On Tuesday, June 23, the Sedona City Council unanimously approved its $97,963,222 budget for Fiscal Year 2026 to 2027, which begins July 1.

The vote was 6-0 with Councilwoman Charlotte Hosseini absent. There were no major changes from the tentative budget council approved on May 26.

“We are continuing to hold sales and bed tax revenues flat,” Deputy City Manager Barbara Whitehorn said. “We are seeing year-over-year increases, however, given the global uncertainty, that seems to be a more prudent way to move forward.”

The approval caps six months of work that began with the priority retreat Dec. 16 through 18, during which the council expressed little desire to increase the number of municipal employees and favored a more conservative budget in light of economic volatility. This led the council to call for a zero-based budget model, in which every expense was justified from scratch rather than every department adjusting its previous year’s budget.

The FY 2027 budget marks the second consecutive year the total budget has fallen from its all-time high of $106.1 million in Fiscal Year 2025. While the FY 2027 budget is a 5% reduction from the current year’s $103.3 million budget, that decrease is driven by a 20% drop in capital projects, from $42 million to $34 million, as projects such as the Uptown Parking Garage near completion. The garage does not currently have an opening date because its decorative exterior wall is under structural engineering review.

Operating budget year-over-year grew 4% from $61.235 million to nearly $64 million, with nearly five full-time equivalent employees added, with three of those positions created specifically to aid local schools following a March 25 joint session with Sedona-Oak Creek School District, when council directed city staff to find ways to financially back local schools, which are independent from city government.

This lead to the creation of full-time recreation programming coordinator in the Parks & Recreation Department for after-school programming, a Parks & Recreation janitor to aid the program, and a full-time maintenance worker who will also maintain the Sedona Red Rock High School’s baseball field, with the goal of improving SOCSD student recruitment and retention.

The city committed $76,000 to hire a school security consultant for both SOCSD campuses, and a series of smaller one-time appropriations for SOCSD that focus largely on security improvements — with the independent Sedona Charter School receiving $23,000 in new playground equipment.

Other staff changes in the budget are the creation of a full-time Information Technology support employee, a converting a part-time court specialist to full-time, and converting a part-time bicycle pedestrian coordinator into a full-time position.

In FY 2023, the city had 177.5 full-time employees; 201.65 in the current fiscal year, with a total increase of 4.97 FTEs in the approved FY 2027 budget.

Among the operating increases, the city’s most significant are an Arizona State Retirement System contribution of roughly $1.9 million; a $766,000 increase to the city’s community service contracts with Community Library Sedona; $300,000 for advertising and tourism; $250,000 for a mini street sweeper for the Uptown garage; $150,000 added to the pavement preservation and road rehabilitation contract; $125,000 for an Uptown Community Focus Area design services; $100,000 for pre-approved house plans required under Senate Bill 1529, and $75,000 for updating the city website.

The city also moved to pay off the remaining balance on several debts, including financing for energy conservation equipment; micro-transit vehicles; a vactor truck, a dump truck and snowplow and police vehicles, with at a total cost of $948,053 and an interest savings of $75,548.

Capital Projects

Whitehorn flagged capital projects that several residents had raised as costing more than the budget allocates, such as a debunked claim the city intended to overspend on purchasing the Brewer Road building, home to the Parks and Recreation Department and City Court offices, from SOCSD before any serious talks had occurred.

Sedona City Council candidates Jean-Christophe Buillet and Rich Gay, as part of their campaign, made a social media video citing the city’s West Sedona Intercept Lot at SR 89A and Upper Red Rock Loop. The project, PT-05, carries a $100,000 appropriation in Fiscal Year 2027 to 2028, and last year’s FY ’25 to ‘26 Annual Budget had included a $24.8 million placeholder “for a possible parking garage” that has since been removed.

“The eventual plan was to possibly add a parking garage out there, but it was determined in evaluating the capital projects that that was an unlikely thing for us to do in the next 10 years,” Whitehorn said. “So that is no longer in the budget, there, so if you look at last year’s budget, there was a placeholder for that, and in … coming fiscal year, that is not in there.”

The modeling approach for the Fiscal Year 2027-28, budget will be decided at a future meeting.