By Virginia Korte —
There are two things that I continue to think about in light of the economic impact of COVID-19 on the Scottsdale economy.
The first is what we need to do in the next few months to best respond to the economic shortfall the current crisis is causing. As I said in a previous article, we don’t want to overreact, and we don’t want to underreact. Now is not the time to just cut everything, nor is it the time to wait and see.
In the short-term response, we do need to make additional cuts, but make them strategically:
- The City of Scottsdale should postpone any increase in residential and commercial fees such as water, wastewater, and solid waste.
- Change brush pick-up to be scheduled quarterly, instead of every 5 weeks.
- Postpone property tax increase.
- Suspend business license fees.
- Postpone filling vacant positions.
- Phase in the opening of the libraries. The Civic Center could open for a few hours per day to give access to the computers and other services not served online while leaving other libraries closed for the short term.
- Carefully time bond projects so as not to impact property tax rates.
- Increase resources in the Economic Development department for business retention and attraction strategies, as well as implement a loan program for small businesses.
- Postpone merit and market adjustments to payroll.
- Postpone travel, and nonessential training.
- Request 20-40% line item budget reductions.
- As a last resort, furlough staff.
The city of Tempe and Desert Financial Credit Union have launched a new $1 million micro-loan program to help small businesses hit hard by the COVID-19 pandemic. The program aims to help Tempe small businesses with between 5 and 50 employees with loans to help them meet payroll, pay rent and suppliers.
The city of Scottsdale should be pursuing similar partnerships to help all the small businesses effected by the COVID-19 pandemic. Leadership Matters.
The second thing I’ve been thinking a lot about is how we respond in the long-run to minimize the economic risk of something like this in the future.
During my time at the City Council, I have consistently pushed for diversifying our economy. In order for Scottsdale to diversify our economy, we must attract corporations with high-paying jobs. And in order to attract, we must have the class A office space they require, which means some strategically placed height and density.
We also must focus on diversifying our business base so that our reliance on the tourism industry is lessened. Since the Great Recession, I have been advocating for targeted business attraction efforts to draw new corporations to our city that provide well-paying jobs. Nationwide Insurance Company’s regional corporate campus is a great beginning to this diversification.
The truth is, we are seeing too many companies that should be setting up shop here in Scottsdale, going to places like Mesa, Chandler, and Gilbert. In Mesa—Google, AT&T, Fuji Films, and Waymo have all established offices. In Chandler—Intel, Insight, and Northrop Grumman have all built large offices and hired thousands of employees. Gilbert, with companies like Deloitte, and areas like the Heritage District, and the University of Arizona College of Nursing have earned the title “Best City for Business” by the Arizona Chamber.
Scottsdale should have that title. Companies like Google and Intel and AT&T should be growing our economy. Scottsdale is still the “Best city for families,” but we need to be the “best city for Business” if we’re going to stay that way. Our residents want high-paying jobs.
Ultimately, we need to commit to responding to the immediate needs of the economic downturn while at the same time build a Scottsdale that is more agile and capable of withstanding economic downturns in the future. Leadership Matters.
Virginia L. Korte
Virginia Korte serves on the Scottsdale City Council and is a candidate for Mayor of Scottsdale.