Axe the Tax Issues Press Release

PRESS RELEASE

Axe the Tax has a Better Game Plan for the Town's $2 Million Budget Surplus

Why impose a $28 million property tax when a surplus exists to build fields now?

Oro Valley — September 26, 2017: Axe the Tax, a group of concerned Oro Valley residents opposing the Naranja Park Bond-Proposition 454, is releasing a response to the recent Fiscal Year 16/17 results reported by the Town of Oro Valley. The town reported a “strong financial position” and a surplus of $2 million for this past fiscal year.

“We propose that the Town’s $2 million surplus be spent on Little League baseball fields for our youth,” stated Jim Horn, Axe the Tax PAC chairman. “Clearly the town has the means to accomplish this without a property tax on its residents.”

Petitioning for fiscal responsibility from town officials known for the financially irresponsible purchase of the El Con golf courses, Axe the Tax has highlighted that the $17 million Naranja Park Bond would ultimately cost taxpayers a total of $28 million, with interest, over the 20-year life of the bond. As it stands, only $5.6 million will be allocated toward seven sports fields. Two multi-sports fields are currently under construction with funding spread over two fiscal years 16/17 and 17/18.

Axe the Tax is confounded by the proposed bond following the town’s announcement of a $2 million surplus. These results confirm that the town has existing resources to continue building Naranja Park sports fields with the “pay as you go” strategy that has been utilized since 2008 when Oro Valley taxpayers voted against a $48.6 million bond for the Park.

Instead of imposing an unnecessary property tax to pay for this bond, Axe the Tax recommends using the $2 million surplus for an immediate start of construction of the baseball complex on a “pay as you go” development plan. The entire field area should be graded and irrigation should be installed. Two fields should be completed with lights.

In the fiscal year 18/19 budget, $1 million should be allocated to construct a third field with lighting and to build a concession stand with restrooms. This will complete the three-field Little League complex. Axe the Tax in Oro Valley stands by its position that the Naranja Park Bond-Proposition 454 is an unreasonable and irresponsible property tax for homeowners and commercial properties when the Town has resources to “pay as you go.”

Guest View: Jack Stinnett ~ Solving Oro Valley’s Sports Field Crisis

In November, Oro Valley residents will be given the opportunity to vote on the Town's proposed $17 million dollar Bond for Naranja Park improvements to be paid for by a $28 million dollar property tax.

The Mayor and Council voted 7-0 to place the Town Staff proposal on the ballot after a long session where coaches, soccer moms and youthful participants eloquently cited the need for more fields.

Let's look at some past history
In 2013, when I was the Chairman of the Parks and Recreation Advisory Board [PRAB], Oro Valley had only two soccer fields in Riverfront Park. These fields were worn out from overplay with 2-3 teams sharing a field during a practice.

Then in the fall of 2013, prior Town Manager, Greg Caton, exploited a town budget surplus of $1.9 million, added $400,000 of Bed Tax funds, and directed the Town Staff to develop a plan for additional fields at Naranja Park recommended by PRAB. Led by Paul Keesler, Director of Infrastructure Services and Kristi Diaz-Trahan, Parks and Recreation Director, the Town proposed building two new, irrigated and lighted soccer fields, a large and small dog park, a graded access road and a paved parking lot.

The Plan was presented to PRAB, unanimously approved and then approved by the Town Council. The new facilities were constructed at Naranja Park in 2014 within budget and have seen strong use and support. The Plan for Naranja Park at full build out was to have 8 soccer fields. PRAB members looked forward to the continued development of the Park.

Now let’s look at some recent history
Fate intervened, however, when Mayor Hiremath and his Majority-4 on Council quickly purchased the El Conquistador Golf and Tennis Club with its 3 golf courses, 31 Tennis courts, 8 racquet ball courts and swimming pool.

PRAB did not support this purchase because it was not what residents said they wanted in the Town's 2013 and 2014 surveys. Further, it was felt that this purchase would divert resources from developing Naranja Park.

The Town Council’s Misplaced Priorities
It would appear that resident concerns were well-founded since the Town has now lost $7 million between the golf course purchase and operating losses. At a cost of $350,000 for a lighted sports field, we could have built 20 new fields with the money the town has lost subsidizing golf. Going forward, the Town is budgeting to lose $2 million per year on golf operations (the equivalent cost of 6 more sports fields for every year that this fiasco continues).

Oro Valley doesn't need a $28 million dollar secondary property tax to build an adequate number of youth fields - the Town has the funds- our Mayor and Council just have the wrong priorities.

Some additional Town Council decisions that were deemed a higher priority than youth sports include:

• $2.1MM to bury TEP power lines along the recently widened Oracle Road = 6 fields not built.
• $2.6MM capital expense in this year's budget for a new Police Station Annex and Evidence Facility = 8 more fields not built.

This year’s budget already includes two additional sports fields
In a positive development, this year's FY 17/18 Town Manager's budget included $1.046 million for two additional soccer / multi-purpose fields in Naranja Park with grading already underway. These two additional fields (#3 and #4 plus the two fields at Riverfront Park) will give the Town a total of 6 well maintained, irrigated and lighted fields…three times what we had in 2013, but short of the total of 8 fields planned that I agree are needed.

Recommendation
My recommendation to residents is to vote NO on the $28 Million Naranja Bond and Property Tax and demand that our Town Council solve the need for fields by budgeting funds in the Town's operating plan. A $1 million dollar investment in FY 18/19 can build fields #5 and #6 in Naranja Park. Along with the two improved fields at Riverfront Park, this will provide the 8 multi-purpose fields we need.

Let's continue the Town's "pay as we go" development of Naranja Park by giving our youth a fair shake at budget time…not by wasting money on the wrong things and then taxing property owners to pay for the fields that our youngsters need.

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Jack Stinnett graduated from the U.S. Naval Academy and served on Minesweepers and Destroyers. After his military service, he was employed as an engineer and plant manager in the Nuclear Power industry, a factory manager in the automotive industry, Vice-President of a worldwide engine components business, and finished his career as President and CEO of Morris Material Handling in Milwaukee. He and his wife, Connie, moved to Oro Valley in 2011. He was a member of PRAB from 2012-2014, serving as Chairman in 2013-2014. He enjoys woodworking, biking, and visiting his grandchildren.

Deadline Tomorrow For Submitting Pro and Con Property Tax Arguments

The Town Of Oro Valley is proposing a secondary property for your approval on this November's election ballot. The funds from this tax are supposed to be used to pay for even more ballfields in Naranja Park, as we have previously posted.

The election pamphlet that you will receive will explain the tax. In doing so, the pamphlet will include arguments for and against the bond offering. The deadline for submitting those arguments is tomorrow.

Anyone may submit an argument for publication. However, as you will  note further, it will cost you a whopping $250 to do so.

However, LOVE welcomes all views. So you are welcome to send us a Guest View and, assuming it meets our guidelines (see right panel) we will publish it for free.

The following is the Town Of Oro Valley press release that presents further detail:
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"Deadline is Friday, July 21, to submit arguments “for” or “against” Naranja Park bond question 
 Oro Valley, Arizona (July 17, 2017) – As a reminder, any persons wishing to submit an argument “for” or “against” the Naranja Park bond question must do so by 5 p.m. this Friday, July 21, 2017. Arguments will be included in the informational voter pamphlet that is prepared and mailed to each household with a registered voter not less than 35 days before the date of the election. The bond question will appear on the November 7, 2017 ballot.

Arguments must meet the following requirements in order to be accepted for publication:

• Argument shall not exceed 300 words in length. 
• Argument shall contain a sworn statement of each person sponsoring it. 
• Argument shall include the residence or post office address and telephone number of each person signing the argument. 
• Argument shall be submitted to the Oro Valley Town Clerk in an electronic format, preferably Microsoft Word.
• Argument shall include a payment of $250 (as allowed by Arizona state law). 
• As required by law, all information—including the $250 fee—must be received by the Oro Valley Town Clerk by 5 p.m. on Friday, July 21, 2017.

For complete details on submitting an argument, you may read the official Public Notice from the Clerk’s Office. Click or copy/paste this URL into your browser: https://www.orovalleyaz.gov/sites/default/files/media/docs/2017/instructions-submitting-arguments-or-against.pdf

To learn more about the Naranja Park Bond Project, please review the May 4, 2017 press release and the project overview document at the links provided below.

• May 4, 2017 press release: https://www.orovalleyaz.gov/town/news/naranja-park-bond-question-will-be-placed-november-ballot 
• Map and project overview: https://www.orovalleyaz.gov/sites/default/files/media/docs/2017/naranjaparkbond-projectsheet-web.pdf "

PAC Formed to Oppose Naranja Park Bond

A PAC has been formed to oppose Proposition 454 -- The Naranja Park Bond. Stay tuned to LOVE for future updates including the launch of the PAC's website. An email address will also be provided where citizens can submit questions and comments.

For those of you who are not already familiar with the details of the $17 million dollar Naranja Bond, we previously reported the following on LOVE:

"The bond will cost nearly double due to the interest, bringing the total cost to $28 million dollars, thus the need for a secondary property tax.  Council members are claiming that this is not a property tax.  That's because they all ran on the promise of never agreeing to a property tax.  However, a 20-year secondary property tax on top of our already high Pima County primary property tax is definitely a property tax and it will create an unnecessary burden on many of us."

You can learn more about the bond by clicking HERE to read, "The $28 Million Dollar Question."

Editorial ~ The El Conquistador Purchase from HSL appears to be the most Irresponsible Decision in the History of Oro Valley

On tonight’s Town Council agenda (Wednesday, June 21, 2017) is a discussion for possible action to amend the Fiscal Year 16/17 budget before it expires on June 30th. The Finance Director is requesting that the Council allow for a reallocation of an expected $2 million dollar General Fund surplus. What does this mean? If the Council approves this reallocation, instead of adding the $2 million surplus to the General Fund Contingency, they will instead add only $300,000.

Here’s the plan:
The Finance Director is requesting that the Council take $350,000 of the surplus and direct it to the Community and Recreation Center Fund (CRC). Keep in mind how the Mayor and his minions have stated time and time again how there’s no need to worry because, "We have a fund to cover all the golf and community center expenses.” That fund is the CRC which is funded with the half-cent sales tax increase. (The remaining allocations are explained at the end of this article).

The Council report states:

"Based on year-end budget projections presented in the April financial reports, it is estimated that the Community Center Fund will end the year with an estimated deficit of $285,000, including the $120,000 loan repayment transfer to the General Fund. Contributing factors to this deficit are mainly water costs due to unseasonably warm and dry weather conditions this spring and golf member dues revenues trending under budget. Staff is recommending a transfer of $350,000 from the estimated year-end General Fund surplus amount of nearly $2 million into this fund to close the deficit and provide a minimal positive fund balance to begin FY 2017/18.”

Robbing Peter to pay Paul
In other words, the half-cent sales tax is NOT covering the expenses as promised. Therefore, in order to begin the new fiscal year with a positive CRC Fund balance and to meet this year’s $120,000 loan repayment obligation back to the General Fund Contingency, they want to transfer $350,000 from the General Fund into the CRC Fund.

(As a reminder, in 2015, the Council borrowed $1.2 million from the General Fund Contingency to start the CRC Fund with a promise to repay it at $120,000 per year for 10 years. Due to lack of funds, the Town Council already reneged on the first year’s payment in 2016. Now, in 2017, still lacking the funds, they want to repay it by transferring money from one account to another.)

What has this foolish purchase cost the citizens of Oro Valley so far?

• $1 million to purchase the Community Center and Golf Courses
• $1.2 million taken from the General Fund Contingency to start the CRC Fund
• $350,000 in additional General Fund revenues to keep the CRC Fund in a "minimal positive balance”
• $506,710 in additional sales tax revenues in FY 14/15
• $2,030,750 in additional sales tax revenues in FY 15/16
• $1,811,207 in additional sales tax revenues so far in FY 16/17 (through April 30th)

TOTAL COST: $6,898,667

It’s a Matter of Trust
Remember, these are the same irresponsible people who are now asking Oro Valley citizens to approve a Secondary Property Tax to fund ball fields. They actually expect us to trust them with another $17 million dollars in light of this record?
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Addendum
Additionally (but unrelated to the Community Center) the Town is also requesting $300,000 to be allocated to the Self-Insurance Benefit Fund which is expecting a year-end deficit of $200,000-$250,000 plus an estimated $1,073,051 to refund excess employee contributions made into the Public Safety Personnel Retirement System (PSPRS). This will provide lump-sum reimbursement payments to the Town’s PSPRS members. You can read the entire Executive Summary by clicking here:

The Watchdog Report: By Mike Zinkin

Despite tourist and snowbird season, losses continue at the Oro Valley Golf and Community Center

The numbers are in for April 2017 and continue to reveal the irresponsible investment in the Golf and Community Center. Keep in mind that April is one of the months that the Town looks forward to because it is in the heart of the tourist and snowbird season.

So far this fiscal year (July 2016 through April 2017) the Town's expenditures (fitness, recreation programs, swim) exceeded its revenues by $94,006. As noted in prior months, this loss is tolerable because this is the Community Center portion of the investment.

However, Troon's losses (food, beverage, golf) for the same period were $1,954,005. Together these losses total $2,048,011. The losses were offset by the sales tax revenues of $1,811,207.

Turning a $2800 surplus into a $285,000 deficit in just one month
Through April 2017, the Community and Recreation Center Fund (CRF) is $284,583 in the red. (This fund was started by taking $1.2 million from the General Fund Contingency). The March financials indicated that the CRF was forecasted to end the fiscal year with a positive balance of $2,834. However, this was updated in April to show that the CRF will now end the fiscal year $284,971 in the red. If this forecast comes to fruition, once again the Town Council will be forced to delay the promised yearly $120,000 payback to the General Fund Contingency.

Troon’s crystal ball continues to malfunction

Troon forecasted golf losses to be $63,685 for April 2017, but the actual losses were $144,954. That’s a $81,269 miscalculation. Troon's original forecast to lose $1,534,505 in FY 16/17 has recently been updated to $2,346,563. This is a miscalculation of $812,058, or 44%.

In the new FY 17/18 budget, Troon forecasts losses of $1,822,941 but history tells us it will be over $2,000,000 again.

The food and beverage portion, (primarily the Overlook Restaurant) was forecasted to make $29,241. The actual number came in at a loss of $6,714. So far this fiscal year, The Overlook Restaurant has lost $100,420. April brings the end to the high season. What can we expect in May and June as the fiscal year comes to a close?

It’s about fiscal responsibility
The current Council is asking the citizens to approve a Secondary Property Tax for Naranja Park improvements. Consider how many improvements could be accomplished at Naranja Park without the burden of an additional property tax if the Town wasn’t spending $2,000,000 per year to cover golf and restaurant losses at the Community Center.

Didn’t I already pay for this?
One might believe, since it is called a Community Center, that it would be available to the residents at no cost. Isn’t the community already paying for it through the additional half cent sales tax to support it? One might think that a citizen could use the driving range and golf practice facilities, or even swim in one of the two pools or play tennis as a benefit of being a citizen of Oro Valley. However, the only way a citizen can utilize any amenity at the Community Center is to pay for it.

Again, this raises the question: Is it a center for the community or is it a private club being subsidized by the Citizens of Oro Valley?

Mike Zinkin has a Bachelor’s degree in history and government from the University of Arizona and a Master’s degree in Social and Philosophical Foundations of Education from California State University, Northridge. He was a commissioned ensign in the United States Navy Reserve in 1969. He worked as an Air Traffic Controller for 30 years. He and his wife moved to Oro Valley after retiring in 1998. Mike served on the Oro Valley Development Review Board from 2005-2009, the Board of Adjustment from 2011-2012, and the Town Council from 2012-2016. During his time on council, he was named as one of 23 Leadership Fellows for the National League of Cities University, he was a member of the National League of Cities Steering Committee for Community and Economic Development, and a member of the Arizona League of Cities Budget and Economic Development Committee.

Last chance to give your input before the council vote tonight

At tonight’s Council Meeting beginning at 6 PM, you will have a chance to give input about the $17 million dollar bond and secondary property tax to add soccer and ball fields at Naranja Park.   The bond cost will nearly double due to the interest, bringing the total cost to $28 million dollars, thus, the need for a secondary property tax.

Council members are claiming that this is not a property tax.   That’s because they all ran on the promise of never agreeing to a property tax.   However, a 20-year secondary property tax on top of our already high Pima County primary property tax is definitely a property tax and it will create an unnecessary burden on many of us. 

PUBLIC COMMENT:  Ordering and calling a special bond election to be held in and for the Town of Oro Valley, Arizona, on November 7, 2017, to submit to qualified electors thereof the question of authorizing the issuance and sale of General Obligation Bonds and a Secondary Property Tax as security for improvements for Naranja Park. 

This will be a short meeting as this is the only item on the Regular Agenda.

Please attend this council meeting and make a short statement (complete a Blue Speaker Card located on the back table) or e-mail the Mayor and each Council Member to let them know what you think.   Remember to send a copy to Jessica Hynd (jhynd@orovalleyaz.gov) and ask that your message be placed in the Council Packet.

E-mail addresses for the mayor and council are below:

shiremath@orovalleyaz.gov (Mayor)
lwaters@orovalleyaz.gov
rpina@orovalleyaz.gov
msnider@orovalleyaz.gov
brodman@orovalleyaz.gov
jhornat@orovalleyaz.gov
ssolomon@orovalleyaz.gov
dsharp@orovalleyaz.gov (Acting Town Manager)