County hears FY26 budget overview as officials weigh GRT decline and bond-backed broadband plan

Los Alamos County officials opened multi-day hearings on the proposed fiscal year 2026 budget, reviewing year-end audited results, updated revenue projections and department-level spending requests before taking tentative votes on several departmental budgets.

County staff told the council the county ended FY2024 with a notably higher unassigned general-fund balance — roughly $60.4 million — driven by higher-than-projected GRT receipts and spending delays that produced one-time savings. That balance helped the county carry forward planned capital projects and absorb a projected decline in GRT this fiscal year.

The county manager’s overview and finance presentations framed the hearings. Staff said updated projections show an emerging decline phase for GRT: a projected drop of about $10 million from the county’s FY2025 adopted forecast and about $14 million from FY2024’s record audited GRT receipts. In the general fund the administration projects an operating shortfall of roughly $20.7 million for FY2025 (covered from reserves) and a projected shortfall of about $18.5 million for FY2026 under the proposed spending plan. Even after those draws, staff’s baseline model shows the county ending FY2026 with roughly $10.5 million above the county’s policy target for unassigned reserves, assuming the revenue and spending assumptions hold.

Because the GRT outlook tightened projections for later years, staff emphasized a multi-year view and presented scenarios that include a quarter-cent GRT increment (a 0.25 percentage-point increase) starting in FY2027 as a stabilizing option. The administration also proposed issuing $75 million in bonds — $35 million intended for community broadband and $40 million for other capital projects — and presented the estimated debt service impact. Staff said the debt service from the new bonds is estimated at roughly $5–5.5 million per year in the long run (with a higher $8–9 million annualized impact in the near term as older debt phases out), and noted the county’s strong reserves and upgraded bond rating provide capacity to pursue debt financing if the council chooses to do so.

Department presentations followed the overview. Highlights included: - Public Utilities reported a proposed department budget of about $107.3 million driven by purchased power costs, debt service for the White Rock wastewater plant, and capital projects. Staff said approved rate changes and proposed rate requests (examples given in the presentation: 6% water (already approved), 5.5% gas (already approved), proposed 7% wastewater and proposed 9% electric) would be reflected in utility revenue models. - Administrative Services and finance described work on the county’s ERP and disaster-recovery capabilities, cybersecurity and a multi-year replacement for the public-safety CAD/records system; IT capital requests were included in the CIP transfer. The CAD/records replacement and related public-safety software upgrades were identified as a multi-year, higher-cost CIP need. - Community Development summarized continued work on housing programs, a contract with a housing trust for down-payment/rehab assistance and increased contractual funding for a comprehensive master-plan update and building-code revision. - Community Services outlined parks, rec and social-services accomplishments and requested additional maintenance capacity (several budget options asked for recurring positions or program staff to maintain new athletic fields, golf-course assets, cemetery operations and expanded programming).

Votes at a glance (tentative motions recorded during the meeting): - Public Utilities — Tentative approval of the Public Utilities proposed budget in the amount of $107,289,835 (motion carried unanimously in roll call recorded as 7–0). Budget options 6 and 7 were included in the tentative approval. - County Council — Tentative approval of the County Council proposed budget in the amount of $445,212 (motion carried 6–1 on roll call). - County Attorney — Tentative approval of the County Attorney proposed budget in the amount of $1,500,630 (motion carried 6–1 on roll call). - County Manager’s Office — Tentative approval of the County Manager proposed budget in the amount of $25,393,200, including specified budget options (motion carried 6–1 on roll call). - Administrative Services (ASD) — Tentative approval of ASD’s proposed budget in the amount of $22,432,928 (motion carried unanimously, 7–0 on roll call). - Community Development — Tentative approval of the Community Development proposed budget in the amount of $17,971,077 (motion carried 6–1 on roll call). - Community Services — Tentative approval of the Community Services proposed budget in the amount of $33,154,153, including listed budget options (motion carried unanimously, 7–0 on roll call).

What the council asked and what comes next Council members pressed staff on the GRT projections and the sensitivity of the long-range model to different GRT scenarios. Councilors also asked for more detail on the proposed bond debt service profile and on the composition of the economic development/affordable-housing funds and how those funds would be used to support projects such as North Mesa infrastructure and the Ninth Street affordable-housing agreement noted in presentations.

Staff said the hearings will continue on subsequent nights with additional department presentations and a CIP review; staff also said any tentative changes adopted by the council during the hearings will be fed into the long-range financial plan so the council may see the multi-year impact before final motions. Staff emphasized that the quarter-cent GRT increment is an option in the multi-year scenarios; the administration said it will bring follow-up materials showing alternative scenarios (no increment, quarter-cent, larger increments) and the projected effects on reserves and debt capacity.

Community input and context Public comment during the hearing included one resident who urged stronger contract inspection practices by the Community Services Department and suggested Public Works inspect Community Services contracts that affect ground or buildings. The administration acknowledged the comment as part of the public-comment record and noted departments will continue to coordinate on contract oversight and project delivery.

Why it matters The FY2026 hearings set the county’s operating and capital priorities for the coming year and lock in recurring costs that shape the 10-year financial outlook. Staff presentations make clear the county has budget flexibility in the near term because of a larger-than-expected FY2024 fund balance; the council’s decisions about recurring spending, bond financing and whether to pursue a GRT increment will determine whether that flexibility is preserved over the next decade.

Next steps The council recessed the hearing series at the end of the night with tentative approvals recorded for the items above; the hearings will resume on the following scheduled meeting nights to finish remaining departmental presentations, review CIP details and consider final adoption motions once the council has had time to review any updated long-range projections.