Los Alamos County Council from left, Council Vice Chair Theresa Cull, Chair Denise Derkcas, Councilor Keith Lepsch, Councilor Melanee Hand, Councilor Randall Ryti, Councilor Suzie Havemann and Councilor David Reagor. Courtesy/LAC

By KIRSTEN LASKEY
Los Alamos Daily Post
kirsten@ladailypost.com

After three days of hearings and discussions, the Los Alamos County’s budget for Fiscal Year (FY) 2025 is approved.

Tuesday night, County Council approved 6-1, with Councilor David Reagor opposed, a budget that totals $377,473,225. In addition, council approved the following: the long-range financial projection, the equipment replacement schedule, the recurring grants schedule, the summary of pension fund and administrative costs, the schedule of appropriations for salary adjustments, the Department of Public Utilities’ schedule of funds and continuing of appropriations in the FY 2025 budget from the FY 2024 budget.

Earlier in the hearing, while discussing several budget options, Reagor objected to funding any new full-time employment (FTE) positions, citing projections showing shrinking revenue in future fiscal years due to Los Alamos National Laboratory paying less in Gross Receipt Tax (GRT). Rather than using those funds that might in danger to pay for FTEs, he said the money should be put into the capital improvement fund.
Further, he chastised his fellow councilors for making sweeping approvals on the County’s budget recommendations.

“I just want to point out that all of you are potted plants … you just approved everything staff put together, it’s like council doesn’t even have to be here,” Reagor said. “You just go down the line, approve every single thing … you don’t even need council … you just raise your hand, vote yes to everything. I just wished you had a little more thinking about what’s good for the long-term county budget… at least do a little more probing of what’s being presented …”

Not everyone on council shared this view.

“We just spent 12 hours discussing the budget and budget options and I feel pretty confident that county staff and our new county manager have justified the expenditures that have been presented…,” Council Vice Chair Theresa Cull said.

Councilor Suzie Havemann said while she could understand where Reagor is coming from, she agreed with Cull. There was a lot of probing on the budget, even prior to the budget hearings.

“I don’t think any of us take these decisions lightly,” Havemann said.

Councilor Keith Lepsch added, “I believe our new county manager has represented the goals that we have told her were important to us, which is probably why we approved everything she suggested because it is really what we suggested…”

“This budget definitely reflects council’s goals and priorities,” Council Chair Denise Derkacs said.

Councilor Randall Ryti agreed.

“We actually plussed up,” he joked, referring to the budget option for funding regional development, which was increased from $250,000 to $1 million. “We didn’t just accept one of them, we added money to one of them.”

Councilor Melanee Hand said she was satisfied with County staff’s answers to her questions on regarding the budget.

“Thank you for all your hard work, all the departments, I believe that we don’t have frivolous requests, we have very justified requests…,” she said.

Earlier in the budget hearings, Los Alamos County Manager Anne Laurent summarized the FY 2025 budget, noting that the budget is shaped to council’s goals.
“Our focus in putting this together really was to look at what was necessary to implement council strategic goals and catch up on deferred maintenance,” she said.

As far as highlights for the FY 2025 budget, Laurent noted it includes a decrease of 12 FTEs in the fire department, an increase of four FTEs in the Department of Public Utilities, one FTE in emergency management in the police department, which would be partially funded by a grant, and one FTE for the aquatic center.

Overall, she said, the number in the budget looks smaller; expenditures in electric and gas commodities have gone down, for instance. However, expenses for all other operations have risen by $3.5 million. While it was reported during the budget hearings that the County’s finances are healthy, there is a looming issue. In the upcoming fiscal years, it is projected that the GRT paid by the laboratory will decrease due to its increase in pit production, which is tax exempt. County staff are proposing a quarter cent increment increase to its GRT, but council hasn’t approved the ordinance for this increase.

“It is important to highlight … we do still have a quarter cent increment in our plan for FY 2027 that (would) begin Jan. 1, 2026,” Laurent said. “That process, of an ordinance, of passing that, would have to start in January 2026 (and) our 10-year projections … do include that.”

Administrative Services Director Helen Perraglio touched on what it would look like without that quarter cent increment increase.

“If we don’t do the quarter cent, we begin to see an operating deficit in FY 26, we spend down half of our reserves in FY 27, with a $12.3 million deficit, and it requires a reduction in expenditures immediately of $12.5 million,” Perraglio said. “Some of those could be in the areas of transfers but then we would start to erode operations as well so operations or other cuts would have to be in the magnitude of $2.5 million. In order to maintain those target reserves for the 10-year long range financial plan we would have to continue to make about a $7.5 million cut each year thereafter. Those are large cuts; it takes away whatever we had left in the reserves … if we do not have the quarter cent GRT we will see that erode fairly quickly.”

The quarter cent GRT increment, if approved, would not prevent the County from having to go into its reserves. Perraglio explained that the County projects dipping into its reserves along with managing expenditures to maintain its target reserve balance of 20 percent over the 10-year long range financial projection. She said this is mainly because the County’s revenues are projected to be lower than its expenditures resulting in a few years of operating shortfalls that would be covered by reserves.

Council is expected to decide on the quarter cent GRT increment sometime in January 2026.