OV Path Forward: Let's Talk Water

Share your ideas and priorities to conserve water today!

Oro Valley’s water supply is a concern voiced by many residents throughout the past few months. The Town has numerous programs, requirements, and plans to ensure an adequate and quality water supply for current demands and anticipated growth. 

Due to the Water Utility’s continued planning and conservation measures, Oro Valley has never experienced a water shortage that required extreme responses (e.g. pausing permits, draining pools, or reducing irrigation).

But there’s always more work to be done
Oro Valley’s Central Arizona Project (CAP) water allocation is anticipated to decrease by 25% as early as 2027. Although this decrease is sustainable, implementing measures on both a large and small scale to reduce drinking water use is important. All new developments must comply with Oro Valley’s standards for rainwater harvesting, native plant use, irrigation restrictions and more.

Should water conservation requirements be increased for greywater use and more?
Nearly 90% of the 23,000 water customers are residential. Most residential customers use 5,000-7,000 gallons of water per month with over half being used outdoors. Water is wasted due to evaporation from pools and fountains, overwatering plants, and leaking irrigation systems. In fact, 42% of the leaks confirmed by customers in 2023, were from irrigation systems.

How can the Town increase awareness about the importance of water conservation and resources available?
Expansion of the CAP water delivery system and use of reclaimed water for irrigation to reduce potable water consumption are a few measurable actions included in the current 10-year plan. Everyone’s voice is needed to help create the actions for implementation over the next 10 years, through OV’s Path Forward.

Join the conversation today!
Everyone’s voice is needed to answer these questions and more on OVPathForward.com. Visit the “How OV Sustains” page, to read a short report, watch a video, listen to a podcast and most importantly, share your perspectives and expectations for OV’s future. Your participation is critical to establishing the vision, values, and goals for Oro Valley’s future. Please check www.OVPathForward.com often to make your voice heard.

Financial Headwinds in the Offing Starting in 2026

Town projects that it may need at least $11 million in bond funds in 2026-27
The Town of Oro Valley will need to issue a minimum of $11 million in bonds in fiscal year 2026-2027 to cover a major shortfall in funding for major highway projects and the ever-growing costs of the pavement preservation program. 

This information was disclosed by Town Finance Director David Gephart during his presentation of the latest five-year financial forecast to the town’s Finance and Budget Commission last week. "We've got a funding gap that we're going to have to address in some form or fashion," he stated. This gap manifests as a negative ending balance of $8.5 million in the capital fund by Fiscal year 2029 if no bond is issued. It is a gap that begins to build in fiscal year 2027.

This is the minimum needed because it assumes the deferral of many capital projects, including one that would replace the current police facility
“We placed a lot of projects that have been in the CIP in prior years…off to the side. We're going to be looking for again additional alternative sources to fund some of those grant funding and you know probably might be looking at some revenue enhancements and things like that….We don't have those really really dialed in or assumed in the forecast.”

Three reasons for the projected funding shortfall

• The forecast predicts that the General Fund will experience a reduction in the surplus of revenues compared to expenditures (see panel right). According to Gephart, one cause is a decrease in state shared tax revenues. The other cause is a significant increase in operating and maintenance costs “…because we're seeing higher inflation.” 
• The town has a number of bridge and road repairs that need to be done. At the same time, the costs of the pavement preservation program are skyrocketing. “We’re hoping that that growth moderates. We don't anticipate that it's going to go up another 50% but this is where we're at.” 
• Growth in gasoline tax revenues cannot keep up with inflation. “What we're assuming is really moderate growth 3.4% to 3.6% in highway user gas tax revenues and that's provided to us from the Arizona Department of Transportation.” 

Taken as a whole, the town’s cash balances will decrease by $6.8 million even after an $11 million bond issue
Gephart reflected on the situation by focusing on four funds. However, funds in these accounts are frequently transferred around. For example, in this instance, the bond funds would initially be part of the General Fund, then transferred to the Capital Fund, and subsequently to the Highway Fund. So, we totaled their balance. We included the Community Center Fund because it also receives such transfers for capital spending. According to Gephart, "The Community Center Fund actually looks solid.”

The shortfall is really $17.8 million.
According to Gephart’s forecast, by 2029, the total ending balances of these funds will decrease by $7 million. This decrease is after the issuance of the $11 million in bond funding. So, the shortfall in funding is $17million. (see panel left)

And remember…there are other capital projects that Gephart has assumed will be deferred.

Financial headwinds ahead
Several weeks ago, in "In For A Penny, In For A Pound," we mentioned that the town would begin encountering challenging financial decisions once the Parks Bond Money and the ARPA Funds are depleted. We highlighted this after the town council swiftly approved $390,000 to replace a bridge on a town golf course. "Those days are behind us. The 2025 budget will reflect some remaining funds, but the bulk of town funding will need to come from ongoing revenue sources. We anticipate budgets becoming increasingly constrained over time.”

The town has ample time to set the right course

Yes. Gephart’s five year financial projections affirm just that. Remember: These projections are based on a set of assumptions of events that may or may not happen. The further out the forecast year, the less likely that the forecasted result will happen. But, the projected results are a warning that strong financial discipline will be required to navigate the choppy waters.
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Ending Visit Tucson Destination Marketing Agreement Sends Town Staff Into Panic Mode

The town created a mess when it dismissed Visit Tucson

In March, Town Manager Wilkins announced that the town did not renew an agreement with Visit Tucson to, among other things, provide group marketing bookings/leads for the town's two resorts: Westward Look and The El Conquistador. This ended a twelve-plus year partnership.

Wilkins violated the open meeting law by "polling" the council. Then, without a formal council vote, he terminated the relationship via a letter. He never consulted the resorts in making the decision. The day after sending the letter he learned that the resorts would have no access to Visit Tucson's group booking services; thus forcing the town into panic mode to get into a business in which they have no expertise... replacing Visit Tucson's destination marketing activities. Faced with this mess, he had no choice to bring it to the council last week to get their funding approval to move forward with his plan.

The panic happened because Wilkins made the decision behind closed doors without thinking through the implications

We learned how all this happened when the situation was discussed by the council last week and motions voted upon, in an attempt of the town to "paint over the mess" Wilkins created.

In January and February, Wilkins violated the open meeting law

...by polling individual council members in one-on-one meetings on firing Visit Tucson. Supposedly, he reviewed staff analysis of Visit Tucson performance in relation to the town. He did this in response to a strategic plan item for a Visit Tucson return on investment analysis [see panel right]. He did this in individual sessions not open to the public. From these meetings, Wilkins concluded that the council wanted him to not renew Visit Tucson's contract.

In March, Wilkins sent the letter to Visit Tucson

He sent a letter to Visit Tucson informing them of the decision without considering the immediate impact on the two resorts.

Wilkins did so without understanding the impact on the two resorts

The next day, Wilkins learned that the two Oro Valley resorts would no longer be getting group booking services from Visit Tucson. Visit Tucson by-laws only allow resorts in jurisdictions that pay fees to Visit Tucson to be members and, therefore, avail themselves of Visit Tucson services. According to Oro Valley Development Director Paul Melcher, “When we terminated our agreement with Visit Tucson, [we learned that] there wasn't an automatic extension of membership to the two resorts. We found that out after we had presented the letter to Visit Tucson."

Panic ensued

Operating in panic mode, town staff cobbled together a plan to provide destination marketing services for the two resorts. According to Melcher: “We immediately went into the mode of what are we going to do for the first 30 days once we knew there might not be an opportunity for the resorts to be part of Visit Tucson. We recognized that they needed that group booking support.”

Last week, Wilkins asked the council to "paint over the mess"

Last week, staff met at the council meeting to present the Visit Tucson ROI analysis and their plan for the town to become a Destination Marketing Organization (DMO). At that time, Wilkins explained why he did not renew the Visit Tucson contract. Referring to the staff ROI analysis:

“So, those are the thoughts that we, uh, we reviewed with, uh, with council members. But if that’s really after that, uh, there really wasn't, uh, you're from the council, uh. You know we had, again, our contract was coming- the extension of the three months was coming forward-and there wasn't a council member said “You know what: Let's put on the agenda and renew and extend.”

Council vote: 6-1 in favor of the "paint job"

In the meeting, council voted 6-1 (Councilmember Solomon voted no) to ratify to no longer use Visit Tucson, to have the town proceed with becoming a DMO, and to implement the plan. This, despite the fact, as Solomon noted, that the town is not prepared to make this work:

“Everything we see here is on paper. We're already behind the game. We would have needed this to be in place and fully operational on the day that we left Visit Tucson and it wasn't and it isn't now. This is a wish list. There is nothing functioning here. There's no website. We don't have the expertise on staff. We don't have the experience and we don't have nearly the financial capability that Visit Tucson has.”

The whole thing is bizarre

The manner in which this is being handled is amateurish and places a significant revenue stream source of the resorts and the town in jeopardy. As Solomon noted: “If this goes wrong, what are the consequences: A third of the income to the Hilton and a good part to the Westwood look and a negative 11 million dollar economic impact to the town. This may be good a year from now. But it is not ready. It is short-sighted and it can cause irreparable harm to our community and our economy.”

So why would the Wilkins do this?
Is town staff incompetent? Or is there something we have not been told? Our gut tells us it's some of both.

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Bits and Pieces

Town Manager 2025 Recommended Budget out soon

Town Manager Wilkins and staff are putting the final touches on the 2024-25 town budget. It is a complicated effort, covering all of the town's ten plus funds.  Look for the document to be available by the end of the month, followed by town council study sessions. Can't make the sessions? Don't worry.... we will.

Next Tuesday: "Financial Headwinds in the offing starting in 2026"; a focus on a precursor to the budget: The town's five year financial forecast of four key funds.

Friends of Pusch Ridge Golf sponsor April 26 "Birthday Bash"

Join us on Friday April 26, 2024 for this exclusive event sponsored by the Friends of Pusch Ridge Golf. We are celebrating three major milestones with this celebration: the end of Year 3 after our course’s exciting re-opening in 2021; 40 years of golf at Pusch Ridge since it’s original opening; and the Town of Oro Valley’s 50-year birthday! 3-40-50 reasons to celebrate!" Learn more here. 

(Source: Friends of Pusch Ridge Golf media release)

Local group seeks "Performing Arts Center"

For years, the town has considered creating a performing arts center. In fact, it was one of the centerpieces in the original designs of Naranja Park. Several weeks ago, the town council, while considering changes to the town's Community and Economic Development Strategy, entertained audience cards. Members of the Oro Valley Theatre Company were in attendance. Council Member Mo Greene is a member of the theatre company board,

along with Judi Rodman, the spouse of former Council Member Bill Rodman, and former council candidate Charlie Hurt. 

Speaking at the meeting, Gene Abravaya (Theatre Company Board Member) noted:  "The company deserves a home of its own--A place to perform, as well as all the other performing arts organizations in Oro Valley and the surrounding area."  The council took no action.

Celebrate 50 years by planting 50 trees across four Oro Valley parks, April 27

The Town of Oro Valley invites all community members to help us celebrate the Town’s 50th Anniversary by joining us for the "50 Trees for 50 Years" community tree planting event on Saturday, April 27, starting at 9 a.m.

This event promises to be a memorable occasion, bringing together neighbors, friends and families to contribute to the beautification of our community.

Roll up your sleeves and be a part of history as we plant 50 trees across four locations in Oro Valley:

• James D. Kriegh (JDK) Park, 23 W. Calle Concordia 
• Naranja Park, 810 W. Naranja Drive 
• Riverfront Park, 551 W. Lambert Lane and 
• Steam Pump Ranch, 10901 N. Oracle Road

Staff will be stationed at blue tents at each park, ready to assist and guide participants in the planting process. The trees will vary in size, but most will be small at approximately three-to-six feet in height and one-to-two inches in diameter, with 15-gallon tree bases. Event participants will help place a few shovelfuls of dirt to complete the planting process. (Source: Town of Oro Valley Media Release)

Oro Valley Built Water Reserves in Fiscal 2023

Water's Annual Report gives glimpse into water operations 

Oro Valley Water Director Peter Abraham emphasized the efficient management of water resources as a cornerstone of community sustainability earlier this month in his remarks to the town council. 

Abraham was presenting the utility’s fiscal 2024 Annual Report. An annual report is required by Article 15-4-5 of the town code. "It's prepared by the Water Utility staff, the commission reviews and comments on the report. Town staff renders a report to town council on behalf of the commission and the report becomes a public document once accepted by the council.”

A dedicated team of professionals keeps everything working

The operational backbone of the water utility lies in its dedicated teams, particularly the water operations group, which oversees metering, distribution, production, water quality, and control systems. Their steadfast commitment ensures the reliability and efficiency of the town's water infrastructure. (See panel right)

Serving 21,300 accounts 

In terms of customer service, the water utility served more than 21,300 accounts with prompt billings, cash receipts processing, and addressing customer inquiries. Furthermore, through an intergovernmental agreement with Pima County, the utility does monthly billing for Pima County Wastewater, increasing its revenue streams.

Has 35,000 acre feet of drinking water reserves

Water resource management remained a focal point, with prudent use of Oro Valley’s three main sources of potable water: Groundwater, CAP water, and reclaimed water. (See panel left) The town has accumulated 35,000 acre feet of long-term storage credits. That's almost six years of water production!

“We continue to buy our full CAP allocation, and we continue to store unused CAP water for future use if we need it….”  Last year, the utility:

• Used CAP water to replace the 4,925 acre-ft. of groundwater pumped 
• Stored approximately 2,807 Acre-ft. of CAP water for future use (Drinking water Reserves)
• Stored approximately 10 Acre-ft. of reclaimed water for future use (reclaimed water reserve

“Between the entitlement or the allocation of CAP water we have of 10,305 acre feet a year, you subtract out replacing the groundwater we pumped and the deliveries we directly delivered. The rest of that we stored in nearby underground aquifer storage facilities, and that was about 2,800 acre feet of that unused CAP water was stored and became long-term storage credits. That goes to our long-term storage credit account, so that account now is just under 35,000 acre feet, so that's great.”

Conservation focus….60% of leaks are from irrigation

Conservation efforts were also paramount, with extensive community outreach and education programs aimed at promoting water efficiency and responsible usage. “Over 8,000 automated alerts were sent to registered users in 2023, and 60% of the leaks were, as confirmed by customers, were related to irrigation leaks, so this is one of the areas we focus with our customers is operating and maintaining their irrigation system and keeping it in good operating form.”

Financial sustainability 

Financially, the water utility maintained stability and resilience despite its operational demands. With two utility funds, the Enterprise Operating Fund and the Water Resources System Development Impact Fee Fund, the utility effectively managed its debt obligations of $18.3 million. Annual debt service is $3.8 million. The water utility's bond ratings from Fitch Ratings and Standard & Poor's is AA and AA+ respectively, meaning that debt is considered of low default risk and that the utility has a strong capacity to service its debt.  
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Jaegar Paints "Rosy Picture" of Oro Valley Amphi School Student Performance...But

An optimistic view

On April 3, Superintendent Todd Jaegar of the Amphitheater United School District provided a comprehensive update to the Oro Valley Town Council, highlighting key developments and initiatives within the district.

Jaegar thanks Oro Valley for its contribution to the School District Expressing gratitude for Oro Valley's invaluable support, Jaegar underscored the impact of the town's $100,000 contribution, which has facilitated notable enhancements across various educational facilities. These improvements include the establishment of a preschool playground at Ironwood High School, the expansion of preschool play areas at CDO, and the creation of a cutting-edge "STEAM" room at CDO, fostering hands-on, interdisciplinary learning in science, technology, engineering, arts, and mathematics.

Additionally, Jaegar lauded Oro Valley's pioneering Resource Officer Program, emphasizing the crucial role it plays in fostering a safe and secure learning environment. “We have here in the town in terms of the level of SRO support and also the relationship that we have with the SRO program and the police department itself here in Oro Valley. We've been in the situation where just a couple of years ago where the only jurisdiction that was supporting its community through the presence of SROs in the community schools was Oro Valley.”

Jaegar says district students outperform peers…

Jaegar’s opened his discussion with council saying that: “Our school district as a whole outperforms its peer districts as well as the state average district in terms of our student performance measures.” He focused on the State Department of Education “grade” system where they “grade” each school on an overall basis. He stated that all of the schools within town limits are rated “A”. He was incorrect. Ironwood High Schools’ overall state determined grade is a “B”. It earned an “A” the prior year. (Source of information: https://azreportcards.azed.gov/schools).

…He fails to note lackluster student achievement results 

Based on the same grading system, less than 60% of students attending Oro Valley’s Amphi Schools are academically proficient at their grade level. (See Chart) At IRHS, 47% of students at that school are academically proficient. The comparative statistic for CDO is 58% proficiency. Student academic proficiency at Basis Oro Valley is 85%. Basis Oro Valley is not part of the district

Yes. Students a both Oro Valley High Schools perform far better than Amphi High School’s 11% student proficiency score. So Oro Valley’s high schools bring up the school district average dramatically!

There are better performing public high schools in the region. For example, Catalina Foothills High School students test at 78% student proficiency level. Three are also worse performing schools like Marana (40%) and Sahuarita (46%). Hopefully, those are not the standards to which Jaegar refers when he says Amphi District outperforms peers.

Oro Valley’s middle and elementary schools show similar lackluster student academic results. Middle and elementary students going in schools in the Catalina Foothills School District achieve higher academic results (Manzanita Elementary: 72%; Orange Grove and Esparero Middle Schools: 66%).

Want to do your own comparisons? Click here 

The Amphi “Portrait of a Graduate” 

Jaegar outlined the district's steadfast commitment to nurturing well-rounded graduates equipped with essential skills for success in an ever-evolving world. The District developed the Portrait of a Graduate (panel left) in concert with business leaders, parents, and students. The concept identifies the need that graduates have "soft skills" such as critical thinking, the ability to collaborate, creativity, communication skills , a desire for community involvement, and problem-solving skills. The goal is to ensure that every graduate leaves with a well-rounded education that prepares them to be productive citizens capable of tackling real-world challenges.

Staffing and funding: A forever complaint 

Jaegar concluded his council briefing by addressing ongoing concerns regarding insufficient funding for teacher salaries and essential capital purchases, as well as the challenges encountered in teacher recruitment: “Most certainly one of the areas that we have to grapple with here in Arizona is the difficulties we have as a State in recruiting staff to our state whether that's school bus drivers or competent and qualified highly certificated teachers. It is very hard for school districts to compete number one with districts in other states, but even for staff that might be also hired by the private sector.”

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Bits and Pieces

Barrett: Should the town rename the Community Center Fund?

At last week's council meeting, Vice Mayor Barrett reacted to a comment made by Council Member Solomon. Solomon has repeatedly complains that half of the half percent Hiremath Community Center sales tax no longer goes to support golf only.  

"I usually listen to this argument and let it pass, but I don't feel like I can tonight," Barrett noted. "The community center fund sales tax was passed unilaterally by council on a four-to-three vote. This council, on a six-to-zero vote, expanded the use of that sales tax with the exact same authority that passed it to begin with; through the same mechanisms, and ordinances. So continually saying that the community center fund sales tax is just for the community center and the golf courses is just not the case.” That expanded use of these sales tax monies also now goes to funding Naranja Park and other park-related amenities. "It probably shouldn't even be called the community center fund anymore, because now that can be allocated to parks and recreation."

Tiny Bits

• Naranja will likely have its grand reopening in May (Source: Town Manager Wilkins)
• Ashley Furniture is now "Lounge By Levitz"
• Council voted to reduce town's Historical Preservation Commission" from seven to five members. Lack of resident interest in being on the Commission was the primary reason 

Big 50th Anniversary Celebration Saturday

The Town of Oro Valley invites residents and visitors alike to join us for the 50th Anniversary Community Celebration at James D. Kriegh Park this Saturday, April 13, 2024, beginning at noon and concluding with a fireworks finale at 9:30 p.m. JDK Park is located at 23 W. Calle Concordia. (Source: Town of Oro Valley Press Release)

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