Chandler City Council voted unanimously at a June 11 meeting to adopt the city's budget of $931,336,929, a number that increased by $29.98 million in late May after Gov. Doug Ducey announced cities would receive a cut of federal coronavirus relief funding from the newly established AZCares Fund.

Council moved to add the $29.98 million to the tentative budget contingency to allow for spending during a May 28 meeting. The fiscal year 2020-21 budget includes a slight decrease in the city's property tax rate from $1.1281 in FY 2019-20 to $1.1201 in the coming year.

Council Member Matt Orlando said in his nearly four decades on council and the almost 20 budgets he has gone through while on council, this one is one of the strongest.

"I have a lot more positive outlook on this budget," Orlando said. "I have a more positive outlook on the American will to succeed. I have a lot more positive attitude that we will get through this. We will get through this stronger, and we will get through this better. ... This budget, in the 19 years that I have been putting together budgets—this is the best budget we have had in a long, long time."

Not all were optimistic, though. Council Member Terry Roe expressed concern at all the unknowns the future holds with regard to coronavirus and how that may impact the city financially.


"We have a conservative budget, but we cannot insulate ourselves from what is happening in this world," Roe said. "I'm proud of what Chandler does with its finances. I think we could be more conservative. I think some real hard times are out there for the future of this community and this country."

Council also approved its 10-year Capital Improvement Program for $1,164,226,378 during the June 11 meeting.

What will the city do with the AZCares funds?

Prior to approving the budget, council was briefed on options for the allocation of the city's $29.98 million in coronavirus relief funds from the state.


Cities and towns like Chandler and Gilbert received funding from the state, while cities greater in size, such as Mesa, Phoenix and Tucson, received funding directly from the federal government. Because Chandler's money comes from the state and was added to the city's general fund, there are certain restrictions on how those funds can be spent, City Manager Marsha Reed said during the meeting.

The problem comes down to the "gift clause" in the Arizona Constitution, which restricts what a municipality can do with funding, according to city officials.

"Neither the state, nor any county, city, town, municipality, or other subdivision of the state shall ever give or loan its credit in the aid of, or make any donation or grant, by subsidy or otherwise, to any individual, association, or corporation, or become a subscriber to, or a shareholder in, any company or corporation, or become a joint owner with any person, company, or corporation, except as to such ownerships as may accrue to the state by operation or provision of law or as authorized by law solely for investment of the monies in the various funds of the state," the clause reads.

For the use of those funds, city staff recommended technology improvements, programs for vulnerable populations, the city's financial reserve and small business assistance. A decision was not made June 11 as to where, specifically, the funding would go.


"Thirty million seems like a lot, but there are so many needs out there," Reed said during the meeting.

Council Member Mark Stewart said he was not in favor of using the coronavirus relief funding for the city's reserve fund but was in favor of all the other potential allocation spots highlighted by staff. The majority of council was in favor of putting some of the funding toward the city's reserve.

"
Since we are dealing with Monopoly money—I've used that term before—we can use this money. We should spend it when we get it," Stewart said. "We should get this out in the market and get the internal churn going."