Town Deals With Growing Pains

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While economic forecasters continue to predict a market slowdown, Payson continues to grow at a stable pace. Anyone you talk to around the state is predicting that growth will slow, said Bob Gould, Payson's community development director.


"We have been predicting a slowdown for two or three years now, but it seems to hold steady," Gould said.


Looking at the numbers for the first half of 1999 compared to the first half of 1998, Payson appears to grow in small increments, taking a step backward only in the raw land department.

It is not a lack of empty lots that caused the drop, said Bob Flibotte, associate broker for Coldwell Banker Bishop Realty.


There are three reasons for the decrease in land sales, he said. Land is more expensive, interest on loans for land is not deductible and impact fees are assessed by the Town of Payson.


"The classic example is a lot I have listed in Payson Ranchos. The marker says (value is) $30,000. As I called the various entities (of the town), impact and capacity fees came to $11,450," Flibotte said. "Those figures are different from subdivision to subdivision, street to street, lot to lot. It is a crazy quilt pattern -- you have no idea what the dollar figure will be.


"The net result is that the house is more expensive," he said. "When the tax man cometh, he bases his taxes on the value of a home; if the value continues to go up the assessed valuation grows." He adds that it won't take long for a supply-sided economy to price people out of town.


In 1999, Chaparral Pines, the Rim Club and Wal-Mart were major components in the construction valuation numbers. Bigger, more expensive housing in the two residential developments can also alter the numbers, Gould said.


"If not for those, we would have had a major slowdown," Gould said.


Each year has had its factors, reasons why Payson and the State of Arizona have not seen a slower economy.


"We can come up with conjecture, but whether or not we are right is hard to say," Gould said.


"Basic growth, that is all I have seen," said Glenn Smith, chief financial officer for the Town of Payson. "The economy has been good all over the state, to a degree," he said. "If tourism stays up or maintains a steady growth in the state, they also reflect that."


Smith pointed out that for the last 10 years, Payson has had incredible growth and it shows in the numbers. In the fiscal year 1990-91, Payson took in $1.9 million in sales tax revenue. For the fiscal year 1999-2000, Smith is projecting $5 million.


"We are jumping $3 to $4 million. We have done it in huge growth," he said.


He cited permit fees as another indicator of growth. In fiscal year 1990-91, permit fees were reported as $96,000; for fiscal year 1998/99, it was $330,000.


"It is moving up and down, but it has been in the $300,000 range for the last five years," Smith said. "I see it slowing down but, I don't see it this year."

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