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Pongratz: A Bit Of Nit Picking

on December 21, 2017 - 1:54pm
Former Los Alamos County Councilor
I think that the term “windfall” is not appropriate to describe the gross receipts taxes paid by LANL contractors. Merriam-Webster defines “windfall” as:
1: something (such as a tree or fruit) blown down by the wind;
2: an unexpected, unearned, or sudden gain or advantage.
The term is not correct for two reasons: first, the term refers to a “one-time” event. Once all the apples are off the tree you can expect no more apples to fall. The citizens of Los Alamos should expect that LANL contractors will continue paying gross receipts taxes.
Second, the term “unearned” does not apply to the taxes paid by LANL contractors. In the 70’s, the legislature “reformed” the tax structure in New Mexico. In general, funding for basic governmental services (roads, police, fire, recreation, etc.) went from property taxes to gross receipts taxes (mostly from retail sales). In general, property taxes were to fund capital improvements.
The high percentage of Los Alamos residents working for LANL, and not involved in retail, skewed the funding base for Los Alamos. Fortunately, in those days, the DOE compensated via the “Assistance Payments” to the county. Those “Assistance Payments” are now a thing of the past and it is altogether fitting and just that LANL contractors compensate the county for the impact their workers have on the provision of governmental services.
In fact, there was a ”windfall” to the county in the 80’s when we received about $5 million in back gross receipts taxes owed by the former Zia Company. My fellow councilor, Sid Singer, deserves credit for pursing those monies. We were able to build the swimming pool without having to increase property taxes.
My hat goes off the County Manager, Harry Burgess, and his team for the prudent use of the $25 million annual increase in county revenues once LANS came into being. Despite the doubling of county revenues there was no dramatic increase in personnel costs. The “new” money went into new buildings, road improvements and infrastructure upgrades. Now, having completed those capital projects, one might hope that the gross receipts tax rate might be lowered when the new contract takes effect.
A final note, dire circumstances were predicted come “taxing the lab”. The lab’s major challenge was not paying the justified taxes, but not understanding the distinction between the terms “inorganic” and “an organic”.