RIO COMMUNITIES — Residential property owners in Rio Communities preparing for a tax hike later this year will no longer have to — at least for now.
The Rio Communities City Council unanimously voted to rescind the 3.5 mill levy on residential property owners it had enacted on Monday, July 25. The mill levy was to pay for a new police department, with a police chief, two police officers and an evidence technician.
The decision to rescind the mill levy was made after Rio Communities City Manager Martin Moore recommended the action. The mill levy was expected to bring in an estimated $273,000 per year for the police department.
During the special meeting, held Saturday night, Moore told the council he was informed by the New Mexico Department of Finance and Administration last Wednesday the city, per state statute, cannot impose a mill levy on residential property owners without imposing the same rate to commercial property owners.
“As a result of that, we immediately called (DFA) and reminded them we went through this, and everything was fine and the budget had been approved,” Moore said. “They said, ‘It was an oversight on our part.’”
Moore said before the council approved the mill levy, they made it clear to “the commercial side” the city wasn’t going to increase their property tax.
“It’s a difficult wrestling match because of the desires to have a police department, but at the same time, there’s the matter of we gave our word,” Moore said. “Giving our word and keeping our word is something of significance.
“If we give our word to the residents, especially of something of this importance, it is important to keep our word.”
The city manager said the bureau chief at DFA told him the city has two options — to leave it alone and the property tax rate would go up for both residential and commercial property owners or the council can vote to rescind the mill levy.
The consequence of rescinding the mill levy is to downsize what the city wanted in its initial police department. Moore said he and staff have been looking through the budget and will present options to the council at future meetings.
“We will be proposing a police chief and one police officer, initially, and recommending at the mid-year budget and at the beginning of 2023-24 budget bringing on another officer,” Moore said.
The city manager also said staff will be looking over finances and possibly recommending:
The current budget has a line item for the police chief’s salary, which covers the full 12 months of the fiscal year (July 2022-June 2023). Moore will be asking the council to cut it in half with a hiring date of January 2023.
Will recommend trimming more than $34,000 of the code enforcement budget. The manager said the staff will be cut, leaving two people instead of four, it won’t affect the fire chief’s role in the department.
Utilize the third member in the municipal clerk’s office to take care of library services instead of hiring a part-time librarian.
The budget for street lights and street repair can be cut in half from $60,000 to $30,000.
The police start-up cost will decreased from $200,000 to $150,000.
“These are some suggestions we have … without affecting base operations,” Moore said. “Part of that is we have an expiring contract with the sheriff’s office in June 2023.”
Councilor Art Apodaca questioned why the city was willing to rescind the mill levy just because commercial property owners would have to pay more in taxes.
“I’m giving you a recommendation based on a couple of things,” Moore told the councilor. “In talking with a couple of business owners … there is significant concern for a reduction of economic activity if we were to raise commercial property taxes. We already said we weren’t going to do that.”
Moore estimated if commercial property owners did pay the 3.5 mill increase, the city would receive between $50,000-$80,000 per year in revenue.
If the council had enacted the mill levy on businesses, Moore said there would be a, “… very real possibility of a decrease in business, or a dampening factor in recruiting additional businesses to the city of Rio Communities.”
Councilor Peggy Gujahr said the council had to make the decision quickly because the state needed the decision by Monday.
“We can always, as a council, revisit a mill levy,” Gutjahr said. “I know that (businesses) who wanted to come in here to develop were coming in at the rate we currently have.”
Gutjahr said the council can look at another mill levy at mid year and again before the next fiscal year.
“When you promise something, you have to stick to it,” she said. “My concern is for the library. Funding comes with having a certified librarian.”
“From my perspective, none of us wants to have increased taxes,” Apodaca said. “It’s never popular. We made a promise to businesses, and we made another promise to the community — a police department.
“It’s really a tough situation,” he added. “I wish we had more data about how much it would cost the businesses; how much of an increase they would have in property taxes.”
Rio Communities Mayor Joshua Ramsell said while this might be a setback, the city is still on a path toward a police department.
“The chief will be a working chief, and we’re just delaying hiring a second officer by three months,” Ramsell said. “We’re also looking at how revenues have been trending with opening of new businesses. We’ll have increases in our (gross receipts taxes).
“As members of this community, we can talk to those businesses and ask them what is it worth to them to have a full-time police force,” the mayor said. “They might be a little more willing.”
In other business, the council approved a resolution to start the process of applying for a loan with the New Mexico Finance Authority for police vehicles.
“This does not commit the city to purchase vehicles or for the loan,” Moore said. “If we continue to feel we need new vehicles, this will be able to help us pay for them.”
Moore said he is hoping to be able to purchase SUV-type vehicles for the yet-to-be established police department.
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