Shoppers not likely to save city budget

ALBUQUERQUE (KRQE) - Unless the economy turns around and fast the city of Albuquerque could have a budget shortfall almost double the projection of just a few weeks ago.

Two city councilors said cuts will be inevitable. How much holiday shopping people do in Albuquerque will have an affect on how bad things actually get.

It's something Councilor Ken Sanchez said he hopes the city can turn around. But as it looks right now the city's budget shortfall is growing as gross-receipts taxes, commonly called sales taxes, continue their downward slide.

“So our GRT is down about 8 percent from this time last year,” councilor financial adviser Jon Zaman said.

Zaman said for every drop of 1 percentage point represents $3 million which comes out to shortfall projection of $24 million.

“It’s growing as the gross receipts taxes aren't coming in as we projected,” Sanchez said.

Now councilors are worried, and while the budget crunch does not necessarily mean layoffs, councilors are looking at where the city could cut.

“I think the last thing that we would let would be public-safety positions, police and fire," Sanchez said. "We've got to make sure the garbage is picked up that the roads are maintained."

For city revenue to pick up people need to start spending, he added. However this year’s holiday season may be as dismal for retailers as last year especially given the unemployment rate in the city is close to 8.5 percent, Sanchez said.

“With that many people unemployed I think it's going to be dismal year,” he said.

Cathy Bertetto is one of those unemployed residents, and like a lot of people this holiday she'll be scaling back. Her friend is also being cautious.

“I know what my budget is, and I know what I can spend,” Bertetto said.

“I've got a child that's been unemployed for about a year and just picked up some seasonal work," added Angela Manning. "It's tough out there."

The city's Economic Development Department doesn't expect to see more jobs in Albuquerque for at least a year.

Bertetto said she wants to help out more but she can only do so much.

“We just can’t afford it," she said. "I need to make my house payment first.”

Councilors said vacancies in the city payroll would be the first to go. They will look at the budget again come January.

Mayor Martin Chávez, who leaves office Dec. 1, said he thinks the projections are too grim and that layoffs or furloughs won't be necessary.

Incoming Mayor Richard Berry said the budget shortfall is obviously the biggest issue facing his administration but can't say yet if layoffs or furloughs will be necessary.

Almost half of the city's $475 million budget goes to the police and fire departments.