Cave Creek revenue up for now

Cave Creek is bucking a Valley trend and is seeing an increase in sales tax revenue, but it faces a drop in construction that could portend budget cuts.

Development is on the plunge, and a decline in growth-related revenue could emerge in the next two years, Town Manager Usama Abujbarah said.

Sales tax revenue is higher in 2008-09 than in past years, he said.

The reason?

Residents are more likely to spend money in town, he said, rather than make the trek to Scottsdale or Phoenix.

"We benefit from our demographics," Abujbarah said. "People don't travel and spend more in the area."

2008-09 general fund budget revenue: $6.98 million.

Expected shortfall: $0.

The bad news: To balance future budgets, the town may have to cut or stall capital improvement projects such as new roads. "Any new improvements will be delayed," Abujbarah said.

Cave Creek has made cuts in its 2008-09 budget, Town Accountant Marian Groeneveld has said.

They span all town operations, she said, but are most evident in the Highway User Fund. About $1.8 million was budgeted this year, compared with to $2.9 million last year.

The good news: Town layoffs are not anticipated, and construction of a new wastewater treatment plant at 44th Street and Carefree Highway is still online. The town hopes to break ground on the project, which could cost up to $23 million, in three to four months. It will take about 18 months to construct.