City holds second town hall on gross receipts tax

CNJ staff photo: Kevin Wilson The City of Clovis held a town hall meeting Wednesday regarding a special election for a .25 percent gross receipts tax increase. About 20 residents attended. The special election is May 3.

Kevin Wilson

Clovis Mayor Gayla Brumfield said the first time the city held a town hall meeting on a proposed gross receipts tax increase Jan. 31, the meeting went past 9 p.m., and joked they should be out of the second meeting around 10 p.m.

With lower turnout and fewer questions, the town hall meeting finished closer to the hour prediction that Brumfield seriously made.

At issue is a proposed .25 percent gross receipts tax increase, which would pay for part of Clovis’ share of the Ute Water Project. The $500 million project would pump water from the Ute Reservoir in Quay County to communities in Curry and Roosevelt counties.

Information given at the town hall was very similar to that given at the Jan. 31 town hall, held before the city commission took a vote on an ordinance to raise the gross receipt tax rate from 7.5625 to 7.8125 percent, with a sunset date in 10 years. The money would pay $13 million of the city’s $36 million share for the project, with water sales covering remaining costs.

The ordinance passed 7-1, but it was forced into a special election after the High Plains Patriots citizens group mounted a petition drive. The special election is scheduled for May 3, with absentee voting available now and early voting starting Wednesday and ending April 29.

Officials for the project estimated it would be completed by 2018, with water flowing in 2019 for approximately $2.80 per 1,000 gallons.

“It’s an enclosed system that will pay current expenses as well as long-term expenses,” said Kevin Powers of RBC Capital.

The High Plains Aquifer is depleting, Brumfield said, and Daniel Bailet of New Mexico American Water Company said it’s diminishing returns to be Clovis’ water supplier with just the aquifer as a source.

“We’ve more than doubled the wells (from 28 to 64 over 10 years), and we’re getting less than 75 percent of the water we got before,” said Bailey, the company’s vice president and general manager.

City Manager Joe Thomas also went through city taxes, and what each increment has paid for since a .25 percent increase was approved by voters in 2004 to fund water projects, police and fire, drainage and street repairs.

Brumfield said people have called that tax a “bait and switch” because then-Mayor David Lansford said half of the tax could be spent on the project. She said the official minutes of the meeting reflect that his suggestion did not become official policy.

“That was never voted on,” Brumfield said. “That was just a conversation.”

Curtis Anthony of Clovis asked two of the three citizen questions — what NMAW’s role would be in the project, and whether an alternate plan from Commissioner Randy Crowder was considered.

Crowder, who voted against the ordinance, has contended the financial obligations can be met by eliminating various taxes, including those dedicated to landfill and parks, when various bonds are paid off.

Commissioner Fred Van Soelen said he looked at the plan, and determined it could be done, but would leave no money for infrastructure.

Bailet said NMAW would likely change the focus from water acquisition to water transmission.

Anthony’s son, Curtis W. Anthony asked the other question, about how he could get information the city used during the presentation. Brumfield said if he couldn’t get copies from commissioners, he or anybody could get them from City Hall.

About 20 residents attended the meeting, compared to 35 from the Jan. 31 meeting.