June 10 City Council meeting focuses on 2025-26 budget – and Upper Pinal Bridge gets new name

FY2025–26 Enterprise Funds Budget

Economic Development Director Linda Oddonetto presented the proposed FY2025–26 budgets for the City’s enterprise funds, including Water, Wastewater, the Half-Cent Excise Tax Fund, the Highway User Revenue Fund (HURF), and the Bridge Fund.

The enterprise budget aligns with the Council’s strategic action plan. Priorities include:

• Improving aging infrastructure to support current and future development
• Continuing the common line program
• Advancing the A+ effluent upgrade through a development agreement
• Supporting department capacity building and succession planning
• Improving quality of life through sidewalk and road repairs

For the Water Fund, projected revenues for the year are $6.3 million. Metered water sales have increased by 10% and now account for 75% of revenue, though projections remain conservative due to delayed development. The City continues to budget for the Army Corps 595 project, which is pending environmental review and tribal consultation. Reserves are being built in for PFAS mitigation, if necessary. The operating budget is $2.8 million, with a carryforward of over $2 million that includes operational contingencies, a well pump repair reserve, and match funds for a water conservation grant. Grant revenue totals $3.3 million, including Army Corps and conservation funding. Total expenses in the proposed water budget amount to $8.6 million.

The Wastewater Fund is projected to bring in $1.56 million through sewer revenues, an 8% increase from last year, and again, the projections are cautious due to development delays. The contingency amount is $312,560, and the fund includes a carryforward of $2.8 million; however, $1.63 million of that amount is being held pending the audit results. Capital highlights include a jetter truck expected to be in production by late summer, a new dump truck (to be shared with the Water department), and a $170,000 project reserve. The total expenses in the proposed budget amount to $4.37 million.

“When we talk about budget and we talk about enterprise funds, this is revenue that is specific to certain categories. It’s not a general fund.” Mayor Gameros

The Half-Cent Excise Tax Fund is forecasted at $725,000 and is used for lighting and street repairs. The contingency is $200,000, and capital outlay construction is $215,107, which includes a $60,000 match for an anticipated ADOT sidewalk grant and $158,000 for the Jess Hayes sidewalk project. City Manager Paul Jepson noted that these projects can pivot depending on grant outcomes, and a presentation will soon be brought to Council outlining plans for fleet, asphalt, sidewalk, and other infrastructure improvements.

The Highway User Revenue Fund (HURF) budget includes $1.03 million in revenue, an $898,233 operating budget, and $131,081 in contingency funds. A capital project reserve of $230,796 is being carried forward. The City has decided to self-fund the matching funds needed for the Army Corps 595 project, rather than taking on a WIFA loan, so $700,000 is being budgeted for this purpose. In the Wastewater department, the budget includes $200,000 for the Alpine Street common line program and $1 million for Evans Street, as well as $100,000 for the sewer master plan and $200,000 for manhole assessment. Oddonetto pointed out that the city has 900 manholes.

In the Bridge Fund, the City has allocated $3.2 million for Jesse Hayes sidewalks and $558,753 for the Cottonwood Bridge. John Angulo explained that the project includes collaboration with the railroad company to replace the crossing, add new asphalt to tie into Broad Street, and extend sidewalks toward the depot. The City is funding the project, while the railroad will handle construction using their designated contractors.

General Fund Council Contingency Reserve Policy adopted

In connection with the budget presentation, Council approved the adoption of a policy to govern the City’s general fund contingency reserves. Paul Jepson and Pat Walker, a financial advisor who has long worked with the City, presented the new policy. Key points of the policy include:

• Establishment of a $3 million Council Contingency Reserve for situations including emergencies, economic downturns, or strategic opportunities
• Creation of a $150,000 Capital Contingency Reserve Fund for smaller unplanned needs or time-sensitive opportunities
• Annual commitment to replenish spent funds up to $300,000 per year if the $3 million reserve is drawn down

Jepson explained that the $3 million reserve functions as a protected fund that cannot be accessed without formal Council action. The policy outlines appropriate uses, including natural disasters, unexpected agency actions, emergencies, or strategic opportunities. 

The new $150,000 capital contingency is designed for lower-level spending needs, such as small property purchases or unforeseen minor expenses. In past years, the City typically used $100,000 to $300,000 of the larger reserve, so this smaller fund will allow for more efficient management without dipping into the full reserve.

Staff emphasized that any unspent contingency funds at year’s end will roll back into the fund balance. If a major expense ever requires more than is available from unspent one-time funds, the policy stipulates that $300,000 be redirected annually from the general fund until the reserve is fully restored.

“There’s a sweet spot that you need to find that makes you feel comfortable with how much you have in your reserve, but you don’t want to tie up so much that you can’t get some of the things done that you need to do in order to serve your citizens.” Pat Walker

Councilman Gonzalez noted the importance of having a strong reserve for emergencies. He cautioned that FEMA does not always cover all submitted expenses, placing the burden of uncovered costs on the local jurisdiction. A contingency reserve like this helps ensure that Globe can recover from major events without needing to raise taxes or cut services.

Financial advisor Pat Walker confirmed that this policy aligns with the Government Finance Officers Association (GFOA) recommendations and will have a positive impact on Globe in the eyes of potential lenders.

Council moves forward with a tentative $57.5 million budget for FY2025-26

Council adopted the City’s tentative budget for FY2025-26, setting a maximum expenditure limit of $57,452,976. This figure includes $15 million in potential grant funding. A final budget hearing is scheduled for July 8, with the property tax levy adoption to follow on July 29.

Key Budget Highlights

• Contingency Reserve: $3 million to be set aside in council contingency
• Merit Increases: 2.5% merit raises for staff
• Fleet Upgrades:
  • Transitioning from leased vehicles to outright purchases
  • Acquisition of five Ford F-150s for police use
  • Two F-350 dump trucks and two Ford Rangers for Public Works
• Public Safety Staffing:
  • Addition of two non-sworn police scout positions
  • Conversion of a contracted victim advocate into a full-time city position
• One-Time Equipment:
  • Purchase of a new street sweeper and carry-forward of the jetter truck funded last year

Jepson outlined three major capital items not yet funded:

1. Ladder Fire Truck: A grant application is pending; earnest money has been set aside, but a final price lock is not yet secured.
2. New Fire Station: Design and construction funding options will be explored during the budget year.
3. Replacement of Well #4: Estimated at $1.2 million, the city is extending the lifespan of the current well to buy time for a complete redrill and funding strategy.

Tina Allen, Globe’s Finance Director, pointed out that the tentative budget is down 13% from last year, reflecting more realistic grant estimates and the absence of WIFA loans. General fund revenues are up $2.7 million over last year, including an 11% increase in city taxes over last year’s adopted budget. In terms of property tax, the rate was reduced from 1.2221 to 1.1892 to keep actual tax amounts steady, even when property values rise. New construction does contribute to a higher levy.

“You can’t continue to grow your city and grow your budget without the revenues growing.” Tina Allen

Departmental budget highlights include the following:

• Fire: A budget increase of approximately $300,000 results from PSPRS pension rate increases and overtime needs. The PSPRS component is expected to decrease in 2027. Overtime for wildland fires is now separately accounted for.
• Police: An increase of about $925,000 results mostly from the outright purchase of five new vehicles, as well as retirement and overtime. The police department budget also had impacts from PSPRS.
• Public Works: An increase of about $450,000 includes dump truck purchases, cemetery improvements, and a higher sanitation contract.
• Pool: A $95,000 increase is chiefly due to full-season operations. 35 part-time lifeguard positions are now formally included in staffing counts.
• Magistrate Court: Budget is up about $180,000 due to the transition back from Gila County and increased jail-related expenses.

The $15 million grant capacity includes room to receive grants, if awarded, that would fund water infrastructure projects, the new fire station and ladder truck, and federal design funds under application for major projects.

Upper Pinal Creek Bridge gets new name: Ruiz Canyon Bridge

Council approved the renaming of the Upper Pinal Creek Bridge to Ruiz Canyon Bridge, following a discussion at the last meeting where Councilman Pastor provided a packet of materials supporting the new name. 

At the previous meeting, Councilman Pastor explained that the name “Ruiz Canyon” had long-standing historical significance and the support of local residents.

Motions approved

Council also approved motions for the following:

• Accounts payable in the amount of $734,384.76
• Approving a change order to a contract in the amount of $5,714.80 with Earthquest for the Bailey Sewer Common Line Project. 
• Renewing a contract with Central Arizona Aging (formerly the Pinal-Gila Council for Senior Citizens) to continue funding services at the Globe Active Adult Center for FY2025–26. The agreement allows the City to receive a total of $78,698 in reimbursement for senior programming, including $29,396 for the Congregate Meal Program, $42,302 for the home-delivered meals program (Meals on Wheels), and $7,000 for the transportation program. Senior Accountant Dani Beathard noted that the City anticipates an additional $36,300 in verbally committed funding. This contract is renewed annually.
• Approving an application for a grant from Governor’s Office of Highway Safety for $7,000. If received, the grant would pay for enhanced traffic enforcement in Globe, including dedicated DUI task force operations and general overtime traffic patrols.
• Approving an application for a grant from the Tohono O’odham Nation for $37,650.90 to purchase a police department drone. Chief Walters explained that the drone would be used for a variety of public safety purposes, including search and rescue operations, special event monitoring, emergency response, and aerial inspections. Chief Walters said the PD’s drone program is expected to grow over time. In the short term, it will enhance situational awareness at public events. In the future, the department may explore additional uses such as documenting accident scenes, aiding responses in emergency situations, or supporting other city departments through inter-agency partnerships. Chief Walters noted that drone use must adhere to legal and privacy considerations.
• Awarding a contract to Rodriguez Construction in the amount of $37,686 for sidewalk repair and replacement. The work will take place at two locations: on Fifth Street between US60 and Maple, and in front of 143 South Broad Street near the Globe Salon. The project will cover approximately 1,500 square feet and is funded through the half-cent excise tax designated for street repair materials.
• Awarding on-call civil engineering services contract to Kimley-Horn & Associates, not to exceed $165,000, from July 1, 2025, through June 30, 2026. This early approval allows staff to begin work on the Beeline design task order.
• Approving the FY22–23 annual financial audit by Colby & Powell, previously presented. Jepson explained that council has to vote to accept the audit results due to a new legal requirement.

 

Members of the Globe City Council: Mayor Al Gameros, Vice Mayor Mike Stapleton (District 4), and Council members Freddy Rios (District 1), Mike Pastor (District 2), Jesse Leetham (District 3), Mariano Gonzalez (District 5), and Fernando Shipley (District 6). All members were in attendance at this meeting except Councilmen Leetham and Gonzalez.

To view this meeting online, visit City Council Meeting – June 10, 2025.

To view documents related to this meeting, click here. 

Full minutes can be found by going to the City Hall website 

The Globe City Council meets every second and fourth Tuesday of the month at 6:00 p.m. at City Hall. 

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