Mayor: Mesa growth stagnated with economy - East Valley Tribune: News

Mayor: Mesa growth stagnated with economy

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Posted: Tuesday, June 30, 2009 10:04 pm | Updated: 1:09 am, Sat Oct 8, 2011.

Mesa Mayor Scott Smith says he's not surprised by the latest figures from the U.S. Census Bureau that show the city's growth rate stagnating at just under 1 percent for the last couple of years, and attributes it partly to the slow economy.

He termed it a chance for the city to "catch up" on providing required infrastructure for all the growth that's already occurred.

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The new census figures released Wednesday show that the rate of population growth has slowed in most Arizona communities. In some cases, the pace between July 1, 2007, and a year later is only half that in the 12 months preceding.

In Mesa's case, the growth rate fell marginally from 0.9 percent in 2006-07 to 0.8 percent in 2007-08. As of July 1, 2008, its population is estimated at 463,552.

A drop in the growth rate is problematic because that could mean less money for Mesa. Population numbers are directly tied to how much state-shared and federal revenues communities receive.

"Whenever those numbers go down, you won't get as big a piece of the pie, so certainly it's a concern for us," Smith said. But he added that because the growth rate seems to be proportionately slowing for most other communities as well, the impact overall for Mesa should not be too hard.

The mayor said indicators such as sliding building permits, lower housing sales and fewer utility hookups all have pointed to this trend over the last few years.

Building permits for new single-family homes in Mesa have declined steadily. From a high of 1,520 in 2004, they went to 1,350 in 2005, and then tanked to 870 in 2006, 852 in 2007 and 578 in 2008. As of May this year, 141 new permits have been issued.

There have been positive signs of late and developers are showing some interest, but still, the numbers aren't reflecting a reversing trend yet, said Tammy Albright, Mesa's deputy building safety director.

Smith said in the 1980s, 1990s and this decade, Arizona became "drunk on the growth numbers" without thinking about the accompanying services that needed to be provided for people moving in.

He said he would rather see quality than quantity in the kind of people who move to Mesa, to make growth areas a success.

"That will depend on success of ASU Polytech and Mesa Proving Grounds and the Aerospace Institute," Smith said.

The city is headed in the right direction by way of building new fire stations in east Mesa, for instance, he noted. Money for these as well as other public safety and street improvements is going to come from a recent voter-approved secondary property tax that kicks in this year.

Other Mesa leaders also don't see the slowed rate as a long-term issue, blaming it on the economy, which has prompted people to stick to living wherever they are currently.

Job creation in Arizona went from one of the top in the nation to dropping down to 49th or 50th, and it has to do with the economy, said Roc Arnett, president and CEO of East Valley Partnership, a nonprofit that focuses on economic development.

A decline in the illegal immigrant population also has contributed somewhat to the decline in growth rate, Arnett added.

"The Hispanic population has dissipated because of tougher immigration laws and it's one of those things, particularly in Mesa, it's had an effect because undocumented folks that were here have moved on to other areas," Arnett said, noting that enrollment numbers at schools with typically "heavy" Hispanic populations are down.

The slow rate will affect investment and construction, exacerbating the current decline in retail sales, Arnett added.

Valley economist Elliott Pollack blamed the slow growth rate on a slowdown in migration from other cities because of the jobs being lost in Arizona. He also said there is less illegal immigration from Mexico and other neighboring countries because of tougher employer sanctions law.

"Plus the people here legally also, the Hispanic businesses, are feeling the brunt of the slowdown in commercial and residential construction, tourism and other service industries," he said.

The slow population rate pattern is especially evident in what had been the "hot" growth communities of the first half of the decade, those in what had been the exurbs.

For example, Queen Creek saw its year-over-year growth rate cut in half.

Pollack said this trend will further hurt retail sales and housing, both of which "are already hurting."

"When you add to that slowdown in revenues because people already here are spending less and slowdown from construction sales tax, it essentially means that there simply is going to be a period when cities are going to have to tighten their belt," Pollack said.

Among large communities, the rate of change was smaller. But that didn't mean there weren't some that showed strong growth. Gilbert, for example, added more than 10,000 people in a single year. That is a 5 percent increase in one year, somewhat slower than the 5.3 percent annual increase the prior year.

Two other Arizona cities also were in the top 20 nationwide of rapidly growing communities of more than 100,000: Peoria with a 45 percent growth rate since 2000 and Chandler at 39.5 percent.

Overall, Arizona grew at a rate of 2.3 percent in the year ending July 1, 2008, compared with 2.8 percent the year before. And the state's population is up close to 31 percent since the 2000 census.

As for cities like Chandler still posting higher growth rates, Smith said Mesa has matured and it doesn't have large tracts of farmland the way some other East Valley cities do.

"It's now their time. Our time for rapid growth has happened," he said.

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