Las Cruces finance director outlines options to close FY27 gap; council signals combined cuts
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Summary
Finance Director Leslie Doyle presented the proposed FY26–27 budget showing a personnel‑driven 7.9% increase in the general fund and a projected small ending balance; councilors discussed vacancy savings and operating cuts and expressed support for combining both approaches to reduce fund‑balance use ahead of the May 18 adoption.
Finance Director Leslie Doyle presented the City of Las Cruces’s proposed FY26–27 budget to the council and public on April 13, laying out revenue and expenditure forecasts, staffing and benefits assumptions, and several options to reduce reliance on fund balance.
Doyle said the proposed all‑funds FY27 budget is $598.1 million, with enterprise funds (primarily utilities) at roughly $199 million. The General Fund shows a $13.2 million (7.9%) increase driven entirely by personnel costs, including a budgeted 2% general wage increase and higher health‑insurance and PERA contributions. Doyle projected FY27 beginning revenue of about $185.4 million and expenditures of roughly $180.7 million, yielding a constrained ending balance after required reserves.
To reduce projected fund‑balance use (about $20 million if the budget is adopted unchanged), staff modeled three mitigation options: vacancy savings (approximately $7.8 million), operating cuts of about $8.0 million, or a combination of both. Doyle said using both approaches materially reduces fund‑balance utilization and improves the FY28 outlook if implemented.
Council discussion focused on balancing fiscal sustainability with service levels and workforce needs. Several councilors supported keeping the 2% wage increase while pursuing vacancy and targeted operating reductions; Councilor Harris emphasized long‑term sustainability rather than one‑off cuts. Councilors also asked for more detail on fleet electrification opportunities and the composition of transfers paid from the General Fund.
Public commenters urged different priorities. Lucas Hernan said cutting operations would harm Parks & Rec and other services and called attention to a $6.5 million liability line item; Juan Garcia urged revenue growth through business attraction; other commenters raised public‑safety and equity concerns.
Doyle said the council must adopt the budget by May 18 and asked for direction on which mitigation approaches to pursue. A number of councilors signaled support for the combined vacancy‑and‑operating‑cuts approach (the staff “option 4”) as a working direction to refine before adoption; staff will return with detailed implementation adjustments in follow‑up sessions and the formal budget ordinance.
