911
_
_

200

_

_

_

1,848
606
1,250
5,771
_
_

1,236
3,310
900
1,388
350
_
_
_
_

5-Year Total
$

8,350
579,894
424,150
299,842
7,780
34,853
32,609
6,865
3,360
11,160
40,981
16,454
26,838

Neighborhood Services
Parks, Recreation and Mountain Preserves
Police Protection
Public Transit
Solid Waste Disposal

9,011
174,053
31,818
459,091
28,326

400
39,872
_

400
32,710
_

400
28,200
_

400
20,800
_

247,589
33,512

164,394
11,294

62,293
4,217

104,373
4,500

18,693
10,611
295,635
31,818
1,037,740
81,849

Storm Sewers
Streets - Major Streets
Streets - Other Streets

37,980
100,022
37,114

11,461
54,618
26,610

1,000
53,569
28,300

1,000
43,500
29,443

1,000
40,695
35,341

42,441
292,404
156,808

Streets - Traffic Improvements
Wastewater
Water

21,831
157,394
184,943

8,819
165,408
213,950

9,515
315,102
133,000

10,816
138,731
211,375

10,511
157,124
183,375

61,492
933,759
926,643

$2,303,715

$1,036,818

$872,900

$609,372

$570,214

$5,393,019

Total

161

SUMMARY OF 2005-10 CAPITAL IMPROVEMENT PROGRAM
BY SOURCE OF FUNDS
(In Thousands of Dollars)
Source of Funds
General Funds
Parks and Preserves
Transit 2000
Capital Construction
Arizona Highway Users
Community Reinvestment
Other Restricted
Community Development Block Grants (CDBG)
HOPE Grant
Grant Funds
Aviation
Water
Wastewater
Solid Waste

2005-06

2006-07

2007-08

2008-09

2009-10

5,670
33,507
194,282
20,253
64,138
900
143
400
1,250
_

$ 6,015
29,210
138,965
20,939
61,840
900
_

$ 4,500
24,700
42,992
21,646
60,418
900
_

$ 1,410
17,300
56,542
22,379
63,068
900
_

400
300
_

600
350
_

600
_
_

18,510
47,928
27,881
2,500

2,360
46,059
28,638
2,750

940
54,838
28,130
3,000

736
57,739
27,031
3,439

22,715
174,066
528,076
116,648
326,238
5,338
817
4,447
8,749
1,250
56,386
246,182
141,475
15,038

6,655

3,105

3,100

3,000

3,138

18,998

$ 384,184

$ 420,467

$341,476

$246,014

$274,282

$1,666,423

$

$

$

Civic Plaza

Total Operating Funds
Property Tax Supported:
1981 Various Purpose
1988 Various Purpose

75
2,372

$

_

1989 Historic Preservation

159

828
_

2001 Various Purpose
Nonprofit Corporation Bonds:
Aviation

276,234

11,681

$

_

$

_

$

_

$

$

75

_

_

_

3,200

_
_

_
_

_
_

159
287,915

229,075

47,550

385,345
88,646
136,513

10,025
104,964
157,359

5,700
_

5,500
_

500
_

165,829
80,259

72,600
142,866

99,557
123,352

395,370
531,596
640,349

$1,118,419

$ 332,407

$251,788

$220,966

$233,409

$2,146,989

$

$

10,244
91,364
31,750

$ 11,784
76,574
30,000

$ 9,704
58,776
_

$ 2,742
_
_

$ 111,630
669,026
117,148

46,908
3,151

41,465
993

127,557
980

46,910
1,217

33,060
1,061

295,900
7,402

146,089
24,962
2,386
750
2,000

102,327
5,801
_
_
_

29,160
3,581
_
_
_

24,033
1,752
_
_
_

32,543
3,117
_
_
_

334,152
39,213
2,386
750
2,000

Total Other Capital Sources

$ 801,112

$ 283,944

$279,636

$142,392

$ 72,523

$1,579,607

TOTAL

$2,303,715

$1,036,818

$872,900

$609,372

$570,214

$5,393,019

Civic Plaza
Wastewater
Water

Total Bond Funds
Impact Fees
Lease Purchase
Passenger Facility Charge
Other Cities’ Share SROG and Val Vista
Solid Waste Remediation
Capital Grants
Federal, State and Other Participation
Parks Capital Gifts
Private Participation
Other Capital

162

5,120
69,349
75,295
31,431
76,774
1,738
674
2,447
6,849
1,250
33,840
39,618
29,795
3,349

5-Year Total

77,156
442,312
55,398

288,325

2005-06 CAPITAL IMPROVEMENT PROGRAM
BY SOURCE OF FUNDS
(In Thousands of Dollars)

Arts and Cultural Facilities
Aviation
Civic Plaza
Downtown Development
Energy Conservation
Facilities Management
Fire Protection
Freeway Mitigation
Historic Preservation
HOPE
Housing
Human Services
Information Technology
Libraries
Neighborhood Services
Parks, Recreation and Mountain Preserves
Police Protection
Public Transit
Solid Waste Disposal
Storm Sewers
Streets - Major Streets
Streets - Other Streets
Streets - Traffic Improvements
Wastewater
Water

Total

Total
Program

Pay-AsYou-Go
Operating

$8,350
391,098
401,590
107,112
2,642

$639
33,719
4,725
1,738
2,642

20,288
32,609
5,017
2,754
9,260
19,637
16,454
26,828
18,493
9,011
174,053
31,818
459,091
28,326
37,980
100,022
37,114
21,831
157,394
184,943

4,168
_
_
_

$2,303,715

8,113
_
_
7,212
200
1,632
75,002
_

Misc.
Bonds *

$

_
75
_
_
_
_
_
1,534
159
_
_
_
_
_
_
_

82,845
2,953
1,520
42,674
34,380
14,812
28,200
37,010

458
380
_
_
_
_
_
_
_

$384,184

$2,606

2001
Bonds

$7,711
_
10,265
2,304
_
13,940
30,410
3,482
2,595
1,147
10,682
16,454
17,554
15,539
7,089
39,232
27,714
_
_

Nonprofit
Corporation
Bonds

Other
Capital
Sources

_
$
229,075
386,345
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_
_

_
$
128,230
255
103,070
_
2,180
2,200
_
_
_
8,955
_

100

88,646
135,513

2,062
2,754
290
59,361
3,724
376,246
25,373
10,319
14,159
2,047
7,019
40,548
12,320

$276,234

$839,579

$801,112

26,141
43,189
686
_
_

*Remaining 1981, 1988 and 1989 bond funds.

163

RESOURCES AND EXPENDITURES BY CAPITAL FUND
2005-06 CAPITAL IMPROVEMENT PROGRAM
(In Thousands of Dollars)
RESOURCES

Capital Fund

Beginning
Balance

Projected
Revenue *

EXPENDITURES

Total

FUND BALANCES
Ending
Fund
Balances

Estimated
Expenditures

Available
For Sale

Funds
Available
Beyond
6/06

Bond and Related Funds
Affordable Housing & Service Facilities**
2001 Affordable Housing & Homeless Shelter
Criminal Justice & Productivity Improvements
2001 Educational, Youth & Cultural Facilities
2001 Environmental Improvement & Cleanup
Equipment Repair
Fire Protection, Criminal Justice
& Municipal Center**
2001 Fire Protection Facilities & Equipment
Freeway Mitigation, Neighborhood
Stabilization & Slum & Blight Elimination**
Historic Preservation**
Libraries
2001 New & Improved Libraries
2001 Neighborhood Protection & Senior Centers
2001 Parks, Open Space & Recreation
Parks, Recreation & Mountain Preserve**
Police Protection**
2001 Police Protection Facilities & Equipment
2001 Police, Fire & Computer Technology
2001 Preserving Phoenix Heritage
Storm Sewers**
2001 Storm Sewers
2001 Street Improvements
Other Streets**
Various Aviation**
Various Civic Plaza**
Various Solid Waste**
Various Water**
Various Wastewater**
Various Other**

_
_
_
_
_
_

$
53)
(10,146)
_)
(13,480)
(6,105)
_)

261)
(9,620)

_
_

261)
(9,620)

(643)
464)
_)
(9,687)
(14,708)
(11,793)
460)
(507)
(41,247)
(12,725)
(3,621)
(1,987)
(7,942)
(24,292)
(1,110)
41,294)
(204,328)
(18,175)
(331,223)
(107,893)
447)

_
_
_
_
_
_
_
_
_
_
_
_
_
_
_

(643)
464)
_)
(9,687)
(14,708)
(11,793)
460)
(507)
(41,247)
(12,725)
(3,621)
(1,987)
(7,942)
(24,292)
(1,110)
41,995)
(204,328)
(18,175)
(331,223)
(107,893)
447)

$

53)
(10,146)
_)
(13,480)
(6,105)
_)

$

701
_
_
_
_
_

$

_
18,463
_
22,388
8,892
_
_
25,722
1,534
159
_
15,538
26,425
33,114
458
380
23,227
28,075
2,113
_
26,141
46,132
_
229,150
385,345
22,222
136,513
88,646
_

$

53)
(28,609)
_)
(35,868)
(14,997)
_)

$

261)
(35,342)

_ $
28,700
_

53
91
_

36,000
15,500
_

132
503
_

_
35,500

261
158

3,300
_
_

1,123
305
_

25,300
41,860
46,500
_

75
727
1,593
2
93
826
_

(2,177)
305)
_)
(25,225)
(41,133)
(44,907)
2)
(887)
(64,474)
(40,800)
(5,734)
(1,987)
(34,083)
(70,424)
(1,110)
(187,155)
(589,673)
(40,397)
(467,736)
(196,539)
447)

980
65,300
40,800
6,300
1,987
43,470
71,500
1,110
319,045
600,000
84,268
935,000
672,000
_

461,700
N/A
N/A
N/A
N/A
N/A
145,000
N/A

566
_
9,387
1,076
_
131,890
10,327
43,871
467,264
475,461
447

Other Financing
Lease Purchase
Capital Reserves
Capital Grants
Impact Fees
Other Cities’ Participation in Joint Ventures
Proceeds - Sale of Capital Assets
Passenger Facility Charge***
Responsible Party Remediation Funds

TOTAL

220,282)
228,515)
2,807)
124,903)
_)
21,422)
51,762)
9,721)

$(128,841)

_
_

420,090
_

312,844
_

220,282)
228,515)
176,994)
124,903)
46,908)
21,422)
364,606)
9,721)

174,187
77,156
46,908
2,000
68,759
3,151

(199,808)
228,515)
2,807)
47,747)
_)
19,422)
295,847)
6,570)

$534,640

$405,799)

$1,932,888

$(1,527,089)

174,187
_
46,908
_

261,892
228,515
2,807
47,747
_
19,422
440,847
6,570

$3,681,120 $2,154,031

*Includes bond proceeds and funds which “pass through” bond funds such as grants, land sales and other agency and private participation.
164 **Includes various bond funds approved by the voters prior to 2001.
***Estimated expenditures include $13.4 million for Aviation capital debt service payments.

Operating Costs for New Capital Facilities

O

n March 13, 2001, Phoenix voters
approved a $753.9 million bond program,
as recommended by the Citizens’
Bond Committee. As part of their
recommendation, the bond committee
included a careful analysis of the impact
of operating costs, cost savings and
revenues on the General Fund. To help
offset the net operating costs associated
with the new program, the bond committee
recommended that $7 million be shifted
from secondary property taxes (used for
the payment of debt service) to primary
property taxes (a General Fund revenue
source) in fiscal year 2003-04, and that
an additional $3 million be shifted from
secondary property taxes to primary
property taxes in 2004-05. This shift
would then remain in place at no more
than the combined $10 million per year.
The combined property tax rate would
remain at the current $1.82.

Then in 2003, in response to a
projected shortfall in the General Fund,
the bond committee recommended that
2003-04 projects requiring General
Fund operating costs be delayed.
Land acquisition, design and other
non-operating cost projects were
advanced with the overall bond program
remaining a five-year program. The bond
committee’s recommended changes
reduced General Fund operating costs for
2003-04 from $9.5 million to $3.6 million.
Based on the bond committee’s latest
schedule, the full year’s impact of facilities
operated with General Funds and opening
in 2005-06 is $2.4 million. Projects
opening beyond 2005-06 are estimated
to result in $3.9 million in new General
Fund operating costs.
Multi-year rate planning processes
are used by enterprise operations to
provide the City Council with the effects
new capital facilities will have on future
rate-payers. That is, each year, the City
Council considers the impact of future
capital facilities as it sets annual utility
rates. Rates are increased today to pay
for tomorrow’s facilities.

Finally, for more than 20 years
the energy conservation program has
generated annual cost savings in excess
of $250,000. This program provides for
energy efficient retrofits, energy efficient
design and metering for efficient
operations.
Each fall, departments are asked to
review all capital projects, their estimated
completion dates and any costs associated
with operating new facilities and systems.
The 2005-06 budget includes $29 million in
new operating and maintenance costs for
new facilities and systems.
The schedule on the next page provides
operating and maintenance costs for the
2005-06 budget, along with the full-year
operating and maintenance costs for the
2006-07 fiscal year and the source of funds
that would be used for these costs.

167

OPERATING COSTS FOR NEW CAPITAL FACILITIES
2005-06

2006-07

$22,340,000

$22,206,000

270,000

420,000

206,000
198,000
48,000

224,000
216,000
42,000

92,000
57,000
35,000
98,000
133,000
116,000
279,000
143,000

183,000
85,000
42,000
196,000
212,000
122,000
282,000
108,000

318,000

234,000

93,000

82,000

539,000

874,000

620,000
114,000
133,000

865,000
129,000
133,000

Aviation
Rental Car Center and Bus Maintenance Facility

Fire
Fire Communications Operators

Human Services
Westside Senior Center
Shadow Mountain Senior Center
Devonshire Senior Center

Parks and Recreation
Memorial Hall Renovation
Indian Bend Wash Park
Community Park at 17th Avenue & Peoria
Cesar Chavez Park
HOPE VI Coleman Recreation Center and Park
Bethany Home Outfall Channel
Camp Colley
New Street Landscaping Maintenance

Police
Twin Engine Helicopter - Operation and Maintenance

Public Works
Phoenix Art Museum Expansion

Public Works - Solid Waste
North Gateway Transfer Station

Water Services
Arsenic Treatment Program (at 15 wells)
Chlorine Containment Phase 3
Well #296

168

OPERATING COSTS FOR NEW CAPITAL FACILITIES (continued)
2005-06

2006-07

94,000
257,000
646,000
759,000
80,000
40,000
43,000
65,000
41,000
1,205,000

85,000
636,000
672,000
585,000
110,000
56,000
55,000
65,000
56,000
1,205,000

$29,062,000

$30,180,000

2,086,000
22,340,000
867,000
3,230,000
539,000

2,448,000
22,206,000
1,127,000
3,525,000
874,000

$29,062,000

$30,180,000

Wastewater Services
23rd Avenue WWTP Security System
91st Avenue WWTP Unified Plant 1 Expansion
Tres Rios Constructed Wetlands Demo Project
North Gateway Pump Station
91st Avenue WWTP Chlorine Facility
91st Avenue WWTP Multi-Phase Digestion
23rd Avenue WWTP Chlorine Facility
91st Avenue WWTP Security System
23rd Avenue WWTP Headworks Improvement Project
Odor Control Sites (4 locations)

Net Total Costs
Source of Funds
General
Aviation
Water
Wastewater
Solid Waste Disposal Operating

Total Source of Funds
*

169

SCHEDULE 1: RESOURCES AND EXPENDITURES BY FUND
(In Thousands of Dollars)
Resources

Expenditures

Beginning
Fund
Balances

Revenue

Recovery

General
Parks and Recreation
Library
Cable Communications

$35,189
_
_
_

$234,724
11,977
1,673
8,785

$1,500
_
_
_

$709,977
82,774
31,888
_

$141,844
_
_

Total General Funds

$35,189

$257,159 *

$1,500

Fund Transfer
To
From

Total

Operating

Capital

$834,626
94,750
33,361
5,314

$4,920
_

3,472

$839,546
94,751
33,561
5,313

$824,639

$145,316

$973,171

_

General Funds:

Special Revenue Funds:
Excise Tax
Neighborhood Protection - Police
Neighborhood Protection - Fire
Neighborhood Protection Block Watch Grants
Public Safety Enhancement
- Police
Public Safety Enhancement
-Fire
Parks and Preserves
Transit 2000
Court Awards
Development Services
Capital Construction
Sports Facilities
Arizona Highway User Revenue
Local Transportation Assistance
Regional Transit
Community Reinvestment
Secondary Property Tax and
GO Bond Redemption
Impact Fee Program
Administration
City Improvement
Other Restricted Funds
Grant Funds

200
_

$839,546
94,750
33,561
5,314

_
_
_
_

$968,051

$5,120

_

$973,171

_

_

_
_
_

931,803
_
_

_
_
_

931,803
_
_

_

_

19,214
6,869

19,214
6,869

19,214
6,869

_
_
_

_
_
_

19,214
6,869

_
_
_

377

97

_

1,374

_

1,848

1,200

_

_

1,200

648

_

_

_

10,315

_

10,315

10,315

_

_

10,315

_

_

_
_

_

6,325
27,472
109,888
_
_

_
_

6,325
171
100,804
2,699
51,101
150
5,438
38,680
7,130
9,181
117

_

_
_

193
_
_
_
_

6,325
76,161
258,452
2,716
74,480
32,323
25,625
149,749
7,130
15,395
7,044

1,738

6,919
34,047
_
_
_

6,325
69,520
176,426
2,699
51,101
31,581
11,957
149,501
7,130
9,181
1,855

260,461

260,461

30,100

_

1,893
69,150
10,188
191,568

2,578
_

48,589
145,322
17
25,128
12,225
10,732
26,256
_

100
500
_
_
_
_

4,663
4,960

1,000
_
_
_

180,100

110,461

_

_

_

290,561

_

_

1,305
_

3,165
_

_

_
_
_

4,470
69,150
23,771
204,718

_
_

9,100
178,395

69,150
_
_

1,893
_

14,671
26,615

_
_
_
_

9,514
178,885

674
10,546

$500,961 $1,462,354

$1,600

$284,666

60,879
125,553
64,273
26,388
60,442
5

240,367
287,350
158,947
111,826
8,964
7,281

_
_
_
_
_
_

15,318
_
_
_
51,270
_

Total Enterprise Funds

$337,540

$814,735

_

$66,588

GRAND TOTAL

$873,690 $2,534,248

Enterprise Funds:

$

27,351
_

69,349
75,295
_
_

19,298
14,761
_
_
_
_

Aviation
Water
Wastewater
Solid Waste
Civic Plaza
Golf Course

Restricted
Fund
Total Balances

_
_
_
_

30,093
2,699
52,977
800
325
122,493
7,130
10,732
2,084

Total Special Revenue
Funds

Lease
Purchase
& Debt
Service

3,625
_

293

$963,265 $1,286,317

5,311
15,811
8,931
4,966
2,030
578

311,253
397,092
214,288
133,248
118,646
6,708

$37,627 $1,181,236

31,431
_
76,774
_
_

$449,684 $265,807

327
_
_
_

69,150
_
2,137

66,474
86,639
51,985
17,219
27,635
579

$586,359 $113,257

$250,531

$3,100 $1,175,893 $1,146,208 $3,440,724 $2,004,094 $384,184

6,214
5,188

13,584
13,150

$372,641 $1,088,132 $198,184

33,840
39,618
29,795
3,349
6,655
_

192,841
168,009
90,679
95,961
32,744
6,125

_
6,641
82,026
17
23,379
742
13,668
247
_

293,155
294,266
172,459
116,529
67,034
6,703

18,098
102,826
41,829
16,720
51,611
5

$950,147 $231,089

$623,172 $3,011,449 $429,273

*General fund sales tax revenue is reflected as a transfer from the excise tax fund. Total transfer equates to $665.0 million, and is included in the General
Funds total of $922.2 million shown on Schedule 2.

173

SCHEDULE 2: REVENUES BY MAJOR SOURCE
(In Thousands of Dollars)

2003-04
Actuals

2004-05
Estimate

2005-06
Budget

$335,140

$360,309

State Sales Tax

111,594

State Income Tax

119,118

Revenue Source

Increase/(Decrease)
From 2004-05 Estimate
Amount

Percent

$389,230

$28,921)

8.0%

122,554

134,822

12,268)

10.0

121,470

138,455

16,985)

14.0

53,522

57,100

60,765

3,665)

6.4

$284,234

$301,124

$334,042

$32,918)

76,392

83,304

91,311

8,007)

2,650

2,496

2,496

_)

GENERAL FUNDS
Local Sales Taxes and Related Fees
State-Shared Revenues

Vehicle License Tax
Subtotal

Primary Property Tax

10.9%
9.6

User Fees/Other Revenue
Licenses & Permits
Cable Communications
Fines & Forfeitures
Court Default Fee
Engineering & Architectural Services

8,257

8,529

8,785

256)

17,873

18,883

20,070

1,187)

3.0
6.3

839

928

1,079

151)

16.3

2,798

1,752

2,529

777)

44.3

21,072

26,692

30,153

3,461)

13.0

1,038

1,300

1,325

25)

1.9

995

1,024

1,673

649)

63.4

Parks & Recreation

4,038

3,358

3,467

109)

3.2

Planning

3,013

1,444

1,471

27)

1.9

11,084

11,477

11,536

59)

0.5

Street Transportation

2,267

2,618

1,636

(982)

-37.5

Other Service Charges

16,058

17,165

19,886

2,721)

15.9

2,468

2,486

1,473

(1,013)

-40.7

$94,450

$100,152

$107,579

$7,427)

7.4%

$790,216

$844,889

$922,162

$77,273

9.1%

Fire
Hazardous Materials Inspection Fees
Library Fees

Police

Others
Subtotal

Total General Funds

174

_

SCHEDULE 2: REVENUES BY MAJOR SOURCE (Continued)
(In Thousands of Dollars)

Revenue Source

Increase/(Decrease)
From 2004-05 Estimate

2003-04
Actuals

2004-05
Estimate

2005-06
Budget

$23,133

$25,444

$27,554

$2,110)

_

3,788

16,640

12,852)

339.3
3.0

Amount

Percent

SPECIAL REVENUE FUNDS
Neighborhood Protection
Public Safety Enhancement
Parks and Preserves
Transit 2000
Court Awards

8.3%

23,957

26,662

27,472

810)

121,168

131,744

139,981

8,237)

6.3

3,036

3,343

2,699

(644)

-19.3

Development Services

47,036

51,672

52,977

1,305)

2.5

Capital Construction

18,170

19,427

20,098

671)

3.5

Sports Facilities

13,311

14,284

15,086

802)

5.6

Arizona Highway User Revenue

115,438

118,406

122,493

Local Transportation Assistance

7,245

7,130

7,130

4,087)
_)

3.5
_

Regional Transit Revenues

9,531

10,610

10,732

Community Reinvestment

2,094

2,084

2,084

122)
_)

1.1
_

94,923
_

102,356

110,461

8,105)

7.9

3,015

3,165

150)

5.0

7,382

18,713

9,100

(9,613)

-51.4

Secondary Property Tax
Impact Fee Program Administration
Other Restricted Revenues
Grants
Public Housing Grants

66,694

70,371

67,065

(3,306)

-4.7

Human Services Grants

46,630

47,395

43,931

(3,464)

-7.3

Community Development

19,009

22,943

33,381

10,438)

45.5

Criminal Justice Grants

11,575

19,892

7,843

(12,049)

-60.6

Public Transit Grants

9,287

10,365

7,457

(2,908)

-28.1

HOPE VI Grant

4,781

20,695

6,849

(13,846)

-66.9

10,151

15,725

11,869

(3,856)

-24.5

$168,127

$207,386

$178,395

$(28,991)

-14.0

$654,551

$746,064

$746,067

$3)

Aviation

219,275

233,443

240,367

6,924)

3.0

Water System

250,046

256,365

287,350

30,985)

12.1

Other Grants
Subtotal - Grants

Subtotal Special Revenue Funds

0.0%

ENTERPRISE FUNDS

Wastewater System

146,805

152,035

158,947

6,912)

4.5

Solid Waste

100,110

105,958

111,826

5,868)

5.5

Civic Plaza

51,448

55,699

60,234

4,535)

8.1

6,116

6,702

7,281

579)

8.6

$773,800

$810,202

$866,005

$55,803)

6.9%

$2,218,567

$2,401,155

$2,534,234

$133,079)

5.5%

Golf Courses

Subtotal Enterprise Funds

GRAND TOTAL

175

SCHEDULE 3: EXPENDITURES BY DEPARTMENT
(In Thousands of Dollars)

Program

General Government
Mayor
City Council
City Manager
Deputy City Managers
Intergovernmental Programs
Public Information
City Auditor
Equal Opportunity
Personnel
Phoenix Employment Relations Board
Retirement Systems
Law
Information Technology
City Clerk and Elections
Finance
Budget and Research
Engineering and Architectural Services

$1,933
3,344
1,068
2,591
1,180
3,269
2,604
3,491
13,920
219
_
4,394
4,470
6,568
21,689
3,196
(364)

2004-05
Budget

$1,926
4,137
1,325
1,652
1,272
3,435
2,885
3,473
15,530
209
_ )
4,223
5,250 )
6,471
25,848 )
3,388
261

2004-05
Estimate *

Budget

Estimate *

3.4%
5.9
4.1
0.7
2.0
(2.1)
8.8
8.7
1.4
4.0
N/A
5.9
78.7
9.9
1.6
10.6
(180.5)
7.7%

4,198
3,759
6,945
24,339
3,651
(164)

4,446
6,717
7,634
24,721
4,037
132

15.1%
2.4
(3.4)
(0.3)
3.5
(2.8)
5.6
8.0
1.3
12.0
N/A
5.3
27.9
18.0
(4.4)
19.2
(49.4)

6.6%

$84,494

3.9%

$81,285

$78,433

Public Safety
Police
Fire
Emergency Management
Family Advocacy Center

348,067
172,690
226
1,008

382,578
191,800
262
1,075

392,656
191,913
355
1,029

$521,991

$575,715

$585,953

31,886
14,950
3,684

36,742
15,404
3,800

35,830
15,412
3,740

Total Criminal Justice

$50,520

$55,946

$54,982

Transportation
Street Transportation
Aviation
Public Transit

54,089
142,574
119,883

57,063
151,072
134,287

56,618
147,801
147,659

Total Transportation

$316,546

$342,422

$352,078

)

2005-06
Budget

$2,217
4,237
1,280
1,647
1,317
3,339
3,048
3,750
15,738
234
_

$73,572

Criminal Justice
Municipal Court
City Prosecutor
Public Defender

Actual

Percent Change
from 2004-05

10.9%
19.6
15.1
(36.9)
9.4
4.3
7.6
(1.2)
11.5
2.7
N/A)
(4.5)
(15.9)
5.7
12.2
14.2
(54.9)

$2,144
4,000
1,229
1,635
1,291
3,411
2,802
3,450
15,518
225
_

Total General Government

Total Public Safety

176

2003-04
Actual

Percent Change
from 2003-04

12.8
11.1
57.1
2.1
12.3%

12.4
3.1
1.5
8.8%

4.7
3.7
23.2
11.2%

407,588
220,124
682
1,096

6.5
14.8
160.3
2.0

3.8
14.7
92.1
6.5

9.3%

7.4%

38,062
16,445
3,939

3.6
6.8
3.7

6.2
6.7
5.3

$58,446

4.5%

6.3%

$629,490

58,823
182,241
166,212

3.1
20.6
23.8

3.9
23.3
12.6

$407,276

18.9%

15.7%

SCHEDULE 3: EXPENDITURES BY DEPARTMENT (Continued)
(In Thousands of Dollars)

Program

Community Development
Development Services
Planning
Business Customer Service Center
Housing
Community and Economic Development
Downtown Development
Neighborhood Services
HOPE VI Project
Total Community Development
Community Enrichment
Parks and Recreation
Library
Golf
Civic Plaza Convention and
Theatrical Facilities
Human Services
Education and Youth Programs
Rio Salado
Historic Preservation
Office of Arts and Culture
International and Sister Cities Programs
Total Community Enrichment
Environmental Services
Water Services
Solid Waste Management
Public Works
Environmental Programs
Total Environmental Services
Contingencies
GRAND TOTAL**

2005-06
Budget

Budget

Estimate *

$42,701
8,088
855
74,495
8,888
3,755
31,124
_

15.7%
23.5
2.0
12.5
(32.0)
N/A)
6.2)
N/A)

$46,986
7,219
688
77,344
8,134
21,919
47,080
_

17.5%
(9.4)
(19.7)
(3.5)
(43.5)
N/A)
2.9
N/A)

10.0%
(10.7)
(19.5)
3.8
(8.5)
483.7
51.3
N/A)

11.1%

$209,370

10.7%

23.2%

2004-05
Budget

2004-05
Estimate *

$36,897
6,551
838
66,236
13,068
_

$39,986
7,969
857
80,183
14,390
_
45,772 )
_

Percent Change
from 2004-05

Actual

2003-04
Actual

29,297
_

Percent Change
from 2003-04

$152,887

$189,157

$169,906

86,398
28,998
5,437

95,819
31,815
6,227

95,560
31,647
5,981

10.6
9.1
10.0

102,063
34,550
5,965

6.5
8.6
(4.2)

6.8
9.2
(0.3)

31,528
70,212
1,150
110
436
1,806
526

34,832
70,972
1,080
110
501
2,252
536

33,232
73,042
1,027
127
479
2,200
543

5.4
4.0
(10.7)
15.5
9.9
21.8
3.2

36,048
71,661
1,141
138
519
2,243
551

3.5
1.0
5.6
25.5
3.6
(0.4)
2.8

8.5
(1.9)
11.1
8.7
8.4
2.0
1.5

$226,601

$244,144

$243,838

7.6%

$254,879

4.4%

4.5%

180,231
69,251
22,671
1,433

195,059
80,813
24,321
1,871

192,108
80,827
25,368
1,564

$273,586

$302,064

$299,867

9.6%

$328,893

8.9%

9.7%

_

$88,391

_

N/A)

$100,395

13.6%

N/A)

$1,615,703

$1,879,124

$1,785,057

10.5%

$2,073,243

10.3%

16.1%

6.6
16.7
11.9
9.1

210,562
90,664
25,689
1,978

7.9
12.2
5.6
5.7

9.6
12.2
1.3
26.5

*The 2004-05 estimate reflects $959,000 in budget reductions.
**Totals include City Improvement lease purchase payments included in department budget allocations for purposes of this schedule.

177

SCHEDULE 4: EXPENDITURES BY DEPARTMENT
BY SOURCE OF FUNDS INCLUDING BUDGET CHANGES
(In Thousands of Dollars)

Program

General Government
Mayor
City Council
City Manager
Deputy City Managers
Intergovernmental Programs
Public Information
City Auditor
Equal Opportunity
Personnel
Phoenix Employment Relations Board
Retirement Systems
Law
Information Technology
City Clerk and Elections
Finance
Budget and Research
Engineering and Architectural Services

2005-06
Budget

General
Funds

Enterprise
Funds

_
_
_

Special
Revenue
Funds **

_)
(7)
_)
(18)
_)
_)
(7)
(7)
(31)
_)
_)
(11)
(33)
(8)
(4)
_)
_)

$(49)
(102)
_)
(218)
(33)
(78)
(79)
(80)
(381)
_)
_)
(190)
(99)
(161)
(597)
(88)
(14)

$2,217
4,237
1,280
1,647
1,317
3,339
3,048
3,750
15,738
234
_

$2,102
4,237
1,280
1,355
1,303
3,331
3,048
3,341
14,520
234
_

4,446
6,717
7,634
24,721
4,037
132

4,400
4,989
7,468
22,946
3,531
49

1,744
_
_

46
1,565
166
31
506
83

$(126)

$(2,169)

$84,494

$78,134

$2,199

$4,161

(58)
(156)
_)
_)

(556)
(1,485)
_)
(27)

407,588
220,124
682
1,096

364,049
198,091
285
1,037

782
_
_
_

42,757
22,033
397
59

$(214)

$(2,068)

$629,490

$563,462

$782

$65,246

_)
(13)
(77)

(220)
425)
(22)

38,062
16,445
3,939

30,757
15,506
3,939

_
_
_

7,305
939
_

$(90)

$183)

$58,446

$50,202

_

$8,244

Transportation
Street Transportation
Aviation
Public Transit

_)
_)

58,823
182,241
166,212

19,667
_

_

39,156
_

_)

(26)
23,754)
(376)

Total Transportation

_)

$23,352)

$407,276

Total General Government
Public Safety
Police
Fire
Emergency Management
Family Advocacy Center
Total Public Safety
Criminal Justice
Municipal Court
City Prosecutor
Public Defender
Total Criminal Justice

178

2005-06
2004-05
Additions /(Reductions)*

292
_
_
_
_
_
_
_
_
163
_

$115
_
_
_
14
8
_
409
1,218
_
_

25,146

182,241
_

141,066

$44,813

$182,241

$180,222

SCHEDULE 4: EXPENDITURES BY DEPARTMENT
BY SOURCE OF FUNDS INCLUDING BUDGET CHANGES (Continued)
(In Thousands of Dollars)

Program

Community Development
Development Services
Planning
Business Customer Service Center
Housing
Community and Economic Development
Neighborhood Services
HOPE VI Project
Downtown Development
Total Community Development
Community Enrichment
Parks and Recreation
Library
Golf
Civic Plaza Convention and Theatrical Facilities
Human Services
Education and Youth Programs
Rio Salado
Historic Preservation
Office of Arts and Culture
International and Sister Cities Program
Total Community Enrichment
Environmental Services
Water Services
Solid Waste Management
Public Works
Environmental Programs
Total Environmental Services
Contingencies
GRAND TOTAL**

2005-06
2004-05
Additions /(Reductions)*

2005-06
Budget

General
Funds

Enterprise
Funds

_

_
_

Special
Revenue
Funds **

_)
(14)
_)
(327)
_)
(15)
_)
_)

$991)
(184)
(176)
_)
(65)
(258)
_)
(47)

$46,986
7,219
688
77,344
8,134
47,080
_

6,433
298
174
2,754
14,512
_

1,098
_
_

77,170
4,282
32,568
_

21,919

3,396

417

18,106

$(356)

$261)

$209,370

$27,567

$1,905

$179,898

(150)
_)
_)
_)
(14)
_)
_)
_)
(5)
_)

(1,022)
(274)
_)
107)
184)
(19)
_)
(13)
(31)
(14)

102,063
34,550
5,965
36,048
71,661
1,141
138
519
2,243
551

94,751
33,360
_

422
_

1,995
24,953
868
138
519
1,194
551

5,965
28,298
250
_
_
_
_
_

6,890
1,190
_

$(169)

$(1,082)

$254,879

$158,329

$34,935

$61,615

_)
_)

210,562
90,664
25,689
1,978

_
703
18,764
1,336

210,459
89,961
_

103
_

(4)
_)

3,336)
824)
(525)
(39)

$(4)

$3,596)

$328,893

_)

_)

$(959)

$22,073)

390
_

$46,986
786
_

5,755
46,458
273
_
_
1,049
_

207

6,925
435

$20,803

$300,627

$7,463

$100,395

$24,740

$63,671

$11,984

$2,073,243

$968,050

$586,360

$518,833

*Net changes reflect the combined total of budget reductions, budget additions and capital facility operating costs.
**Includes Grants and City Improvement lease purchase funds.

179

SCHEDULE 5: DEBT SERVICE AND LEASE PURCHASE EXPENDITURES
BY PROGRAM AND SOURCE OF FUNDS
(In Thousands of Dollars)

Program

2003-04
Actual

2004-05
Estimate

2005-06
Budget

Aviation
Civic Plaza
Cultural Facilities
Downtown Development
Environmental Programs
Fire Protection
Freeway Mitigation
Golf
Historic Preservation
Information Systems
Libraries
Local Streets/Street Improvements/Lighting
Maintenance Service Centers
Major Streets and Freeways
Municipal Administration Building
Neighborhood Preservation & Senior Services Centers
Parks & Recreation/Open Space
Police, Fire, and Computer Tech
Police Protection
Public Housing
Public Transit
Solid Waste Disposal
Storm Sewer
Street Lighting Refinancing
Wastewater
Water
Early Redemption
Lease Purchase

$55,806
9,633
4,249
8,735
6
2,790
1,411
196
1,352
1,518
4,158
501
587
31,131
2,348
653
16,240
2,936
2,750
5,259
2,739
16,507
21,148
72
45,664
62,940
29,229
18,484

$76,467
9,638
4,897
9,135
23
3,742
1,506
416
1,599
1,450
4,106
1,191
597
29,206
2,413
1,486
16,243
4,056
3,136
5,517
16,730
17,224
21,956
68
48,066
70,218
28,920
20,110

$79,834
27,635
6,318
24,519
490
4,261
944
579
2,324
1,322
5,301
3,250
647
34,047
2,379
2,745
17,808
5,283
4,188
6,452
29,273
17,219
24,174
68
51,985
86,639
173,052
23,799

$349,042

$400,116

$636,535

Total Program

180

SCHEDULE 5: DEBT SERVICE AND LEASE PURCHASE EXPENDITURES
BY PROGRAM AND SOURCE OF FUNDS (Continued)
(In Thousands of Dollars)

Program
Source of Funds
Secondary Property Tax and G.O. Bond Redemption
Transit 2000
Sports Facilities
Arizona Highway User Revenue
City Improvement
General
Transit 2000
Sports Facility
Capital Projects
Public Housing
Aviation
Water
Grant Funds
Aviation
Water
Wastewater
Solid Waste
Civic Plaza
Golf
Capital Funds
Aviation
Total Source of Funds

2003-04
Actual

2004-05
Estimate

2005-06
Budget

$96,586
_

$102,356
326
9,135
29,206

$260,461
327
6,519
34,047

8,129
31,131
17,407
818
606
1,077
74
8,720
156
2,468
47,086
62,784
45,664
16,507
9,633
196

20,110
14,812
_
_
_
_
_

23,799
27,351
18,000
_
_
_
_

2,142
64,464
70,218
48,066
17,224
9,638
416

2,139
66,474
86,639
51,985
17,219
27,635
579

_

12,003

13,361

$349,042

$400,116

$636,535

181

SCHEDULE 6: CAPITAL IMPROVEMENT PROGRAM
FINANCED FROM OPERATING FUNDS
(In Thousands of Dollars)

Program

2003-04
Actual

2004-05
Estimate

2005-06
Budget

Arts and Cultural Facilities
Aviation
Civic Plaza
Downtown Development
Economic Development
Energy Conservation
Facilities Management
Fire Protection
Historic Preservation
HOPE
Housing
Information Technology
Libraries
Neighborhood Services
Parks, Recreation and Mountain Preserves
Public Transit
Solid Waste Disposal
Storm Sewers
Streets - Major Streets
Streets - Other Streets
Streets - Traffic Improvements
Wastewater
Water

$325)
21,872)
(2,974)
2,524)
854)
474)
187)
_)
1)
4,816)
4,610)
189)
4)
2,188)
10,145)
1,902)
4,092)
2,082)
35,921)
35,050)
10,007)
22,660)
55,772)

$8,556
27,659
1,194
4,145
_

$639
33,719
4,725
1,738
_

1,201
845
350
97
21,104
1,132
5,286
_

2,642
4,168
_
_

1,731
10,077
30,728
2,799
1,968
35,144
32,281
9,254
21,640
50,735

7,212
200
1,632
75,002
82,845
2,953
1,520
42,674
34,380
14,812
28,200
37,010

$212,701)

$267,926

$384,184

Total

182

8,113
_

SCHEDULE 6: CAPITAL IMPROVEMENT PROGRAM
FINANCED FROM OPERATING FUNDS (Continued)
(In Thousands of Dollars)
2003-04
Actual

2004-05
Estimate

2005-06
Budget

General Funds:
General
Parks and Recreation
Library

$190)
_)
4)

$1,298
55
_

$4,920
_

Total General Funds

$194)

$1,353

$5,120

9,961)
277)
_)
22,752)
59,919)
133)
1,521)
41)
2,507)
4,816)
8,175)

9,129
27,269
50
20,080
57,402
_

69,349
75,295
_

3,100
9,224
3,831
20,695
6,780

1,738
674
2,447
6,849
1,250

$110,102)

$157,560

$265,807

22,275)
56,196)
22,708)
4,120)
(2,894)

30,817
50,942
22,059
4,032
1,163

33,840
39,618
29,795
3,349
6,655

Total Enterprise Funds

$102,405)

$109,013

$113,257

Total

$212,701)

$267,926

$384,184

Program
SOURCE OF FUNDS

Special Revenue Funds:
Parks and Preserves
Transit 2000
Court Awards
Capital Construction
Arizona Highway Users
Sports Facilities
Community Reinvestment
Other Restricted
Community Development Block Grants (CDBG)
HOPE Grant
Grant Funds
Total Special Revenue Funds

Enterprise Funds:
Aviation
Water
Wastewater
Solid Waste
Civic Plaza

200

31,431
76,774
_

183

SCHEDULE 7: NET INTERFUND TRANSFERS TO THE GENERAL FUND
(In Thousands of Dollars)
2005-06
2003-04
Actual

2004-05
Estimate

Budget

Increase/
(Decrease)

Aviation
Central Service Cost Allocation

$5,180

$5,233

$5,311

$78

Water Funds
Central Service Cost Allocation
In-Lieu Property Taxes
Total

7,083
7,360
14,443

7,017
8,110
15,127

7,122
8,689
15,811

105
579
684

Wastewater Funds
Central Service Cost Allocation
In-Lieu Property Taxes
Total

2,240
5,788
8,028

2,242
6,321
8,563

2,276
6,655
8,931

34
334
368

Solid Waste
Central Service Cost Allocation
In-Lieu Property Taxes
Total

3,960
677
4,637

3,946
719
4,665

4,005
961
4,966

59
242
301

Civic Plaza
Central Service Cost Allocation

2,118

2,000

2,030

30

328

337

342

5

$34,734

$35,925

$37,391

$1,466

TRANSFERS TO THE GENERAL FUND
Enterprise Funds

Golf Courses
Parks Administration

Total from Enterprise Funds

184

SCHEDULE 7: NET INTERFUND TRANSFERS TO THE GENERAL FUND (Continued)
(In Thousands of Dollars)
2005-06
2003-04
Actual

2004-05
Estimate

Budget

Increase/
(Decrease)

$568,502

$606,829

$665,003

$58,174)

3,538

3,571

3,625

54)

Sports Facilities - Central Service Costs
Central Service Cost Allocation
Phoenix Union Parking Maintenance
Total

107
75
182

116
75
191

118
75
193

2)
_)
2)

Public Housing
In-Lieu Property Taxes

246

282

293

11)

$572,468

$610,873

$669,114

$58,241)

)$607,202

$646,798

$706,505

$59,707)

_

_

121

121)

)_

_

3,262

3,262)

17,231

20,110

23,799

3,689)

22

5

_

(5)

96

_

_

_)

)$17,349

$20,115

$27,182

$7,067)

)$589,853

$626,683

$679,323

$52,640)

Special Revenue Funds
Excise
Transfer to General Fund
Development Services
Central Service Cost Allocation

Total from Special Revenue Funds
Total Transfers to the General Fund

Transfers from the General Fund
Transfer to Parking Trust Fund
Transfer to Capital Projects Fund
Transfer to City Improvement
Transfer to Development Services for Fee Waiver
Transfer to Human Services Bonds

Total Transfers from the General Fund
Net Transfers to the General Fund

185

SCHEDULE 8: PERSONNEL SCHEDULE BY DEPARTMENT
Number of Full-Time Equivalent Positions

2003-04
Actual

2004-05
Authorized

2004-05
Reductions

19.0
55.0
8.0
19.0
6.3
32.0
33.5
37.0
113.4
2.0
15.0
245.3
213.0
132.2
294.5
28.0
105.1

20.0
55.0
8.0
22.0
6.3
32.0
38.5
39.0
113.4
2.0
15.0
246.0
217.0
130.2
310.5
32.0
110.1

_)
_)
_)

Total General Government

1,358.3

Public Safety
Police
Fire
Emergency Management
Family Advocacy Center
Total Public Safety

Program

General Government
Mayor
City Council
City Manager
Deputy City Managers
Intergovernmental Programs
Public Information
City Auditor
Equal Opportunity
Personnel
Phoenix Employment Relations Board
Retirement Systems
Law
Information Technology
City Clerk and Elections
Finance
Budget and Research
Engineering and Architectural Services

186

2004-05
Authorized
as of
June 30, 2005

2005-06
Net Changes *

_)
_)
_)
_)
_)
_)
_)
_)
_)
_)
_)

2005-06
Authorized
as of
June 30, 2006

(1.0)
_)
_)
(1.0)
(1.0)
(1.0)
_)
_)
(4.0)
(7.0)
(1.0)
_)
_)
_)

20.0
55.0
8.0
21.0
6.3
32.0
37.5
38.0
112.4
2.0
15.0
242.0
210.0
129.2
310.5
32.0
110.1

3.0)
_)
_)
_)
_)
_)

20.0
55.0
8.0
21.0
6.3
32.0
37.5
38.0
112.4
2.0
15.0
245.0
210.0
129.2
310.5
32.0
110.1

1,397.0

(16.0)

1,381.0

3.0)

1,384.0

3,900.7
1,719.2
1.5
5.0

4,170.7
1,873.2
6.5
5.0

(9.0)
_)
_)
_)

4,161.7
1,873.2
6.5
5.0

(1.0)
8.0)
_)
_)

4,160.7
1,881.2
6.5
5.0

5,626.4

6,055.4

(9.0)

6,046.4

7.0)

6,053.4

Criminal Justice
Municipal Court
Public Defender

374.9
7.6

374.9
7.6

_)
_)

374.9
7.6

_)
_)

374.9
7.6

Total Criminal Justice

382.5

382.5

_)

382.5

_)

382.5

Transportation
Street Transportation
Aviation
Public Transit

762.7
749.7
63.0

764.7
769.7
86.0

_)
_)
_)

764.7
769.7
86.0

_)
25.0)
1.0)

764.7
794.7
87.0

Total Transportation

1,575.4

1,620.4

_)

1,620.4

26.0)

1,646.4

SCHEDULE 8: PERSONNEL SCHEDULE BY DEPARTMENT
Number of Full-Time Equivalent Positions (Continued)

2005-06
Authorized
as of
June 30, 2006

2003-04
Actual

2004-05
Authorized

2004-05
Reductions

2004-05
Authorized
as of
June 30, 2005

400.0
77.9
4.0
235.3
50.0
_
228.0
9.5

459.0
78.9
4.0
225.8
36.0
16.0
234.0
9.5

_)
(3.0)
_)
(88.1)
_)
_)
(2.0)
_)

459.0
75.9
4.0
137.7
36.0
16.0
232.0
9.5

14.0
_
_
_
_
_
_
_

473.0
75.9
4.0
137.7
36.0
16.0
232.0
9.5

1,004.7

1,063.2

(93.1)

970.1

14.0

984.1

1,502.7
383.0
115.5

1,566.4
420.0
115.5

(53.2)
_)
_)

1,513.2
420.0
115.5

15.2
_
_

1,528.4
420.0
115.5

205.4
559.4
5.8
1.0
6.0
12.5
5.0

205.4
569.4
5.8
1.0
6.0
12.5
5.0

_)
(3.0)
_)
_)
_)
_)
_)

205.4
566.4
5.8
1.0
6.0
12.5
5.0

3.0
4.6
_
_
_
_
_

208.4
571.0
5.8
1.0
6.0
12.5
5.0

Total Community Enrichment

2,796.3

2,907.0

(56.2)

2,850.8

22.8

2,873.6

Environmental Services
Water Services
Solid Waste Management
Public Works
Environmental Programs

1,317.1
424.0
497.0
15.0

1,355.1
498.0
502.0
15.0

_)
_)
(1.0)
_)

1,355.1
498.0
501.0
15.0

54.0
23.0
_
_

1,409.1
521.0
501.0
15.0

Total Environmental Services

2,253.1

2,370.1

(1.0)

2,369.1

77.0

2,446.1

14,996.7

15,795.6

(175.3)

15,620.3

149.8

15,770.1

Program

Community Development
Development Services
Planning
Business Customer Service Center
Housing
Community and Economic Development
Downtown Development Office
Neighborhood Services
HOPE VI Project
Total Community Development
Community Enrichment
Parks and Recreation
Library
Golf
Civic Plaza Convention and
Theatrical Facilities
Human Services
Education and Youth
Rio Salado
Historic Preservation
Office of Arts and Culture
International and Sister Cities Program

GRAND TOTAL

2005-06
Net Changes *

*Net changes reflect the combined total of proposed budget reductions, proposed budget additions and new positions associated with opening new facilities.

187

Glossary

Accrual Basis Accounting – The most
commonly used accounting method, which
reports income when earned and expenses
when incurred, as opposed to cash basis
accounting, which reports income when
received and expenses when paid. For the
city's Comprehensive Annual Financial Report
(CAFR), Phoenix recognizes grant revenues
on a modified cash basis. Generally Accepted
Accounting Principles (GAAP) recognizes
grant revenues on an accrual basis.

Base Budget Allowances – Funding for
ongoing expenditures for personnel,
commodities, contractual services and
replacement of existing equipment previously
authorized. The base budget allowance
provides funding to continue previously
authorized services and programs.
Bonds – Debt instruments that require

Appropriation – An authorization granted

repayment of a specified principal amount
on a certain date (maturity date), along with
interest at a stated rate or according to a
formula for determining the interest rate.

by the City Council to make expenditures and
to incur obligations for purposes specified
in the Appropriation Ordinances. Three
appropriation ordinances are adopted each
year: 1) the operating funds ordinance,
2) the capital funds ordinance, and
3) the re-appropriated funds ordinance.

Bond Rating – An evaluation of a bond
issuer's credit quality and perceived ability to
pay the principal and interest on time and in
full. Two agencies regularly review city bonds
and generate bond ratings - Moody's Investors
Service and Standard and Poor's Ratings Group.

Arizona Highway User Revenue (AHUR) –
Various gas tax and vehicle licensing fees
imposed and collected by the state and shared
with cities and towns. This revenue must be
used for street or highway purposes.

Balanced Budget – Arizona law (Title 42
Arizona Revised Statutes) requires the City
Council to annually adopt a balanced budget by
purpose of public expense. State law defines
this balanced budget as “the primary property
tax levy, when added together with all
other available resources, must equal these
expenditures.” Therefore, no General Fund
balances can be budgeted in reserve for
subsequent fiscal years. Instead, an amount
for contingencies (also commonly referred to
as a “rainy day fund”) is included in the budget
each year. The City Charter also requires an
annual balanced budget. The Charter further
requires that “the total of proposed
expenditures shall not exceed the total
of estimated income and fund balances.”

Budget – A plan of financial operation for
a specific time period (the city of Phoenix's
adopted budget is for a fiscal year
July 1 - June 30). The budget contains
the estimated expenditures needed to
continue the city's operations for the
fiscal year and revenues anticipated to
finance them.

Capital Outlay – Items that cost more
than $5,000 and have a useful life of more
than two years.

Capital Project – New facility, technology
system, land acquisition or equipment
acquisition, or improvements to existing
facilities beyond routine maintenance.
Capital projects are included in the Capital
Improvement Program and become fixed assets.
Carryover – Expenditure originally planned for
in the current fiscal year, but because of delays,
is postponed to the following fiscal year.

CDBG – See Community Development
Block Grant
Central Service Cost Allocation –
The method of distributing expenses for
general staff and administrative overhead
to the benefiting activity.

CIP – See Capital Improvement Program
City Connection – Weekly employee
newsletter provided in print and e-mail
containing information about the organization,
news about employees, and personnel and
benefits updates.

Capital Budget – See Capital Improvement
Program

City Manager’s Budget – See Preliminary
Budget

Capital Funds – Resources derived from
issuance of bonds for specific purposes,
related federal project grants and participation
from other agencies used to finance
capital expenditures.

Commodities – Consumable goods such as

Capital Improvement Program (CIP) –
A plan for capital expenditures needed to
maintain and expand the public infrastructure
(for example, roads, sewers, water lines or
parks). It projects these infrastructure
needs for a set number of years and is updated
annually to reflect the latest priorities, cost
estimates or changing financial strategies.
The first year of the adopted Capital
Improvement Program becomes the
Annual Capital Budget.

Community Development Block Grant
(CDBG) – Grant funds allocated by the federal

office supplies, repair and replacement parts,
small tools and fuel, which are not of a
capital nature.

government to the city of Phoenix to use for the
prevention and removal of slum and blight, and
to benefit low- and moderate-income persons.
The city disburses these funds through an
annual application process open to all
nonprofit organizations and city departments.

189

Contingency – An appropriation of funds to
cover unforeseen events that occur during the
fiscal year, such as flood emergencies, federal
mandates, shortfalls in revenue and similar
eventualities.
Contractual Services – Expenditures for
services performed by firms, individuals or
other city departments.

Council-Manager Form of Government –
An organizational structure in which the Mayor
and City Council appoint an independent city
manager to be the chief operating officer of a
local government. In practice, a City Council
sets policies and the city manager is responsible
for implementing those policies effectively
and efficiently.
Court Awards Fund – Revenues provided

Enterprise Funds – Funds that are accounted
for in a manner similar to a private business.
Enterprise funds usually recover their costs
(including depreciation) through user fees.
The city has five such self-supporting funds:
Aviation, Water, Wastewater, Golf and Solid
Waste. In addition, the Civic Plaza fund, which
is primarily supported by earmarked excise
taxes, uses enterprise fund accounting to
provide for the periodic determination
of net income.

Estimate – The most recent prediction of
current year revenue and expenditures.
Estimates are based upon several months of
actual expenditure and revenue information
and are prepared to consider the impact of
unanticipated costs or other economic changes.

by court awards of confiscated property under
both the federal and state organized crime acts.
These funds are used for additional law
enforcement activities in the Police and
Law departments.

Excise Tax Fund – This fund is used to
account for tax revenues ultimately pledged
to pay principal and interest on various debt
obligations. This fund includes local sales taxes,
state-shared sales taxes, state-shared income
taxes and sales tax license fees.

Cycle Time – The amount of time, from the

Expenditures – Refers to current cash

customer’s perspective, it takes to complete
a defined task, process or service.

operating expenses and encumbrances.

Debt Service – Payment of principal and

Limit

interest on an obligation resulting from the
issuance of bonds.

Fire Neighborhood Protection Fund –

of an asset due to general wear and tear
or obsolescence.

Encumbrance – A reservation of funds to cover
purchase orders, contracts or other funding
commitments that are yet to be fulfilled.
The budget basis of accounting considers
an encumbrance to be the equivalent of
an expenditure.

This fund is the Fire portion of a voter-approved
0.1 percent sales tax increase approved by the
voters in October 1993.

Fiscal Year – The city’s charter designates
July 1 to June 30 as the fiscal year.
FTE – See Full-Time Equivalent Position
Full-Time Equivalent Position (FTE) –
A position converted to the decimal equivalent
of a full-time position based on 2,080 hours per
year. For example, a part-time clerk working
for 20 hours per week would be equivalent to
one-half of a full-time position or 0.5 FTE.

Fund – An independent governmental
accounting entity with a self-balancing group
of accounts including assets, liabilities and fund
balance, which record all financial transactions
for specific activities of government functions.

190

GAAP – See Generally Accepted Accounting
Principles
General Obligation Bonds (G.O. Bonds) –
Bonds that require voter approval and finance a
variety of public capital projects such as streets,
buildings, parks and improvements The bonds
are backed by the “full faith and credit” of the
issuing government.
General Funds – Resources derived from taxes
and fees that have unrestricted use, meaning
they are not earmarked for specific purposes.

Generally Accepted Accounting Principles
(GAAP) – Uniform minimum standards
of financial accounting and reporting that
govern the form and content of basic financial
statements. The city's Comprehensive Annual
Financial Report (CAFR) outlines adjustments
needed to convert Phoenix's budget basis of
accounting to a GAAP basis.

GFOA – Government Finance Officers
Expenditure Limit – See State Expenditure

Depreciation – The decline in the value

Fund Balance – As used in the budget, the
excess of resources over expenditures. The
beginning fund balance is the residual funds
brought forward from the previous fiscal year.

Association

Goal – A statement of broad direction, purpose
or intent based on the needs of the community.
A goal is general and timeless; that is, it is not
concerned with a specific achievement in a
given time period.
G. O. Bonds – See General Obligation Bonds
Grant – A contribution by one government unit
or funding source to another. The contribution
is usually made to aid in the support of a
specified function (e.g., library materials or
drug enforcement, but it is sometimes for
general purposes).
HUD – U.S. Department of Housing and Urban
Development
Infrastructure – Facilities that support the
daily life and growth of the city, for example,
roads, water lines, sewers, public buildings,
parks and airports.

Impact Fees – Fees adopted by the City

Ordinance – A formal legislative enactment

Preliminary Budget – A balanced budget

Council in 1987 requiring new development
in the city's outlying planning areas to pay its
proportional share of the costs associated with
providing necessary public infrastructure.

by the City Council. If it is not in conflict with
any higher form of law, such as a state statute
or constitutional provision, it has the full
force and effect of law within the boundaries
of the city.

presented to the City Council by the city
manager (sometimes referred to as the City
Manager's Budget) based upon an earlier Trial
Budget, City Council and community feedback
and/or changing economic forecasts. Any City
Council changes to the Preliminary Budget are
incorporated into the final adopted budget.

Improvement Districts – Special assessment
districts formed by property owners who desire
and are willing to pay for mutually enjoyed
improvements such as streets, sidewalks,
sewers and lighting.

Outstanding Bonds – Bonds not yet retired
through principal and interest payments.
Parks and Preserves Fund – This fund is

to certain city enterprise and federally funded
operations that equals the city property taxes
that would be due on plant and equipment if
these operations were for-profit companies.
This includes the Water, Wastewater, Solid
Waste and Public Housing funds.

used to account for the funds generated by the
0.1 percent increase in the sales tax approved
by voters in 1999. The funds are to be used for
the purchase of state trust lands for the
Sonoran Desert Preserve Open Space, and the
development of regional and neighborhood
parks to enhance community safety and
recreation.

Levy – See Tax Levy

Pay-As-You-Go Capital Projects –

Mandate – Legislation passed by the state or

Capital projects whose funding comes from
day-to-day city operating revenue sources.

In-Lieu Property Taxes – An amount charged

federal government requiring action or provision
of services and/or programs. Examples include
the Americans with Disabilities Act, which
requires actions such as physical facility
improvements and provision of specialized
transportation services.

MBE/WBE – Minority- and Women-Owned
Business Enterprise

Net Direct Debt Ratio – The ratio between
property tax-supported debt service and
secondary assessed valuation. The Net Direct
Debt Ratio is one way to gauge the ability of
a local property tax base to support general
obligation debt service.

Objective – A desired output-oriented
accomplishment that can be measured and
achieved within a given time frame, and
advances the activity and organization toward
a corresponding goal.

Percent for Art – An ordinance that
allocates up to 1 percent of the city's capital
improvement budget to fund public art projects.

Privilege License Tax (PLT) – The city of
Phoenix's local sales tax, made up of more
than 14 general categories.

Privilege License Tax Fees – Includes fees
charged for Privilege License Tax (PLT)
Licenses and the annual fee per apartment unit
on the rental of non-transient lodging. Fees
recover the costs associated with administering
an efficient and equitable system. A PLT license
allows the licensee the privilege to conduct
taxable business activities and to collect and
remit those taxes.
Program – A group of related activities
performed by one or more organizational units.

Personal Services – All costs related to
compensating city employees including
employee benefits costs such as contributions
for retirement, social security, and health and
industrial insurance. It also includes fees paid
to elected officials, jurors, and election judges
and clerks. It does not include fees for
professional or other services.

Property Tax – A levy upon each $100 of
assessed valuation of property within the city
of Phoenix. Arizona has two types of property
taxes. Primary property taxes support the city's
General Fund and secondary property taxes pay
general obligation debt.
Public Safety Enhancement Funds –

Plan Six Agreements – Agreements to provide
funding to accelerate the construction of the
Waddell and Cliff dams, and modification of the
Roosevelt and Stewart dams, for the benefit of
the city of Phoenix. These benefits include
the use of additional unappropriated water,
controlling floods, improving the safety of
existing dams, and providing new and improved
recreational facilities.

Operating Funds – Resources derived
from continuing revenue sources used to
finance ongoing operating expenditures
and “pay-as-you-go” capital projects.

Primary Property Tax – A tax levy that can
be used to support any public expense.

The Public Safety Enhancement Funds are
used to account for a 2.0 percent increment
of the 2.7 percent sales tax on utilities with
franchise agreements. The Police Public Safety
Enhancement Fund is dedicated to Police and
Emergency Management needs and receives
62 percent of the revenues generated.
The Fire Public Safety Enhancement Fund
is dedicated to Fire needs and receives
38 percent of the revenues generated.

PLT – See Privilege License Tax
Police Neighborhood Protection Fund –
This fund is the Police portion of a
voter-approved 0.1 percent sales tax increase
approved by the voters in October 1993.

191

Reappropriated Funds – Funds for contracts
entered in a previous fiscal year but which
are still in progress.
Recoveries – Canceled prior year
encumbrances.

Sports Facilities Fund – A special revenue
fund established to account for revenue raised
from a designated portion of the hotel/motel tax
and tax on short-term motor vehicle rentals.
These funds pay the city's portion of the debt
service and other expenditures related to the
downtown sports arena.

RPTA – Regional Public Transportation
Authority.

Resources – Total amounts available for
appropriation including estimated revenues,
fund transfers and beginning fund balances.

Restricted Funds – See Special Revenue Fund.

State Expenditure Limit – A limitation on
annual expenditures imposed by the Arizona
Constitution as approved by the voters in 1980.
The limitation is based upon a city's actual
1979-80 expenditures adjusted for interim
growth in population and inflation. Certain
expenditures may be exempt by the state
Constitution or by voter action.

Transit 2000 Fund – This fund is used to
account for the 0.4 percent sales tax dedicated
to transit approved by voters on March 14, 2000.
Also included in this fund are fare box
collections and DASH revenues.
Trial Budget – A budget developed in early
spring that presents a proposed balanced
budget for discussion by the City Council and
the community before the city manager submits
his or her Preliminary Budget in late spring.
User Fees or User Charges – A fee paid for a
public service or use of a public facility by the
individual or organization benefiting from
the service.

Salary Savings – Budget savings realized
through employee turnover.

Secondary Property Tax – A tax levy
restricted to the payment of debt service on
bonded debt. The secondary property tax when
combined with the primary property tax levy
produces a total rate of $1.82 per $100 of
assessed valuation.

Self-Insurance – Self-funding of insurance
losses. With the exception of airport operations,
police aircraft operations, and excess general
and automobile liability for losses in excess of
$2 million, the city is self-insured for general
and automobile liability exposures.

192

State-Shared Revenues – Revenues levied
and collected by the state but shared with local
governments as determined by state government
each year. In Arizona, a portion of the state's
sales, income and vehicle license tax revenues
are distributed on the basis of a city's relative
population percentage.
Supplemental – Resources to provide new or
enhanced programs or services over the base
budget allocation.
Tax Levy – The total amount to be raised by
general property taxes for purposes specified
in the Tax Levy Ordinance.

Special Revenue Fund – A fund used to

Technical Review – A detailed line-item review

account for receipts from revenue sources that
have been earmarked for specific activities and
related expenditures. Examples include Arizona
Highway User Revenue (AHUR) funds, which
must be used for street and highway purposes,
and secondary property tax, which is restricted
to general-bonded debt obligations.

of each city department's budget conducted by
the Budget and Research Department.

Zero Base Budgeting – A process for
allocating financial resources that provides
for the comparison and prioritization of
existing and proposed programs and services.
The process includes organizing expenditures
in individual decision packages and priority
ranking all decision packages.