Bloomfield ponders options for budget shortfall

Hannah Grover

BLOOMFIELD – City officials here are exploring various possibilities for saving money as they draft a preliminary budget for fiscal year 2017.

During a work session Tuesday evening, City Manager Eric Strahl told council members that the city could face a $600,000 shortfall in the general fund due to a decrease in gross tax receipts.

"We really don't know one way or the other what's going to happen with the GRT," Strahl said.

Strahl presented several options to the council, including furloughs, changes in employees' insurance, keeping vacant positions open wherever possible and cutting back the hours of operation at the Bloomfield Family Aquatic Center.

"There's no real easy answer to the whole thing," he said.

Councilor Matt Pennington said the department heads should look at the budget and how each department could save money. He said he does not think a blanket approach could work for all departments.

After the meeting, Finance Director Brad Ellsworth said the last time the city was forced to cut the budget was in fiscal year 2012 when natural gas prices declined significantly. Ellsworth said at the time natural gas was the main economic activity in Bloomfield. Increased oil development over the past few years helped pull the city out of that budget crisis, but now the oil industry is laying off workers.

Ellsworth said in 2012, there were several positions in the city that remained vacant as part of an effort to save money.

"I think right now we're just kind of putting a (bandage) on the situation," he said.

The annexation of 6,775 acres in 2014 was expected to bring significant additional tax revenue to the city. But after the meeting, Strahl said annexing that land was a trade-off because the companies operating on the land already were paying the city money for services such as fire protection. Once the land was annexed, those payments stopped and, when the oil industry slowed its production, the GRT revenue went down.

Strahl told councilors that the city also needs to find a way to bring in more revenue.

"Nobody wants to increase property tax, but I think we are going to have to look at utility rates," he said.

Strahl said for three of the past five years, the expense of running the sewer and water utilities has exceeded the revenues. Aging infrastructure also could present problems in the future. The city is currently seeking funding to build a new waste water treatment plant, because the current plan is showing signs of structural failure partially due to its age, according to The Daily Times archives.

"If something major happens, the issue will be, do we have enough to cover it?" Strahl said.

Hannah Grover covers Aztec and Bloomfield, as well as general news, for The Daily Times. She can be reached at 505-564-4652.