Oro Valley Council's Focus Rezoning of Town Centre Land Is A Future Money Maker

Council initiates new zoning process for Town Centre land
The Oro Valley Town Council voted last week to initiate a general plan amendment to land that the town owns on Oracle Rd. The land is adjacent to and south of Town Centre. It is on the east side of Oracle Road where Pusch View Lane ends. The amendment would set new limits on building heights, reduce the scope of residential development, expand open space and recreation uses, and allow for additional commercial frontage along Oracle Road. The amendment affects areas designated as 3 and 4.

Barrett sought to protect views and preserve commercial use
Vice Mayor Melanie Barrett requested the Council take up this item. She noted that the existing zoning for the property still allowed a 75-foot hotel, which she believed would be out of scale with the area and could affect mountain views. She also expressed concern that removing the current ground-floor commercial requirement might result in Area 3 being developed entirely as residential, contrary to the Town’s past strategic vision of encouraging commercial activity along Oracle Road.

Adds commercial frontage along Oracle Road
As part of the amendment, the Council directed staff to create new commercial areas along Oracle Road. Labeled as Areas 5 and 6, these sites are immediately south of Area 2. That area includes retailers like CVS and Jersey Mikes. The intent is to extend the existing commercial frontage, taking advantage of the visibility and access along Oracle. Councilmembers viewed this as an opportunity to strengthen the Town’s commercial base while leaving the larger back portions of the property for open space and recreation.

Amendment addresses resident concerns voiced in 2019
The land has seen rezoning in the past. In 2019, the Council approved a rezoning of Area 4 to allow for 77 single-story homes on small lots with strict height limits and large areas of open space. The 2019 rezoning created quite a bit of community reaction where concerns were voiced about the loss of open views, increased traffic, and the scale of new development at the base of the mountains. Nonetheless, the rezoning was approved. According to Barrett speaking at that time, she favored limiting heights and preserving views in order to protect the scenic quality of Oro Valley’s mountain backdrop.

Town acquired this land as a gift, after failed Richmond American project
The Town came to own Areas 3 and 4 in 2020, when the Rooney family donated the property following a failed effort to develop it. Richmond American Homes had received approval in 2019 but found that the costs of extensive grading and large retaining walls made the project financially unworkable. After that collapse, the family transferred the land to the Town, leaving it to Council to determine the long-term future of the site.

Town could sell some of this land, generating millions for general fund
Mayor Joe Winfield commented during the discussion that the Town could “sell the property, let developers do their job,” and then use the proceeds to support the Town’s general fund. The Town has authority to sell property it owns without voter approval so long as it is not restricted for a public purpose and the sale is approved by Council.

Assuming that Area 4 is rezoned largely for open space and recreation, the amount of land the Town could sell is reduced to the Area 3 and the new Area 5. Together, these areas total roughly 20 to 30 acres with direct frontage on Oracle Road. Comparable sales along Oracle Road suggest commercial frontage can bring $400,000 to $600,000 per acre, while interior mixed-use parcels trade for $150,000 to $300,000 per acre. Based on those figures, the value of the marketable land falls to an estimated $15 million to $20 million, with the balance of Area 4 providing community benefit as open space rather than direct revenue.

From initiation to community review
The Council’s action only begins the rezoning process. Next, Town staff will hold neighborhood meetings to gather community input. The proposal will then move to the Planning and Zoning Commission for a public hearing and recommendation. A final decision rests with the Town Council, which will consider the plan again after these reviews and before any future development or possible sale of the property.

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Bits and Pieces

Town partially funds purchase of police facility through release of some general fund reserves

Wednesday, The Oro Valley Town Council unanimously approved the release of some of Oro Valley's General Fund Reserves to pay for the purchase of the new Oracle Road police facility.  The resolution returns brings the reserve from 30% to 25%. Both of these levels are above the historical 20% reserve level under prior administrations. This release amounts to about $2.4 million this year. That amount, by resolution, will be applied to the $3.8 million cost of the building being purchases.

Grants fuel town projects

Grants continue to play a major role in funding projects across Oro Valley. According to the September Town Manager’s report, the Town has recently secured or is awaiting decisions on more than two dozen grants. Awards include $144,500 from Arizona State Parks for accessibility improvements at the Vistoso Trails Nature Preserve, $25,988 from Arizona Game and Fish for the Naranja Park Archery Range, and over $3 million for the Northwest Recharge, Recovery and Delivery System. Other applications are pending, such as $86,490 from the U.S. Department of Justice for police programs and $80,300 from the Tohono O’odham Nation for interpretive signage at Vistoso. In total, more than $4 million in requests remain under review, highlighting the importance of pending grants in supporting future projects. (Source Town Manager Executive Report To Council, September 2025)

Group formed to advocate for Oro Valley Performing Arts Center

At Wednesday night’s council meeting, Oro Valley resident Tony D’Angelo updated the council on efforts to bring a performing arts center to Oro Valley. He noted that community surveys for the OVPathForward general plan show strong interest, and a recent tourism stakeholder session ranked a performing arts center as its top “big idea.” D’Angelo announced the formation of the Oro Valley Performing Arts Center (OVPAC) exploratory board, a new 501(c)(3) nonprofit with nine local leaders. One board member has already funded a full market and feasibility study by a nationally recognized consultant, which will take 14 weeks to complete. The study will examine financial viability, economic impact, and community benefits, with findings to be shared publicly as the effort advances. (Source: The Oro Valley Town Council Meeting, Call To Audience, September 17, 2025)

Pusch Ridge Tennis event space opens

The Town of Oro Valley celebrated the completion of a new event space at the Pusch Ridge Tennis Facility with a ribbon-cutting this month. The project, finished in just three months, added two large shade structures, concrete pads, bleachers, picnic benches, and artificial turf. Councilmember Elizabeth Robb called the improvements “an investment in Oro Valley’s strong tennis culture,” while Tennis Director Jennifer Fuchs noted the facility has long been central to community life. The space will serve both players and spectators and provide a venue for tournaments, gatherings, and special events (Town of Oro Valley Media Release)

Council will study new fees and taxes at October 1 study session... State of Town Addess on October 30

At Wednesday's council meeting, Town Manager Jeff Wilkins highlighted several upcoming activities and initiatives. The Community Academy begins October 2 with a nine-class series offering residents a look inside town operations. Council will review proposed new fees and taxes at an October 1 study session, followed by a public forum on October 15.  Wilkins also noted the State of the Town address on October 30, with a free business expo hosted by the Chamber of Commerce from 9–11 a.m. and a ticketed luncheon to follow. (Source Town Manager Report To Council, September 17, 2025)

Town Funds End Year Higher Than Planned — But Mostly Because of Delays

June 2025 Year-End Financial Results: How results compare to May estimates
Tonight, town staff will update the Oro Valley Town Council on financial results by fund for the year ended June 30. We provided a glimpse of what the year’s results would look like a few weeks ago. This was based on staff estimates from May results. Here’s that posting. Below is a look at what staff is expected to report tonight, and how it compares to what we wrote just a short time ago.

General Fund: Less use of reserves than planned 
Revenues ended the year just under plan at 99% of budget. Construction sales tax remained well below expectations, partly offset by restaurant, bar, and bed tax revenues and strong interest earnings. Expenditures came in under budget, so about $1.1 million of fund balance was used versus $4.1 million budgeted. The General Fund ended with a balance of approximately $21.0 million, about $6.4 million above the Town’s 30% policy reserve.

Compared to May: May’s estimate suggested a $2.3 million use of fund balance. Final results were stronger, with less drawn from reserves than anticipated.

Highway Fund: Project delays add to ending balance 
Highway revenues finished essentially on budget. Highway User Revenue Fund receipts and interest earnings were slightly short, but right-of-way permits and insurance recoveries offset the difference. Spending came in about 8% below budget due to the delay of the Shannon Road project. The fund closed with a balance of roughly $1.47 million.

Compared to May: The May projection was about $1.48 million. Actual results matched the estimate almost exactly.

Community Center Fund: Golf rounds and dues drove stronger revenues 
Revenues were stronger than planned, exceeding budget by about $1.4 million. Golf rounds reached 111,115 through June (up 8.2% year over year). Member dues and food and beverage sales were also higher. Expenses ran over budget, mainly due to labor, utilities, and credit card fees. Even so, the fund added about $1.1 million to its balance, finishing at roughly $2.98 million.

Compared to May: May projected a $750,000 addition and a $2.6 million ending balance. Actual results were about $400,000 better.

Capital Fund: Spending delayed, balance preserved 
Sources came in above budget by about $513,000, including a $1 million grant for the Naranja Park pump track and skatepark. Spending was well below the $10.3 million budget as several projects rolled into the next fiscal year. The Capital Fund ended with a balance near $16.8 million, slightly higher than its beginning balance of $16.7 million.

Compared to May: May projected an $11.7 million ending balance. Actual results were much stronger, reflecting added grant revenue and delayed project spending.

Water Utility Fund:  Surplus smaller than expected 
Revenues beat budget by roughly $957,000, helped by water sales, service charges, interest earnings, and an unbudgeted Water Infrastructure Finance Authority (WIFA) grant. Expenses were about 10% below budget due to vacancies, lower CAP water charges, and reduced system maintenance. Even with savings, transfers out and debt service brought the year-end balance to about $7.3 million.

Compared to May: May projected an ending balance of $15.5 million. June actuals came in lower, reflecting higher transfers and project spending than anticipated in May.

Stormwater Fund: FEMA Grant received, project costs lower 
Revenues finished slightly above plan, including a $210,000 FEMA grant for the Sierra Wash project. Spending was well under budget: the Oro Valley Drive drainage project was delayed, and Sierra Wash is estimated at about $380,000 versus $735,000 budgeted. The fund ended with a balance near $1.28 million.

Compared to May: May projected about $1.3 million. Actual results closed lower because more spending was recognized by year-end than had been expected in May.

Overall: Delayed spending increased fund balances over plan
Overall, the Town’s six major funds ended the fiscal year with balances stronger than budgeted, though not all matched the May estimates. The differences reflect timing more than performance. Revenues in several areas—especially construction sales tax—came in below plan. But less-than-planned spending—often due to project delays or vacancies—left more money on the books at year-end. This does not signal greater efficiency or fiscal restraint. It reflects cash-basis accounting, where work may be completed and payment made in the following year.
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May 2025 Financial Update: Larger than budgeted fund balances expected at year end

Bottom Line: Larger than budgeted fund balances expected at year end

All six of the Town’s major funds are estimates to end the fiscal year with balances greater than budgeted. This conclusion is based on a staff presentation to the town's Budget and Finance Commission

in August. The estimates are based on fund balance positions as of May.   

Delayed spending and savings drives most reported results

A larger than planned fund ending fund balance does not mean the Town is operating more efficiently or being more fiscally responsible. This is because the cash balances also reflect the timing of receiving and paying funds. Because the Town uses cash basis accounting, lower spending may simply mean that a project or service has been completed but payment has not yet been made; or that work has not yet started. For example, some capital projects in the Capital Fund have rolled into the next fiscal year, and certain road preservation projects in the Highway Fund and equipment purchases in the Water Utility Fund are being delayed.

General Fund: Lower revenues and expenditures

The General Fund pays for most day-to-day Town operations, excluding spending by the Water Department and the Stormwater Utility Fund. It also provides to other  funds, such as the Capital Fund and the Community Center Fund. Its performance therefore matters. General Fund revenues are down about 4% year over year, driven mainly by lower-than-expected construction sales tax revenues. This is despite licenses and permits exceeding the annual budget, with 106 single-family permits issued through May. Expenditures are tracking under budget due to unfilled positions and operations and maintenance savings. The Town now expects to use about $2.3 million of fund balance instead of the planned $4.1 million, leaving reserves about $4.4 million above the 30% Council policy threshold.

Highway Fund: Delayed road projects boost fund balance
Revenues in the Highway Fund are at 83% of budget. Highway User Revenue Fund receipts are slightly below plan, but higher right-of-way permit fees and insurance recoveries help offset that shortfall. The fund also receives quarterly transfers from the Capital Fund, totaling $4 million for the year. On the spending side, savings are expected in personnel, street and traffic signal maintenance, and several capital projects. Equipment and road work came in under budget, including the Magee Road and La Cañada Drive mill and overlay projects. The Town Council also shifted funds from a planned truck purchase to a less expensive crack seal machine, producing additional savings. Instead of a $365,000 change in fund balance as budgeted, the fund is now projected to add about $870,000 by year-end. 

Community Center Fund: Better than planned revenues balanced, somewhat, by greater than planned spending
Revenues in the Community Center Fund are ahead of budget, reaching 105%. Golf activity is strong, with 111,115 rounds played through May, an increase of 8.2% from last year. Town revenues from dues, recreation programs, and rentals are also higher than expected. Expenses are running over budget due to higher labor, utility, and credit card costs, as well as increased personnel costs. Even so, instead of using $115,000 from the Community Center Fund balance as planned, the fund is now projected to add about $750,000, ending the year with a balance of $2.6 million. These results include a transfer from the General Fund of $3.59 million, projected to reach $3.9 million by year-end (June). The Community Center Fund also transferred $1.72 million to cover debt service on the $25 million Parks and Recreation bond.”

Capital Fund: Rolling some projects into next year
Revenues in the Capital Fund are at 85% of budget through May. These include a $1 million state grant for the Naranja Park pump track and skatepark, $5.35 million in transfers from the General Fund, and higher-than-expected interest earnings. On the spending side, only $4.5 million of the $10.3 million budgeted for capital outlays has been used, as several projects will roll into the next fiscal year. Transfers out include funding for road work into the Highway Fund and $2.2 million set aside for the Vistoso Trails Nature Preserve and transit vehicles in the Grants Fund. Instead of using $5 million of fund balance as planned, the fund is now projected to use only about $400,000, leaving an ending balance of $11.7 million. 

Water Utility Funds: Increases revenue...some cost savings
Revenues in the Water Utility Fund are expected to slightly exceed budget, helped by reclaimed water sales, service fees, and higher interest earnings. Loan proceeds total about $7.2 million compared to $8 million budgeted. On the expense side, savings are coming from staff vacancies, lower costs for CAP water deliveries, and reduced system maintenance. Capital outlays are also running below plan. Debt service payments were made as scheduled, and transfers are being used to fund regional water projects such as the Northwest Recharge, Recovery, and Delivery System. Instead of the $2.3 million increase that was budgeted, the fund is now projected to grow by about $6.2 million, ending the year with a balance of $15.5 million.

Stormwater Utility Fund: Spending timing impacts fund balance
Revenues in the Stormwater Utility Fund are on track, with fee collections near budget and interest earnings well above expectations. A FEMA grant for $210,000 for the Sierra Wash project will roll into the next fiscal year. On the expense side, savings are coming from vacancies and lower costs for vehicle and equipment repairs, field supplies, and gasoline. The Sierra Wash project had a budget of $735,000 but is now estimated to cost about $380,000 by year-end . Instead of using $432,000 of fund balance as budgeted, the fund is expected to use only about $127,000, ending the year with a balance of $936,000.

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Council To Consider Folding Community Center Sales Tax Into General Fund In August

Tax no longer need to support municipal golf and the community center
The Oro Valley Town Council will consider folding the one-half percent Community Center sales tax into the town's General Fund when it returns from summer holiday in August. This will make the funds available for any use; not just use for the community fund or other recreational assets. This tax was enacted ten years ago by a 4-3 council vote when the town acquired the 47-hole El Conquistador Golf facility from HSL Properties. The reason for the tax was to provide a stable, dedicated funding source to support the newly acquired community center and golf operations, which were expected to run at a deficit in the early years. The expectation was that the tax would not be needed after that time.  But, as we all know, a tax, once enacted never goes away, 

Mayor’s proposal: Move the tax to the general fund
At last week’s Council meeting, Mayor Winfield proposed folding the tax into the general fund for several reasons:

• The dedicated sales tax has stabilized the finances of the community center and golf operations, which are now performing better and require less support.
• Moving the tax revenue to the general fund allows the Council to allocate funds to the town’s most pressing needs—including public safety, roads, parks, infrastructure, and community services—rather than limiting it to the community center and golf.
• The current arrangement is perceived as benefiting a narrow interest group.  Yet the tax is collected from all residents and visitors. Integrating it into the general fund “reinforces unity and fairness” and reflects a shift to shared community investment.
• This change would increase fiscal flexibility as Oro Valley nears build-out and construction-related revenues decline, positioning the town for long-term financial health.

Council reactions: Range of opinions, but no support for status quo
Council members expressed support for doing something different with the tax revenues. None supported leaving it as a dedicated source for the community center only: 

• Vice Mayor Barrett supported the Mayor’s proposal:  “I am so pleased with how well golf is doing. For the second year in a row we have not relied on any of the tax money, and that’s what it was basically set up to do ten years ago. ” 
• Council Member Murphy floated the idea of dedicating the tax for all parks and recreation programs. 
• Council Member Greene seemed cautious about making a change:  “I think if we go back historically, this money was designated for the community center and for golf and I think that we need to keep that in mind as we begin to spend it on other issues as they come up. So, I’m for really having a full discussion on this and not acting precipitously on it tonight.”
• Council Member Jones-Ivey leaned toward the parks and recreation fund idea but expressed concern about transparency if the money goes to the general fund: “Sometimes when monies go into the general fund, it really in the past has kind of gotten mired so that transparency is lost. … My question would be: How would we then earmark that money going into the general fund so if something is needed in parks and rec, it can come back?”
• Council Member Robb summed up her support for a change stating, “I agree it’s time to share the wealth on this money.” 

August public hearing. ..Active community involvement
The August meeting will be a public hearing on the proposed change. The community center and golf supporters are expected to pack the hearing and advocate for keeping the tax dedicated to their operations. Historically, they have been successful in persuading the Council to continue support. It remains to be seen whether Mayor Winfield will stick to his position or compromise as he has done in the past when face was significant opposition. 

"Putting to bed" a "bone of contention”

Golf and the community center have been a point of contention since former Mayor Hiremath first brought the acquisition to the council in 2014. The hope is that folding the sales tax into the general fund will help reduce this ongoing debate. 

No discussion of permanently sunsetting the tax
One thing the Council will not consider is ending (sunsetting) the community center sales tax. As it stands, this tax means Oro Valley’s sales tax rate is 2.5% is the highest in southern Arizona. This higher rate may contribute to residents and visitors shopping outside of Oro Valley for big-ticket items, as it is less expensive to shop elsewhere.

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Guest View: Mike Zinkin – “Abide by the policies set forth in the Town Code and Council Policies”

Below is the speech that Mike Zinkin addressed to the Town Council during the April 20th Call to the Audience.
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Mayor and Council,
It is time to take back control of this Town from the Town Manager and abide by the policies set forth in the Town Code and Council Policies.

I have communicated with you on more than one occasion that at the Council meeting of March 4, 2015, the Council passed a motion taking $2.1 million from the General Fund to “kick start the Community Center Fund (CCF).” The motion also stated that the CCF would pay back the General Fund within 10 years with an annual payback of $120,000.

I have noticed that the $120,000 payback was not made during this fiscal year. When I brought this to the attention of you and the Town Manager, the reply I received from the Town Manager was, “A prior Council’s actions cannot bind a current or future Council.”

One councilmember wrote the Town Manager and informed her that her response could not be verified.

Town Code Article 2 Section 4-7 states that the Town will abide by Robert's Rules of Order. Robert's Rules state that a motion can be modified in two ways. A motion to reconsider, or a motion to rescind.

A motion to reconsider must be made no later than the next scheduled meeting. Some of you have attempted to do this regarding another matter, but the Town Manager obstructed your attempt which was in violation of Council Policy #11.

A motion to rescind can be made at any time but requires 5 votes to pass. Unless you move to rescind the 2015 motion, you are obligated to continue the annual $120,000 payback to the General Fund from the CCF.

Additionally, the Town Manager has hired a CIP Director (Capital Improvements Project), which is a position that was not budgeted. Town Policy 6 mandates the Town Manager to come to you for any unbudgeted expenses. The Town Manager tells me that this is a temporary position and is funded by the CIP Fund. Temporary or not, it is unfunded. Using the CIP Fund is also a violation in that CIP funding is from one-time revenues and is to be spent on one-time expenses. An employee is an ongoing expense. This is another violation.

Page 226 of the FY 20/21 adopted budget allocates $105,000 during FY 21/22 for “Council Chamber Audiovisual upgrades.” In a recent communication with the staff, I was informed that the Council Chamber renovation cost $607,125.00 and was paid for with Federal CARES funding. I don’t care where the funding came from, what concerns me is that you did not authorize it. The Town Manager never came forward to request unbudgeted expenses, again in violation of Town Policy.

This must stop. You need to gather in the Town Manager and set some boundaries and reinforce the rules. At this point, you also have enough evidence to terminate her for cause. Do something, as you are ultimately responsible.

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Mike Zinkin and his wife have lived in Oro Valley since 1998. He 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. He was named a Fellow for the National League of Cities. He was a member of the NLC Steering Committee for Community and Economic Development and a member of the Arizona League of Cities Budget and Economic Development Committee. He was an Air Traffic Controller for 30 years. Mike 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.

Oro Valley Weathers The Financial Storm.... So Far

Council discusses 2020 year end results tonight

Tonight, town council will hear the unaudited financial results of three of the towns funds for the year ended 2020: The General Fund, the community center fund and the Highway Fund. Results have been uncertain because of the unknown financial impact of the pandemic.  It appears the town has weathered the storm.

General Fund Balance Increased to $21.4 million

The general fund pays for all of the town's administrative functions and the police department. It is the fund that would be most impacted by the pandemic since sales tax collections are about half of total general fund revenues.  Year end balance is expected to increase by $1.8 million from the beginning of the year to $21.4 million.

(Click image to enlarge)

General Fund revenues 6% over budget

The town took measures early in March to slow spending and freeze hiring. The objective was to 
"hunker down" and be prepared for the worst. That game plan worked through the end of the year. The total estimated year end was 6% over budget, totaling $41.7 million.  Local sales tax revenues and interest income exceeded budget by $2.5 million. Inter-government funds and charges for services were $800,000 under budget.

General Fund spending 5% under budget

Total General Fund spending was $39.9 million. This was $2.1 (5%) million under budget. Spending in all departments except for legal were under budget. The Police and the Parks and Recreation Departments spent $1.2 million less than budget.

Community Center essentially on budget

Community Center revenue was $175,000 less than budget. Spending was $285,000 less than plan. The center received sales tax subsidy of $2.9 million. This amount is far more than the $750,000 sales tax subsidy target that was set by the town council last November. That subsidy level is to be achieved by 2023.  Golf revenues and membership fees were 9% over budget. Most other revenue sources were under budget because the Community Center has been closed since March.

Highway Fund slightly over budget
"In the Highway Fund, total actual revenues for the year came in over budget by approximately $272,000 or 7.2%. Expenditures for the year were under budget by roughly $12,000 or 0.3%. Overall, the Highway Fund ended the year with a decrease in fund balance of $53,343 (note that the planned budgeted decrease in fund balance was $337,241) (source)

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Guest View: Mike Zinkin ~ More General Fund money for the “Turn-Key” operation

The budget for FY 2020/21 has passed and the stench of the Hiremath regime still permeates the air. The Chamber of Commerce still gets $40,000, Sun Corridor still gets $10,000, Visit Tucson still gets over $200,000, there is $10,000 for employee service awards (an average of $300/employee), the Children’s Museum still gets $75,000, and there is over $2.9 million for outside services. All this in a period when our revenue stream is uncertain due to the pandemic.

Pay-as-you-go?
There is $1.1 million budgeted for golf course irrigation improvements. Awhile back, the Council voted that all improvements to the golf courses would proceed on a “pay as you go” model. We have over 5 years of history on the performance of the Community Center Fund (CCF) and it has never had a positive balance of $1 million. In fact, according to page 6 of the Town Manager’s Recommended Budget, the CCF is forecasted to end the 2021 budget with a deficit of $214,212.

The approved budget also allows for $750,000 to be spent toward ADA compliance of the Community Center. (ADA upgrades were supposed to have been completed by FY 2018/19 according to the rosy projections and promises of the Hiremath council.  See below.) 

From the Town's December 2014 Power Point Presentation

I asked the Town where all this money was coming from. The Town confirmed to me that the $1.1 million for the irrigation project was coming from the CCF. But can we be confident that the Town Manager will respect the Council wishes of pay-as-you-go and not spend the $1.1 million unless and until the CCF has the money as a positive balance? Are you confident that this will happen?

A Capital Fund Smokescreen
When I inquired where the funding was coming from for the $750,000 to correct ADA issues, the Town replied that it was coming from the Capital Fund. I believed this response to be a smokescreen so I continued the conversation and inquired, “What is the difference between the Capital Fund and the General Fund?” The Town responded: “Generally speaking, in most instances projects budgeted in the Capital Fund can be assumed to be funded with General Fund resources. Exceptions would be projects that have associated grant or intergovernmental funding or outside contributions associated with them.”

$3.3 million in General Fund withdrawals for a “turn-key” operation
Remember, we have already withdrawn $1 million from the General Fund in 2014 to purchase the property, another $1.2 million in 2015 to initiate the CCF, another $350,000 in 2017 to supplement the CCF, and now an additional $750,000 in 2020 for ADA upgrades for the Hiremath “turn-key” Community Center.. This adds up to $3.3 million in General Fund withdrawals for this purchase (of which only $360,000 has been returned back to the General Fund -- despite a promise from the Hiremath council to have paid back $600,000 by May 2020).

And don’t forget that between 2015-2020, you have also donated over $10 million of your sales tax dollars towards this “turn-key” operation.

And the Hiremath stench continues.

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Mike Zinkin and his wife have lived in Oro Valley since 1998. He 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. He was named a Fellow for the National League of Cities. He was a member of the NLC Steering Committee for Community and Economic Development and a member of the Arizona League of Cities Budget and Economic Development Committee. He was an Air Traffic Controller for 30 years. Mike 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.

Guest View: Mike Zinkin ~ Combining the Community Center Fund Into The General Fund Is A Bad Idea

Town Archives, June 2012
In June 2012, the Oro Valley Town Council approved a withdrawal from the General Fund of $524,000 to help pay for cost overrides at the Aquatic Center. This money was to be paid back with annual installments of $35,000 from the Bed Tax Fund.

Fast-forward to 2018. Town Manager, Mary Jacobs (with Council approval) combined the Bed Tax Fund into the General Fund. Doing this eliminated the accountability of staff to ensure that the annual $35,000 reimbursement commitment is completed.

Town Archives, March 2015
On March 4, 2015, the Town Council approved a sales tax increase with this increase dedicated to the new Community Center and Golf Fund. (The name was later changed to the Community Center Fund). The Council Report reads, “… staff recommends Council consideration and approval of a budget amendment to establish a new, separate fund to account for the operations of these facilities. This new fund, called the Community Center and Golf Fund, will account for all revenues and expenses generated by the operations of these facilities.”

Fast-forward to 2019. In the Town Manager’s Recommended Budget for FY 2019/20, Jacobs is proposing to abolish the CCF and combine it into the General Fund. Doing this will eliminate all accountability regarding the expenditures of the “dedicated” half-cent sales tax. It will eliminate the monthly report which shows the revenues and expenditures regarding the Golf/Community Center. The Council should not allow this. The CCF allows for transparency and shows us exactly what it going on.

Examples of why combining funds is a bad idea
Do you think we would have discovered that the Town pays nothing for utilities, the extent of the golf losses, the lease contracts, etc. if this was all combined within the General Fund? The CCF owes the General Fund $120,000 a year (for 10 years) to pay back the $1.2 million loan that was used to start the Community Center Fund in 2015. Will this payback happen if they are combined into one fund? How would we know?

Next up, combining the Highway Fund into the General Fund
Jacobs also wants to combine the Highway Fund into the General Fund. Will this allow for highway money to be spent for soccer fields? Keeping these funds separate makes staff accountable and allows for transparency in town spending. We can see where the revenues are generated and where the money is spent.

We are not like most cities
Jacobs tells us that this is the way most cities do business. Oro Valley is not like most cities. We desire to keep an eye on our money…where it comes from and where it goes. Combining these funds into the less restrictive General Fund would be a huge mistake.

Town’s Golf Investment priority continues to run “off course.”

Below are the financial statistics for the Community Center and Golf since its inception in May 2015 through the last available financials in November 2018 (four months into the fiscal year).

Purchase Price

Total - $1,000,000

Total transfers from the General Fund to the Community Center Fund (CCF)

FY 2014/15 $1.2 million to start the CCF Fund
FY 2016/17 $350,000

Total Transfers - $1,550,000

Total sales tax revenues from the dedicated sales tax increase to fund the CCF

FY 2014/15 - $506,710
FY 2015/16 - $2,030,750
FY 2016/17 - $2,199,466
FY 2017/18 - $2,330,941
FY 2018/19 - $906,463 (through Nov. 2018)

Total Sales Taxes - $7,974,330

Grand Total of tax dollars funneled to the Community Center/Golf = $10,524,330.

That’s $10 million dollars of the people’s money and the Community Center is still not ADA compliant. This is your money that could have built a new, state-of-the-art Community Center. In addition, the sales tax increase could have been repealed after the new Community Center was built.

Total Troon losses – Forecasted vs. Actual

FY 2014/15 – Lost $1,112,252 (Opened for only two months)
FY 2015/16 - Forecasted - $1,518,343; Lost $2,567,385 -- (off by $1,049,042)
FY 2016/17 - Forecasted - $1,534,505: Lost $2,512,938 -- (off by $978,433)
FY 2017/18 - Forecasted - $1,822,941; Lost $1,993,040 -- (off by $170,099)
FY 2018/19 – Forecasted (see below); Lost $1,102,243 (through Nov. 2018)

In FY 2018/19, Troon initially forecasted losses to be $1,893,595. However, they updated their forecast to $1,936,101. We are only 4 months into the fiscal year, and they have already lost $1.1 million.

Total Troon losses - $9,287,858 and counting

Food and beverage losses (Overlook Restaurant)

FY 2014/15 – Unknown. (Opened for only two months)
FY 2015/16 - $255,570
FY 2016/17 - $114,792
FY 2017/18 - $96,100
FY 2018/19 - $62,325 (through Nov. 2018)

Total restaurant losses - $528,787

Member Dues

FY 2014/15 – $201,531
FY 2015/16 - $876,133
FY 2016/17 - $725,611
FY 2017/18 - $784,071
FY 2018/19 - $284,968 (through Nov. 2018)

Total dues - $2,872,314

The Town Council needs to ask staff the following questions:

• Why is the facility still not ADA compliant after almost four years of operations?
• Why are the citizens still subsidizing the Overlook Restaurant?
• Why is the staff still supporting the 45-hole golf model?
• Why is the staff still supporting a dedicated golf course for only 226 members?

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Editor's Note: We originally posted incorrect numbers for Troon losses in FY 17/18. We have corrected the information.

Guest View: Mike Zinkin ~ Oro Valley Government lies to the citizens

Those who saw the movie, "The Post" learned that the "Pentagon Papers" were a classified government document that showed that every presidential administration from Eisenhower to Nixon lied to the American people about what was going on with the Vietnam War. Although not of the same scope, something very similar is happening in Oro Valley.

Town Staff Controls the Message
When one attends the Newly Elected Training Session (for new councilmembers) presented by the Arizona League of Cities and Towns, one learns (among other things) about the Open Meeting Laws, how to work with the media, and that Town staff controls the message.

Governing boards, whether they be City Councils, School Boards, Boards of Supervisors, etc., are made up of ordinary people. They are not Planners or Civil Engineers or Public Safety experts. They are laymen that are interested in their communities and have a desire to help establish policies. As a result, they depend on the information provided to them by their staff.

Staff works for the Town Manager, who works for the majority of Council. During my four years as an Oro Valley Town Council Member, I was told on many occasions by former Town Manager, Greg Caton, that, "I do not work for any individual Councilmember, I work for the Council majority."

Why is this the case? Because if the Town Manager does not please the Council majority, the Town Manager will lose his/her job. As a result, the message that the Town Manager gives to the 7-member Town Council is manipulated to please the 4-member Council majority. It’s in the Town Manager’s best interest to tell them what they want to hear.

This happens all the time, but on December 17, 2014, the night the Council voted to purchase the HSL property (the Community Center plus Golf and Tennis), the staff controlled the message to show that the purchase was desirable for the Town because that’s what the mayor and his Majority-4 cohorts wanted to hear.

The Message was a Lie
Now that we have almost three years of financial data as evidence, we can see that the message was a lie.

The message was that all expenditures, including the needed capital improvements, would be covered by the dedicated increased sales tax plus the revenues derived from the facility and that no money would be taken out of any other Town funds to supplement Community Center/Golf expenses (other than for the initial transfer of $1.2 million from the General Fund to the Community Center Fund which would be paid back at $120,000 per year for 10 years.)

The Power Point presentation provided to the Council shows that in the area of capital improvements for both the facility and golf, they would spend the following:

$810,000 in FY 2014/15      (including $50,000 for golf improvements)
$1,860,500 in FY 2015/16   (including $1,310,500 for golf improvements)
$1,772,500 in FY 2016/17   (including $1,282,500 for golf improvements)
$596,000 in FY 2017/18      (including $130,000 for golf improvements)

And between 2015-2018, they were going to spend:

$1,037,000 for "ADA and Code Compliance Life Safety Issues"
$522,000 in "Facility Restoration"

These two slides show what they were planning to spend on golf improvements, ADA compliance, and facility restoration in each fiscal year. [Click to enlarge]

With this information, the Council majority (Mayor Hiremath, Vice Mayor Waters, Councilmembers Hornat and Snider) voted to purchase the property. However, it now appears that the staff lied in order to please the Majority-4 Councilmembers.

The Budget was a Lie

In fact, after the purchase was made, staff only budgeted the following:

$1,115,000 in FY 2015/16    (NOT the $1,860,500 that was promised)
$527,200 in FY 2016/17       (NOT the $1,772,500 that was promised)
$94,250 in FY 2017/18         (NOT the $596,000 that was promised)

How much did they actually spend?

The real story lies in what they promised vs. what they budgeted vs. what they spent.

In FY 2014/15, they spent only $37,873 of the $810,000 they promised. I’ll give them a pass on this due to the 2015 referendum which delayed the purchase until May 2015; however, the promised capital improvements were not carried over to the next fiscal year.

In FY 2015/16 the total capital outlay was only $499,744 of the $1,860,500 they promised.

In FY 2016/17 the actual capital outlay was only $72,414 of the $1,772,500 they promised.

Half-way into FY 2017/18, the capital outlay is only $29,464 which is a far cry from the $596,000 they promised.

The promise that no money would be taken from any other Town funds was a Lie
Remember that all this money was going to come from the sales tax increase and revenues from the golf and community center. There was not going to be any more money taken from the General Fund (other than the $1.2 million to start the Community Center Fund).

Here’s what actually happened. In June 2017, the Town Council voted to transfer an additional $350,000 from the General Fund to the Community Center Fund. Later in 2017, the staff took $21,323 from the Bed Tax fund (hotel room tax) to cover the overage from tennis court improvements.

Now the Town Manager and Council are discussing the potential of bonding (incurring a debt service) for the continued improvements required for the Community Center facility and Golf courses.

They lied. It’s clear that there was no way the needed capital improvements and the required Operations and Maintenance for the purchase would be covered by the sales tax increase. They didn't even budget for the promised improvements in the subsequent budgets. They promised there would be no debt service (bonding) but now they’re discussing bonding to pay for Community Center expenses. They lied.

You think this is bad? Part 2 will discuss Troon’s lies.

[Slides provided in this article are from the December 17, 2014 Power Point presentation]

Part 2 will be published on Thursday.

Guest View: Mike Zinkin ~ Surprise! The 5-year plan is now a 6-year plan.

The June 28, 2017 edition of the Explorer reported on the recent Council decision allowing another $350,000 transfer from the General Fund to the Community and Recreation Center Fund (CRC). Of note is that $120,000 of this money will be utilized to pay back the Council’s obligation to repay $120,000 per year back to the General Fund to refund the $1.2 million that they withdrew in 2015 to initiate the CRC Fund.

The Shell Game
So, in essence, the Council took another $350,000 from the General Fund in order to pay back $120,000 to the same fund. This is a prime example of a government shell game.

The article goes on to say that the reason the Council did not pay back the $120,000 last year was because of "poorer than expected performance.” We had poorer than expected performance again this year as well, which is why the only way they could make this year’s payment was to move some shells around.

Mayor Hiremath had no problem with the additional funds being withdrawn from the General Fund, despite asserting on multiple occasions that the CRC Fund (funded with the increased sales tax generating $2 million per year) would pay for all Community Center expenses (golf, tennis, swimming, food and beverage).

June 2017 ~ Hiremath changes his story

"I have stated publicly time and time again, that this is a six year process. It's like buying a fixer-upper house, we’re not going to break even within the first, second, third, fourth, or even fifth year. I think that the story here is that we are holding true.”

(Six years from the Community Center’s inception in May 2015 would take us to May 2021 before he expects to make a profit).

Au contraire
Since 2014, “Hiremath and Associates” have been telling us repeatedly that this is a 5-year plan. In fact, during the December 17, 2014 council meeting, the night that the Town Council voted to acquire the El Con property, Mayor Hiremath said:

“We’re telling you that in the first two years, we’re going to lose major money, but by Year-3 and Year-4…In year 4 and 5 and 6, are we going to project a profit? You’re darn right, we are.”

So in 2014, he clearly stated that they wouldn’t be losing money by years 3 and 4 and they expected a profit in years 4, 5, and 6. In 2017, seeing that we’re still losing money, he now admits that we’re not going to break even in the 4th or even the 5th year and he now wants us to believe that this has always been a 6-year plan.

The Majority-4 Battle Cry
LOVE readers will also remember the multitude of times in 2015-2016 that Councilmembers Zinkin, Garner, and Burns tried to discuss options for dealing with the dismal Community Center financials, only to be dismissed every time with the Majority-4 battle cry, “This is a 5-year plan.”

Pina-Rodman-Solomon never mentioned a 6-year plan
During the 2016 Town Council Election, then-challengers and current council members, Rhonda Pina, Bill Rodman, and Steve Solomon were also peddling the 5-year or less plan.

PINA: “I think the year that we’ve had (2015-2016) was a little volatile. Let’s give it another year and maybe another year after that.” (So Pina’s cut off point would be 3 years / 2018).

RODMAN: "Initially it was a 5-year plan and it wasn't intended to make money during that period of time, so all of this uproar about trying to make a decision now is probably premature."

SOLOMON: “For a project of this size, I would give it 5 years and I would really start giving it a close look in years 3, 4, and 5.”

How’s this for a close look?
Including all the revenues from the increased sales tax and the withdrawals from the General Fund, so far this investment has cost the Citizens of Oro Valley over $6.8 million. And what do we have to show for it? A 1980’s building that is still not ADA compliant, two golf courses closed for the summer, and a restaurant that is on track to lose another $100,000 this fiscal year (July 2016 through June 2017).

If Humberto Lopez believed that he had a money-maker in a run-down building and three golf courses, he never would have unloaded them on the Town.

Hiremath....you and your cohorts on Council were duped and the citizens of Oro Valley are paying the price.

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.

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?
………………………………

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

The Ides of March weren't good for Oro Valley either
Just like Julius Caesar had a bad month of March, so did the Oro Valley Golf and Community Center. The Community Center Fund (CRF) ended the month $346,907 in the red. At 75% through the fiscal year, the fund remains in the red, and the council still owes a $120,000 payment to the General Fund Contingency and $454,808 in promised capital improvements.

Troon-managed facilities (golf, food, beverage, non aquatic center swimming, and some tennis) lost $77,103 in March. They were forecasted only to lose $25,754. They missed their forecast by 33%. How does Troon manage to keep their job with their 2.5 year record of continually poor forecasting? Troon has lost $1,809,051 so far this fiscal year and we still have 25% of the fiscal year remaining. So far, they have upped their year-end forecasted losses from $1,534,505 to $2,038,334 to $2,092,218.

The Overlook Restaurant was forecasted to make $27,021, but lost $3,204. The food and beverage portion of Troon has lost $93,705 through March.

The dedicated Community and Recreation Center Fund is not covering expenses
The CRF fund was suppose to provide ALL the revenues for capital improvements, yet the FY 17/18 budget shows $75,000 coming from the Bed Tax Fund for tennis court improvements, another $75,000 coming from the Water Utility Fund for a water main replacement at the Community Center, and only $50,000 actually coming from the CRF for cart path improvements. In other words, of the $200,000 being spent on Community Center capital improvements, only $50,000 (or 25%) is actually being provided by the "special Community Center fund.”

Solomon’s Fuzzy Math
During the April 19th council meeting, Councilmember Solomon bragged that “7,000 rounds of golf were played” in March. Of course, he didn’t mention that 2,046 of those were member rounds. This is important to note because members do not pay per round, they pay a monthly fee and that fee does not change whether they play one round or 100 rounds. Solomon also neglected to mention that 602 of the 7,000 rounds were complimentary rounds or that golf memberships had increased by just one, from 238 to 239. This is a far cry from the 318 memberships that Troon desired to have by December 2016.

Solomon Speaks with Forked Tongue
Councilmember Solomon also mistakenly crowed during the April 19th council meeting that:

“…the Golf and Community Center revenues and dedicated half cent sales tax for this year will cover all of its costs. It’s not using any other town funds. It’s not taking money from any other town project or town source.”

Of course, none of that was true. Interestingly, after claiming that the dedicated Community Center fund was covering all of the costs, just one week later, during the April 26th budget study session, it was none other than Councilmember Solomon who suggested taking additional monies from the General Fund Contingency to do some upgrades to the Community Center. Councilmember Rodman agreed.

This is a complete turnaround from what they asserted while campaigning – that we didn’t need to worry about Community Center expenses because there was a special fund set aside for those expenses. Additionally, it has always been the Town's philosophy that one time expenses should be paid for with one time revenues. Dipping into the General Fund would certainly be a departure from this philosophy.

A novel idea - Represent your constituents
If Councilmembers Solomon and Rodman desire to spend General Fund Contingency monies, why don't they spend them on Naranja Park? That way their constituents will get something they desire. They NEVER desired a golf course, more swimming pools, or a restaurant. What their constituents desired is spelled out in the June 2014 statistically valid survey.

Councilmember Rodman is a member of the Gallery Golf Club – a club that fired Troon. Oro Valley residents should ponder this question: If Troon was not managing Councilmember Rodman's money responsibly, why does he allow them to mismanage your money?

Et tu Hiremath, et al.