Oro Valley Council Continues Discussion On Adding Three New Taxes

Three new taxes continue to be under consideration
The Oro Valley Town Council met October 15 to continue its study session on three proposed taxes — a use tax, a telecommunications tax, and a commercial rental tax. These taxes are already collected by Tucson, Marana, and Sahuarita. Town staff said they would help maintain services as costs rise and state-shared revenues flatten. We have reported on the council's four previous discussions of this item.

Estimated annual revenue impact of up to $2 million
Finance Director David Gephart said the three taxes could generate between $930,000 and $1.9 million annually:

• Use tax: $375,000 to $600,000
• Telecommunications tax: $130,000 to $280,000
• Commercial rental tax: $425,000 to $1,000,000

He said the goal is to diversify the Town’s revenues, reduce dependence on sales tax, and avoid introducing a property tax.

Staff would like to see funds dedicated for capital spending

If adopted, staff recommends that revenue from the new taxes be earmarked by Council for capital projects such as the newly acquired Police Department building, which currently lack a dedicated funding source. Final money dedication would require Council action (ordinance, fund setup, or budget transfer). Otherwise the funds can be used for any town operating or capital need. Council has not taken a position on this.

Businesses say new taxes would hurt competitiveness
Oro Valley Chamber of Commerce President Kristen Sharp told the Council that the commercial rental tax would make it harder for local businesses to remain competitive when operating costs in Oro Valley are already higher than in surrounding areas. She said businesses are “operating on tight margins” and warned that higher costs could discourage new tenants or drive existing ones away.

Commercial real estate broker Robert Tomlinson presented data showing Oro Valley’s retail vacancy rate at 12.8%, more than double the Tucson-area average of 5.9%. He said the new tax could further weaken the retail sector and increase vacant space.

Move would diversify Oro Valley's revenue stream
Joyce Garland, a 25-year Oro Valley resident and former Chief Financial Officer for Tucson, supported adopting all three taxes. She said state-shared revenues are declining because Oro Valley’s population is growing by less than one percent a year while new cities, such as San Tan Valley, are being incorporated. That means Oro Valley’s share of the statewide revenue “pie” continues to shrink.

Garland said a broader mix of local revenues would give the Town flexibility and protect services from future shortfalls. The Budget and Finance Commission, which she chairs, voted September 16 to recommend approval of the proposals.

Implementation of taxes would not happen until July of 2026 if they are approved by council
Gephart he will bring implementation proposals back for another study session before any vote. He explained that the Arizona Department of Revenue recently changed its reporting process for municipal tax code updates, and Oro Valley is the first community to use it. Because of that, there are questions about timing and notification requirements that must be resolved before moving forward. He said staff may recommend a phased implementation beginning in July 2026. 

Council weighs fairness and economic impacts
Councilmember Robb said she supports the use tax because it applies broadly and fairly but remains undecided about the other two. Vice Mayor Barrett questioned whether the rental tax would truly harm competitiveness, noting that neighboring towns already have similar taxes. Councilmember Nicolson said that because most Oro Valley commercial centers are owned by large, out-of-state corporations. These are landlords who are unlikely to pass the added cost on to their tenants — many of whom are small, locally owned businesses. He explained that these are landlords operate under corporate financial models that prioritize maintaining profit margins, leaving little flexibility to adjust lease terms or absorb new costs locally.

Next step: Yet another study session
No formal action was taken. The Council will revisit the issue at a future study session before deciding whether to notify affected businesses and schedule a vote. 

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"550" State Land Annexation Back on the Table (Part 2 ): Many Unanswered questions

Yesterday we reported on the presentation by consultant Mark Longacre, the State Land Department’s new annexation process, and council concerns about such. Today we discuss other  unanswered questions and concerns raised by the Town Council about whether annexing these State Lands makes sense for Oro Valley.

Where will the water come from?
Several Council members questioned whether Oro Valley has sufficient water to support annexing and developing the State Trust Land. Vice Mayor Melanie Barrett noted the property would rely entirely on CAP water, which could increase rates for all residents. Water Utility Director Peter Abraham said full build-out would require roughly 1,000 acre-feet per year [See bases of estimate after article] and flagged uncertainty after 2026 when the current Colorado River drought-contingency plan expires. He added that the Town’s infrastructure could serve the property, but future CAP cuts could make that service unsustainable.

Is this annexation economically feasible?
Several Council members questioned whether annexation would make financial sense. Councilmembers Jones-Ivey, Nicholson, and Murphy pointed to prior analyses indicating the project would be viable only with substantial commercial/retail development. They observed that nearby Marana centers already meet most retail demand, leaving limited room for new stores. Nicholson added that local sales tax is about 44% of Town revenue, while residential growth alone generates limited ongoing income. Without sufficient retail, the Town could face added service costs without offsetting revenue.

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Environmental and sensitive-lands considerations
Council members raised concerns about the site’s environmentally sensitive features. Barrett cited the large number of saguaros, ironwoods, and washes mapped on the property and said any plan would likely need a low-density “finger” pattern similar to nearby Marana to preserve natural corridors. Earlier work under an Environmentally Sensitive Lands Overlay (ESLO) identified core resource areas and resource-management zones that would significantly limit where construction could occur.

Are there State Lands on Oracle better suited to the Town? Shouldn't the town identify and pursue these first?
Councilmember Josh Nicholson suggested exploring other State Land parcels—particularly along Oracle Road—where utilities and existing retail make development more practical. He argued those sites could generate revenue without the environmental and infrastructure challenges of the 888-acre tract near Tangerine Road.

Why act now?
Councilmember Murphy questioned the urgency to proceed, noting Marana has shown no interest in the property and there is no immediate development pressure. She favored waiting until financial conditions, water availability, and public sentiment clearly support such an expansion.

Shouldn’t the town first consider the financial prospect and resident interest to annexing this property before opening conversation with the State?

Vice Mayor Barrett and Councilmember Murphy said the sequence in the new State Land Department process should be reversed. They argued that public engagement and an updated fiscal analysis must occur before requesting a Planning Authorization Letter (PAL) or hiring consultants. Both cautioned against spending Town funds before residents are heard and the economic implications are clear, reminding colleagues the last attempt faced strong opposition over density, traffic, and environmental impacts. Members also noted the Town would be navigating an untested, jurisdiction-led process with uncertain outcomes and potential procedural conflicts with the State.

Council wants more confidence that State Land annexation process has really changed and will remain that way

There was no formal Council direction to pursue annexation further. Members agreed that too many questions remain—about the process’s stability, the Town’s water capacity, and fiscal viability—to justify moving ahead now. The topic may be revisited after the State clarifies its administrative approach and there is more evidence from other jurisdictions or updated local analyses.

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Note: Oro Valley’s current Central Arizona Project (CAP) allocation is about 10,305 acre-feet per year. The estimated 1,000 acre-feet of water needed for full build-out of the State Trust Land would represent roughly 10% of the Town’s total CAP supply. Water Utility Director Peter Abraham said this estimate assumes that the entire area would eventually be developed, using typical Oro Valley per-acre water demand rates for mixed residential and limited commercial uses. He also assumed the property would rely entirely on CAP water—not groundwater—and that current CAP allocation levels remain stable. Abraham noted that nearly all of Oro Valley’s existing CAP supply is already committed to current customers, meaning such an annexation would reduce the Town’s flexibility during future CAP shortages or to support other growth areas.

"550" State Land Annexation Back on the Table (Part 1)

Council talks State Lands… again
The Oro Valley Town Council discussed the 852 acres of State Trust Land west of town. Discussion of annexing this property has been dormant for years because the State Land Department was understaffed. In addition, no council identified a compelling reason to pursue annexation on the state’s terms, since there was no lasting economic benefit to the Town. There was also significant community opposition when the idea was last publicly vetted. (Past LOVE coverage.)

Consultant says: Things have changed
Consultant Mark Longacre of WLB Group, an LJA Engineering company, told the Council that recent changes at the Arizona State Land Department make it worthwhile for Oro Valley to take another look at annexing the 550 acres south of Tangerine Road. Longacre’s firm was retained by the Town specifically to research background information, refresh prior work from about eight years ago, and participate in the October 15 study session—nothing beyond that.

 "The properties currently under consideration for annexation

by the Town of Oro Valley are the two State Land‐ owned sites

indicated on the map below, referred to as Tangerine North

(302 acres), and Tangerine South (550 acres)."

Towns now have more say in permitted uses
In the past, consultants worked directly for the State Land Department, which controlled planning and zoning of State Trust Land it intended to sell. Longacre told the council that the process has shifted in favor the the annexing community. The State now prefers that consultants work directly for the local jurisdiction—in this case, the Town of Oro Valley—to guide entitlement and planning. The State remains involved in an advisory role. Longacre called this a “culture shift” that gives local governments more control over how the land is planned and developed, making it a reasonable time for the Town to reconsider annexation.

Winfield puts on the brakes: What is the change, really—and will it last?
Mayor Joe Winfield questioned the legitimacy and permanence of the State Land Department’s new approach. He asked whether the change is grounded in formal legislation or is simply an internal administrative decision. If it’s merely administrative, a future administration could reverse it, leaving the Town exposed after investing time and money. He noted Oro Valley has seen similar setbacks before, such as the Arroyo Grande effort.

Consultant: administrative—and untested
Longacre confirmed the new process was introduced under the current governor’s administration, not by statute, and he did not know whether it is formally documented or codified. He agreed that this uncertainty poses a risk and suggested seeking written assurances or an agreement from the State Land Department to ensure continuity regardless of future political changes.

No track record yet
Several Council members expressed concern that neither Longacre nor the State Land Department has experience with the new jurisdiction-led entitlement model. With no track record to guide the process, the Town would be navigating an untested system with uncertain outcomes and possible procedural conflicts between the Town and the State.  Longacre admitted that his firm have no direct experience with the new process and have not yet seen it in practice, though he claimed to just beginning a similar engagement with another jurisdiction and does not know whether the approach will endure over time.

Tomorrow
Needless to say, council members had many questions regarding the annexation and its feasibility.  More on their concerns tomorrow.

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Take Ten: Tell Us How To Shape Oro Valley's Water Future

Let’s talk water
Water is the most valuable resource in any desert community. It is essential for the Town to manage water resources effectively to ensure the needs of both current and future residents are sustainably met over the long term.

What did residents say about water use and conservation?
Through a series of surveys, meetings, and engaging online discussions, residents prioritized the following:

• Maintaining Oro Valley’s water availability and planning for long-term sustainability
• Increasing community resources for water conservation
• Expanding water conservation programs
• Efficient use of all water resources (drinking and reclaimed water)

How are resident voices reflected in the community’s next 10-year action plan?
The draft plan reflects the voices of residents, establishing goals, policies, and actions to guide Oro Valley into the future.

Here are just some ways the residents’ Plan will guide future water use:

- Promote and increase efficient water use
- Increase awareness and education about water use and conservation
- Ensure the long-term water resource supply, sustainability, quality, and groundwater conservation for present and future Water Utility customers

Your voice is needed!
It’s time to ensure the draft plan captures the true values and priorities of our residents. We invite you to read through the details and share your thoughts about the water goals, policies, and actions by October 31, 2025. Visit OVPathForward.com/water today.

Want to learn more about water resources and conservation?
You are invited to attend the Community Academy’s first ever “Water Week” on October 28 and 30. These new classes will be held in Council Chambers from 6–8 PM and may be attended in person or online. Click here for more information and to sign up.

• Tuesday, October 28: Water Resource Planning – Discover the various water resources in the Town's portfolio and learn how they are used and managed.
• Thursday, October 30: Water Conservation at Home – Learn different methods to minimize water waste in your home.

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Bits and Pieces

Council approves plan to recruit new Town Attorney

Wednesday night's meeting, the Oro Valley Town Council approved the process for recruiting a new in-house Town Attorney. Human Resources Director Andy Votava outlined a plan modeled after the one used earlier this year to hire the Town Magistrate — posting the position quickly, advertising statewide, and having Council make the final hiring decision. Council members agreed the process should move forward without delay, citing the recent retirements of Legal Services Director Tobin Sidles and Chief Civil Deputy Joe Andrews. Staff was instructed to post the position immediately and return to Council with progress updates as the search advances. (See our previous report on this form more information)

Council approves Parks and Recreation fee increases; begins process to increase stormwater rate 

At Wednesday night’s meeting, the Oro Valley Town Council approved an update to the Parks and Recreation fee schedule and authorized a Notice of Intent to consider future changes to the stormwater utility base rate. The Parks and Recreation action updates fees for facility rentals, programs, and memberships beginning in January 2026. The stormwater item does not raise rates now but begins the required public process to review a possible increase from the current $4.50 monthly fee per household. The Council will hold a public hearing on January 14, 2026, before deciding whether to adopt the proposed stormwater rate changes.

Northbound lane closures on Oracle Road begin Monday 

The Town of Oro Valley’s Street Operations team will close portions of the northbound inside lane on Oracle Road from just south of Suffolk Drive to north of Big Wash Overlook Place between 9 a.m. and 1 p.m. daily, Oct. 20–24, with possible extension through Oct. 29. Crews will perform biannual median maintenance, including tree trimming, weed control, and trash removal. Traffic control and signage will guide motorists, and all lanes will reopen outside work hours. The Town maintains the medians under a longstanding agreement with the Arizona Department of Transportation. (Source: Town of Oro Valley Media Release)

Oro Valley's “mystery water line” project on State Lands

At Wednesday's Oro Valley Town Council meeting, Dan Scott, who lives in the Tortolita neighborhood just outside town limits near Tangerine and Thornydale, told the Council that heavy construction equipment had damaged his property from workers claimed to be installing a water line for Oro Valley. The water line is going into the state lands that were later discussed in the meeting. Scott said crews from contractor K.E.&G. entered the area about two weeks earlier, blading a wide path across State Trust land between Thornydale and Shannon Road and removing vegetation without any prior notice to nearby residents. He said neither he nor his neighbors had been informed of the project and asked the Town to explain what was happening. After his comments, no clarification was provided about the purpose or authorization of the work. However, we did see town Water Director Peter Abraham quickly moving to talk to Scott. Wonder what he said? We suspect that the water line is part of the NWRRDS project.  More to follow....

The no parking signs are mostly up

In early September we reported that the Town Council established no-street-parking zones on two major streets where the Oro Valley Church of the Nazarene is located. This week, we noticed that “No Parking” signs have been installed along Concordia and the southern portion of Buena Vista. Signs have not yet been placed on Buena Vista north of Concordia. The signs are small—but there are many of them [see panel right]. If you are a member of OVCN, please park in the church parking lot. We’ve been told there is sufficient parking for all parishioners, with overflow parking available at CDO. Street parking during church hours has been a long-standing concern for nearby residents. We don’t yet know when the remaining signs will be installed.

Chamber uses Gen-Zers to push for more apartments in Oro Valley

The push for higher-density housing seems to have become a mission for the Oro Valley Chamber of Commerce. Earlier this year, the Chamber’s Gen Z Committee met with young professionals who concluded that the Town’s housing policies make it difficult for them to live where they work. The group sent letters to Town officials urging more apartments, townhomes, and mixed-use developments, and their views were featured in an article titled “Gen Z Seeks Housing Focus.”  Wednesday night, several supporters, one who works for the Chamber and leader of the Gen Z group, appeared before the Town Council again, repeating those same arguments and asking that Oro Valley’s draft general plan be changed to remove what they called “bias” against apartments and high-density housing. 

Town accepts Sierra Wash easement but avoids responsibility for broader maintenance

The Town Council approved an easement from the Canada Ridge Homeowners Association allowing the Town to access and maintain recently constructed drainage improvements at the Sierra Wash crossing under Naranja Drive. Staff said the action was necessary to protect the public roadway and underground utilities from erosion caused by storm runoff. Town officials made clear that the Town’s maintenance obligations apply only to the newly installed protective armoring around the culvert—not to the natural wash itself. Several council members noted that other HOAs must continue maintaining their own washes and that the Town would not assume those responsibilities unless a wash directly affects public infrastructure. (Source: The Oro Valley Town Council Meeting, October 15, 2025)

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Transparency, Design Standards, and Timing Dominate Discussion of State-Mandated Changes to Routine Development Approval

Town working through challenges presented by HB 2447

Oro Valley Planning and Zoning staff is working to implement HB 2447. As previously reported, that bill requires that most non-discretionary development and design review applications—those that already meet Town code—be approved administratively rather than through public hearings before the Planning and Zoning Commission or Town Council. Staff and the Town face a number of challenges in implementing the provisions of the bill. They discussed these challenges with the Council during an October 1 study session.

January 1 date for compliance
The most immediate challenge is time. HB 2447 takes effect on January 1, 2026, leaving Oro Valley only a few months to bring its zoning code into compliance. Planning Manager Michael Spaeth told the Council that “this has a deadline of December 31 of this year, so it goes into effect January 1.”

Need to create precise, objective design standards
Spaeth said the Town must rewrite its design standards so that they are specific enough to support administrative approvals without the benefit of public hearings. “With those being administrative reviews now, it kind of ups the game in terms of wanting to make sure those design standards are more precise and really reflect what the Town is after at the end of the day,” he told the Council. The Town intends to create these design standards early next year as part of a Strategic Plan initiative.

Need to specify the appeal process
Staff must also sort out how appeals of administrative decisions will be handled. HB 2447 requires an appeal process, but existing code routes some appeals to the Town Council and others to the Board of Adjustment. Spaeth explained that “literally any decision the Planning and Zoning Administrator makes is an administrative decision under the eyes of code and state law,” and recommended consolidating all such appeals under the Board of Adjustment to avoid confusion and ensure consistency. Councilmember Robb questioned which types of appeals would shift away from Council, saying members should understand “what we’re giving up control of.” Spaeth replied that public art and certain architectural applications currently appealed to Council would now fall under the Board’s authority.

Need to examine the purpose of the town's "Economic Expansion Zone"
Another issue is what to do with the Town’s Economic Expansion Zone (EEZ). The EEZ covers parts of Innovation Park and other designated parcels that were created years ago to encourage business development by allowing faster, staff-level approval of qualifying projects without requiring Council review. Spaeth said that with HB 2447 in place, “that kind of makes a lot of Economic Expansion Zone moot… because now all entitled applications are eligible for administrative review.” Some EEZ features, such as allowing pre-grading to encourage investment, may remain, but most of the zone’s original purpose will disappear.

Must create procedures for expedited and “at-risk” reviews
The new law also requires towns to allow expedited processing and “at-risk” submittals. Spaeth explained that this means applicants can file grading and drainage plans earlier “with the aim of trying to expedite that review process” and that “all applications have to be afforded that opportunity” to request an expedited review and pay the related fee. Developing procedures and fee schedules for these options will take additional staff work.

Town tradition requires maintaining transparency and public confidence
Although HB 2447 eliminates the requirement for public hearings on projects that meet Town code, both staff and Council recognize that residents and Council members will still want visibility into those developments. Once the law takes effect, most site-plan and design approvals will occur outside public hearings, so the Town must find ways to keep the process transparent—such as posting applications or summaries online—and rely on clear, objective standards and accessible appeal procedures. The goal will be to preserve public trust even as the formal avenues for public and Council input are reduced.

Residents will have the opportunity to opine
Town staff will present the proposed zoning code amendments to the Planning and Zoning Commission in November and then to the Town Council in December for formal consideration. If approved, the changes will take effect before the January 1, 2026 deadline set by state law. As Oro Valley transitions to this new system, residents can expect staff to focus on refining design standards, clarifying the appeals process, and ensuring that development reviews—though now administrative—remain transparent and consistent with the Town’s character.

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Read our previous reports on HB 2447 to learn more,

Council To Move Quickly To Hire In-House Town Attorney

Council to review plan for hiring Town Attorney
Two weeks ago, the Oro Valley Town Council voted to have the Town Attorney report directly to them rather than to the Town Manager, even though the Town currently has no in-house attorney. Tomorrow night, the Council will take the next step by reviewing a proposed recruitment plan, job description, and timeline for hiring a Town Attorney. Human Resources Director Andy Votava will present the materials the Council requested when it approved the reporting change. His proposed approach is modeled after the process used when the Town hired a new magistrate in 2019.

Goal is to have position filled by February
The proposed timeline is designed to move quickly. The position will be posted on October 17, with applications due November 9. Council will review applications the following week, conduct virtual interviews in early December, and hold finalist interviews later that month. A conditional offer is planned for January 2026, with the goal of having the new Town Attorney in place by February.

There is a need to move quickly

The Town is moving quickly to fill this position following the retirements of Legal Services Director Tobin Sidles, who also served as prosecutor, and Chief Civil Deputy Joe Andrews, the Town’s civil attorney. With an active caseload and ongoing legal matters, filling these key vacancies is a priority.

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Dual roles need to be clarified 

The Town currently retains outside legal counsel for Council meetings and other legal services as needed. That arrangement remains in place as the Town begins recruiting for a full-time, in-house Town Attorney. The job description for the new position assigns the same advisory role—counsel to the Council—but the recruitment materials do not explain how the two positions will relate once the new attorney is hired. It is unclear whether the outside counsel will continue in some capacity, report to the new Town Attorney, or be replaced by the in-house counsel The town paid $51,950 to Mesch, Clark, Rothschild, in calendar 2024 The Council will need to clarify that relationship to prevent overlapping authority and ensure the Town has a single, consistent source of legal guidance.

A broad professional search
Recruitment will extend well beyond Oro Valley. The position will be advertised through the State Bar of Arizona, the Arizona League of Cities and Towns, the law schools at the University of Arizona and Arizona State University, the Arizona Women Lawyers Association, and several national outlets including ICMA, SHRM, LinkedIn, and Indeed. This broad outreach is intended to attract a strong, diverse candidate pool.

The town attorney needs to be both an attorney and a manager
As the Town’s chief legal officer, the Town Attorney will also serve as Legal Services Director. In that role, the attorney will manage both the civil and criminal (prosecution) divisions of the Legal Services Department and oversee all legal actions involving the Town. The position therefore requires both legal and management expertise. According to the job description, candidates must hold a Juris Doctorate from an accredited law school, a license to practice law in Arizona, at least seven years of legal experience including municipal or public sector work, and five years of supervisory experience.

Position is already budgeted
According to staff, the Town Attorney position and recruitment costs are already covered under the current fiscal year’s budget. No additional funding is required.

What’s next
If the Council approves the recruitment plan on Wednesday, advertising will begin immediately. Applications will remain open through early November, and interviews will take place in December. This meeting marks the start of the Council’s first direct hiring of a Town Attorney under its new structure.

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