Vail residents rejected becoming a town.
The incorporation effort had 40% of the vote, with 95% of precincts reporting results so far Tuesday night.
Residents of the area expressed divisions concerning the idea of incorporation during the campaign.
While the group pushing for incorporation has hailed the effort as a way for the historically rural area southeast of Tucson to gain local control, many dissenters aired concerns about higher taxes and uncontrolled growth.
If Vail incorporates, it would be responsible for its own municipal services like law enforcement, transportation, and public works that the county currently provides.
Dissenters say incorporation would put residents on the hook for millions in new expenses, providing what they see as many redundant services already being provided for by Pima County.
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But the Incorporate Vail Arizona group told voters incorporation gives residents local control of the area instead of relying on the county to provide adequate services and divvy out its portion of state-shared funding to benefit the community.
As its own town, Vail would instead receive millions in state-shared funding for its own use.
Eddie Celaya is a breaking news reporter and host of the "Here Weed Go!" podcast. He graduated from Pima Community College and the University of Arizona and has been with the Arizona Daily Star since May 2019.