����������ϼ�

Albuquerque Mayor Tim Keller is tightening the city budget for the next fiscal year ahead of an expected economic downturn.

But even with $35 million in cuts, the city is projected to spend more from its largest account than is being replenished by revenue by 2030, according to data from the proposed city budget.

“A budget can be balanced on paper, right?” said City Councilor Stephanie Telles. “It can be technically balanced and still structurally unsound, and I think that's what we're seeing here.”

If cuts were not made, the city would have overspent its general fund by $57.4 million next fiscal year — a gap that is projected to grow to $114 million by 2030.

In 2027, the city will withdraw approximately $817.4 million from the general fund, the largest chunk in its $1.47 billion budget.

While the general fund is not the city’s only funding source, it is its largest. The fund is fed by a myriad of taxes, primarily the gross receipts tax, though other income includes service charges, fines, permitting fees and investment earnings.

Though the city cut $35 million, there is still a $652 million gap that supplemental funds must fill, hinting at a growing reliance on other revenue sources.

That reliance appears to have begun during the COVID-19 pandemic when an influx of relief money was sent to the city by both the state and federal governments. Analysts state in the budget that cuts were necessary, in part, to begin weaning the budgets from those supplements that have become less reliable under President Donald Trump.

Other earnings outside the general fund include capital outlay money from the Legislature, federal grants, city enterprise and other revenue streams.

However, it’s unclear if these cuts will be enough in the long run, Telles said.

“Reductions may not be real enough to buy time or deep enough or structural enough to maintain that long-term trajectory,” Telles said. “So restructuring isn't necessarily always the same as a sustainable path.”

A gloomy forecast for the general fund and city earnings in general is based on both global ripple effects and local stagnation, according to an analysis in the budget.

While the city’s annual revenue is growing by a few percentage points per year as normal, war in the Middle East and domestic distress over rising costs are introducing new uncertainties to the budgeting process.

“Albuquerque is not immune to those national trends,” said Chief Financial Officer Carla Martinez in a statement Friday.

Budget analysts expressed concerns over both international conflict and domestic turmoil, while Keller wrote in his letter to the City Council that the administration is working with a “heavily constrained fiscal environment.”

Keller pointed to local struggles, including Albuquerque’s “relatively flat population growth," which has prevented the city’s tax revenues from keeping pace with inflation.

Keller was not made available for an interview on the budget for fiscal year 2027, which begins July 1.

“The global instability can affect what the city pays for when it comes to goods and services,” Telles said. “With inflation and the tariffs and of course, these wars that are just causing prices to skyrocket. But it's not just an outside problem.”

Despite challenges, Telles said that it is the council and mayor’s responsibility to adapt and keep the deficit from growing. 

With the budget tight, city workers will feel the impact the most. The reduced budget eliminates 247 positions, with the hardest-hit sectors being the Transit, Municipal Development and Youth and Family departments. The budget does not disclose how many of those 247 positions are currently filled, making it unclear how many city workers might be laid off.

However, the budget added back funding for 67 new positions, many of which are in General Services, Albuquerque Community Safety and Keller’s chief administrative offices. The budget also includes $16.4 million in pay increases for rank-and-file city employees across departments.

While Keller has submitted his wishes for the upcoming budget, the City Council ultimately holds the purse strings.

The council's Committee of the Whole will consider the budget in a series of May meetings and must come to a final decision by May 18.

Gillian Barkhurst is the local government reporter for the Journal. She can be reached at gbarkhurst@abqjournal.com.