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Tuesday’s budget hearings were relatively quiet, but Los Alamos County councilors accrued a substantial list of “parking lot” items to be discussed tonight.
In tandem with the budget, council approved an ordinance authorizing the county to refund $41 million of the existing Gross Receipts Tax Improvement Bonds, which mature on and after June 1, 2019 and are callable as of June 1, 2018. The ordinance authorizes up to $44 million in new refunding bonds and investing $6.7 million from the debt service fund to pay the debt service on the refunded bonds until they are called and paid.
The current low interest rates and paying the debt off early is projected to save the county approximately $1.7 million.
The ordinance gives general authorization for staff to proceed with the refunding. Council must give final approval of the actual bond sale agreement when it comes before them on May 21.
Councilors asked for assurances that the bond sale agreement would not be finalized unless rates remained low enough to provide substantial savings, then passed the ordinance by a 7-0 vote.
Staff presentations continued with County Administrator Harry Burgess reporting on County Administration and Deputy County Administrator Steven Lynne reporting on Administrative
Services and non-departmental budgets. Department of Public Utilities Manager John Arrowsmith presented the DPU budget.
The administrator’s department appears to have the highest increase, due to council’s decision a few months ago to make the county self insured. That required a $5.6 million increase to the risk management fund, but will result in long-term savings. Insurance rates increased only 3 percent this year, much lower than the 14 percent increase proposed by the insurance company.
Administrative Services will see a savings as indigent health services are turned over to the Community Services department. Lynne said that the procurement and records divisions may have slower response times due to unfilled vacancies and reductions in casual employees.
Council Chair Geoff Rodgers and Councilor Frances Berting both expressed concerns about reduced services throughout the county.
“One part of the Strategic Plan is to have a high performance organization,” Rodgers said. “I realize in tight budget times, things have to be adjusted. I just want to make sure that as we go through this process, that lower levels of service doesn’t become the norm.”
Lynne responded that departments are looking for creative ways to perform necessary services with fewer people, such as instituting more efficient procedures or utilizing information technology software.
“We’re viewing the fiscal pressure as a challenge and an opportunity to make changes and minimize and mitigate those impacts,” Lynne said.
The first parking lot item was in response to Burgess’ budget proposal for Progress through Partnering. Burgess is proposing a 4 percent savings by reducing the county’s contribution from $1,011,448 to $825,000.
Progress through Partnering includes the Regional Economic Development Initiative (REDI), the Española Basin Regional Issues Forum (EBRIF), the Regional Coalition of LANL Communities and the North Central Regional Transit District (NCRTD). The five-year initiative for these programs has expired, so all four were reevaluated.
“We looked at their support in terms of defining and enhancing our commitment to the region and the interaction there,” Burgess said.
Council action had already reduced NCRTD from $1.1 million to $500,000, with further reductions to $450,000 in FY2014 and $400,000 in FY2015. That was incorporated into the proposed budget.
Staff met with REDI representatives and negotiated a 10 percent reduction.
Due to its direct relationship to LANL, the $150,000 budget for the Regional Coalition was untouched.
A meeting was called with partner communities to discuss the future of EBRIF when its contract expired in December, since participation had declined significantly over five years. Only EBRIF staff attended that meeting.
“Based upon the lack of response, the recommendation is that we do not continue with that program,” Burgess said. Eliminating that program, along with the reductions to other programs will net $175,000 savings for the county.
Councilor Steve Girrens wants to see the Progress through Partnering budget increased from the proposed $825,000 to $1 million, reasoning that the program had been implemented at that level when GRT revenues were at current levels.
“Even if these programs are not effective, then maybe we should offer to augment something else or try something that is effective,” Girrens said. “I think our leadership here is very important for the region. We are the leaders for the region, and I want to sustain that commitment through our funding of the Progress through Partnering program.”
The proposed increase will be discussed this evening.
Girrens also reiterated his call for more discussion on reductions to social services programs, which he had supported during Monday’s discussions. A plea during public comment from Dick Tatro, president of the Los Alamos Retired and Senior Organization (LARSO), prompted Girrens’ response. LARSO operates the contract for the county’s senior programs.
“To my mind, we operate a separate but distinct niche from the bulk of Community Services programs, which largely focus on recreation or entertainment,” Tatro said.
“I would argue that the unabated support of the seniors of the community is a moral obligation of any governmental organization, and the proposed four and a half percent decrease in our contract for the next fiscal year is not only unprecedented, it does not recognize the dependency that some of this county’s frail elderly have upon our services. The needs are urgent, ever present and increasing.
“I know the financial outlook for the county is uncertain. I submit that there are seniors who feel that way about their next week’s meal.”
Girrens asked to see a list of reductions to all contract services such as this one.
“Here is a very important service being provided for seniors, and it takes a cut, and I don’t know what the unintended consequences are of some of these service cuts that we inflicted across our entire budge. Maybe we could cover some of these service cuts with some other not as important activity somewhere else in our budget,” Girrens said.
Councilors Berting and Pete Sheehey supported Girrens proposal to revisit this. Berting’s main concern was the impact on the Family Council and Sheehey is advocating for behavioral health services.
Councilor Kristen Henderson added a parking lot item regarding transit. Henderson wants to see weekend bus service between White Rock and Los Alamos to encourage tourists utilizing the Bandelier shuttle to visit Los Alamos and to provide transportation for local children.
Lynne also gave the long range financial projection. He noted that the county will show increased resources in the immediate future due to deferring some Capital Improvement Projects, but that when those projects move forward four years from now any surpluses will be reduced to zero and the Revenue Stabilization Fund will again drop below five percent. Staff is proposing to offset that to some extent by reintroducing higher property taxes next year. Council lowered property taxes two years ago.
“So even with the changes that we made here, in the long term there are still potential challenges ahead,” Lynne said. “In the near term we’re bolstering our reserves, but that’s mainly through deferred CIP. In the long term, we’re projecting to run pretty skinny.”