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The small town faces an uncertain future and limited options to dig out of its financial hole and avoid going broke. With limited means to raise revenues and a population needing services, it remains unclear how the small town will maintain its independence.

The property tax promised to raise only $300,000. Guadalupe still faced a huge $1.16 million annual shortfall. In the current fiscal year ending June 30, the town expects to spend $7.16 million in operating funds on its services.

Mayor Valerie Molina, in a Facebook post on May 19, the last day to vote, wrote that the property tax was “about helping Guadalupe continue forward for another 50 years” and to “help decrease a major funding gap for our town.”

“So if you are wondering why the town is asking voters to consider a property tax, it is because this is about protecting the future of Guadalupe and preserving services that directly help our community members every single day,” she wrote.

Final unofficial results showed Guadalupe voters rejected the proposed tax by 58 to 42 percent. Just 60 people determined the critical outcome. The measure lost by 195 votes to 135.

County elections officials reported that only 11 percent of active registered voters cast ballots.

Currently, the town pulls from its savings account to bridge the deficit, but town budget documents indicate the town will deplete its reserves by fiscal year 2029.

That is a two-year acceleration from what was previously anticipated.

Guadalupe spans less than one square mile, wedged between Phoenix and Tempe. It was created in 1975 to retain its culture and history and hold off its neighbors from encroaching on its community. It’s made up of roughly 5,300 residents who are largely Latinos and Pascua Yaqui tribe members.

Now, the Town Council will be forced to make unpopular decisions to retain its independence or risk losing it.

The primary property tax was seen as the first step in raising a new source of ongoing revenue. While the property tax wasn’t built into the 2027 budget, it’s a blow to the town.

Without new revenues, 18% of current service and program expenditures would need to be eliminated from the general fund, Town Manager Jeff Kulaga wrote in budget documents.

Even with the need to reduce spending, Kulaga is proposing a 5% wage increase, at a cost of nearly $70,000, for the 17 full-time and 10 part-time town employees. It would take effect July 1, 2026.

Kulaga justified the wage increase, saying it was needed to keep up with the cost of living and called it a “nominal increase” for the work the town’s small staff does.

Kulaga did not provide a clear solution to the closing of that funding gap.

“Do you eliminate programs or services completely? The other part there is, can we look at raising fees, rents, etc.?,” he said.

Instead, he’s punting the decision to the council. He wrote in budget documents that “difficult policy decisions are necessary to prevent continued deficit spending.”

In January, he announced he planned to retire after the town approved its fiscal year 2027 budget.

That's nothing new, said former Guadalupe Town Manager Bill Hernandez. At age 25, he became the first to take the role and then returned to the position in 2009 with the order by the council to balance the budget.

He recalled having to make tough decisions, such as implementing 10% cuts to salaries and stopping overtime for firefighters.

Hernandez said it’s always been difficult to balance a budget, but when he left in 2014, the budget was balanced, and they had money in their reserves.

He no longer lives in Guadalupe, but was there at its inception and cares for the community deeply. Now, as a 76-year-old, he hopes to see the town continue for the sake of the family he still has in the town.

“The council needs to decide, do we want to survive or do we want to keep spending what we’re spending and then, you know, in four or five years disincorporate,” he said.

The financial emergency and property tax failure had Guadalupe resident Carlos Valenica worried.

Valencia voted in favor of the property tax, hoping to create a cushion for the town’s budget and was disappointed it did not pass.

He said it was time to put their money where their mouth was if the community wanted to continue its independence and be a township.

“It's time that we start investing or give it back to the town,” Valencia said.