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For the first time in three years, Los Alamos County staff anticipates a slight increase in county revenues, reversing the downward trend of the past three years.
Gross Receipts Tax (GRT) collection dropped 20 percent during that period, and the county originally projected another 5 percent decrease for FY2015.
Now, with the federal government budget adopted in January 2014, the county projects a 2 percent increase in GRT. Council directed staff to prepare a flat budget, rather than one with another 5 percent reduction in expenditures, as originally proposed.
This is the first year of a new biennial cycle, when staff will present proposed budgets for FY2015 and FY2016.
General Fund revenues for FY2015 are projected to be $1.3 million higher, or 2 percent, than in FY2014, for a total of $56.8 million. The majority of that is due to increased spending from Los Alamos National Laboratory, but the new Smith’s Marketplace is also expected to bump up GRT revenues.
Staff is proposing $46.7 million in expenditures, $1.4 million (or 3 percent) higher in Y2015 than in the FY2014 adopted budget. The majority of the increase is from transferring salaries and benefits for project managers from the CIP fund to the General Fund.
Revenues for FY2016 are expected to increase $2.6 million, or 5 percent, largely due to a proposed restoration of $1.5 million in property tax revenue, reversing a reduction approved in FY2011.
County staff continues to practice cost containment strategies such as examining county operations and eliminating vacant positions where possible without negative impacts.
The report reads, “this continuing strategy is incorporated into the culture of our organization and is evidenced in this budget. Several departments have reorganized themselves as vacancies have become available, combining functions and eliminating middle management positions and filling them with ‘boots on the ground’ workers …County workers are going the extra mile to alleviate any noticeable service reductions due to the elimination of these positions.”
This strategy will leave 14.74 positions vacant in FY2015, in addition to the reduction of 4.94 positions in FY2014. Council directed staff to include a 2 percent salary increase for employees in recognition of their efforts to maintain high quality service with reduced resources.
The move into the new Municipal building in July 2013 has resulted in savings from increased efficiencies, such as a new motor pool that reduces the number of individual vehicles needed within departments and shared use of office printers and copiers.
Another reduction in expenditures resulted from refinancing the county’s debt. Debt service is now $6.27 million per year compared to $6.9 million in previous years.
Investment revenue in the Debt Service Fund, which is based on the fund balance, is down from $158,000 to $9,000 in FY2015. The fund balance is projected to be $289,000, down from $7.3 million at the beginning of FY2013. Approximately $7 million in fund balance was used to pay for the refinance on the debt.
Last September’s flooding accounts for one of the major expenditures. The floods were labeled a 1,000-year event and caused $2.7 million in damage.
FEMA declared the event a disaster, making the county eligible for both FEMA and state funding, which will cover approximately 88 percent of the costs. The county is also requesting an estimated $5.6 million to cover mitigation work in an effort to keep the damage from reoccurring.
Other significant expenditure increases include a $638,000 in the county’s share for fire services based on the Fire Cooperative Agreement and $223,000 for the Heath Care Assistance Fund (formerly the Indigent Health Care Fund), due to changes in state law that increase the county’s responsibilities. A transfer of $300,000 from the General Fund will cover the HCA shortage.
FY2015 expenditures in the Capital Improvement Projects Funds total $6.1 million, $930,000 or 18 percent higher than FY 2014. The replacement of the county’s 20-year-old financial system accounts for $2 million of that, with on-going amounts for roads and parks and a $500,000 placeholder for potential school projects also included. No new facility projects are planned for FY2015.
The FY2016 budget includes $6.2 million for ice rink improvements and the first year of the Golf Course Improvement project. Due to better than expected earnings on investment income in the Capital Projects Permanent Fund in FY2014, $1.5 million is transferred to the Capital Projects Fund, allowing for a lower amount of General Fund transfer in future years.
The Department of Public Utilities FY2015 budget includes projected rate increases of 6 percent in the Electric Distribution sub-fund and 6 percent in the Water Distribution sub-fund. The rate increase addresses high capital and maintenance costs. Both increases are subject to normal review and approval requirements, including notices and public hearings. A previously approved rate increase of 8 percent for the Wastewater sub-fund is also included.
Tthe proposed budget is available at http://www.losalamosnm.us. Bound copies may be viewed at Mesa Public Library, White Rock Branch Library, the 311 Customer Care Center or at the county administrator’s office.
Budget hearings are at 7 p.m. April 21, 22, 28 and 29 in council chambers. The first 30 minutes and the last 30 minutes (9:30 to 10 p.m.) of each session are reserved for public comment on any portion of the proposed budget.
The budget is open for discussion and change until council adopts it. Those unable to attend the hearings may comment by: Sending U.S. Mail correspondence to County Administrator Harry Burgess, 1000 Central Ave, Ste 350, Los Alamos, NM 87544 or emailing comments to the Office of Management & Budget (firstname.lastname@example.org) or the county council (email@example.com).
Budget hearings will be broadcast on PAC-8 (Channel 8 on Comcast cable television), or via the computer using Internet streaming under the “County Council” link on the County’s webpage at losalamosnm.us.