Star Valley Council Keeps Lid On Coffers

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With tax revenues unpredictable next year, the town of Star Valley isn’t taking any risks with its proposed budget, preferring to keep its rainy day fund life jacket securely fastened.

Storm clouds have been brewing over state-shared revenue for months, and most towns in Arizona expect big drops in income and sales tax as the state deals with a massive deficit.

Star Valley anticipates state and photo enforcement revenues will drop 25 percent, with town sales tax falling 15 percent in 2010-2011.

“Revenues are going to be very shaky,” Vern Leis, councilor and budget committee member said. “Future revenues are absolutely unpredictable.”

With a drop in revenue expected, the town is planning to pad its rainy day fund with an additional $152,000 in reserves, $300,000 in a contingency fund and leave another $239,000 unallocated, just in case unexpected costs occur.

Financial Consultant Glenn Smith said it is important Star Valley does not appropriate 100 percent of its income, which former Town Manager Vito Tedeschi did several years ago.

“If you had spent it all (like he planned), you would have been broke,” Smith said at a recent budget committee meeting.

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The Town of Star Valley celebrated its new town hall May 13 with an open house party and rededication ceremony. Residents oohed and aahed at the newly remodeled space at 3675 E. Highway 260, which includes a large reception space complete with fireplace and vaulted ceilings, enough office space to accommodate all town employees and even a room for committee meetings. The event included a proclamation naming the building in memory of the late Diane McDaniel, who was instrumental in Star Valley’s incorporation and development. Mayor Bill Rappaport (at right) attended and greeted residents on the property’s front lawn.

Town Manager/Attorney Tim Grier said the town is taking a “miserly” approach with next year’s budget, referring to a recent Roundup editorial that said the council deserved credit “for its miserly ways.”

However, this doesn’t mean the town isn’t planning to spend on several major projects.

The town is budgeting $75,000 to remodel the newly acquired town hall; $85,000 on flood water projects; $163,000 to start a water project that includes purchasing a well and setting up a small, but domestic water supply so the town can apply for a share of Blue Ridge water; and putting $150,000 toward the town site act.

This puts the total for capital projects at $473,000, a 14 percent increase in spending over 2009-2010. In 2009, the town spent the majority of funds on purchasing town hall, beginning its remodel and repaving town streets.

Along with town projects, the 2010-2011 budget proposes giving town employees a cost of living increase and a raise.

Grier said the town should take care of its employees, who were hired at a discount.

Overall, the proposed budget for 2010-2011 anticipates a 32-percent drop in revenues compared with 2009-2010. Even photo enforcement revenue is expected to take a hit, dropping 25 percent.

At prior council meetings, Grier said it is misleading when the press prints that the town brings in a million in revenue from the cameras because this does not take into account court, administrative and other fees. When you consider those fees, the town grossed roughly $525,000 in 2009-2010.

In the 2010-2011 proposed budget, the town expects to gross $233,300, a 56-percent decrease.

The town recently added two new photo enforcement cameras at opposite ends of town, which could bring in additional revenue with an increased number of tickets. However, more tickets mean more processing fees.

Nonetheless, for a system that is “revenue neutral,” photo enforcement fines are the town’s largest revenue source, accounting for roughly 27 percent.

Other highlights of the proposed budget include spending $916,000 for operations, $413,000 for personnel services, $500,000 for capital outlay and $140,000 to maintain and improve roads.

The council could adopt the preliminary budget on June 1 with the final budget for 2010-11 adopted June 15.

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