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Council rejects proposed half‑penny grocery tax after marathon debate and multiple amendments
Summary
After more than five hours of debate and several floor amendments, the Albuquerque City Council voted 1–8 to defeat O‑26‑16, a proposed 0.4875% municipal gross receipts tax intended to fund capital projects and boost city employee pay. Supporters said it would stabilize pay and operations; opponents called it regressive and rushed.
Councilors debated a proposed municipal gross receipts tax for most of the evening before ultimately rejecting the measure.
Councilor Kelsey Bassan introduced O‑26‑16 as a one‑time opportunity to raise revenue immediately under a recent state filing deadline, proposing a 0.4875% increase in the city’s local gross receipts tax. Bassan said the package was intended to fund long‑deferred capital projects and to reserve ongoing funds for municipal operations, including worker pay: “This equates to one half penny, less than one half penny for every dollar spent in Albuquerque,” she told colleagues, and argued the change would let the city invest in roads, facilities and wages without relying solely on volatile state funding.
The ordinance quickly attracted a stream of amendments. Councilor Piedelkorn pressed to guarantee that operational dollars go exclusively to employee compensation; that amendment passed, restricting any operational share to staff pay. Piedelkorn later proposed— and the council adopted on a 6–3 vote— a 70/30 split of projected revenues (70% operations, 30% capital) to prioritize ongoing personnel costs amid uncertainty about state and federal funding. Other floor amendments reduced the tax’s size; Councilor Piedelkorn successfully moved to cut the proposed rate to 0.1275% in a later amendment, a change supporters said would reduce impacts on low‑income households.
Council debate tracked those tensions. Supporters and labor representatives argued the city cannot recruit and retain staff at current pay scales: “We’ve got employees leaving by droves,” said a union speaker during public comment. Councilor Piedelkorn said a stable revenue source would let the city pay the class‑and‑comp increases already recommended in a city salary study. Opponents, including Councilor Lewis and several other councilors, warned the proposal placed a regressive tax on low‑income residents and small businesses, and said the council and administration had not completed usual budget‑cycle review. "A new tax should not be considered before we complete a FY27 budget process," Councilor Tayas said during debate.
After hours of amendments and multiple roll calls, the ordinance failed on a 1–8 vote. Because the council considered several companion resolutions and later narrowed or deferred parts of the package, proponents said they plan to return with revised proposals and to continue negotiations with the administration and unions. Opponents said the vote affirmed concerns about process, fiscal discipline and the difficulty of asking low‑income residents to shoulder recurring costs without clearer alternatives.
What happens next: Supporters indicated they intend to continue the conversation through the budget process and to seek other funding avenues; several amendments and companion measures were left on the table or deferred for later committee consideration. The council’s vote preserves the status quo pending further budget deliberations and any new proposals.
