Guadalupe’s budget picture darkened after residents voted down a proposed primary property tax intended to shore up municipal finances. The levy, which would have produced roughly $300,000 a year, failed by a margin of 195 to 135 — a 58 to 42 percent split — with just 11 percent of active registered voters casting ballots. That outcome left the town with a shortfall that remains substantial: officials had been wrestling with a near-$1.5 million budget gap and, after accounting for the potential tax revenue, still faced an estimated $1.16 million annual deficit.
The rejection came on the final day to vote; Mayor Valerie Molina appealed to residents in a Facebook message on May 19 urging support. Her post framed the proposal as a long-term safeguard, saying the measure was "about helping Guadalupe continue forward for another 50 years" and that it would "help decrease a major funding gap for our town." Despite the appeal, turnout was low and only 330 ballots decided the issue, a number town officials say leaves Guadalupe with limited immediate recourse beyond dipping into savings and making difficult staffing and service decisions.
Guadalupe, a municipality of roughly 5,300 people squeezed into less than one square mile between Phoenix and Tempe, was founded in 1975 to protect the community’s culture and history and to maintain political independence from neighboring cities. Its population is made up largely of Latino residents and members of the Pascua Yaqui tribe. Town leaders have long said they must find a stable, ongoing revenue source to operate municipal services; the rejected property tax had been envisioned as one such source but was not included in the town’s 2027 budget.
Town financial documents show the municipality expects to spend $7.16 million in operating funds in the current fiscal year ending June 30. To cover the gap without new revenue, the town has been drawing on reserve funds, but those reserves are projected to be exhausted by fiscal year 2029 — a timeline accelerated by two years from earlier projections. With the property tax off the table for now, officials estimate that 18 percent of current service and program expenditures would have to be cut from the general fund if no other revenues are identified.
Town Manager Jeff Kulaga, outlining the fiscal reality in the budget materials, said the choices ahead will be painful. He is proposing a 5 percent wage increase effective July 1, 2026, for the town’s 17 full‑time and 10 part‑time employees at an estimated cost of nearly $70,000. Kulaga described that raise as necessary to keep up with the cost of living and called it a "nominal increase" relative to the responsibilities handled by the small staff. At the same time, he acknowledged the larger unresolved question: whether to eliminate services or seek revenue through higher fees and rents — decisions he deferred to the Town Council.
The council now faces a compressed set of options: adopt major spending reductions across services and programs, identify new revenue streams through fee adjustments or other charges, or continue to draw down reserves until the town’s savings are exhausted. Budget documents submitted by Kulaga warned that "difficult policy decisions are necessary," and municipal leaders will have to weigh the political and practical impacts of each path. The rejected tax had been promoted by supporters as the first step toward a sustainable revenue base; with its defeat, town staff and elected officials must return to a narrower set of tools to maintain operations.
The narrow turnout and the size of the vote underscore the role a small number of residents played in deciding the town’s fiscal direction. County elections data show just 11 percent of active registered voters participated in the measure, and the 60‑vote difference determined the fate of the proposal. For now, Guadalupe will continue to operate while officials plan next steps, but the municipality’s time horizon for restoring fiscal balance has shortened and the choices facing local leaders are likely to be both immediate and consequential.
Street sign for East Pima Street in the Town of Gila Bend, Arizona — the small town identified in reporting as edging closer to insolvency.