Gilbert looks to smooth out street lights budget | News | gilbertsunnews.com

Since 1985, Gilbert officials have created 399 Street Lights Improvement Districts (SLIDs), within which property owners pay electricity costs for the street lights.

A town practice of creating new street lights improvement districts (SLIDs) for every new development has caused a budget tracking problem for Gilbert officials.

A SLID is a geographical area within which the property owners pay to cover the cost of electricity for the street lights in the area through property taxes.

Miguel Cantu, a Marvin Andrews Fellow from Arizona State University working with Gilbert officials, noted that the SLIDs are used solely for electricity payments and not for pole replacement or infrastructure maintenance.

“It's formed by the developer when they have to determine the geographic boundary, and then 50% plus 1 of the property owners have to agree to create the district,” he said.

“In Gilbert's case, that has always been the developer. The developer is always 100% of the property owner. So as part of the permitting process, it is a requirement to create a SLID, if there is a need to put street lights in that boundary.”

The average payment from SLIDs in 2024 was about $33 per year, with the oldest SLID created in 1985 and the newest SLID in 2023.

Cantu said the SLID creation process itself takes eight to 11 months to complete, in collaboration with town staff. It involves determining the geographic boundaries, a street light layout and installation and council approval.

The town then enters into an agreement with the developer for the payment.

Currently, Gilbert has 399 SLIDs, not including undeveloped land, subdivisions annexed in the 1980s, and most commercial developments and county islands.

“This leads us to our next question: what about the areas that are outside of the SLIDs?” Cantu said.

“The town is responsible for paying for the electricity costs for the areas that are not in any SLID. In FY2024, the town paid approximately $1.06 million from our street funds.”

In total, all SLIDs in Gilbert, both town-owned and developer-owned, paid $2.2 million last fiscal year in electricity costs.

Customers who want to know about what they paid in these costs can visit the Maricopa County Treasurer’s office website, input their address and get a breakdown of their property taxes that includes what they paid for street lighting.

The issue at hand for town officials is that budget tracking for 399 SLIDs is becoming difficult, with each SLID having its projections for electricity use and separate accounts where the taxes are deposited.

“They have to ensure that the correct amount of property taxes are being reported to each SLID each month, so this isn't an annual process – it's something that they have to do every month,” Cantu said.

Another problem is also that the town ends up paying for electricity in Non-SLID areas, as per Cantu.

To remedy the situation, the town’s budgeting office put forth three options:

• Continue to create SLIDs.

• Create a town-wide SLID with property owners sharing the cost of electricity for all street lights.

• Stop creating new SLIDs and have the town foot the cost of areas that are not within an existing one.

According to Cantu, creating a town-wide SLID would require a vote among all Gilbert property owners.

“If we were to have new annexations in the future, we would need to hold another town-wide property vote of the property owners in order to get that new area merged into the existing town SLID or we could create a new budget or a new SLID for that area,” he said.

Councilman Jim Torgeson wanted to know the cost of such an election and what the town would save in the process.

“If we do it electronically, that's not a terrible expense. If we send the mailer out to all the households it would cost us about $50,000 to $60,000, to reach all households,” said Kelly Pfost, Gilbert’s budget director.

Pfost added that creating a town-wide SLID would release about $1 million yearly from the streets fund to use for other improvements.

Town Finance Director Hakon Johanson said that his staff alone spent 200 hours in a year managing SLIDs, with other departments like budget pitching in as well.

Councilwoman Yung Koprowski leaned toward keeping the status quo.

“The only reservation I have is that in order to change, I have to feel like there's a big issue that's pushing that change. Right now, I'm not feeling that as much,” said Mayor Scott Anderson, agreeing with Koprowski.

Vice Mayor Bobbi Buchli and Councilman Monte Lyons also favored the current system

All council members rejected the notion of stopping the creation of new SLIDs.

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