The City of Albuquerque received $150 million in federal aid this week, but the question still remains whether it can be used to keep the city operational.
During a press briefing on Monday, Albuquerque Mayor Tim Keller announced some good news— that the city received a support check from the U.S. Treasury Department. Keller later told NM Political Report the city is awaiting further guidance on whether the city can use that money to make up for lost tax revenue that is needed to pay city employees and avoid layoffs and furloughs. Much of the city’s operations are funded through gross receipts taxes, Keller said. But, with many of the city’s businesses shut down and consumers largely staying at home, the state is facing a revenue gap of about $70 million between this and next fiscal years, Keller said.
“The good news is the numbers line up almost exactly,” Keller said. “Tax revenue, we’re looking at being down $20 million this fiscal year and then $50 million the next fiscal year.”
Keller said the rest of the money would go to the daily costs of fighting the COVID-19 outbreak, with about $50 million left as a contingency reserve.
“As long as this doesn’t go past May, the $150 million should cover us just right and if it goes longer than May, we’re not going to have enough,” Keller said.
The money is part of the federal CARES Act, which was designed by Congress to distribute money to states and cities in need. But population qualifications for that money left out all New Mexico cities besides Albuquerque. The federal program limits funding to cities with populations larger than 500,000 people. At about 560,000 people in the city, Albuquerque narrowly made the cut, while populations in cities like Santa Fe, Farmington and Las Cruces are under 100,000 people.
Keller said he expects to hear from the Treasury Department within the next several weeks about whether the money can be used to supplement tax revenue and remains confident the city will get the greenlight.
But if the city does not get approval to make up for lost revenue, Keller said the money will go towards the daily operating costs for combating COVID-19.
“All that equipment that we’re using to deal with COVID, that’s all usually reimbursable,” Keller said. “We know that’s about $100,000 a day that we’re spending on COVID. But again, that’s nothing compared to the total cost of running the city per day.”