Mesa voters face key 'home-rule' budget decision

• Mesa voters face 'home rule' election in November
• Home rule lets city set its own spending limits, rather than follow old state formula
• Mesa would face drastic budget cuts without home-rule provision

A decision made by Arizona voters during the Jimmy Carter administration is requiring Mesa voters to make another one this fall.

The decision involves what's called "home rule," which the City Council will consider Monday, June 16, before a likely decision to refer the question to the November ballot.

If the topic sounds boring, the real-world consequences of a "no" vote would be anything but.

Home rule is shorthand for a provision that, in essence, allows Mesa to spend the money it collects from taxes and other sources. It allows the council, rather than a 35-year-old state spending formula, to decide what's best for Mesa residents while still maintaining a balanced budget, as required by state law.

The vote is necessary because, in 1980, Arizona voters amended the state Constitution to keep cities' spending in check.

The formula allows budgets to rise along with population growth and inflation. But in Mesa's case, past councils have said the limits were too low and have asked voters for permission to exceed them. The home-rule provision must be renewed every four years.

The voters have always agreed, although the first such election, in 1982, drew only a 54 percent "yes" vote.

Approval in 1986 came by about a 2-1 ratio.

In 1990, Mesa was set to ask for home rule again. But the city manager at the time, Charles Luster, said the city could live within the state spending limits for years to come, and the council pulled the item off the ballot.

Then, in 1998, Mesa voters approved a half-cent "Quality of Life" sales tax to pay for an extensive civic wish list.

Without home rule, Mesa could not have spent that money. So the question went back on the ballot in 2000. It won strong approval then, and again in 2004, 2008 and in a 2010 vote that resulted from a state-mandated change in Mesa's election schedule.

The 2010 authorization expires with the budget year beginning July 1, 2015.

So what happens if home rule doesn't pass?

Candace Cannistraro, the city's budget director, said some parts of Mesa's overall $1.3 billion budget are exempt from the spending limits. The exemptions include debt payments, bond-funded construction and the use of grants and trust funds.

That leaves about $800 million subject to the 1980 budget formula.

Of that amount, Cannistraro said, Mesa would have had to eliminate $184 million had home rule not been in place for this fiscal year.

Exceeding the state-mandated spending limit by that amount would have caused the state to withhold from Mesa $17.7 million in what is called state-shared revenue, which is tax money the state collects on behalf of cities.

A defeat for home rule in November would not automatically reduce Mesa's sales-tax rate. The money would still keep coming in, but the city would not be able to spend it.

Some of the potential impacts:

• Mesa would not be able to spend the Quality of Life sales tax, which is now a quarter of a cent, to keep on the payroll 120 police officers and 65 firefighters whose salaries come from the tax.

• The city could not spend the 0.3 percent sales tax it levies for street maintenance.

• Nor could it spend its share of the Proposition 400 transportation sales tax that Maricopa County voters approved in 2004, money that has helped Mesa with numerous major street projects over the past decade.

"Home rule is the local control of our budget," Cannistraro said.

Although there are other ways of overriding the state-imposed limits, she said, "Mesa chooses to do the home rule because it gives the City Council the most flexibility and control over the budget locally."

The council is required to have two public hearings on home rule. The first was June 2. The second will be during its June 16 meeting, which begins at 5:45 p.m. in council chambers at 57 E. First St.

After that hearing, the council will decide whether to put home rule on the Nov. 4 ballot. Five of the seven council votes are needed for approval.

Mesa's November ballot will include a new General Plan guiding city development out to 2040 and a package of bonds for utility infrastructure.