County facing $24M general fund shortfall

COVID-19 pandemic named as principal reason for deficit

When Bernalillo County in April passed its fiscal year 2021 budget, county government was expected to grow — the budget featured dozens of new positions and raised general fund spending by nearly 7%.

But new revenue forecasts have forced a change of plans.

The county commission on Tuesday amended its budget to account for a $24 million shortfall in the general fund — the “direct result of the projected revenue losses related to the worldwide COVID-19 pandemic,” according to a county budget memo.

Despite the adjustment, the county does not intend to lay off or furlough any existing workers or to make changes the public would notice, its top finance official said.

“We haven’t cut services or reduced any of our critical services at all, and nor is that the plan. It’s always been our priority not to do that or adversely affect employees,” Shirley Ragin, deputy county manager for finance, said in an interview.

The budget adjustment assumes $316 million in general fund revenue in the fiscal year that began July 1. That’s compared with the $340 million expected when the commission originally approved the budget on April 14. New Mexico at that time was about a month into the COVID-19 pandemic, and the extent of its financial toll remained unknown. Officials said then they were prepared to make changes later, if necessary.

Now that the county has months of data and economists have had time to study, Ragin said the county is predicting 10% less in gross receipts tax and 5% less in property tax than when it prepared the

original budget.

The new budget bridges the gap in a few ways, including lowered personnel costs. Not only has the county delayed hiring the 34 new positions built into the original 2021 budget, it has also frozen over 50 existing positions across county government for at least part of the year. The county is also registering about $5.1 million in “general county savings,” which Ragin said reflects everything from less employee travel to reduced office supply costs.

Most notably, the county is applying about $14.5 million in unspent funding from the last fiscal year, a carry-over that Ragin said prevented much more significant cuts.

The last fiscal year ended June 30, and the county had at that point largely avoided catastrophic financial losses due to COVID-19. In fact, the county concluded the year with more gross receipts tax — a tax assessed on the sale of nearly every good and service — than it had planned for, in part because the economy had been riding so high just prior to the pandemic, Ragin said, and because the county budgets conservatively.

Two new ordinances

Also on Tuesday, the commission approved two new ordinances: one requiring a community workforce agreement on major county construction projects and another that establishes a “Sheriff’s Office Advisory and Review Board.” Each passed 4-1, with Jim Collie, Debbie O’Malley, Charlene Pyskoty and Steven Michael Quezada in favor and Lonnie Talbert opposed.

The community workforce ordinance would ensure union involvement on county public works projects that cost at least $7 million and have workers from at least three crafts.

Contractors selected for the biggest county jobs would have to sign onto a community workforce agreement, also known as a project labor agreement, that mandates a certain level of union worker participation on the job.

Nonunion contractors can still win the projects and bring some of their existing workers into the job, but most workers on the site would have to pay union dues for their time on the project. Nonunion contractors bringing their own personnel would also have to make fringe benefit contributions to the union for those workers unless they already offered them health insurance, vacation and some sort of retirement benefit.

O’Malley, who co-sponsored the bill with Collie, said the goal was for all people working on the sites to have benefits such as health insurance, although critics have argued that the ordinance primarily benefits the unions, which only represent a fraction of the state’s construction workforce.

Quezada — who repeatedly cited his own positive experience as a member of an actors union — successfully sponsored an amendment that raised the threshold for applicable projects to $7 million, up from the originally proposed $5 million. He called it a “fair compromise.”

Officials said Tuesday only three county projects since 2018 have reached that threshold.

Pyskoty asked the county attorney to add language that would ensure the agreements prioritized local workers.

The second new ordinance, meanwhile, will establish a new advisory board for the Bernalillo County Sheriff’s Office. The county commissioners will appoint the board’s nine members, who can investigate BCSO policies and procedures, authorize outside audits of the department’s policies or procedures, request information, such as completed internal affairs investigations, and make recommendations to both BCSO and the County Commission.

Collie, who sponsored the ordinance, said it was not intended to oppose the Sheriff’s Office but to foster a public dialogue.

“What this does is create a place in which the kind of necessary transparency can occur in a public environment,” he said.