Budget Summary V O L U M E O N E | FY 2025/26 Budget CLERK’S OFFICE LIBRARY AND HUMAN SERVICES WESTWORLD WATER FIRE ATTORNEY’S OFFICE TRANSPORTATION AND STADIUM INFRASTRUCTURE PARKS AND RECREATION AND PRESERVE AUDITOR’S OFFICE CIT Y COUNCIL CONSTITUENT SERVICES AVIATION RAILROAD PARK SERVICES PLANNING AND DEVELOPMENT RELATIONS GOVERNMENT EMERGENCY MANAGEMENT COURT FACILITIES POLICE AND EVENTS TOURISM COMMUNICATIONS INFORMATION TECHNOLOGY SOLID WASTE ECONOMIC HUMAN RESOURCES DEVELOPMENT TREASURER’S OFFICE MANAGER’S OFFICE FLEET Adopted FY 2025/26 Budget City of Scottsdale, Arizona Volume One Budget Summary City Council Lisa Borowsky, Mayor Jan Dubauskas, Vice Mayor Barry Graham Adam Kwasman Kathy Littlefield Maryann McAllen Solange Whitehead Administrative Staff Greg Caton, City Manager Samantha Jordan, Sr. Budget Analyst Sonia Andrews, City Treasurer/CFO Trey Nilles, Sr. Budget Analyst Jeff Walther, Assistant City Manager Linna Zhou, Sr. Budget Analyst Scott Selin, Budget Director Jordan Fraser, Budget Analyst Ana Lía Johnson, Assistant Budget Director JunJun Rose, Budget Analyst Savita Swaroop, Dept. Systems Analyst/Prog. III Maya Kwiedacz, Budget Intern TABLE OF CONTENTS FY 2025/26 Adopted Budget – Volume One Budget Summary About Scottsdale Report to our Community ................................................................................................................................ 1 City Organization ............................................................................................................................................. 4 Scottsdale City Council ................................................................................................................................... 5 Charter Officers ............................................................................................................................................... 7 Financial Overview .......................................................................................................................................... 8 Community Profile ........................................................................................................................................ 11 Demographics ............................................................................................................................................... 13 Overview Executive Summary ....................................................................................................................................... 17 Final Budget Transmittal ............................................................................................................................... 28 Budget Adoption Ordinance .......................................................................................................................... 33 Property Tax Levy Ordinance ........................................................................................................................ 56 Proposed Budget Transmittal ....................................................................................................................... 58 Distinguished Budget Presentation Award ................................................................................................... 62 Budget Development Process ....................................................................................................................... 63 Budget Calendar ............................................................................................................................................ 73 Adopted Comprehensive Financial Policies and Governing Guidance .......................................................... 74 Fund Accounting - Fund Types...................................................................................................................... 92 Budget by Fund Total Budget Overview .................................................................................................................................. 93 Total Appropriation ....................................................................................................................................... 97 General Fund ............................................................................................................................................... 101 Ambulance Service Fund ............................................................................................................................. 131 Special Revenue Funds ............................................................................................................................... 139 Preservation Fund ........................................................................................................................... 141 Park and Preserve Tax Allocation Fund .......................................................................................... 149 Park and Preserve Tax Fund – Park Improvements........................................................................ 155 Park and Preserve Tax Fund – Preserve Maintenance ................................................................... 163 Park and Preserve Tax Fund – Park Maintenance........................................................................... 171 Park and Preserve Tax Fund – Fire Mitigation ............................................................................... 179 Park and Preserve Tax Fund – Police Ranger.......... ....................................................................... 187 TABLE OF CONTENTS Budget by Fund Special Programs Fund................................................................................................................... 195 Stadium Facility Fund ..................................................................................................................... 211 Tourism Development Fund ........................................................................................................... 219 Destination Marketing ................................................................................................................. 222 Non-Destination Marketing ......................................................................................................... 224 Transportation Fund ....................................................................................................................... 226 Debt Service Fund ....................................................................................................................................... 247 Bonded Debt ................................................................................................................................... 255 Debt Service Expense .................................................................................................................... 261 Long-Term Debt Outstanding ......................................................................................................... 263 Enterprise Funds ......................................................................................................................................... 265 Water and Water Reclamation Funds ............................................................................................. 267 Solid Waste Fund ............................................................................................................................ 289 Aviation Fund .................................................................................................................................. 299 Internal Service Funds ................................................................................................................................. 311 Healthcare Self Insurance Fund ..................................................................................................... 313 Fleet Management Fund ................................................................................................................. 323 Fleet Replacement Fund ................................................................................................................. 335 Risk Management Fund .................................................................................................................. 341 PC Replacement Fund .................................................................................................................... 351 Grants & Special Districts Funds Grant Funds .................................................................................................................................... 357 Special Districts Fund ..................................................................................................................... 365 Table of Contents Report To Our Community for Fiscal Year 2024/25 Moving Scottsdale Forward Scottsdale’s passionate professionals work on the frontlines and behind the scenes to provide exceptional customer service. The city’s workforce is spread out in a variety of roles to ensure Scottsdale is a safe place to live, work and play. From public-facing departments, such as fire, police, and human services, to departments like human resources, fleet management and information technology; all are critical in running the city. 5:50 minutes average police response time. 5:23 minutes average fire response time. Fire Department public education and outreach connected with 40,000 people. 373 volunteers Scottsdale libraries welcomed more with Vista del than 684,000 Camino & Paiute neighborhood centers. visitors. Scottsdale’s 24,694 food boxes provided McDowell Sonoran Preserve had at senior and community centers. 1,139,520 visits. Resources and Expenses Scottsdale is required by law to adopt a budget each year and cannot spend more than the total budgeted amount. This includes all city funds for the fiscal year ending June 30. City Council adopted the Fiscal Year 2025/26 budget in June 2025. Learn more at ScottsdaleAZ.gov, search “get involved” 2024/25 2025/26 BUDGET BUDGET $1,261.5 $1,195.1 2024/25 BUDGET $761.7 Taxes and Service Charges are collected to support city services and pay for debt service. 2025/26 BUDGET $885.2 Operating Budget pays for city services and the employees that provide those services. $1,068.4 $1,295.0 $1,393.6 $947.7 Fund Balances consist of accumulated surpluses from prior years held in contingency and reserve. $464.7 Total Resources Available $2,556.5 $2,588.7 Resources (in millions of dollars) $2,294.8 Capital Budget is used for major facilities and infrastructure, including roads. $370.8 Contingency & Reserves are set aside for emergency use. $2,203.7 Maximum Expenditure Limit Expenses (in millions of dollars) 1 Table of Contents Spotlighting Our Departments Highlighted Accomplishments Parks and Recreation and Preserve achieved national accreditation from the Commission for Accreditation of Park and Recreation Agencies, maintaining its distinction as the longestaccredited agency in Arizona and one of the top five in the nation. The Scottsdale Fire Department Regional Training Center opened in 2025, hosting its inaugural class in January. This state-of-the-art facility enhances the department’s training capabilities and offers a centralized location equipped with advanced resources and technology. The McDowell Sonoran Preserve had its grand opening of the Brown’s Ranch Interpretive Trail, highlighting ranching in the early 1900s through the eyes of the Brown’s family to present day Scottsdale. New Regional Training Center The Office of Emergency Management completed the 2025 Scottsdale Emergency Operations Plan, enhancing the city’s ability to prioritize critical services and resources during emergencies. Brown’s Ranch From potholes to mediation services, Constituent Services allows residents to submit digital requests 24/7. In March 2025, the Scottsdale Food Bank expanded from Vista del Camino Community Center to a new warehouse location at 7601 E. McKellips Road. In FY 2024/25, the food bank: Donated and rescued 536,423 pounds of food Provided assistance to community members valued at $1,244,547 4,250 Volunteer hours Expanded Food Bank on McKellips 2 SPD at Barrett Jackson The Hontz Training Facility expansion was completed for the Scottsdale Police Department, delivering upgraded firing ranges, classrooms and equipment storage to support officer development and longterm readiness. Table of Contents Highlighted Accomplishments Scottsdale Airport was awarded the 2025 Airport Business of the Year for the construction of NetJet’s new executive terminal, large aircraft storage and maintenance hangar. Scottsdale Airport Scottsdale Stadium completed construction of a revitalized Left Field Berm in February 2025 and opened the Left Field Day Park in April. The park provides a unique opportunity for constituents and visitors of Old Town to soak in the sights and sounds of the ballpark. Reporting issues is EZ The Fleet Maintenance Department closed 8,832 vehicle repair orders, 97% of which were completed and available the very same day. Fleet Maintenance Department The city’s Economic Development Department was one of 86 organizations accredited by the International Economic Development Council. Scottsdale Stadium The Facilities Management Department replaced the emergency generator for the Police Department District 3. The Information Technology Department and City Treasurer’s Office implemented a new, modern citywide enterprise financial platform that streamlines how Scottsdale manages its accounting, budgeting, procurement and financial reporting, enhancing efficiency and transparency. Scottsdale’s Transportation and Infrastructure Department completed the Indian Bend Wash Underpass at Chaparral Road, improving safety and connectivity for pedestrians and bicyclists. Chaparral Road Underpass Residents made 54,879 requests using Scottsdale EZ last year. The number one request? Electric scooters. Have concerns about electric scooters or other issues? Report it at ScottsdaleAZ.gov, search “EZ”. 3 Table of Contents City Organization for Fiscal Year 2025/26 Meet Our Leadership Vertical The voter-approved City Charter established the council-manager form of government which combines the strong political leadership of elected officials with the professional experience of an appointed local government manager. People of Scottsdale Learn more at ScottsdaleAZ.gov, search “about” Mayor & City Council Citizen Advisory Groups BOARDS AND COMMISSIONS CITY TREASURER Accounting Budget Business Services Purchasing City Attorney Presiding Judge CITY COURT Scottsdale has 22 boards and commissions. For more info, go to ScottsdaleAZ.gov/boards City Treasurer / CFO Charter Officers City Manager Assistant City Manager Police Chief City Departments CITY MANAGER’S OFFICE Constituent Services Emergency Management Government Relations FLEET MANAGEMENT COMMUNICATIONS INFORMATION TECHNOLOGY ENTERPRISE OPERATIONS Aviation Economic Development McCormick-Stillman Railroad Park Stadium Tourism and Events WestWorld PARKS AND RECREATION AND PRESERVE FACILITIES MANAGEMENT 4 HUMAN RESOURCES LIBRARY AND HUMAN SERVICES PLANNING AND DEVELOPMENT SOLID WASTE TRANSPORTATION AND INFRASTRUCTURE WATER RESOURCES City Auditor City Clerk Executive Leadership Fire Chief CITY ATTORNEY Civil Prosecution Risk Management Victim Services CITY AUDITOR CITY CLERK Council Support Election Services Records Management POLICE Uniformed Services Investigative Services Operational Services FIRE Operations Services Professional Services Fire and Life Safety Table of Contents Scottsdale City Council The City Council consists of the mayor and six council members who are elected to represent the city at large and serve overlapping, four-year terms. These seven citizens oversee city government and set policies, approve programs, appropriate funds, enact laws, select charter officers and appoint residents to serve on advisory board. The mayor serves as the chair of the Scottsdale City Council and presides over its meetings, which are typically held on Tuesdays in the City Hall Kiva Forum located at 3939 N. Drinkwater Blvd. in Old Town Scottsdale. Lisa Borowsky began her first term as mayor of Scottsdale in January 2025. She is a lifelong Scottsdale resident and is dedicated to keeping Scottsdale a worldrenowned tourist destination while prioritizing a community that residents are proud to call home. Lisa attended Scottsdale public schools, obtained her undergraduate degree from Arizona State University and her J.D. at St. John’s University School of Law in New York. She returned home to begin her career in commercial litigation. Throughout her legal career, Lisa represented homeowners plagued by construction failures, recovering millions of dollars on their behalf. Mayor Lisa Borowsky Lisa’s most important accomplishment, however, is raising her daughter here in Scottsdale. They enjoy spending time with their family, dogs and horses and playing tennis. Lisa served on the Scottsdale City Council from 2008 to 2012, leading efforts for meaningful structural changes to the city budget process and securing a voter-approved amendment to the City Charter to strengthen fiscal accountability to taxpayers. She grew up competing in quarter horse shows and still enjoys riding and spending time at Scottsdale’s great restaurants, resorts and events. She loves meeting and hearing from residents. Please reach out with ideas, concerns or to become a city volunteer. MBorowsky@ScottsdaleAZ.gov | 480-312-2433 Jan Dubauskas began her term on the Scottsdale City Council in January 2025. Barry Graham began serving on the Scottsdale City Council in January 2023. She has lived in Arizona since 1998 and been a Scottsdale resident for more than 10 years. A Scottsdale native and Chaparral High School allstate athlete, Barry now lives in southern Scottsdale with his wife and their twin sons. He is a Certified Public Accountant with expertise in auditing and financial performance analysis for Arizona-based businesses. Jan has been practicing law for nearly 20 years. She served as general counsel and chief operating officer for a health Councilwoman insurance carrier and regularly Jan Dubauskas appeared on national cable news as a health insurance expert. Prior to that, she served as director of compliance for a life insurance company. Jan has a bachelor’s degree from the University of Oregon and a J.D. from Arizona State University’s Sandra Day O’Connor College of Law. She is a graduate of Scottsdale 101 Citizen Academy and the city’s police and water citizen academies. Jan and her husband have a blended family with five children ranging in age from 7-27. Their youngest daughters attend school in the Scottsdale Unified School District. JDubauskas@ScottsdaleAZ.gov | 480-312-7402 Councilman Barry Graham Barry has long been active in the community—he is a Scottsdale Leadership graduate, former planning commissioner, and past chairman of both the Transportation Commission and Building Advisory Board of Appeals. A proud Scottsdale Fire Citizens’ Academy alum, Barry also led the successful 2015 “Yes to Bonds” campaign that improved local public safety infrastructure. Barry holds degrees in economics and international relations from Boston University and a master’s in accounting from the University of Massachusetts, where he delivered the commencement address. He has served as a precinct committeeman since 2012 and twice as treasurer of his local legislative district. BGraham@scottsdaleaz.gov | 480-312-7454 5 Table of Contents Adam Kwasman began his first term on the Scottsdale City Council in January 2025. Kathy Littlefield began her third term on the Scottsdale City Council in January 2023. He serves as the president and managing attorney of Kwasman Law. A Scottsdale native and Arizona State University graduate, she brings over 25 years of financial and management experience to the role. She co-founded and manages NetXpert Systems, Councilwoman Inc., a successful ScottsdaleKathy Littlefield based computer company. Her professional background includes work in the City of Plano’s Budget Office and several Scottsdale businesses and nonprofits. Adam previously served in the Arizona House of Representatives where he was vice chairman of the Ways & Councilman Means committee and sat on Adam Kwasman the Appropriations, Commerce and Joint-Legislative Budget committees. He earned the “Hero of the Taxpayer” award from Americans for Prosperity, the “Champion of Small Business” award by the National Federation of Independent Businesses, and the “Friend of the Family Award” by the Arizona Family Project. Adam earned his bachelor’s degree (cum laude) from Tulane University, his Master of Arts in Economics from George Mason University, and his J.D. from Arizona State University’s Sandra Day O’Connor College of Law. He draws inspiration from his wife and their four children. The Kwasmans are members of Congregation Beth Tefillah and Chabad of Arizona. AKwasman@SwcottsdaleAZ.gov | 480-312-2374 Councilwoman Littlefield has long been active in civic life, serving in leadership roles with the Civitan Club, Special Olympics, North Scottsdale Little League, and her local legislative district. She’s a proud member of the Daughters of the American Revolution and the Mayflower Society. Deeply committed to her community, she has supported youth programs and veterans’ initiatives throughout her career. She and her husband, former Councilman Bob Littlefield, have been married over 46 years and have two children and one grandchild. KLittlefield@ScottsdaleAZ.gov | 480-312-7412 Maryann McAllen began her first term on the Scottsdale City Council in January 2025. Solange Whitehead began her second term on the Scottsdale City Council in January 2023. Becoming a city councilwoman has been a lifelong goal for Maryann who dreamed of serving her community since she was a student at Supai Elementary School. An electrical engineer, businesswoman, and conservationist, she moved to Scottsdale in 1996 and quickly made it home. Councilwoman Whitehead is committed to community-first Councilwoman policymaking, bringing diverse Solange Whitehead stakeholders together to find solutions that protect public health, enhance quality of life, and use tax dollars wisely. She is known for her hands-on approach, regularly engaging with residents, businesses, and neighborhoods across Scottsdale. Maryann has lived in Scottsdale for 60 years. She attended Coronado High School and is now the president of the Coronado Foundation for the Future, which funds scholarships for current students. Councilwoman Maryann McAllen She earned a bachelor’s degree in communication and nonprofit studies from Arizona State University. After graduation, she began a 14-year career in the city’s Parks and Recreation and Human Services departments. Maryann has been married to her husband for 32 years. They raised their four children in Scottsdale. Maryann is a graduate of Scottdale Leadership and the past chair of the Scottsdale Parks and Recreation Commission. A former preserve commissioner and “Conservationist of the Year” honoree, she helped pass the Protect Our Preserve initiative and supports sustainability through policy and action. She serves on the board of Waste Not, volunteers at the Granite Reef Senior Center, and championed the 3D printer lab at Scottsdale Community College. She is also a proud small business owner in Scottsdale. Councilwoman Whitehead and her husband have three grown children and enjoy spending time outdoors. MMcallen@ScottsdaleAZ.gov | 480-312-7456 SWhitehead@ScottsdaleAZ.gov | 480-312-7423 6 Table of Contents Charter Officers The City Council hires six officers to advise them on policy issues and run day-to-day operations. They are collectively known as the charter officers because their positions are spelled out in the City Charter, a voter-approved document which describes the organization and authority of the city government in Scottsdale. These positions are the city manager, city attorney, city auditor, city clerk, city treasurer/chief financial officer and presiding city judge. The city manager is the chief executive officer and is responsible for about 90 percent of the city’s workforce. Greg Caton City Manager GCaton@ScottsdaleAZ.gov 480-312-7759 Ben Lane City Clerk BLane@ScottsdaleAZ.gov 480-312-2411 Luis Santaella Interim City Attorney LSantaella@ScottsdaleAZ.gov 480-312-7771 Sonia Andrews City Treasurer & Chief Financial Officer SAndrews@ScottsdaleAZ.gov 480-312-2364 Lai Cluff Acting City Auditor LCluff@ScottsdaleAZ.gov 480-312-7851 Marianne Bayardi Presiding Judge MBayardi@ScottsdaleAZ.gov 480-312-7604 Awards and Recognitions •S  cottsdale Airport received the FAA Western-Pacific Region Outstanding Airport Award, showcasing excellence in operations, safety and community engagement. •S  cottsdale’s Accounting Division earned its 51st consecutive Certificate of Achievement in Financial Reporting from the Government Finance Officers’ Association, a testament to the city’s transparent and comprehensive annual reports. •S  cottsdale’s Short-Term Rental Resource Center received a 2025 CIO 100 Award, reflecting the city’s continued innovation and commitment to addressing community concerns. The Resource Center integrates advanced AI and machine learning technology, strengthening cross-departmental collaboration and exceptional service delivery. •S  cottsdale’s Procurement Division earned the prestigious 2025 Achievement of Excellence in Procurement® Award from the National Procurement Institute. Find more recognitions and rankings at ScottsdaleAZ.gov, search “recognition and rankings” 7 Table of Contents Financial Overview for Fiscal Year 2025/26 Making Cents of Numbers The City of Scottsdale implements the priorities of residents through funding programs and services. The budget is the highest form of policy approved by the City Council and is presented in multiple formats to accommodate a variety of audiences. The city invites Scottsdale residents to provide input annually throughout the budget development and adoption. Community Feedback September - January April Prepare Propose Departments work to forecast and refine budget requests Proposed budget is presented to City Council May June Review & Adopt Adopt City Council sets the rates and fees for the fiscal year. Residents can provide their thoughts City Council adopts the final budget. Residents can provide their thoughts Adopted Budget (all funds) Scottsdale’s budget is balanced as the city has more resources available than it is using Total Resources $2,588.7 (in millions of dollars) * Total Uses $2,203.7 (in millions of dollars) Difference between resources and uses is allocated to the city’s contingencies and reserves. Scottsdale’s Budgets Scottsdale’s annual budget includes two main components, one is for capital projects that become long-time assets and the other is for city operations, which fund services for the public. Capital Budget Operating Budget Funds long-term investments in the city such as building, acquisition and improvement of infrastructure and facilities. Funds the day-to-day operations and services of the city. Top Uses of Funds FY 2025/26 Budget $974.2 (in millions of dollars) Water Management $331.3 Transportation and $261.8 Infrastructure Service Facilities $159.1 All other uses of funds: $222.0 8 FY 2025/26 Budget $1,229.5 (in millions of dollars) Top Uses of Funds Police $210.4 Water Resources $119.5 Fire $93.3 All other uses of funds: $806.3 Table of Contents Where Do My Property Taxes Go? Total: $75 million SCHOOLS/EDUCATION MARICOPA COUNTY 56% * 19% SPECIAL DISTRICTS 10% CITY PRIMARY TAX CITY SECONDARY TAX 8% 7% Some property tax numbers may vary based on location in Scottsdale Scottsdale has one of the lowest property and sales tax rates in the Valley. Property tax on a $400,000 house Sales tax on a $40,000 car $343 $369 $564 $984 MESA SCOTTSDALE AVERAGE * TEMPE $600 $680 $825 $1,160 CHANDLER SCOTTSDALE AVERAGE * GLENDALE *Average of the eight largest cities in the Valley. The housing figures are reflective of the assessed value. Where Do My Sales Taxes Go? City of Scottsdale Sales Tax 1.7% County Sales Tax 0.7% Understanding Scottsdale’s Sales Taxes • General Fund (1.00%) - Available for any municipal purpose. • Public Safety (0.10%) - Dedicated exclusively to public safety. • Transportation (0.30%) - Dedicated to transportation improvements and approved by voters in 1989 (0.20%) and 2018 (0.10%). State Sales Tax 5.6% • Preserve (0.15%) - Dedicated to the purchase of land within the McDowell Sonoran Preserve and approved by voters in 2004. • Parks and Preserve (0.15%) - Dedicated to parks and recreational facilities and maintenance and protection of the McDowell Sonoran Preserve and approved by voters in 2024. Total: 8.0% 9 Table of Contents Simply Better Service for Fiscal Year 2025/26 Table of Contents Community Profile for Fiscal Year 2025/26 Welcome to Scottsdale, Arizona A World-Class Community Scottsdale is a premier community nestled at the foot of the McDowell Mountains in the Valley of the Sun. Residents enjoy a high quality of life with attractive residential, recreational and shopping areas in a city that has earned its enviable reputation as an internationally recognized visitor destination and a thriving location for businesses of all kinds. Scottsdale consistently ranks among the nation’s best places to live, with top-rated schools, award-winning parks, low crime rates and a vibrant economy. Old Town Scottsdale is home to many restaurants, retail shops, art galleries and resort hotels. Scottsdale’s McDowell Sonoran Preserve is a permanently protected Sonoran Desert habitat encompassing nearly 48 square miles. There are recreational opportunities for everyone with many golf courses, tennis and pickleball courts, parks, pools and hundreds of miles of bike paths and trails. Scottsdale was founded by Army Chaplain Winfield Scott in 1888 but was not incorporated until 1951 when Scottsdale was a small community of 2,021 residents situated on about two square miles of land. Today, Scottsdale is home to more than 246,000 residents enjoying the rich diversity of experiences offered within the city’s 185 square miles. Scottsdale Public Library’s Ultimate Play Date Dia De Los Muertos Western Week – End of Trail Scottsdale Veteran’s Day 11 Table of Contents Scottsdale Top Attractions Pinnacle Peak Park Preserve Gateway and Scottsdale’s  McDowell Sonoran Preserve TPC Scottsdale WestWorld 1 Scottsdale Airport/Airpark McCormick-Stillman Railroad Park 2 3 4 5 Indian Bend Wash Greenbelt Scottsdale Fashion Square 6 11 12 Scottsdale Waterfront Civic Center Scottsdale’s Museum of the West Scottsdale Stadium 8 9 10 12 7 Table of Contents Demographics for Fiscal Year 2025/26 Scottsdale by the Numbers: A Demographic Summary Source: U.S. Census Quickfacts 1951 2,021 1960 10,026 1970 67,841 1980 88,364 Scottsdale is the 48th largest city in the U.S. by area. U.S. Census Bureau Quickfacts and City of Scottsdale 1990 130,069 2000 202,705 2010 217,365 2021 242,753 2022 2023 243,050 244,394 2024 246,170 Over 7,800 people directly serve the residents of Scottsdale. Source: U.S. Census Bureau Quickfacts and City of Scottsdale 6 Appointed Charter Officers 6 Council Members 169 Board & Commission Members SCOTTSDALE’S 246,170 1 Mayor RESIDENTS ARE SERVED BY 2,818 Employees 31 miles long 4,836 184.5 square miles Volunteers Scottsdale’s elevation rises by nearly 4,000 feet from south to north. Source: National Weather Service 1,510 ft 1,150 ft Lowest point 11.4 miles wide 83° 56° 99° 68° 101° 77° 114° 92° 4,877 ft Highest Point (Butte Peak) Scottsdale Airport Change in Elevation 13 Table of Contents Scottsdale Residents Scottsdale’s median age of 49.8 is more than 10 years older than the U.S. median age of 38.4. Median Age (US): 38.4 | Median Age (Scottsdale): 49.8 <5 9,983 5–19 28,119 20–24 13,929 55–74 58,582 25–54 87,198 Scottsdale Population by Race and Ethnicity 75+ 29,982 While most Scottsdale residents speak English, 1 in 5 can also speak another language. Spanish 81.9% White* 9.4% Hispanic or Latino 11,735 (5.0%) 8% Indo-European languages English and another language Two or more races* 9,139 (3.9%) 28,638 (12.2%) Asian and Pacific Islander languages 5,894 (2.5%) 5.1% 2% 0.1% Other languages English only 205,320 (87.8%) Asian* African-American* Native-American* *Non-Hispanic or Latino 3 in 5 Scottsdale residents over age 25 have earned a bachelor’s degree or higher. 4,411 (.02%) Less than High School Graduate 22,946 (12%) High School Graduate 14 47,918 (25%) Associate Degree/ Some College 117,115 (61%) Bachelor’s Degree or higher 1,870 (0.8%) Table of Contents 7,451 Healthcare and finance firms lead the list of top employers. employees Source: City of Scottsdale Economic Development Department (2025) 3,073 employees 2,818 employees 2,557 employees 2,475 employees 1,752 employees City of Scottsdale Full-time Employees and Their Funding Sources 1,559 employees 1,413 employees 1,250 employees 1,134 employees More people come to work in Scottsdale each day than leave to work in other communities. Source: U.S. Census Inflow/Outflow Analysis Scottsdale businesses and organizations have 211,885 employees Non-Public Safety 1,040 (37.2%) General Fund 31,777 work/live in Scottsdale 180,108 workers enter Public Safety 1,088 (38.9%) Aviation 15 (0.5%) Enterprise Funds* Other Funds Solid Waste 106 (3.8%) Water 251 (9%) 296 (10.6%) *An Enterprise Fund operates similarly to a private business. Instead of taxes, revenues are generated from user fees or charges which cover all operating and capital expenses. 79,996 work elsewhere To view additional demographic information, visit ScottsdaleAZ.gov and search “about” Note: Total population is determined by the Decennial Census. Demographic numbers are based on five-year estimates. 15 Table of Contents FY 2025/26 Adopted Budget 16 Table of Contents OVERVIEW | Executive Summary EXECUTIVE SUMMARY The City of Scottsdale’s three budget volumes provide a comprehensive picture of the city’s financial plan for FY 2025/26. This Executive Summary complements that information highlighting items, issues and trends that shaped the budget. The adopted FY 2025/26 budget anticipates a decline in sales tax revenues compared to FY 2024/25, with gradual revenue growth occurring over the upcoming five years. Scottsdale’s economy and tourism activities remain strong, however future economic conditions remain uncertain. Scottsdale will continue to ensure that the split between ongoing sustainable revenues and one-time revenues is appropriate. The adopted FY 2025/26 budget is $2.2 billion and represents an overall decrease of 4.0% from the FY 2024/25 budget. CITY COUNCIL POLICY DECISIONS The following are the major policy items included in the city’s adopted FY 2025/26 budget: • $4.5 million General Fund for staffing for Phase II of the city’s Ambulance Service. • $1.5 million to staff a second fire truck for Station 601. • $50.0 million General Fund for a one-time paydown of Public Safety Personnel Retirement System (PSPRS) pension liability. • $5.3 million for salary adjustments to align Police pay to the market. • $12.5 million for merit and market adjustments for employees. • $25.2 million in revenue from the newly-established 0.15% Park and Preserve sales tax, which was approved in November 2024 by voters. STAFFING CHANGES The city’s total FTE count for FY 2025/26 is 2,796.90 which is a net increase of 96.45 FTE from the FY 2024/25 adopted budget. There was a reduction of 1.71 FTE positions during FY 2024/25 after the budget was adopted and a total of 98.16 positions were added in the FY 2025/26 budget. The positions that were added in the FY 2025/26 budget were spread across departments with identified needs, including the following: 17 Table of Contents OVERVIEW | Executive Summary • Fire Department: An increase of 44.0 FTE positions to provide staffing for Phase II of the ambulance service, to restaff a fire truck for Fire Station 601, and to begin implementation of the new 0.15% Park and Preserve Tax. Police Department: An increase of 22.0 FTE positions to add School Resource Officers, provide additional staffing in the Real Time Crime Center (RTCC), support the Criminal Intelligence Unit, provide support for records and evidence personnel, and to begin implementation of the new 0.15% Park and Preserve Tax. • Parks and Recreation and Preserve: An increase of 9.01 FTE positions to begin implementation of the new 0.15% Park and Preserve tax, expand programming, and to reflect a change in city reporting structure. • Transportation and Infrastructure: An increase of 7.25 FTE positions to bolster project management capabilities, provide necessary technical expertise and to reflect a change in city reporting structure. All staffing changes are summarized in the Summary of FTE Changes Appendix that follows this Executive Summary. HOW THE ADOPTED BUDGET WILL AFFECT CITIZENS’ PROPERTY TAX RATES The FY 2025/26 primary property tax levy will be used to support General Fund activities such as police and fire protection, operation and maintenance of parks and libraries, and other general governmental functions. The primary property tax levy also includes a repayment to the Risk Management Fund reserve of $0.7 million for tort liability claim payments made during calendar year 2024. For FY 2025/26, the city’s total primary property tax levy of $40.3 million is an increase of $0.6 million over the FY 2024/25 levy of $39.6 million. The FY 2024/25 primary property tax rate of $0.4958 per $100 of assessed valuation will decrease by $0.0067 to $0.4891 in FY 2025/26. For FY 2024/25, the city’s secondary property tax levy will increase by $0.1 million from the FY 2024/25 adopted budget of $34.8 million to $34.9 million. The FY 2024/25 secondary tax rate of $0.4358 will decrease by $0.0125 to $0.4233 per $100 of assessed valuation in FY 2025/26. The combined tax levy is the aggregate of the primary and secondary levies. For FY 2025/26, the city’s total combined property tax levy decreased by approximately $0.6 million from $74.5 million in FY 2024/25 to $75.1 million in FY 2025/26. In FY 2025/26, citizen tax bills will reflect a combined property tax rate of $0.9124, which is $0.0192 less than the FY 2024/25 combined rate of $0.9316. The management of the combined property tax rate is included in the city’s adopted financial policies for debt management, which states that the combined tax rate will not exceed $1.50 per $100 of assessed value. Based on this combined rate, an owner of a home with a County Assessor’s real property assessed value of $100,000 will pay approximately $91.24 in city property taxes, applying the combined property tax rate. The Maricopa County Assessor’s Office, not the City of Scottsdale, determines real property assessed values used to calculate property tax bills. FUND HIGHLIGHTS The remainder of this Executive Summary highlights the key elements of each fund in the FY 2025/26 budget. The General Fund is presented first and in more detail because of its size and importance. GENERAL FUND – SOURCES The General Fund supports core services and is the largest fund with the greatest potential for revenue fluctuations. Forecasted General Fund sources for FY 2025/26 are $441.8 million, approximately $7.0 million more than the FY 2024/25 adopted budget. The following bar graph summarizes the major sources. 18 Table of Contents OVERVIEW | Executive Summary Note: Rounding differences may occur That total projected increase comes from a net of several different sources. Below highlights the sources contributing significantly to the change as compared to the FY 2024/25 adopted budget: • $5.2 million from a projected slight increase in anticipated general fund sales tax collections. • $0.2 million from projected Electric & Gas Franchise collections explained by higher electric usage and rates. • $4.0 million net reduction from the city’s proportionate slices of state shared income tax, sales tax, and vehicle license fees mostly due to the impact of a State imposed flat tax policy. • $2.0 million from increased Building Permit Fees & Charges to help cover inflationary costs and department operating costs to provide an excellent customer experience. • $3.1 million for charges for services including WestWorld Equestrian Facility Fees based on anticipated events and establishing a more appropriate cost recovery formula used when developing WestWorld fees, intergovernmental revenue due to higher collections from the fire insurance premium tax, property rental, and other miscellaneous charges for service. • $4.5 million net reduction from interest earnings, due to anticipated spenddown of reserves. GENERAL FUND – USES The adopted FY 2025/26 General Fund uses budget is projected to be approximately $521.1 million (not including contingency, reserves, and designations). The following bar graph provides a summary of the General Fund uses. 19 Table of Contents OVERVIEW | Executive Summary Note: Rounding differences may occur Scottsdale is a people-powered service provider. As such, most expenses are related to funding for our high-performance workforce and providing pay and benefit packages that allow the city to retain and recruit employees. Significant personnel expenditures included in the adopted operating budget include: • $50.0 million General Fund for a one-time paydown of the PSPRS liability. This contribution will result in lower retirement contribution rates in future years. • $2.3 million General Fund for the citywide pay for performance program to eligible employees. • $5.0 million General Fund for the citywide market adjustment. • $4.7 million General Fund for personnel programs, which includes citywide pay programs, leave accrual, parental leave and vacation trade. While high quality staff are the engine that drives our organization, the proposed General Fund budget also includes money for these priority projects and programs across the city’s operating and administrative departments: City Attorney: • $0.1 million to reclassify a temp worker to part-time. City Clerk: • $0.6 million in one-time funding for a possible special election. City Court: • $0.1 million to move a Deputy Court Administrator position to the General Fund from the Special Revenue Fund. City Treasurer: • $0.3 million for software licensing needs. Communication: • $0.2 million for the ADA Transition Plan. 20 Table of Contents OVERVIEW | Executive Summary Parks and Recreation and Preserve: • $0.2 million for the city’s mowing contract. • $0.2 million for Leisure Education professional services. Planning: • $0.6 million for the annual subscription fees for planning software. Fire Department: • $4.5 million to launch Phase II of the city’s ambulance service. • $1.5 million to restaff a fire truck at Station 601. • $0.5 million for the Fire Warehouse lease agreement. • $0.4 million for fleet vehicle upfitting. • $0.4 million for ballistic panel replacement. Police Department: • $5.3 million for salary adjustments to align Police pay to the market. • $0.8 million to expand the Drone as First Responder Program within the Real Time Crime Center (RTCC). • $0.5 million to match patrol fleet vehicles to service needs. • $0.4 million for the city’s municipal security contract. • $0.3 million for the automated license plate reader program. GENERAL FUND ENDING BALANCE The FY 2025/26 budget includes the following: Emergency and Operating Reserve – The Emergency Reserve was implemented in FY 2022/23, and complies with Financial Policy No. 2.02. The policy states that the General Fund will maintain five percent of operating uses, excluding transfers out as an emergency reserve to cover for unexpected emergencies and events where immediate action must be taken in the best interest of the city's residents and business owners. The Operating Reserve complies with Financial Policy No.2.01. The policy states the General Fund will maintain an operating reserve of 20 percent of General Fund operating uses, excluding transfers out, which beginning in FY 2022/23 is an increase from 10 percent to incorporate best financial practices. The Operating Reserve is to only be used for unforeseen emergencies or catastrophic impacts to the city. Maintaining a sufficient General Fund Reserve level is financially prudent. The FY 2025/26 Emergency and Operating Reserve is $115.0 million. Operating Contingency – Operating Contingency for FY 2025/26 is $15.4 million of budget authorization if unforeseen expenses occur during the fiscal year. Contingency funds are utilized only after all budget options have been considered and require City Council approval. PSPRS Pension Liabilities – Public Safety Personnel Retirement System (PSPRS) is an Arizona pension system for public safety personnel. The FY 2025/26 PSPRS Pension Liabilities fund balance designation is $26.7 million. Development Agreements – Designation created in FY 2019/20 for eligible infrastructure reimbursements. The FY 2025/26 fund balance designation is $16.2 million. 21 Table of Contents OVERVIEW | Executive Summary Facilities Repair/Replacement Reserve – Designation created to refer to contingency or reserve funds set aside specifically for the repair or replacement of city facilities. These funds are used only after all alternative budget funding sources have been fully considered. The FY 2025/26 Facilities Repair/Replacement Reserve is $10.0 million. Revenue Loss Reserve – Revenue Loss Reserve is a contingency established to offset unexpected decreases in revenue and are used when additional funds are needed to maintain service levels due to unforeseen revenue shortfalls, unanticipated grants or inadequately budgeted events that threaten public health or safety. The FY 2025/26 Revenue Loss Reserve is $15.0 million. General Fund Balance – General Fund Balance accounts for any funds remaining after the designation of all other reserves/uses. The FY 2025/26 ending fund balance is $0.5 million. Under prudent fiscal management practices, this balance should most appropriately be used for one-time expenditures, not to fund new or to expand programs with ongoing operating expenses. SPECIAL REVENUE FUNDS The city accounts for sources dedicated for specific purposes – by law or city policy – through Special Revenue Funds. There are six Special Revenue Funds – Transportation Fund, Preservation Fund, Park and Preserve Tax Fund, Special Programs Fund, Tourism Development Fund, and the Stadium Facility Fund. The Transportation Fund accounts for Highway User Revenue Fund (HURF) dollars shared with cities from state gas taxes. However, the majority of the funding for the Transportation Fund comes from the 1990 (0.20 percent) voter-approved sales tax, and partially from the state’s Local Transportation Assistance Fund, which is funded from lottery proceeds, and it is distributed to cities and towns through an annual application process. Total sources are expected to be about $56.9 million in FY 2025/26. Uses total about $61.5 million in FY 2025/26, of which $37.1 million represents operating expenses. The operating expenses from the Transportation are those necessary to operate and maintain the city’s transportation system. The largest expenses include transit contracts, trolley maintenance, medians and rights-of-way maintenance and the street overlay program. $24.4 million will be transferred to the Capital Improvement Plan to comply with the city’s adopted Financial; Policies regarding the use of the 1990 transportation sales tax and for pay-as-you-go transfers above the 50 percent level authorized by the City Council. The Preservation Fund is used to account for sources and uses related to the acquisition of land for the Scottsdale McDowell Sonoran Preserve. Funding comes from the 1995 (0.20 percent) and 2004 (0.15 percent) voter-approved sales tax. Under the sales tax ballot language, the preservation sales tax revenues are to be used only for Preserve acquisition, preserve related construction and trailheads. These sales tax revenues are forecasted to be $29.7 million in FY 2025/26. Approximately $26.4 million will be required for debt service payments for debt already issued for land purchases. The ending fund balance on June 30, 2026, is expected to be $151.4 million. The Park and Preserve Tax Fund accounts for sources and uses related to the voter approved Proposition 490, which assesses a 0.15 percent transaction privilege and use tax for maintenance and improvement of city parks and for the maintenance and protection of the McDowell Sonoran Preserve. Total sources are expected to be about $25.2 million in FY 2025/26. Revenues received into this fund will be transferred to a variety of funds per Ordinance 4633, after debt requirements are satisfied. The allocation of these revenues will be as follows: • • • • • Park Improvements Fund – 51 percent Preserve Maintenance Fund – 18 percent Park Maintenance Fund – 14 percent Fire Mitigation Fund – 10 percent Police Ranger Fund – 7 percent The Special Programs Fund is a collection of smaller restricted sources dedicated to specific uses. The services included in these various programs are intended to be self-supporting and not subsidized by the General Fund. Examples of these funds include Police Department Racketeering Influenced Corrupt Organization (RICO) funds, the City Court’s Court Enhancement Funds (CEF), and the McCormick-Stillman Railroad Park funds. 22 Table of Contents OVERVIEW | Executive Summary The Tourism Development Fund is a special revenue fund created to account for transient occupancy (bed) tax revenues and Fairmont Scottsdale Princess Hotel Lease payments which are to be used for tourism related activities and General Fund support. The FY 2025/26 budgeted revenue is $37.3 million and budgeted expenditures are $36.4 million. The Stadium Facility Fund is a special revenue fund created to account for activity at the Scottsdale Stadium. In June 2019, the city entered into a 25-year baseball facilities agreement with the Scottsdale Charros and the San Francisco Giants Baseball Club for the use and maintenance of the Scottsdale Stadium. This fund accounts for the contributions and uses as per the agreement. The fund is projected to receive revenues of $2.2 million in FY 2025/26, uses of $4.3 million and a projected June 30, 2026 ending fund balance of $3.9 million. DEBT SERVICE FUND The Debt Service Fund is designated for payment of long-term debt. Total sources are $78.4 million for FY 2025/26. The $78.6 million budget for debt service payments in FY 2025/26 is approximately $15.0 million less than the FY 2024/25 Adopted Budget. ENTERPRISE FUNDS Enterprise Funds account for the city’s water and water reclamation, solid waste, and aviation services, which operate as selfsustaining operations. User fees are assessed to cover cost of services. Water and Water Reclamation Funds – The Water Fund is impacted by multiple cost factors over the five‐year planning period including: • Increasing costs for raw water. • Increasing electricity costs for water plan production, booster stations operations and other essential system power supply. • Operating cost increases for personnel services and benefits. Increases to base fees are proposed to better reflect the recovery of fixed operating costs and adjusted to capture the demand availability designed into the system. Increases to commodity rates are proposed to generate sufficient revenues to maintain the water fund as a self-sustaining enterprise, encourage efficient water use and urge conservation. Increased commodity rates are proposed for all tiers within both the residential and commercial rates. Overall, the water and water reclamation base fees and commodity rate changes are forecasted to generate an annual revenue increase of approximately $14.2 million. Water rate changes are effective on November 1, 2025, and water reclamation rates on July 1, 2025. Solid Waste Fund – The Solid Waste Fund accounts for the transactions related to the city’s commercial and residential refuse, recycling, brush, and bulk collections business activities. To maintain the revenue requirements of the Solid Waste Fund, modifications to the residential and commercial solid waste rates were implemented effective July 1, 2025, and are expected to generate approximately $1.8 million in additional revenue. Revenue requirements for the Solid Waste Fund for FY 2025/26 were primarily impacted by inflationary effects, landfill and transfer disposal costs, and recycling market volatility and resulting costs. Total Solid Waste Fund sources are expected to be about $38.4 million, annual uses are expected to be $36.9 million, and ending fund balance is projected to be $11.8 million at the end of FY 2025/26. Aviation Fund – The Aviation Fund accounts for the transactions related to the city’s aviation business activity at the Scottsdale Airport. Total Aviation Fund sources are expected to be about $11.0 million, annual uses are expected to be $6.6 million, and ending fund balance is projected to be $20.0 million at the end of FY 2025/26. INTERNAL SERVICE FUNDS Internal Service Funds account for services and equipment provided to all city departments by centralized functions. There are five Internal Service Funds – Fleet Management, Fleet Replacement, PC Replacement, Risk Management and Healthcare Self Insurance. 23 Table of Contents OVERVIEW | Executive Summary The Fleet Management Fund accounts for the costs of operating and maintaining, all the city’s vehicles, equipment, and other rolling stock. User departments are assessed maintenance and operation costs ($10.9 million) and fuel costs ($5.6 million). Fleet Management, in cooperation with the corresponding departments, calculates an annual rate for each individual asset based on condition, suitability for service, the state of the current economy, the repair history, the actual utilization rate of each asset and other applicable factors. The projected FY 2025/26 fund balance of about $7.2 million represents funds previously collected for maintenance and operations that will be expended in future years. The Fleet Replacement Fund accounts for all fleet acquisition and replacement activities. Fleet Management establishes, collects, and manages funds to provide acquisition and/or replacement of approved fleet assets based on life cycle cost analysis performed on each equipment class. Projected revenues into the fund are $28.6 million with expenditures of $27.1 million, leaving a projected ending fund balance in FY 2025/26 of $1.6 million. The PC Replacement Fund accounts for the uses associated with purchasing computers, monitors and printers. Acquisition of computers, monitors and printers is charged to city departments as an internal operating charge based on the quantity and type of hardware used. For FY 2025/26, user departments will be assessed estimated costs of $1.0 million. The fund has projected expenditures of $1.3 million, leaving an estimated FY 2025/26 ending fund balance of $1.2 million. The Risk Management Fund accounts for the activity related to the city’s property, liability, and workers compensation programs. Total revenues into the fund are estimated at $21.5 million; user departments pay $20.1 million of this revenue through assessments. The estimated ending fund balance on June 30, 2026, of about $34.7 million is within the actuarial estimate of the reserves required to ensure the long-term sustainability of the fund and complies with the governing body’s (Loss Trust Fund Board) requirement to maintain a 75 percent confidence level in the actuarial assessment. The Healthcare Self Insurance Fund accounts for the activity related to employee healthcare programs (medical and dental). The estimated $44.1 million in healthcare expenditures from this fund is shared by the city, its employees and public safety disabled retirees. For FY 2025/26, the city’s portion of the shared cost was set at a lower amount than needed to utilize fund balance. FY 2025/26 presents a $4.0 million increase in uses compared to the FY 2024/25 adopted budget due to rising healthcare costs. The projected FY 2025/26 ending fund balance of $20.6 million includes: 1) a reserve for large claims beyond what was anticipated and for incurred but not reported claims; 2) an operating contingency used only for unforeseen emergencies; 3) a premium stabilization reserve to ensure revenue from premiums exceed medical and dental claims and administrative expenses paid by the healthcare plan; and 4) a healthcare self insurance fund balance which accounts for any remaining funds after the designation of all other reserves/uses. Under prudent fiscal management practices, the healthcare self insurance fund balance should most appropriately be used for one-time uses, not to fund new or to expand programs with ongoing operating expenses. GRANTS AND SPECIAL DISTRICTS FUNDS Each year the city receives Grant Funds from a variety of federal, state, regional and local agencies. Within the $24.8 million of total grant funding there are three larger grants: Housing Choice Voucher Program (previously Section 8 Housing Grant) at $10.8 million, the HOME Investment Partnership Grant at $1.3 million, and the Community Development Block Grant (CDBG) at $2.8 million. In addition to numerous identified smaller grants, the city includes $4.0 million in the grant budget for anticipated and/or unidentified future grants. This gives the City Council the budget authority to accept and spend grant funds that are not specifically known at the time the budget is adopted. This practice also allows the city to comply with state budget laws regarding annual expenditure limits. The ending fund balance of the individual grants is carried forward to future periods, re-budgeted, and is available to be spent solely for the intended purposes. A Special Districts Fund is used to account for the proceeds received from property owners in the city’s 357 streetlight districts. The intention is that only the amount needed to provide the service is assessed to the customer. Sources are estimated at $0.6 million and uses are estimated at $0.6 million for FY 2025/26. If an ending fund balance of the Special Districts Fund exists, it is carried forward to future periods and is available to be re-budgeted but must be spent solely for the intended purposes. CAPITAL IMPROVEMENT PLAN A separate, key component of the city’s annual financial plan is the five-year Capital Improvement Plan (CIP) for infrastructure and public facilities – including roads, water and water reclamation improvements, parks, buildings and information technology. Projects 24 Table of Contents OVERVIEW | Executive Summary listed in the capital budget are funded by a combination of funding sources and typically take multiple years to complete. Some of the funding sources include the city’s transportation sales tax; voter approved general obligation bonds (including Bond 2019), user fees, grants, Proposition 400 Regional Transportation Sales Tax, voter-approved Preservation Sales Tax, development impact fees and General Fund transfers. The city established a fund for each funding source to track the diverse resources used to pay for the acquisition or construction of major capital projects. Below is a summary of the $974.2 million capital budget highlights by program, along with some notable examples in each capital program area: Community Facilities ($93.3 million) – focuses on providing library improvements, parks, park improvements, multiuse paths, neighborhood enhancements, youth sports lighting, aquatic centers, library facilities and senior centers. Approximately 9.6 percent of the CIP addresses the needs of this program. Significant Community Facilities projects during FY 2025/26 include the McCormick-Stillman Roundhouse; Scottsdale Stadium Renovations Phase 2; as well as the continuation and initiation of various Bond 2019 program projects. Some examples are the 42 - Add a Dog Park to Thompson Peak Park; 22 – Build New Swimming Pools and Replace Building at Cactus Pool; and 23 – Repair Lakes and Irrigation at Vista del Camino Park in the Indian Bend Wash. Preservation ($11.8 million) – addresses the goal of preserving the character and environment of Scottsdale. This goal is met by land acquisition activities for the Scottsdale McDowell Sonoran Preserve for maintaining scenic views, preserving native plants and wildlife, and providing public access to the McDowell Mountains and Sonoran Desert. Approximately 1.2 percent of the CIP addresses this program. Significant preserve projects include a feasibility study for the Rio Verde Wildlife Crossing, trailhead improvements, and wildland fire prevention and safety improvements. Drainage and Flood Control ($38.5 million) – addresses flood plain mapping, meeting regulatory requirements, and identifying and correcting hazards to reduce future flood damage potential. This is accomplished using detention basins, culvert and channel projects, and a program of neighborhood drainage improvements. Approximately 4.0 percent of the CIP addresses the drainage and flood control needs of the city. Major Drainage and Flood Control projects include various WestWorld projects, the Roosevelt Street Storm Drain project, the Villa Monterey Drainage Improvement project, and the Princess Drive Drainage project. Public Safety ($78.4 million) – addresses the construction, acquisition, and purchase of capital assets for the Police and Fire Departments, such as fire and police stations, training facilities and automation systems related to fire and police operations. Approximately 8.0 percent of the CIP addresses the public safety needs of the city. The Public Safety budget includes key projects such as Renovate Fire Station 606; and various Bond 2019 program projects. Some examples are the 38-Build a New Fire Department Training Facility; 40 - Renovate and Expand the Civic Center Jail and Downtown Police Facility to Meet Demand; 33Renovate the Via Linda Police Station to Increase Efficiency and the 27 - Modernize and Expand the Police and Fire Training Facility. Service Facilities ($159.1 million) – addresses the goal of coordinating land use and infrastructure planning. These programs achieve this goal through the renovation of current facilities and technology necessary for the efficient and effective operations of the city. Approximately 16.3 percent of the CIP addresses this program. Service Facilities projects include Facilities Upgrade and Replacement Program; Network and Server Infrastructure Replacement Program; the continuation of the Enterprise Resource Planning System; and the continuation of various Bond 2019 program projects. Some examples are the 63-Build Parking Structures in Old Town Scottsdale and solar system installation and upgrade projects. Transportation ($261.8 million) – addresses multi-modal transportation needs. Approximately 26.9 percent of the CIP addresses the transportation needs of the city. Significant Transportation projects include various pedestrian improvements; Pavement Overlay Program; Pima Road: Dynamite Boulevard to Las Piedras; Scottsdale Road: Jomax Road to Dixileta Drive; Happy Valley Road: Pima Road to Alma School Road; Shea Boulevard Intersections: Arizona State Route 101 to 136th Street; Intelligent Transportation System Infrastructure and Network Improvements; and Kilo Ramp Rehabilitation. Water Management ($331.3 million) – focuses on the capital needs required to deliver safe, reliable water and to provide water reclamation services. This program also addresses the requirement to achieve federal and state regulations. Approximately 34.0 percent of the CIP addresses the water and water reclamation needs of the city. Significant projects include the Greenway Hayden Loop Sewer Improvements, deep well recharge and recovery projects, as well the design and construction of multiple other projects to keep water treatment facilities functioning properly. 25 Table of Contents OVERVIEW | Executive Summary The five-year CIP uses conservative financial forecasts and reflects only those high priority projects expected to be started and often completed during the next five years. This approach helps the city manage operating costs for new facilities and avoids raising expectations for projects that are not well defined. The budget continues the practice of leveraging one-time elastic revenue from the General Fund (e.g., construction sales tax and development fees, excess interest) to help pay for capital projects. The municipal bond rating agencies view this as a sound fiscal practice. The FY 2025/26 budget transfers a total of $48.8 million from the General Fund to the CIP. CONCLUSION The goal of this summary is to provide the reader with some key highlights that are most likely to be of interest to readers. For readers requiring greater levels of detail and information, they are encouraged to review the rest of Volume One (Budget Summary), Volume Two (Department Operating Budget), and Volume Three (Capital Improvement Plan). 26 Table of Contents OVERVIEW | Executive Summary S um m a r y o f F T E C ha ng e s F T E C h a n g e s f r o m P r i o r F i s c a l Y e a r b y De p a r t m e n t F Y 2 0 2 4 /2 5 A do p t e d F T E s 2, 700. 45 F Y 2 0 2 4 /2 5 F TE A dj u s t m e n t / R e c l a ssi f . D e pa r t m e n t / P o si t i o n T i t l e M A Y O R A N D CO U N CI L EXECUTIVE ASSISTANT F TE Ch a n g e s F Y 2 0 2 5 /2 6 N e t Ch a n g e from FY 2 0 2 4 /2 5 (1.00) ( 1. 00) S u bt o t a l - (1.00) ( 1. 00) S u bt o t a l 2.00 2.00 0.63 0.63 2.00 0.63 2.63 S u bt o t a l - 1.00 1.00 1.00 1.00 S u bt o t a l - 1.00 1.00 1.00 1.00 S u bt o t a l - 1.00 1.00 0.50 2.50 1.00 1.00 0.50 2.50 S u bt o t a l 1.63 1.00 3.00 1.00 6.63 - 1.63 1.00 3.00 1.00 6.63 S u bt o t a l 0.50 1.00 1.50 1.00 1.00 1.00 3.00 0.50 1.00 1.00 1.00 1.00 4.50 P O L I CE D E P A R T M E N T POLICE CIVILIAN INVESTIGATOR POLICE COMMUNICATIONS DISPATCH POLICE LIEUTENANT - (SWORN) POLICE OFFICER - (SWORN) POLICE OFFICER - PARK RANGER - (SWORN) POLICE PROPERTY/EVIDENCE TECH POLICE RECORDS SPECIALIST POLICE RECORDS SUPERVISOR POLICE RTCC SUPERVISOR POLICE RTCC TECHNICIAN POLICE SERGEANT - (SWORN) S u bt o t a l - 1.00 4.00 1.00 4.00 3.00 1.00 1.00 1.00 1.00 4.00 1.00 22. 00 1.00 4.00 1.00 4.00 3.00 1.00 1.00 1.00 1.00 4.00 1.00 22. 00 - 2.00 1.00 8.00 3.00 29.00 1.00 44. 00 2.00 1.00 8.00 3.00 29.00 1.00 44. 00 1.00 1.00 1.00 1.00 (0.04) - 6.00 1.00 1.00 1.00 1.00 (0.04) - 1.00 3. 96 7. 00 1.00 10. 96 CI T Y A T T O R N E Y ' S O F F I CE DEPT SAFETY & TRAINING COORD ASSISTANT CITY ATTORNEY I CI T Y CL E R K ' S O F F I CE MANAGEMENT ASSOCIATE CI T Y CO U R T SOFTWARE ENGINEER SENIOR CI T Y T R E A S U R E R ' S O F F I CE BID & CONTRACT ANALYST DEPUTY BUDGET DIRECTOR INTERN CO M M U N I CA T I O N S COMMUNICATIONS SPECIALIST COMMUNICATIONS SUPERVISOR DIGITAL MEDIA DESIGNER VIDEO PRODUCTION ASSISTANT H U M A N R E S O U R CE S HUMAN RESOURCES INTERN HUMAN RESOURCES ANALYST SR. HUMAN RESOURCES ASST DIRECTOR HUMAN RESOURCES MANAGER HUMAN RESOURCES SUPERVISOR F I R E D E P A R TME NT AMBULANCE BILLING SPECIALIST EMS TRAINING AND CERTIFICATION FIRE CAPTAIN (56) - (SWORN) FIRE ENGINEER (56) - (SWORN) FIREFIGHTER (56) - (SWORN) WILDLAND URBAN INTERFACE RISK S u bt o t a l E NTE R P R I S E O P E R A TI O NS OLD TOWN SPECIALIST BUSINESS OPERATIONS MANAGER SENIOR DIRECTOR ENTERPRISE OPERATIONS ADMINISTRATIVE ASSISTANT RECREATION LEADER I RECREATION LEADER II RECREATION LEADER SENIOR S u bt o t a l 6.00 F Y 2 0 2 4 /2 5 F TE F T E Ch a n g e s A dj u s t m e n t / R e c l a ssi f . D e pa r t m e n t / P o si t i o n T i t l e F Y 2 0 2 5 /2 6 N e t Ch a n g e from FY 2 0 2 4 /2 5 P L A N N I N G A N D D E V E L O P M E N T S E R V I CE S CODE ENFORCEMENT ASSISTANT S u bt o t a l (1.00) ( 1. 00) - (1.00) ( 1. 00) L I B R A R Y & H U M A N S E R V I CE S DEPT SAFETY & TRAINING COORD INTERN COMMUNICATIONS SPECIALIST COMMUNICATIONS SUPERVISOR DIGITAL MEDIA DESIGNER VIDEO PRODUCTION ASSISTANT EXECUTIVE DIRECTOR EXECUTIVE ASSISTANT SR. MANAGEMENT ANALYST BUSINESS OPERATIONS MANAGER SENIOR DIRECTOR ENTERPRISE OPERATIONS HUMAN SERVICES DEPT DIRECTOR SENIOR DIRECTOR LIBRARY & HUMAN SVCS OTHER ADJUSTMENTS HUMAN SERVICES CASE WORKER HUMAN SERVICES SPECLIST RECREATION LEADER II S u bt o t a l (1.00) (0.01) (1.63) (1.00) (3.00) (1.00) (1.00) (1.00) (1.00) (1.00) (1.00) (1.00) 1.00 (3.21) ( 15. 85) (0.73) (0.50) 1.00 ( 0. 23) (1.00) (0.01) (1.63) (1.00) (3.00) (1.00) (1.00) (1.00) (1.00) (1.00) (1.00) (1.00) 1.00 (3.21) (0.73) (0.50) 1.00 ( 16. 08) P A R K S & R E CR E A T I O N & P R E S E R V E INTERN SENIOR DIRECTOR PARKS & REC & PRESERVE EXECUTIVE ASSISTANT SR. MANAGEMENT ANALYST ADMINISTRATIVE ASSISTANT RECREATION LEADER I MAINTENANCE TECHNICIAN PARKS MAINTENANCE FOREMAN URBAN FORESTER PLANNER PRINCIPAL LIFEGUARD/INSTRUCTOR PUBLIC WORKS PROJECT COORD RECREATION LEADER I RECREATION LEADER II MAINTENANCE WORKER II S u bt o t a l 0.01 1.00 1.00 1.00 (1.00) 0.04 2.05 1.00 1.00 1.00 1.00 1.84 1.00 0.12 0.58 1.47 9.01 0.01 1.00 1.00 1.00 (1.00) 0.04 1.00 1.00 1.00 1.00 1.84 1.00 0.12 0.58 1.47 11. 06 S u bt o t a l - 1.00 1.00 1.00 1.00 S u bt o t a l - 1.00 1.00 1.00 1.00 T R A N S P O R T A T I O N A N D I N F R A S T R U CT U R E DEPT SAFETY & TRAINING COORD CITY ENGINEER SR DIRECTOR CITY ENGINEER DEPT SYSTEMS ANALYST/PROG II ITS SIGNALS TECH I ITS SIGNALS TECH II MANAGEMENT ANALYST PROJECT MANAGER SENIOR PUBLIC WORKS PROJECT COORD PROJECT MANAGEMENT ASSISTANT S u bt o t a l (1.00) (1.00) 1.00 ( 1. 00) 1.00 1.00 1.00 1.00 2.00 1.00 0.25 7.25 (1.00) (1.00) 1.00 1.00 1.00 1.00 1.00 2.00 1.00 0.25 6.25 T o t a l Ch a n g e f r o m A d o p t e d F Y 2 0 2 4 / 2 5 ( 1. 71) 98. 16 96. 45 F L E E T MA NA G E ME NT FLEET MECHANIC F A CI L I T I E S M A N A G E M E N T ELECTRICIAN F Y 2 0 2 5 /2 6 A do p t e d F T E s 2, 796. 90 27 Table of Contents 28 Table of Contents Fiscal Year 2025/26 Budget Transmittal Page 2 of 5 • 22 positions in the Police Department for patrol, investigations, support services, and the Police Ranger program. • 9.01 positions in Parks, Recreation, and Preserve. • 7 positions in Enterprise Operations. • 7.25 positions in Transportation and Infrastructure. • 8.90 positions in other city departments. Investing in these roles will improve emergency response times, enhance public safety, and maintain the quality of community services residents rely on. The budget also continues the performance pay programs to help employees keep up with rising cost of living and ensure Scottsdale remains competitive in attracting and keeping talented staff. Additional funding is included to raise salaries in certain jobs to match market rates. Fair pay and strong benefits are essential for Scottsdale to remain an employer of choice in an increasingly competitive labor market. A n ew revenue stream The budget includes $25.2 million in new revenue from the 0.15% Park and Preserve sales tax that voters approved in November 2024, provide important financial backing for key public safety and preservation initiatives. The funds will be used for park improvements and maintenance, upkeep in Scottsdale's McDowellSonoran Preserve, and improved safety in the Preserve, city parks, and the wildland urban interface in the form of additional Police park rangers and Fire Department wildfire mitigation and technical rescue. This new tax replaces the expiring 0.20% Preserve sales tax, which was used to buy land for the Preserve.As a result, the city's local sales tax rate drops from 1.75% to 1.70% starting July 1, 2025. General Fund Expenditures The General Fund operating budget (excluding transfers) for FY 2025/26 shows a net increase in spending of $89.2 million from the previous year, driven largely by a one-time $50 million payment to the Police PublicSafety R etirement PlanSystem and $5.3 million for salary adjustments to align employee pay to the market. Noteworthy General Fund expenditure changes in the Proposed 2025/26 Budget are highlighted below; additional detail about all changes can be found in the Department Operating sections. Police Department • $50.0 million for a one-time PSPRS pension liability paydown. • $3.0 million to move operating capital funding from the CIP to the operating budget. • $0.9 million for the addition of 11 patrol vehicles and relevant upfitting costs ($1.2 million all funds for 15 patrol vehicles) • $0.8 million for the addition of two Drone as First Responder operations. 29 Table of Contents Fiscal Year 2025/26 Budget Transmittal Page 3 of 5 • $0.4 million for new software programs. • $0.4 million for providing municipal security at locations such as One Civic Center, City Hall, and Libraries. Fire Department • $4.5 million for Phase II of the ambulance service including 25 FTE, medical exams, training, billing and dispatch contracts, equipment, and supplies. • $1.5 million to re-staff a second truck for Station 601 to include 15 FTE, medical exams, training, uniforms, and supplies. • $1.4 million to move operating capital funding from the CIP to the operating budget. • $0.5 million for the warehouse lease agreement and operating costs. • $0.4 million of one-time funding to properly upfit various fire apparatus vehicles. • $0.4 million of one-time funding to replace 250 ballistic vest panel inserts. • $0.4 million to support the new training facility. Communications Department • 0.2 million to carryover consultant services costs fordeveloping the American Disability Act Transition Plan Phase I approved for FY 2024/25. Other City Departments • Enterprise Operations -$0.4 million to fund a new strategic plan for Scottsdale Arts and an expected increase in the financial participation agreement with Scottsdale Arts. • Facilities Management -$0.7 million for inflationary cost increases for utilities. • Planning and Development Services -$0.6 million to cover subscription costs for planning/fire permitting, inspections, and code enforcement software. • Transportation and Infrastructure -$2.6 million to keep Capital Projects Management in the operating budget; and $0.3 million for new project management software intended to improve efficiency and enhance data accuracy across capital projects. • Human Resources -$0.4 million to add 3.0 FTEs, which include a Human Resources Assistant Director, a Human Resources Manager to supervise employee training, and a Human Resources Supervisor oversee employee benefits. • Information Technology-$0.8 million to address increased cost in software and licensing subscriptions; $0.7 million to fund an artificial intelligence initiative to enhance efficiency and improve service delivery; and $0.4 million to fund additional cloud services. 30 Table of Contents Fiscal Year 2025/26 Budget Transmittal Page 4 of 5 Capital Improvement Program The five-year Capital Improvement Plan (CIP) totals $2.20 billion; the budget for FY 2025/26 is $974.2 million including contingencies. The projects highlighted below address City Council priorities and critical capital infrastructure needs in a variety of areas and are supported by different funding sources. Capital project costs that do not have a dedicated funding source are funded by transfers from the General Fund. The total FY 2025/26 transfers to CIP from the General Fund operating budget is $48.8 million. Notable projects for FY 2025/26 are highlighted below. Please note that the amounts shown are the amounts budgeted for FY 2025/26 and may not reflect the total cost of the project. • Bond 2019 Program (FY2025/26: $134. 7 million)- The voter approved Bond 2019 program supports important community infrastructure projects with a total of $319 million in bond funds. To date, the city has completed 18 of these projects, and the FY2025/26 budget includes funding for additional Bond 2019 projects in various stages including expanding the Granite Reef Senior Center, repairing lakes and irrigation at Vista del Camino Park, and adding a dog park to Thompson Peak Park. • Pavement Overlay Program(FY 2025/26: $43.0 million)-Scottsdale's streets and pavement require greater investment, and the CIP includes substantial funding for ongoing street pavement, public alley overlays, and all other associated improvements. (Funding Source: Transportation 0.20% Safes Tax, HURF) • Old Town Beautification and Infrastructure Upgrades (FY 2025/26: $2.0 million)- Funds to design and build pedestrian improvements in Old Town Scottsdale. (Funding Source: General Fund) • Brown Avenue Parking Structure (FY 2025/26: $21.0 million)- Funds to design and build an expansion of the Brown Avenue Parking Corral in Old Town Scottsdale (Brown Ave. between 1st and 2nd Streets). The new construction will provide approximately 374 to 395 public parking spaces, a net increase of 162 to183 spaces depending on final design. (Funding Sources: 2019 Bond) • Build New Parking Structure in the NE Quadrant (FY 2025/26: $14.6 million) - Funds to design and build a new parking garage in the northeast quadrant of Old Town Scottsdale (north and south of 6th Avenue, east of Wells Fargo Avenue and west of Civic Center Plaza. The new garage will provide approximately272 public parking spaces, a net increase of 128 spaces over the current count of 144. (Funding Sources: General Fund) 31 Table of Contents Fiscal Year 2025/26 Budget Transmittal • Page 5 of 5 64th Street Canal Path Wall: Thomas Road to Indian School Road (FY 2025/26: $0.6 million) -The concrete retaining wall along the Crosscut Canal between Thomas Road and Indian School Road requires repair. (Funding Sources: Transportation 0.20% Sales Tax) • Scottsdale Road: Thompson Peak Parkway to Pinnacle Peak Road Phase II (FY 2025/26: $0.9 million) - This project will complete Scottsdale Road to the ultimate six-lane major arterial configuration including the major intersections at Thompson Peak Parkway, Deer Valley Road, Williams Drive, and Pinnacle Peak Road to improve safety, capacity and accessibility for vehicles, bicycles and pedestrians. (Funding Sources: Regional Sales Tax -Arterial Life Cycle Program, Transportation 0. 1 % Sales Tax 2019) • Greenway Hayden Loop Sewer Improvements (FY 2025/26: $21.6 million) - This project replaces the 18-inch diameter sewer with a 21-inch diameter and a 30-inch diameter sewer to upsize capacity for current and future connections north of Frank Lloyd Wright Boulevard between Pima Road and Princess Drive. (Funding Source: Water Reclamation Rates, Sewer Development fees, MPG Bonds) Conclusion The Fiscal Year 2025/26 budget provides a robust foundation for our municipal organization to continue delivering the world-class service our residents expect. I thank the City Council for their guidance and support in developing this critical plan. Special thanks also go to the City Treasurer's Office, budget staff, department liaisons, and all city employees who helped create it. We look forward to implementing this budget and serving the Scottsdale community in the months ahead. Sincerely� G.z.ton City Manager 32 Table of Contents 33 Table of Contents 34 Table of Contents 35 Table of Contents 36 Table of Contents 37 Table of Contents 38 Table of Contents 39 Table of Contents 40 Table of Contents 41 Table of Contents 42 Table of Contents 43 Table of Contents 44 Table of Contents 45 Table of Contents 46 Table of Contents 47 Table of Contents 48 Table of Contents 49 Table of Contents 50 Table of Contents 51 Table of Contents 52 Table of Contents 53 Table of Contents 54 Table of Contents 55 Table of Contents 56 Table of Contents 57 Table of Contents Fiscal Year 2025/26 Proposed Budget Transmittal Letter Honorable Mayor, City Council, and Budget Review Commission I am pleased to present you the City of Scottsdale’s Fiscal Year Proposed 2025/26 Budget and five year Capital Improvement Plan for FY 2025/26 through FY2029/30 for your consideration. The Proposed Budget is a balanced budget that provides Scottsdale citizens a significant return on their tax dollars. The budget bolsters core city services and addresses significant community priorities. This budget was realized through the work and efforts of department and division directors and staff to provide funding for council and organization goals, while still maintaining taxes and fees low for citizens and continuing our high levels of existing service for our customers. The total Proposed FY2025/26 Budget is $2.208 billion consisting of the proposed Operating Budget of $1.229 billion, including contingencies, and proposed Capital Budget of $978.5 million, including contingencies. The Proposed Budget shows a 3.8% decrease from the Adopted FY 2024/25 budget of $2.295 billion. It anticipates that there will be a reduction in sales tax revenues in FY 2025/26 when compared to the current FY 2024/25 forecast, due to the continued implementation of the State’s elimination of the residential rental tax and lower consumer spending with uncertain economic conditions. The Proposed Budget projects that sales tax revenues will return to modest levels of growth in FY 2026/27 and into future years. The city’s five-year CIP for FY 2025/26 through FY 2029/30 totals $2.24 billion consisting of $995.5 million in water and wastewater projects, $540.5 million in transportation projects, $213.9 million in service facility projects, $208.2 million in community facilities projects, $111.8 million in public safety projects and $167.9 million in flood control and other projects. Staffing additions and notable programs and initiatives The proposed budget includes 98.16 new full-time equivalents (FTEs) consisting of the following:  44.00 new FTEs for the Fire Department to staff Fire Station 608, phase II of the ambulance service program, and fire mitigation and rescue services  22.00 new FTEs for the Police Department for supportive, investigative and uniformed services, and to staff the Police Ranger program  9.01 new FTEs for the Parks Recreation and Preserve Department  7.00 new FTEs for the Enterprise Operations Department  7.25 new FTEs for the Transportation and Infrastructure Department  8.90 FTE for all other city departments More detail regarding these FTE positions can be found in the FY 2025/26 Operating Expenditure Summary section of the budget document. This budget proposal continues the ongoing market and performance pay adjustment programs for staff (detailed in the General Fund Expenditures section below), which will help employees face persistent inflation costs, and help the city retain top-quality talent amidst wage pressures in the region. Additionally, the Proposed FY 2025/26 budget includes additional funding for salary adjustments to bring certain positions in line with the market. The proposed budget includes $25.2 million of new revenues from the 0.15% Park and Preserve sales tax approved by voters in November 2024 and effective July 1, 2025. These revenues are allocated according to Council adopted Ordinance No. 4633 for park improvements and maintenance, Preserve maintenance, Police park ranger program and Fire fuel mitigation and technical rescue. The 0.15% Park and Preserve sales tax was approved by voters to replace 58 Table of Contents the expiring 0.20% Preserve sales tax used for the acquisition of land in the Preserve, which will result in the city’s local sales tax rate being lowered from 1.75% to 1.70% effective July 1, 2025. General Fund Revenue Sources General Fund revenue (excluding transfers) estimates reflect a modest net increase of $4.3 million from the adopted FY 2024/25 budget. That total projected net increase comes from several different sources and factors, most notably:  Local Sales Taxes – The Proposed Budget projects an increase of $5.2 million from the FY2024/25 adopted budget of $183.0 million, including the public safety 0.1% sales tax. The current FY 2024/25 forecast projects that $196.0 million will be received by the end of FY 2024/25. The FY 2025/26 Proposed Budget expects a $7.8 million decrease from the forecast to a total of $188.2 million; these estimates reflect anticipated slower growth and also reflect the continued impact of the residential rental tax elimination that went into effect in January 2025.  State-Shared Taxes and Vehicle Licensing Fees – The Proposed Budget projects a decrease of ($4.0 million) due primarily to the state’s switch to a flat income tax rate model.  Primary Property Tax Collections – The Proposed Budget projects an increase of $1.6 ($0.8 million due to the allowable 2% statutory adjustment and $0.4 million due to new growth).  Building Permit Fees – The Proposed Budget projects an increase of $2.0 million from Building Permit Fees & Charges to help cover inflationary costs and department operating costs to provide an excellent customer experience.  Fire Department Revenues – The Proposed Budget projects an increase of $3.6 million in additional revenue from the recently created ambulance transportation service, increases associated with third-party fire protection system inspections and from special events reimbursements.  Interest Earnings - The Proposed Budget projects a decrease of ($4.5 million) due to a reduction in fund balance and a changing interest rate environment. General Fund Expenditures The General Fund proposed operating budget (excluding transfers) for next fiscal year shows a net increase in spending of $89.5 million from the FY 2024/25 adopted budget which includes a one-time $50 million payment to the Police Public Safety Retirement Plan System and $5.3 million for salary adjustments to align to the market. Noteworthy General Fund expenditure changes in the Proposed 2025/26 Budget are highlighted below; additional detail about all changes can be found in the Department Operating sections. Police Department       $50.0 million for a one-time PSPRS pension liability paydown. $2.8 million to move operating capital funding from the CIP to the operating budget. $0.9 million for the addition of 11 patrol vehicles and relevant upfitting costs ($1.2 million all funds for 15 patrol vehicles) $0.8 million for the addition of two Drone as First Responder operations. $0.4 million for new software programs. $0.4 million for providing municipal security at locations such as One Civic Center, City Hall, and Libraries. Fire Department   $4.5 million for Phase II of the ambulance service including 25 FTE, medical exams, training, billing and dispatch contracts, equipment, and supplies. $1.5 million to re-staff a fire truck for Station 608 to include 15 FTE, medical exams, training, uniforms, and supplies. 59 Table of Contents      $1.4 million to move operating capital funding from the CIP to the operating budget. $0.5 million for the warehouse lease agreement and operating costs. $0.4 million of one-time funding to properly upfit various fire apparatus vehicles. $0.4 million of one-time funding to replace 250 ballistic vest panel inserts. $0.4 million to support the new training facility. Communications Department  0.2 million to carryover consultant services costs for developing the American Disability Act transition plan Phase I approved for FY 2024/25. Other City Departments       Enterprise Operations Department - $0.4 million to fund a new strategic plan for Scottsdale Arts and an expected increase in the financial participation agreement with Scottsdale Arts. Facilities Management Department - $0.7 million for inflationary cost increases for utilities. Planning and Development Services Department - $0.6 million to cover subscription costs for planning/fire permitting, inspections, and code enforcement software. Transportation and Infrastructure Department - $3.3 million to keep Capital Projects Management in the operating budget; and $0.3 million for new project management software intended to improve efficiency and enhance data accuracy across capital projects. Human Resources Department - $0.5 million to add 3.0 FTEs, which include a Human Resources Assistant Director, a Human Resources Manager to supervise employee training, and a Human Resources Supervisor oversee employee benefits. Information Technology Department - $0.8 million to address increased cost in software and licensing subscriptions; $0.7 million to fund an artificial intelligence initiative to enhance efficiency and improve service delivery; and $0.4 million to fund additional cloud services. Capital Improvement Program The proposed five-year Capital Improvement Plan (CIP) totals $2.24 billion with the Proposed CIP budget for FY 2025/26 at $978.5 million including contingencies. The projects highlighted below address City Council priorities and critical capital infrastructure needs in a variety of areas and are supported by different funding sources. Capital project costs that do not have a dedicated funding source are funded by transfers from the General Fund. The total FY 2025/26 transfers to CIP from the General Fund operating budget is $48.8 million. Notable projects for FY 2025/26 are highlighted below. Please note that the amounts shown are the amounts budgeted for FY 2025/26 and may not reflect the total cost of the project.     Bond 2019 Program (FY2025/26: $136.2million) - The voter approved Bond 2019 program funded 58 projects with a total of $319 million in bond funds. The city has completed 18 projects to date and included in the FY2025/26 budget is funding for 41 Bond 2019 projects in various stages including the expansion of the Granite Reef Senior Center, repairs to lakes and irrigation at Vista Del Camino Park, and adding a Dog Park to Thompson Peak Park. Pavement Overlay Program (FY 2025/26: $43.0 million) - This program is for ongoing street pavement, public alley overlays, and all other associated improvements. (Funding Source: General Fund, Transportation 0.20% Sales Tax, HURF) Old Town Concrete Improvement (FY 2025/26: $2.0 million) - This project will design and construct pedestrian improvements in the Old Town area. (Funding Source: General Fund) Build New Parking Structure in the NE Quadrant (FY 2025/26: $14.6 million) - This project will design and construct a parking garage located in the northeast quadrant of Old Town Scottsdale, both north and south of 60 Table of Contents    E 6th Ave, east of N Wells Fargo Avenue and west of N Civic Center Plaza. The capacity of the new garage will be approximately 272 spaces, providing a net increase of 144 public spaces over the 128 spaces currently at the location. (Funding Sources: General Fund) 64th Street Canal Path Wall: Thomas Road to Indian School Road (FY 2025/26: $0.6 million) - The project will perform repairs to the retaining wall of reinforced concrete along the Crosscut Canal between Thomas Road to Indian School Road. The wall has longitudinal cracking and cosmetic damage in several locations that need repairs. (Funding Sources: Transportation 0.20% Sales Tax) Scottsdale Road: Thompson Peak Parkway to Pinnacle Peak Road Phase II (FY 2025/26: $0.9 million) - This project will complete Scottsdale Road to the ultimate six-lane major arterial configuration including the major intersections of Thompson Peak Parkway, Deer Valley Road, Williams Drive, and Pinnacle Peak Road to improve safety, capacity and accessibility for motor vehicles, bicycles and pedestrians. (Funding Sources: Regional Sales Tax - Arterial Life Cycle Program, Transportation 0.1% Sales Tax 2019) Greenway Hayden Loop Sewer Improvements (FY 2025/26: $21.6 million) - This project replaces the existing 18-inch diameter sewer with a 21-inch diameter and a 30-inch diameter sewer to provide capacity for current and future connections at North of Frank Lloyd Wright Boulevard between Pima Road and Princess Drive. (Funding Source: Water Reclamation Rates, Sewer Development fees, MPC Bonds) Conclusion I would like to express appreciation to the City Council for their guidance and support throughout the development of this proposed budget. Additionally, I’d like to express a special thanks to the City Treasurer’s Office, budget department staff, budget liaisons and all other city staff who have contributed to this budget. This budget proposal supports the Scottsdale community and will allow the city to continue to provide the world class service that our citizens and customers expect. We look forward to discussing the contents of this proposal in more depth with City Council, the Budget Review Commission and the community over the coming months. Sincerely, Greg Caton – Interim City Manager 61 Table of Contents GOVERNMENT FINANCE OFFICERS ASSOCIATION Distinguished Budget Presentation Award PRESENTED TO City of Scottsdale Arizona For the Fiscal Year Beginning July 01, 2024 Executive Director Budget Award for Fiscal Year 2024/25 Budget The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation award to the City of Scottsdale, Arizona for its annual budget for fiscal year beginning July 1, 2024. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as a financial plan, as an operating guide, and as a communications device. This award is valid for a period of one year only. The current budget continues to conform to program requirements and will be submitted to the GFOA to determine its eligibility for another award. 62 Table of Contents OVERVIEW | Budget Development Process CITY OF SCOTTSDALE’S BUDGET DEVELOPMENT PROCESS RECOMMENDED BUDGET PRACTICES The City of Scottsdale’s budget development process incorporates the recommended practices from the Government Finance Officers Association (GFOA). GFOA, founded in 1906, represents public finance officials throughout the United States and Canada. The association’s more than 20,000 members are federal, state/provincial, and local finance officials deeply involved in planning, financing, and implementing thousands of governmental operations in each of their jurisdictions. The focus of GFOA is to advance excellence in public finance in areas such as: budgeting, accounting, financial reporting, debt management, and public fund investing. GFOA recommends a set of best practices for budgeting that are designed to improve effectiveness, transparency, and accountability. The following are excerpts of the Recommended Budget Practices: A framework for improved state and local government budgeting1. A. Budget Process Definition The budget process consists of activities that encompass the development, implementation and evaluation of a plan for the provision of services and capital assets. A good budget process includes several essential features:      Incorporates a long-term perspective Establishes linkages to broad organizational goals Focuses budget decisions on results and outcomes Involves and promotes effective communication with stakeholders Provides incentives to government management and employees These key characteristics make clear that the budget process is not simply an exercise in balancing revenues and expenditures one year at a time, but is strategic in nature, encompassing a multi-year financial and operating plan that allocates resources based on identified goals. A good budget process moves beyond the traditional concept of line-item expenditure control, providing incentives and flexibility to managers that can lead to improved program efficiency and effectiveness. B. Mission of the Budget Process The mission of the budget process is to help decision-makers make informed choices about the provision of services and capital assets and to promote stakeholder participation in the process. The term stakeholder refers to anyone affected by or who has a stake in government. Stakeholders include, but is not limited to residents, customers, elected officials, management, employees, businesses, vendors, other governments and the media. The budget process should accomplish the following:      Involve stakeholders Identify stakeholder issues and concerns Obtain stakeholder support for the overall budgeting process Achieve stakeholder acceptance of decisions related to goals, services and resource utilization Report to stakeholders on services and resource utilization and serve generally to enhance the stakeholders’ view of government The importance of the mission of the budget process cannot be overstated. Regular and frequent reporting is necessary to provide accountability and educate and inform stakeholders. Communication and involvement are essential components of every aspect of the budget process. 63 Table of Contents OVERVIEW | Budget Development Process C. PRINCIPLES/ELEMENTS OF THE BUDGET PROCESS The budget process consists of four broad principles that stem from the definition and mission of the budget process which was previously described. These principles encompass many functions that spread across a governmental organization. They reflect the fact that development of a balanced budget is a political and managerial process that also has financial and technical dimensions. Each principle incorporates components or elements that represent achievable results. These elements help translate the guiding principles into action components. 1. Establish Broad Goals to Guide Government Decision Making  Assess community needs, priorities, challenges and opportunities  Identify opportunities and challenges for government services, capital assets and management  Develop and disseminate broad goals 2. Develop Approaches to Achieve Goals  Adopt financial policies  Develop programmatic, operating, capital policies, and plans  Develop programs and services that are consistent with policies and plans  Develop management strategies 3. Develop a Budget Consistent with Approaches to Achieve Goals  Develop a process for preparing and adopting a budget  Develop and evaluate financial options  Make choices necessary to adopt a budget 4. Evaluate Performance and Make Adjustments  Monitor, measure and evaluate performance  Make adjustments, as needed In total, GFOA identified 59 practices to achieve the higher-level activities identified in the principles and elements of budgeting. Scottsdale’s budget process attempts to incorporate all the GFOA’s recommended practices. BUDGET ROLES AND RESPONSIBILITIES Every Scottsdale employee plays a role in the city’s budget — whether in its formulation, preparation, implementation, administration or evaluation. Ultimately, each department director, through the city manager and other charter officers, is accountable to the City Council for the performance of program personnel in meeting the City Council’s broad goals and specific work plan objectives within allocated resource limits. The actual budget responsibilities of the employees are identified more specifically below: The program managers in city departments are responsible for preparing an estimate of cost requirements and revenues, if applicable, for the current fiscal year, projecting the base budget requirements for the next fiscal year and developing other requests that change or revise the program so that it will be more effective, efficient, productive and economical. The city departments have budget liaisons that coordinate the day-to-day budget management within their respective departments along with the budget staff. The budget liaisons serve as the vital communication link between their city department and the Budget Division on matters related to their specific operating budget. Budget liaisons are responsible for revenue and expenditure forecasts, monthly expenditure and revenue variance analysis, calculating user fees, monitoring the budget, supporting to the Accounting Division in the preparation of the Annual Comprehensive Financial Report, and preparing budget review materials for the city treasurer/chief financial officer, city manager and other charter officers, department directors, City Council, Budget Review Commission, media and residents. The capital improvement plan (CIP) liaisons essentially serve the same role as the budget liaisons; however, their focus is on the coordination of capital projects, multi-year capital planning and identifying capital project operating impacts with the budget staff. In some cases, the same individual serves as both the departmental budget liaison and CIP liaison. 64 Table of Contents OVERVIEW | Budget Development Process The CIP technology review team, CIP construction review team and CIP transportation review team are comprised of individuals from various city departments. These cross-departmental teams are responsible for the initial review of all the city’s capital project requests. Their reviews are focused on ensuring that projects are scoped properly, infrastructure components are coordinated, long-term operating impacts are included, timeframes are realistic, projects are coordinated geographically, and project costs are adequate. They also consider if the request is congruent with city objectives and priorities using a set of predetermined criteria. The review group recommendations are forwarded to the capital management review committee. The capital management review committee (CMRC) is formed by directors and key leadership staff. They provide an organizational-wide view for collaboration and prioritization, serve as advisors for policies and technologies, balance projects against Council objectives and refine the initial prioritization of overall city goals and objectives. The committee presents its funding recommendations to the City Council for final approval. The department directors and charter officers are responsible for reviewing historical performance, anticipating future problems and opportunities, considering alternative solutions and modifying and assembling their program data into a cohesive budget information package. Each department director and charter officer is responsible for evaluating, reviewing, justifying and prioritizing all operating and capital budget requests for their division. Only those requests that department directors and charter officers believe support the City Council’s broad goals, the city’s general plan, city manager’s work plan, administrative direction and program objectives are to be submitted to the budget division. The budget team is comprised of the budget director, assistant budget director, senior budget analysts, and budget analysts. The team is responsible for preparing the multi-fund short-range and long-range revenue and expenditure forecasts, coordinating with budget liaisons in calculating user fees, calculating the indirect cost rate, developing the process and related forms for preparing and monitoring the budget, coordinating the compilation of budget data, analyzing operating and capital budget requests, evaluating and summarizing budget requests from divisions and preparing budget review materials for the city treasurer, city manager other charter officers, department directors, City Council, Budget Review Commission, media and residents. The city treasurer, other city charter officers and department directors collaborate in developing programmatic, operating and capital policies and financial plans that help define how Scottsdale will achieve its long-term goals. They are responsible for reviewing the program operating budget and capital budget requests and for working with program managers to develop service recommendations that are consistent with the City Council’s broad goals, management strategies and the city’s adopted comprehensive financial policies. The city manager is responsible for reviewing the multi-year, multi-fund financial plan and submitting a balanced citywide proposed budget to the Mayor and City Council, which supports their broad goals. From December through May, the city manager holds periodic meetings with the city treasurer/CFO and executive leadership to ensure that the proposed budget addresses the City Council’s priorities and provides guidance on key policy issues related to budget development. The Budget Review Commission serves in an advisory capacity to the City Council on the proposed operating and capital budget, including major revenue forecasts, proposed expenditures, and the city’s budget governing policies. From February to April, the Budget Review Commission holds frequent public meetings to review, discuss, and gather community input on the proposed budget before forwarding its recommendations to the City Council for consideration in the budget adoption process. The Mayor and City Council set the direction for staff related to the forthcoming budget by establishing broad goals for the organization to serve as a basis for decision-making and review key aspects of the city manager’s proposed budget such as the city’s multi-year financial plan including an examination of the revenue forecast and related assumptions, employee compensation including healthcare and retirement costs, changes to rates and fees, comprehensive financial policies, debt schedules, property tax rate and the capital budget. The City Council also receives recommendations from the Budget Review Commission. From March through May, the city treasurer/CFO updates the City Council on the development of the budget process during their monthly meetings. The Mayor and City Council are ultimately responsible for holding public budget hearings to review of the city manager’s proposed budget, tentative budget adoption (mid-May) and final adoption of the budget (mid-June). All City Council budget discussions are open to the public for comments and 65 Table of Contents OVERVIEW | Budget Development Process are broadcast on CityCable 11 and the city’s web page. BUDGET PHASES Needs Assessment and Financial Capacity Phase In this phase, which begins in the late summer and continues up to the final budget adoption, staff compile and update the city’s multi-fund, multi-year revenue forecast. The first year of revenue estimates is the most critical in the process as that will ultimately define the expenditure limitations for the upcoming budget year. The multi-year revenue perspective further refines the city’s planning for current and future period expenditures — with the goal of not adding service areas, services or staff which do not have a ‘sustainable’ funding source over the five-year planning time frame. The preliminary assumptions are used to forecast the city’s fiscal capacity and provide the financial framework within the proposed department budget service levels, capital budget and operating impacts. Policy/Strategy Development and Prioritization Phase During the fall and winter, the City Council typically reviews citizen input, citizen board and commission feedback, financial policies, citizen survey results and the most current financial forecasts. They discuss organizational priorities, constituent suggestions and budgetary expectations. From this, the City Council establishes broad goals and strategic directives, which are the cornerstone for budget development. These broad goals provide the overall direction for Scottsdale and serve as a basis for decision-making. The department directors and senior management staff update city policies, plans, programs and management strategies to define how the city will achieve its goals. It is within this framework that the city staff formulates the proposed operating and capital budgets. Budget Development and Prioritization Phase Capital budget development begins in the early fall in conjunction with the city’s multi-year financial forecasts. Initial departmental capital project requests and changes to existing capital projects are reviewed by cross-departmental teams for accurate costing and congruence with city objectives, and are prioritized using a set of pre-determined criteria. Financing sources are then sought for the highest-ranking projects. When developing their department operating budget plans, staff closely consider the ongoing operating impacts of current and proposed capital projects. Staff also consider the City Council’s broad goals and strategic directives as they develop program objectives and work plans for the budget period. Later in the fall after the CIP development is underway, city staff update their goals for the upcoming fiscal year. Budget staff prepare initial program operating budgets by using a target-based budget approach. This requires that the budget be prepared solely at the existing service operating levels – no significant modifications are permitted at this stage of the budget development process. Department staff are asked to evaluate their programs and/or positions for possible tradeoffs, reductions, eliminations or service level changes to offset inflation, contractual, compensation and benefit cost increases. Under the city’s target-based budget approach, any proposed changes in service levels, new programs, population/service growth, additional staff and program trade-offs resulting in service level reductions/increases must be submitted to the Budget Division in a decision package which is then prioritized and approved by the department’s executive leadership. Departments must provide rigorous analysis, justifying their decision packages. Once submitted, all decision packages are ultimately reviewed by budget staff, the budget director and the city treasurer. The initial multi-faceted review focuses on ascertaining the departments’ needs with the Budget Division’s budget instructions, reviewing the mathematical accuracy and logic of the departmental base budget and decision packages. The review also includes a broader assessment of whether the departmental budget proposals address the City Council’s broad goals, strategic directives, and service needs while maintaining a citywide perspective, ensuring the fiscal integrity of the city (not exceeding forecasted resources/limits). When funding needs exceed the city’s funding limits, remedies may include the identification of new revenues, the employment of process management tools and/or formation of partnerships with other city programs or non-profit organizations. 66 Table of Contents OVERVIEW | Budget Development Process City Management Review Phase The city manager, city treasurer and executive leadership, including the budget director, review decision packages and balance them among numerous competing demands and priorities within the city’s available ongoing resources. The result of this collaboration is the development of a proposed budget and a recommended five-year financial plan for each fund. Budget Review Commission Phase The Budget Review Commission (BRC) convenes throughout the budget process. During spring. the BRC conducts a thorough analysis of the city’s financials and, subsequent to the publication of the proposed budget, review both the operating and capital budgets. The BRC formulates and presents recommendations to the City Council for consideration during the budget adoption process, including potential suggestions for modifications. City Council Review and Adoption Phase In spring, staff present an overview of the proposed operating and capital budgets to the City Council and residents for consideration and further public input. The budget is also communicated to the public through televised public meetings, via the city’s website and YouTube channel. The City Council holds public meetings to review key operating and capital budget policy items. The discussions focus on the city’s five-year financial plans and how the divisions’ operating and capital budgets address residents’ priorities and the City Council’s broad goals. Additionally, the City Council holds meetings to review rates and fees, and financial policies. Later in spring, the City Council adopts the budget and property tax levy consistent with the City Charter and state law. Per the City Charter, the City Council must have tentative adoption of the proposed budget on or before the second regular City Council meeting in May each year (Article 6, Sec. 3. Submission of Recommendations and Estimates to Council). This meeting is usually held in mid-May (Note: State law requires the City Council to adopt the tentative budget on or before the third Monday in July of each fiscal year.) Tentative adoption sets the legal maximum expenditure limit (i.e., appropriation) for the coming fiscal year budget. Under the City Charter (Article 6, Sec. 5. Public Hearing and Adoption of Budget), final adoption of the budget must occur at the first regular City Council meeting in June (Note: There is no specific date set by state law for adoption of the final budget. However, for jurisdictions with a property tax, such as Scottsdale, the recommended deadline for adoption of the property tax levy is the third Monday in August. Since state law requires a period of at least 14 days between adoption of the final budget and adoption of the property tax levy, the budget should be adopted by the first Monday in August of each year). Arizona state law requires a “balanced” budget” (Title 42, Arizona Revised Statutes) and requires the City Council to annually adopt a balanced budget by purpose of public expense, meaning that all revenue sources, including the primary property tax levy, must equal or exceed expenditures. The Arizona Constitution (Article 9, Section 20) also imposes an “expenditure limitation” on municipalities. . 2 Under Arizona state law, “expenditure limitation” means if an item is not budgeted (i.e., does not have an appropriation), it cannot legally be spent during the fiscal year. Therefore, the budget must include enough appropriation and contingency provisions for expenditures related to revenues (e.g., possible future grants) that cannot be accurately determined or even anticipated when the budget is adopted in June. This budgetary flexibility allows the city to comply with the Arizona state law and to proactively pursue emerging revenue sources as the budget year unfolds. Expenditures (i.e., appropriations) associated with items such as possible future grants/revenues may not be spent without the City Council’s prior approval at a public meeting. Arizona Revised Statutes (A.R.S.) only requires communities to prepare budgets for two funds — the General Fund (A.R.S. 42-17101) and the Highway User Revenue Fund (A.R.S. 28-6533) (see the Transportation Fund). In addition to these two funds, the city prepares budgets and requests legal appropriation for the following funds: Special Revenue, Debt Service, Enterprise, Internal Service, Grants, Special Districts and Capital Funds. The ordinance adopting the annual budget requires City Council authorization for expenditures from the funds, which in the aggregate constitutes the city’s total 67 Table of Contents OVERVIEW | Budget Development Process operating, capital budget and contingency/reserves for purposes of complying with the state’s balanced budget and legal maximum appropriation requirements. Implementing, Monitoring and Amending the Budget Phase In July, city staff implement the operating budget and the capital improvement plan, and are accountable for budgetary control throughout the fiscal year. Sources and uses patterns are examined and compared to budget plans and corrective action is taken if necessary. The budget team and department budget liaisons review current expenditure, demographic, economic and financial trends on a monthly basis to ensure the city’s fiscal integrity. City management and the City Council are also provided quarterly operating budget financial updates and reports disclosing actual revenue, expenditure and fund balance performance, as well as quarterly CIP budget updates. A monthly financial report is also presented to Council. Scottsdale’s programs and services are periodically reviewed to determine if they are achieving the City Council’s broad goals, accomplishing strategic objectives and making efficient use of limited resources. Two employee values, “thoughtful innovation” and “accountable integrity,” along with city manager directed studies of several programs during the next budget year help communicate this expectation. The City Treasurer’s Office staff, other charter officers, department directors, and the internal audit staff all aid in the review of programs. City staff from all programs are expected to conduct self-assessments and develop cost and quality measures of efficiency and effectiveness. Internal performance measurements are developed, reviewed and reported on quarterly. Scottsdale’s culture and the employee values of “dedicated service”, and ”collaborative teamwork” stress the importance of open communication and stakeholder involvement in determining satisfaction with programs. Ongoing monitoring of the city’s financial performance is required monthly by the City Charter. Written budget to actual expenditure variance reports must be submitted monthly by all city departments explaining any significant variances (where previous months recorded sources and uses are above or below the budget) and provide a solution for corrective action. Additionally, the departments must be able to explain in writing to the Budget Division the projected year-end budget savings and/or fund balances. The City of Scottsdale’s operating budget is adopted at the fund and department level, and the capital improvement plan is adopted at a project and fund level. The City Council must give prior approval to change the operating budget of a department/fund, to a capital improvement project, or to utilize any contingency appropriation. 68 Table of Contents OVERVIEW | Budget Development Process BUDGET DEVELOPMENT PROCESS 69 Table of Contents OVERVIEW | Budget Development Process USE OF CONTINGENCY/RESERVE FUNDS Contingency/Reserve Funds are strictly defined in the city’s financial policies, are adopted by the City Council annually, and are used in the following instances:  When additional funds are necessary to offset unexpected expenditure increases, so that service levels can be maintained;  When unanticipated grants are received; or  When unanticipated and/or inadequately budgeted events threaten the public health or safety. Use of Contingency/Reserve Funds is to be utilized only after all alternative budget funding sources and other options have been fully considered. All Contingency/Reserve Fund requests require a written justification and an explanation of the fiscal impact, which is reviewed and approved in writing by the department director, budget director, city treasurer, the applicable city charter officer and city manager before being presented to the City Council for consideration in a public meeting. BUDGETARY AND ACCOUNTING BASIS Scottsdale’s budget is prepared on a basis consistent with Generally Accepted Accounting Principles (GAAP). The city’s governmental funds consist of the General Fund, Special Revenue Funds, Debt Service Funds, Permanent (Grant) Funds and Capital Project Funds. Governmental fund budgets are developed using the modified accrual basis of accounting. Under the modified accrual basis, revenues are accrued if they are earned and will be collected within the 31-days after the fiscal year-end. Principal and interest on general long-term debt is budgeted as expenditures when due, whereas other expenditures are budgeted based on the timing of the receipt of the good or service. Enterprise fund budgets – Water and Water Reclamation, Solid Waste, Aviation and Internal Service Funds – are adopted using the full accrual basis of accounting, whereby revenue projections are developed recognizing revenues earned in the period. Expenditure estimates are developed for all expenses incurred during the fiscal year. The major differences between the budget and the Annual Comprehensive Financial Report (ACFR) are:       Certain revenues, expenditures and transfers are not included in the budget, but are accrued and reported in the ACFR. For example, increases or decreases in compensated absences, payroll accruals and changes in fair market value are not included for budget purposes, but are presented in the ACFR. Franchise fees charged to the Enterprise Funds are accounted for as transfers-in or transfers-out in the budget, but are recorded as revenues and expenses in the ACFR. Capital outlays in the Enterprise Funds are presented as expenses in the budget, but are recorded as assets along with associated depreciation expenses in the ACFR. Debt service principal payments in the Enterprise Funds are expenses in the budget, but reported as reduction of long-term debt liability in the ACFR. Certain debt service principal and interest payments are accounted for as operating expenditures in the General Fund for the budget, but are reported as debt service expenditures in the ACFR. For budget purposes the Risk Management Fund presents claim expenditures on a short-term basis while in the ACFR, the claim expenditures also include a long-term accrual for “incurred, but not reported” (IBNR) claims. All actual amounts in the budget document are shown on the budgetary basis to facilitate meaningful comparisons. Budgeted funds include the General, Special Revenue, Debt Service, Enterprise, Internal Service, Grants and the Capital Improvement Plan. OPERATING AND CAPITAL BUDGET RELATIONSHIP The City of Scottsdale’s FY 2025/26 Adopted Budget comprised of three volumes: Volume One – Budget Summary includes the City Council’s mission statement and broad goals, the city manager’s transmittal letters, the signed budget adoption and property tax levy ordinances, final state forms, executive summary and adopted financial policies. Volume One also contains a budget by fund section, which includes five-year financial forecasts that cover the period FY 2025/26 through FY 2029/30 . This section also provides five-year historical summaries for sources and uses by fund. 70 Table of Contents OVERVIEW | Budget Development Process Volume Two – Department Operating Budget contains descriptions of services provided by each department , staffing summaries, operating budgets by expenditure category and the applicable funding sources, current fiscal year objectives, as well as prior year achievements, significant changes and performance measures. In addition, department operating budgets and their relationship with the broad goals and the general plan are included. Volume Three - Capital Improvement Plan includes the Capital Project Budget and Five-Year Capital Improvement Plan with detailed information for each project. Capital project funding sources are matched with budgeted expenditures. Future year projected operating impacts are also included. Finally, there is an appendix which includes a list of acronyms and a glossary. Governmental accounting procedures and state law require expenditures for the five-year capital improvement plan to be budgeted at an amount sufficient to pay for an entire contract, meaning the legal authority is available and appropriated in the period in which a contract is entered by the city. Therefore, capital expenditures are presented on a budget basis reflecting the total appropriated amount as opposed to a cash flow basis, which may take several fiscal years to be paid out. For example, a 180-day construction contract entered in May of fiscal year one would have cash expenditures from May of fiscal year one through October of fiscal year two. However, the entire budget for this contract must be appropriated in fiscal year one, the year in which the contract was entered; any unspent funds at the end of fiscal year one would be carried forward and re-budgeted in fiscal year two. Funding sources for the five-year capital improvement plan are presented on a budget basis, except for cash transfers from the operating budget, which are presented on a purely cash basis. These resources are presented in the period that the cash funding will be transferred to provide continuity between the operating budget and the Capital Improvement Plan. As a result of presenting the cash transfers in on a purely cash basis, the funding sources may not equal the budgeted expenditures in each period, creating a fund balance as cash accumulates each year for planned larger capital expenditures in later fiscal years. For further information regarding capital project funding sources and uses, refer to Volume Three. FIVE-YEAR FINANCIAL PLAN The city’s five-year financial planning process is a year-round process, which lays the groundwork for the proposed budget. The budget process begins in the early fall with the Budget Division ’s initial update of the five-year financial plan for each of the city’s major funds. Staff review the five-year financial plans for the following funds that appear in the budget – General, Ambulance Services, Transportation, Preservation, Parks & Preserve, Special Programs, Tourism Development, Stadium Facility, Special Districts, Debt Service, Water and Water Reclamation, Solid Waste, Aviation, Fleet, PC Replacement, Risk Management, Healthcare Self Insurance and Capital Funds. Using the latest fiscal, operational and legislative information, staff work collaboratively with city departments to update the forecast for the current fiscal year and to create a forecast for the coming budget year. The forecast serves as the basis for the development of the city’s proposed five-year financial plan. In April-May, the city manager provides the City Council and Budget Review Commission with the updated proposed five-year financial plans for their review and consideration. Staff work with the City Council to review the underlying assumptions and reasonableness of the plans. The proposed plans include the budget for the coming year (i.e., the first year of the plan) and subsequent years of the five-year financial forecast period. This time is also used to identify future service and financial issues requiring attention during the budget planning process. The five-year financial plans provide the City Council, Budget Review Commission, city management, residents and municipal bond rating agencies with the benefits of a long-term financial perspective of revenues, expenditures, cash transfers in/out, fund balances and capital financing options. They also serve as the basis to test the potential impacts of proposed policy and operational modifications and pending legislative changes all intended to avoid subjecting residents to wide or irregular fluctuations in rates/fees and service levels. Proposed future operating impacts of capital projects are also included in the forecast, which facilitates the planning, integration and timing of the capital projects into the city’s five-year financial plans. The City Council and city management use the plans to assess the impact of their proposed decisions on a long-range financial context. These decisions may include the proposed addition of new staff, new debt issuances and debt refunding, tax rate changes, the desire to create, modify or eliminate rates/fees, new or expanded services and state legislation changes. Based on the fiscal impact of these decisions, the City Council has an opportunity to modify the proposed plans. 71 Table of Contents OVERVIEW | Budget Development Process As noted above, the development and update of the five-year financial plans is a year-round process. Staff monitor the budget monthly and adjust the estimated annual revenues and expenditures based on the latest economic information, legislative changes and City Council priorities. Revenue and expenditure variances with prior year comparison are reported monthly and CIP budget reported quarterly to the City Council, city management and other stakeholders via Financial Update and Financial Report. Staff monitor and identify changes in the financial and economic climates and consider solutions to negative trends, thereby preserving the financial health of Scottsdale. REVENUE FORECASTING The City of Scottsdale uses both qualitative and quantitative methods for forecasting revenues by blending various techniques to develop conservative and prudent revenue projections. Qualitative revenue forecasting methods used by staff to develop multi-year financial plans include consensus, judgmental and expert forecasting, while trend analysis is used as a quantitative technique. This balanced approach to revenue forecasting is aligned with the Government Finance Officers Association (GFOA) recommendation since research shows that forecasting accuracy is improved by combining qualitative and quantitative techniques. According to the GFOA, each method by itself has inherent weaknesses: qualitative methods can be too subjective at times and may be dependent on wishful thinking and selective perception on behalf of the forecasters; quantitative methods may fail to consider changing conditions inside and outside a jurisdiction and tend to discount important historical events. By combining both methods, forecasters integrate judgmental assumptions within the forecasting framework to produce more realistic revenue projections. To enhance the revenue forecasting process and gain a broader input into the planning process, the Budget division works collaboratively with city departments throughout the year to prepare the revenue estimates. This multi-disciplinary approach and continual reassessment promotes collaboration between the central Budget staff and the department field staff, which reduces the likelihood of miscommunications in formulating the revenue estimates. The field staff’s participation in the revenue estimate forecasts also increases their ownership and accountability for achieving the proposed plan. EXPENDITURE AND YEAR-END SAVINGS FORECASTING Each month throughout the fiscal year, Budget staff works with city departments to monitor year-to-date actual expenditures against the year-to-date approved budget and prior year actual expenditures. Each department is also expected to forecast their year-end expenditures and related savings. All significant actual or forecasted variances are researched and a reason for the likely variance as well as possible ways to resolve the variance are considered by staff. Proactive management of the budget to actual/forecasted expenditures allows staff the opportunity to promptly notify city management and the City Council of potential budget concerns. 1 Recommended budget practices: A framework for improved state and local government budgeting national advisory council on state and local budgeting government finance officers association. (1999). https://gfoaorg.cdn.prismic.io/gfoaorg/e4534548-fa06-47ad-9cc85f37e6e2f21e_RecommendedBudgetPractices.pdf 2 Office of the Arizona Auditor General. (2021). FAQs—Cities and Towns. Arizona Auditor General. https://www.azauditor.gov/reports-publications/citiesand-towns/faqs 72 Table of Contents OVERVIEW | Budget Calendar BUDGET PLANNING AND DEVELOPMENT FISCAL YEAR 2025/26 CALENDAR Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Strategic Planning Process Collect Citizen Input Develop Broad Goals & Strategic Directives Conduct Needs Assessment Develop Financial Trends & Forecasting Assumptions Forecast Multi-Year Revenues Update Financial Policies Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Capital Improvement Plan Budget Process CIP Kick-off Submission of new/amended capital projects Cross-departmental Review Capital Management Review Committee Operating Impacts Review Budget Review Comission Proposed/Tentative/Final Budget Public Hearings Final Adoption Implement Adopted Budget Monitor Citywide Financial Performance Budget Process Review & Adjustment Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Operating Budget Process Operating Budget Kick-Off Internal Service Rates Finalized Department Budget Development Department Budget Requests Submission Update Performance Measurements Line Item Review City Management Budget Review Budget Review Comission New Rates & Fees Proposed Finalize Proposed Five-Year Financial Plans City Council Review Proposed/Tentative/Final Budget Public Hearings Final Budget Adoption Implement Adopted Budget Monitor Citywide Financial Performance Budget Process Review & Adjustment 73 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance Comprehensive Financial Policies The City of Scottsdale’s (city) mission is to provide simply better service for a world-class community. A vital component to achieving this mission is to carefully account for public funds, to manage finances wisely, and to plan for the adequate funding of services desired by the public, including the provision and maintenance of public facilities. These Comprehensive Financial Policies (Policies) establish the standards for stewardship over the city’s financial resources and provide guidance for sound fiscal planning, budgeting, accounting, and financial reporting to support the city’s mission and financial goals. The city’s financial goals are broad and represent the financial position the city seeks to attain:     To deliver quality services in an affordable, efficient, and cost-effective basis providing full value for each tax dollar. To maintain an adequate financial base to sustain a sufficient level of municipal services, thereby preserving the quality of life in Scottsdale. To have the ability to withstand local and regional economic fluctuations, to adjust to changes in the service requirements of our community, and to respond to changes in Federal and State priorities and funding as they affect the city's residents and business owners. To maintain high bond credit ratings to ensure the city’s access to the bond markets and to provide assurance to the city's taxpayers that the city government is well managed and financially sound. All departments will participate in the responsibility of meeting policy goals and ensuring the long-term financial health of the city. Future service plans and program initiatives will be developed to reflect current policy directives, projected resources, and future service requirements. These Policies are adopted by council resolution each year. By their nature, policies must change and evolve over time as the city grows and to respond to changes in law, new industry standards, or best practices. Accordingly, these Policies will be subject to annual review and recommendation for revisions, if any, will be presented to the Scottsdale City Council (council) for approval. In addition to these Policies, the city maintains internal Administrative Regulations (AR) to provide city manager directives for staff, where necessary. ARs are written orders or directives issued by the city manager intended to articulate citywide policies and procedures. These are referenced throughout these Policies, where applicable. Policy 1 Fiscal Planning and Budgeting Fiscal planning refers to the process of identifying resources and allocating those resources among numerous and complex competing purposes. A key tool for this planning is the preparation, monitoring, and analysis of the city’s budget. The purpose of this policy is to provide guidance on the city’s budget process and development to ensure sound financial management and application of best practices in budgeting and fiscal planning. Accompanying the Policies are a set of budget governing guidance which provides direction for allocating certain annual city resources through the budget process to meet council priorities and goals. These guidelines are attached as Appendix A Budget Governing Guidance. 1.01 Budget Period. The city will budget revenues and expenditures for all funds on a fiscal year basis which begins July 1 and ends on the following June 30. 1.02 Budget Adoption. Pursuant to Article 3, Section 2 and Article 6, Sections 3 and 5 of the Scottsdale City Charter, the city manager shall submit to the 74 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance council a proposed annual operating budget and five-year capital improvement plan. The full council will solicit resident input and review the operating and capital budget recommendations from a department, program, and goals perspective. The council shall adopt the budget for the following fiscal year at the first regular meeting in June. 1.03 Budget Basis. The annual operating budget and five-year capital improvement plan will be prepared on a basis consistent with Generally Accepted Accounting Principles (GAAP)1 whereby Governmental Funds (General Fund, Special Revenue Funds, Debt Service Funds, and Capital Project Funds) are budgeted on a modified accrual basis and Proprietary Funds (Enterprise Funds and Internal Service Funds)1 are budgeted on a full accrual basis except for the following: expenditure estimates and reserve requirements for the city’s primary funds. The five-year forecast will identify revenues and expenditures that are anticipated to be sustainable over the five-year period. The five-year forecast will be updated annually and provided to executive leadership during the city’s budget process. 1.06 Expenditure Limitation Review. The city shall ensure that its expenditures adopted through the annual budget process are below the expenditure limitation established by the state. At a minimum of every five years, the city treasurer shall report to the council the expenditure limitation capacity of the city. In the event that projections through the budget process result in the city reaching or exceeding ninety percent (90%) of the expenditure limitation, the city treasurer/chief financial officer shall provide council with formal notification and recommendations for council action. 1.07 Balanced Budget. The budget shall be considered balanced if all sources of revenue, as estimated, are equal to, or exceed, the total of amounts proposed to be used in the operating budget for the current fiscal year, by fund. To the extent unencumbered balances from the preceding fiscal year are required to achieve a balanced budget, use of unencumbered balances from the preceding fiscal year will be only as authorized by council. The budget will not use one-time (nonrecurring) sources to fund continuing (recurring) uses or use external borrowing for operational requirements. The budget will incorporate the best available estimates of revenues and expenditures. 1.08 Cost Allocation. The city shall establish an indirect cost allocation plan to determine the administrative service and other indirect staff support provided to departments, programs, and funds. Administrative costs incurred in the General Fund to support operations of the Enterprise Funds (Water, Wastewater, Solid a) Amortized lease revenues and associated b) c) d) e) 1.04 1.05 interest Payroll accruals and accrued compensated absences Change in fair value of investments Depreciation and amortization expenditures Long-term revenue and expenditure activity Alignment with Goals and Performance Measurement. The budget will be developed in accordance with council’s established goals and priorities, the needs of the community, and local, state, and federal laws. Performance management will be utilized to align council goals and organization strategic efforts. The annual budget will include department goals, objectives, and performance measures to show that intended goals and objectives are achieved in an efficient and effective manner. Long-Range Financial Forecasts. To promote long-term strategic thinking and demonstrate the city’s ability to adapt to changes in the economy, operating requirements, and capital demands, the city will prepare a balanced five-year financial forecast that will incorporate both revenue and GAAP and fund types are all defined by the Governmental Accounting Standards Board (GASB) as defined by the Statements of Governmental Accounting Standards. 1 75 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance Waste, and Aviation) will be recovered through the indirect cost allocation plan. 1.09 1.10 1.11 1.12 Contingency. The city’s annual budget will include contingency appropriations to provide for unanticipated increases in service delivery costs and unexpected needs that may arise throughout the fiscal year. Use of contingency appropriation will require identifying a funding source and should be utilized only after all budget sources have been examined for available funds. The contingency appropriation can only be expended upon separate council approval. Budget Control. The city shall establish appropriate management controls to monitor expenditure budgets to ensure they do not exceed authorizations. For operating budgets, this control shall be exercised at the department/fund/general account classification level. The general account classification consists of personnel and non-personnel categories. For capital budgets, the budgetary control shall be exercised at the project level. See Policy 3 Expenditure Management for further policy guidance on budget controls. Budget Amendments. The city can amend appropriations for line items, funds, projects, or departments if total expenditures do not exceed the final appropriation budget adopted by council. Requests for amendments within the same department, fund, and general account classifications must be approved by the department’s executive director or equivalent and the city’s budget director. Pursuant to Article 6, Section 11 of the Scottsdale City Charter and as clarified by these Policies, amendments requiring the transfer of contingency appropriation or the transfer of appropriation between funds, departments, general account classifications, and capital projects can be made at the direction of the city manager subject to council approval. fiscal year on hiring, promotions, transfers, capital equipment purchases, and capital projects. Such action will not be taken arbitrarily or without knowledge of the council. 1.12 Unspent Appropriations. Unspent appropriations for programs and major projects may be considered for re-appropriation in the subsequent fiscal year. Such carryover of appropriation shall be included in the proposed budget to be authorized by the council. 1.13 Distinguished Budget Award. The city will prepare a budget in accordance with the Government Finance Officers Association policies and best practices established by the “Government Finance Officers Association Distinguished Budget Award” program. Staff will submit the budget document to the Government Finance Officers Association each year for review in the award program. Policy 2 Reserves and Fund Balance Maintaining adequate reserves is critical to ensure the city’s financial stability through economic downturns, catastrophic events, natural disasters, and other unforeseen emergencies and events. Adequate reserves are also essential in preserving the city’s high bond ratings and achieving the city’s financial goals. The purpose of this policy is to establish reserve targets and fund balance, the conditions under which the reserves and fund balance may be spent, and the method by which the reserves and fund balance will be restored. Reserves should only be used after all other budget sources have been examined. 2.01 Budget Deficit. If a deficit is projected during the fiscal year, the city will take steps to reduce expenditures or increase revenues before considering using fund balance or reserves. The city manager may institute a cessation during the 76 General Fund Operating Reserves. The General Fund is the city’s main operating fund that pays for public safety, community services, parks, libraries, and other general city operations. The General Fund is considered to have a high level of risk due to its dependence on economically sensitive revenues. The General Fund is the main funding source when responding to city-wide emergencies and unexpected events. In consideration of these risks and other driving factors, the city will maintain an “Operating Reserve” in the General Fund of 20 percent of Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance operating uses, excluding transfers out, to provide stability and flexibility to respond to unexpected events. The reserve is intended for unexpected events (such as a significant unexpected loss of revenues, unexpected mandates, or large-scale emergencies) whose impact is significant. Use of this reserve requires council approval and must be replenished to the required General Fund Operating Reserve policy level of 20 percent within the next two fiscal years following the fiscal year in which the funds were used. 2.02 2.03 2.04 General Fund Emergency Reserves. The city will maintain an “Emergency Reserve” in the General Fund of 5 percent of operating uses, excluding transfers out. The reserve is intended for unexpected emergencies and events where immediate action must be taken in the best interest of the city’s residents and business owners. Use of reserves must be appropriated by council action. However, the city manager may approve the use of this reserve in the event that immediate expenditure of funds is needed to protect the health, safety, and welfare of the city. When this occurs, the city manager will provide a report for council approval as soon as practical on the usage of these funds. The city will strive to restore the reserves to the required General Fund Emergency Reserve policy level of 5 percent within the next fiscal year following the fiscal year in which the funds were used. Transportation Fund Operating Reserves. The city will maintain an “Operating Reserve” in the Transportation Fund of 10 percent of operating uses, excluding transfers out, to provide funding to deal with fluctuations in economic cycles and unexpected one-time operating requirements. Use of this reserve requires council approval, and the city shall strive to restore the reserves to the required Transportation Fund Operating Reserve policy level of 10 percent within the next two fiscal years following the fiscal year in which the funds were used. Park and Preserve Tax Revenue Stabilization Reserve. The city will maintain a “Revenue Stabilization Reserve” in the Park and Preserve Tax Funds of 20 percent of operating uses, excluding transfers out, to provide funding to deal with fluctuations in economic cycles. Use of this reserve requires council approval, and the city shall strive to restore the reserves to the required policy level of 20 percent within the next two fiscal years following the fiscal year in which the funds were used. 2.05 Enterprise Fund Operating Reserves. Enterprise Funds (Water, Wastewater, Solid Waste, and Aviation) are intended to be self-supporting and not depend on the General Fund to fund operating and capital costs. The city will maintain “Operating Reserves” in its Enterprise Funds as follows to provide for emergencies, unexpected declines in revenues and other unanticipated events. Use of these reserves require council approval, and the city shall strive to restore the reserves to the defined level within the next two fiscal years following the fiscal year in which the funds were used. a) Water and Wastewater Funds - 25 percent of operating uses, excluding transfers out and debt service. b) Aviation Fund - 25 percent of operating uses, excluding transfers out and debt service. c) Solid Waste Fund - 15 percent of operating uses, excluding transfers out and debt service. 2.06 Asset Replacement Reserves. An asset replacement reserve may be considered if needed to provide for the replacement of critical assets. Departments shall identify aging capital assets or develop an asset replacement schedule to determine funding of an asset’s replacement reserve. 2.07 Governmental Debt Service Reserves. The city will maintain “Debt Service Reserves” in the General Obligation Bond Debt Service Fund for secondary property tax supported debt of no more than 10 percent of the amount of annual principal and interest needed to service the outstanding debt. The city will maintain “Debt Service Reserves” for governmental debt 77 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance supported by excise taxes, dedicated taxes, or revenues, at a minimum of 25 percent of the next fiscal year’s debt service. 2.08 Self-Insurance Reserves – Risk Management. The city will maintain “Self-Insurance Reserves” at a level that will adequately fund the city’s financial obligations for the payment of property, workers’ compensation, and general liability losses. A qualified actuarial firm shall be retained on an annual basis to project and develop losses to recommend appropriate reserve levels. The Loss Trust Fund Board’s target is to maintain a minimum Risk Management reserve fund balance equivalent to the actuary’s 80 percent confidence interval of projected total outstanding claims liability. 2.09 Self-Insurance Reserves – Healthcare. The city will maintain “Self-Insurance Reserves” at a level that will adequately fund the city’s financial obligations for the healthcare program. A qualified actuarial firm shall be retained to project liabilities and establish reserve levels. 2.10 Other Reserves and Fund Balance. The city may maintain other reserves or fund balance as deemed necessary to ensure adequate resources to cover future expenditures. 2.11 2.12 2.13 the city treasurer/chief financial officer or designee, to assign fund balance for specific purposes. Policy 3 Expenditure Management Department management is expected to manage their expenditures wisely and to look for efficient and effective ways to deliver services— including alternative means of service delivery—to residents and businesses while meeting council goals. This policy provides guidance and standards to ensure careful management of expenditures in accordance with legal requirements and to ensure sound financial management practices and accountability for public funds. 3.01 Expending Order of Fund Balance. In accordance with Resolution No. 8751 adopted by the council on June 28, 2011, when an expenditure is incurred for purposes for which committed, assigned, and unassigned balances are available, as a general rule, the city will first reduce the committed amounts, followed by assigned amounts, and then unassigned. Commitment of Fund Balance. In accordance with Resolution No. 8751, for committed fund balance, formal action by the city council through resolution is required to establish, modify, or rescind committed fund balance. Such council resolutions must occur before the end of the applicable fiscal year. Assignment of Fund Balance. In accordance with Resolution No. 8751, the city council authorized 78 Operating Expenditure Management. a) Budget Level Control. Operating expenditures will be controlled by an annual appropriated budget at the department/fund level/general account classification. A department cannot spend more than the budget appropriated for the fund, department, and/or account classification unless additional appropriation is approved by council. b) Transfer of Appropriation. In accordance with Article 6, Section 11 of the Scottsdale City Charter, the city manager, subject to approval of the council, may transfer any unencumbered or unrestricted appropriation balance between general classifications of expenditures within a department or fund or from one department or fund to another. c) Mid-year initiatives. Budget related requests for new, ongoing programs initiated outside of the annual budget development process requires approval by the city manager and the related budget authority approved by council. d) Position Control. A system will be used to facilitate position control. The number of full-time and regular part-time employees on the payroll shall not exceed the total number Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance of full-time equivalents (FTEs) authorized by council through the budget process. The budget will identify the resources required to support the authorized staffing. Personnel additions outside of the budget process are discouraged and only accepted when approved by the city manager and the related budget authority is approved by council. e) Health Benefits. Benefits and compensation will be administered in accordance with policy given by council. As part of a costcontainment strategy, total costs for health insurance premiums will be shared between the employer, employees, and public safety disabled retirees. Total premiums will be evaluated on an annual basis to ensure they are reasonable and competitive, and that total premiums are expected to provide adequate funding of anticipated claims and a reasonable level of loss reserves. 3.02 Capital Expenditure Management. a) Capital Improvement Plan (CIP). The CIP is a planning and fiscal management tool used by the city for long-term planning for capital improvements. The five-year CIP will be updated annually, including anticipated spending as well as funding sources, appropriated for each fiscal year. CIP projects are defined typically as multi-year efforts which may include purchases or construction of infrastructure or equipment which results in a new capitalized asset costing more than $50,000 and having a useful life of five years or more. b) Project Review and Selection. Proposed CIP projects will include a detailed project description, identification of need and funding sources, full cost estimates, anticipated time schedule, full operating impacts, and other information necessary for proper evaluation of the city’s investment in, and the ability to fund, the projects. Proposed CIP projects will be reviewed and prioritized by a cross-departmental team to ensure they are consistent with the council goals. c) Funding of CIP Projects. CIP projects must have sufficient budget authority and a funding source identified in the five-year CIP plan to meet the entire amount of the commitment. Future operating and maintenance costs associated with new capital improvements approved by council will be forecasted and included in the operating budget and five-year financial plan. Capital projects will be monitored to ensure that no unnecessary budget appropriation authority exists due to inactivity or upon project completion. Before fiscal year-end, any unspent funding for inactive or completed projects will revert to the fund balance of the funding source. d) Balanced CIP Budget. For each year of the CIP, total anticipated expenditures and commitments will not exceed projected starting fund balance plus total anticipated revenues for that year. e) Pay-as-you-go. The city shall incorporate “pay-as-you-go” funding in the annual CIP. Pay-as-you-go funding should account for a minimum of 25 percent of the CIP for each five-year planning period, except for capital improvement programs funded by voter approved debt where the amount of debt is authorized by voters. Pay-as-you-go funding is defined as all sources of revenue other than city debt issuance, i.e., fund balance, dedicated revenues, contributions, grants etc. f) Approval for Capital Project Cost Increases. Cost increases to capital projects greater than 10 percent and $1.0 million as a result of scope increases or other cost increases require council presentation or a written update to council, and council approval. In unique circumstances, the city manager and budget director, based on additional review, may require council discussion or presentation and council approval for 79 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance increases that do not meet the policy’s threshold of 10 percent and $1.0 million. 3.03 Financial Obligations and Commitments. Departments contemplating entering into financial obligations and commitments for new programs, projects, or services and requiring future budget appropriations over $1.0 million that is not included in the five-year CIP or appropriated budget requires city manager approval and council presentation and approval before entering into the financial obligation or commitment. for Proprietary Fund revenues) will be deposited in the General Fund. 4.05 The city will periodically evaluate the full cost of providing a service for which fees are charged. The calculation of full cost will include all reasonable and justifiable direct and indirect cost components. Policy 4 Revenue Management The revenue management policy establishes the city’s revenue principles and practices for ensuring financial stability and sustainability and achieving the city’s financial goals of maintaining an adequate financial base for municipal services. 4.01 Custody. In accordance with Scottsdale Revised Code Chapter 2 Article IV, Section 2-131, the city treasurer/chief financial officer shall control receipts and have custody of all the money of the city. 4.02 Revenue Collection. The city will maintain effective internal controls and formal procedures to ensure the proper billing, collection, and accounting of all receipts and receivables. The city will vigilantly pursue collecting all revenues, late penalties, and related interest as authorized by the Arizona Revised Statutes and city policies. 4.03 Revenue Base. The city will strive to maintain a diversified and stable General Fund revenue base to shelter it from economic changes or short-term fluctuations by exploring appropriate and allowable sources of revenues for funding programs and projects which may include revenues from assessments, contracts, grants and contributions, taxes, and fees. 4.04 Dedicated Revenues. Revenues will not be dedicated for specific purposes, unless approved by council, required by law, or restricted by an outside party. All non-restricted revenues (except User Fees and Charges. For services that largely or solely benefit individuals, the city shall recover full or partial cost of service delivery through user fees and charges. New fees and fee increases must be approved by council before implementation. 4.06 Fleet and IT Replacement Rates. The use or replacement of Fleet and Information Technology (personal computers, phones, and copier systems) will be accounted for through the use of a direct or a “rental” rate structure. The rates will be revised annually to ensure that charges to operating departments are sufficient for operation and replacement of vehicles and other equipment. Replacement costs will be based upon equipment lifecycle financial analysis. 4.07 Development Impact Fees. Development impact fees, as permitted by state law, for capital expenses attributable to new development will be reviewed periodically with an engineering assessment to ensure that fees recover all direct development-related expenses and be approved by council. 4.08 Unanticipated One-Time Non-Operating Revenues. Use of significant unanticipated onetime, non-operating revenues (except for grants) such as the sale of land, requires council presentation and approval. Policy 5 Grants Management Grant funding will be considered to leverage city funds. This policy provides guidance to ensure careful review of grant opportunities and their fiscal impact, prior to determining whether an application should be made for these grant funds. The city also maintains AR #255, which 80 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance governs the Grant Acquisition and Administration process. #226, which governs Capital Assets: Acquisition, Inventory and Disposal. 5.01 6.01 Maintenance and Replacement Plans. Periodic physical inventories and assessments for all types of capital assets should be conducted to determine the condition, use, repair, and replacement needs of the assets. A multi-year maintenance and replacement plan should be maintained for critical assets. 6.02 Ongoing Funding. The city will establish an ongoing source of funds to provide for and avoid deferral of critical capital asset maintenance, repair, renewal, and replacement needs. 6.03 Fleet and Equipment Reserves. Replacement funds or reserves for certain fleet vehicles, certain computer equipment, and other asset categories will be determined as part of the annual budget process, as deemed necessary, to ensure adequate funding for systematic replacement and operational needs. 5.02 5.03 Grant Application. The city shall apply for only those grants that are consistent with the goals and priority needs of the city. The potential for incurring ongoing costs, including the assumption of support for grant-funded positions from local revenues, and required city funds needed to be used in conjunction with the grant must be considered prior to applying for a grant. Application or acceptance of grants meeting the parameters of AR #255 are subject to council approval. Match Requirements. All grant submittals shall be evaluated by the city treasurer/chief financial officer or designee for any cash match requirements, their potential impact on the operating budget which includes any additional funds needed to carry out the use of the intended grant, and the extent to which they meet the city’s goals. If there are city funds needed to execute the grant, the source of funding shall be identified prior to application. Budget Control. The city should avoid relying on grant funding to support ongoing programs. All grant program initiatives will be evaluated as part of the budget process. In the event of reduced grant funding, or inconsistent and/or fluctuating grants, city resources may be substituted only after all program priorities and alternatives are considered during the budget process. Policy 6 Capital Asset Maintenance and Replacement Proper preventative maintenance, repair, renewal, and replacement are essential to protecting the city’s investment in its capital assets and ensuring the continued performance and use of these assets for the provision of services to our residents. Deferring essential maintenance or replacement can impact service delivery and increase long term costs. This policy provides guidance to ensure a system for assessing capital assets and providing adequate funding for the maintenance, repair, renewal, and replacement of capital assets. The city also maintains AR Policy 7 Cash and Investment Management The city has a fiduciary responsibility over public funds, including the ongoing managing and monitoring of treasury and investment activities. This policy provides guidance and standards of care for the proper management of the city’s cash and investments. The city also maintains AR #268, which ensures a system of internal controls and governs the city’s cash collection, handling, training, and procedures program. 7.01 Investment Policy. The city shall maintain and comply with a separate written Investment Policy that has been approved by the council. The city treasurer/chief financial officer, as chief investment officer, or his/her designee shall invest all funds of the city according to the approved Investment Policy. City funds will be managed in a prudent and diligent manner with an emphasis on safety of principal, liquidity, and financial returns on principal, in that order. The city treasurer/chief financial officer shall provide the council with quarterly investment reports. 81 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance 7.02 7.03 7.04 Management of Funds. The city will collect, deposit, invest, and disburse all funds on a schedule that insures optimum cash flow liquidity and investment of public funds. Bond funds will be segregated from all other funds for arbitrage and accounting purposes. To optimize investment performance, the city will consolidate cash balances from various funds for investment purposes. state, and local laws, and maintaining the city’s high bond ratings. Financial Institutions. The city will conduct its treasury and investment activities with qualified financial institution(s) that have balance sheet strength, high credit quality, and dedicated government operations that can fully serve the city’s complex treasury and investment needs. Arrangements with financial institutions will be based on written contracts. The city and financial institution(s) will adhere to state laws and city code for the proper collateralization of public deposits. a) Appropriate use of debt; b) Financing and funding alternatives; c) Acquisition and construction cash flow Custody of Investments. Ownership of the city’s investment securities will be protected through third party custody safekeeping. Arrangements with third party custodian services will be based on written contracts. 8.01 Evaluation for Issuance of Debt Obligations. The city treasurer/chief financial officer shall evaluate and consider various conditions, including but not limited to the following, when analyzing, reviewing, and recommending the issuance of debt obligations: projections; d) Impact on the General Fund and other operating funds; e) Debt burden on tax base or user fees; f) Availability and sufficiency of pledged revenues for current and future debt service; g) Debt coverage and other ratios, debt security, reserve requirements, and proposed debt covenants. 8.02 Policy 8 Debt Management The city utilizes debt to finance needed capital projects too large to fund with current resources or where the issuance of debt provides financial or economic benefits to the city’s residents and business owners. The issuance of debt obligations (bonds, notes, certificates of participation, capital leases, and other debt instruments) has a significant impact on the city’s finances and must be carefully considered and managed to ensure prudent financial management, mitigation of risks, and preservation of the city’s high bond ratings. This policy provides guidelines for the appropriate uses of debt, establishing debt management goals, ensuring compliance with federal, Conditions for Issuance of Debt Obligations. The issuance of all debt obligations is subject to approval by the city treasurer/chief financial officer and council. In addition, the issuance of debt obligations is subject to but not limited to the following requirements: a) Debt financing shall not be obtained to fund operations. b) Capital projects to be financed should first be developed and approved in accordance with the capital improvement process. c) The city treasurer/chief financial officer will seek input from the city’s external financial advisor, bond counsel and the City of Scottsdale Municipal Property Corporation (MPC)2 Board (if related to MPC debt) carefully consider the debt service structure, timing, terms, and other such matters concerning each debt issuance. The MPC is a non-profit corporation created in 1967 by the city as a financing mechanism for the purpose of financing the construction or acquisition of capital improvement projects for lease to and use by the city. The MPC is governed by a board of directors consisting of citizens from the community approved by the city council. MPC bonds are secured by the city's lease payments which are in turn secured by city excise tax and other undesignated general fund revenues. These bonds may be issued without a vote of the citizens. 2 82 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance d) The debt portfolio’s principal and interest payments should generally be structured to result in level debt service or to align with the useful life of the assets, unless an alternate structure is warranted. Deferral of principal is discouraged. e) The weighted average maturity of the debt issuance should generally be no greater than the reasonably expected average economic life of all the assets being financed. f) Debt proceeds will reasonably be utilized within three years, and in approved circumstances five-years, in compliance with Internal Revenue Service (IRS) regulations. g) Debt obligations must comply with all applicable federal, state, and local laws, regulations, and covenants. 8.03 8.04 Outside Professional Services. The city treasurer/chief financial officer (and city attorney for bond counsel services) shall be responsible for the solicitation, selection, and securing of professional services required to assist the city in the issuance and administration of its debt obligations. The city shall use an external financial advisor on all debt issuances. The external financial advisor will have a fiduciary responsibility to the city, will have the proper experience and qualifications to advise the city, and will comply with all applicable municipal advisor rules and regulations promulgated by the Securities and Exchange Commission (SEC) and Municipal Securities Rulemaking Board (MSRB). The financial advisory relationship will be evidenced through a written contract. The solicitation and selection of outside professionals shall be done in conformance with the city’s procurement code and competitive selection process for professional service contracts. Types of Debt Obligations: General Obligation (G.O.) Bonds. a) G.O. Bonds are voter authorized debt supported by (secondary) property tax revenues. The issuance of G.O. Bonds shall be carefully considered and used only for b) c) d) e) public projects benefitting a broad public interest. Issuances will be managed to match debt issuance proceeds to CIP cash flow requirements. The city will not exceed $1.50 combined (primary and secondary) property tax rate per $100 net assessed limited property value unless otherwise directed by the council. Outstanding G.O. Bonds are limited by the Arizona Constitution to 20 percent of net assessed full cash property value for projects involving water, sewer, streets, transportation, public safety artificial light, parks, open space, and recreational facility improvements, and 6 percent of net assessed full cash property value for any other general municipal-purpose projects. The city will maintain appropriate debt service reserves as stated in Policy 2. Excise Tax/Revenue Secured Obligations. a) Non-voter authorized debt (i.e., MPC, Excise Tax Obligations, Revenue Obligations, and other non-voter authorized debt) will be used only when a dedicated non-property tax source (e.g., excise taxes and utility revenues) can be identified to pay or reimburse the General Fund for paying debt service expenses. b) Issuances will be managed to match debt issuance proceeds to CIP cash flow requirements. c) The General Fund excise tax debt service should not exceed 10 percent of the General Fund’s current or future annual operating revenue in order to control fixed costs and ensure expenditure flexibility. d) The city treasurer/chief financial officer shall perform a five-year analysis of debt coverage and other ratios, debt security, and reserve requirements for each debt issuance. e) Careful consideration of the intended use of the financed facilities, including private activity use, must be evaluated when determining the appropriate debt structure. f) McDowell Sonoran Preserve (Preserve) debt service will be funded by the dedicated 0.15 percent privilege tax. 83 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance g) The city will maintain appropriate Debt Service Reserves as stated in Policy 2. Improvement District (ID) Bonds. a) IDs are a funding mechanism primarily used for existing neighborhoods desiring improvements to public infrastructure that specifically benefit the neighborhood such as street paving, improvements to sidewalks, curbs, gutters, sewers, ditches, drains, offstreet parking, street lighting, undergrounding utility facilities, etc. b) ID bonds, as authorized by state statutes for certain ID improvements, shall not have maturities longer than ten years and are secured by a first lien on the property benefited. ID bonds will be utilized only when it is expected that the debt will be issued for their full term. c) ID debt will be permitted only when the net assessed full cash property value of the district, as reported by the Maricopa County Assessor’s Office, to debt ratio (prior to improvements being installed) is a minimum of 3:1 prior to issuance of debt and 5:1 or higher after construction of improvements. Should the net assessed full cash property value to debt ratio not meet the minimum requirements, property values may be determined by an appraisal paid for by the applicant and administered by the city. c) CFDs should be considered primarily in connection with the financing and funding of major public infrastructure that conforms to council goals, the city’s general plan, infrastructure plans, or capital improvement plans. d) The city treasurer/chief financial officer will carefully assess the proposed financing plan, financial assurances, overlapping tax and financial burden on property owners, and other factors for each proposed CFD formation. e) CFD debt will be permitted only when the net assessed full cash property value of the district, as reported by the Maricopa County Assessor’s Office, to debt ratio (prior to improvements being installed) is a minimum of 3:1 prior to issuance of debt and 5:1 or higher after construction of improvements. f) Voter approval is required for the CFD to issue G.O. bonds. g) The landowner/developer shall also contribute $0.25 in public infrastructure improvement costs for each dollar of public infrastructure improvement debt to be financed by the CFD. 8.05 Community Facility District (CFD) Bonds. a) CFDs are special taxing districts created to provide a funding mechanism to finance construction, acquisition, operation, and maintenance of public infrastructure that benefits real property within the CFD. b) CFDs have statutory taxing and borrowing authority within the city. For that reason, council must fully understand the benefits, potential drawbacks, risks, and legal exposures, to ensure the financial protection of the city and its property owners and taxpayers, and to ensure the success of the CFD, when considering each CFD formation. The city will maintain a separate written CFD policy to establish policy directions, application, and formation procedures. 84 Refunding Bonds. Refunding bonds are issued to retire all or a portion of an outstanding bond issue. Typically, this is done to achieve lower interest costs, reduce debt service payments, or to restructure the debt to meet the city’s goals. When making a determination on refunding bonds, the city treasurer/chief financial officer will consider the following conditions: a) A present value analysis must be prepared to identify the economic effects of the potential refunding. b) For refunding transactions undertaken solely to achieve cost savings, the target net present value savings as a percent of par, shall be at least 3 percent of the refunded par amount, net of transaction expenses, and in excess of $1,000,000. c) Modification of restrictive covenants or existing debt structure to the benefit of the city. Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance 8.06 Investment of Bond Proceeds. The city treasurer/chief financial officer will direct the investment of bond proceeds in accordance with permitted investments for each bond issue and with the city’s separately written Investment Policy. Bond interest earnings will be limited to funding changes to the bond financed CIP, as approved by the city treasurer/chief financial officer or be applied to debt service payments on the bonds issued. The investment of bond proceeds shall comply with all applicable federal, state, and indenture restrictions. 8.07 Use of Bond Proceeds. The city shall not give or loan its bond proceeds to any individual, association, or corporation unless legally authorized and approved by council. 8.08 Lending of City’s Credit. The city shall not loan, give its credit, or guarantee loans for private developers or private party financing arrangements. 8.09 Issuance and Post Issuance Compliance and Continuing Disclosure Undertakings. The city will comply with arbitrage rebate requirements of Internal Revenue Code Section 148 and related Treasury Regulations and shall maintain and comply with separately written procedures for taxexempt bonds (Written Policies Relating to Issuance and Post-Issuance Compliance Procedures for Tax-Advantaged Obligations of the City of Scottsdale, Arizona) to ensure tax-exempt bonds remain in compliance with federal tax requirements. Additionally, the city will comply with Rule 15c2-12 of the Securities and Exchange Act of 1934 adopted by the SEC for reporting significant events and shall maintain and comply with separately written procedures for continuing disclosure compliance (Continuing Disclosure Compliance Procedures Regarding the Securities and Exchange Commission Rule 15c2-12 for the City of Scottsdale, Arizona). Policy 9 Enterprise Funds The city’s Enterprise Fund operations (Water, Wastewater, Solid Waste, and Aviation) are self-supporting operations that generate revenues to fully recover the cost of service. The city invests significantly in its enterprise systems and operations to ensure safe and reliable service to our residents and businesses. This policy provides guidance for the proper management, stewardship, and safeguarding of the Enterprise Fund assets and resources and to ensure financial stability and sustainability of the city’s enterprise systems. Enterprise Funds will comply with all Policies where applicable. 9.01 Enterprise Funds. Separate funds will be established and maintained to properly account for each enterprise operation. Enterprise Funds will not be used to subsidize the operations of other non-Enterprise Funds. Interfund charges will be assessed for the administrative support of the enterprise activity based on a rational nexus between the charges and cost of the benefits received. 9.02 Rates and Fees. The city will establish rates and fees at levels that recover the total direct and indirect costs for operating and capital requirements, including debt service and debt coverage requirements for water, wastewater, solid waste, and general aviation services. All existing enterprise rates and charges will be reviewed annually and developed pursuant to a multi-year financial plan that strives to gradually implement user rate adjustments to avoid acute fluctuations. 9.03 Enterprise Rate Stabilization. In order to ensure long-term stability of the city’s enterprise systems and rates, the city will develop its rates to include future capital needs. In conjunction with debt issuances, funds in excess of reserves and operating requirements will be used to supplement "pay as you go” capital expenditures to avoid significant and unplanned rate adjustments. 9.04 Operating Reserves. The city will maintain “Operating Reserves” in its Enterprise Funds as stated in Policy 2 to provide for emergencies, unexpected declines in revenues, and other unanticipated events. 85 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance 9.05 9.06 9.07 Debt Financing. Debt financing will be used for capital projects too large to fund with current resources and when a debt issuance is affordable and appropriate to facilitate “intergenerational equity,” wherein projects with longer lives are paid over several generations through debt service payments. The Enterprise Funds shall incorporate “pay-as-you-go” funding in the annual CIP. Pay-as-you-go funding should account for a minimum of 25 percent of the CIP, for each five-year planning period. Pay-as-you-go funding is defined as all sources of revenue other than city debt issuance, i.e., fund balance, dedicated revenues, contributions, grants, etc. 10.01 Deposits to the Tourism Development Fund. 100 percent of the bed tax received by the city shall be deposited into the Special Revenue Fund for Tourism Development (Tourism Development Fund). Additionally, the Tourism Development Fund shall receive 100 percent of Princess Hotel lease revenues. 10.02 Debt Coverage Ratio Target. Bond covenants may exist that require maintaining a minimum debt coverage ratio. In order to maintain the city’s high bond rating, the city will recommend rates based on a target debt coverage ratio, net revenues divided by the annual debt service, of at least 2.0 times for Water and Wastewater and 1.5 times for Aviation and Solid Waste. For financial planning purposes, the debt coverage ratios will be calculated with operating transfers and without consideration of capital related transfers and development fee revenues. As approved by council ordinance and in compliance with state law, the annual allocation of the second 50 percent of bed taxes is as follows3: a) Twelve percent for the General Fund; b) Nine percent for tourism-related events and event development; c) Four percent for tourism-related administration and research; d) Twenty-five percent, plus the lease payments on the Princess Resort, or the balance of the remaining Tourism Development Fund revenues, for tourismrelated operating expenses, capital projects and/or operating impacts that are directly associated with tourism-related capital projects, in the form of one-time commitments or multi-year annual commitments, not to exceed $600,000 per commitment unless otherwise approved by council. Enterprise Debt Service Reserves. The city treasurer/chief financial officer may require a Debt Service Reserve for debt supported by dedicated revenues, at a minimum of 25 percent of the next fiscal year’s debt service. Policy 10 Tourism Development Fund The city assesses a 5 percent transient tax for lodging (bed tax) on businesses charging for lodging on a daily, weekly, or any other basis for less than 30 consecutive days. The purpose of this policy is to comply with state law and city elections as well as provide for the proper allocation of the transient tax for lodging in accordance with Scottsdale Ordinance No. 4534. Allocation of Bed Taxes. As approved by the voters, 50 percent of the bed tax revenues shall be used for destination marketing to promote tourism and 50 percent shall be divided among tourism-related event support, tourism research, tourism-related capital projects and other eligible uses as determined by city ordinance and state law. 10.03 Unused Funds. Subject to council approval, at the end of each fiscal year, any unused funds from the second 50 percent as referenced in 10.02 above will be available for use in following years for any of the non-marketing tourism 3 Three percent of the bed tax was grandfathered in and is not subject to the A.R.S. § 9-500.06 restrictions on the use of bed tax funds for the promotion of tourism, and thus is only restricted by city election. 86 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance categories (except the General Fund category) and may be allocated without limitations, except that they may not be leveraged for multi-year annual commitments, such as debt service payments. 10.04 d) Allocation Priority. In the event of a decrease in Tourism Development Fund revenues, debt service is the priority and will be met first. Policy 11 Park and Preserve Tax Funds The city assesses a 0.15 percent transaction privilege and use tax (the Park and Preserve Tax) for maintenance and improvement of city parks and for the maintenance and protection of McDowell Sonoran Preserve (the Preserve) including police and fire security and protection. This policy provides for the proper allocation of revenues collected from the 0.15 percent Park and Preserve Tax in accordance with voter approval and Scottsdale Ordinance No. 4633. 11.01 11.02 Deposits to the Park and Preserve Tax Allocation Fund. 100 percent of the Park and Preserve Tax shall be deposited to the Park and Preserve Tax Allocation Fund. Distributions from the Parks and Preserve Tax Allocation Fund. The annual revenues deposited to the Parks and Preserve Tax Allocation Fund shall be distributed in accordance with Scottsdale Ordinance No. 4633 and in compliance with state law. After debt requirements in section 11.03 are satisfied, all remaining revenues shall be distributed to the respective Park and Preserve Tax Funds as follows: a) b) c) 51 percent to the Parks and Preserve Tax – Park Improvement Fund for city parks improvement needs 18 percent to the Parks and Preserve Tax – Preserve Maintenance Fund for McDowell Sonoran Preserve maintenance and protection needs 14 percent to the Parks and Preserve Tax – Park Maintenance Fund for city parks e) and recreational facilities maintenance (excluding WestWorld) 10 percent to the Parks and Preserve Tax – Fire Fund for Fire Department needs related to parks and the Preserve including, but is not limited to, technical rescue teams for the Preserve and city parks and for fire fuel mitigation around the Preserve and in and around the city for the protection and maintenance of the Preserve and city parks 7 percent to the Parks and Preserve Tax Police Fund for city park rangers and security needs for city parks and the Preserve 11.03 Distribution for Debt Service. Debt may be used to fund certain capital improvements for WestWorld in accordance with financial policies. Notwithstanding Section 11.02 above, on an annual basis, the Park and Preserve Tax revenues will be used to satisfy any debt requirements as required by bond covenants. Debt requirements will be limited to no more than $4,500,000 of the Park and Preserve Tax revenues on an annual basis. 11.04 Fund Balance in Park and Preserve Tax Funds. At the end of each year, any unused park and preserve tax revenues in each respective Park and Preserve Tax Fund will be carried forward for use in future years within that fund. 11.05 Annual Report. The city treasurer/chief financial officer will prepare an annual accounting of the Park and Preserve Tax Funds for city council. Policy 12 Economic Development The city may utilize public funds to encourage private development projects that have a direct benefit to the city, subject to state law and Scottsdale City Charter restrictions. The city strives to expand and diversify its economic base by attracting, retaining, and expanding targeted industries to the city as identified in the city’s Economic Development Strategic Plan. The purpose of this policy is to provide guidance on the use of public funds in 87 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance economic development to focus on job opportunities and other community benefits that diversify and strengthen the local economy and align with the Scottsdale General Plan. 12.01 Compliance with State Law and the Scottsdale City Charter. Use of public funds in development agreements and contracts for economic development shall be applied consistent with state law and the Scottsdale City Charter and prove to have a clearly identified public purpose and direct benefit to the city. 12.02 Evaluation of Costs and Financial Impacts. Development agreements and contracts for economic development will be carefully evaluated for financial and cost impacts to the city by the city treasurer/chief financial officer and city manager or designees. Such costs and financial impacts will be forecasted and included in the operating budget, five-year financial plan, and/or the Capital Improvement Plan. 13.01 Mitigation of Risks. The city shall make diligent efforts to prevent or mitigate the loss of city assets and to reduce the city's exposure to liability claims through ongoing risk assessments, training, safety reviews, loss prevention, and the transfer of risk when prudent. 13.02 Self-Insurance. The city has elected to manage its exposure to risk, and third-party liability claims through self-insurance, in addition to purchasing excess workers’ compensation, property, and casualty insurance. 13.03 Risk Exposure Controls. The city will utilize additional risk control measures to further control its exposure to risk. Measures include, but are not limited to, hold harmless provisions, indemnification language, and in many cases requiring contractors or vendors to procure additional insurance to address the various exposures presented to the city by their activities. 12.03 Restricted Use of Public Funds for Economic Development. The city shall not give or loan its credit in aid of, nor make any donation, grant, or payment of any public funds, by subsidy or otherwise, to any individual, association, or corporation except where there is a clearly identified public purpose and the city either receives direct consideration substantially equal to its expenditure or provides direct assistance to those in need. 13.04 Self-Insurance Reserves. Financial reserves shall be maintained at a level which, together with any excess insurance, will adequately protect the city’s assets and defend its elected officials, officers, and directors against financial loss. The Risk Management Department relies on an annual actuarial study to identify probable losses and is used as a basis for determining self-insurance fund balances based on historical loss data. See Policy 2 for additional information. Use of public funds for economic development shall be in accordance with council’s established goals and priorities and subject to council approval. 13.05 Annual Report. Each year, the Risk Management Department will prepare an annual report depicting a summary of the revenues and expenses received in relation to the workers’ compensation, property, and casualty program for the fiscal year. Policy 13 Risk Management Risk management has become increasingly important to guard against economic loss and ensure public safety in a time of increasing public liability and litigation. This policy outlines how risk management is an ongoing process of identifying, assessing, and prioritizing of risks, followed by the application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events. 13.06 Cost Allocations. Cost allocations to various funds will be based on an analysis of contributing factors, such as claims experience, reserve requirements, cost of risk management, and mitigation, etc. 13.07 Liability Tort Settlements and Judgments. Annually, the city shall include liability tort settlements and judgments authorized by the State of Arizona’s Property Tax Oversight 88 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance Commission into the primary property tax creating a reimbursement revenue to the Risk Management Fund. Policy 14 Accounting, Auditing, and Financial Reporting Accounting, auditing, and financial reporting form the foundation for financial transparency and accountability. This policy provides guidance on the city’s accounting, auditing, and reporting functions to ensure timely, accurate, and comprehensive information is provided to the council, management, residents, investors, creditors, and other interested parties. 14.01 Financial Records. The city treasurer/chief financial officer maintains the official financial records of the city, to include the general ledger, the city’s budget documents, debt-related documents, etc. 14.02 Compliance. The city’s accounting and financial reporting systems will be maintained in conformance with all state and federal laws, General Accepted Accounting Principles (GAAP), and standards of the Governmental Accounting Standards Board (GASB). 14.03 Internal Controls. A system of internal accounting controls and procedures will be maintained to provide reasonable assurance of the safeguarding of assets, the proper recording of financial transactions of the city, and compliance with applicable laws and regulations. 14.04 Monthly Financial Reports. The city treasurer/chief financial officer shall issue timely monthly financial reports to council in accordance with the Scottsdale City Charter. 14.05 Audit. Prior to the end of the fiscal year, the council shall designate certified public accountants who shall perform an independent audit of the city’s financial statements in accordance with generally accepted governmental auditing standards. The certified public accountants shall be independent of the city government, having no personal interest, direct or indirect, in the fiscal affairs of the city government or any of its officers. The certified public accountants shall submit their reports to the council. All such audit reports shall be a matter of public record. 14.06 Annual Financial Report. The city will prepare an Annual Comprehensive Financial Report (ACFR) in accordance with the principles and guidelines established by the Government Finance Officers Association “Certificate of Achievement for Excellence in Financial Reporting” program. Staff will submit the ACFR each year for review in the award program. 14.07 Expenditure Limitation Report. The city treasurer/chief financial officer will prepare an Annual Expenditure Limitation Report (AELR) and submit the AELR each year to the State Auditor General in accordance with A.R.S. § 41-1279.07. Policy 15 Pension Funding An adequately funded pension plan not only provides assurance to employees but also achieves taxpayer and member intergenerational equity by not placing an unfair burden on future taxpayers and members. This policy provides guidance for pension funding to ensure the city maintains adequate assets to fund benefits payable in its pension plans. 15.01 Annual Required Contributions. The city shall fund the full amount of the Annual Required Contribution (ARC) each year as determined by the actuarial valuation report for its defined benefit contribution plans. The ARC is the amount necessary to be contributed by an employer to adequately fund a public pension plan. 15.02 Funding Policy. The city shall maintain and comply with a separate written pension funding policy for its Public Safety Personnel Retirement System that is approved by the council annually in accordance with A.R.S. § 38-863.01. 15.03 Funding Status. It is the intent of the city to maintain adequate assets to fund benefits payable 89 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance in its defined benefit plans. In the event the funded status falls to an unacceptable level, the city shall strive to make additional contributions above the ARC to restore the funded status to an acceptable level. 15.04 Use of Debt. Pension obligation bonds add a level of risk that should be analyzed thoroughly, and the city shall not rely on pension obligation bonds to reduce unfunded pension liabilities. 90 Table of Contents OVERVIEW | Adopted Comprehensive Financial Policies and Governing Guidance Appendix A Budget Governing Guidance The following represents budget governing guidance which provides direction for allocating city resources to fund operating or capital expenditures. The below guidance may be changed during the annual budget process to respond to council priorities or to better align resources with operating or capital needs as recommended by the city manager and city treasurer/chief financial officer. Changes to the below guidance must be approved by the council through the budget process. 1) Funding for General Fund CIP. a) 25 to 50 percent of the unrestricted portion of construction privilege tax revenues. b) 100 percent of General Fund interest earnings. c) Any additional funding as recommended through the budget process. 2) General Fund Operating Surplus. Year-end General Fund operating surpluses not needed to restore contingency, reserves, or designations or to cover unforeseen shortfalls in the budget will be considered for one-time operating needs or transferred to the General Fund CIP in the following fiscal year’s budget development process. 3) Funding for Public Safety Accidental Disabled Retirees. A General Fund transfer will be made to the Benefits Healthcare Self-Insurance Fund to subsidize the cost of providing healthcare benefits to sworn public safety accidental disabled retirees. 4) Transportation Fund Operating Surpluses. Year-end Transportation Fund operating surpluses not needed to restore contingency or reserves or to cover unforeseen shortfalls in the budget will be considered for one-time operating needs or transferred to the Transportation Fund CIP in the following fiscal year’s budget development process. 5) Allocation of Dedicated 0.2 Percent Transportation Privilege Tax. No less than 50 percent of the dedicated 0.2 percent privilege tax revenue for transportation improvements will be allocated to the capital budget for planning, design, construction, and acquisition costs associated with building, renovating, or enhancing capital projects for streets, highways, traffic control, and transit. 91 Table of Contents OVERVIEW | Fund Accounting - Fund Types Fund Accounting segregates functions and activities into separate self-balancing funds that are created and maintained for specific purposes. This approach is unique to the government sector. To ensure legal compliance and financial management for the various restricted revenues and program expenditures, the city’s accounting and budget structure is segregated into various funds. A fund is a group of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The city, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. General Fund is the primary operating fund of the city. It Internal Service Funds are used to account for the Special Revenue Funds are used to account for the Grant Funds are used to leverage city funds to address exists to account for the resources devoted to finance the services traditionally associated with local government. This includes essential services such as police and fire, parks and recreation, planning and economic development, general administration of the city, and any other activity for which a special fund has not been created. Activity related to the Ambulance Service program is reported separately in the Ambulance Service Fund. financing, on a cost-reimbursement basis, of commodities or services provided by one program for the benefit of other programs within the city. The city maintains Internal Service Funds to account for Fleet Management, PC Replacement and Self Insurance activities. proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. The city maintains the following six Special Revenue Funds: Transportation, Tourism Development, Park and Preserve Tax, Preservation, Stadium Facility, and Special Programs. priority program and service needs. Debt Service Fund is used to account for the Special Districts Fund is used to account for the Enterprise Funds are used to account for operations, including debt service, which are financed and operated similarly to private businesses, where the intent is that the service is self-sufficient, with all costs supported predominantly by user charges. The city maintains three Enterprise Funds to account for Water and Water Reclamation, Solid Waste, and Aviation activities. Capital Improvement Plan Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities. The city maintains several Capital Improvement Plan Funds to ensure legal compliance and financial management for various restricted and unrestricted revenues. accumulation of resources and for the payment of general long-term debt principal and interest. It does not include contractual obligations accounted for in the individual funds. 92 city’s streetlight districts. Table of Contents Total Budget Overview BUDGET BY FUND | Total Budget Overview Budget by Fund Adopted Budget $2,203.7 Million (a) Operating Budgets $863.8M (a) (b) Capital Improvement Plan $947.7M Contingencies / Reserves $370.8M General Fund (b) $469.9M Grant Funds $20.8M Community Facilities $93.3M General Fund $182.1M Special Revenue Funds $90.0M Special Districts Fund $0.6M Drainage / Flood Control $37.5M Special Revenue Funds $35.1M Debt Service Fund $78.6M Preservation $11.8M Debt Service Fund $8.7M Enterprise Funds $199.3M Public Safety $78.4M Enterprise Funds $67.4M Service Facilities $151.6M Internal Service Funds $47.0M Transportation $251.8M Grant Funds $4.0M Water Management $323.3M Capital Improvement $26.5M Internal Service Funds $ 26.0M (a) (a) Grants & Special Districts $21.4M Adopted Budget and Operating Budgets include Internal Service Funds offsets (reductions) of $84.3M Includes Ambulance Service Fund Rounding differences may occur. 93 Table of Contents BUDGET BY FUND | Total Budget Overview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able of Contents BUDGET BY FUND | Total Budget Overview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he FY 2026/27 fund balance increases to $7.0 million due to rolling over to funds for CIP projects planned for FY 2027/28. *36)'%78 &9(+)8 %'89%0*36)'%78 161 Table of Contents FY 2025/26 Adopted Budget 162 Table of Contents FUND PURPOSE BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance Beginning Ordinance 490 No. 4663, the city of will2024 asses percent Beginning in in FY FY 2025/26, 2025/26, in in accordance accordance with with voter voter approval approval and of Proposition in November anda 0.15 Ordinance No. 4633, the city will assess a 0.15 percent transaction privilege and use tax (the Park and Preserve Tax) for maintenance and improvement of city parks and for the maintenance and protection of the McDowell Sonoran Preserve, including police and fire security and protection. The Preserve Maintenance Fund represents the 18 percent of the Park and Preserve Tax collections after debt requirements are satisfied that is restricted for McDowell Sonoran Preserve maintenance and protection needs. Preserve Maintenance Fund Sources (% to Total) $4.4 Million Preserve Maintenance Fund Uses (% to Total) $3.1 Million Rounding differences may occur. 163 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance Summary Actual 20 23 /2 4 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Major Maintenance/Repair Reserve Fund Balance Total Beginning Fund Balance A do p t e d 20 24 /2 5 - Transfers In Preserve Maintenance - 18% Forecast 20 24 /2 5 - A do p t e d 20 25 /2 6 - - - - - 4,408,053 - - - 4,408,053 Total Sources - - - 4,408,053 E x p e n d i t u re s Preserve Planning and Administration Sonoran Desert - Natural Resource Projects Invasive Plant Management Wildland Fire Mitigation Habitat Protection - Monitoring Cultural History Protection Sonoran Desert Education Restoration of Degraded Lands Sonoran Desert - Periodic Projects - - - 1,741,621 400,000 350,000 350,000 100,000 80,000 75,000 50,000 - - - - 3,146,621 - - - 3,146,621 T o t a l U se s - - - 3,146,621 Sources Over/(Under) Uses - - - 1,261,432 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Major Maintenance/Repair Reserve Fund Balance Total Ending Fund Balance - - - 314,662 629,324 317,446 1,261,432 Subtotal Subtotal TOTAL OPERATING BUDGET The Preserve Maintenance Fund is established for the first time in FY 2025/26 to accommodate the voter-approved 0.15 percent Park and Preserve Tax. 164 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance Five-Year Financial A do p t e d 20 25 /2 6 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Major Maintenance/Repair Reserve Fund Balance Balance Total Beginning Fund Balance Transfers In Preserve Maintenance - 18% Forecast 20 26 /2 7 - 314,662 629,324 317,446 1,261,432 Forecast 20 27 /2 8 391,010 782,020 323,402 1,496,432 Forecast 20 28 /2 9 383,460 766,920 707,852 1,858,232 Forecast 20 29 /3 0 392,980 785,960 1,115,392 2,294,332 4,408,053 4,145,100 4,196,400 4,365,900 4,566,300 4,408,053 4,145,100 4,196,400 4,365,900 4 ,5 6 6 ,3 0 0 Total Sources 4,408,053 4,145,100 4,196,400 4,365,900 4,566,300 E x p e n d i t u re s Preserve Planning and Administration Sonoran Desert - Natural Resource Projects Invasive Plant Management Wildland Fire Mitigation Habitat Protection - Monitoring Cultural History Protection Sonoran Desert Education Restoration of Degraded Lands Sonoran Desert - Periodic Projects 1,741,621 400,000 350,000 350,000 100,000 80,000 75,000 50,000 - 1,826,500 563,800 358,900 358,900 150,000 82,000 170,000 50,000 350,000 1,928,000 575,000 367,800 376,700 153,000 84,100 300,000 50,000 - 1,958,000 586,500 376,900 386,100 156,100 86,200 330,000 50,000 - 2,033,200 598,300 342,300 395,800 159,200 88,300 338,300 50,000 - 3,146,621 3,910,100 3,834,600 3,929,800 4 ,0 0 5 ,4 0 0 3,146,621 3,910,100 3,834,600 3,929,800 4,005,400 T o t a l U se s 3,146,621 3,910,100 3,834,600 3,929,800 4,005,400 Sources Over/(Under) Uses 1,261,432 235,000 361,800 436,100 560,900 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Major Maintenance/Repair Reserve Fund Balance Balance T otal Ending Fund Balance 314,662 629,324 317,446 1,261,432 391,010 782,020 323,402 1,496,432 383,460 766,920 707,852 1,858,232 392,980 785,960 1,115,392 2,294,332 400,540 801,080 1,653,612 2,855,232 Subtotal Subtotal TOTAL OPERATING BUDGET 165 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance 73236%2()7)682%896%06)7396') 463.)'87 *=XS*= MRQMPPMSRW 7SRSVER(IWIVX2EXYVEP6IWSYVGI4VSNIGXWTVSZMHIWJYRHMRK JSVGSRXVEGXYEPWIVZMGIWXSWYTTSVXTVSNIGXWWYGLEWWXYHMIW ERHEREP]WMWSJJPSVEJEYREVMTEVMEREVIEWERHKISPSK]8LI *=EHSTXIHFYHKIXMWQMPPMSR -2:%7-:)40%281%2%+)1)28 *=XS*= MRQMPPMSRW -RZEWMZI4PERX1EREKIQIRXTVSZMHIWJYRHMRKJSV:   GSRXVEGXYEPWIVZMGIWXSGSRXVSPMRZEWMZITPERXKVS[XLERH  GSQQSHMXMIWWYGLEWTVIIQIVKIRXGLIQMGEPW8LI*= EHSTXIHFYHKIXMWQMPPMSR ;-0(0%2(*-6)1-8-+%8-32 *=XS*= MRQMPPMSRW ;MPHPERH*MVI1MXMKEXMSRTVSZMHIWJYRHMRKJSV:   GSRXVEGXYEPWIVZMGIWWYGLEWQIGLERMGEPXLMRRMRKSJ TPERXWERH GSQQSHMXMIWWYGLEWSTIVEXMRKWYTTPMIW 8LI*=EHSTXIHFYHKIXMWQMPPMSR *36)'%78 &9(+)8 %'89%0*36)'%78 167 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance ,%&-8%84638)'8-32132-836-2+ *=XS*= MRQMPPMSRW ,EFMXEX4VSXIGXMSR1SRMXSVMRKTVSZMHIWJYRHMRKJSV GSRXVEGXYEPWIVZMGIWXSIWXEFPMWLXLILEFMXEXTVSXIGXMSRERH QSRMXSVMRKGIRXIVXSMRGPYHIQETTMRKQSRMXSVMRKERH EWWIWWMRKXLITVSKVIWWSJXLI[MPHPERHJMVIQMXMKEXMSRERH VIWXSVEXMSRSJHIKVEHIHPERHWTVSNIGXW8LI*= EHSTXIHFYHKIXMWQMPPMSR '90896%0,-7836=4638)'8-32 *=XS*= MRQMPPMSRW Cultural History Protection provides funding for the preservation of prehistoric and historic areas within the Preserve, including associated artifacts and archeology. Funding supports contractual services to complete surveys of previously unsurveyed areas and to develop a discovery and monitoring plan. The FY 2025/26 adopted budget is $0.1 million. 73236%2()7)68)(9'%8-32 *=XS*= MRQMPPMSRW 7SRSVER(IWIVX)HYGEXMSRJYRHWTYFPMGEGGIWWJSVIHYGEXMSREP TYVTSWIWXSMRGPYHI: GSRXVEGXYEPWIVZMGIWJSVFYW XVERWTSVXEXMSRERHIHYGEXMSREPTVSKVEQI\TIRWIWJSV 7GSXXWHEPIWXYHIRXWVIWMHIRXWXSYVMWXWERHXLIKIRIVEPTYFPMG ERH GSQQSHMXMIWWYGLEWSJJMGIWYTTPMIW8LI*= EHSTXIHFYHKIXMWQMPPMSR *36)'%78 168 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance 6)7836%8-323*()+6%()(0%2(7 *=XS*= 6IWXSVEXMSRSJ(IKVEHIH0ERHWTVSZMHIWJYRHMRKJSV GSRXVEGXYEPWIVZMGIWXSGSQTPIXIPERHVIWXSVEXMSRTVSNIGXW8LI *=EHSTXIHFYHKIXMW 73236%2()7)684)6-3(-'463.)'87 *=XS*= MRQMPPMSRW 7SRSVER(IWIVX4IVMSHMG4VSNIGXWTVSZMHIWJYRHMRKJSV contractual services for periodic projects including trailhead and trail updates and modifications, such as shade, restroom upgrades, and trail assessments.8LIVIEVIRS I\TIRWIWFYHKIXIHJSV*= 46)7)6:)1%-28)2%2')*92()2(-2+&%0%2') 8LI4VIWIVZI1EMRXIRERGI*YRH)RHMRK&EPERGITVSXIGXWXLIJYRH WJMRERGMEPGSRHMXMSRERHTVSZMHIWJSVYRI\TIGXIH IGSRSQMGGLEPPIRKIW8LI*=IRHMRKFEPERGIMWapproximately QMPPMSR *36)'%78 &9(+)8 %'89%0*36)'%78 169 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Preserve Maintenance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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance FUND PURPOSE Beginning in FY 2025/26, in accordance with voter approval of Proposition 490 in November of 2024 and Ordinance No. 4633, the city will assess a 0.15 percent transaction privilege and use tax (the Park and Preserve Tax) for maintenance and improvement of city parks and for the maintenance and protection of the McDowell Sonoran Preserve, including police and fire security and protection. The Park Maintenance Fund represents the 14 percent of the Park and Preserve Tax collections after debt requirements are satisfied that is restricted for city parks and recreational facilities maintenance (excluding WestWorld). Park Maintenance Fund Sources (% to Total) $3.4 Million Park Maintenance Fund Uses (% to Total) $2.2 Million Rounding differences may occur. 171 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance Summary Actual 20 23 /2 4 Adopted 20 24 /2 5 Forecast 20 24 /2 5 Adopted 20 25 /2 6 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Park Maintenance Fund Balance Total Beginning Fund Balance - - - - Transfers In Park Maintenance - 14% - - - 3,428,485 - - - 3 , 4 28 , 4 85 Total Sources - - - 3 ,4 2 8 ,4 8 5 E x p e n d i t u re s Personnel Services Contractual Services Commodities Capital Outlays - - - 254,033 1,514,249 176,400 291,060 - - - 2 , 2 35 , 7 42 - - - 2,235,742 Total Uses - - - 2 , 2 35 , 7 42 Sources Over/(Under) Uses - - - 1 ,1 9 2 , 7 4 3 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Park Maintenance Fund Balance Total Ending Fund Balance - - - 223,574 447,148 522,021 1 ,1 9 2 ,7 4 3 Subtotal Subtotal TOTAL OPERATING BUDGET The Park Maintenance Fund is established for the first time in FY 2025/26 to accommodate the voter-approved 0.15 percent Park and Preserve Tax. 172 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance Five-Year Financial Forecast Adopted 20 25 /2 6 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Park Maintenance Fund Balance Total Beginning Fund Balance Forecast 20 26 /2 7 Forecast 20 27 /2 8 Forecast 20 28 /2 9 Forecast 20 29 /3 0 - 223,574 447,148 522,021 1 , 1 92 , 7 43 302,940 605,880 478,523 1,387,343 305,520 611,040 679,483 1,596,043 312,250 624,500 932,493 1,869,243 3,428,485 3,224,000 3,263,900 3,395,700 3,551,600 3 , 4 28 , 4 85 3,224,000 3,263,900 3,395,700 3 ,5 5 1 ,6 0 0 Total Sources 3 , 4 28 , 4 85 3,224,000 3,263,900 3,395,700 3,551,600 E x p e n d i t u re s Personnel Services Contractual Services Commodities Capital Outlays 254,033 1,514,249 176,400 291,060 1,168,400 1,135,500 54,200 671,300 1,526,500 1,435,300 43,400 50,000 1,559,500 1,469,600 43,400 50,000 1,653,800 1,485,400 43,400 50,000 2 , 2 35 , 7 42 3,029,400 3,055,200 3,122,500 3,232,600 2,235,742 3,029,400 3,055,200 3,122,500 3,232,600 Total Uses 2 ,2 3 5 , 7 4 2 3,029,400 3,055,200 3 ,1 2 2 ,5 0 0 3,232,600 Sources Over/(Under) Uses 1 , 1 92 , 7 43 194,600 208,700 2 73 , 2 00 3 1 9 ,0 0 0 223,574 447,148 522,021 1,192,743 302,940 605,880 478,523 1 , 3 87 , 3 43 305,520 611,040 679,483 1 , 5 96 , 0 43 312,250 624,500 932,493 1,869,243 323,260 646,520 1,218,463 2,188,243 Transfers In Park Maintenance - 14% Subtotal Subtotal TOTAL OPERATING BUDGET Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Park Maintenance Fund Balance 173 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance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he FY 2026/27 forecast includes additional FTE positions to achieve the staffing levels required for city parks and recreational facilities maintenance. *36)'%78 174 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Park Maintenance 4%6/1%-28)2%2')*92(&%0%2') *=XS*= MRQMPPMSRW 8LI4EVO1EMRXIRERGI*YRH&EPERGIEGGSYRXWJSVER]JYRHW VIQEMRMRKEJXIVXLIHIWMKREXMSRXSEPPSXLIVVIWIVZIWERHYWIW 8LI*=4EVO1EMRXIRERGI*YRH&EPERGIMW QMPPMSR *36)'%78 &9(+)8 %'89%0*36)'%78 177 Table of Contents FY 2025/26 Adopted Budget 178 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation FUND PURPOSE Beginning in FY 2025/26, in accordance with voter approval of Proposition 490 in November of 2024 and Ordinance No. 4633, the city will assess a 0.15 percent transaction privilege and use tax (the Park and Preserve Tax) for maintenance and improvement of city parks and for the maintenance and protection of the McDowell Sonoran Preserve, including police and fire security and protection. The Fire Mitigation Fund represents the 10 percent of the Park and Preserve Tax collections after debt requirements are satisfied that is restricted for Fire Department needs related to parks and the Preserve. These needs include, but are not limited to, technical rescue teams for the Preserve and city parks, and fire fuel mitigation around the Preserve and in and around the city for the protection and maintenance of the Preserve and city parks. Fire Mitigation Fund Sources (% to Total) $2.4 Million Fire Mitigation Fund Uses (% to Total) $1.8 Million Rounding differences may occur. 179 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation Summary Actual 20 23 /2 4 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Fire Mitigation Fund Balance Total Beginning Fund Balance Transfers In Fire Mitigation - 10% A do p t e d 20 24 /2 5 - Subtotal - Forecast 20 24 /2 5 - A do p t e d 20 25 /2 6 - 2,448,918 - - - 2,448,918 Total Sources - - - 2,448,918 Expenditures Personnel Services Contractual Services Commodities Capital Outlays - - - 1,225,140 398,150 99,860 30,884 - - - 1,754,034 - - - 1,754,034 Total Us e s - - - 1,754,034 Sources Over/(Under) Uses - - - 694,884 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Fire Mitigation Fund Balance Total Ending Fund Balance - - - 175,403 350,807 168,674 694,884 TOTAL OPERATING BUDGET Subtotal The Fire Mitigation Fund is established for the first time in FY 2025/26 to accommodate the voter-approved 0.15 percent Park and Preserve Tax. 180 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation Five-Year Financial Forecast A do p t e d 20 25 /2 6 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Fire Mitigation Fund Balance Total Beginning Fund Balance Transfers In Fire Mitigation - 10% Forecast 20 26 /2 7 - Subtotal 2,448,918 175,403 350,807 168,674 694,884 2,302,800 Forecast 20 27 /2 8 197,050 394,100 436,034 1,027,184 2,331,400 Forecast 20 28 /2 9 211,140 422,280 613,764 1,247,184 2,425,500 Forecast 20 29 /3 0 210,080 420,160 941,644 1,571,884 2,536,800 2,448,918 2,302,800 2,331,400 2,425,500 2,536,800 Total Sources 2,448,918 2,302,800 2,331,400 2,425,500 2,536,800 Expenditures Personnel Services Contractual Services Commodities Capital Outlays 1,225,140 398,150 99,860 30,884 1,612,500 305,700 52,300 - 1,752,100 305,800 53,500 - 1,740,100 306,100 54,600 - 1,788,800 306,200 55,900 - 1,754,034 1,970,500 2,111,400 2,100,800 2,150,900 1,754,034 1,970,500 2,111,400 2,100,800 2,150,900 1,754,034 1,970,500 2,111,400 2,100,800 2,150,900 Sources Over/(Under) Uses 694,884 332,300 220,000 324,700 385,900 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Fire Mitigation Fund Balance Total Ending Fund Balance 175,403 350,807 168,674 694,884 197,050 394,100 436,034 1,027,184 211,140 422,280 613,764 1,247,184 210,080 420,160 941,644 1,571,884 215,090 430,180 1,312,514 1,957,784 TOTAL OPERATING BUDGET Total Us e s Subtotal 181 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Fire Mitigation *-6)1-8-+%8-32*92(&%0%2') *=XS*= MRQMPPMSRW 8LI*MVI1MXMKEXMSR*YRH&EPERGIEGGSYRXWJSVER]JYRHW VIQEMRMRKEJXIVXLIHIWMKREXMSRXSEPPSXLIVYWIW GSRXMRKIRGMIWERHVIWIVZIW8LI*=*MVI1MXMKEXMSR *YRH&EPERGIMWQMPPMSR *36)'%78 &9(+)8 %'89%0*36)'%78 185 Table of Contents FY 2025/26 Adopted Budget 186 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger FUND PURPOSE Beginning in FY 2025/26, in accordance with voter approval of Proposition 490 in November of 2024 and Ordinance No. 4633, the city will assess a 0.15 percent transaction privilege and use tax (the Park and Preserve Tax) for maintenance and improvement of city parks and for the maintenance and protection of the McDowell Sonoran Preserve, including police and fire security and protection. The Police Ranger Fund represents the seven percent of the Park and Preserve Tax collections after debt requirements are satisfied that is restricted for police ranger operations. Police Ranger Fund Sources (% to Total) $1.7 Million Police Ranger Fund Uses (% to Total) $1.3 Million Rounding differences may occur. 187 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger Actual 20 23 /2 4 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Police Ranger Fund Balance Total Beginning Fund Balance Adopted 20 24 /2 5 - Transfers In Police Ranger - 7% Forecast 20 24 /2 5 - Adopted 20 25 /2 6 - - - - - 1,714,243 - - - 1,714,243 Total Sources - - - 1,714,243 Expenditures Personnel Services Contractual Services Commodities Capital Outlays - - - 819,113 25,405 62,894 347,600 - - - 1,255,012 - - - 1,255,012 Total Us e s - - - 1,255,012 Sources Over/(Under) Uses - - - 459,231 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Police Ranger Fund Balance Total Ending Fund Balance - - - 125,501 251,002 82,728 459,231 Subtotal Subtotal TOTAL OPERATING BUDGET The Police Ranger Fund is established for the first time in FY 2025/26 to accommodate the voter-approved 0.15 percent Park and Preserve Tax. 188 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger Adopted 20 25 /2 6 Beginning Fund Balance Operating Contingency Revenue Stabilization Reserve Police Ranger Fund Balance Total Beginning Fund Balance Forecast 20 26 /2 7 Forecast 20 27 /2 8 Forecast 20 28 /2 9 Forecast 20 29 /3 0 - 125,501 251,002 82,728 4 59 , 2 31 144,690 289,380 190,261 624,331 158,360 316,720 197,551 6 7 2 ,6 3 1 161,050 322,100 276,781 7 5 9 ,9 3 1 1,714,243 1,612,000 1,631,900 1,697,800 1,775,800 1,714,243 1,612,000 1,631,900 1,697,800 1,775,800 1,714,243 1,612,000 1,631,900 1,697,800 1,775,800 819,113 25,405 62,894 347,600 1,340,300 26,700 66,000 13,900 1,471,700 28,000 69,300 14,600 1,493,000 29,300 72,900 15,300 1,562,800 30,800 76,400 16,000 1,255,012 1,446,900 1,583,600 1,610,500 1,686,000 1,255,012 1,446,900 1,583,600 1,610,500 1,686,000 Total Us e s 1,255,012 1 ,4 4 6 ,9 0 0 1,583,600 1,610,500 1,686,000 Sources Over/(Under) Uses 459,231 165,100 48 , 3 00 87 , 3 00 89,800 Ending Fund Balance Operating Contingency Revenue Stabilization Reserve Police Ranger Fund Balance Total Ending Fund Balance 125,501 251,002 82,728 4 59 , 2 31 144,690 289,380 190,261 6 2 4 ,3 3 1 158,360 316,720 197,551 6 72 , 6 31 161,050 322,100 276,781 759,931 168,600 337,200 343,931 8 4 9 ,7 3 1 Transfers In Police Ranger - 7% Subtotal Total Sources Expenditures Personnel Services Contractual Services Commodities Capital Outlays Subtotal TOTAL OPERATING BUDGET 189 Table of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger 430-')6%2+)6*92(7396')7 4IVFMRERGMEPPSPMG]2SXLIERRYEP4EVOERH4VIWIVZI8E\VIZIRYIWEVIHITSWMXIHMRXLI4EVOERH4VIWIVZI8E\%PPSGEXMSR *YRHERHTIVGIRXSJXLIGSPPIGXMSRWEJXIVEPPHIFXVIUYMVIQIRXWEVIWEXMWJMIHEVIXVERWJIVVIHXSXLI4SPMGI6ERKIV*YRHThe FY 2025/26 budgeted revenue for the Police Ranger Fund is $1.7 million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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger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able of Contents BUDGET BY FUND | Park and Preserve Tax Fund - Police Ranger 430-')6%2+)6*92(&%0%2') *=XS*= MRQMPPMSRW 8LI4SPMGI6ERKIV*YRH&EPERGIEGGSYRXWJSVER]JYRHW VIQEMRMRKEJXIVXLIHIWMKREXMSRXSEPPSXLIVYWIW GSRXMRKIRGMIWERHVIWIVZIW8LI*=4SPMGI6ERKIV *YRH&EPERGIMWQMPPMSR *36)'%78 &9(+)8 %'89%0*36)'%78 193 Table of Contents FY 2025/26 Adopted Budget 194 Table of Contents BUDGET BY FUND | Special Programs Fund FUND PURPOSE In accordance with the Governmental Accounting Standards Board, the Special Programs Fund is used to account for dedicated funding sources and donations earmarked for specific purposes imposed by formal action of the City Council or restricted by an outside source. All revenue not expended in the current fiscal year are carried over to the next fiscal year to continue funding for the intended purpose. Special Programs Fund Sources (% to Total) $27.9 Million Special Programs Fund Uses (% to Total) $27.9 Million Rounding differences may occur. 195 Table of Contents BUDGET BY FUND | Special Programs Fund Summary Actual 20 23 /2 4 Adopted 20 24 /2 5 Forecast 20 24 /2 5 Adopted 20 25 /2 6 673,500 6,938,105 275 406 3,612,060 802,724 1,051,023 11,120 1,140,099 3,689,712 2,924,489 352,818 2 0 ,5 2 2 ,8 3 1 1,500,000 5,950,353 275 406 4,579,603 808,171 1,457,872 12,651 1,176,885 5,366,400 3,290,941 471,820 2 3 ,1 1 5 , 3 7 8 1,500,000 6,319,251 4,486 406 5,102,692 996,412 2,536,470 10,304 1,164,240 5,970,422 1,831,296 345,207 2 4 ,2 8 1 ,1 8 6 1,500,000 6,911,908 4,486 406 4,459,258 968,644 2,156,759 45,707 1,093,120 5,672,601 1,693,159 378,938 2 3 ,3 8 4 ,9 8 6 Subtotal 1,920,011 4,211 4,867,992 828,009 1,864,490 610,029 9,903,124 3,003,911 607,211 23,608,987 2,729,308 20,000 4,717,511 757,676 811,241 94,208 597,007 8,206,004 4,846,331 347,278 23,126,564 2,729,308 20,000 4,717,511 812,750 811,241 94,208 597,007 8,206,004 4,846,331 347,278 23,181,638 2,756,622 20,000 7,029,857 818,005 3,246,319 103,500 637,928 8,178,373 4,720,984 345,000 27,856,588 10,000 10,000 10,000 10,000 - Subtotal 1,010,544 271,919 1,282,463 - 2 4 ,8 9 1 ,4 5 0 2 3 ,1 3 6 ,5 6 4 2 3 ,1 9 1 , 6 3 8 2 7 , 8 5 6 ,5 8 8 B e g in n in g F un d B a l a nc e Appropriation Contingency (a) Reserve - City Court Reserve - City Manager's Office Reserve - Economic Development Reserve - Enterprise Operations Reserve - Fire Department Reserve - Library and Human Services Reserve - Mayor and City Council Reserve - Parks and Recreation and Preserve Reserve - Planning and Development Services Reserve - Police Department Reserve - Transportation and Infrastructure Total Beginning Fund Balance R e v e nu e s City Court City Manager's Office Economic Development Enterprise Operations Fire Department Library and Human Services Mayor and City Council Parks and Recreation and Preserve Planning and Development Services Police Department Transportation and Infrastructure Transfers In CIP (b) Operating(c) Total Sources (a) The Appropriation Contingency for the Special Programs Fund is an unfunded contingency that allows for the expenditure of unanticipated revenues from a dedicated funding source and is not included in the beginning or ending fund balances. (b) In FY 2023/24, the Council approved to return of the $1,000,000 monetary donation received from the Scottsdale Railroad and Mechanical Society to fund the purchase and installation of an indoor play structure inside the McCormick Stillman Railroad Park Roundhouse. (c) FY 2023/24 includes an accounting entry to ensure that the national opioid settlement distribution received from Maricopa County was recorded in an appropriate cost center. 196 Table of Contents BUDGET BY FUND | Special Programs Fund Summary Actual 20 23 /2 4 Adopted 20 24 /2 5 Forecast 20 24 /2 5 Adopted 20 25 /2 6 Subtotal 1,751,086 3,948,130 634,321 385,932 815 585,888 71,906 4,077,104 19,709 11,474,892 2,151,916 20,000 4,754,881 844,837 1,191,771 58,806 668,128 617,822 5,063,949 255,805 15,627,915 2,136,651 20,000 4,676,180 840,517 1,190,953 58,806 668,128 617,822 4,964,467 255,817 15,429,341 2,141,824 20,000 4,329,238 919,006 998,225 68,806 990,287 715,493 4,359,034 255,817 14,797,730 Subtotal 136,104 136,104 57,729 57,729 57,729 57,729 48,892 48,892 11,610,997 15,685,644 15,487,070 14,846,622 2,036,890 6,004,742 766,429 714,038 9,522,099 620,000 7,227,254 753,515 8,600,769 620,000 7,227,254 753,515 8,600,769 5,137,819 7,203,623 759,066 13,100,508 Total Uses 2 1 ,1 3 3 ,0 9 6 2 4 ,2 8 6 , 4 1 3 2 4 ,0 8 7 ,8 3 9 2 7 ,9 4 7 ,1 3 0 Sources Over/(Under) Uses 3 ,7 5 8 ,3 5 5 (1 , 1 4 9 , 8 4 9 ) (8 9 6 , 2 0 1 ) (9 0 , 5 4 2 ) 700,000 6,319,251 4,486 406 5,102,692 996,412 2,536,470 10,304 1,164,240 5,970,422 1,831,296 345,207 2 4 ,2 8 1 ,1 8 6 1,320,809 6,527,745 275 406 3,857,468 721,009 1,077,342 48,054 1,105,764 5,068,578 3,053,325 505,564 2 1 ,9 6 5 ,5 3 0 1,320,809 6,911,908 4,486 406 4,459,258 968,644 2,156,759 45,707 1,093,120 5,672,601 1,693,159 378,938 2 3 ,3 8 4 ,9 8 6 1,500,000 7,526,706 4,486 406 2,452,146 867,643 4,404,853 80,401 494,317 5,267,108 1,777,149 419,229 2 3 ,2 9 4 ,4 4 4 Expenditures City Court Economic Development Enterprise Operations Fire Department Library and Human Services Mayor and City Council Parks and Recreation and Preserve Planning and Development Services Police Department Transportation and Infrastructure Debt Service Contracts Payable TOTAL OPERATING BUDGET Transfers Out CIP CIP Stormwater Debt Svc MPC Bonds Operating(a) Subtotal Ending Fund Balance Appropriation Contingency (b) Reserve - City Court Reserve - City Manager's Office Reserve - Economic Development Reserve - Enterprise Operations Reserve - Fire Department Reserve - Library and Human Services Reserve - Mayor and City Council Reserve - Parks and Recreation and Preserve Reserve - Planning and Development Services Reserve - Police Department Reserve - Transportation and Infrastructure Total Ending Fund Balance (a) FY 2023/24 includes an accounting entry to ensure that the national opioid settlement distribution received from Maricopa County was recorded in an appropriate cost center. Additionally, it includes a transfer out to the Planning and Development Services Department to cover the cost of permits pulled by Southwest Gas with funds received from franchise fees. (b) The Appropriation Contingency for the Special Programs Fund is an unfunded contingency that allows for the expenditure of unanticipated revenues from a dedicated funding source and is not included in the beginning or ending fund balances. 197 Table of Contents BUDGET BY FUND | Special Programs Fund Five-Year Financial Forecast Adopted 20 25 /2 6 Forecast 20 26 /2 7 Forecast 20 27 /2 8 Forecast 20 28 /2 9 Forecast 20 29 /3 0 1,500,000 6,911,908 4,486 406 4,459,258 968,644 2,156,759 45,707 1,093,120 5,672,601 1,693,159 378,938 2 3 ,3 8 4 ,9 8 6 1,500,000 7,526,706 4,486 406 2,452,146 867,643 4,404,853 80,401 494,317 5,267,108 1,777,149 419,229 2 3 ,2 9 4 ,4 4 4 1,500,000 8,094,406 4,486 406 3,400,796 726,943 4,486,053 114,801 419,417 5,146,608 2,102,249 461,729 2 4 ,9 5 7 ,8 9 4 1,500,000 8,525,006 4,486 406 4,193,196 530,043 4,569,053 148,901 488,817 5,076,008 2,391,749 506,429 2 6 ,4 3 4 ,0 9 4 1,500,000 8,922,906 4,486 406 5,732,496 334,343 4,652,953 182,501 558,717 3,370,408 2,636,849 553,329 2 6 ,9 4 9 ,3 9 4 2,756,622 20,000 7,029,857 818,005 3,246,319 103,500 637,928 8,178,373 4,720,984 345,000 27,856,588 2,752,500 20,000 7,169,700 826,400 545,300 103,900 650,700 7,947,100 4,943,900 345,000 25,304,500 2,745,500 20,000 7,297,900 834,700 561,400 104,500 663,900 7,975,900 5,172,200 345,000 25,721,000 2,740,900 20,000 7,437,800 843,200 578,000 105,100 677,000 8,004,600 5,308,400 345,000 26,060,000 2,743,600 20,000 7,581,800 851,800 595,300 44,800 689,900 8,033,400 5,430,400 345,000 26,336,000 - - - 2 6 ,3 3 6 ,0 0 0 B e g in n in g F un d B a l a nc e Appropriation Contingency (a) Reserve - City Court Reserve - City Manager's Office Reserve - Economic Development Reserve - Enterprise Operations Reserve - Fire Department Reserve - Library and Human Services Reserve - Mayor and City Council Reserve - Parks and Recreation and Preserve Reserve - Planning and Development Services Reserve - Police Department Reserve - Transportation and Infrastructure Total Beginning Fund Balance R e v e nu e s City Court City Manager's Office Economic Development Enterprise Operations Fire Department Library and Human Services Mayor and City Council Parks and Recreation and Preserve Planning and Development Services Police Department Transportation and Infrastructure Subtotal Transfers In CIP Operating Subtotal Total Sources - - - - 2 7 , 8 5 6 ,5 8 8 2 5 ,3 0 4 , 5 0 0 2 5 ,7 2 1 ,0 0 0 2 6 , 0 6 0 ,0 0 0 (a) The Appropriation Contingency for the Special Programs Fund is an unfunded contingency that allows for the expenditure of unanticipated revenues from a dedicated funding source and is not included in the beginning or ending fund balances. 198 Table of Contents BUDGET BY FUND | Special Programs Fund Five-Year Financial Forecast Adopted 20 25 /2 6 Forecast 20 26 /2 7 Forecast 20 27 /2 8 Forecast 20 28 /2 9 Forecast 20 29 /3 0 Subtotal 2,141,824 20,000 4,329,238 919,006 998,225 68,806 990,287 715,493 4,359,034 255,817 14,797,730 2,184,800 20,000 5,162,900 967,100 464,100 69,500 725,600 170,500 4,618,800 255,800 14,639,100 2,314,900 20,000 5,425,200 1,031,600 478,400 70,400 594,500 120,600 4,882,700 255,800 15,194,100 2,343,000 20,000 5,498,800 1,038,900 494,100 71,500 607,100 155,600 5,063,300 255,800 15,548,100 2,436,400 20,000 5,683,300 1,087,200 509,600 72,600 619,800 100,600 5,304,400 255,800 16,089,700 Subtotal 48,892 48,892 46,700 46,700 44,500 44,500 42,300 42,300 40,200 40,200 14,846,622 14,685,800 15,238,600 15,590,400 16,129,900 5,137,819 7,203,623 759,066 13,100,508 961,500 7,232,100 763,600 8,957,200 994,600 7,261,600 752,000 9,008,200 1,900,000 7,287,100 769,200 9,956,300 7,318,900 759,800 8,078,700 2 7 ,9 4 7 ,1 3 0 2 3 ,6 4 3 ,0 0 0 2 4 ,2 4 6 ,8 0 0 2 5 ,5 4 6 ,7 0 0 2 4 ,2 0 8 ,6 0 0 (9 0 , 5 4 2 ) 1 ,6 6 1 ,5 0 0 1 , 4 7 4 ,2 0 0 5 1 3 ,3 0 0 2 , 1 2 7 ,4 0 0 1,500,000 7,526,706 4,486 406 2,452,146 867,643 4,404,853 80,401 494,317 5,267,108 1,777,149 419,229 2 3 , 2 9 4 ,4 4 4 1,500,000 8,094,406 4,486 406 3,400,796 726,943 4,486,053 114,801 419,417 5,146,608 2,102,249 461,729 2 4 ,9 5 7 ,8 9 4 1,500,000 8,525,006 4,486 406 4,193,196 530,043 4,569,053 148,901 488,817 5,076,008 2,391,749 506,429 2 6 ,4 3 4 ,0 9 4 1,500,000 8,922,906 4,486 406 5,732,496 334,343 4,652,953 182,501 558,717 3,370,408 2,636,849 553,329 2 6 ,9 4 9 ,3 9 4 1,500,000 9,230,106 4,486 406 7,537,696 98,943 4,738,653 154,701 628,817 3,319,808 2,762,849 602,329 2 9 ,0 7 8 ,7 9 4 Expenditures City Court Economic Development Enterprise Operations Fire Department Library and Human Services Mayor and City Council Parks and Recreation and Preserve Planning and Development Services Police Department Transportation and Infrastructure Debt Service Contracts Payable TOTAL OPERATING BUDGET Transfers Out CIP CIP Stormwater Debt Svc MPC Bonds Operating Subtotal Total Uses Sources Over/(Under) Uses Ending Fund Balance Appropriation Contingency (a) Reserve - City Court Reserve - City Manager's Office Reserve - Economic Development Reserve - Enterprise Operations Reserve - Fire Department Reserve - Library and Human Services Reserve - Mayor and City Council Reserve - Parks and Recreation and Preserve Reserve - Planning and Development Services Reserve - Police Department Reserve - Transportation and Infrastructure Total Ending Fund Balance (a) The Appropriation Contingency for the Special Programs Fund is an unfunded contingency that allows for the expenditure of unanticipated revenues from a dedicated funding source and is not included in the beginning or ending fund balances. 199 Table of Contents BUDGET BY FUND | Special Programs Fund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’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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund 4%6/7%2(6)'6)%8-32%2(46)7)6:) *=XS*= MRQMPPMSRW 4EVOWERH6IGVIEXMSRERH4VIWIVZIWTIGMEPTVSKVEQWVIZIRYI MRGPYHIWJIIWJVSQVIWIVZEXMSRWERHVIRXEPWHSREXMSRW GSRXVMFYXMSRWERHWTSRWSVWLMTEKVIIQIRXWVIWXVMGXIHXS WTIGMJMGYWIWTIVXLIVIZIRYIWSYVGI8LI*= FYHKIXIHWTIGMEPTVSKVEQWVIZIRYIJSV4EVOWERH6IGVIEXMSR ERH4VIWIVZIMWQMPPMSR[LMGLMWVIPEXMZIP]JPEX[LIR GSQTEVIHXSXLI*=EHSTXIHFYHKIX 430-')()4%681)28 *=XS*= MRQMPPMSRW 4YFPMG7EJIX]4SPMGIVIZIRYIMWKIRIVEXIHJVSQXLIJSPPS[MRK IMKLXWSYVGIW 6EGOIXIIVMRK-RJPYIRGIH'SVVYTX3VKERM^EXMSR 6-'3 JYRHWXSIRLERGITSPMGISTIVEXMSRW *SVIRWMG 7IVZMGIW-RXIVKSZIVRQIRXEP%KVIIQIRX -+% [MXL GSQQYRMXMIWRIMKLFSVMRK7GSXXWHEPIJSVJYPPGSWXVIGSZIV]SJ WIVZMGIWTVSZMHIHEXXLIGVMQIPEFSVEXSV] HVYKGSRZMGXMSR EWWIWWQIRXWJSVXLITYVTSWISJGVMQIPEFSVEXSV]EREP]WMW  HSREXMSRWQEHIWTIGMJMGEPP]JSVXLI1SYRXIH9RMX*EQMP] %HZSGEG]'ERMRI9RMXERH'EHIX4VSKVEQ 4SPMGI(E] Tow Program that enforces State Statute (A.R.S. § 28-872) for HVMZMRKYRHIVXLIMRJPYIRGIERHHVMZMRK[MXLSYXMRWYVERGI offences; 6) Officer Safety Equipment established by A.R.S. § XLEXMQTSWIWEEWWIWWQIRX XSXLI MRZIWXMKEXMRKEVVIWXMRKEKIRG] SREPPGVMQMREPGLEVKIWGMZMP XVEJJMGERHTEVOMRKGLEVKIWXSTYVGLEWIWEJIX]IUYMTQIRXJSV SJJMGIVW 7IGSRH,ERHERH4E[R8VERWEGXMSR*II IWXEFPMWLIHF]3VHMRERGI2SMR1E]XLEXVIUYMVIW IPIGXVSRMGEPP]TVSGIWWIHTE[RXMGOIXWERHVIPEXIHJIIWFIYWIH XSVIGSZIVGSWXWVIPEXIHXSXLIEHQMRMWXVEXMSRSJXLITVSKVEQ ERH 6IZIRYIKIRIVEXIHJVSQXLI7QEVXERH7EJI%VM^SRE %GXSV4VSTSWMXMSR4VSTSWMXMSREPPS[IHXLI PIKEPM^EXMSRXE\EXMSRERHVIGVIEXMSREPYWISJGERREFMWJSV EHYPXWERHSZIVERH[EWETTVSZIHF]ZSXIVWMRXLI KIRIVEPIPIGXMSR1SRMIWVIGIMZIHF]PSGEPPE[IRJSVGIQIRX EKIRGMIWEVII\TIGXIHXSGSZIVTIEGISJJMGIVXVEMRMRK EGEHIQMIWERHW[SVRTIVWSRRIPGSWXW6IZIRYIIWXMQEXIH XLVSYKLVIWXVMGXIHVIZIRYIWSYVGIWJSV*=MW QMPPMSR[LMGLMWEHIGVIEWISJQMPPMSRJVSQXLI*= EHSTXIHFYHKIX *36)'%78 &9(+)8 %'89%0*36)'%78 203 Table of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund '-8='3968 *=XS*= MRQMPPMSRW 'MX]'SYVXEHSTXIHFYHKIXJSV*=MWQMPPMSRERH MRGPYHIWXLIJSPPS[MRKWTIGMJMGYWIW IRLERGIQIRXWXSXLI 'SYVX’WXIGLRSPSKMGEPSTIVEXMSREPERHWIGYVMX]JEGMPMXMIWEW EPPS[IHYRHIVXLI'SYVX)RLERGIQIRX*YRH ')* IWXEFPMWLIH F]7GSXXWHEPI'MX]3VHMRERGI2SWIGXMSR  EHHMXMSREPI\TIRHMXYVIWEWEPPS[IHF].YHMGMEP'SPPIGXMSRW )RLERGIQIRX*YRH .')* ERH*MPPXLI+ET *8+ IWXEFPMWLIH F]%VM^SRE6IZMWIH7XEXYXIW %67  %  & ERH0E[W 'LETXIVJSVXLIQEMRXIRERGIERHIRLERGIQIRXSJ XLI'SYVX’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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund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ow Program that enforces ARS § 28-3511; 7) equipment that IRLERGIWSJJMGIV’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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Special Programs Fund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able of Contents BUDGET BY FUND | Stadium Facility Fund FUND PURPOSE The Stadium Facility Fund is a special revenue fund created to account for activities at Scottsdale Stadium. In June 2019, the city entered into a 25-year baseball facilities agreement with the Scottsdale Charros and the San Francisco Giants Baseball Club for the use and maintenance of the Scottsdale Stadium. This fund accounts for the contributions and uses as per the agreement. Stadium Facility Fund Sources (% to Total) $2.2 Million Stadium Facility Fund Uses (% to Total) $4.3 Million Rounding differences may occur. 211 Table of Contents BUDGET BY FUND | Stadium Facility Fund Summary Beginning Fund Balance Stadium Lifecycle Stadium Facility Fund Balance Total Beginning Fund Balance Revenues Charros Capital Contribution (a) Giants Capital Contribution Giants Stadium Lifecycle Giants Stadium Maintenance Giants Stadium Operations Stadium Events Subtotal Total Sources Expenditures Personnel Services Contractual Services Commodities Capital Outlays (b) Subtotal TOTAL OPERATING BUDGET Actual 2023/24 Adopted 2024/25 Forecast 2024/25 Adopted 2025/26 3,094,822 2,012,457 5,107,279 3,104,069 2,641,458 5,745,527 3,113,493 2,004,582 5,118,075 3,171,456 2,805,765 5,977,221 135,000 - 135,000 525,000 135,000 525,000 135,000 525,000 144,844 173,765 485,852 737,560 187,963 176,399 531,790 697,000 187,963 176,399 531,790 697,000 180,265 172,500 531,710 660,598 1,677,021 2,253,152 2,253,152 2,205,073 1,677,021 2,253,152 2,253,152 2,205,073 295,381 484,019 99,110 127,715 280,089 253,238 70,679 1,050,000 280,089 253,238 70,679 130,000 947,340 434,289 129,141 1,150,000 1,006,225 1,654,006 734,006 2,660,770 1,006,225 1,654,006 734,006 2,660,770 - - - 1,000,000 Transfers Out (c) CIP Debt Service MPC Bonds T o t a l U s es S o u r c e s Ov e r / ( U n d e r ) U s e s Subtotal 660,000 660,000 660,000 660,000 660,000 660,000 660,000 1,660,000 1,666,225 2,314,006 1,394,006 4,320,770 10,796 (60,854) 859,146 (2,115,697) 2,242,032 3,442,641 5,684,673 3,171,456 2,805,765 5,977,221 2,201,721 1,659,803 3,861,524 Ending Fund Balance Stadium Lifecycle 3,113,493 Stadium Facility Fund Balance 2,004,582 Total Ending Fund Balance 5,118,075 (a) FY 2023/24 Giants Capital Contribution was received in FY 2024/25. (b) FY 2025/26 Capital Outlays for Stadium Sound Replacement and Upgrade. (c) Transfer to CIP for Stadium Center Field and Gate A Improvements capital project. 212 Table of Contents BUDGET BY FUND | Stadium Facility Fund Five-Year Financial Forecast Beginning Fund Balance Stadium Lifecycle Stadium Facility Fund Balance Total Beginning Fund Balance Revenues Charros Capital Contribution (a) Giants Capital Contribution Giants Stadium Lifecycle Giants Stadium Maintenance Giants Stadium Operations Stadium Events Subtotal Total Sources Expenditures Personnel Services Contractual Services Commodities Capital Outlays (b) Subtotal TOTAL OPERATING BUDGET Adopted 2025/26 Forecast 2026/27 Forecast 2027/28 Forecast 2028/29 Forecast 2029/30 3,171,456 2,805,765 5,977,221 2,201,721 1,659,803 3,861,524 1,631,221 1,509,903 3,141,124 1,717,121 1,287,903 3,005,024 1,543,221 1,142,103 2,685,324 135,000 525,000 135,000 525,000 135,000 525,000 135,000 600,000 135,000 600,000 180,265 172,500 531,710 660,598 179,500 175,900 542,200 672,800 175,900 179,400 553,000 685,200 176,100 183,000 564,100 697,900 182,800 186,700 575,500 710,900 2,205,073 2,230,400 2,253,500 2,356,100 2,390,900 2,205,073 2,230,400 2,253,500 2,356,100 2,390,900 947,340 434,289 129,141 1,150,000 995,600 444,100 101,100 750,000 1,081,900 454,500 103,200 90,000 1,095,300 464,900 105,600 350,000 1,148,700 475,700 108,000 350,000 2,660,770 2,290,800 1,729,600 2,015,800 2,082,400 2,660,770 2,290,800 1,729,600 2,015,800 2,082,400 1,000,000 - - - - Transfers Out (c) CIP Debt Service MPC Bonds Subtotal 660,000 660,000 660,000 660,000 660,000 1,660,000 660,000 660,000 660,000 660,000 T o t a l U s es 4,320,770 2,950,800 2,389,600 2,675,800 2,742,400 S o u r c e s Ov e r / ( U n d e r ) U s e s (2,115,697) (720,400) (136,100) (319,700) (351,500) 1,717,121 1,287,903 3,005,024 1,543,221 1,142,103 2,685,324 1,376,021 957,803 2,333,824 Ending Fund Balance Stadium Lifecycle 2,201,721 1,631,221 Stadium Facility Fund Balance 1,659,803 1,509,903 Total Ending Fund Balance 3,861,524 3,141,124 (a) FY 2023/24 Giants Capital Contribution was received in FY 2024/25. (b) FY 2025/26 Capital Outlays for Stadium Sound Replacement and Upgrade. (c) Transfer to CIP for Stadium Center Field and Gate A Improvements capital project. 213 Table of Contents BUDGET BY FUND | Stadium Facility Fund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ctual revenue for*=24/25 is higher than budgeted revenue due to the FY 2023/24receiptbeingVIGSVHIHMR*=. *36)'%78 214 &9(+)8 %'89%0*36)'%78 Table of Contents +-%28778%(-910-*)'='0) BUDGET BY FUND | Stadium Facility Fund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able of Contents 78%(-91):)287 BUDGET BY FUND | Stadium Facility Fund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and a $1.0 million transfer out to the CIP for capital improvements. 4)67322)07)6:-')7 *=XS*= MRQMPPMSRW 4IVWSRRIP7IVZMGIWMRGPYHIWXLIGSQTIRWEXMSRTEMHXS IQTPS]IIWSJXLI'MX]SJ7GSXXWHEPIERHIQTPS]IIJVMRKI FIRIJMXGSWXWWYGLEWXLIGMX] WGSRXVMFYXMSRWXSVIXMVIQIRX WSGMEPWIGYVMX]LIEPXLERH[SVOQIR WGSQTIRWEXMSR MRWYVERGI8LI*=EHSTXIHFYHKIXEQSYRXMW QMPPMSR[LMGLMWLMKLIVXLERTVMSV]IEVWHYIXSQSZMRKFYHKIX JVSQXLI+IRIVEP*YRHXSXLI7XEHMYQ*EGMPMX]*YRH8LI 7XEHMYQ*EGMPMX]*YRHWYTTSVXWJYPPXMQIIUYMZEPIRX *8) TSWMXMSRW *36)'%78 216 &9(+)8 %'89%0*36)'%78 Table of Contents '3286%'89%07)6:-')7 BUDGET BY FUND | Stadium Facility Fund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onetimeJYRHMRKJSVWXEHMYQWSYRHVITPEGIQIRXERHYTKVEHI [LMGLMWERMRGVIEWISJQMPPMSR[LIRGSQTEVIHXSXLI*= FYHKIX8LITVSNIGXXSVIWIEPXLI'LEVVS0SHKI[EW GSQTPIXIHMR*=ERHXLIVIQEMRMRKYRYWIHFYHKIX [EWGEVVMIHJSV[EVHXS*= *36)'%78 &9(+)8 %'89%0*36)'%78 217 Table of Contents BUDGET BY FUND | Stadium Facility Fund 86%27*)67398 8VERWJIVW3YXEVIXLIEYXLSVM^IHQSZIQIRXSJGEWLXSSXLIVJYRHWSVXLI'ETMXEP-QTVSZIQIRX4PER '-4  '-4 *=XS*= MRQMPPMSRW 8LI*=FYHKIXXVERWJIVWQMPPMSRXSXLI'-4 JSVXLI7XEHMYQ'IRXIV*MIPHERH+EXI%IQTVSZIQIRX capitalTVSNIGX ()&87)6:-')14'&32(7 *=XS*= MRQMPPMSRW Debt Service MPC Bonds accounts for annual contributions from the Giants and Charros to the Debt Service Fund to help support the stadium renovation projects. The annual contribution from the Giants increased in FY 2023/24. The FY 2025/26 adopted budget is $0.7 million. *36)'%78 218 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Tourism Development Fund FUND PURPOSE The Tourism Development Fund is a special revenue fund created to account for Transient Occupancy Tax revenues, Property Rental from Fairmont Scottsdale Princess Hotel lease payments, and other related miscellaneous revenues. All Tourism Development Fund revenues must be used for tourism related activities. Ordinance No. 4330, approved by Scottsdale City Council in March 2018, identifies the authorized expenditures to be made from this fund. Tourism Development Fund Sources (% to Total) $37.3 Million Tourism Development Fund Uses (% to Total) $36.4 Million Rounding differences may occur. 219 Table of Contents BUDGET BY FUND | Tourism Development Fund Summary Actual 2 0 2 3 /2 4 Beginning Fund Balance Destination Marketing Fund Balance Adopted 2 0 2 4 /2 5 Forecast 2 0 2 4 /2 5 Adopted 2 0 2 5 /2 6 7,276,338 2,500,000 6,026,858 1,500,000 2,500,000 5,713,284 1,500,000 2,500,000 6,221,667 1,500,000 2,500,000 11,538,505 2 1 , 31 4 , 8 43 5,819,310 1 5 , 84 6 , 1 68 7,927,637 1 7 , 64 0 , 9 21 4,491,716 1 4 , 71 3 , 3 83 S u b to t a l 34,597,315 3,932,551 497,635 14,373 39 , 0 41 , 8 74 31,561,346 3,245,605 687,414 25,000 3 5 ,5 1 9 , 3 6 5 33,805,485 3,245,605 687,414 25,000 37 , 7 63 , 50 4 33,000,000 3,657,800 592,737 15,000 3 7, 2 6 5, 5 37 S u b to t a l 1,703,401 1 , 7 03 , 4 01 - 1,000,000 1 , 0 00 , 0 00 - 4 0 ,7 4 5 , 2 7 5 35 , 5 1 9, 3 6 5 3 8 , 7 6 3 ,5 0 4 3 7 , 2 65 , 5 3 7 15,576,628 1,944,994 903,082 3,059,656 1,235,017 22 , 7 19 , 3 77 14,202,606 1,372,424 1,260,657 3,590,521 1,439,000 2 1 ,8 6 5 , 2 0 8 15,212,468 1,372,424 1,263,284 3,390,521 1,639,000 22 , 8 77 , 69 7 14,850,000 2,343,722 1,318,641 2,970,004 2,789,041 2 4, 2 7 1, 4 08 22,719,377 21,865,208 22,877,697 24,271,408 8,876,199 4,982,379 3,689,565 4,151,678 21 , 6 99 , 8 20 6,450,000 4,974,787 2,031,900 3,787,362 1 7 ,2 4 4 , 0 4 9 7,750,000 4,974,787 2,031,900 4,056,658 18 , 8 13 , 34 5 1,676,263 4,985,387 1,533,800 3,960,000 1 2, 1 5 5, 4 50 Total Uses 4 4 , 4 1 9 ,1 9 8 3 9 , 10 9 , 2 57 4 1 , 69 1 , 04 2 3 6 ,4 26 , 8 5 8 Sources Over/(Under) Uses ( 3 , 6 73 , 9 2 3) ( 3 , 5 89 , 8 9 2) ( 2 , 9 27 , 5 3 8) 8 3 8 ,6 7 9 7,213,284 2,500,000 7,927,637 1 7 ,6 40 , 9 2 1 6,423,034 1,500,000 2,500,000 1,833,242 1 2 , 2 5 6 ,2 7 6 6,221,667 1,500,000 2,500,000 4,491,716 1 4 , 7 13 , 3 8 3 5,732,653 1,500,000 2,500,000 5,819,409 1 5 , 5 5 2 ,0 6 2 (a) Operating Contingency - Destination Marketing Operating Contingency - Non- Destination Marketing Non Destination Marketing Fund Balance Total Beginning Fund Balance Revenues Transient Occupancy Tax Property Rental Interest Earnings Miscellaneous Transfers In (b) CIP (c) Operating Total Sources Expenditures Destination Marketing Contract - 45% (d) Destination Marketing - 5% Administration and Research - 4% Event Retention and Development - 9% Other Commitments - 25% (e) S u b to t a l TOTAL OPERATING BUDGET Transfers Out (f) CIP Debt Svc MPC Bonds Operating GF Transfer - 12% S u b to t a l Ending Fund Balance Destination Marketing Fund Balance (a) Operating Contingency - Destination Marketing Operating Contingency - Non- Destination Marketing Non-Destination Marketing Fund Balance Total Ending Fund Balance (a) A $1.5 million Operating Contingency was established in FY 2024/25 to provide budget authorization in the event of unforeseen expenses occurring during the year. (b) In FY 2023/24, savings from the WestWorld Tent Refurbishment capital project were transferred back to the original funding source. (c) FY 2024/25 includes the return of a prior transfer out to Facilities for the Arizona State Route 101 Traffic Interchange project which was transferred out to the CIP instead. (d) Spending in excess of the five percent calculated amount is intended to utilize existing fund balance for one-time items. (e) Per Financial Policy 10.02, the 25 percent for Other Commitments can be utilized for Operating, Capital, and Transfer Out uses. Please note that portions of the Transfers Out category compose the other areas of the 25 percent allocation. (f) Per Financial Policy 10.02, the 25 percent for Other Commitments cannot have a single commitment exceed $600,000, unless approved by council. The CIP Transfers Out contains a project that exceeds $600,000. Adoption of the budget would serve as approval by council in compliance with Policy 10.02. 220 Table of Contents BUDGET BY FUND | Tourism Development Fund Five-Year Financial Forecast Adopted 2 0 2 5 /2 6 Beginning Fund Balance Destination Marketing Fund Balance Forecast 2 0 2 7 /2 8 Forecast 2 0 2 8 /2 9 Forecast 2 0 2 9 /3 0 6,221,667 1,500,000 2,500,000 5,732,653 1,500,000 2,500,000 5,562,053 1,500,000 2,500,000 5,426,553 1,500,000 2,500,000 5,353,353 1,500,000 2,500,000 4,491,716 1 4, 7 1 3 ,3 8 3 5,819,409 1 5 , 55 2 , 0 62 7,391,409 1 6 , 95 3 , 4 62 9,513,309 1 8 , 93 9 , 8 62 14,345,509 2 3 ,6 98 , 8 6 2 S u b to t a l 33,000,000 3,657,800 592,737 15,000 3 7 ,2 6 5 , 5 3 7 33,726,000 3,749,200 581,200 15,000 38 , 07 1 , 40 0 34,737,800 3,843,000 552,000 15,000 3 9, 1 47 , 8 00 35,953,600 3,958,300 534,600 15,000 4 0 , 4 6 1 ,5 0 0 37,391,800 4,077,000 535,500 15,000 4 2, 0 19 , 3 00 S u b to t a l - - - - - 3 7 , 2 6 5 ,5 3 7 3 8 , 07 1 , 4 00 3 9 , 14 7 , 8 00 4 0 , 46 1 , 5 00 4 2 ,0 19 , 3 0 0 14,850,000 2,343,722 1,318,641 2,970,004 2,789,041 2 4 ,2 7 1 , 4 0 8 15,176,700 2,060,800 1,346,200 3,035,400 2,725,800 24 , 34 4 , 90 0 15,632,000 2,072,600 1,384,800 3,126,400 2,125,800 2 4, 3 41 , 6 00 16,179,100 2,071,800 1,432,700 3,235,800 1,925,800 2 4 , 8 4 5 ,2 0 0 16,826,300 2,078,800 1,488,700 3,365,300 1,925,900 2 5, 6 85 , 0 00 24,271,408 24,344,900 24,341,600 24,845,200 25,685,000 1,676,263 4,985,387 1,533,800 3,960,000 1 2 ,1 5 5 , 4 5 0 1,771,500 4,972,200 1,534,280 4,047,120 12 , 32 5 , 10 0 2,125,800 4,990,800 1,534,664 4,168,536 1 2, 8 19 , 8 00 5,008,200 1,534,668 4,314,432 1 0 , 8 5 7 ,3 0 0 4,127,200 534,684 4,487,016 9 , 1 4 8 ,9 0 0 3 6 ,4 2 6 , 8 5 8 3 6, 6 7 0 ,0 0 0 3 7 , 16 1 , 4 00 3 5 , 70 2 , 5 00 3 4 ,8 33 , 9 0 0 8 3 8 ,6 7 9 1 , 4 01 , 4 0 0 1 , 9 8 6 ,4 0 0 4 , 7 59 , 0 0 0 7 , 18 5 , 4 00 5,732,653 1,500,000 2,500,000 5,819,409 15 , 5 5 2, 0 6 2 5,562,053 1,500,000 2,500,000 7,391,409 16 , 9 5 3, 4 6 2 5,426,553 1,500,000 2,500,000 9,513,309 18 , 9 3 9, 8 6 2 5,353,353 1,500,000 2,500,000 14,345,509 23 , 6 9 8, 8 6 2 5,352,553 1,500,000 2,500,000 21,531,709 3 0 ,8 84 , 2 6 2 (a) Operating Contingency - Destination Marketing Operating Contingency - Non- Destination Marketing Non Destination Marketing Fund Balance Total Beginning Fund Balance Revenues Transient Occupancy Tax Property Rental Interest Earnings Miscellaneous Transfers In CIP Operating Total Sources Expenditures Destination Marketing Contract - 45% (b) Destination Marketing - 5% Administration and Research - 4% Event Retention and Development - 9% Other Commitments - 25% Forecast 2 0 2 6 /2 7 (c) S u b to t a l TOTAL OPERATING BUDGET Transfers Out (d) CIP Debt Svc MPC Bonds Operating GF Transfer - 12% S u b to t a l Total Uses Sources Over/(Under) Uses Ending Fund Balance Destination Marketing Fund Balance Operating Contingency - Destination Marketing Operating Contingency - Non- Dest. Marketing Non Destination Marketing Fund Balance Total Ending Fund Balance (a) (a) A $1.5 million Operating Contingency was established in FY 2024/25 to provide budget authorization in the event of unforeseen expenses occurring during the year. Spending in excess of the five percent calculated amount is intended to utilize existing fund balance for one-time items. (c) Per Financial Policy 10.02, the 25 percent for Other Commitments can be utilized for Operating, Capital, and Transfer Out uses. Please note that portions of the Transfers Out category compose the other areas of the 25 percent allocation. (d) Per Financial Policy 10.02, the 25 percent for Other Commitments cannot have a single commitment exceed $600,000, unless approved by council. The CIP Transfers Out contains a project that exceeds $600,000. Adoption of the budget would serve as approval by council in compliance with Policy 10.02. (b) 221 Table of Contents BUDGET BY FUND | Tourism Development Fund - Destination Marketing Actual 20 23 / 2 4 Beginning Fund Balance Destination Marketing (a) Operating Contingency Total Beginning Fund Balance R e v e n ue s Transient Occupancy Tax Interest Earnings Subtotal Total Sources Expenditures Destination Marketing Contract - 45% Destination Marketing - 5% (b) TOTAL OPERATING BUDGET Total Uses Sources Over/(Under) Uses Ending Fund Balance Destination Marketing (a) Operating Contingency Total Ending Fund Balance Subtotal Adopted 20 24 / 2 5 Forecast 20 24 / 2 5 Adopted 20 25 / 2 6 7,276,338 7 , 27 6, 3 38 6,026,858 1,500,000 7, 5 26 , 858 5,713,284 1,500,000 7 , 21 3, 2 84 6,221,667 1,500,000 7, 7 21 , 667 17,298,658 159,909 17,458,567 15,780,673 190,533 15,971,206 16,902,742 190,533 17,093,275 16,500,000 204,708 16,704,708 17 , 458 , 56 7 1 5, 97 1, 2 06 1 7 ,0 9 3 , 2 7 5 16 , 70 4, 7 08 15,576,628 1,944,994 17,521,621 14,202,606 1,372,424 15,575,030 15,212,468 1,372,424 16,584,892 14,850,000 2,343,722 17,193,722 17,521,621 15,575,030 16,584,892 17,193,722 17 , 521 , 62 1 1 5, 5 75, 0 30 16 , 584 , 89 2 1 7, 19 3, 7 22 (6 3 , 0 5 4 ) 39 6, 1 76 5 08 , 383 (4 8 9 , 0 1 4 ) 7,213,284 7, 2 13, 2 84 6,423,034 1,500,000 7 , 923 , 03 4 6,221,667 1,500,000 7, 7 21, 6 67 5,732,653 1,500,000 7 , 232 , 65 3 (a) A $1.5 million Operating Contingency was established in FY 2024/25 to provide budget authorization in the event of unforeseen expenses occurring during the year. (b) Spending in excess of the five percent calculated amount is intended to utilize existing fund balance for one-time items. 222 Table of Contents BUDGET BY FUND | Tourism Development Fund - Destination Marketing Adopted 20 25 / 2 6 Beginning Fund Balance Destination Marketing Forecast 20 26 / 2 7 Forecast 20 27 / 2 8 Forecast 20 28 / 2 9 Forecast 20 29 / 3 0 6,221,667 1,500,000 7, 72 1, 6 67 5,732,653 1,500,000 7, 2 32 , 65 3 5,562,053 1,500,000 7 , 06 2, 0 53 5,426,553 1,500,000 6, 9 26 , 55 3 5,353,353 1,500,000 6, 8 53 , 35 3 16,500,000 204,708 16,704,708 16,863,000 203,900 17,066,900 17,368,900 200,200 17,569,100 17,976,800 200,900 18,177,700 18,695,900 208,400 18,904,300 16 , 70 4, 7 08 1 7, 0 66 , 900 17 , 56 9, 10 0 1 8, 1 77, 7 00 18 , 90 4, 3 00 14,850,000 2,343,722 17,193,722 15,176,700 2,060,800 17,237,500 15,632,000 2,072,600 17,704,600 16,179,100 2,071,800 18,250,900 16,826,300 2,078,800 18,905,100 17,193,722 17,237,500 17,704,600 18,250,900 18,905,100 Total Uses 17 , 19 3, 7 22 1 7, 2 37 , 500 17 , 70 4, 60 0 1 8 , 2 5 0 ,9 0 0 18 , 90 5, 1 00 Sources Over/(Under) Uses (4 8 9 , 0 1 4 ) ( 1 70 , 600 ) (1 3 5 , 5 0 0 ) ( 7 3, 2 00 ) (8 0 0 ) 5,732,653 1,500,000 7, 2 32 , 65 3 5,562,053 1,500,000 7 , 06 2, 0 53 5,426,553 1,500,000 6, 9 26 , 553 5,353,353 1,500,000 6 , 85 3, 35 3 5,352,553 1,500,000 6, 8 52 , 55 3 (a) Operating Contingency Total Beginning Fund Balance R e v e n ue s Transient Occupancy Tax Interest Earnings Subtotal Total Sources Expenditures Destination Marketing Contract - 45% Destination Marketing - 5% (b) TOTAL OPERATING BUDGET Ending Fund Balance Destination Marketing (a) Operating Contingency Total Ending Fund Balance (a) (b) Subtotal A $1.5 million Operating Contingency was established in FY 2024/25 to provide budget authorization in the event of unforeseen expenses occurring during the year. Spending in excess of the five percent calculated amount is intended to utilize existing fund balance for one-time items. 223 Table of Contents BUDGET BY FUND | Tourism Development Fund - Non-Destination Marketing Actual 2023/24 Beginning Fund Balance Operating Contingency Non-Destination Marketing Fund Balance Total Beginning Fund Balance A d op te d 2024/25 Forecast 2024/25 A d op te d 2025/26 2,500,000 11,538,505 1 4 ,0 3 8 ,5 0 5 2,500,000 5,819,310 8 ,3 19 , 3 10 2,500,000 7,927,637 1 0 ,4 27 ,6 3 7 2,500,000 4,491,716 6 , 9 91 ,7 16 S u b t o t al 17,298,657 3,932,551 337,726 14,373 2 1 ,5 8 3 , 3 0 7 15,780,673 3,245,605 496,881 25,000 1 9 ,5 4 8 , 1 5 9 16,902,743 3,245,605 496,881 25,000 2 0 ,6 7 0 ,2 2 9 16,500,000 3,657,800 388,029 15,000 2 0 , 5 6 0 ,8 2 9 - 1,000,000 1 ,0 0 0 ,0 0 0 - S u b t o t al 1,703,401 1 ,7 0 3 , 4 0 1 - 2 3 ,2 8 6 ,7 0 8 1 9 ,5 48 ,1 59 2 1 ,6 7 0 , 2 29 2 0 ,5 60 ,8 29 903,082 2,309,656 1,985,017 5 ,1 9 7 , 7 5 6 1,260,657 2,840,521 2,189,000 6 ,2 9 0 , 1 7 8 1,263,284 2,640,521 2,389,000 6 ,2 9 2 ,8 0 5 1,318,641 2,970,004 2,789,041 7 , 0 7 7 ,6 8 6 5,197,756 6,290,178 6,292,805 7,077,686 8,876,199 4,982,379 3,689,565 4,151,678 2 1 ,6 9 9 , 8 2 0 6,450,000 4,974,787 2,031,900 3,787,362 1 7 ,2 4 4 , 0 4 9 7,750,000 4,974,787 2,031,900 4,056,658 1 8 ,8 1 3 ,3 4 5 1,676,263 4,985,387 1,533,800 3,960,000 1 2 , 1 5 5 ,4 5 0 T o t a l Us e s 2 6 ,8 9 7 ,5 7 7 2 3 ,5 34 ,2 27 2 5 ,1 0 6 , 1 50 1 9 ,2 33 ,1 36 Sources Over/(Under) Uses (3 , 6 1 0 , 8 6 8 ) (3 , 9 8 6 , 0 6 8 ) (3 , 4 3 5 , 9 2 1 ) 1 , 32 7 ,6 9 3 Ending Fund Balance Operating Contingency Non-Destination Marketing Fund Balance Total Ending Fund Balance 2,500,000 7,927,637 1 0 ,4 2 7 ,6 3 7 2,500,000 1,833,242 4 ,3 33 ,2 42 2,500,000 4,491,716 6 ,9 91 ,7 16 2,500,000 5,819,409 8 ,3 19 ,4 09 Revenues Transient Occupancy Tax Property Rental Interest Earnings Miscellaneous (a) Transfers In (b) CIP (c) Operating Total Sources Expenditures Administration and Research - 4% Event Retention and Development - 9% Other Commitments - 25% (d) S u b t o t al TOTAL OPERATING BUDGET Transfers Out (e) CIP Debt Service MPC Bonds Operating GF Transfer - 12% S u b t o t al (a) The Non-Destination Marketing plan composes 50 percent of the Transient Occupancy Tax Revenues. Please note that the 4 percent, 9 percent, 25 percent, and 12 percent are calculated off of 100 percent of Transient Occupancy Tax Revenues. (b) In FY 2023/24, savings from the WestWorld Tent Refurbishment capital project were transferred back to the original funding source. (c) FY 2024/25 includes the return of a prior Transfer Out to Facilities for the Arizona State Route 101 Traffic Interchange project which was transferred out to the CIP instead. (d) Per Financial Policy 10.02, the 25 percent for Other Commitments can be utilized for Operating, Capital, and Transfer Out uses. Please note that portions of the Transfers Out category compose the other areas of the 25 percent allocation. (e) Per Financial Policy 10.02, the 25 percent for Other Commitments cannot have a single commitment exceed $600,000, unless approved by council. The CIP Transfers Out contains a project that exceeds $600,000. Adoption of the budget serves as approval by council in compliance with Policy 10.02. 224 Table of Contents BUDGET BY FUND | Tourism Development Fund - Non-Destination Marketing A d op te d 2025/26 Beginning Fund Balance Operating Contingency Non-Destination Marketing Fund Balance Total Beginning Fund Balance Forecast 2026/27 Forecast 2027/28 Forecast 2028/29 Forecast 2029/30 2,500,000 4,491,716 6 , 99 1 ,7 1 6 2,500,000 5,819,409 8 , 3 19 ,4 09 2,500,000 7,391,409 9 ,8 91 ,4 09 2,500,000 9,513,309 1 2 ,0 13 ,3 09 2,500,000 14,345,509 1 6 ,8 4 5 ,5 09 S u b t o t al 16,500,000 3,657,800 388,029 15,000 2 0 , 5 6 0 ,8 2 9 16,863,000 3,749,200 377,300 15,000 2 1 ,0 0 4 ,5 0 0 17,368,900 3,843,000 351,800 15,000 2 1 ,5 7 8 , 7 0 0 17,976,800 3,958,300 333,700 15,000 2 2 ,2 8 3 ,8 0 0 18,695,900 4,077,000 327,100 15,000 2 3 ,1 1 5 , 0 0 0 S u b t o t al - - - - - 2 0 , 56 0 ,8 2 9 2 1 , 0 04 ,5 00 2 1 ,5 78 ,7 00 2 2 ,2 83 ,8 00 2 3 ,1 1 5 ,0 00 1,318,641 2,970,004 2,789,041 7 , 0 7 7 ,6 8 6 1,346,200 3,035,400 2,725,800 7 ,1 0 7 ,4 0 0 1,384,800 3,126,400 2,125,800 6 ,6 3 7 , 0 0 0 1,432,700 3,235,800 1,925,800 6 ,5 9 4 ,3 0 0 1,488,700 3,365,300 1,925,900 6 , 7 7 9 ,9 0 0 7,077,686 7,107,400 6,637,000 6,594,300 6,779,900 1,676,263 4,985,387 1,533,800 3,960,000 1 2 , 1 5 5 ,4 5 0 1,771,500 4,972,200 1,534,280 4,047,120 1 2 ,3 2 5 ,1 0 0 2,125,800 4,990,800 1,534,664 4,168,536 1 2 ,8 1 9 , 8 0 0 5,008,200 1,534,668 4,314,432 1 0 ,8 5 7 ,3 0 0 4,127,200 534,684 4,487,016 9 , 1 4 8 ,9 0 0 T o t a l Us e s 1 9 , 23 3 ,1 3 6 1 9 , 4 32 ,5 00 1 9 ,4 56 ,8 00 1 7 ,4 51 ,6 00 1 5 ,9 2 8 ,8 00 Sources Over/(Under) Uses 1 , 32 7 ,6 9 3 1 , 5 72 ,0 00 2 ,1 21 ,9 00 4 ,8 32 ,2 00 7 ,1 8 6 , 20 0 Ending Fund Balance Operating Contingency Non-Destination Marketing Fund Balance Total Ending Fund Balance 2,500,000 5,819,409 8 , 3 19 ,4 09 2,500,000 7,391,409 9 ,8 91 ,4 09 2,500,000 9,513,309 1 2 ,0 1 3 , 3 09 2,500,000 14,345,509 1 6 ,8 45 ,5 09 2,500,000 21,531,709 2 4 ,0 3 1 ,7 09 Revenues Transient Occupancy Tax Property Rental Interest Earnings Miscellaneous (a) Transfers In (b) CIP (c) Operating Total Sources Expenditures Administration and Research - 4% Event Retention and Development - 9% Other Commitments - 25% (b) S u b t o t al TOTAL OPERATING BUDGET Transfers Out (c) CIP Debt Service MPC Bonds Operating GF Transfer - 12% S u b t o t al (a) The Non-Destination Marketing plan composes 50 percent of the Transient Occupancy Tax Revenues. Please note that the 4 percent, 9 percent, 25 percent, and 12 percent are calculated off of 100 percent of Transient Occupancy Tax Revenues. (b) Per Financial Policy 10.02, the 25 percent for Other Commitments can be utilized for Operating, Capital, and Transfer Out uses. Please note that portions of the Transfers Out category compose the other areas of the 25 percent allocation. (c) Per Financial Policy 10.02, the 25 percent for Other Commitments cannot have a single commitment exceed $600,000, unless approved by council. The CIP Transfers Out contains a project that exceeds $600,000. Adoption of the budget serves as approval by council in compliance with Policy 10.02. 225 Table of Contents BUDGET BY FUND | Tourism Development Fund TOURISM DEVELOPMENT FUND SOURCES There are two main sources for the Tourism Development Fund: Transient Occupancy Tax and Property Rental, which is lease revenue from the Fairmont Scottsdale Princess Hotel. Additionally, there may be Interest Earnings, Miscellaneous revenue related to tourism events, and Transfers In resulting from completed capital projects funded by the Tourism Development Fund. More specific information on these sources is detailed below. TRANSIENT OCCUPANCY TAX FY 2021/22 to FY 2027/28 (in millions) Transient Occupancy Tax reflects a voter-approved tax of five percent on hotel and motel room rentals, as well as on shortterm rentals, in addition to the sales tax. The FY 2025/26 budgeted revenue of $33.0 million is $1.4 million higher than the FY 2024/25 amount. Future years' budgets assume a return to pre-pandemic trends while accounting for the impact of inflation in room rates. PROPERTY RENTAL FY 2021/22 to FY 2027/28 (in millions) The Fairmont Scottsdale Princess Hotel has a ground lease agreement with the City of Scottsdale. Per said agreement, the Fairmont Scottsdale Princess Hotel pays a rate of 2.0 percent of the adjusted gross revenue above $100.0 million in addition to a set amount of $1.5 million annually through the end of the lease. The FY 2025/26 Property Rental budgeted revenue of $3.7 million is $0.5 million higher than the FY 2024/25 adopted budget. FORECAST 226 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Tourism Development Fund INTEREST EARNINGS FY 2021/22 to FY 2027/28 (in millions) Interest Earnings are generated on idle Tourism Development Fund cash balances throughout the year. This revenue is a function of the relationship between the city’s available cash balance and the interest rate. The city earns interest on funds through various investment vehicles in accordance with Arizona Revised Statutes and City Ordinance. The city’s investment policy stresses safety above yield. Interest earnings applicable to bond proceeds and the Capital Improvement Plan (CIP) accrue to the CIP budget and are not included in Tourism Development Fund revenues. Interest Earnings revenue is budgeted at $0.6 million in FY 2025/26. FY 2021/22 to FY 2027/28 MISCELLANEOUS Miscellaneous includes additional sources that may be collected and are not attributable to one of the specific sources previously noted. Beginning in FY 2021/22, a series of micro-events are offered for Scottsdazzle. The FY 2025/26 Miscellaneous budgeted revenue is set at $15,000. TRANSFERS IN Transfers In is the authorized movement of cash or other resources from other funds and/or capital projects. FORECAST BUDGET ACTUAL/FORECAST* 227 Table of Contents BUDGET BY FUND | Tourism Development Fund CIP FY 2021/22 to FY 2027/28 (in millions) Transfers In from the Capital Improvement Plan (CIP) include remaining funds from completed capital projects that were transferred back to the Tourism Development Fund operating budget. The FY 2023/24 CIP Transfers In correspond to the savings in the WestWorld Tent Refurbishment capital project that were transferred to the original funding source. OPERATING FY 2021/22 to FY 2027/28 (in millions) Operating Transfers In are composed of non-capital funding being transferred between funds. The FY 2024/25 actual of $1.0 million represents a transfer in to correct funding that was improperly transferred out to the General Fund for a public art wall painting at State Route 101. The corresponding transfer out can be seen under the Transfer Out section. TOURISM DEVELOPMENT FUND USES Tourism Development Fund uses are presented by use of funds according to Financial Policy No. 10, that establishes the allocation of Transient Occupancy Tax collections to different tourism-related purposes. FORECAST 228 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Tourism Development Fund DESTINATION MARKETING - 45% FY 2021/22 to FY 2027/28 (in millions) Per Financial Policy No. 10, 50 percent of the Transient Occupancy Tax (Bed Tax) received by the city is used for destination marketing purposes. Prior to FY 2022/23, the totality of this allocation was utilized through a contract with Experience Scottsdale. Beginning in FY 2022/23, per the new Experience Scottsdale Destination Marketing Services Agreement approved by City Council on June 21, 2022, the payment to Experience Scottsdale will be equal to 45 percent of Bed Tax collections. The FY 2025/26 adopted budget of $14.9 million is an increase of $0.7 million compared to the FY 2024/25 adopted budget. See Destination Marketing schedule for further detail. DESTINATION MARKETING - 5% FY 2021/22 to FY 2027/28 (in millions) Destination Marketing - 5% is the portion of bed tax allocated for destination marketing per Financial Policy No. 10 that is used for in-house destination marketing efforts. The FY 2025/26 budget is $1.6 million, which is an increase of $0.5 million from the FY 2024/25 adopted budget. The increase is largely due to the budgeted use of accumulated fund balance for one-time items in FY 2025/26. See Destination Marketing schedule for further detail. ADMINISTRATION AND RESEARCH - 4% FY 2021/22 to FY 2027/28 (in millions) Financial Policy No. 10 allows for four percent of the Transient Occupancy Tax revenues to be allocated for tourism-related administration and research expenses. The FY 2025/26 adopted budget of $1.3 million is flat when compared to the FY 2024/25 adopted budget. FORECAST BUDGET ACTUAL/FORECAST* 229 Table of Contents BUDGET BY FUND | Tourism Development Fund EVENT RETENTION AND DEVELOPMENT - 9% FY 2021/22 to FY 2027/28 (in millions) Per Financial Policy No. 10, nine percent of the Transient Occupancy Tax received by the city is used for Event Retention and Development. The funds are allocated towards four programs: new event development, community events, matching marketing and event venue fee. The FY 2025/26 adopted budget of $3.0 million is a decrease of $0.6 million compared to the FY 2024/25 adopted budget mainly due to the reclassification of Canal Convergence funding, now being housed under the Other Commitments - 25%. OTHER COMMITMENTS - 25% FY 2021/22 to FY 2027/28 (in millions) Financial Policy No. 10 allows for 25 percent plus the lease payments on the Fairmont Scottsdale Princess Resort, or the balance of the remaining Tourism Development Fund revenues, to be allocated for tourism-related operating expenses, capital projects, and/or operating impacts that are directly associated with tourism-related capital projects, in the form of one-time commitments or multi-year annual commitments, not to exceed $0.6 million per project unless otherwise approved by City Council. The FY 2025/26 adopted budget of $2.8 million includes: 1) $0.8 million for Canal Convergence; 2) $0.2 million for seasonal and special events; 3) $1.3 million of operating and one-time capital funding for the Museum of the West; 4) $0.3 million of funding for Tourism Strategic Plan support; and 5) $0.1 million to purchase signage and kiosks for Historic Old Town Scottsdale. TRANSFERS OUT Transfers Out is the authorized movements of cash or other resources to other funds and/or capital projects. The total amount of Transfers Out for FY 2025/26 is $12.2 million. More specific information is detailed below. FORECAST 230 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Tourism Development Fund CIP FY 2021/22 to FY 2027/28 (in millions) The FY 2025/26 $1.7 million budget includes transfers to the CIP to fund the following capital projects: 1) 45 - Renovate WestWorld Horse Barns to Increase Rentable Space ($1.5 million); and 2) McCormick-Stillman Railroad Park Signage ($0.2 million). DEBT SERVICE MPC BONDS FY 2021/22 to FY 2027/28 (in millions) Debt Service MPC Bonds is a transfer out to the Debt Service Fund for the debt issued as Municipal Property Corporation (MPC) bonds related to the acquisition of 80 acres of land for WestWorld, the construction of the Tony Nelssen Equestrian Center at WestWorld, the construction of the Scottsdale Museum of the West, and the renovation of the Scottsdale Stadium. The FY 2025/26 adopted budget is $5.0 million. OPERATING FY 2021/22 to FY 2027/28 (in millions) Operating Transfers Out for FY 2025/26 adopted budget is $1.5 million for the following: 1) $0.5 million for operational support at WestWorld; 2) $1.0 million for the payback to the General Fund for the $5.0 million contribution for the Scottsdale Stadium Renovations Phase 2; 3) $25,000 to support the Sister Cities Association partnership; and 4) $8,800 to support the Short Term Rental Program Enforcement. FORECAST BUDGET ACTUAL/FORECAST* 231 Table of Contents BUDGET BY FUND | Tourism Development Fund GF TRANSFER - 12% FY 2021/22 to FY 2027/28 (in millions) Financial Policy No. 10 allocates 12 percent of the transient lodging/bed tax revenues to a transfer to the General Fund. The FY 2025/26 adopted budget of $4.0 million is an increase of $0.2 million when compared to the FY 2024/25 adopted budget. TOURISM DEVELOPMENT FUND ENDING BALANCE Fund balance protects the city’s financial condition and provides for unexpected economic challenges. The specific make-up of the Tourism Development Fund ending balance is noted below. DESTINATION MARKETING FUND BALANCE FY 2021/22 to FY 2027/28 (in millions) Per Financial Policy No. 10, 50 percent of the Transient Occupancy Tax (Bed Tax) received by the city is used for destination marketing purposes. Destination Marketing holds the portion of the ending fund balance resulting from unspent destination marketing allocations, excluding a destination marketing Operating Contingency of $1.5 million. The FY 2025/26 Tourism Development Fund Destination Marketing fund balance is $5.7 million. FORECAST 232 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Tourism Development Fund OPERATING CONTINGENCY - DESTINATION MARKETING FY 2021/22 to FY 2027/28 (in millions) Operating Contingency - Destination Marketing is budgeted in FY 2025/26 at $1.5 million for destination marketing related unforeseen expenses that may occur during the fiscal year. Contingency funds are utilized only after all budget options have been considered and requires City Council approval. OPERATING CONTINGENCY - NON-DEST. MARKETING FY 2021/22 to FY 2027/28 (in millions) Operating Contingency - Non-Destination Marketing is budgeted in FY 2025/26 at $2.5 million of budget authorization for non-destination marketing related unforeseen expenses that may occur during the fiscal year. Contingency funds are utilized only after all budget options have been considered and requires City Council approval. FORECAST BUDGET ACTUAL/FORECAST* 233 Table of Contents BUDGET BY FUND | Tourism Development Fund NON-DESTINATION MARKETING FUND BALANCE FY 2021/22 to FY 2027/28 (in millions) Non-Destination Marketing Fund Balance accounts for any funds remaining after the designation of all other reserves/uses for Non-Destination Marketing purposes. The FY 2025/26 Non-Destination Marketing Fund Balance is $5.8 million. FORECAST 234 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund FUND PURPOSE The State of Arizona requires the city to establish and maintain an accounting for Highway User Tax revenue. The Transportation Fund receives and expends the city’s allocation of the Arizona Highway User Tax which is allocated based on the official U.S. Census Bureau population estimate, as directed by State Statute. These monies must be used for street construction, reconstruction, or maintenance. The fund also accounts for other transportation related revenues as well as for the 1989 voter approved Sales Tax - Transportation of 0.20 percent, which is dedicated funding for transportation improvements and operations. The 2018 voter approved Sales Tax – Transportation of 0.10 percent of the city’s sales tax dedicated solely to the Arterial Life Cycle Program transportation capital project is being recorded directly in the Capital Improvement Plan and is not reflected in this section. Transportation Fund Sources (% to Total) $56.9 Million Transportation Fund Uses (% to Total) $61.5 Million Rounding differences may occur. 235 Table of Contents BUDGET BY FUND | Transportation Fund Summary Actual 20 23 /2 4 Adopted 20 24 /2 5 Forecast 20 24 /2 5 Adopted 20 25 /2 6 500,000 3,230,530 43,783,660 4 7 ,5 1 4 ,1 9 0 1,000,000 3,230,530 33,291,622 3 7 ,5 2 2 , 1 5 2 1,000,000 3,230,530 34,617,009 3 8 ,8 4 7 ,5 3 9 1,000,000 3,450,395 26,360,353 3 0 ,8 1 0 ,7 4 8 Subtotal 33,635,523 18,742,665 2,562,415 610,192 354,282 212,217 5,708 56,123,003 31,719,900 19,344,049 3,747,159 610,000 89,556 31,200 5,844 55,547,708 34,174,105 19,344,049 3,747,159 610,000 89,556 31,200 5,844 58,001,913 33,618,917 19,537,489 2,942,285 610,000 221,734 12,100 5,844 56,948,369 - Subtotal - - 205,300 205,300 - 5 6 ,1 2 3 ,0 0 3 5 5 ,5 4 7 ,7 0 8 5 8 ,2 0 7 , 2 1 3 5 6 ,9 4 8 ,3 6 9 8,978,973 16,776,910 1,339,729 2,504,646 29,600,258 10,812,917 18,398,441 1,628,215 1,704,550 243,879 (368,136) 32,419,866 10,602,260 18,398,441 1,628,215 1,704,550 214,364 (368,136) 32,179,694 13,124,523 20,287,020 1,503,299 2,267,017 268,664 (368,136) 37,082,387 29,600,258 32,419,866 32,179,694 37,082,387 34,917,762 271,634 35,189,396 33,965,051 99,259 34,064,310 33,965,051 99,259 34,064,310 24,409,457 24,409,457 Total Uses 6 4 ,7 8 9 ,6 5 4 6 6 ,4 8 4 , 1 7 6 6 6 ,2 4 4 ,0 0 4 6 1 ,4 9 1 ,8 4 4 Sources Over/(Under) Uses (8 , 6 6 6 , 6 5 1 ) (1 0 , 9 3 6 , 4 6 8 ) (8 , 0 3 6 , 7 9 1 ) ( 4 ,5 4 3 ,4 7 5 ) Ending Fund Balance Operating Contingency Operating Reserve Transportation Fund Balance Total Ending Fund Balance 500,000 3,230,530 35,117,009 3 8 ,8 4 7 ,5 3 9 752,843 3,241,987 22,590,854 2 6 ,5 8 5 ,6 8 4 752,843 3,241,987 26,815,918 3 0 ,8 1 0 ,7 4 8 1,000,000 3,708,239 21,559,034 2 6 ,2 6 7 ,2 7 3 B e g in n in g F un d B a l a nc e Operating Contingency Operating Reserve Transportation Fund Balance Total Beginning Fund Balance R e v e nu e s Sales Tax - Transportation (0.20%) Highway User Tax Interest Earnings Local Transportation Assistance Fund Intergovernmental Miscellaneous Property Rental Transfers In CIP(a) - Total Sources Expenditures Personnel Services Contractual Services Commodities Capital Outlays Personnel Programs (b) Operating Impacts Savings from Vacant Positions Subtotal TOTAL OPERATING BUDGET Transfers Out CIP CIP Technology Subtotal (a) (b) Per Council direction, CIP Transportation Fund Contingency was transferred to Operating for the purchase of two street sweepers. Includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. 236 - Table of Contents BUDGET BY FUND | Transportation Fund Five-Year Financial Forecast Adopted 20 25 /2 6 Forecast 20 26 /2 7 Forecast 20 27 /2 8 1,000,000 3,450,395 26,360,353 3 0 ,8 1 0 ,7 4 8 1,000,000 3,708,239 21,559,034 2 6 , 2 6 7 ,2 7 3 1,000,000 3,820,340 8,424,833 1 3 ,2 4 5 ,1 7 3 1,000,000 3,989,730 62,043 5 ,0 5 1 ,7 7 3 1,000,000 4,074,010 658,963 5 , 7 3 2 ,9 7 3 Subtotal 33,618,917 19,537,489 2,942,285 610,000 221,734 12,100 5,844 56,948,369 34,637,700 19,732,900 2,936,600 610,000 226,200 7,100 5,800 58,156,300 35,684,400 19,930,200 2,777,900 610,000 230,700 7,100 5,800 59,246,100 36,940,000 20,129,500 2,663,600 610,000 235,300 7,100 5,800 60,591,300 38,424,800 20,330,800 2,215,900 610,000 240,000 7,100 5,800 61,834,400 Subtotal - - - - - 5 6 ,9 4 8 , 3 6 9 5 8 ,1 5 6 ,3 0 0 5 9 ,2 4 6 ,1 0 0 6 0 ,5 9 1 ,3 0 0 6 1 ,8 3 4 ,4 0 0 13,124,523 20,287,020 1,503,299 2,267,017 268,664 (368,136) 37,082,387 13,662,900 20,592,200 1,533,400 1,961,100 273,700 556,400 (376,300) 38,203,400 14,705,200 21,113,000 1,524,200 2,005,000 278,100 656,300 (384,500) 39,897,300 14,775,600 21,809,500 1,559,000 2,049,600 283,100 656,300 (393,000) 40,740,100 15,410,900 22,551,400 1,594,400 2,095,700 288,400 695,300 (401,600) 42,234,500 37,082,387 38,203,400 39,897,300 40,740,100 42,234,500 24,409,457 24,409,457 32,975,000 32,975,000 27,542,200 27,542,200 19,170,000 19,170,000 19,662,000 19,662,000 Total Uses 6 1 ,4 9 1 ,8 4 4 7 1 , 1 7 8 ,4 0 0 6 7 ,4 3 9 ,5 0 0 5 9 ,9 1 0 ,1 0 0 6 1 ,8 9 6 ,5 0 0 Sources Over/(Under) Uses (4 , 5 4 3 , 4 7 5 ) (1 3 , 0 2 2 , 1 0 0 ) (8 , 1 9 3 , 4 0 0 ) 6 8 1 ,2 0 0 (6 2 , 1 0 0 ) Ending Fund Balance Operating Contingency Operating Reserve Transportation Fund Balance Total Ending Fund Balance 1,000,000 3,708,239 21,559,034 2 6 ,2 6 7 ,2 7 3 1,000,000 3,820,340 8,424,833 1 3 ,2 4 5 ,1 7 3 1,000,000 3,989,730 62,043 5 ,0 5 1 , 7 7 3 1,000,000 4,074,010 658,963 5 ,7 3 2 ,9 7 3 1,000,000 4,223,450 447,423 5 , 6 7 0 ,8 7 3 B e g in n in g F un d B a l a nc e Operating Contingency Operating Reserve Transportation Fund Balance Total Beginning Fund Balance R e v e nu e s Sales Tax - Transportation (0.20%) Highway User Tax Interest Earnings Local Transportation Assistance Fund Intergovernmental Miscellaneous Property Rental Transfers In CIP Total Sources Expenditures Personnel Services Contractual Services Commodities Capital Outlays Personnel Programs (a) Operating Impacts Savings from Vacant Positions Subtotal TOTAL OPERATING BUDGET Transfers Out CIP CIP Technology Subtotal (a) Forecast 20 28 /2 9 Forecast 20 29 /3 0 Includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. 237 Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund TRANSPORTATION FUND SOURCES Transportation Fund sources for FY 2025/26 equal $56.9 million which is an increase of $1.4 million from the FY 2024/25 adopted budget primarily related to strong consumer demand and spending reflected mostly in Sales Tax - Transportation (0.20%) revenue. The same methodology for developing the Sales Tax budgeted in the General Fund is also used for the Transportation Fund. SALES TAX - TRANSPORTATION (0.20%) FY 2021/22 to FY 2027/28 (in millions) Sales Tax - Transportation (0.20%) represents the 0.20 percent of the city’s sales tax dedicated solely to transportation. Although the rate is the same for both the Transportation and 1995 Preservation sales taxes, they generate different revenues because each is authorized under different legal provisions. The adopted FY 2025/26 budget of $33.6 million represents an increase of $1.9 million, or 6.0 percent, over the FY 2024/25 adopted budget due to strong consumer demand and spending. HIGHWAY USER TAX FY 2021/22 to FY 2027/28 (in millions) Highway User Tax, also known as the gas tax or the Highway User Revenue Fund (HURF), is distributed by the State of Arizona. The state constitution requires that all highway user revenue be used solely for street, highway, or transit purposes. Cities and towns receive 27.5 percent of the highway user revenue fund, of which one half of the monies are distributed based on population of all incorporated cities and towns in the state. The remaining half is distributed based on 'county of origin' of gasoline sales and the relation of the city or town's population to the total incorporated population of Maricopa County. The adopted FY 2025/26 budget of $19.5 million represents a $0.2 million increase from the FY 2024/25 adopted budget. FORECAST 238 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund INTEREST EARNINGS FY 2021/22 to FY 2027/28 (in millions) Interest Earnings are generated on idle Transportation Fund cash balances throughout the year. This revenue is a function of the relationship between the city’s available cash balance and the interest rate. The city earns interest on funds through various investment vehicles in accordance with Arizona Revised Statutes and City Ordinance. The city’s investment policy stresses safety above yield. Interest Earnings revenue is budgeted at $2.9 million in FY 2025/26, a decrease of $0.8 million from the prior year. LOCAL TRANSPORTATION ASSISTANCE FUND FY 2021/22 to FY 2027/28 (in millions) Local Transportation Assistance Fund supports the development and operation of a comprehensive multi-modal public transportation program in Arizona. The funding for this program comes from lottery proceeds and it is distributed to cities and towns through an annual application process. The amounts available to cities and towns are capped based on population. The FY 2025/26 budget for this revenue is $0.6 million, which represents the entire allocation available to the city. INTERGOVERNMENTAL FY 2021/22 to FY 2027/28 (in millions) Intergovernmental represents the city’s allocation of the halfcent sales tax for transportation improvements approved in Proposition 400 by Maricopa County voters in November 2004. This revenue, through the Transportation Fund, funds the American's with Disabilities Act (ADA) Cab Connection Rides program, which addresses the transportation needs of people with disabilities within the city. The FY 2025/26 budget is $0.2 million, which is an increase of $0.1 million compared to the FY 2024/25 adopted budget. FORECAST BUDGET ACTUAL/FORECAST* 239 Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund MISCELLANEOUS FY 2021/22 to FY 2027/28 Miscellaneous includes various revenues the city receives in the Transportation Fund during any given year that are not attributable to one of the specific revenue categories previously noted. The FY 2025/26 budget of $12,100 represents a decrease of $19,100 from the FY 2024/25 adopted budget. PROPERTY RENTAL FY 2021/22 to FY 2027/28 Property Rental represents revenue received from a transportation services business use of office space at the South Corporation Yard. The adopted FY 2025/26 budget for Property Rental is $5,844. FORECAST 240 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund TRANSFERS IN Transfers In is the authorized movement of cash or other resources from other funds. There are no Transfers In budgeted for FY 2025/26. CIP FY 2021/22 to FY 2027/28 (in millions) There were $0.2 million of CIP Transfers In during FY 2024/25. Per council direction, CIP Transportation Fund Contingency was transferred to Operating for the purchase of two street sweepers. TRANSPORTATION FUND USES The Transportation Fund Uses for FY 2025/26 are budgeted at $61.5 million and represent expenses by division, additional nondivisional operating categories, and transfers out to the CIP. This is a decrease of$5.0 million compared to the FY 2024/25 adopted budget. PERSONNEL SERVICES FY 2021/22 to FY 2027/28 (in millions) Personnel Services includes the salaries and wages plus the city’s contribution for fringe benefits such as retirement, social security, health, and workers’ compensation insurance. It is reduced by vacancy savings, but increased for medical and vacation leave accrual payouts that are made at the time of separation from the city. Personnel Services also include payfor-performance and compensation adjustments. Personnel Services has an adopted budget of $13.1 million for FY 2025/26, which is a $2.3 million increase compared to the FY 2024/25 adopted budget. FORECAST BUDGET ACTUAL/FORECAST* 241 Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund CONTRACTUAL SERVICES FY 2021/22 to FY 2027/28 (in millions) Contractual Services includes expenditures for services performed by firms, individuals, or other city departments. The FY 2025/26 adopted budget of $20.3 million is a $1.9 million increase compared to the FY 2024/25 adopted budget of $18.4 million. COMMODITIES FY 2021/22 to FY 2027/28 (in millions) Transportation Fund commodity expenses encompass general operating supplies and materials—from protective clothing, repair and replacement parts, and small tools to maintenance materials and minor equipment—along with incidental items like office and furniture supplies, safety incentives, and refreshments. The adopted commodities budget for FY 2025/26 is $1.5 million, which is a decrease of $0.1 million compared to FY 2024/25. PERSONNEL PROGRAMS FY 2021/22 to FY 2027/28 Personnel Programs includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. The FY 2025/26 adopted budget includes $268,664 for Personnel Programs. This represents a $24,785 increase compared to the FY 2024/25 adopted budget which was $243,879. FORECAST 242 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund OPERATING IMPACTS FY 2021/22 to FY 2027/28 (in millions) Operating Impacts is additional future costs associated with Capital Improvement Plan (CIP) projects that impact operating budget such as positions, facilities maintenance, utilities, and annual software maintenance. In FY 2024/25 and years prior, operating impacts have been included at the division level. FY 2026/27 through FY 2027/28 are forecasted at $0.6 million and $0.7 million, respectively. SAVINGS FROM VACANT POSITIONS FY 2021/22 to FY 2027/28 (in millions) The amount of savings achieved from vacant positions for FY 2025/26 is estimated at ($0.4) million. FORECAST BUDGET ACTUAL/FORECAST* 243 Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund TRANSFERS OUT Transfers Out are the authorized movement of cash to other funds and/or capital projects. CIP FY 2021/22 to FY 2027/28 (in millions) Per the FY 2025/26 adopted budget, the city will transfer $24.4 million into the Capital Improvement Plan—sourced from Transportation operating funds (including PAYGO and half of the 0.20% Transportation sales tax per Governing Guidance No. 5) and from the Highway User Revenue Fund—to fund capital projects such as the Pavement Overlay Program. This is a $9.6 million decrease compared to the FY 2024/25 adopted budget. CIP TECHNOLOGY FY 2021/22 to FY 2027/28 (in millions) CIP Technology is the authorized transfer to CIP to fund technology related capital projects. There is no transfer budgeted for FY 2025/26. FORECAST 244 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund TRANSPORTATION FUND ENDING BALANCE Fund balances, contingencies, and reserves protect the city’s financial condition and provide for unexpected economic challenges. The specific make-up of the city’s Transportation Fund Ending Balance is noted in the following: OPERATING CONTINGENCY FY 2021/22 to FY 2027/28 (in millions) Operating Contingency includes $1.0 million of budget authorization in the event that unforeseen expenses occur during the fiscal year. Contingency funds are utilized only after all budget options have been considered and require City Council approval. OPERATING RESERVE FY 2021/22 to FY 2027/28 (in millions) Per Financial Policy No. 2.03, the city's transportation operating reserve shall be 10 percent of the annual Transportation Fund operating budget, and shall be used for unforeseen emergencies or catastrophic impacts to the city related to transportation. The FY 2025/26 Transportation Fund operating reserve is $3.7 million. FORECAST BUDGET ACTUAL/FORECAST* 245 Table of Contents BUDGET BY FUND | Transportation BUDGET BY FUND | Park and Preserve Tax Allocation Fund Fund TRANSPORTATION FUND BALANCE FY 2021/22 to FY 2027/28 (in millions) The Transportation Fund Balance accounts for any remaining funds after the designation of all other reserves/uses. The FY 2025/26 ending transportation fund balance is $21.6 million. Under prudent fiscal management practices, this balance should most appropriately be used for one-time expenditures, not to fund new or to expand programs with ongoing operating expenses. FORECAST 246 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Debt Service Fund FUND PURPOSE The Debt Service Fund accounts for the accumulation of resources and the payment of long-term debt principal and interest that are not serviced by the General, Enterprise, or Special Revenue Funds. Contracts payable and certificates of participation for contractual debt such as sales tax development agreements, are serviced by the General Fund and will vary based on the actual sales tax collections at each development site. The applicable sources, uses, and ending fund balance of the Debt Service Fund are described in further detail in the following sections. Debt Service Fund Sources (% to Total) $78.4 Million Debt Service Fund Uses (% to Total) $78.6 Million Rounding differences may occur. 247 Table of Contents BUDGET BY FUND | Debt Service Fund Summary Actual 20 23 / 24 Adopted 20 24 / 25 Forecast 20 24 / 25 5,055,080 7,291,445 1 2 ,3 4 6 , 5 2 5 5,055,080 5,591,445 1 0 ,6 4 6 , 5 2 5 5,055,079 5,163,899 1 0 ,2 1 8 , 9 7 8 5,057,640 3,803,932 8 , 8 61 , 5 72 Subtotal 35,119,046 5,960 35,125,006 28,615,822 28,615,822 29,741,038 29,741,038 34,851,032 34,851,032 Subtotal 35,463,531 18,743,113 54,206,645 38,817,300 23,699,783 62,517,083 38,849,117 23,699,783 62,548,900 26,406,235 16,449,774 725,000 43,581,009 89 , 3 31 , 6 50 91 , 1 32 , 9 05 9 2, 2 89 , 9 38 7 8 ,4 3 2 , 0 4 1 37,356,475 35,354,393 18,748,329 91,459,197 31,101,005 38,849,117 23,697,222 93,647,344 31,101,005 38,849,117 23,697,222 93,647,344 34,984,366 26,406,235 16,447,187 725,000 78,562,788 91,459,197 93,647,344 93,647,344 78,562,788 Total Uses 9 1 ,4 5 9 , 1 9 7 9 3 ,6 4 7 , 3 4 4 93 , 6 47 , 3 44 7 8 ,5 6 2 , 7 8 8 Sources Over/(Under) Uses (2 , 1 2 7 , 5 4 6 ) (2 , 5 1 4 , 4 3 9 ) ( 1 , 3 57 , 4 06) (1 3 0 , 7 4 7 ) Ending Fund Balance Debt Stabilization Reserve GO Debt Service Reserve - Non Preserve Total Ending Fund Balance 5,055,079 5,163,899 1 0 ,2 1 8 , 9 7 8 5,025,824 3,106,262 8 , 1 32 , 0 86 5,057,640 3,803,932 8 ,8 6 1 , 5 7 2 5,232,388 3,498,437 8 , 7 30 , 8 25 Beginning Fund Balance Debt Stabilization Reserve GO Debt Service Reserve - Non Preserve Total Beginning Fund Balance Re v e nue s Property Tax Interest Income Non-pooled Transfers In Debt Service GO Bonds Debt Service MPC Bonds WIFA Debt (a) Total Sources Debt Service GO Debt Service - Non Preserve GO Debt Service - Preserve MPC Excise Debt WIFA Debt Service (a) Subtotal TOTAL OPERATING BUDGET (a) WIFA debt for WestWorld is supported by Prop 490 revenues. 248 Adopted 20 25 / 26 Table of Contents BUDGET BY FUND | Debt Service Fund Five-Year Financial Forecast Adopted 20 25 / 26 Beginning Fund Balance Debt Stabilization Reserve GO Debt Service Reserve - Non Preserve Total Beginning Fund Balance Forecast 20 26 / 27 Forecast 20 27 / 28 Forecast 20 28 / 29 Forecast 20 29 / 30 5,057,640 3,803,932 8 ,8 6 1 , 5 7 2 5,232,388 3,498,437 8 ,7 3 0 , 8 2 5 5,235,100 3,680,125 8 , 9 15 , 2 25 5,056,193 3,974,732 9 ,0 3 0 , 9 2 5 5,236,443 2,770,782 8 ,0 0 7 ,2 2 5 Subtotal 34,851,032 34,851,032 36,982,900 36,982,900 38,061,900 38,061,900 26,683,900 26,683,900 22,475,100 22,475,100 Subtotal 26,406,235 16,449,774 725,000 43,581,009 17,826,600 16,676,200 2,950,000 37,452,800 115,743,300 19,548,300 3,450,000 138,741,600 20,466,000 3,450,000 23,916,000 12,343,900 3,450,000 15,793,900 7 8 , 4 3 2 ,0 4 1 7 4 , 4 3 5 ,7 0 0 1 7 6 ,8 0 3 ,5 0 0 5 0 ,5 9 9 , 9 0 0 38 , 2 69 , 0 00 34,984,366 26,406,235 16,447,187 725,000 78,562,788 36,801,200 17,826,500 16,673,600 2,950,000 74,251,300 37,947,400 115,742,300 19,548,100 3,450,000 176,687,800 27,707,900 20,465,700 3,450,000 51,623,600 22,950,800 12,831,700 3,450,000 39,232,500 78,562,788 74,251,300 176,687,800 51,623,600 39,232,500 Total Uses 7 8 ,5 6 2 , 7 8 8 74 , 2 51 , 3 00 1 7 6 ,6 8 7 , 8 0 0 51 , 6 23 , 6 00 39 , 2 32 , 5 00 Sources Over/(Under) Uses (1 3 0 , 7 4 7 ) 184 , 4 00 1 1 5 ,7 0 0 ( 1 , 0 23 , 7 00) ( 9 6 3 ,5 0 0 ) Ending Fund Balance Debt Stabilization Reserve GO Debt Service Reserve - Non Preserve Total Ending Fund Balance 5,232,388 3,498,437 8 , 7 30 , 8 25 5,235,100 3,680,125 8 ,9 1 5 , 2 2 5 5,056,193 3,974,732 9 , 0 30 , 9 25 5,236,443 2,770,782 8 , 0 07 , 2 25 4,748,645 2,295,080 7 ,0 4 3 ,7 2 5 Re v e nue s Property Tax Interest Income Non-pooled Transfers In Debt Service GO Bonds (a) Debt Service MPC Bonds WIFA Debt (b) Total Sources Debt Service GO Debt Service - Non Preserve GO Debt Service - Preserve (a) MPC Excise Debt WIFA Debt Service (b) TOTAL OPERATING BUDGET (a) (b) Subtotal The GO Bonds will be retired early, with repayment expected to be completed in FY 2027/28. WIFA debt for WestWorld is supported by Prop 490 revenues. 249 Table of Contents BUDGET BY FUND | Debt Service Fund DEBT SERVICE FUND SOURCES Debt Service Fund sources for FY 2025/26 equal $78.4 million. Sources include Property Tax, and Transfers In. PROPERTY TAX FY 2021/22 to FY 2027/28 (in millions) Property Tax represents the secondary portion of the property tax that is limited by state statue and levied to repay debt service on voter-approved General Obligation (GO) bonds. The city issues General Obligation bonds for improvements to streets, bridges, transportation systems, parks and trails, drainage systems, and public safety and municipal facilities. The FY 2025/26 levy amount (revenue) is $34.9 million. INTEREST INCOME NON-POOLED FY 2021/22 to FY 2027/28 Interest Income Non-pooled is interest revenue derived from Municipal Property Corporation (MPC) Bonds, which is received on an irregular basis. TRANSFERS IN Transfers In is the authorized movement of cash or other resources from other funds and/or capital projects. The FY 2025/26 adopted budget includes $43.6 million in Transfers In. More specific information is detailed below. FORECAST 250 BUDGET ACTUAL/FORECAST* Table of Contents DEBT SVC GO BONDS BUDGET BY FUND | Debt Service Fund FY 2021/22 to FY 2027/28 (in millions) Debt Svc GO Bonds are Transfers In from the Preservation Fund to the Debt Service Fund to facilitate the payment of Preserve General Obligation (GO) debt service. Total Debt Svc GO Bonds Transfers In for FY 2025/26 is $26.4 million which is $7.3 million less than the FY 2024/25 adopted budget reflecting lower payments for the GO Debt Service - Preserve Bonds. Preserve Sales Tax supported GO bonds are scheduled to be paid off in 2027. DEBT SVC MPC BONDS FY 2021/22 to FY 2027/28 (in millions) Debt Svc Municipal Property Corporation (MPC) Bonds includes Transfers In from General Fund, Tourism Development Fund, Special Programs Fund, Stormwater Fund, and the Stadium Facility Fund to the Debt Service Fund to facilitate the payment of MPC Bonds debt service. Total Debt Service Transfers In for FY 2025/26 equal $16.4 million which is $7.3 million lower than FY 2024/25. WIFA DEBT FY 2021/22 to FY 2027/28 (in millions) WIFA debt represents loans or financing provided by the Water Infrastructure Finance Authority (WIFA) to fund drainage improvement capital projects at WestWorld. WIFA is a statelevel authority that offers low-interest loans and financial assistance to municipalities for water-related infrastructure, including parks and recreational facilities. The WIFA debt for WestWorld is backed by the dedicated revenue stream from Proposition 490, which is the 0.15% sales tax approved by voters in November 2024. FORECAST BUDGET ACTUAL/FORECAST* 251 Table of Contents BUDGET BY FUND | Debt Service Fund DEBT SERVICE FUND USES Debt Service is the payment of principal, interest and related service charges on obligations resulting from the issuance of bonds. The FY 2025/26 adopted budget includes $78.6 million in Debt Service. GO DEBT SERVICE - NON PRESERVE FY 2021/22 to FY 2027/28 (in millions) GO Debt Service - Non-Preserve is voter-authorized General Obligation debt issued for capital projects not associated with the McDowell Sonoran Preserve. General Obligation debt is repaid by Property Tax (secondary). Under state law, cities and towns are allowed to levy a Secondary Property Tax for the sole purpose of retiring the principal and interest on General Obligation indebtedness. For FY 2025/26, the General Obligation Bonds debt service is forecasted at $35.0 million, which is a $3.9 million increase when compared to the FY 2024/25 adopted budget. GO DEBT SERVICE - PRESERVE FY 2021/22 to FY 2027/28 (in millions) GO Debt Service - Preserve represents General Obligation debt issuances related to land acquisition in the McDowell Mountain Sonoran Preserve. Preserve debt is repaid by a dedicated 0.20 percent sales tax authorized by voters in 1995 which sunsetted in June 2025, and a 0.15 percent sales tax authorized by voters in 2004 which may sunset earlier than originally anticipated, based on council and voter approval. GO Debt Service - Preserve is budgeted at $26.4 million in FY 2025/26. FORECAST 252 BUDGET ACTUAL/FORECAST* Table of Contents MPC EXCISE DEBT BUDGET BY FUND | Debt Service Fund FY 2021/22 to FY 2027/28 (in millions) MPC Excise Debt represents Municipal Property Corporation bonds which are non-voter approved and issued by the City of Scottsdale Municipal Property Corporation, a nonprofit corporation created by the city in 1967 for the sole purpose of constructing, acquiring and equipping buildings, structures, or improvements on land owned by the city. The debt incurred by the corporation is a city obligation and the repayment of debt is financed by General Fund sales taxes, Tourism Development Fund bed tax receipts, etc. Per Financial Policy No. 8.04, nonvoter approved debt will be utilized only when a dedicated revenue source can be identified to pay or reimburse the city for paying debt services expenses. Debt Service payments for FY 2025/26 total $16.5 million, which is an decrease of $7.2 million compared to the FY 2024/25 adopted budget. DEBT SERVICE FUND ENDING BALANCE Ending fund balance includes reserves which protect the city’s financial condition and provide for unexpected economic challenges. The Debt Service Fund ending balance varies primarily due to the timing of debt issuances and related repayment schedules. Growth of fund balance occurs when sources exceed uses. The specific make-up of the city’s Debt Service Fund ending balance is noted in the following: DEBT STABILIZATION RESERVE FY 2021/22 to FY 2027/28 (in millions) Debt Stabilization Reserve of $5.2 million is projected for FY 2025/26. The Debt Stabilization Reserve balance varies primarily due to the timing of debt issuances and related repayment schedules associated with the MPC Excise Debt. While there is no legal requirement to hold this reserve at a certain level, the City Council has indicated that it should be maintained to protect the city from unexpected financial challenges. FORECAST BUDGET ACTUAL/FORECAST* 253 Table of Contents GO DEBT SERVICE RESERVE - NON PRESERVE BUDGET BY FUND | Debt Service Fund FY 2021/22 to FY 2027/28 (in millions) GO Debt Service Reserve – Non Preserve reserve is projected at $3.5 million for FY 2025/26. The GO Debt Service Reserve – Non-Preserve balance varies primarily due to the timing of debt issuances and related repayment schedules associated with GO Debt Service. Per Financial Policy No. 2.06, the secondary property tax supported debt reserve should be no more than 10 percent of the amount of annual principal and interest needed to service the outstanding debt. FORECAST 254 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Bonded Debt Debt Summary Outstanding Debt by Type The adopted FY 2025/26 budget includes outstanding debt by type and planned issuances as follows: G.O Bonds – NonPreserve G.O Bonds - Preserve Excise Tax Supported Water and Sewer Revenue Supported Aviation Revenue Supported Contracts Payable Total – City Debt New Issuance Adopted in FY25/26 $25,000,000 $50,000,000 $75,000,000 FY25/26 Principal and Interest Payments $34,981,866 $26,404,235 $17,165,787 $34,162,404 $1,719,244 $983,375 $115,416,910 Outstanding Debt at 7/1/26 $232,387,310 $125,787,690 $146,585,000 $318,980,000 $15,470,000 $4,726,339 $843,936,339 Outstanding City Debt at 7/1/26 - $843,936,339 Outstanding Community Facility District Debt at 7/1/26 - $2,518,000 Property Tax Supported GO Bonds $232,387,310 Preserve Tax Supported GO Bonds $125,787,690 Contracts Payable $4,726,339 Excise Tax Supported Bonds $146,585,000 Water and Sewer Revenue Supported Bonds $318,980,000 Community Facility District Tax Supported GO Bonds $2,518,000 Aviation Revenue Supported Bonds $15,470,000 255 Table of Contents Debt Summary BUDGET BY FUND | Bonded Debt Property Tax Supported General Obligation Bonds (Existing and Adopted) – The city issues General Obligation Bonds for improvements to streets, bridges, transportation systems, parks and trails, drainage systems and public safety and municipal facilities. General obligation bonds require voter approval. Secondary property taxes assessed are collected to repay general obligation bonds. Preserve Tax Supported General Bonds – The city issues General Obligation Bonds for Sonoran McDowell Preserve land and land improvements. General obligation bonds require voter approval. Preserve excise tax revenues are pledged to repay the preserve bonds. Excise Tax Supported Bonds – The city has debt secured by a pledge of all unrestricted excise taxes, transaction, franchise, privilege and business taxes, State-shared sales and income taxes, fees for licenses and permits and State revenue sharing, and fines and forfeitures, issued through the Municipal Property Corporation (MPC). These obligations were issued to fund the Museum of the West, TPC land and land improvements, WestWorld Land, Skysong Land, Flood Control, and other city improvements. Water and Sewer Revenue Supported Bonds – Water and sewer revenue supported bonds and other debt obligations are repaid with water and sewer revenues. Aviation Revenue Supported Bonds – Aviation revenue bonds are issued through the Municipal Property Corporation (MPC), pledging city excise tax revenues but are repaid with aviation revenues. Contracts Payable – The city has lease purchase agreements for the financing of equipment. Community Facility District (CFD) Tax Supported Debt – The city has two CFDs (DC Ranch and Scottsdale Waterfront Commercial). CFD bonds are repaid from a special purpose tax levied on the properties within the Districts. The city has no liability for CFD debt. 256 Table of Contents BUDGET BY FUND | Bonded Debt Debt Summary Debt Repayment Fiscal Year End 2025/26 Forecast Debt paydown reflects how quickly the city expects to repay outstanding debt. A more rapid repayment period reduces risks from future loss of revenues and is an indicator of repayment strength. Rapid repayment also allows debt capacity to be released and made available for future capital needs. The city’s debt paydown is strong with approximately 60 percent of total debt repaid in 10 years and 77 percent repaid in 15 years. $1,000 in millions $800 $600 $400 Contracts Payable Community Facility District Tax Supported GO Bonds Excise Tax Supported Bonds WIFA FY26 Aviation Revenue Supported Bonds Water and Sewer Revenue Supported Bonds Proposed Future Debt Water and Sewer Revenue Supported Bonds Proposed FY25 Water and Sewer Revenue Supported Bonds Preserve Tax Supported GO Bonds Property Tax Supported GO Bonds Proposed FY27 Property Tax Supported GO Bonds Proposed FY25 Property Tax Supported GO Bonds $200 $0 257 Table of Contents BUDGET BY FUND | Bonded Debt Debt Summary Property Tax Debt Limitation Fiscal Year End 2025/26 The Arizona Constitution, (Article 9, Section 8), provides that the general obligation bonded indebtedness for a city for general municipal purposes may not exceed six percent of the assessed valuation of the taxable property in that city. In addition to the six percent limitation for general municipal purpose bonds, cities may issue general obligation bonds up to an additional 20 percent of the assessed valuation for supplying such city with water, artificial light, or sewers, for the acquisition and development of land for open space preserves, parks, playgrounds and recreational facilities, public safety, law enforcement, fire and emergency services facilities and streets and transportation facilities. General Obligation Bonds Issued to Provide Water, Sewers, Artificial Light, Parks, Playgrounds and Recreational Facilities, Open Space Preserves, Public Safety, and Streets and Transportation Facilities 20% Constitutional Limit $2,768,261,618 Less General Obligation (385,781,815) Bonds 20% Bonds Outstanding Excess Premium (10,870,519) Available 20% Limitation Borrowing Capacity $2,371,599,284 General Obligation Bonds Issued for All Other Purposes 6% Constitutional Limit $830,478,485 Less General Obligation Bonds (20,766,745) 6% Bonds Outstanding Excess Premium (833,037) Available 6% Limitation $808,878,703 Borrowing Capacity Primary and Secondary Property Tax Rates History: Tax rates per $100 assessed valuation The primary property tax revenues are used by the General Fund for services such as Police, Fire, Community Services, and many other governmental purposes. The secondary property tax revenues are used to repay debt service on general obligation bonds. Fiscal Year 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 Forecast Primary Tax Rate $0.5273 $0.5039 $0.4970 $0.5150 $0.4958 $0.4891 Secondary Tax Rate $0.5043 $0.5042 $0.4101 $0.4664 $0.4358 $0.4233 Total Tax Rate $1.0316 $1.0081 $0.9071 $0.9814 $0.9316 $0.9124 Adopted Financial Policy Section 8.04 General Obligation Bonds: The city will not exceed $1.50 combined (primary and secondary) property tax rate per $100 net assessed limited property value unless otherwise directed by the council. 258 Table of Contents BUDGET BY FUND | Bonded Debt Debt Summary Pledged Revenue Coverage – Municipal Property Corporation* The Municipal Property Corporation (“MPC”) is a non-profit corporation created by the city as a financing conduit for the purpose of financing the construction or acquisition of city capital improvement projects. In order to obtain the funds necessary for the construction or acquisition of facilities, the MPC issues bonds and then leases the facilities to the city for lease-rental payments which equal the semiannual debt service payments on the MPC bonds. Pledged Revenue Coverage Ratio 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 - 2020/21 2021/22 2022/23 2023/24 Coverage 2024/25 2025/26 Forecast 2026/27 Forecast 2027/28 Forecast 2028/29 Forecast Debt Covenant *Includes debt service payments paid out of the General Fund, the Special Programs Fund, the Tourism Development Fund, the Stadium Facility Fund and the Water and Sewer Funds. 259 Table of Contents BUDGET BY FUND | Bonded Debt Debt Summary Scottsdale's Bond Rating Scottsdale General Obligation Bonds continue to maintain the highest possible rating from the three major national bond rating agencies, Moody's Investors Services, Standard & Poor's Rating Services, and Fitch Ratings, reaffirming their confidence in the city's financial management and its economic outlook. Scottsdale is one of a select number of municipalities achieving top ratings from all three. High bond ratings mean the city is able to sell General Obligation Bonds to finance voter-approved capital projects, including new parks, libraries, and pools at lower interest rates. Because the ratings are high, Scottsdale's General Obligation Bonds are highly desirable and therefore increase the value of existing bonds for investors. S u mm a r y o f Cu r r e n t Ra ti n gs : M oody' s I n ve s tor s S e r vi c e S ta n da r d & P oor ' s Ra ting s S e r vi c e s Fi tc h Ra ti n gs General Obligation (GO) Aaa AAA AAA Muncipal Property Corporation (MPC) Aa1 AAA AA+ Scottsdale Preserve Authority (SPA) Aa2 AA+ AA+ Water & Sewer Revenue (W&S) Aaa AAA AAA Debt Management Scottsdale's primary debt management objectives are to minimize the cost of borrowing to taxpayers while assuring that total indebtedness does not exceed available resources and conforms to Arizona legal requirements. The necessity to incur debt in order to finance the capital program requires the obligation to manage the debt program effectively. As a result, the level of outstanding debt and the city's capacity to incur and repay additional debt require careful examination. Proper debt management provides for the protection and eventual enhancement of bond ratings; and compliance with debt instrument provisions and required disclosures to investors, underwriters, and rating agencies. Financial Policy No.8 is used when evaluating the purpose, necessity and condition under which decisions are made to issue debt. Financial Policy No.8 is also meant to supplement the legal framework of public debt law provided by the Arizona Constitution, State statutes, federal tax laws, and the city's bond resolutions and covenants. 260 Table of Contents BUDGET BY FUND | Debt Service Expense + N S F Q 5 F ^R JS Y ) F Y J + T WJ H F X Y        & I T U Y J I        + T WJ H F X Y        + T WJ H F X Y        + T WJ H F X Y        + T WJ H F X Y                                                                                                                                                                                                                                                                             2 Z S N H N U F Q 5 WT U J WY ^ ( T WU T WF Y N T S  2 5 (  ' T S I X  *] H N X J 9 F ] 8Z U U T WY J I  8Z G Y T Y F Q G ^ + Z S I N S L 8T Z WH J ,JSJWFQ+ZSI*]HNXJ9F] ,+89  8UJHNFQ7J[JSZJ8YTWR\FYJW+JJ 8+  9TZWNXR)J[JQTURJSY+ZSI 9)+  8UJHNFQ5WTLWFR 2H)T\JQQ,TQK 85+  ,NFSYX(MFWWTX(TSYWNGZYNTS  8ZGYTYFQ2ZSNHNUFQ5WTUJWY^(TWUTWFYNTS 25('TSIX*]HNXJ9F]8ZUUTWYJI                                < .+ & 1 T F S  *] H N X J 9 F ] 8Z U U T WY J I  <.+&1TFS 2F^      ) J G Y 8J W[ N H J + Z S I , J S J WF Q 4 G Q N L F Y N T S  ,  4   ' T S I X  5 WT U J WY ^ 9 F ]  8J H T S I F W^  8Z U U T WY J I ,47JKZSINSL'TSIX 2&UW ,47JKZSINSL'TSIX 22F^ (,4;FWNTZX5ZWUTXJ'TSIX 2)JH ,4;FWNTZX5ZWUTXJ'TSIX 9F]FGQJ 2+JG ,4;FWNTZX5ZWUTXJ'TSIX 9F]*]JRUY 2+JG ,4;FWNTZX5ZWUTXJ'TSIX 9F]FGQJ 2/FS ,4;FWNTZX5ZWUTXJ'TSIX 9F]*]JRUY 2/FS *XYNRFYJI,4;FWNTZX5ZWUTXJ'TSIX 22F^ +ZYZWJ,4;FWNTZX5ZWUTXJ'TSIX 2+JG +NXHFQ&LJSY+JJXFSI&WGNYWFLJ+JJX 5 WJ X J W[ J , J S J WF Q 4 G Q N L F Y N T S ' T S I X  5 WJ X J W[ J 8F Q J X 9 F ] 8Z U U T WY J I ,4'TSIX5WJXJW[J 22F^ ,47JKZSINSL'TSIX5WJXJW[J 2&UW ,47JKZSINSL'TSIX5WJXJW[J 22F^ &,4'TSIX5WJXJW[J 22FW ,49F]FGQJ7JKZSINSL'TSIX5WJXJW[J 2)JH +NXHFQ&LJSY+JJXFSI&WGNYWFLJ+JJX 2 Z S N H N U F Q 5 WT U J WY ^ ( T WU T WF Y N T S  2 5 (  ' T S I X  *] H N X J 9 F ] 8Z U U T WY J I 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'47&IRNSNXYWFYNTSYTGJZXJIKTWNSHWJFXJI2FNSYJSFSHJFSI7JUFNWHTXYXIZJYT;JMNHQJ&HVZNXNYNTS IJKJWWFQXKZJQKQZHYZFYNTSXFSIXZUUQ^HMFNSHMFQQJSLJX G +>NSHQZIJIRFSZKFHYZWNSLHZYGFHPXFSIUFWYXXMTWYFLJX\MNHMHFZXJIIJQF^XNSIJQN[JWNJX YMJWJKTWJRFS^XHMJIZQJI[JMNHQJ UZWHMFXJX\JWJXMNKYJIYTYMJ(.5YTFHHTRRTIFYJQTSLQJFIYNRJXYTTWIJW[JMNHQJX9MNXKZSINSL\FXWJYZWSJIYTYMJTUJWFYNSLGZILJYKTW+>  H +>YMJ[JMNHQJFHVZNXNYNTSXMF[JGJJSRT[JIYTFSJ\+QJJY7JUQFHJRJSY+ZSI'JLNSSNSLNS+>YMJ[JMNHQJWJUQFHJRJSY FHYN[NY^NXGJNSLWJHTWIJINSYMJ+QJJY7JUQFHJRJSY+ZSI I .SHQZIJXSTSUJWNTINHUJWXTSSJQHTXYXXZHMFX1JF[J&HHWZFQX5FWJSYFQ1JF[J;FHFYNTS9WFIJFSI4SJ9NRJ2JWNY5F^RJSYX J &S+>YWFSXKJWNXUQFSSJIYTYWFSXKJWKZSIGFQFSHJKWTRYMJ+QJJY2FSFLJRJSY+ZSIYTYMJ+QJJY7JUQFHJRJSY+ZSINSTWIJWYTINXUQF^ [JMNHQJFHVZNXNYNTSFHYN[NYNJX 324 Table of Contents BUDGET BY FUND | Fleet Management Fund Five-Year Financial Forecast &ITUYJI   'JLNSSNSL+ZSI'FQFSHJ 4UJWFYNSL(TSYNSLJSH^ +QJJY2FSFLJRJSY+ZSI'FQFSHJ 9TYFQ'JLNSSNSL+ZSI'FQFSHJ +TWJHFXY   +TWJHFXY   +TWJHFXY   +TWJHFXY                                                                                                                                                                                                                            9TYFQ:XJX                                         8TZWHJX4[JW :SIJW:XJX                                                                                           7J[JSZJX 2FNSYJSFSHJ 4UJWFYNTSX +ZJQ 7JNRGZWXJRJSYXKWTR4ZYXNIJ8TZWHJX 2NXHJQQFSJTZX 7JSYFQ7FYJX 8ZGYTYFQ 9TYFQ8TZWHJX * ] U J S IN YZ W J X +QJJY2FSFLJRJSY&IRNSNXYWFYNTS +QJJY2FSFLJRJSY4UJWFYNTSX +QJJY2FSFLJRJSY5FWYX8ZUUQ^ +ZJQ 2TYTWUTTQ ;JMNHQJ&HVZNXNYNTSX F 5JWXTSSJQ5WTLWFRX G 4UJWFYNSL.RUFHYX 8F[NSLXKWTR;FHFSY5TXNYNTSX 8ZGYTYFQ 949&145*7&9.3,':),*9 9WFSXKJWX4ZY (.5 (.59JHMSTQTL^ 4YMJW H *SINSL+ZSI'FQFSHJ *QJHYWNH;JMNHQJ(TSYNSLJSH^ 4UJWFYNSL(TSYNSLJSH^ +QJJY2FSFLJRJSY+ZSI'FQFSHJ 9TYFQ*SINSL+ZSI'FQFSHJ 8ZGYTYFQ F 'JLNSSNSLNS+>YMJ[JMNHQJWJUQFHJRJSYFHYN[NY^NXGJNSLWJHTWIJINSYMJSJ\+QJJY7JUQFHJRJSY+ZSI .SHQZIJXSTSUJWNTINHUJWXTSSJQHTXYXXZHMFX1JF[J&HHWZFQX5FWJSYFQ1JF[J;FHFYNTS9WFIJFSI4SJ9NRJ2JWNY5F^RJSYX H &S+>YWFSXKJWNXUQFSSJIYTYWFSXKJWKZSIGFQFSHJKWTRYMJ+QJJY2FSFLJRJSY+ZSIYTYMJ+QJJY7JUQFHJRJSY+ZSINSTWIJWYTINXUQF^[JMNHQJFHVZNXNYNTS FHYN[NYNJX G 325 Table of Contents BUDGET BY FUND | Fleet Management Fund FLEET MANAGEMENT FUND SOURCES Fleet Management Sources for FY 2025/26 equal $17.1 million, which is a decrease of $14.0 million from the FY 2024/25 budgeted sources. The Fleet Management Fund includes revenues from rates charged to city divisions as internal operating costs for Fuel and for Maintenance & Operations. Reimbursements from Outside Sources and Miscellaneous are also revenues received in the fund. In prior fiscal years, Rental Rates were also charged to divisions and routed to the fund for the purpose of vehicle acquisition. Beginning this fiscal year, Rental Rates are recorded in the new Fleet Replacement Fund. MAINTENANCE & OPERATIONS FY 2021/22 to FY 2027/28 (in millions) Maintenance & Operations sources originate from charges to other city divisions based on the usage of city vehicles and equipment. The Maintenance & Operations revenue for FY 2025/26 totals $10.9 million, which is an increase of $2.0 million from the FY 2024/25 budgeted revenue. FUEL FY 2021/22 to FY 2027/28 (in millions) Fuel represents the charges to other city divisions based on the fuel consumption of city vehicles and equipment. Rates are determined based on historical data as well as forecasted future consumption. Included in this methodology are local and national fuel cost trends. The FY 2025/26 budgeted revenue is $5.6 million, which is a decrease of $0.4 million when compared to the FY 2024/25 budgeted revenue. FORECAST 326 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Fleet Management Fund REIMBURSEMENTS FROM OUTSIDE SOURCES FY 2021/22 to FY 2027/28 (in millions) Reimbursements from Outside Sources revenue is generated from any insurance recoveries received and reimbursements for fuel taxes and vehicle parts. Reimbursements from Outside Sources is budgeted at $0.6 million for FY 2025/26, which is flat compared with the FY 2024/25 budgeted revenue. MISCELLANEOUS FY 2021/22 to FY 2027/28 Miscellaneous revenue is generated from the liquidation of surplus property and fuel tax recovery from the state. The FY 2025/26 budgeted revenue is $24,721, which is a $457,407 decrease from the FY 2024/25 budgeted revenue. The decrease reflects the reclassification of proceeds from surplus equipment sales to the newly established Fleet Replacement Fund. RENTAL RATES FY 2021/22 to FY 2027/28 (in millions) Rental Rates represent the replacement fees charged to departments that are sufficient for the acquisition and replacement of city vehicles and equipment. The amount collected is to ensure sufficient funding exists for vehicle/equipment acquisition and replacement while also considering future needs. The goal is to minimize large projected increases/decreases each year for the replacement fees charged to the divisions. Rental Rates made up 49 percent of the FY 2024/25 revenue sources at $15.2 million. From FY 2025/26 forward, rental rates will be routed to the newly created Fleet Replacement Fund. FORECAST BUDGET ACTUAL/FORECAST* 327 Table of Contents BUDGET BY FUND | Fleet Management Fund FLEET MANAGEMENT FUND USES Fleet Management Uses for FY 2025/26 equal $18.3 million which is a decrease of $14.3 million from the FY 2024/25 adopted budget. The direct operating uses for the Fleet Management Fund are summarized below by Fleet Management Administration, Fleet Management Operations, Fleet Management Parts Supply, Fuel, and Motorpool. FLEET MANAGEMENT ADMINISTRATION FY 2021/22 to FY 2027/28 (in millions) Fleet Management Administration includes all costs related to supporting the management and administrative personnel that are dedicated to directing and overseeing the fleet operation of the city. The FY 2025/26 adopted budget is $0.9 million, which is flat when compared to the FY 2024/25 adopted budget. FLEET MANAGEMENT OPERATIONS FY 2021/22 to FY 2027/28 (in millions) Fleet Management Operations includes costs related to supporting technical personnel that perform the maintenance and repair functions of the city’s fleet operation, the funding for replacement parts, and the use of outside vendors when necessary. The FY 2025/26 adopted budget of $11.6 million is a $0.8 million increase over the FY 2024/25 adopted budget. The increase is due, in large part, to inflation in the price of parts used to maintain the fleet of more than 1,300 pieces of equipment. FORECAST 328 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Fleet Management Fund FLEET MANAGEMENT PARTS SUPPLY FY 2021/22 to FY 2027/28 (in millions) Fleet Management Parts Supply includes all costs related to supporting the specialized personnel that are dedicated to maintaining the parts segment of the city’s fleet operation, as well as the costs of all required supplies and tools. The FY 2025/26 adopted budget is $0.8 million, which is an increase of $0.1 million when compared to the FY 2024/25 adopted budget. FUEL FY 2021/22 to FY 2027/28 (in millions) Fuel includes all costs related to the purchase of fuel, as well as costs for equipment, maintenance, and services necessary to maintain the provision of fuel in the city’s fleet operation. The FY 2025/26 adopted budget is $5.0 million, which is flat compared to the FY 2024/25 adopted budget. MOTORPOOL FY 2021/22 to FY 2027/28 Motorpool includes all costs related to the care of the city’s motorpool vehicles including fuel and maintenance. The FY 2025/26 adopted budget of $75,864 is a $1,744 decrease compared to the FY 2024/25 adopted budget. FORECAST BUDGET ACTUAL/FORECAST* 329 Table of Contents BUDGET BY FUND | Fleet Management Fund VEHICLE ACQUISITIONS FY 2021/22 to FY 2027/28 (in millions) Vehicle Acquisitions include all costs related to the purchase or replacement of vehicles within the city's fleet. Beginning in FY 2025/26, vehicle acquisitions will be budgeted in the new Fleet Replacement Fund. Vehicle acquisition expenses in FY 2024/25 were much lower than budgeted due to long lead times and anticipated delivery delays. PERSONNEL PROGRAMS FY 2021/22 to FY 2027/28 Personnel Programs includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. SAVINGS FROM VACANT POSITIONS FY 2021/22 to FY 2027/28 (in millions) The amount of savings achieved from vacant positions for FY 2025/26 is estimated at ($0.3) million. FORECAST 330 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Fleet Management Fund TRANSFERS OUT Transfers Out are the authorized movement of cash to other funds and/or capital projects. Fleet Management Transfers Out for FY 2025/26 equal $12.8 million which is an increase of $12.2 million from the FY 2024/25 adopted budget. The bulk of this is attributable to a transfer of $12.5 million from the Fleet Management Fund to the new Fleet Replacement Fund. CIP FY 2021/22 to FY 2027/28 (in millions) The FY 2025/26 CIP adopted budget of $0.2 million will be primarily used to fund the Fleet Electric Vehicle (EV) Infrastructure Implementation. Project elements include, but are not limited to, electric vehicle charging stations, equipment required for maintenance, and required infrastructure. CIP TECHNOLOGY FY 2021/22 to FY 2027/28 The CIP Technology budget of $51,183 is planned to help cover Fleet Management's portion of citywide technology capital projects during FY 2025/26. FORECAST BUDGET ACTUAL/FORECAST* 331 Table of Contents BUDGET BY FUND | Fleet Management Fund OTHER FY 2021/22 to FY 2027/28 (in millions) In FY 2025/26, $12.5 million is set to be transferred from the Fleet Management Fund to the new Fleet Replacement fund. FLEET MANAGEMENT FUND ENDING BALANCE Fund balance protects the city’s financial condition and provides for unexpected economic challenges. Growth of fund balance occurs when sources exceed uses. The city’s budget planning and adopted financial policies call for the establishment of reserves as part of the resource allocation/limit setting process. This process allows the city to set aside savings before allocated or spent as budgeted expenditures. OPERATING CONTINGENCY FY 2021/22 to FY 2027/28 (in millions) The Operating Contingency was reinstated to be used for increased Maintenance and Repair costs due to Vehicle Acquisition deferrals, fuel fluctuations, and supply chain shifts. The FY 2025/26 adopted budget is $1.0 million. FORECAST 332 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Fleet Management Fund FLEET MANAGEMENT FUND BALANCE FY 2021/22 to FY 2027/28 (in millions) Fleet Management Fund Balance accounts for any funds remaining after the designation of all other reserves/uses. The FY 2025/26 ending Fleet Management Fund Balance is $6.2 million which is $0.8 million less than the FY 2024/25 adopted budget. FORECAST BUDGET ACTUAL/FORECAST* 333 Table of Contents FY 2025/26 Adopted Budget 334 Table of Contents BUDGET BY FUND | Fleet Replacement Fund FUND PURPOSE Beginning in FY 2025/26, the Fleet Replacement Fund was created to record all fleet acquisition and replacement activity. Acquisition and replacement costs for vehicles and major equipment are charged to the city departments as internal capital costs based on the quantity and type of assets being replaced. These department charges are treated as revenue to the Fleet Replacement Fund. Fleet Replacement Fund Sources (% to Total) $28.6 Million Fleet Replacement Fund Uses (% to Total) $27.1 Million Rounding differences may occur. 335 Table of Contents BUDGET BY FUND | Fleet Replacement Fund Summary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able of Contents BUDGET BY FUND | Fleet Replacement Fund Five-Year Financial Forecast &ITUYJI       'JLNSSNSL+ZSI'FQFSHJ 4UJWFYNSL(TSYNSLJSH^ +QJJY7JUQFHJRJSY+ZSI'FQFSHJ 9TYFQ'JLNSSNSL+ZSI'FQFSHJ +TWJHFXY         +TWJHFXY        +TWJHFXY        +TWJHFXY                                         8ZGYTYFQ                8ZGYTYFQ                                                       949&145*7&9.3,':),*9      9TYFQ:XJX                                   8TZWHJX4[JW :SIJW:XJX                     *SINSL+ZSI'FQFSHJ 4UJWFYNSL(TSYNSLJSH^ +QJJY7JUQFHJRJSY+ZSI'FQFSHJ 9TYFQ*SINSL+ZSI'FQFSHJ                                          7J[JSZJX 7JSYFQ7FYJX 2NXHJQQFSJTZX 9WFSXKJWX.S 4UJWFYNSL F 9TYFQ8TZWHJX *]UJSINYZWJX ;JMNHQJ&HVZNXNYNTS G 8ZGYTYFQ F 'JLNSSNSLNS+>YMJ+QJJY7JUQFHJRJSY+ZSI\FXHWJFYJIYTWJHTWIFQQKQJJYFHVZNXNYNTSFSIWJUQFHJRJSYFHYN[NY^& RNQQNTSHFXMYWFSXKJWNX GZILJYJIYTRT[JKZSIGFQFSHJKWTRYMJ+QJJY2FSFLJRJSY+ZSIYTYMJSJ\+QJJY7JUQFHJRJSY+ZSI&SSZFQ RNQQNTSYWFSXKJWKWTRYMJ7NXP2FSFLJRJSY+ZSI YTYMJ+QJJY7JUQFHJRJSY+ZSIYTHT[JWWJUQFHJRJSYTKYTYFQJI[JMNHQJX G +>NSHQZIJXHFWW^T[JWTK RNQQNTSWJXZQYJIKWTR[JMNHQJFHVZNXNYNTSRFWPJYIJQF^X 337 Table of Contents BUDGET BY FUND | Fleet Replacement Fund FLEET REPLACEMENT FUND SOURCES Beginning in FY 2025/26, the Fleet Replacement Fund was created to record all fleet acquisition and replacement activity. Fleet Replacement Fund Sources for FY 2025/26 equal $28.6 million. The Fleet Replacement Fund includes revenues from rates charged to city departments as internal operating costs for Vehicle Acquisitions, as well as funds from the sale of surplus equipment. A $12.5 million cash transfer is budgeted to move fund balance from the Fleet Management Fund to the new Fleet Replacement Fund. RENTAL RATES FY 2021/22 to FY 2027/28 (in millions) Rental Rates represent the replacement fees charged to departments sufficient for the acquisition and replacement of city vehicles and equipment. The amount collected is to ensure sufficient funding exists for vehicle/equipment acquisition and to minimize large projected increases/decreases each year for the replacement fees charged to the departments. The FY 2025/26 adopted budget is $15.5 million. MISCELLANEOUS FY 2021/22 to FY 2027/28 (in millions) Miscellaneous revenue is generated from the liquidation of surplus property. The FY 2025/26 adopted budget includes Miscellaneous revenue of $0.6 million. TRANSFERS IN Transfers In are the authorized movement of cash or other resources from other funds. The FY 2025/26 adopted budget includes $12.6 million for Transfers In. FORECAST 338 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Fleet Replacement Fund OPERATING FY 2021/22 to FY 2027/28 (in millions) A $12.5 million cash transfer is budgeted to move fund balance from the Fleet Management Fund to the new Fleet Replacement Fund. Additionally, an annual $0.1 million transfer from the Risk Management Fund to the Fleet Replacement Fund is budgeted to cover replacement of totaled vehicles. FLEET REPLACEMENT FUND USES Fleet Replacement Fund Uses for FY 2025/26 equal $27.1 million. The Fleet Replacement Fund is specifically for the purpose of Vehicle Acquisitions. VEHICLE ACQUISITION FY 2021/22 to FY 2027/28 (in millions) The FY 2025/26 adopted budget includes $27.1 million in Vehicle Acquisition funding. A portion of this funding is carried over from the prior year’s unspent Vehicle Acquisition appropriation because delivery delays and reduced government-order vehicle allocations often push replacement procurements past their originally budgeted year. Additionally, increased funding complies with Fleet Audit recommendations—ensuring vehicles and equipment are replaced on schedule and minimizing costly maintenance on aging assets. FLEET REPLACEMENT FUND ENDING BALANCE Fund balance protects the city's financial condition and provides for unexpected economic challenges. Growth of fund balance occurs when sources exceed uses. The city's budget planning and adopted financial policies call for the establishment of reserves as part of the resource allocation/limit setting process. This process allows the city to set aside savings before being allocated or spent as budgeted expenditures. FORECAST BUDGET ACTUAL/FORECAST* 339 Table of Contents BUDGET BY FUND | Fleet Replacement Fund OPERATING CONTINGENCY FY 2021/22 to FY 2027/28 (in millions) Operating Contingency is used to cover potential cost increases in purchasing vehicles and equipment due to economic changes. The FY 2025/26 adopted budget is $1.0 million. Contingency funds are utilized only after all budget options have been considered and require City Council approval. FLEET REPLACEMENT FUND BALANCE FY 2021/22 to FY 2027/28 (in millions) The Fleet Replacement Fund Balance accounts for any funds remaining after the designation of all other reserves/uses. The FY 2025/26 ending Fleet Replacement Fund Balance is $0.6 million. FORECAST 340 BUDGET ACTUAL/FORECAST* Table of Contents BUDGET BY FUND | Risk Management Fund FUND PURPOSE The Risk Management Fund is used to account for the city’s self insurance, safety, and risk management functions. Revenue is derived from internal charges to city departments and is captured as internal rates. Payments for unemployment, workers’ compensation, and property and liability claims are disbursed from this fund. Risk Management Fund Sources (% to Total) $21.5 Million Risk Management Fund Uses (% to Total) $19.7 Million Rounding differences may occur. 341 Table of Contents BUDGET BY FUND | Risk Management Fund Summary Actual 20 23 / 24 Adopted 20 24 / 25 Forecast 20 24 / 25 Adopted 20 25 / 26 2,500,000 24,555,196 2 7 ,0 5 5 , 1 9 6 2,500,000 26,488,589 2 8 ,9 8 8 , 5 8 9 2,500,000 27,875,137 3 0 ,3 7 5 , 1 3 7 2,500,000 30,324,065 32 , 8 24 , 0 65 16,506,444 2,201,944 587,617 227,773 47,398 19,571,174 18,803,303 1,200,000 525,000 290,000 54,681 20,872,984 18,803,303 1,200,000 525,000 480,000 54,681 21,062,984 20,050,923 678,687 525,000 240,000 54,485 21,549,095 19 , 5 71 , 1 74 20 , 8 72 , 9 84 21 , 0 62 , 9 84 2 1 ,5 4 9 , 0 9 5 4,898,369 2,260,873 1,512,023 2,004,488 206,276 8,300 5,331,356 16,221,684 5,357,665 4,239,988 1,520,028 2,477,246 143,407 52,500 5,730,458 7,012 19,528,304 5,357,665 3,239,988 1,520,028 2,461,306 143,407 52,500 5,730,458 2,538 18,507,890 6,081,380 3,770,611 1,255,854 2,584,173 203,181 52,500 5,598,704 2,888 19,549,291 16,221,684 19,528,304 18,507,890 19,549,291 29,549 29,549 20,541 20,541 106,166 106,166 16,171 100,000 116,171 Total Uses 1 6 ,2 5 1 , 2 3 3 1 9 ,5 4 8 , 8 4 5 18 , 6 14 , 0 56 19 , 6 65 , 4 62 Sources Over/(Under) Uses 3 ,3 1 9 , 9 4 1 1 ,3 2 4 , 1 3 9 2 ,4 4 8 , 9 2 8 1 , 8 83 , 6 33 Ending Fund Balance Operating Contingency Operating Reserve Total Ending Fund Balance 2,500,000 27,875,137 3 0 ,3 7 5 , 1 3 7 2,500,000 27,812,728 30 , 3 12 , 7 28 2,500,000 30,324,065 32 , 8 24 , 0 65 2,500,000 32,207,698 3 4 ,7 0 7 , 6 9 8 Beginning Fund Balance Operating Contingency Operating Reserve Total Beginning Fund Balance Re v e nue s Self Insurance (Property and Workers Comp) (a) Property Tax Reimbursements from Outside Sources Miscellaneous Unemployment Claims Subtotal Total Sources Expenditures Insurance and Bond Premiums Liability Physical Damage Safety and Risk Management Safety Grants Program Unemployment Workers Compensation Personnel Programs (b) Subtotal TOTAL OPERATING BUDGET Transfers Out CIP Operating(c) Subtotal (a) Anticipated decreases in Property Tax are due to expected reductions in the volume and scale of involuntary tort claims. Includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. (c) Transfer to the Fleet Replacement Fund to cover replacement of totaled police vehicles. (b) 342 Table of Contents BUDGET BY FUND | Risk Management Fund Five-Year Financial Forecast Adopted 20 25 / 26 Forecast 20 26 / 27 Forecast 20 27 / 28 Forecast 20 28 / 29 Forecast 20 29 / 30 2,500,000 30,324,065 3 2 ,8 2 4 , 0 6 5 2,500,000 32,207,698 3 4 ,7 0 7 , 6 9 8 2,500,000 33,710,098 36 , 2 10 , 0 98 2,500,000 35,026,998 37 , 5 26 , 9 98 2,500,000 36,244,898 38 , 7 44 , 8 98 20,050,923 678,687 525,000 240,000 54,485 21,549,095 20,839,100 550,000 500,000 240,000 56,500 22,185,600 21,857,800 550,000 500,000 240,000 58,600 23,206,400 22,929,100 550,000 500,000 240,000 60,800 24,279,900 24,727,200 550,000 500,000 240,000 63,000 26,080,200 2 1 , 5 4 9 ,0 9 5 2 2 ,1 8 5 ,6 0 0 2 3 ,2 0 6 , 4 0 0 2 4 ,2 7 9 , 9 0 0 26 , 0 80 , 2 00 6,081,380 3,770,611 1,255,854 2,584,173 203,181 52,500 5,598,704 2,888 19,549,291 6,841,600 3,854,400 1,283,800 2,648,100 207,600 55,100 5,667,600 3,000 20,561,200 7,696,700 3,940,100 1,312,400 2,800,300 212,300 57,900 5,743,100 3,100 21,765,900 8,658,800 4,028,000 1,341,900 2,816,400 216,800 60,800 5,808,100 3,100 22,933,900 9,741,200 4,118,400 1,372,000 2,911,600 221,600 63,800 5,880,000 3,200 24,311,800 19,549,291 20,561,200 21,765,900 22,933,900 24,311,800 16,171 100,000 116,171 22,000 100,000 122,000 23,600 100,000 123,600 28,100 100,000 128,100 11,100 100,000 111,100 Total Uses 1 9 ,6 6 5 , 4 6 2 20 , 6 83 , 2 00 21 , 8 89 , 5 00 2 3 ,0 6 2 , 0 0 0 24 , 4 22 , 9 00 Sources Over/(Under) Uses 1 ,8 8 3 , 6 3 3 1 ,5 0 2 , 4 0 0 1 , 3 16 , 9 00 1 ,2 1 7 , 9 0 0 1 ,6 5 7 ,3 0 0 Ending Fund Balance Operating Contingency Operating Reserve Total Ending Fund Balance 2,500,000 32,207,698 34 , 7 07 , 6 98 2,500,000 33,710,098 36 , 2 10 , 0 98 2,500,000 35,026,998 3 7 ,5 2 6 , 9 9 8 2,500,000 36,244,898 38 , 7 44 , 8 98 2,500,000 37,902,198 40 , 4 02 , 1 98 Beginning Fund Balance Operating Contingency Operating Reserve Total Beginning Fund Balance Re v e nue s Self Insurance (Property and Workers Comp) Property Tax Reimbursements from Outside Sources Miscellaneous Unemployment Claims Subtotal Total Sources Expenditures Insurance and Bond Premiums Liability Physical Damage Safety and Risk Management Safety Grants Program Unemployment Workers Compensation Personnel Programs (a) Subtotal TOTAL OPERATING BUDGET Transfers Out CIP Operating (a) (b) (b) Subtotal Includes non-periodic personnel costs such as Leave Accruals, Parental Leave, Vacation Trade, and One-Time Merit Payments. Transfer to the Fleet Replacement Fund to cover replacement of totaled police vehicles. 343 Table of Contents BUDGET BY FUND | Risk Management Fund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’W6MWO 1EREKIQIRX*YRHJSVXLIPMEFMPMX]XSVXWIXXPIQIRXWERH NYHKQIRXWETTVSZIHF]'MX]'SYRGMPERHTEMHHYVMRKXLIQSWX VIGIRXP]GSQTPIXIHGEPIRHEV]IEV8LIMRGPYWMSRSJXLIXSVX GPEMQVIMQFYVWIQIRXWMRXLIGMX]’WTVMQEV]XE\PIZ]MWEPPS[IH TIVE1EVGL%VM^SRE%XXSVRI]+IRIVEPSTMRMSR8LI XSVXI\TIRWIWEVITEMHJVSQXLI6MWO1EREKIQIRX*YRH XLIVIJSVIXLIVIMQFYVWIQIRXFIGSQIWVIZIRYIXSXLMWJYRH SRGITVSTIVX]XE\IWEVIGSPPIGXIH8LI*=FYHKIXIH VIZIRYIMWQMPPMSR[LMGLMWEHIGVIEWISJQMPPMSR [LIRGSQTEVIHXSXLI*=EHSTXIHFYHKIXHYIXSXLI I\TIGXIHVIHYGXMSRWMRXLIZSPYQIERHWGEPISJMRZSPYRXEV] XSVXGPEMQW6IMQFYVWIQIRXW[IVILMKLIVMR*=ERH *=HYIXSERMRGVIEWIMRMRZSPYRXEV]XSVXGPEMQ TE]QIRXW *36)'%78 344 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Risk Management Fund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able of Contents BUDGET BY FUND | Risk Management Fund 6-7/1%2%+)1)28*92(97)7 8LIHMVIGXSTIVEXMRKI\TIRHMXYVIWSJXLI6MWO1EREKIQIRX*YRHEVIHMZMHIHMRXSXLIJSPPS[MRKQENSVI\TIRHMXYVIGEXIKSVMIW -RWYVERGIERH&SRH4VIQMYQW0MEFMPMX]4L]WMGEP(EQEKI7EJIX]ERH6MWO1EREKIQIRX7EJIX]+VERXW4VSKVEQ9RIQTPS]QIRX ;SVOIVW 'SQTIRWEXMSRERH4IVWSRRIP4VSKVEQW%PWSMRGPYHIHEVIGEWL8VERWJIVW3YXXSXLI'ETMXEP-QTVSZIQIRX4PER '-4 ERH XSSXLIVJYRHW8LI*=EHSTXIHFYHKIXMWQMPPMSREMRGVIEWIJVSQXLI*=EHSTXIHFYHKIX -2796%2')%2(&32(46)1-917 *=XS*= MRQMPPMSRW -RWYVERGIERH&SRH4VIQMYQWMRGPYHIWZEVMSYWGMX][MHI MRWYVERGITSPMGMIWJSVYQFVIPPEX]TIGSZIVEKISJJIVMRK TVSXIGXMSREKEMRWXPEVKISVSRKSMRKGPEMQW8LI*= EHSTXIHFYHKIXMWQMPPMSR[LMGLMWERMRGVIEWISJ QMPPMSR[LIRGSQTEVIHXSXLI*=EHSTXIHFYHKIXHYI XSMRGVIEWIHTVIQMYQW 0-%&-0-8= *=XS*= MRQMPPMSRW 0MEFMPMX]TVMQEVMP]MRGPYHIWGPEMQTE]QIRXWERHPIKEPGSWXWJSV EPPEGXMZMXMIWRSXVIPEXIHXSTL]WMGEPHEQEKISV[SVOIVW  GSQTIRWEXMSRGPEMQW8LI*=EHSTXIHFYHKIXMW QMPPMSR[LMGLMWEHIGVIEWISJQMPPMSR[LIRGSQTEVIHXS XLI*=EHSTXIHFYHKIXHYIXSEHIGVIEWIMRKIRIVEP PMEFMPMX]GPEMQW *36)'%78 346 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Risk Management Fund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able of Contents BUDGET BY FUND | Risk Management Fund 92)1403=1)28 *=XS*= 9RIQTPS]QIRXMWGSQTSWIHSJGPEMQWTEMHXSUYEPMJ]MRK XIVQMREXIHGMX]IQTPS]IIW8LI*=EHSTXIHFYHKIXMW [LMGLVIQEMRWJPEX[LIRGSQTEVIHXSXLI*= EHSTXIHFYHKIX ;36/)67 '314)27%8-32 *=XS*= MRQMPPMSRW ;SVOIVW 'SQTIRWEXMSRMWGSQTSWIHSJGPEMQWTEMHXSGYVVIRX GMX]IQTPS]IIWMRXLIIZIRXSJERMRNYV]MPPRIWWSVHMWIEWI SGGYVVMRKMRXLIGSYVWISJGMX]IQTPS]QIRX8LI*= EHSTXIHFYHKIXMWQMPPMSR[LMGLMWEHIGVIEWISJ QMPPMSR[LIRGSQTEVIHXSXLI*=EHSTXIHFYHKIX 4)67322)0463+6%17 *=XS*= Personnel Programs includes non-periodic costs such as leave accruals, parental leave, vacation trade, and one-time merit payments. The FY 2025/26 budget is $2,888, which is a decrease of $4,124 when compared to the FY 2024/25 adopted budget. The FY 2024/25 actuals were higher than budget due to retirement payouts. The FY 2023/24 budget and actuals were higher than average due to retirement payouts and a budgeted class and compensation study. *36)'%78 348 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Risk Management Fund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able of Contents BUDGET BY FUND | Risk Management Fund 34)6%8-2+'328-2+)2'= *=XS*= MRQMPPMSRW 8LI*=3TIVEXMRK'SRXMRKIRG]MRGPYHIWQMPPMSR SJFYHKIXEYXLSVM^EXMSRMRXLIIZIRXXLEXYRJSVIWIIRI\TIRWIW SGGYVHYVMRKXLIJMWGEP]IEV'SRXMRKIRG]JYRHWEVIYXMPM^IH SRP]EJXIVEPPSXLIVFYHKIXSTXMSRWLEZIFIIRI\EQMRIHERH VIUYMVIW'MX]'SYRGMPETTVSZEP 34)6%8-2+6)7)6:) *=XS*= MRQMPPMSRW 8LI*=3TIVEXMRK6IWIVZIMWQMPPMSR[LMGLMW ERMRGVIEWISJQMPPMSR[LIRGSQTEVIHXSXLI*= EHSTXIHFYHKIX *36)'%78 350 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | PC Replacement Fund FUND PURPOSE The PC Replacement Fund is used to account for the expenditures associated with purchasing the city’s computers, monitors, and printers. The replacement of computers, monitors and printers (hardware) is charged to the city departments as an internal operating cost based on the quantity and type of hardware used. The internal charges paid by the departments become revenue to the PC Replacement Fund. PC Replacement Fund Sources (% to Total) $1.0 Million PC Replacement Fund Uses (% to Total) $1.3 Million Rounding differences may occur. 351 Table of Contents BUDGET BY FUND | PC Replacement Fund Summary Beginning Fund Balance Operating Contingency PC Replacement Fund Balance Total Beginning Fund Balance Actual 20 23 / 24 Adopted 20 24 / 25 Forecast 20 24 / 25 Adopted 20 25 / 26 100,000 1,586,455 1 , 6 86 , 4 55 100,000 1,668,285 1 ,7 6 8 , 2 8 5 100,000 1,745,028 1 ,8 4 5 , 0 2 8 100,000 1,357,935 1 ,4 5 7 , 9 3 5 Re v e nue s 850,000 950,007 950,007 1,010,659 850,000 950,007 950,007 1,010,659 8 5 0 ,0 0 0 9 5 0 ,0 0 7 9 5 0 ,0 0 7 1 ,0 1 0 ,6 5 9 691,427 691,427 1,637,100 1,637,100 1,337,100 1,337,100 1,317,661 1,317,661 691,427 1,637,100 1,337,100 1,317,661 Total Uses 6 9 1 ,4 2 7 1 , 6 3 7 ,1 0 0 1 , 3 3 7 ,1 0 0 1 , 3 1 7 ,6 6 1 Sources Over/(Under) Uses 1 58 , 5 73 ( 6 87 , 0 93) (3 8 7 , 0 9 3 ) (3 0 7 , 0 0 2 ) Ending Fund Balance Operating Contingency PC Replacement Fund Balance Total Ending Fund Balance 100,000 1,745,028 1 , 8 4 5 ,0 2 8 100,000 981,192 1 , 0 8 1 ,1 9 2 100,000 1,357,935 1 , 4 5 7 ,9 3 5 100,000 1,050,933 1 , 1 5 0 ,9 3 3 PC Replacement Fees(a) Subtotal Total Sources Expenditures Computer Hardware Acquisition Subtotal TOTAL OPERATING BUDGET (a) Beginning in FY 2024/25, the PC Replacement Fees are intentionally under-collecting to utilize available fund balance. 352 Table of Contents BUDGET BY FUND | PC Replacement Fund Five-Year Financial Forecast Adopted 20 25 / 26 Forecast 20 26 / 27 Forecast 20 27 / 28 Forecast 20 28 / 29 Forecast 20 29 / 30 100,000 1,357,935 1 ,4 5 7 ,9 3 5 100,000 1,050,933 1 ,1 5 0 , 9 3 3 100,000 839,433 9 3 9 ,4 3 3 100,000 593,933 6 9 3 ,9 3 3 100,000 308,133 4 0 8 ,1 3 3 1,010,659 1,040,500 1,094,200 1,147,700 1,205,500 1,010,659 1,040,500 1,094,200 1,147,700 1,205,500 1 ,0 1 0 , 6 5 9 1 ,0 4 0 , 5 0 0 1 ,0 9 4 , 2 0 0 1 ,1 4 7 , 7 0 0 1 ,2 0 5 ,5 0 0 1,317,661 1,317,661 1,252,000 1,252,000 1,339,700 1,339,700 1,433,500 1,433,500 1,513,600 1,513,600 1,317,661 1,252,000 1,339,700 1,433,500 1,513,600 Total Uses 1 ,3 1 7 , 6 6 1 1 ,2 5 2 , 0 0 0 1 ,3 3 9 , 7 0 0 1 ,4 3 3 ,5 0 0 1 ,5 1 3 ,6 0 0 Sources Over/(Under) Uses ( 3 0 7 ,0 0 2 ) ( 2 1 1 ,5 0 0 ) ( 2 4 5 ,5 0 0 ) ( 2 8 5 ,8 0 0 ) ( 3 0 8 ,1 0 0 ) Ending Fund Balance Operating Contingency PC Replacement Fund Balance Total Ending Fund Balance 100,000 1,050,933 1 ,1 5 0 , 9 3 3 100,000 839,433 9 3 9 ,4 3 3 100,000 593,933 6 9 3 ,9 3 3 100,000 308,133 4 0 8 ,1 3 3 100,000 33 1 00 , 0 33 Beginning Fund Balance Operating Contingency PC Replacement Fund Balance Total Beginning Fund Balance Re v e nue s PC Replacement Fees(a) Subtotal Total Sources Expenditures Computer Hardware Acquisition Subtotal TOTAL OPERATING BUDGET (a) Beginning in FY 2024/25, the PC Replacement Fees are intentionally under-collecting to utilize available fund balance. 353 Table of Contents BUDGET BY FUND | PC Replacement Fund 4'6)40%')1)28*92(7396')7 8LI4'6ITPEGIQIRX*YRHMRGPYHIWVIZIRYIJVSQVEXIWGLEVKIHXSXLIGMX]HITEVXQIRXWEWMRXIVREPSTIVEXMRKGSWXWXSIEGLTVSKVEQ FEWIHSRXLIUYERXMX]ERHX]TISJLEVH[EVIYWIH8LISRP]WSYVGISJVIZIRYIXSXLMWJYRHMWXLI4'6ITPEGIQIRX*IIWHIXEMPIH FIPS[ 4'6)40%')1)28*))7 *=XS*= MRQMPPMSRW 4'6ITPEGIQIRX*IIWVITVIWIRXXLIVEXIWGLEVKIHXSSXLIVGMX] JYRHWERHHITEVXQIRXWJSVXLIEGUYMWMXMSRERHVITPEGIQIRXSJ GMX]GSQTYXIVLEVH[EVI8LIEQSYRXGSPPIGXIHIRWYVIW WYJJMGMIRXJYRHMRKMWEZEMPEFPIJSVLEVH[EVIEGUYMWMXMSRERH VITPEGIQIRX[LMPIEPWSGSRWMHIVMRKJYXYVIRIIHW8LIKSEPMW XSQMRMQM^IPEVKIJPYGXYEXMSRWXSXLIVEXIWXLEXEVIGLEVKIHXS XLIHITEVXQIRXWIEGL]IEV8LIVIZIRYIJSV*=MW QMPPMSR[LMGLMWVIPEXMZIP]JPEXGSQTEVIHXSXLI*= EHSTXIHFYHKIX 4'6)40%')1)28*92(97)7 8LIHMVIGXSTIVEXMRKI\TIRHMXYVIWSJXLI4'6ITPEGIQIRX*YRHEVIFYHKIXIHMRXLIGETMXEPSYXPE]GEXIKSV] '31498)6,%6(;%6)%'59-7-8-32 *=XS*= MRQMPPMSRW 'SQTYXIV,EVH[EVI%GUYMWMXMSRMRGPYHIWXLITYVGLEWISJ HIWOXSTGSQTYXIVWPETXSTWVYKKIHM^IHPETXSTWQSRMXSVW ERHTVMRXIVW8LIGSQTYXIVLEVH[EVIMRZIRXSV]JSVXLIIRXMVI GMX]MWEKKVIKEXIHEWSRIEWWIXERHMWXLYWGPEWWMJMIHEWE GETMXEPEWWIXSRXLIGMX]’WFEPERGIWLIIX8LI*= 'SQTYXIV,EVH[EVI%GUYMWMXMSREHSTXIHFYHKIXMW QMPPMSR[LMGLMWQMPPMSRPS[IVXLERXLI*= EHSTXIHFYHKIX8LII\TIRHMXYVIWZEV]JVSQ]IEVXS]IEV HITIRHMRKSRXLIVITPEGIQIRXWGLIHYPI 4'6)40%')1)28*92()2(-2+&%0%2') 8LI4'6ITPEGIQIRX*YRHIRHMRKFEPERGIZEVMIWTVMQEVMP]HYIXSXLILEVH[EVIVITPEGIQIRXWGLIHYPI8LIJYRHFEPERGIEXXLIIRH SJIEGL]IEVMRGPYHIWXLIEGGYQYPEXIHFEPERGIXSFIYWIHJSVJYXYVI]IEVLEVH[EVITYVGLEWIW8LI4'6ITPEGIQIRX*YRHIRHMRK FEPERGIMRGPYHIW3TIVEXMRK'SRXMRKIRG]ERH4'6ITPEGIQIRX*YRH&EPERGI *36)'%78 354 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | PC Replacement Fund 34)6%8-2+'328-2+)2'= *=XS*= MRQMPPMSRW 3TIVEXMRK'SRXMRKIRG]MWWIXEXQMPPMSRSJFYHKIX EYXLSVM^EXMSRXSSJJWIXYRJSVIWIIRI\TIRWIWXLEXQE]SGGYV HYVMRKXLIJMWGEP]IEV'SRXMRKIRG]JYRHWEVIYXMPM^IHSRP]EJXIV EPPFYHKIXSTXMSRWLEZIFIIRGSRWMHIVIHERHVIUYMVIW'MX] 'SYRGMPETTVSZEP 4'6)40%')1)28*92(&%0%2') *=XS*= MRQMPPMSRW 4'6ITPEGIQIRX*YRH&EPERGIEGGSYRXWJSV4'6ITPEGIQIRX *YRHVIQEMRMRKEJXIVXLIHIWMKREXMSRSJEPPSXLIVVIWIVZIWERH GSRXMRKIRGMIW8LI*=IRHMRKJYRHFEPERGIMW QMPPMSR8LMWFEPERGIVITVIWIRXWEREGGYQYPEXMSRSJWSYVGIWXS FIYWIHJSVJYXYVI]IEVLEVH[EVITYVGLEWIW8LIGMX]LEW QEHIIJJSVXWXSYXMPM^IEGGVYIHJYRHFEPERGIFIKMRRMRKMR*= F]EPMKRMRKXLI4'6ITPEGIQIRX*IIWERH'SQTYXIV ,EVH[EVI%GUYMWMXMSRW[MXLERXMGMTEXIHVITPEGIQIRX WGLIHYPIWXLVSYKLSYXXLIGMX] *36)'%78 &9(+)8 %'89%0*36)'%78 355 Table of Contents FY 2025/26 Adopted Budget 356 Table of Contents BUDGET BY FUND | Grant Funds Overview BUDGET BY FUND | Grant Funds FUND PURPOSE The Grant Funds receive and expend the city’s federal, state, and local grants. The amount of grants received is generally based upon application to granting agencies by the city and through entitlement grants and are contingent upon availability of funding by the grantors. Grant revenues may be used only for the stated purpose in the approved grant agreement and are subject to grantor expenditure guidelines and audits. The city will only expend grant funds that have been appropriately awarded by the granting agency and accepted in accordance with the city’s grant policy. Grant Funds Sources (% to Total) $24.8 Million Grant Funds Uses (% to Total) $24.8 Million Rounding differences may occur. 357 Table of Contents BUDGET BY FUND | Grant Funds Summary A d op t e d 2024/25 A d op t e d 2025/26 8,970,468 10,796,471 Grants CDBG 4,553,150 5,888,059 3,259,617 1,932,511 HOME Investment Partnership 1,438,820 1,020,699 18,222,055 19,637,740 6,332,480 4,000,000 4,000,000 10,332,480 4,000,000 R e v e nue s Housing Choice Voucher Program (a) Subtotal Other Activity Grants Anticipated(a) Grant Contingency Subtotal T r a ns f e r s I n CIP(b) - 1,192,098 - 1,192,098 28, 554, 535 24, 829, 838 8,970,467 4,553,150 10,796,471 5,945,322 3,236,176 2,805,678 1,438,820 1,270,699 18,198,613 20,818,170 18,198,613 20,818,170 6,332,480 4,000,000 4,000,000 Subtotal T o t a l So ur c e s E x p e nd i t ur e s Housing Choice Voucher Program (a) Grants CDBG HOME Investment Partnership Subtotal TOTAL OPERATING BUDGET Other Activity Grants Anticipated(a) Grant Contingency Subtotal Transfers Out CIP CIP Technology 10,332,480 4,000,000 23,442 11,668 - Subtotal T ot a l U s e s 23,442 11,668 28, 554, 535 24, 829, 838 Sources Over/(Under) Uses (a) Starting in FY 2025/26, anticipated grants are included in departments under the Grants category. CIP project DK09 - Construct the Residence at Paiute is not moving forward, so the funds will be transferred back to the original funding source. (b) 358 - Table of Contents BUDGET BY FUND | Grant Funds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’WMRGSQI*EQMPMIWQYWX FIMRGSQIIPMKMFPIFEWIHSRXLI4VSKVEQ-RGSQI+YMHIPMRIW 8LITVSKVEQTVSZMHIWEJJSVHEFPIERHWEJILSYWMRK STTSVXYRMXMIWJSVPS[IVMRGSQIJEQMPMIWWIRMSVGMXM^IRWERH TIVWSRW[MXLHMWEFMPMXMIW7XEJJIWXMQEXIWXLI,':EPPSGEXMSRW MRGPYHMRKTVMSV]IEV’WGEVV]SZIVJSV*=EX QMPPMSR8LIEGXYEPEQSYRXW[MPPZEV]HITIRHMRKSR[LIRXLI JYRHWEVIVIGIMZIHHYVMRKXLIJMWGEP]IEV +6%287 *=XS*= MRQMPPMSRW 1MWGIPPERISYWJIHIVEPWXEXIERHPSGEPKVERXWMRGPYHIKVERXW JSVPE[IRJSVGIQIRXJMVIWIVZMGIWLYQERWIVZMGIW XVERWTSVXEXMSRERHTVIWIVZEXMSRTVSNIGXW8LI*= FYHKIXIHVIZIRYIMWQMPPMSRVIJPIGXMRKEQMPPMSR MRGVIEWITVMQEVMP]HYIXSEGLERKIMRFYHKIXXVIEXQIRX &IKMRRMRKMR*=ERXMGMTEXIHKVERXWEVIMRGPYHIHMR HITEVXQIRXWYRHIVXLIGVERXsGEXIKSV] *36)'%78 &9(+)8 %'89%0*36)'%78 359 Table of Contents BUDGET BY FUND | Grant Funds '31192-8=():)0341)28&03'/+6%28 '(&+  '(&+6),%&6):30:-2+03%2 *=XS*= MRQMPPMSRW 8LI'MX]SJ7GSXXWHEPIVIGIMZIW'SQQYRMX](IZIPSTQIRX&PSGO +VERX '(&+ JYRHWJVSQXLI97(ITEVXQIRXSJ,SYWMRKERH 9VFER(IZIPSTQIRX ,9( '(&+JYRHWEVITVSZMHIHSRE JSVQYPEFEWMWXSIRXMXPIQIRXGSQQYRMXMIWXSHIZIPSTZMEFPI YVFERGSQQYRMXMIWF]TVSZMHMRKHIGIRXLSYWMRKWYMXEFPIPMZMRK IRZMVSRQIRXWERHSVF]I\TERHMRKIGSRSQMGSTTSVXYRMXMIW TVMQEVMP]JSVPS[XSQSHIVEXIMRGSQITIVWSRW7XEJJIWXMQEXIW XLI'(&+ERH'(&+6ILEF6IZSPZMRK0SER*YRHWMRGPYHMRK TVMSV]IEV’WGEVV]SZIVJSV*=EXQMPPMSR8LIWI JYRHEQSYRXW[MPPZEV]HITIRHMRKSR[LIRXLIJYRHWEVI VIGIMZIHHYVMRKXLIJMWGEP]IEV8LMWEPWSMRGPYHIWQMPPMSR MRFYHKIXJSV&IPPIZMI[6IRXEP3TIVEXMSRW ,31)-2:)781)284%682)67,-4 *=XS*= MRQMPPMSRW ,31)-RZIWXQIRX4EVXRIVWLMT*YRHWEVIVIGIMZIHXLVSYKLXLI 1EVMGSTE'SYRX],SQI'SRWSVXMYQ7XEJJIWXMQEXIWXLI ,31)EPPSGEXMSRMRGPYHMRKTVMSV]IEV’WGEVV]SZIVJSV*= EXQMPPMSR,31)*YRHWEGXYEPEQSYRXW[MPPZEV] HITIRHMRKSR[LIRXLIJYRHWEVIVIGIMZIHHYVMRKXLIJMWGEP ]IEV +6%287%28-'-4%8)( *=XS*= MRQMPPMSRW 8LIWIEVIERXMGMTEXIHKVERXWXLEXQE]FIVIGIMZIHXLVSYKLSYX XLIJMWGEP]IEVXSEMHMRXLIWYTTSVXSJEWTIGMJMIHJYRGXMSRSV YWIHJSVKIRIVEPTYVTSWIW7XEVXMRKMR*= ERXMGMTEXIHKVERXWEVIMRGPYHIHMRHITEVXQIRXWYRHIVXLI GVERXsGEXIKSV] *36)'%78 360 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Grant Funds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’WMRGSQI*EQMPMIWQYWX FIMRGSQIIPMKMFPIFEWIHSRXLI4VSKVEQ-RGSQI+YMHIPMRIW 8LITVSKVEQTVSZMHIWEJJSVHEFPIERHWEJILSYWMRK STTSVXYRMXMIWJSVPS[IVMRGSQIJEQMPMIWWIRMSVGMXM^IRWERH TIVWSRW[MXLHMWEFMPMXMIW7XEJJIWXMQEXIWXLI,:'EPPSGEXMSRW MRGPYHMRKTVMSV]IEV’WGEVV]SZIVMR*=EXQMPPMSR 8LIEGXYEPEQSYRXW[MPPZEV]HITIRHMRKSR[LIRXLIJYRHWEVI VIGIMZIHHYVMRKXLIJMWGEP]IEV *36)'%78 &9(+)8 %'89%0*36)'%78 361 Table of Contents BUDGET BY FUND | Grant Funds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’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able of Contents BUDGET BY FUND | Grant Funds +6%287%28-'-4%8)( *=XS*= MRQMPPMSRW 8LIWIEVIERXMGMTEXIHKVERXWXLEXQE]FIVIGIMZIHXLVSYKLSYX XLIJMWGEP]IEVXSEMHMRXLIWYTTSVXSJEWTIGMJMIHJYRGXMSRSV KIRIVEPTYVTSWIW7XEVXMRKMR*=ERXMGMTEXIHKVERXW EVIMRGPYHIHMRHITEVXQIRXWYRHIVXLIGVERXsGEXIKSV] +6%28'328-2+)2'= *=XS*= MRQMPPMSRW +VERX'SRXMRKIRG]TVSZMHIWJSVYRI\TIGXIHKVERXE[EVHWMR XLIIZIRXXLEXYRJSVIWIIRI\TIRWIWSGGYVHYVMRKXLIJMWGEP ]IEV[LMPIGSRHYGXMRKSTIVEXMSRW*SV*=XLIKVERX GSRXMRKIRG]MWQMPPMSR 86%27*)67398 8VERWJIVW3YXMWXLIEYXLSVM^IHQSZIQIRXSJGEWLSVSXLIVVIWSYVGIWXSSXLIVJYRHWERHSVGETMXEPTVSNIGXW *36)'%78 &9(+)8 %'89%0*36)'%78 363 Table of Contents BUDGET BY FUND | Grant Funds '-4 *=XS*= 8LIVIMWRSXVERWJIVSYXXSXLI'ETMXEP-QTVSZIQIRX4PER '-4  MRXLI*=EHSTXIHFYHKIXEWXLIERXMGMTEXIH VIMQFYVWIQIRXSJGETMXEPI\TIRWIW[MPPFIHMVIGXP]VIGSVHIHMR XLIGETMXEPFYHKIX '-48)',2303+= *=XS*= '-48IGLRSPSK]LIPTWGSZIVXLITSVXMSRSJGMX][MHIXIGLRSPSK] GETMXEPTVSNIGXW8LI*='-48IGLRSPSK]EHSTXIH FYHKIXMW *36)'%78 364 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Special Districts Fund FUND PURPOSE The Special Districts Fund is used to account for proceeds received from property owners in return for the city providing agreed-upon increased levels of municipal services beyond the standard level of core city services as allowed by statute. More specifically, the fund is used to account for the city’s streetlight districts. Special Districts Fund Sources (% to Total) $0.6 Million Special Districts Fund Uses (% to Total) $0.6 Million Rounding differences may occur. 365 Table of Contents BUDGET BY FUND | Special Districts Fund Summary Actual 20 23 / 24 Adopted 20 24 / 25 Forecast 20 24 / 25 Adopted 20 25 / 26 42,298 4 2 ,2 9 8 2,318 2 , 3 18 (2,327) (2 , 3 2 7 ) - 488,602 488,602 570,133 570,133 570,133 570,133 579,465 579,465 - - - 3,154 - - - 3,154 4 8 8 ,6 0 2 5 70 , 1 33 5 70 , 13 3 5 8 2 ,6 1 9 533,227 533,227 572,451 572,451 567,806 567,806 582,619 582,619 533,227 572,451 567,806 582,619 Total Uses 5 33 , 22 7 5 7 2 ,4 5 1 567 , 8 06 5 82 , 61 9 Sources Over/(Under) Uses (4 4 , 6 2 5 ) ( 2 , 3 18 ) 2, 3 27 - Ending Fund Balance Streetlight Districts Total Ending Fund Balance (2,327) ( 2 , 3 27) - - - Beginning Fund Balance Streetlight Districts Total Beginning Fund Balance Revenues Streetlight Districts Subtotal Transfers In Operating(a) Subtotal Total Sources Expenditures Streetlight Districts Subtotal TOTAL OPERATING BUDGET (a) FY 2025/26 transfer from the General Fund to cover the cost of a one-time property tax exemption. 366 Table of Contents BUDGET BY FUND | Special Districts Fund Five-Year Financial Forecast Beginning Fund Balance Streetlight Districts Total Beginning Fund Balance Revenues Streetlight Districts Subtotal Adopted 20 25 / 26 Forecast 20 26 / 27 Forecast 20 27 / 28 Forecast 20 28 / 29 Forecast 20 29 / 30 - - - - - 579,465 579,465 582,600 582,600 582,600 582,600 582,600 582,600 582,600 582,600 3,154 - - - - Transfers In Operating(a) Subtotal 3 ,1 5 4 - - - - 582 , 6 19 5 82 , 60 0 5 8 2 ,6 0 0 5 82 , 6 00 5 8 2 ,6 0 0 582,619 582,619 582,600 582,600 582,600 582,600 582,600 582,600 582,600 582,600 582,619 582,600 582,600 582,600 582,600 5 8 2 ,6 1 9 5 82 , 6 00 5 82 , 60 0 5 8 2 ,6 0 0 5 8 2 ,6 0 0 Sources Over/(Under) Uses - - - - - Ending Fund Balance Streetlight Districts Total Ending Fund Balance - - - - - Total Sources Expenditures Streetlight Districts Subtotal TOTAL OPERATING BUDGET Total Uses (a) FY 2025/26 transfer from the General Fund to cover the cost of a one-time property tax exemption. 367 Table of Contents BUDGET BY FUND | Special Districts Fund 74)'-%0(-786-'87*92(7396')7 7TIGMEP(MWXVMGXW*YRH7SYVGIWEVIHIVMZIHJVSQXLIPIZ]EWWIWWIHSRTVSTIVX]S[RIVW[MXLMRXLIGMX] WWXVIIXPMKLXHMWXVMGXW 786))80-+,8(-786-'87 *=XS*= MRQMPPMSRW 7XVIIXPMKLX(MWXVMGXW*YRHVIZIRYIVITVIWIRXWXLIPIZ]EWWIWWIH SRTVSTIVX]S[RIVW[MXLMRIEGLSJXLIGMX]’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’W7TIGMEP (MWXVMGXW*YRHIRHMRKFEPERGIMWEWJSPPS[W *36)'%78 368 &9(+)8 %'89%0*36)'%78 Table of Contents BUDGET BY FUND | Special Districts Fund 786))80-+,8(-786-'87 *=XS*= MRXLSYWERHW 8LI*=7XVIIXPMKLX(MWXVMGXWIRHMRKJYRHFEPERGIMW TVSNIGXIHXSFI8LIIRHMRKFEPERGIJVSQXLITVMSV]IEVIRH EQSYRXIMXLIVTSWMXMZISVRIKEXMZI[MPPFIGEVVMIHJSV[EVHXS XLIJYXYVI]IEVERHMWEZEMPEFPIXSFIVIFYHKIXIHYPXMQEXIP] VIHYGMRKXLII\MWXMRKVIWIVZIXSEFEPERGI -2.3 *36)'%78 &9(+)8 %'89%0*36)'%78 369 Table of Contents FY 2025/26 Adopted Budget 370