The Marana Town Council unanimously approved the tentative budget for fiscal year 2023-2024 during its regular meeting on May 16.
Weeks after discussing the proposal, the finance department presented a revised budget of around $336.3 million, an increase from the initial $247.9 million. Council will meet to review the final budget June 20 to officially adopt it for 2023-2024.
Financial director Yiannis Kalaitzidis walked through the changes with the council, mentioning how they often occur after staff receives more specific information and requests from departments.
“A few weeks ago, on April 18, we presented the manager’s budget to the council,” Kalaitzidis said. “I did mention, as it is normal, between manager’s and tentative budget, we do have changes that happen. We refine our budget, but we also take another look at some of our capital projects.”
The official budget for 2023-2024 is a 44% increase from fiscal year 2022-2023 at $233.5 million. Kalaitzidis noted this change reflects updates in department and capital needs, but also as staff has projected an increased revenue that Marana can add to its initial plan.
He explained the increase came from updated tax revenues and will still balance out the increased budget, according to their plan.
“A lot of that increase is related to revenues that we will receive to cover it, and a lot of it is also carried forward,” Kalaitzidis said. “Not very much of it was truly ‘new money.’ A majority took a place toward capital projects.”
The tentative budget is spread between capital outlay at 65%, operation costs at 30% and debt service at 5%. Operating costs have increased from $97.6 million to $100.4 million, and capital outlay has increased from $205.7 million to $219.1 million.
Staff estimated the town will collect $175,681,277 in total revenues, excluding secondary property taxes in special taxing districts.
In the proposal meeting, the director explained the town would spend more money than it would bring in due mostly to capital outlay, which took over two-thirds of the budget. Kalaitzidis also mentioned to the council that, aside from one-time investments, continuing payments are covered by consistent revenues.
“As in prior years, our budget is structurally balanced,” Kalaitzidis said. “Our ongoing revenues cover our ongoing expenses. And, as always, we make investments in a number of areas which we covered in our previous presentation and reflected in our tentative budget.”
The newly proposed capital improvement plan is part of the outlay and will take up 62% of the tentative budget at over $209 million. The CIP includes the Community and Aquatics Center, among other town infrastructure additions and improvements.
The CIP will span over five years and be paid off through the strategic debt financing plan proposed by the finance department. Revenues of 2023 will also be used to pay off a portion of the larger budget, as Kalaitzidis mentioned they came in higher than anticipated and the remainder will carry over for 2024.
“We will have it paid back as soon as we can as we raise enough funding,” Kalaitzidis said. “We are going to take steps to structure the debt in such a way that we can have an earlier payoff than the normal 20-25 years of these debt issuances.”
While staff may change portions of the plan before the final meeting, its recent decision has established an expenditure limit. The town’s budget will not exceed $336.3 million.
“After tonight, and when we come to you again… we cannot make increases to the budget,” Kalaitzidis said. “This is our ceiling for the total amount. If we do need to make any changes, we can only reallocate within this amount.”
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