The City of Rio Rancho is budgeting for decreased revenue next fiscal year.
The fiscal year 2020-21 budget proposed by Acting City Manager Peter Wells prioritizes public safety and infrastructure, as well as increasing cash reserves in case COVID-19-related revenue declines are worse than projected. The fiscal year runs from July 1 through June 30 of the following calendar year.
“This pandemic is impacting our economy at all levels,” city spokeswoman Annemarie Garcia said. “However, at this point, it is too early to tell exactly how much.”
The city released the proposed budget last week, and the Rio Rancho Governing Body will take public comment and vote on it in May.
In the executive summary of the proposed budget, Wells recommends budgeting for a 14 percent decrease in gross receipts tax revenue due to the pandemic and holding in reserve more than $15 million, three times the state requirement, in case the decline in income is worse. The budget also accounts for the state continuing to phase out hold-harmless payments, which had been making up for income lost due to the removal of GRT on food and medical care.
“I am putting forth these recommendations so that necessary and important public services can remain uninterrupted, and so that all of the city’s already very lean workforce remains employed,” Wells wrote. “In order to achieve these objectives, many difficult decisions had to be made regarding the prioritization of resources.”
The general fund budget for the upcoming fiscal year involves just more than $64.1 million in revenue and almost $59.6 million in expenditures. Seventy-eight percent of costs relate to personnel, and 48 percent of general fund income is from GRT, Wells wrote.
At this point, city officials can’t know the size of the impact because the state distributes revenue from GRT two months after the economic activity that generated it. Plus, he wrote, it’s unknown if the city will get any federal help or how the state’s budget shortfall will impact the city.
Wells recommends forgoing employee pay raises, canceling the Pork & Brew barbecue event, cutting the previous $200,000 in funding to Sandoval Economic Alliance and doing less roadwork with one-time or unanticipated revenue.
The non-emergency medical transport program the fire department had this year will be discontinued because it didn’t generate enough income to covers costs. The employees in the program will be trained to fill open firefighter/emergency medical services positions, according to the executive summary.
The city can increase its cash reserves because the strong economy from last July through February generated more income than expected and because, in past years, the budget has been austere and one-time money went to infrastructure instead of projects with recurring or unknown costs, Wells wrote.
As for expenditures, in February, Municipal Judge Robert Cook submitted his proposed budget to the governing body, as per city charter, and requested a funding increase of about $19,000. That request is included in the budget.
The recommended budget also includes:
• About $133,000 to cover 25 percent of the cost two new police officer positions; officials hope to get a federal grant to cover 75 percent of the expenses for three years.
• Transfer of expenses of the Rio Cares program EMS provider into the general fund to continue sending that person to work with frequent 911 callers to try to alleviate the need for so many calls; Wells expects reimbursements from health-care providers to cover the costs.
• $125,000 for an enhanced maintenance contract to protect against system failure of emergency communications radio infrastructure.
• $5,000 to establish recurring funding for the Rio Rancho Police and Fire Rescue departments’ chaplain programs.
• $48,600 of matching money to secure a $2.3 million federal grant for design and right-of-way acquisition to widen Northern Boulevard from Broadmoor Boulevard to Unser Boulevard.
• $122,000 for drainage-system improvements to discharge points and related engineering.
• $113,000 in matching money to secure a $665,000 federal grant for a walkway along Westside Boulevard.
• $1.42 million of extra money from this year’s budget to improve King Boulevard from Unser to Wilpett Drive and install utilities there.
• $250,000 for crack patching and sealing of 10 miles of neighborhood streets.
• $85,000 for sidewalk and wall repairs throughout the city.
• $105,000 to replace three heat exchangers at the Rio Rancho Aquatics Center.
• $35,000 for a feasibility study and analysis of a possible multipurpose recreational facility in Enchanted Hills.
• $10,000 for a city comprehensive plan update.
• $15,000 for Development Services Department customer-service training.
• $235,000 to replace six vehicles or pieces of heavy equipment in several departments.
• $39,000 for surveillance cameras at City Hall.
• $82,000 for consulting services to identify and lessen cyber security risks.
Wells wrote that before the pandemic, he had intended to recommend 2 percent raises for all city employees and bringing salaries among American Federation of State, County & Municipal Employees union members to more competitive levels. He advised the governing body take action in those areas as soon as possible after the economic affects of the pandemic were known.
To view the full proposed city budget, visit rrnm.gov/165/Budget-Reports-Information.