The Eastern New Mexico News - Serving Clovis, Portales and the Surrounding Communities

Portales council meeting canceled

 

March 25, 2020



PORTALES — A Portales City Council meeting scheduled for Tuesday on whether or not to approve a tax hike was canceled after a new public health order from the governor.

The hearing would have allowed the public to speak before the council decided whether or not to raise local gross receipts tax by up to 0.6125 percent.

For now, the meeting has been canceled to comply with Gov. Michelle Lujan Grisham's order Monday to limit gatherings to five or less people. A new date to readdress the issue has not been set, but Portales City Clerk Joan Martinez-Terry said the council will likely have to wait and try again in October.

The current GRT rate in Portales is 1.5625 percent for the city and 8.1875 total with the county and state. The maximum amount of the increase would add 61 cents in sales tax to a $100 purchase and is expected to generate $1,335,250 in annual revenue for the city, according to Portales Finance Director Marilyn Rapp.

During a January meeting discussing the increase, City Manager Sammy Standefer said the city had calculated its final predicted budget for last year and observed that it had depleted its reserves by $1.451 million. This follows the phasing out of hold harmless GRT funds introduced to alleviate the financial impact of previous GRT cuts.

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

Standefer added that the state Legislature also recently changed how tax increases 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 the increase to take effect by July, an ordinance would have needed to be adopted by March 31.

Alternatives to a GRT increase would likely be to cut city services, which would affect ongoing roadwork and could cause problems staffing the new fire station, officials said.

 
 

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