I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
While environmental activists played their part yesterday during demonstrations at the capitol building, going so far as to dress up as solar panels and to sing the tune of “You Are My Sunshine,” their counterparts, the anti-cap-and-trade contingency who has…
Roughly one quarter of University of New Mexico students are unimpressed with the state’s flagship public school, according to a survey that questioned college students about their higher education experiences.
Photo by Jeffica
Albuquerque public schools could lose $5 million. Also gone possibly is $8 million earmarked for parks and sport fields in Bernalillo County.
But those numbers are dwarfed by the $13 million potentially lost to museums and other cultural entities in the state’s biggest county — or the nearly $12 million possibly pulled from road and other infrastructure projects.
These numbers come from a legislative analysis of a bill dropped Monday that would claw back $150 million from more than 1,500 “stalled” projects around New Mexico to beef up the state’s rainy-day account at a time that New Mexico is swimming in a pool of red-ink.
All told, Bernalillo County would see $44 million pulled from brick-and-mortar projects if the legislation passes as is, but every county would feel the bite.
Politically, this bill will get more eyes than most any other bill this session, save perhaps the state budget. Over the next few days, many state lawmakers will review the over 60-some-odd page list of targeted projects to see if any of theirs is on it. The gyms, senior centers and bridges built with state money are often viewed as tangible evidence of what the lawmakers are doing for the districts.
The legislation confronts two big challenges, said House Majority Leader Ken Martinez, D-Grants.
“In concept everyone’s for it,” Martinez said. But when state lawmakers look at the list they say, great list, except for my projects on it, the legislative leader said.
Then there’s the bigger challenge, what Martinez calls a “paperwork nightmare.”
That’s the process of making sure that every project on the list is indeed moving, and that a contract hasn’t been signed, which would “encumber” the state money.
The list was compiled over several months by staff from the executive and legislative branches — the governor’s Department of Finance and Administration (DFA) and the Legislative Finance Committee (LFC).
“There’s still disputes on the projects regardless of how much shakeout by DFA and LFC staff members,” said Sen. John Arthur Smith, D-Deming. “There are legal questions.”
For example, what exactly amounts to a contract, Martinez wants to know.
“We have a letter from a contractor” about a specific project, Martinez said, offering an example. “Is it a letter? Is it an invoice?”
The legislation planned for such a possibility, and includes a clause that says the state would honor contracts for brick-and-mortar projects.
It’s unclear how many projects on the list fit that description, or how much money would be lost due to overlooked contracts for brick-and-mortar projects.
But if enough state lawmakers become upset over the list, a fight over what projects to include in the bill could distract from the Legislature’s No. 1 goal: reaching a state budget deal.
The state is attempting to claw back the money from the projects because it is in sorry financial shape, including its reserves — money set aside for a financial rainy day.
Currently, the state’s reserves are below what they need to be, which is why the legislation was filed to claw back $150 million from capital. The money ultimately retrieved from the projects will revert to the reserves.
The state’s reserves for this year are at 2 percent. The goal is to have the reserves at 5 percent.
The 5 percent goal is important for two reasons, officials say. Credit ratings agencies in New York threaten to downgrade a state’s credit rating if reserves dip below 5 percent. A downgraded credit rating would mean the state would have to pay more to borrow money.
But perhaps more importantly New Mexico’s reserves now consist mainly of funds the state couldn’t get to easily — tobacco settlement funds. Those funds are locked and the Legislature would have to pass a law saying it was OK to use the tobacco settlement funds for a financial rainy day.
There, in fact, may be legislation floating around to enable the Legislature to do that, lawmakers said.
But for right now certain lawmakers are hoping the bill clawing back the $150 million from brick-and-mortar projects passes, so that money can beef up the state’s reserves.
