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State lawmakers sent Gov. Bill Richardson a message Wednesday evening: You have to share in more in the state’s budget pain, Governor.
Lawmakers stripped millions of dollars from high-profile projects and initiatives Richardson has lobbied and pushed for around the state.
Among the targeted items: a highway interchange in Belen already under construction; film/media production facilities and a proposed equestrian facility in Albuquerque. State money meant to help a solar plant in Belen also was targeted.
The Senate Finance Committee voted unanimously to add the projects to an already-bulging capital outlay bill (SB182) that targets more than 1,500 brick-and-mortar projects around the state.
“The governor has the final say,” Sen. John Arthur Smith, D-Deming, chairman of the Senate Finance Committee, said of the projects’ inclusion in the bill. “If he wants to line-item veto, he can.”
Lawmakers are struggling to close a budgetary shortfall estimated at several hundred million dollars. The gap is between the amount of revenue coming in and the cost next year of keeping services at their current level.
And the bulging capital outlay bill could be a linchpin to the 30-day session. If passed, it would claw back more than $130 million in state money to beef up the state’s reserves, or rainy-day fund.
But many lawmakers felt that the bill didn’t include enough of Richardson’s pet projects.
The political symbolism of adding the governor-backed projects to the capital outlay bill was all the more striking because their inclusion in the capital outlay bill won’t immediately help the state’s bottom line.
Most of the governor’s projects are funded by a different revenue source than the general fund, the state’s main account. The budgetary shortfall is in the general fund.
The vast majority of the governor’s projects targeted Wednesday are funded by severance tax bonds. That means whatever money the state collects by sweeping those projects of unspent dollars will go into the state’s severance tax fund.
None of the governor’s representatives attending the Senate Finance Committee wanted to respond to the lawmakers’ decision to include the projects.
The different projects
Among those projects targeted perhaps the highway interchange has earned the most scrutiny over the years.
Jim Foster of then RS Investments, now Coast Range, contributed $75,000 to Richardson’s re-election campaign in 2005. The firm’s officials met with administration officials in early 2005 to talk about an exchange on Interstate 25, which runs north-south through New Mexico. And the $75,000 contribution came about a month later.
Foster donated use of his personal jet to the governor for two campaign trips to California that same year.
Since then the governor has been helpful in setting aside money for it. The administration earmarked $4 million in state money for the highway interchange in 2007.
Coast Range is hoping to develop a huge multi-use development in Belen, with a proposed $800 million Signet Solar plant anchoring its first phase.
The I-25 interchange project is being expanded to accommodate future traffic.
But the Signet Solar project has encountered trouble getting the facility up and running.
The $840 million solar manufacturer was unable to secure a loan guarantee from the U.S. Department of Energy for the first phase of its project. That decision is being appealed.
But with the trouble, the lawmakers saw the opportunity to target the projects.
“Obviously we’re disappointed to see both of these projects added to SB 182 at the last minute,” said J.D. Bullington, a registered lobbyist for Coast Range Developers. “With respect to the Belen interchange project, construction is already underway and I believe a large amount of that $3 million has already been expended.”
Like any other project in the bill, if any portion of money has already been spent or is under contract — encumbered in Capitol jargon — the state wouldn’t try to recoup those dollars. Language in the the bill exempts money that is under contract. The state would only recoup money that is unspent and already spoken for.
Less than $1 million remains of the state money dedicated to the interchange, state officials said.
Lawmakers also pulled nearly $3 million earmarked for infrastructure to help Signet Solar construct its plant.
“With respect to the Signet Solar money that project is still viable and the company is pursuing a Department of Energy loan guarantee,” Bullington said.
Another high-profile project pushed by the governor is the equestrian facility, which lawmakers have targeted in previous years.
More than $7 million was targeted on the proposed equestrian facility at the New Mexico Expo at the state fairgrounds in Albuquerque, as was $7.7 million for film and media production facilities.
It was unclear Wednesday night how much money the state actually would recoup from each of the governor’s projects because some money is already under contract in many of the items, state officials said. All told, the governor’s projects that were added had tied up more than $50 million in state money, but only $20 million remained unspent, one official said.
The capital outlay bill next goes to the Senate floor for a vote.
