Finding $15 million

"This is my first full budget cycle, and I'm not sure that this one is what I would consider normal."

Las Cruces City Finance Director Lesley Doyle paused for a moment before adding the part that drew laughter around the room.

"At least I hope it is not, because I'm not sure that I can handle another year like this."

Everyone seated around the table understood exactly what she meant. For months, Doyle, City Manager Ikani Taumoepeau, Capital Improvement Program Manager Cynthia Alamillo and dozens of department leaders had been wrestling with a problem that many families know all too well.

The city wasn't running out of money. Revenue was still growing. The problem was that costs were growing faster.

Health insurance costs continued to climb. Retirement obligations increased. Personnel expenses consumed an ever-larger share of the city's general fund.

Like households staring at grocery receipts, utility bills and insurance premiums that seem to rise faster than paychecks, city leaders found themselves confronting a reality that could no longer be ignored.

"Revenue is growing," Doyle said. "It is not growing fast enough to keep up."

Personnel costs now account for roughly 70 to 75 percent of the city's general fund budget, leaving only a relatively small portion available for the operations, maintenance and services residents see every day.

Somewhere between those rising costs and a determination not to spend down the city's reserves, city leaders were asked to answer a difficult question:

Where do you find $15 million?

The answer would shape Las Cruces' fiscal year 2027 budget and force city leaders to rethink not only what they spend, but how they operate.

The budget ultimately adopted by the city council totals approximately $586.3 million, down from roughly $612 million the previous year. Yet the challenge facing city leaders was never simply reducing the size of the budget. Much of the city's spending is tied to dedicated funding sources, utilities, grants and capital projects. The more difficult task was finding reductions within the portions of the budget that pay for the day-to-day services residents depend on while preserving the city's long-term financial stability.

"We typically start meeting with departments in the fall and getting an understanding of what their needs are," Doyle said.

The process begins months before a budget ever reaches the council. Departments submit requests. Revenue is monitored throughout the year. Finance staff compare spending patterns, evaluate needs and attempt to forecast where the city is headed. This year, however, the normal process quickly became something else.

Certain spending categories received extra scrutiny. Travel. Temporary services. Operational expenses. Department leaders were asked to take a closer look at spending that might have been routine in previous years.

Then came the moment that changed the conversation.

After reviewing several scenarios presented by staff, the city council directed the administration to identify approximately $15 million in reductions. The broad target was set. Now the city had to figure out how to get there.

"Once we got the direction from them, we went back to the departments and worked with them to figure out how to figure out $15 million," Doyle said.

What followed wasn't a search for one dramatic cut. It was a search for dozens of smaller decisions.

Vacant positions were examined. Travel budgets were reviewed. Operational spending was reconsidered. Department directors were asked to evaluate services, staffing and priorities.

Most importantly, they were asked to answer a question that became central to the entire process: If cuts were necessary, where could they be made with the least impact on the people who live in Las Cruces?

"We did want to mitigate the effect on the community as best we could," Doyle said. "That was definitely the conversation as we moved forward with this process."

That philosophy would guide nearly every decision that followed. For Taumoepeau, the objective was straightforward.

"Our goal is that the average resident doesn't feel it," he said. "They don't notice it. It isn't apparent, the reduction in level of service."

That doesn't mean there are no consequences. The city left dozens of vacant positions unfilled. Maintenance schedules may be stretched. Some tasks may take longer to complete than they once did.

"We're not going to empty the trash cans as frequently as we used to," Taumoepeau said. "We're not going to patch holes as frequently as we used to."

Even those examples, however, reflect the broader strategy. The city did not lay off employees. Instead, leaders chose to absorb reductions largely through vacancies, restructuring and efficiency measures.

"If this is the new norm, then that's what we're sharing with our staff," Taumoepeau said. "Let's do our best to get comfortable with this. And if we need to restructure departments with the current staff that we have, what do we need to do to restructure that?"

Technology has become part of that conversation.

The city has formed committees to examine efficiency, organizational structure and opportunities to use technology to accomplish work differently. The goal is not simply to survive one difficult budget year but to create a model that can be sustained going forward.

For Mandy Leatherwood, the city's communications director, the process ultimately became an exercise in prioritization.

"When we had more resources, we could do things that weren't our core services," she said. "Now we're just having to prioritize what those core services are for the community."

One of the clearest examples of that philosophy can be found at Thomas Branigan Memorial Library. As city departments worked through the budget process, library administrators evaluated how they could continue serving the community with fewer resources. The result was a decision to eliminate Sunday hours beginning July 1.

That could have been the end of the story. Instead, it became an example of how adaptation sometimes extends beyond city hall.

After learning of the changes, the board of Friends of Thomas Branigan Memorial Library voted to provide funding to cover security costs that would allow the library to maintain additional weekday hours. The organization also agreed to help cover food and beverage costs for public programs aimed at youth and families.

Under the new schedule, the library will be open from 9 a.m. to 8 p.m. Monday through Thursday and from 9 a.m. to 6 p.m. Friday and Saturday, while Sunday hours will be discontinued.

The library will operate differently than before, but community support helped soften the impact. It is precisely the type of solution city leaders hoped to find throughout the budget process: not eliminating services whenever possible, but finding ways to preserve them.

The city's capital improvement program tells a different story altogether. While operating budgets tightened, major infrastructure projects continue to move forward.

Alamillo oversees a capital improvement program that includes hundreds of projects involving roads, utilities, parks, buildings, airport facilities and other public assets. Unlike the general fund, much of that work relies on grants, bonds, capital outlay appropriations and other dedicated funding sources.

"We have about 300 projects," Alamillo said. Some projects are phased over multiple years. Others continue as funding becomes available. While inflation and construction costs create challenges, the city's long-term infrastructure plans remain largely intact.

Taumoepeau noted that recently approved gross receipts tax bond funding has provided approximately $28 million in additional resources for capital projects.

Those funds were intentionally protected from being used to solve operating budget challenges.

"If the taxpayers are paying for it, let's make sure that they see it in tangible assets," he said.

That distinction became important throughout the budget process. Roads, facilities and infrastructure projects remain visible reminders of public investment even as city leaders work to manage growing operational costs.

Perhaps the most significant decision, however, involved money that was never spent.

Throughout the process, city leaders repeatedly emphasized their commitment to preserving reserves. Like many New Mexico municipalities, Las Cruces maintains reserve funds intended to provide stability during emergencies and economic downturns. The city could have used those reserves to reduce the need for cuts. It chose not to.

"We refuse to touch that during these budget cuts," Taumoepeau said.

The city maintains approximately $30 million in reserves, about double the state-required one-twelfth reserve fund. Despite the pressure to close budget gaps, officials made a conscious decision not to use those savings to balance the budget.

Doyle agreed. The entire exercise, she said, was built around the idea that the city needed to solve the problem without relying on savings to do it.

The easier path would have been to postpone difficult decisions. Instead, city leaders chose to make them now.

For Doyle, the process required difficult conversations and countless hours of analysis. For department leaders, it meant reexamining assumptions that may have gone unquestioned for years. For employees, it often meant finding ways to do more with fewer resources.

"I do think that there was some really good work done by the departments to look at how we could be better," Doyle said.

In the end, the story of the budget is not really a story about a number. It is a story about a city trying to adjust to changing circumstances before those circumstances force more painful choices.

The questions raised during the process remain.

How should departments be organized? Where can technology create efficiencies? Which services are essential? What can be done differently?

Some of those answers are still being discovered. Others will emerge over the coming year as employees adapt, projects continue and residents go about their daily lives. Whether the average resident notices may ultimately determine whether the effort succeeded.

But for the people who spent months searching for $15 million, the budget was never simply about balancing a ledger. It was about figuring out how to adapt to the economic circumstances on the ground.