MUNICIPALITIES: 'GETTING BETTER, BUT STILL A STRUGGLE'

posted by Michael Chihak

Representatives of the state's cities and towns are worried about what comes next in the struggle to keep their budgets balanced.

That's after a two-year stretch in which they cut local budgets by an average of 30 percent, including layoffs of hundreds of municipal workers, elimination or consolidation of services and delays in ongoing projects.

"Things are slowly getting better, but it's still a struggle," Ken Strobeck said. He is executive director of the League of Arizona Cities and Towns, which represents all 91 municipalities in the state.

Strobeck and Avondale Mayor Marie Lopez Rogers, who is an officer in the state league and in the National League of Cities, discussed their fiscal issues in an interview in Avondale today.

Rogers said in Avondale, the budget went through the same 30 percent cut that most others saw, and yet there remains a $4 million deficit for the next fiscal year. Other municipalities are in similar straits.

She and Strobeck said they are worried about what will happen if the state does not get a waiver on its Medicaid payments, something that would toss a $542 million budget deficiency back into the laps of the governor and the Legislature.

Gov. Jan Brewer said the waiver request to the federal government this week, and there is no word on when a decision will be made. She and legislative leaders say it is absolutely necessary to balance the state's budget.

But it is not a sure thing, with many states facing similar budget-balancing scenarios and the same mandates from the federal government to provide services such as health care for the poor.

If the state doesn't get the waiver, Strobeck and Rogers said, they fear that everything will be on the table for cutting. That would include $800 million that the state now collects in revenues from income taxes, sales taxes and fees to be passed along to the cities and towns.

The complete interview with Rogers and Strobeck will be posted on this site later this week, and the Arizona Week broadcast of excerpts, plus journalists' commentary and analysis, will be available on the site Friday and on KUAT-TV 6 at 8:30 p.m. MST Friday.

QUESTIONS FOR STATE MUNICIPALITIES ABOUT THEIR FINANCES

posted by Michael Chihak

Friday's edition of Arizona Week on KUAT-TV, Channel 6, will focus on how Arizona's cities and towns are doing financially in the face of slow recovery from the recession.

Up for interviews are Avondale Mayor Marie Lopez Rogers, whose city of nearly 80,000 residents is a western suburb of Phoenix, and Ken Strobeck, who is executive director of the League of Arizona Cities and Towns, based in Phoenix and representing the state's 91 incorporated municipalities.

Among questions for Rogers and Strobeck:

• Please give an update on how the state's municipalities are doing financially.

• Have cities and towns gone through their rainy day funds the way the state did, or do they have something in reserve?

• The state passes along to the cities and towns about $800 million a year in income tax, sales tax and other tax and fee revenues. Do you expect that to continue in the coming fiscal year?

• Cities and towns are, in fact, are in line for some cuts, a little under $20 million total, from the state Department of Water Resources and the Highway User Revenue Fund. What impact will they have on municipalities?

• Governor Brewer and the Legislature are counting on a federal waiver on the state Medicaid program to balance the budget. At more than a half-billion dollars, it’s the biggest single chunk of savings. Are the state's municipalities worried about what happens if the state doesn’t get the waiver?

• Some Arizona cities, Phoenix notably, are using federal grant money to shore up their budgets. Are others doing likewise, and is that wise given the budget cutting mood in Washington and the possibility that such grants won't be renewed?