Belen’s 2020-21 fiscal budget is healthier than initially expected

BELEN—What could have been a disastrous fiscal conundrum for the city of Belen turned into an unexpected cash flow.

Restrictions for large and small businesses continued throughout the state due to the COVID-19 pandemic forcing city officials to tighten their belts and wait for gross receipts taxes to plunge.

The New Mexico Department of Finance and Administration warned all cities and counties in New Mexico to expect the worst when it came to GRT revenue, and advised them to submit flat budgets for the 2020-21 fiscal year that began in July.

Roseann Peralta, Belen’s finance director and interim manager, said the city did just that — and more.

“They gave us the option of submitting the current year’s budget, and make that as our interim budget, and that’s what we did because we didn’t know what was going to happen,” Peralta said. “Later on, they were telling us to cut back 25 percent the first quarter and 20 percent the second quarter.”

As the city began its budgeting process, they put the brakes on its spending by not hiring new employees and only approving necessary purchases.

“It worked out well. We didn’t have any huge cuts in services,” Peralta said. “We saved some money in operational costs but not employees — we didn’t furlough anyone.”

Anticipating a hit in GRT revenues, Peralta said she was pleasantly surprised when the city received the May GRT distribution — $621,291 — compared to $536,400 in 2019. Belen’s June GRT distribution was even better — $746,449. In June 2019, the distribution was $449,221.

“I think this really showed us what the citizens of Belen can really do by spending money here,” Peralta said. “We’re very different from Los Lunas in that they get a lot of their gross receipts from retail stores and car dealerships and other sources that we don’t have. While it’s sad to say we don’t have those, we can also say that (the loss of that GRT) didn’t affect us.

“With the closures everywhere, the residents had to shop here,” she said. “We had people come in and tell us that they’d never been to Ace Hardware, the dollar stores were always packed, and from what I understand, Lowe’s grocery had the best months they’ve ever had.”

Peralta also thinks the initial hoarding phase of the pandemic only helped with the city’s GRT revenues, as well as the federal government stimulus checks and extra unemployment money.

What helped this year, Peralta said, was that the city kept moving through it, and businesses did what they could to make sure they provided goods and services.

“It was an opportunity for citizens to see what Belen was about and has to offer,” she said. “For a lot of residents, they drive down Main Street, get on the interstate and go to Albuquerque or Los Lunas and they didn’t see what we had here.

“We also had a great push of shopping local, support local businesses,” she said. “People had the opportunity to shop at stores they hadn’t been to before, get takeout from restaurants they hadn’t been to in a long time. It was a great community effort.”

As the pandemic continued, the city’s GRT also continued to increase. The city collected $686,456 in GRT in July, compared to $461,808 the year before.

When it came time to submit the city’s final budget at the end of July with the new GRT revenues, Peralta said there were some increases in the budget but not very large ones, with the understanding the pandemic isn’t over and no one knows how and when it will effect the economy.

In the new budget, which is projected to have $25,568,275 in revenues (including its enterprise funds), and $24,228,167 in expenditures, doesn’t contain funding for additional staff or pay increases for employees, although the council could look at the budget mid-year and may consider raises then, Peralta said.

The city has put some money aside for ongoing projects, such as the sewer line and grinder pumps for the Campana/Ross neighborhood, and a match for the Great Blocks on MainStreet project, which consists of partial sidewalk and asphalt rehabilitation, the addition of streetlights, and new landscaping, including trees, at the east end of Becker Avenue between First and Second Streets.

One of the larger projects the city is working toward is the rehabilitation and reconstruction of Aragon Road from Mesa to Main streets, which will cost city taxpayers $326,000 in matching funds. The construction is expected to cost $1.8 million.

When the Legislature met in June, they did take some funding away from some capital outlay projects in the Hub City, including money for the redesign of a turning lane at Don Luis Trujillo and the I-25 Bypass, funding for additional parking at the Belen Senior Center and the waterline construction project on Aragon Road, which Peralta said they’re applying for additional funding.

Other projects the city does have capital outlay funding in its budget for include renovations for the old Belen City Hall ($95,000) and the water tower ($65,000), rehabilitation of the roof at the Belen Harvey House Museum ($165,000), and phase three of the Belen Veterans Memorial ($350,000).

“We were very conservative in how we created this budget,” Peralta said. “The mayor said we didn’t know what was coming at us, and we needed to be very careful with this budget.”

Now in September, Peralta said they will reevaluate their financial status and maybe start smaller, road improvement projects.

The city’s ending cash balance for the 2019-20 fiscal year was $1,563,561, which is the best it’s seen in a while, Peralta says. While she’s happy with the increase of funds, she is still hesitant about spending the surplus during this time, saying no one knows what the future holds.