With an eye toward stabilizing revenues for future town budgets, the Town Council has instructed Town Manager Grady Miller to prepare a ballot proposal asking voters to authorize a primary property tax that would raise $7 million annually for the town coffers.

The council met in a special session on Oct. 10 to discuss the issue before voting unanimously on the directive to staff. The question will come back to the council with ballot language and a formal request to county election officials. It is likely the question will be on the ballot in May 2018. May elections are designated as the only time communities may pose tax questions to voters.

During a presentation to open the meeting Town Finance Director Craig Rudolphy told the council it could expect to have expenditures outpacing revenue to the tune of $6.4 million per year over the next 10 years.

He noted that the primary budget drivers for the town including street maintenance and pavement replacement, public safety in the form of law enforcement and emergency fire and medical are items the council has established as key priorities.

Public safety uses roughly half the annual General Fund budget and automatic increases to contractors, and street maintenance has been woefully underfunded.

Among the items that seemingly brought the council to agreement on a property tax is the public backlash against Crystal Lagoon at Fountain Lake, a proposed project that was envisioned as a regional recreation draw to help bolster revenues.

“I think people have made it very clear that they don’t want this type of regional draw,” Mayor Linda Kavanagh said. “People have been telling me in recent weeks that if they had wanted to live in a tourist town they would have moved to Sedona.

“I think it is important that as part of this discussion we take [the lagoon] off the table.

“We need to realize that if we want a quiet hometown, we need to pay for it ourselves.”

Kavanagh was clear she was not talking about doing away with the numerous events and activities that have become so much a part of the town including art shows, kite festival, Oktoberfest and other events.

Councilman Cecil Yates also agreed the lagoon should no longer be part of the discussion. However, he applauded Councilman Art Tolis for his effort in bringing the idea forward.

“It takes big ideas to make something happen, and I applaud [Tolis] for doing this,” Yates said. “It got people talking.”

Interim Town Attorney Fredda Bisman advised the council not to consider a formal motion on the lagoon since the issue was not on the agenda for the meeting.

Councilman Henry Leger, who has had his differences with Mayor Kavanagh over their tenure together on the council, welcomed her remarks.

“I’ve had the opportunity to work with you for several years and the comment you just made is music to my ears,” Leger said. “We have strayed away from the basic small-town environment.”

Councilman Nick DePorter said the time is now to move forward.

“It has been evident for more than a year that we can’t walk away from this,” DePorter said. “This has been shadowing us for more than 20 years. We were just not set up right. Sales tax revenue is too [unreliable].

“There are a lot of civic minded people who understand why this is needed.

“If we kick the can down the road we will just have to pick it up again in a couple of years.”

Leger asked that abolishment of the environmental fee be part of the plan; Councilman Dennis Brown agreed. The fee nets the town approximately $400,000 per year. It costs about $50,000 to administer and there is a compliance rate of about 90 percent, according to Rudolphy.

Miller said he is fine with abolishing the fee, but only if a property tax proposal passes. He said they will have a continued need for the revenue if the tax proposal fails.

There was also discussion about reducing the local sales tax, and again Miller said that should be contingent on passage of the tax proposal.

Three citizens stepped to the podium and all spoke in support of putting the property tax to a vote.

Vice Mayor Alan Magazine presented a motion to set the tax at $8 million per year, and he did not receive a second. Tolis proposed $4 million and that also had no support.

Magazine said he has concerns about doing it right the first time so they do not need to ask voters for more in a couple of years, believing it would not be supported.

Brown agreed with that and added he does not believe the $8 million is enough. It was Yates who put the $7 million in the form of a motion and that passed.

Miller said staff would work to prepare the formal documentation and bring back the proposal with a schedule for final council consideration within a few weeks.

Two previous attempts since incorporation to pass a primary property tax failed.