A proposed 15 percent water rate increase was approved Thursday as part of the city’s preliminary budget by the Tucumcari City Commission, which came under criticism for not allowing public comment.
The increase was needed to balance the preliminary $11.79 million operating budget, excluding grants and projects, and to get the budget off to Santa Fe to meet the state’s Department of Finance and Administration June 1 deadline, said Marty Garcia, city finance director.
The 15 percent rate increase would bring in $175,000 to balance the budget, Garcia said.
“If we dont’ have any problems, we can always go back and change the budget,” Garcia said.
Commissioner Jim Lafferty said that any rate increase needed to have a public hearing. “I’m disappointed that the night before the budget is due that we are discussing a rate increase,” Lafferty said.
Because the details of a city ordinance on water rate increases had not been studied, “You are going against you’re own recommnedations .. and you need to change the city ordindance,” Tucumcari City Manager Bobbye Rose told the commission.
“The system is broken from the bottom to the top,” said Rose.
Rose recommended the city hold a series of workshops to determine if a rate increase was necessary. Rose also said the workshops could help determine if the commission needed to change ordinances regarding rate increases.
As part of its approval of the preliminary budget, city commissioners said they would review any rate increases at future workshops.
The preliminary budget also included about a 15 percent increase in health insurance costs for employees enrolled in the program. The coverage includes employees and their family members.
The city provides 100 percent health insurance coverage, meaning employees do not pay into the program. Those costs accounted for $924,982 in the approved preliminary budget compared to $810,360 for last year’s budget.
Of the city’s 136 employees, which includes some part-timers, 65 percent or 89 employees participate in the health insurance program.
Overall, the city’s salaries account for $3.420 million.
Because the fiscal year does not end until June 30, the city’s budget deficit may level off some when fiscal year cash balances and receipts are reconciled, Garcia said.
On Friday, Garcia said, he expected the 15 percent rate increase “to stay unless they do something drastic to the operating budget.”
The city’s overall budget is $13.5 million, inculding grants and projects. Not yet added to the budget is $8 million in loans and grants that are expected to come from the USDA for the city’s wastewater project. This compares to an overall budget of $21.82 million last fiscal year.
The DFA requires a preminlinary budget be sent to them by June 1 for approval.
The final budget is completed after cash balances have been reconciled usually by 30 days/month after the fiscal year ends June 30. The DFA also approves the final budget.
The commission has scheduled a workshop for 5 p.m. on June 8.