Pima County officials say it's unlikely they will ask voters to approve more borrowing via a package of bond projects this year.
Pima County Administrator Chuck Huckelberry is advising against it, and Ramón Valadez, chairman of the Pima County Board of Supervisors, agrees the timing isn't good.
The county issues bonds to borrow money for road projects, park improvements, community centers and flood prevention, but the recession has hit property values and the county wants to pay off some of its existing debt before taking on more.
Bonds are like government loans, paid for with increased property taxes, which is why voters must approve them. Voters are asked to approve a specific set of projects and uses for the money, and a set dollar amount of bonds to be sold to pay for the projects. Then property taxes pay those bonds off.
Decreased property values mean less property tax revenue for the county. At the lowest point in the recession, Pima County property values dropped by nearly 26 percent, Valadez said.
"I’m not sure we’re far enough into a recovery to really justify trying to put an extensive bond package on the ballot for this November," he said.
The county is not nearing the state limit for debt, which is 15 percent of the assessed property value in the county. That would mean the county can't have more than $1.5 billion in debt, and it currently has less than $500,000 in debt. But Pima County is nearing a self-imposed cap on debt, Valadez said.
“We’ve already just put on ourselves a voluntary cap on the amount of debt that we’re willing to finance, and that’s this board and this community, and we’re close to it right now simply because the assessed value has dropped so far," he said.
The self-imposed cap on county debt means there is no reason to take on more debt until the county is ready to spend the money, which could be years from now, Valadez said.