P.L.A.N. Update - Budget Balancing Acts‏

State Budget Hits Hard

Budget documents began circulating mid-week, detailing the current majority plan to close the State’s $2.7 billion deficit. The proposal would cut or eliminate functions of state government to the tune of $1.1 billion. The remaining gap would be filled with $1 billion in new revenue from the temporary sales tax increase (assuming it is adopted), and defer $450 million in K – 12 and university spending.

In addition, the draft plan requires cities to "contribute" $20 million in sales tax revenue sharing to counties. This measure is meant to partially offset the costs associated with shifting the state’s juvenile corrections responsibility to counties. Phoenix and other cities do not operate juvenile courts, so we're asking why cities should pay.

We expect the Governor to call a seventh special session this coming Monday to adopt this budget plan. If the apparent agreement holds through the weekend, the bills should be released on Monday, with a vote to follow on Tuesday. Our estimate is that Phoenix's share of such a "contribution" would be $6 million. Local Transportation Assistance lottery funds are also being swept in the budget plan. If the full amount is diverted, Phoenix's share of these transit dollars would be another $8 million. This State budget plan will most certainly would result in the Council having to revisit potential cuts to Police, Fire and other vital City services including transit. Please remind your state legislators of the importance of revenue sharing and ask them to vote against this bad idea.

Phoenix City Council Adopts Final Budget Proposal

The city of Phoenix Trial budget was initially presented to the City Council on February 2. Since then, 18 community meetings took place where residents shared their thoughts and ideas on the proposed balanced budget. After a full day of consideration at the Council Policy Session, the Phoenix City Council adopted the final budget package on March 2. If the Legislature is successful in diverting shared revenue and transit funds, the budget will have to be rebalanced.

Source: City of Phoenix