Potential GRT increase to be determined by voters

Las Cruces Mayor Eric Enriquez asked residents to trust city leaders as City Council approved a ballot question at its July 15, 2025 meeting, that if passed by voters in November, would raise municipal gross receipt tax rates to generate $11 million of revenue per year.

According to deputy economic development director Chris Faivre, a total increase of 0.5625% to the city's Gross Receipt Tax would generate $20 million in new revenue per year in order to fund public safety, street improvement, park improvement and public facility projects.

But city staff proposed a two-part process - the first of which will be determined by voters, who will be asked in November to raise the GRT by 0.325%. If approved by voters, City Council could then pass an ordinance following the election that would add about $9 million per year by raising the tax by 0.2375%.

"Nobody is coming to save Las Cruces except for us," Enriquez said following a public comment period where residents who spoke against the tax hike cited questions regarding transparency. "That is why we are bringing it to voters so that they can decide. To make Las Cruces better, safer. And just to trust us."

If the council adopts both recommendations, it would equate to an increase of about 56 cents per $100 spent on goods and services. If approved by voters, the tax increase would take effect on July 1, 2025.

On Monday, Faivre highlighted projects such as a joint police and fire training facility, a modern downtown police station and a west side recreation center that would utilize the revenue generated through the tax increase. Additional projects could also address badly needed road and park repairs throughout the city as municipalities and residents alike continue to struggle with increased costs as a result of the pandemic.

“I get the feeling that it feels fast or rushed, but it’s because there is a deadline that we have to meet,” Bencomo said. “Things got expensive for all of us, including the City of Las Cruces, as well.”

Enriquez and Bencomo said the city has proven through recent GO Bond projects to be responsible stewards of the public’s money. Most of the projects voters approved in 2022 through $23 million in GO Bonds have either been completed or are nearly completed.

Faivre said if voter approved, City Council could pass a future resolution listing priority projects with regular updates similar to how staff has updated council and the public throughout the course of projects that were funded with GO Bonds.

Enriquez pointed out that certain fire stations in the city were built in the 1960s, the Public Library is due for upgrades and Meerscheidt Recreation Center remains the lone multiple use recreation center in Las Cruces after it opened 50 years ago.

"There has never been a plan to replace those,” Enriquez said. “This gives us the opportunity to use the funds for public safety and it all comes down to trust, safety and better.

"These things continually come up. ... We know the library. Just to upgrade what we have is $45 million. It's not going to happen. It's not going to happen through the state, it's not going to happen through grants. It's not going to happen any other way."

The office of City Manager Ikani Taumoepeau is suggesting both proposals, but council directed city staff to make it clear through voter education materials in the coming months that the tax increase is a two-part process.

Ballot question will be submitted to county clerk

Councilor Bill Mattiase was in favor of tax revenue used for public safety projects, but he suggested a "sunset" date be added to the ballot question, which would return the GRT rate to the current level after a period of time.

But the resolution passed with the following language that will be submitted to the Doña Ana County Clerk's office before the August 27 deadline to appear on the ballot.

"Shall the City of Las Cruces impose a municipal gross receipts tax in the amount of three hundred twenty-five thousands of one percent (0.3250%) the revenues of which shall be used for funding capital improvements and maintenance for public safety, streets, parks, and other public facilities and critical infrastructure?"

The city's current GRT rate is 8.0625%. It sits behind municipalities such as Taos (9%), Santa Fe, Ruidoso and Farmington (8.1875%), Sunland Park (8.175%) and Anthony (8.1250%). Albuquerque's rate is lower - 7.6215%.

The last time the city raised its GRT rate was in 2015 when it increased from 7.9375% to 8.3125%, although it has since been lowered to the current rate.

"The confusion of this proposal just takes me by surprise," Mattiase said. "I just wish it was more simply done and probably easier for the voter to understand. At the same time, I really want to support our police chief, our fire department and our public safety departments."

GRT is the city's largest revenue source and lands in the general fund. GRT is not collected on groceries or medicine. The City's general fund, which is used to fund departments such as police, fire, public works, economic development and libraries, increased 8.8% from $151.8 million in FY24 to $165.1 million in FY25 according to the budget the city approved in May. The City projects $146 million in revenues in FY25, most of which (76%) is produced by gross receipt taxes. The City collected $108.5 million in FY24 from gross receipt taxes and projects $110.7 million in FY25.

"I just want to acknowledge that this is a heavy discussion, and I also hope that voters consider it with equal consideration," Councilor Becky Corran said.

Jason Groves can be reached at 575-541-5459 or jgroves@lcsun-news.com. Follow him on X @jpgroves.