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Cities and towns led by example during great recession

As the Legislature faces the unenviable task of tackling our economic and budget crisis, the League of Arizona Cities and Towns remains committed to being a positive partner with Gov. Jan Brewer and state lawmakers to move Arizona forward.

In fact, over the period of one of the longest and deepest recessions in our nation’s history, Arizona’s 91 cities and towns have led by example — cutting spending and doing more with less. We have eliminated positions and services, trimming our budgets to the bone. We have learned to work smarter. City budgets in Arizona are on average nearly 30 percent smaller than they were three years ago.

When voters last year overwhelmingly passed the Proposition 100 sales tax to help forestall devastating education cuts, our mayors and council members recognized the severity of the state’s budget crisis and responded. Cities and towns voluntarily gave up their share of the proceeds — estimated at $600 million over three years — despite substantial fiscal problems of their own.

But, equal to the desire of municipalities to find workable ideas and solutions is a stronger commitment than ever before to protect our system of sharing revenues with the state.  When Arizona voters established the urban revenue sharing system decades ago, they created a clear trust that a portion of those revenues would be remitted back to cities on a per capita basis.

This convenient single-source method of revenue collection has helped cities and towns avoid other controversial and chaotic methods of revenue collection, such as individual income taxes — a tactic that has been used in cities like San Francisco and New York.

Cities and towns are already budgeting for further reductions in some shared revenues in the upcoming fiscal year because of the two-year lag before cities get their money. That lag time was built into the system. But during times of austerity, it means that cities are going to get hit hard again — with no further action from the Legislature — because of the massive drop in income taxes collected in Arizona in 2008 and 2009.

Despite these significant challenges, there is good news on the horizon. The economic dark clouds are beginning to lift. We are seeing new, high-wage job growth and rising consumer confidence. But, this recovery is fragile — especially in Arizona, which was among the hardest hit states in this recession.

Cities and towns play a vital job creation role when it comes to recruiting and retaining the high-paying industries and companies that will lead us out of the recession.

Entrepreneurs and company leaders looking to start or relocate their businesses have options.  Arizona has been, and remains, a very good option for those companies. And, a key reason is the high level and quality of services provided by cities and towns.

Just this week, five executives from international corporate site selection firms are in the state to investigate potential locations for future expansion.  They reacted favorably to the opportunities they saw in various cities and are encouraged about the support for business development from state government.

Numerous studies, articles and surveys show that a community’s quality of life is among the top considerations for companies looking to relocate. Quality of life is the business of local governments, and it has a direct impact on job creation.

Local governments are those closest and most responsive to their constituents.

If trash goes uncollected, the negative impact on neighborhoods is immediate. If a 911 call goes unanswered, the results could be tragic and catastrophic. And, if streets and parks go unmaintained, if libraries, trash pickup and water systems go unstaffed, then quality companies that care about the well-being of their workers and families will look elsewhere. Put simply, ourcities and towns matter.

We believe our state lawmakers recognize this reality and want to do what’s best for all our citizens by growing our state economy.  Working together we can make that happen.

— Ken Strobeck is the executive director of the League of Arizona Cities and Towns.

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