MAYOR vs. MAYOR
Mendoza lays blame on Rosebrough for fiscal woes

By Zsombor Peter
Staff Writer

GALLUP — Blaming the last administration for the way it spent the city’s money is one thing. Blaming it for how much it spent — or how much debt it left behind — is quite another. The former is a matter of opinion. The latter is a matter of fact. And according to the numbers the last administration provided, the new administration has its facts wrong.

City Manager Gerald Herrera is no fan of the press. Since taking office July 16, he’s turned down all requests for comment or interviews from the media. He even refused to speak with The Independent the first time Mayor Harry Mendoza floated Herrera’s name as his personal pick for the position — before he even applied for the job. But soon after securing the job from the City Council July 13, he did spare a few minutes for another local newspaper.

In the article that followed, he’s quoted saying that he just inherited an $84 million city debt.

“The city is going to be strapped for the next 15 years,” he said. “I want to get the city back on its feet.”

Mayor Harry Mendoza has also lamented the city’s financial condition at the expense of the last administration.

The last administration, however, tells a very different story.

“The city is in real sound financial condition,” said Larry Binkley, who stepped down as Gallup’s administrative services director — and its top financial guru — in mid-May.

According to Binkley, when the last administration left office in March, the city was well on its way to ending the fiscal year with a cash balance above what’s required by city ordinance, which itself is above what the state requires.

“And lodgers tax (revenue) is probably in the best fiscal condition it has ever been,” he said.

But what bothers former Mayor Bob Rosebrough most is the new administration’s claim about the public debt it’s “strapped” with. Both he and Binkley said they could not figure out how Herrera came up with $84 million.

According to Rosebrough, the city took on only $42.7 million in debt during his four-year tenure in the mayor’s seat. Taking into consideration the outstanding debt his administration inherited, Binkley said, still brings the total in under $50 million. Even the interest, he added, should not bring the figure anywhere near $84 million.

For every debt it took on, Rosebrough said, his administration made all the necessary arrangement to pay it off. The council raised utility rates to pay for $22 million worth of utility bonds. Voters twice approved property tax increases so that the city could take on $6.7 million in general obligation bonds. And as for the $14 million in revenue bonds, the city cut operating expenses that — if maintained — would more than pay them off.

Binkley said the last administration even left its successors with enough financial wiggle room to take on a modest amount of new debt, without raising utility rates or taxes. Exactly how much, he said, was a question for Paul Cassidy of RBF Financial Markets, the city’s independent advisor on bond matters.

Cassidy was willing to speak with The Independent but wanted City Hall’s permission first. He didn’t get it. Cassidy said he was told that all questions would have to go through Herrera. The city manager, however, chose not to return The Independent’s messages. Administrative Services Director Judi Starkovich, Binkley’s successor, did not return the paper’s messages either.

Before the Rosebrough administration took office in 2003, Binkley said, the city hadn’t taken on any general obligation bonds for more than 10 years. If that council had chosen not to take on the $6.7 million debt, it would simply have passed the opportunity on to the next. Besides, the last council didn’t decide to sell the bonds on its own. It did so with the blessing of more than 60 percent of the voters.

“I’m real proud of the projects we were able to accomplish in Gallup over the four years, and by necessity those projects did involve incurring debt. That’s simply unavoidable,” Rosebrough said.

Rather than blame their predecessors, he added, “it’s time now for the new mayor and his administration to be judged on their actions and results.”