Surprise receives $16 million shot in the arm

Coronavirus funds approved to help budget

Surprise City Hall
Surprise City Hall
File photo
Posted

If there’s any good news during the COVID-19 pandemic, it could be that it hasn’t been as devastating to the Surprise city budget as first feared.

The $16,263,957 the city recently received from the Coronavirus Aid, Relief, and Economic Security (CARES) Act certainly helped that outlook.

Surprise Finance Director Andrea Davis said the CARES money will help the city recover from sales tax losses for parts of March and May, all of April, and whatever uncertain future lies ahead because of a possible second wave of the pandemic.

“It’s to help offset those tax losses that we have seen and expect to see in the foreseeable future,” Ms. Davis told the City Council June 16 before the Council amended the budget to accept the money.

The funds Surprise received is supposed to be used for public safety personnel costs that the city has and will incur from March through December. Ms. Davis said the city plans to use the money freed up for the personnel costs to provide space in the General Fund to cut into the loss of sales tax revenue.

“If there’s a second wave, we don’t know what it looks like over the next year, so really this money is going to help offset those costs or really the loss of revenue that we do expect in the months to come,” Ms. Davis said.

The city began losing sales tax revenue in mid-March with the early end of the spring training and the resulting economic impact it brings to restaurants, retail and hotels in the area.

Surprise trimmed the fat with a hiring and pay freeze and the cancellation of some costly programs.

The Finance Department has been giving the City Council monthly updates about the budget, and so far the Council has generally indicated it’s pleased with how the city has dealt with it.

Officials are hoping the CARES money won’t be the last of funds it receives to help recover.

“This stimulus check that we got ­— for lack of a better term — may not be the last of it,” District 4 Councilman Ken Remley said. “There may be more money that may be allocated to us. We don’t know what’s going to happen after September.”

The city is awaiting word on the Federal Emergency Management Agency to help reimburse the city for costs to respond to the COVID situation. The city is also getting smaller funds — Community Development Block Grant and a Department of Justice grants — to help boost the budget.

“We have a couple of different grants that we can offset some more direct COVID-related expenses,” Ms. Davis said. “We are taking this money and employing it after the fact.”

Of course, the city is still bracing for what’s possibly to come.

“As far as the second wave goes, it looks like the second wave is coming pretty quick, at least for Arizona,” Mr. Judd said.

President Trump signed the CARES Act on March 27.

Gov. Doug Ducey announced in late May the state would use about $600 million of its $1.8 billion allocation from the federal government for towns and counties. Phoenix, Tucson, Mesa, Maricopa County and Pima County each received part of $150 million automatically for having populations of at least half a million.

Mr. Ducey divided up some, but not all, of the remaining money for cities and towns.

But Phoenix, Mesa and Tucson received $174 for each resident, while other Arizona cities, including Surprise, got only $115 per resident.

When pressed on why the same formula wasn’t used for all cities and towns, Mr. Ducey said at a June 17 news conference, “That’s at the discretion of the governor.”

“We have additional needs for those dollars,” he added, listing unemployment, insurance money and education funding statewide among them.

Editor’s Note: Jason Stone can be reached at jstone@newszap.com. Visit yourvalley.net.

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