Loss of Services, Wage Cuts and Hiring Freezes: Coming to a City Near You

The individual is going to be faced with tough challenges and the fragile national economy is underscoring those problems. There is no simple solution except to be prepared for the worst and hope for the best.

Property taxes provide county governments with large portion of their revenues. It is from this money that capital expenditures and public services are derived from. In New Mexico, many counties are the home to federal lands. This includes National Parks, US Fish and Wildlife Lands, Bureau of Land Management Lands, and US Forest Service areas. These public federal lands are not taxable under the law.

To help off-set the losses local governments face from having nontaxable Federal lands within their boundaries, the Federal government issues Payments in Lieu of Taxes (PILT). The payments are based on a complicated series of facts. In fact, the formula is so complicated; counties have no way of knowing exactly how much money they will receive for PILT each year. This has led to budget short-falls across the state of New Mexico this year.

Overall, the state received $32,205,935 for 2010. This is a down $4,807,399 from 2009. The state of New Mexico actually saw an increase in Federal property for 2010 by 8,105 acres bringing the total Federal public land to a total of 22,510,697 acres in New Mexico.

The complicated formula for individual counties takes into account the number of Federal acres within the county, the population, and different types of payments that can be calculated. One calculation is based upon the current market value of the property on the open market.

Counties have seen anticipated revenues from the PILT program drop as much as 63% and are now scrambling to re-budget for the loss of revenue. One of the first items to go is any capital outlay projects which include road and county service improvements. Many counties are also facing hiring and wage freezes for their employees.

We have seen what an unstable economy does to a country. Greece has had multiple riots and things may yet explode in this country as well as the economy worsens. The local economies will be dealing with the national and world economies in ways we have not seen yet. The City of Albuquerque has proposed to cut all police and fire department wages. Everyone in those vital positions will be making minimum wage. Minimum wage is better than running out of unemployment as extensions expire. Rural communities and counties may have to do the same or possibly eliminate those, and other departments, altogether.

This means is that the individual citizen will need to become more self-reliant and self-sufficient for fire and home protection. As the government is the main employer for all areas, this could have a direct effect on individual taxpayers and families. With wages shrinking, jobs disappearing, and government services vanishing, individuals will face tough decisions on how to feed and shelter their families. Need may soon outweigh common sense.

A crisis is coming to your neighborhood and there may be no way to stop it. Be prepared at the family level and remember, it could always get worse.

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