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Record of Proceedings

Payson Town Council Special Meeting: Final Budget Adoption and PSPRS Pension Financing Presentation - June 10, 2026

Town Council & Planning and Zoning — Wednesday, June 10, 2026
BodyPayson, Arizona
SessionTown Council & Planning and Zoning
DateWednesday, June 10, 2026
StatusFILED
Video Record
0:00 / 51:59

Original source
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0:01

Okay, I I heard that.

0:03

Okay.

0:04

All right.

0:05

I'll just wait till we start then.

0:07

Thank you, Jim.

0:08

Divider here.

0:14

Brett, can you hear us?

0:20

Can you hear me?

0:21

Okay, great.

0:22

We've got Councilmember Flaherty and Councilmember Ferris both on Zoom.

0:26

When you're not speaking, please make sure to mute and then when you do wish to see speak, please unmute.

0:32

Also please unmute to make your votes when the time counts.

0:36

Thank you.

1:16

I call this special meeting of the common council, the town of Payson to order June 10th, 2026.

1:25

Would you give us the roll call?

1:30

The record show that council member Dallin, Mayor Stephen Otto are present.

1:37

Councilmember Flaherty, Councilmember Ferris are via Zoom, and Vice Mayor Tubbs and Council Member Bell are absent.

1:51

We might see Councilmember Tubbs at the at the main meeting.

1:57

We'll see.

1:58

I talked to her today.

2:02

Okay.

2:04

A one purpose of the meeting.

2:07

Public hearing possible action regarding resolution number 2026-025 captioned as follows.

2:15

A resolution of the mayor and council of the town of Payson, Arizona, adopting estimates of revenues and expenditures, expenses, and adopting such estimates as Payson's final budget for the fiscal year 2026-2027.

2:33

I open a public hearing.

2:36

And Darren, would you present our resolution?

2:40

2026-2025.

2:43

I'll have Meg present the resolution.

2:45

Okay.

3:01

Mayor Otto and Council, thank you for allowing me to speak.

3:05

For resolution number 2026, 25.

3:08

It's a resolution for the approval of the final and adoption of the final budget.

3:14

You previously approved the temporary budget or the tentative budget at the last meeting.

3:22

And they have finalized the number so it is before you today for final approval.

3:29

Okay.

3:32

Are there any public comments?

3:37

Anyone on Zoom want to comment?

3:43

No.

3:45

Hearing none.

3:51

And uh does the council have any questions of staff?

3:57

Dallas.

3:58

I don't have any questions.

3:59

I think there's a lot of work that went into doing this budget put together.

4:02

Obviously it didn't start out like we all were hoping it would, but I think in the end it is a big budget, but as you dive into it and understand it, it's not the full expenditures of the tenant Payson reflected in the total number of the budgets.

4:16

So very true.

4:17

Anybody has questions, they reach out to any of us or staff, but I don't have any questions.

4:26

Questions.

4:34

No hands raised.

4:39

If there's no further council discussion, uh I asked for a motion and a second.

4:48

Alan, you want to be one or two?

4:50

I will make the motion to approve resolution number uh 2026-025.

5:00

And I second call for a vote.

5:08

Compliment Ferris on Councilman Flaherty, I'm sorry, we get to the right.

5:19

Anyone know who's out?

5:23

Okay.

5:23

We'll just have to do it.

5:27

Okay.

5:38

I'm not sure if it might be count uh the vice mayor.

5:41

So I'm gonna ask that to unmute.

5:43

Okay.

Discussion Breakdown — Share of Meeting
Pension Management█████████████████████████████████████████████75%
Fiscal Sustainability███████12%
Procedural██████10%
Budget Equity Analysis██3%
Summary of Proceedings

Payson Town Council Special Meeting: Final Budget Adoption and PSPRS Pension Financing Presentation - June 10, 2026

The Payson Town Council held a special meeting on June 10, 2026, from approximately 3:02 p.m. to 3:51 p.m. The meeting focused on adopting the final budget for fiscal year 2026-2027 and a presentation on refinancing options for the Public Safety Personnel Retirement System (PSPRS) unfunded liability.

Public Hearing and Budget Adoption

  • Resolution 2026-025: The council held a public hearing and subsequently approved a resolution adopting the final budget for FY 2026-2027. Deputy Town Clerk Megan Miller presented the resolution. No public comments were received. The motion carried 5-0, with Council Members Bell and Nossek absent.

Presentation: PSPRS Pension Refinancing Options

  • Presenters: Jack Reeder and Omar Daghestani of Stifel Public Finance presented an analysis of the town's PSPRS unfunded actuarial liability (UAL), which stands at approximately $20 million, plus $238,000 for OPEB.
  • Current situation: The town currently pays about $5 million annually toward PSPRS, with payments extending to 2047. The assumed earnings rate on the pension fund is 7.2%.
  • Bond proposal: Stifel proposed issuing a pension obligation bond at an estimated all-in interest rate of 5.34% (as of the meeting date). This would refinance the UAL, generate approximately $3.4 million in present-value savings, and allow the town to shorten the payment schedule to 2037 by eliminating the tail payments. A contingency reserve fund would be created to cover potential future actuarial adjustments, providing a budgetary shock absorber for up to three years of market downturns.
  • Alternative loan option: Town Manager Darren Coldwell noted an alternative commercial loan from Home and Capital at prime plus 1.25% (currently about 7.25%–7.75%), which offers more flexibility but at a higher cost.
  • Council discussion: Council Members, including Jim Ferris and Brett Flaherty, asked about prepayment options, credit ratings, and the impact on the budget. They noted that the bond option would reduce annual payments from about $5 million to roughly $3.3 million (including normal cost), resulting in net budget savings of around $1.7 million per year. Council Member Flaherty expressed concern about setting future councils up for success. The council concluded that the bond option is clearly preferable to the commercial loan given the rate differential.
  • No action: The council did not take a vote on the PSPRS refinancing. Town Manager Darren Coldwell stated that the item would be agendized at a later meeting for further discussion and decision.

Key Outcomes

  • Resolution 2026-025 adopted (5-0): Final budget for FY 2026-2027 approved.
  • PSPRS refinancing: No action taken; further discussion scheduled for a future meeting. The council appears to favor the Stifel bond proposal over the commercial loan option.

Meeting Transcript

Okay, I I heard that. Okay. All right. I'll just wait till we start then. Thank you, Jim. Divider here. Brett, can you hear us? Can you hear me? Okay, great. We've got Councilmember Flaherty and Councilmember Ferris both on Zoom. When you're not speaking, please make sure to mute and then when you do wish to see speak, please unmute. Also please unmute to make your votes when the time counts. Thank you. I call this special meeting of the common council, the town of Payson to order June 10th, 2026. Would you give us the roll call? The record show that council member Dallin, Mayor Stephen Otto are present. Councilmember Flaherty, Councilmember Ferris are via Zoom, and Vice Mayor Tubbs and Council Member Bell are absent. We might see Councilmember Tubbs at the at the main meeting. We'll see. I talked to her today. Okay. A one purpose of the meeting. Public hearing possible action regarding resolution number 2026-025 captioned as follows. A resolution of the mayor and council of the town of Payson, Arizona, adopting estimates of revenues and expenditures, expenses, and adopting such estimates as Payson's final budget for the fiscal year 2026-2027. I open a public hearing. And Darren, would you present our resolution? 2026-2025. I'll have Meg present the resolution. Okay. Mayor Otto and Council, thank you for allowing me to speak. For resolution number 2026, 25. It's a resolution for the approval of the final and adoption of the final budget. You previously approved the temporary budget or the tentative budget at the last meeting. And they have finalized the number so it is before you today for final approval. Okay. Are there any public comments? Anyone on Zoom want to comment? No. Hearing none. And uh does the council have any questions of staff? Dallas. I don't have any questions. I think there's a lot of work that went into doing this budget put together. Obviously it didn't start out like we all were hoping it would, but I think in the end it is a big budget, but as you dive into it and understand it, it's not the full expenditures of the tenant Payson reflected in the total number of the budgets. So very true. Anybody has questions, they reach out to any of us or staff, but I don't have any questions. Questions. No hands raised. If there's no further council discussion, uh I asked for a motion and a second. Alan, you want to be one or two?

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