The following is the opinion and analysis of the writer:
Mayor Regina Romero
Every single day, the City of Tucson delivers essential services to keep our community safe, healthy, and thriving.
In June, my colleagues on the City Council and I adopted a $2.3 billion budget for the year ahead, making key investments in affordable housing, public safety, climate resiliency, and road improvements. As we invest in these critical initiatives, declining state revenues — directly caused by actions of the Republican-led Legislature — are threatening our ability to sustain this work. Cities like Tucson have already made significant budget changes to face these challenges head-on.
Arizona cities and towns have historically relied on state-shared revenues to help fund essential city operations. This formula relies heavily on the state’s income-tax collections. It returns locally generated tax dollars to cities like Tucson. These funds are used to provide critical services without increasing other tax rates on the local community.
Regrettably, Arizona’s individual income tax collections have dropped significantly since the passage of a flat 2.5% income tax championed by former Governor Doug Ducey in 2022. As a result of the flat tax, reduced state revenues over the last two years recently led to a $1.3 billion state deficit for Fiscal Year 2025, forcing lawmakers to cut state agencies and delay critical infrastructure improvements across Arizona. But those negative impacts were not solely at the state level.
In true and typical fashion, the Republican-led Legislature adjourned with no relief for cities and towns, which are experiencing the trickle-down consequences of Ducey’s flat tax. For the City of Tucson, the situation is dire: Our state-shared revenues will be reduced by approximately $27.4 million in the current budget year.
To put this massive cut into perspective, a $27.4 million cut could result in a 20% reduction to the city’s housing department operations, which would weaken our Housing First strategy and hamper our efforts to boost affordable housing throughout Tucson, during a significant housing crisis. Such a cut could impact Tucson Fire and Police’s emergency response capabilities at a time when we need them most. A cut of this magnitude equates to taking 168 Tucson firefighters, with all of their apparatus and personal protective equipment, or 100 Tucson police officers, including their patrol vehicles and personal protective equipment off the streets. These actions of the state have necessitated that my colleagues on the Council and I prioritized our recently adopted budget to avoid these catastrophic outcomes, at the expense of any potential new spending on additional housing needs, community safety service, investments in our parks or our roads and infrastructure.
To make matters worse, we have been advised to plan for further state-shared revenue reductions. City staff estimates a $400 million loss of revenue over the next 10 fiscal years. These ongoing cuts underscore the urgent need for local leaders to plan ahead so that our city can maintain the services our residents rely on, despite the state-level decision-making that threatens the delivery of our core city services.
I am working closely with our City Manager to discuss the best paths forward, looking for cost-saving measures, and exploring new opportunities to support our core city services. The impacts that we have already experienced, coupled with the uncertainty created by these reduced revenues, means we have to be honest with ourselves about the challenges we are facing – not of our own making. I trust that Tucsonans share my concerns about the real impacts to our city as result of the flat tax.
As Mayor, I am committed to ensuring that Tucson’s city budget and operations reflect the pressing needs of our region. Together, we can find the solutions that will allow us to protect the vital city services that are needed to uplift Tucson’s economy and quality of life.
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