Two excellent posts on Joe Monahan's blog today, both address the City's falling revenue and home building bust. A good dose of reality! Full blog here.
Is Santa Fe Mayor David Coss falling behind the curve?
Gross receipts tax collections keep plunging, again coming in much lower than expected in April. That means the city budget just drafted is already outdated. You can't blame the mayor for keeping his fingers crossed and wishing for an economic rebound, but something more fundamental has happened and needs to be addressed. The epic boom in tourism in Santa Fe and America is over for now. The tax money generated by it in the 90's and early part of this decade is not going to be replicated anytime soon. Santa Fe city government appears to be in need of a restructuring so it can operate at permanently leaner levels. Either that or raise taxes.Coss is up for election next March and it seems he would rather cut in response to each monthly drop in tax collections. He wants to avoid layoffs at all costs. But Councilor Bushee and others seem more aware of (and less politically impacted) by the new paradigm. They are calling for deeper cuts to stabilize city government. Coss has a responsibility to keep the nation's oldest capital city humming along for the benefit of not only Santa Feans but the state and nation. Month to month budgeting is causing Santa Fe to really look like a "City Different," but not in a good way. Can't Coss and the Council have a "reality-based" budget meeting?
Unlike ABQ, Santa Fe did get carried away with the crazy housing speculation. As those bubble prices adjust (crash) construction jobs disappear. Add to the mix the lack of new state government jobs and you have a job market that is shrinking and a recession continuing. Occupancy for Santa Fe apartments is now just 83 percent. The median home price is now bouncing around the $350,000 level. That's down from the April 2005 all-time peak of $470,000, or a plunge of about 25 percent. The median has been as low as $308,000. Will we eventually break that level?The mantra that comes from the state spinners---"It's not as bad here as it is elsewhere"--is true for some parts of the state, but not for the storied city of Santa Fe and its budget-embattled leaders.