City anticipates spending $286 million in FY 2019

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FARMINGTON — The largest portions of Farmington's fiscal year 2019 budget will be spent on police and parks, according to the preliminary budget.

About 25 percent of the $60.8 million in expenditures from the general fund will be spent on the police department. The parks department will receive 19 percent. Public Works will spend 15 percent and the fire department will receive about 12 percent.

The City Council reviewed the preliminary budget during a work session Tuesday.

City Manager Rob Mayes said the budget is an important management tool that guides policy decisions and takes about six months to complete.

The general fund provides money that the city can spend at its discretion. Other funds in the city are dedicated to certain uses, such as streets or parks.

The preliminary budget calls for spending $286 million in fiscal year 2019. That is a decrease of about $30 million from fiscal year 2018.

Mayes showed a pie graph of anticipated expenditures during the meeting.

"The council picks how big the pie is, and the council picks where the slices are," he said.

He said past councils also have chosen to invest in public safety and parks.

"I think essentially the pie as it is cut is pretty much the required distributions to maintain the level of services that we have," he said.

Revenue comes from gross receipts tax

The main source of revenue for the city of Farmington is gross receipts tax followed by the Farmington Electric Utility System. The electric utility provides about 7 percent of the city's revenue, according to the preliminary budget presentation.

"We have most of our eggs in the GRT basket, and that makes sense because the net burden is shared by a much broader tax base," Mayes said.

He explained people come to shop in Farmington from the entire Four Corners region.

Farmington's gross receipts tax rate is 7.625 percent. Mayes said that 7.625 percent is made up of tax increments from the city, state and county. Farmington has enacted a 2.6 percent gross receipts tax. The largest share of the 7.625 percent gross receipts tax goes to the state.

For each dollar of revenue generated by the tax, the city receives 35 cents, the county receives 14 cents and the state receives 51 cents, according to Mayes.

The city is projecting a 5 percent increase in gross receipts tax revenue in fiscal year 2019 based on the trends seen this fiscal year.

 

Budget pays for a variety of services

Many Farmington services do not bring in enough revenue to cover their expenses. Mayes said the municipal court is one of those services.

"If we wanted to save money, we would write no tickets and close municipal court," he said.

The city likely will spend $1.2 million in fiscal year 2019 on the municipal court, which is approximately a 22 percent subsidy of the service.

The Farmington Public Library receives $17,800 from fines and fees and about $10,000 from the county. The rest of its expenses must be covered by the city of Farmington. The preliminary budget calls for $4.2 million from the city.

"They seem to do a lot with $4 million," Councilor Sean Sharer commented.

The city-owned golf courses also will require the city to pay for some of their expenses.

"Golf courses don't make money," Mayes said.

Piñon Hills Golf Course will require about $240,000 and Civitan Golf Course will need about $76,000 to cover expenses that aren't met by their revenue.

City manager says Farmington must plan for future

After the final budget is adopted, Mayes said the city will need to discuss a financial plan for the next five years. He said those discussions likely will occur in August.

"The revenue tax base that we have in the future will not be able to maintain the same levels of services that we have," he said.

The full meeting can be viewed online at fmtn.org.

Hannah Grover covers government for The Daily Times. She can be reached at 505-564-4652 or via email at hgrover@daily-times.com.

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