The county will now draft a title and summary for separate ordinances that would impose a GRT increase of 1/8 of one percent and another for a 1/16 increase — for a total of 3/16 of one percent, the equivalent of 19 cents on every $100 spent at the cash register on most goods or services, but not food or medicine.
Both ordinances can be enacted at the same time, county spokeswoman Tessa Jo Mascareñas said, and commissioners can approve the GRT increases without putting them before county voters in an election.
A public meeting on the proposed tax ordinances will be held May 30. If approved, any increase would take effect Jan. 1, 2018.
If both increases are approved, the county can make 13 hires — mostly in the sheriff’s office, the fire department and the jail — when the new fiscal year begins July 1 and make another 38 hires Nov. 1, according to a presentation County Manager Katherine Miller made Tuesday. The two increases together are expected to generate $6.9 million in extra revenue, Miller’s presentation showed.
The current GRT in the Santa Fe city limits is 8.3125 percent, including rates imposed by the city, county and state. Most of the rest of Santa Fe County pays 7 percent in GRT, but consumers in the portion of Española that crosses into northern Santa Fe County already pay a GRT of 8.9375, totaling levies from various jurisdictions.
District 1 Commissioner Henry Roybal asked Miller if his constituents living in that area could be exempt from a tax increase, but Miller said she couldn’t exclude anyone in the county unless a state statute allowed her to.
The tax increase is meant to address staffing shortages, especially the fire department, which needs additional firefighters and paramedics. Commissioners also want to use the funds to create more behavioral health services in the county.
“The public safety arena is something that is always a 24-hour business,” county Public Safety Department Director Pablo Sedillo said at Tuesday’s session. “I absolutely support this.”
Commissioners said they believe more money is desperately needed now.
“I’ve told my constituents that I wouldn’t vote to impose a tax just because we can,” District 5 Commissioner Ed Moreno said. “I think we’re at that point where we don’t have any other options. The executive branch has failed the citizens of New Mexico. We’re at a time where we need urgent action.”
The county is authorized to raise GRT under a tax deal the Legislature and Gov. Susana Martinez reached in 2013. The resulting legislation phases out over 15 years so-called “hold harmless” payments from the state to city and counties intended to make up for revenue lost to local governments when the Legislature removed GRT from food and medicine. In return, cities and counties were granted authority to raise GRT by up to 3/8 of one percent. Santa Fe County implemented a 1/8 of one percent increase in 2015, so it still has authorization to raise the tax another 2/8 of a percent.
In practice, local governments for now have been able to take in extra government under this arrangement, as they continue to get “hold harmless” payments, albeit at lower amounts and can more than offset their losses with higher GRT rates.