City Stormwater Fee Hike Update

Flagstaff’s Mayor & Council decided at the January 31, 2023 council meeting to postpone a decision on the proposed utility rate hike until February 14, 2023 at the request of Councilmember Sweet, supported by Mayor Daggett and Councilmembers Aslan and Matthews.

There are three proposed rate hike scenarios, a moderate fee hike, a large fee hike and a third scenario that would be a maximum fee hike.  All fee hikes proposed would significantly raise the utility fee on city water bills over the next five years increasing the fee year over year.  The Stormwater utility has expressed capital and maintenance and operation needs of over $90M during this time largely due to the flood impacts of catastrophic wildfires Pipeline, Tunnel and Museum.

The Chamber has counseled city leaders to explore funding elsewhere to minimize any fee increase, and the city leaders have responded.  They are seeking an almost $9M state appropriation in the Arizona state budget for FY 23/24, and seeking federal funds from the $925M in Emergency Watershed Protection Act funds via the US Dept. of Agriculture.  Understanding that the needs are not necessarily long-term, the Chamber has asked Mayor & Council to also consider sunsetting the fee increases, as capital and operation needs subside after a five-year period.

We will keep you posted on the proposed rate hike.

Minimum Wage Tax Credit

The Chamber has supported Sen. Wendy Rogers SB1108 – a senate bill introduced in the current Arizona legislative session and heard in the Senate Finance Committee on January 30, 2023.  The bill, if passed by the legislature and signed by the Governor, would allow businesses operating in Arizona municipalities who have a local wage mandate higher than the state minimum wage to have a 10% tax credit on the difference in wages paid above the state wage.  Currently, Arizona’s minimum wage is $2.95 lower than the Flagstaff minimum wage. 

The bill passed Senate Finance and moves to the full Senate for consideration.  If the bill passes the full Arizona Senate, the bill will be forwarded onto the Arizona House of Representatives for further consideration.  If the bill passes the state house without being amended, the bill will go to the Governor for her signature or veto.