BY FREDERICK MATTHEW FREYER
Founder of TechShare LLC
Los Alamos

Los Alamos County is preparing to raise our Gross Receipts Tax from 7.062% to 7.6875% starting in July 2026. The County Council calls this “slightly more than half a percent”—about 60 cents per $100 —and says it’s necessary to prevent budget deficits of $16–$20 million by 2027. They say the increase is “nominal,” that it keeps our rate competitive with other Northern New Mexico counties, and that it’s the responsible move to maintain public services. But the truth is more complicated, and residents deserve the full story.

The shortfall the County is trying to fix wasn’t caused by wasteful spending or underfunding. It started when Los Alamos National Laboratory began using the state’s manufacturing exemption, which allows “manufacturers” to deduct certain receipts from taxation. LANL argued that parts of its plutonium pit production and component fabrication count as “manufacturing” under the law—and by the letter of the law, they’re right. When that exemption took effect, the County instantly lost millions in Gross Receipts Tax revenue. LANL’s budget stayed intact, the State didn’t lose much, but our local government took the hit.

Faced with that loss, the County had choices. It could have gone to the Legislature and lobbied for clarification that the exemption wasn’t meant for a federal lab. It could have worked with LANL to create a voluntary impact contribution—helping to fund the housing, roads, and emergency services that the Lab’s 10,000 daily commuters depend on. It could have begun tightening spending or slowly adjusting rates years ago when the exemption first appeared on the horizon. Instead, it’s taking the low-risk route: raising the GRT on everyone else.

That decision is being framed as “leadership,” but it’s really the opposite. Gross Receipts Tax isn’t charged on profit—it’s charged on every dollar that moves through a business. When that rate goes up, small businesses, contractors, and service providers pay more on their gross income whether or not they make a dime of profit. Those costs trickle down into higher prices for everything from coffee to car repairs, and they compound through every link in the local economy.

The County insists this increase is minor because our overall rate will still be lower than Santa Fe, Española, or Taos. But those comparisons miss the point. Los Alamos is unique: our economy revolves around one large institution, which just reduced its contribution to the local tax base. Instead of challenging that, the County is asking the rest of us to fill the gap.

Leadership isn’t about doing what’s easiest on paper; it’s about doing what’s right for the people you serve. Los Alamos deserves officials who will stand up to the state and the Lab when local residents and businesses are paying the price for their decisions. We deserve a County that fights for its people, not one that quietly shifts the burden onto them and calls it responsibility.