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Lovington staff proposes balanced FY27 budget after $2 million in cuts; commission agrees to submit interim plan
Summary
Staff presented a FY27 interim budget that reduces a $2 million shortfall through cuts to raises, new positions and department requests; the commission indicated consensus to submit a balanced interim budget with no across-the-board raises and to revisit staffing and raises later in the summer.
Miranda, a city staff member, presented a proposed fiscal year 2027 budget that the city described as balanced after staff cuts of about $2,000,000 from an initial unfiltered request.
"I promised the commission a balanced budget, and we have cut $2,000,000 from this initial budget," Miranda said, providing the staff's numbers: a $14,101,291 general fund, a $14,106,369 enterprise fund and $6,700,568 for capital projects. Miranda said the budget assumes a conservative monthly gross receipts tax (GRT) of $956,000 despite recent monthly averages above $1.1 million.
To reach balance, Miranda said staff eliminated all requested salary increases, cut all new position requests (with one exception to leave open an HR generalist), canceled a $72,000 zoning-code rewrite, reduced police overtime by $100,000 and deferred two certified officer positions (about $190,000). Animal control, parks and senior center line items were also trimmed; the city retained funding for a street sweeper and three public works vehicles.
Finance staff explained revenue assumptions and reserves, saying the state expects roughly one month of operating expenses in reserve and that some capital-projects funding is already grant-secured. The finance staff reported about $1,000,000 in available capital-project cash and identified roughly $5.27 million in grant awards tied to specific projects.
Commissioners pressed staff on health insurance and retirement costs. Miranda said medical insurance costs are budgeted to rise about 13% in the coming year and that prescription costs are a major driver. Commissioners discussed options including joining state insurance pools and exploring retirement-plan changes for new hires (PERA alternatives to a 401(k) were discussed as a prospective-only change). The commission also debated a proposed street sweeper purchase and whether to repair existing equipment instead of buying new.
By the end of the session commissioners signaled they would likely approve the interim budget submission with no raises and asked staff to enter the interim budget into the state system; final adoption remains scheduled for September when actual cash balances will be clearer. No formal final adoption vote took place at the special session.
Miranda and finance staff will make the interim submittal as directed and bring back any adjustments or additional workshops if revenue or cash balances warrant further action.
