Officials describe hardships caused by declining gross receipts taxes over the past few years

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FARMINGTON — This year's Leadership San Juan class is nearing the end of its program, and one of the group's final sessions was held Friday at McGee Park.

Government Day featured leaders from various government agencies around the county talking about various aspects of government to the emerging leaders that make up the class.

Mike Stark, San Juan County operations officer, kicked off Friday's class by presenting an overview of local government funding.

"I enjoy this session because it provides the opportunity to show how local government operates, and why and how we do the things we do," Stark told the group. "It's important for you to know how your money is being spent."

Stark talked about some unique aspects of San Juan County, one of those being that only 6.5 percent of the land in the county is privately owned. Sixty-five percent of county land is part of a Native American reservation (Navajo Nation or Ute Mountain), 25 percent is federally owned, and the remaining 3.5 percent is owned by the state.

Stark stressed the importance of gross receipts tax and federal grant funding for the county, especially in light of Trump administration budget proposals to eliminate many block grants.

"If we lose block grants and (payments in lieu of taxes) funding, that would be a big blow to the county," he said.

The possible loss of one or both coal-powered plants in the county would have a huge negative impact locally, Stark said.

"When you look at the creation of jobs in our country, much of that is attributable to the two coal-powered plants. It would be a huge loss for the county if we lose the plants," he said. "It would be a huge loss in property tax, and a loss of 1,400 indirect jobs. Although there are other good energy projects on the horizon, we'd never be able to replace the jobs that would be lost."

Stark said that now is a good time for those who want to have input into how local governments spend their money to speak up.

"All local governments are now formulating their budgets and are looking for feedback," he said. "It's a good time to provide your input, and if you want to know something, you just need to ask — there are no secrets because most local government information is a matter of public record."

Nine county and city officials, including mayors from Aztec, Kirtland and Bloomfield, sat down for a panel discussion to address "hot topics" and answer class members' questions.

All the officials stated that a decline gross receipts taxes over the last few years has caused them to tighten budgets and find creative ways to operate more efficiently.

"Basically, we've been doing a lot of analysis," San Juan County CEO Kim Carpenter said. "We work closely with industries and city officials to track the trends."

Carpenter said the county has always taken a conservative approach to budget issues, but he said working with less has proven to be a challenge, especially with 95 percent of extraction-related industry in the county being in the natural gas sector and gas prices remaining so low.

"We are looking at anticipated gas prices, and we don't see numbers starting to climb much at all," he said.

City managers for Bloomfield and Aztec expressed similar views, as did Farmington City Manager Rob Mayes.

"When we look at ourselves today compared with how we were in 2009, we can't even recognize ourselves," he said. "Our world changed in 2009 and 2010. We've seen a gradual recovery mixed with many busts, but we're still living with 28 percent less revenue than we had in 2009."

Mayes said the city has adjusted to the challenging financial environment by limiting its work force and adapting to new technology.

"We don't need a boom to be healthy, but we need to recover more from the last bust of 2014," he said. "I think we will be able to recover if we continue to budget conservatively."

Leigh Black Irvin is the business editor for The Daily Times. She can be reached at 505-564-4621.

More information

Leadership San Juan is accepting applications for the class of 2018, said Nancy Shepherd, one of the founders and organizers of the organization. The program consists of nine day-long class sessions throughout the year featuring topics important to the county such as criminal justice, education, and health and human services. In addition to attending these sessions, class members complete projects that benefit the community. Shepherd said applications for next year's class are due May 15. "We encourage people to get their applications in early," Shepherd said. "It helps us know which other sectors of the population we're missing so we can focus our recruitment efforts better. This program really is a vital part of building a foundation of leadership within the county." For more information on Leadership San Juan or to apply, visit sanjuancollege.edu/community/departments/leadership-san-juan or call Shepherd at 505-320-2236.

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