On Thursday, the House GOP unveiled what Politico referred to as “the most controversial of spending bills” — a $153.4 billion measure that proposes to cut $4 billion in spending from the 2011 budget. House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies Chairman Denny Rehberg (R-Mont.) authored and introduced the bill (PDF), which presents controversial cuts to education, labor and health services, particularly to women’s reproductive-health services: It would eliminate the Title X family-planning program, ban federal funding to Planned Parenthood Federation of America (unless the organization ends its abortion services), redirect teen-pregnancy-prevention programming funds to abstinence-only sex-education programs and ban private insurance companies from covering abortion.

“We believe in protecting a woman’s ability to make personal, private decisions with her doctor, and Speaker [John] Boehner’s budget violates these fundamental American values in several ways,” said NARAL Pro-Choice America President Nancy Keenan in a statement Thursday. “How will taking away women’s freedom and privacy lead to the job creation he promised voters?”

Controversial still is how the spending bill was crafted.

After Rep. Rehberg posted the legislation online, Rep. Rosa DeLauro (D-Conn.), who sits on the subcommittee, issued a statement censuring the chairman for posting the draft before public debate and accusing the Republican majority of violating its pledge to follow regular legislative order in dealing with appropriations.

“I am very concerned by reports that the Chairman has no plans to convene a meeting of our subcommittee to consider and mark up this legislation,” DeLauro said. “While this posting of the Chairman’s proposals is interesting, it is by no means an acceptable substitute for public debate and amendment. The Chairman, by himself, is not the subcommittee. … If no House markup is held, this would be the first time in nearly a decade that our subcommittee has failed to report out a bill.”

DeLauro criticized Rehberg’s proposed spending cuts, which she said injects “40 brand new legislative provisions and riders, many of them highly controversial, and most dealing with complicated subjects well outside the expertise of the Appropriations Committees.”

She said that Rehberg’s bill prohibits use of federal funds to implement any part of the Affordable Care Act; nearly eliminates the Corporation for National and Community Services, which administers Americorps and related programs; cuts the nation’s job-training program by 75 percent (but protects reemployment programs for veterans); and prohibits public radio stations from using any federal funds to acquire programming from National Public Radio.

DeLauro warned of potential consequences of defunding Planned Parenthood.

“The main effect would probably be to prohibit Medicaid patients from choosing to receive services such as contraception and cancer screenings from Planned Parenthood clinics,” she said.

DeLauro noted that eliminating family-planning funding would likely impact about 5 million people annually.

New Mexico will be able to pay its bills for about 22 days if the federal government fully or partially halts payments to the state, according to Finance and Administration Secretary Rick May.

The Treasury Department says it has the legal authority to borrow until Aug. 2. The AP reports that federal government revenues account for a third of the state’s $15 billion budget, and $3 billion of that going towards Medicaid. The state has $1.4 billion in reserves and pays out about $65 million per day.

Moody’s placed New Mexico’s credit rating “under review” for downgrade, however, because of its reliance on the federal government for revenues (including Medicaid reimbursements), and number of federal employees.

Here’s a bright spot in the otherwise grim fiscal picture most states, including New Mexico, have found themselves in — the state will have more than $360 million in new revenues for the upcoming fiscal year, according to a report released yesterday to the Legislative Finance Committee.

For this fiscal year, the state will have over $120 million more in revenue than expected. The state will in total receive over $5.8 billion in revenue for the next fiscal year. The increase is likely due to higher oil prices.

The state closed a $333 million budget gap in FY 2011.

Much of the attention on corn-based ethanol has focused on the role that this supposedly renewable fuel is playing in driving up global food prices. Now environmental groups and some conservative politicians are pointing out another problem — corn-based ethanol consumes the bulk of federal funding on renewable energy and the big oil companies that blend the ethanol into gasoline are collecting subsidies to the tune of about $6 billion a year.

The Volumetric Ethanol Excise Tax Credit (or VEETC) is a 45 cents per gallon credit that goes to the refiner that blends the ethanol into fuel.

Because the government already mandates that ethanol be added to gasoline and bans the import of foreign ethanol, critics say that the VEETC is unnecessary to maintain supply and is now only a handout to the oil industry.

British Petroleum has not been open about the benefits it receives from the credit, but is widely believed to be the largest recipient of the credit.

The National Journal reported last year:

On BP’s website, the firm states: “As one of the largest blenders and marketers of biofuels in the nation, we blended over 1 billion gallons of ethanol with gasoline in 2008 alone.” Extrapolating from Energy Information Administration data on 2009 refining capacity, BP is estimated to have produced about 11.5 billion gallons of gasoline. If the company blended up to the 10 percent limit under current law, about 1.15 billion gallons would have been blended, translating to a $518 million tax benefit.

This credit wasn’t among those that the Senate considered scrapping weeks ago, but there does appear to be some political will to cut it.

Though presidential candidates are known to pander to the interest of farmers in Iowa, which holds the first conventions, campaigning in Iowa last month former Minnesota governor and Republican presidential candidate Tim Pawlenty said that ethanol credits need to be rolled back.

“We need to do it gradually. We need to do it fairly. But we need to do it,” Pawlenty said. “The hard truth is that there are no longer any sacred programs.”

Candidate Newt Gingrich — who has received hundreds of thousands of dollars as a consultant for the ethanol group Growth Energy — is among the few Republicans campaigning who have not endorsed cuts to the VEETC, according to Sheila Karpf, legislative and policy analyst for the Environmental Working Group, which has been tracking the issue.

Karpf said that the credit was intended to make gas with ethanol more affordable but oil and gas companies are allow to collect the subsidy no matter how much profit they make.

Government credits for ethanol blenders are also problematic, she said, because they drain off resources that could support better renewable energy options.

“Corn ethanol actually increases greenhouse gases in the near term,” she said. This is because ethanol is mostly made in facilities that burn coal and natural gas.

Corn ethanol was supposed to be a bridge fuel that would lead to advanced bio-fuels from algae, switch grass or other sources, she said, but the multiple federal incentives aimed at corn have stifled development of this potentially superior alternatives.

“The fact that we are still paying VEETC is crazy,“ she said, “a really bad waste of taxpayer money.”

Legislation to end the VEETC has bi-partisan support in Congress.

In March Senators Tom Coburn (R-OK) and Ben Cardin (D-MD) introduced a bill to repeal the VEETC.

“While there are a wide range of federal incentives available for ethanol production, the VEETC essentially provides free money for blenders who are already mandated by the Renewable Fuels Standard (RFS) to blend ethanol in fuel,” they said in a statement as they introduced the bill.

“Moreover, while born of good intentions, federal subsidies for ethanol have had less than satisfactory results. Ethanol-blended fuel is nearly a third less efficient than gasoline (ethanol burns at 68 percent the energy content of gasoline), has contributed to the increased price of corn (as well as land, feed, and other input costs), and can cause engine damage in motor vehicles.”

A March Government Accountability Office report recommended that Congress reconsider the VEETC and stated that the U.S. Environmental Protection Agency and the Treasury Dept. could save the federal government $5.7 billion by addressing duplicative efforts aimed at increasing domestic ethanol production.

A new poll from the Washington Post and ABC News reveals mixed messages from the American public over the country’s budget crisis.

With regard to fixing the federal deficit, trust in congressional Republicans edged out trust in President Obama by a slight margin, but on the issues, those polled were supportive of Obama proposals while rejecting Republican cuts.

Overwhelming majorities — 69 and 78 percent, respectively — oppose cutting Medicaid and Medicare. The budget favored by most Republicans, introduced by Rep. Paul Ryan (R-Wis.), would overhaul both programs, ceding control of Medicaid programs to state governments and replacing Medicare with a voucher system. Even if a Medicare voucher program didn’t result in cuts to coverage — a notion championed by Ryan but thoroughly refuted by experts (PDF) citing rising health care costs — 65 percent of respondents opposed vouchers generally and said Medicare should remain as it is today.

A full 58 percent disapproved of Obama’s handling of the deficit. This is a smaller number than the 64 percent who disapproved of congressional Republicans’ handling of the deficit, but still a significant majority. Yet 72 percent were in favor of raising taxes on those earning $250,000 or more per year. As previous polls have demonstrated, most Americans felt that a combination of tax cuts and spending cuts is the best approach to tackling the deficit — in this case, 59 percent.

On the whole, there was slightly more trust in Obama to handle taxes and protect the middle class than there was in Republicans. Similarly, 56 percent said Obama’s views on the issues were either “about right” or too conservative — compared to just 39 percent who said they were too liberal, while 55 percent said Republicans in Congress were either “about right” or too liberal.

Also throwing a wrench into obtaining a coherent picture of the national political compass in the poll is the fact that more people — 46 to 42 percent — trusted Republicans in Congress to handle the national debt over President Obama. The upshot of the poll seems to be a picture of an American populace that is either deeply confused or simply misinformed about the current situation in Washington.

Elsewhere, the poll results showed dissatisfaction with Congress across party lines on a level similar to that which has been expressed for nearly twenty years. Of the Americans polled, 63 percent disapproved of Republican job performance in Congress, while 60 percent disapproved of Democratic job performance. These figures are within a few percentage points of the results of every poll since 1994 (barring a period of slightly favorable views of Congress in the late ‘90s), when the Post and ABC News first asked the question.

The House stayed past midnight at the Roundhouse early Thursday morning to concur with changes that the Senate made to the budget and the film incentive cap, but the body failed to concur on the changes the Senate made on the retirement “swaps” legislation. The House will ask the Senate to recede from their amendments, and if the Senate doesn’t, the two houses would have a conference committee to iron out their differences.

If the two chambers cannot agree on changes, the budget will have a $110 million hole. The Gov. Susana Martinez would then have to veto $110 million from the budget.

Opponents of the retirement swap legislation have said that it is balancing the state’s budget on the backs of state workers. Supporters say it’s necessary to balance the budget in tough economic times.

The legislation would require state workers to contribute more to their state retirement plans and reduce the amount the state contributes to these plans.

Two years ago, the state required workers to contribute 1.5 percent more to their pension plans and reduced the amount the state would contribute. This bill, HB 628, would add 1.75 percent to that amount. The sponsor of the legislation, Rep. Donald Bratton, R-Hobbs, was concerned that the Senate did not make the increase permanent and urged members to vote against concurring with the Senate’s version of the legislation.

A majority of the House, however, did earlier vote to concur with the Senate versions of the budget and film incentives.

The budget did not undergo major changes in the Senate, and after a brief debate the House concurred with the changes on a 36-32 vote. The bill will now head to the governor’s desk where she will decide whether to sign the bill as it is, veto it or, more likely, make line-item vetoes of areas she does not agree with.

The budget reduces overall spending by around $152 million for the upcoming fiscal year. State spending will be reduced by 2.7 percent.

Rep. Brian Egolf, D-Santa Fe, said he thought the process of creating the budget was flawed and voiced his concern that Martinez said she would consider any revenue-raising ideas. Egolf mentioned combined reporting, which would tax out-of-state corporations on business done in New Mexico. Currently these companies can avoid paying state taxes.

Rep. Dennis Kintigh, R-Roswell, has long been an opponent of the film incentives and opposed the Senate’s move to increase the film cap to $50 million. He also said he did not agree with the decision to vote on concurring with the Senate’s version of the budget before the other two financial bills that many say are key to balancing the budget this year.

On a 51-17 vote, the House voted to concur with the Senate changes on the film amendment, and send the legislation to Martinez’s desk.

This year’s legislative session ends at noon on Saturday, Mar. 19.

The House passed the 2012 budget Wednesday afternoon on a 35-34 vote after the passage of just one amendment and the discussion of just two. Much of the time was spent discussing the second amendment, which eventually failed, and left the Republicans complaining that Democrats had wasted time to prevent amendments.

Rep. Thomas Garcia, D-Ocate, took up most of the time on the debate of HB 2, the $5.4 billion budget.

House Republicans said that “it appeared the majority party wanted to use up the three hour time limit rather than allowing a vote.”

“The people of New Mexico would be disappointed in this behavior and so are we,” said Rep. Tom Taylor, R-Farmington, in a statement shortly before the end, calling it “completely unfortunate” that “a single member of the majority easily took up over an hour of time in debate.”

One Democrat on the House floor during the debate on the first amendment to the bill argued that the amendment added $100,000 to the bill but did not take any money out of the bill. An argument many Democrats have made is that all members had a chance to work on the bill in interim committees.

But after the second amendment failed, the bill cleared through the House with no votes to spare.

Rep. Andy Nuñez, I-Hatch, was not present to vote, and Rep. Sandra Jeff, D-Crownpoint, voted against the Democrats and voted against the bill.

The bill will now head to the state Senate.

The debate in the House committee on Saturday was marked by close votes, people leaving the room and eventually a unanimous approval of the legislation. The KUNM Government Project was on hand for the debate.

When lawmakers left the hearing on Friday evening the annual aggregate was capped at $60 million, but Republicans thought they could trim it another $20 million.

And they almost got there.

After picking up picking up a single Democratic vote from Rep. Sandra Jeff, they lost House Minority Leader Tom Taylor’s initial support.

Taylor had been the bill’s co-sponsor, but announced at the start of Saturday’s hearing that he had withdrawn his name from the bill. After public comments Taylor walked out of the room when it came time for him to register his vote on Roch’s proposed $40 million cap.

With Taylor gone the measure failed on a 7-7 tie vote.

A bill must have a majority in order to pass House committees. After an hour of recess, the compromise cap of $45 million was proposed and passed on a unanimous vote.

The film rebate program currently provides direct cash payments to cover up to 25 percent of film production costs in New Mexico. Martinez has called for the rebates to be dropped to 15 percent.

The New Mexico Motion Picture Association said in a news release that it did not agree with the compromise bill.

“We cannot support what was passed out of committee, either as a way to balance the budget or to improve the efficiency of our incentive program,” NMMPA executive director Eric Witt said in a press statement Sunday. “Not only does the new bill threaten to destroy New Mexico’s vibrant film industry, it fails to address the $1.2 billion in subsidies paid out to other industries such as oil and gas, whose profits are proof that those industries need no subsidy from New Mexico’s working families.”

The impasse between Democrats and the governor is seen as one of the main sticking points in crafting the budget.

Gov.-elect Susana Martinez promised not to cut education or Medicaid funding in her campaign, but given that New Mexico’s budget deficit has grown from $260 million in July to $450 million, she is changing her language, reports Heath Hasmussen:

Martinez said repeatedly on the campaign trail that she opposed any cuts to education and Medicaid. But at a news conference on Friday, she instead talked about protecting “classroom spending” and “basic health care for those most in need.”

“Closing what we learned yesterday to be a half-billion dollar deficit is going to be a challenge,” Martinez said at the news conference. “During the campaign, we had deficit estimates that started around $80 million. Suddenly, we’re now at half a billion.”

“…In tackling that challenge, we must protect critical government services, such as classroom spending and basic health care for those most in need,” she said.

Susana Martinez

Republican Governor-elect Susana Martinez said Wednesday that layoffs of state workers isn’t her first option, but she acknowledged that the possibility isn’t off the table.

“I would like not to have layoffs,” Martinez said Wednesday at an Albuquerque news conference. “People are already in furloughs in state government. We have to make sure we are providing the necessary core services and so I would never say they are off the table.

Fixing New Mexico’s state budget will dominate the legislative agenda as Martinez and state lawmakers learn to work together starting in January to close a $260-million gap in the 2012 budget after the state already has cut costs and raised revenue during previous legislative sessions.

Martinez made promises on the campaign trail that might prove difficult to keep.

The governor-elect  promised not to raise taxes in her first year at the same time she promised not to cut two of the largest areas in the state budget — public education and Medicaid, the government’s low-income health insurance program. Education and Medicaid make up 60 percent of the state budget.

Martinez said Wednesday that there were 3,000 vacant state jobs around New Mexico state government. But it was unknown how much of a savings New Mexico would net from eliminating those positions because it’s unclear how many of the vacant jobs are actually funded.

“Some are and some are not. We’ve received just yesterday a pile of documents about this thick,” Martinez said, indicating several inches of documents her staff will review to determine how many positions are funded.

Martinez already has said she wants to shrink the number of political appointees scattered throughout state government. But doing away with from 200 or 300 of those positions wouldn’t come close to filling the $260 million budget shortfall.

The governor-elect also acknowledged she still intends to sell the state jet, which became an issue during the governor’s race.

“I definitely do want to sell it,” Martinez said. “We have to look at what the market looks like and certainly looking at the planes and how many we have … I understand there are several helicopters. We want to take a look and see where we are with that.”