Portales to consider tax increase

PORTALES — City residents could see a gross receipts tax increase of up to 0.6125 percent this year after the city council adopted a notice of intent to consider it during a regular meeting Tuesday.

If the max amount of 0.6125 percent is approved, it would add an additional 61 cents in tax to a $100 purchase and generate an estimated $1,335,250 in annual revenue for the city according to Portales Finance Director Marilyn Rapp.

City Manager Sammy Standefer said after the city had calculated its final predicted budget for last year it observed that it had depleted its reserves by $1.451 million.

While that might not be the final amount after taking into several variables like salaries, Standefer stated the amount was alarming and unsustainable.

Standefer said the city would either have to find a way to increase revenue or find expenditures to decrease. He said the options to increase revenue would be to increase city service prices, increase GRT or increase property tax. Expenditures could include cuts to city services.

Standefer added that the state Legislature also recently changed how tax increase are adopted, getting rid of specific percentages of GRT being earmarked for specific uses and leaving it up to individual municipalities to decide where the money should go. With the earmarks gone, the city has a 0.6125 increase available.

For such an increase to take effect, an ordinance would need to be adopted by March 31, prompting Standefer to bring a notice of intent to the council now and leave more in-depth discussion for later.

Standefer urged the council to set a special meeting after March 20 so the city could be aware of any new legislation approved by the governor that may affect the decision.

The council has a regular meeting on March 17, but went ahead and scheduled a special meeting to discuss the issue on March 24 at 6:30 p.m.

“We're in a struggle. To maintain the path we're on is unsustainable and we just need to make some changes,” Standefer said.

Council member Jessica Yi said cutting city services would be a poor option as one of the city's highest priorities include ongoing road repairs, which would be affected. The city will also be looking to staff its new fire department on the north side of the city.

Other highlights from the Tuesday evening meeting at the Memorial building include:

• Feb. 7 to Feb. 14 was declared “Congenital Heart Defect Awareness” week in Portales.

• The council ratified bills for December 2019 for $1,615,716.27. The council also adopted several quarter and mid-year budget adjustments.

• The council approved a change order on the Johnson Hill West Tank project for additional equipment for the chlorination system. The net value of the change will be $16,391.92.

• The council ratified four amendments and approved a fifth to a contract with CDM Smith for Environmental Compliance at the wastewater treatment plant and landfill. The amended contract will cost $135,191.11, including GRT.

• The council approved an application for a grant agreement resolution for maintenance work on the taxiway at the Portales Municipal Airport for next year.

• The council approved a list of poll workers and set remuneration for the March 3 Municipal Officer Election.