Voters Have No Say in 3/16ths Cent Increase
Related Story: Few Taxpayers Appear to Know BernCo Tax Increase is Coming
Bernalillo County government’s appetite for your money seems insatiable.
Just two years ago, the Bernalillo County Commission rifled taxpayers’ pockets by increasing the gross receipts by $30 million.
Now, the county is at it again, looking for another $30 million of your money in the form of another gross receipts tax increase.
If the Bernalillo County Commission approves the latest request for a three-sixteenths-of-a-cent GRT increase, it would send the GRT rate in Albuquerque to 7.5 percent – a double-digit increase from 2010 when it was 6.625 percent. That would represent $140 million in tax increases levied within both the city and the county since 2010.
Both the county’s overall spending and its payroll have swelled dramatically since 2009.
The growth has occurred despite the fact that the metro area’s economy and population have been stagnant. The area has yet to recover all the jobs it lost during the recession, and in the past few years it has seen a net outmigration of people.
So why does the county need an additional $30 million?
“Increases in expenses are outpacing revenue growth,” a county manager who asked not to be identified told ABQ Free Press Weekly. “There are many unfunded mandates that the county hasn’t done as it lives within its recurring budget. State and federal funding is steadily decreasing [and] placing a greater burden on the general fund.”
Some of those rising expenses include healthcare and workers’ compensation insurance premiums, maintenance for county buildings, and replacing things such as computer software.
What will happen if the five-member commission doesn’t approve the $30 million tax increase?
“Compromised service delivery and high costs associated with maintenance and repair due to increased damage resulting from extraordinary deferral of maintenance and increased cost of goods and services for the maintenance and or repair [of those facilities],” the manager said.
Another thing is clear about the proposed $30 million tax hike: Taxpayers really don’t have a say about it. As it did in 2015, the County Commission can approve the increase whether voters like it or not.
Clear as mud
The authority to raise taxes that the county wants to use was granted by the Legislature when state government began a 15-year phased elimination of the GRT on food and medicine in 2013.
To prevent counties that had relied on those revenues from being harmed, the Legislature gave them the power – on their own say-so – to incrementally increase GRT up to three-sixteenths of a cent over a period of years to keep their revenue stream steady.
But rather than raise taxes slowly, the County Commission wants to use all of its taxing authority all at once.
That has Commissioner Wayne Johnson, a Republican, crying foul.
Johnson said the county would be getting a windfall by getting new money while still getting what’s called “hold harmless” money from the state – a revenue stream that, while dwindling, will continue for 13 more years.
Johnson said the county needs to rein in its spending before hiking taxes again.
“It’s just wrong [to raise taxes]. As a small business owner, I can’t make you buy more of my products if I need more revenue,” Johnson said. “But the county can make you pay. That is fundamentally wrong.”
Commissioner Debbie O’Malley, a Democrat, said she is leaning toward approving the proposed tax hike. With Democrats holding a 3-2 majority on the commission, it’s likely some kind of increase will be approved.
“I’m leaning toward it,” O’Malley said. “It will help a great deal to know what will happen if we don’t get the money. Will we have to lay people off? Well, who and where?”
Dennis Domrzalski is an associate editor at ABQ Free Press Weekly.
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