County expects $1.2 million budget deficit

August 21, 2009

Valencia County will end this fiscal year in July 2010 in the black, but a financial analysis by finance officials show an expected budget deficit of approximately $1.2 million in the following fiscal year.

“Currently, with the revenues the way they’ve been coming in,” said Business Manager Kenny Griego, “this is with property values staying pretty much where they are at, projected gross receipts staying low, we are projecting probably about a $1.2 million deficit in our budget.”

Because the county’s sources of revenue, like construction permits and gross receipts, remain lower than normal, the county could experience a deficit.

Griego was optimistic that the deficit could be brought down from the “rough estimate” of $1.2 million if the county can resolve several areas of high expense during this fiscal year that won’t carry over as expenses for the next fiscal year.

He also stressed the need to control and reduce spending where possible, calling on departments to continue being “fiscally responsible.”

“Right now, we are in what’s called deficit spending,” he said.

He said the county ended last fiscal year with a nearly $660,000 surplus. The county is slowly chipping away at it to make up for its uncharacteristically low revenues. Officials have projected the county will have an approximately $170,000 surplus at the end of this fiscal year.

“We’re not overspending. We’re not being extravagant in anything that we’re doing,” he said. “It’s just that we’re just eating away at what cash balance we do have. Because the other revenues are not coming in, this is what’s making it extremely hard.”

The State of New Mexico is projecting more than a half billion dollar deficit in its own budget, which Griego believes will affect the county. He’s expecting cuts in state allocations to the county.

Commissioners reacted mostly with stunned silence.

“It’s always good to know that far out how we stand,” said Commissioner Don Holliday.

“I would like to hear once a month on how these projections are coming along,” said Commission Chairman Pedro Rael. “We’d appreciate that, because if the commission needs to take action, we need to be informed and ready to do whatever we need to do so we don’t start having severe shortfalls.”

The county will have a better grasp on the seriousness of the deficit in January, when the Budget and Finance Office presents a mid-year report.

Posted in: Archive