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.
One of the biggest duties of the state legislature this year will be dealing with the decennial redistricting of congressional and legislative seats following last year’s U.S. Census. The state legislature posted preliminary data on redistricting on its website Wednesday for congressional, state House, state Senate and Public Regulations Commission seats.
Republican Gov.-elect Susana Martinez spoke with the Las Cruces Sun-News in one of the first in-depth interviews the Dona Ana County prosecutor has given since winning the election Tuesday of last week.
Closing the state’s budget gap is her…
A powerful state senator lashed out against the corrections secretary this week as lawmakers eyed $18 million in penalties Williams decided not to levy against private prison companies, including his former employer. Williams has said his decision was based on the good job the two companies had done operating four facilities.
Susana Martinez has pledged to sell New Mexico’s state jet if elected—but she told The Independent she would not sell two other aircraft that cost almost as much to operate. Martinez would use the other planes for “emergency situations or official state business that is a priority,” according to her campaign. Flying the jet—a Cessna Citation Bravo—costs $2,852 per hour, compared to $2,346 per hour for the state’s King Air and $2,347 for an older Turbo Commander.
New Mexico built its current state budget on the assumption that Congress would extend stimulus funding for Medicaid through the end of the fiscal year, next June. Right now the extra funding ends Dec. 31, 2010.
Sen. John Arthur Smith, D-Deming, told The Independent he’s already preparing for the possibility that Congress, even if it acts, won’t cover the full $160 million the state budgeted in anticipation of the federal dollars.
But in Georgia, Gov. Sonny Perdue has already ordered leaner state agencies to cut another 4 percent in spending starting next month because the state’s new budget relies on federal stimulus dollars that might not come, the Atlanta Journal-Constitution is reporting.
New Mexico is $160 million in the hole three weeks into the new fiscal year, state officials learned Wednesday.
And that hole could double in size if Congress fails to send extra stimulus dollars New Mexico’s way to help pay for Medicaid, the government’s low-income health insurance program.
It’s not exactly the kind of political climate gubernatorial candidates would prefer.
“The next governor is going to have her hands full,” Sen. John Arthur Smith, D-Deming, and chairman of the Senate Finance Committee, said Wednesday, confirming the challenges ahead for the next occupant of the governor’s mansion.
The two women running to become New Mexico’s next chief executive responded Wednesday to news of the worsening financial news with plans on how to address the problem that varied in degrees of specificity. But not before taking swipes at each other.
“While my opponent has put forward thin one-liners and platitudes, my plan tells New Mexicans exactly how I propose to cover the budget gap,” Democratic Lt. Gov. Diane Denish said in a statement.
Republican District Attorney Susana Martinez shot back: “Diane Denish’s scheme is just more of the same Enron accounting that created this budget mess.”
Both candidates pledge to cut political appointees
Three and a half months before Election Day, Denish’s and Martinez’s plans to address the state’s budget woes reflected a mixture of gritty realism and pie-in-the-sky election-year promise-making at a time when New Mexico finds itself foundering financially.
Martinez, whose campaign sent out a 364-word statement, promised to implement zero-growth budgets at most state agencies and rid state government of waste and fraud. She said she could find 5 percent to cut, but didn’t go into too much detail about how to accomplish that goal.
Denish, whose campaign sent out a six-page report issued earlier this year, touted a voluntary one-time buy-out she would offer to state government workers and a thorough review of tax credits to make sure they create jobs. If they don’t, Denish would push to have them eliminated. What she didn’t mention is that such a review likely would take months, and wouldn’t save money this year.
Reducing the state’s vehicle fleet by 10 percent and merging several state agencies, thereby eliminating several cabinet-level positions and salaries, were other ideas Denish offered while Martinez talked of shrinking the state’s payroll through attrition.
While the two candidates played up their differences, there were similarities. Both promised to eliminate the hundreds of jobs across state government held by political appointees – a measure expected to save $8.8 million a year.
Both in the past also have mentioned reforming how the state doles out money for brick-and-mortar projects, also known as pork, an often-touted goal that somehow never found enough support among state lawmakers to become a reality during the past 7 1/2 years.
Everything is on the table—including education
Both gubernatorial candidates made clear Wednesday that while they were ready to cut expenses while eschewing major tax increases, they were prepared to protect the most basic services, including education.
It’s a scenario some lawmakers have questioned: keeping K-12 education untouched in future budget cutting. Education has suffered cuts in the past, but K-12 education is a big target, representing roughly half of the state budget.
“We can’t hit agencies” like the state transportation department any more, Sen. Steven Neville, R-Aztec, said Wednesday. “We might have to talk about wholesale elimination of functions. We may have to say we can’t provide XYZ anymore. Or the big taboo – education. We are going to have to re-look at education – at administration and overhead.”
Agreed Smith: “Everything on the spending side is on the table, including education.”
Sen. Dede Feldman, D-Albuquerque, however, said she was hard-pressed Wednesday to name where the state could cut in education.
“All I can tell you is I just finished talking to a … school nurse,” Feldman said. “People (at Albuquerque Public Schools) are really worried about what will happen this school year. We have a school principal covering two schools. School nurses who are covering more and more kids.”
Feldman also wondered if the state’s health system could take any more hits.
Funding for 33 county and community health councils and five Tribal Health Councils around the state already has been slashed this year because of the state’s budget troubles. The councils coordinate different agencies, organizations, in a community or county, that are addressing health needs at the local level, advocates have said.
“Doing away with these planning councils … it’s like your plane is about to crash and you are ripping out your control system,” Feldman said. “If we are looking to make a safe landing … we cannot afford to keep cutting those vital programs.”
No first-year governor will want to sign tax increases
“We have to look at what the situation is during the regular session,” Feldman said.
Smith ruled out a major tax increase as impractical, saying a first-year governor wouldn’t want to sign off on a tax increase to start off her tenure, he said. Smith acknowledged, however, that lawmakers would discuss – and likely would be open to– closing certain tax credits, deductions or exemptions.
Wednesday’s news wasn’t a surprise to him, Smith said. He and other senators had predicted that the Richardson administration’s projection that revenues would grow by 6 percent was overly optimistic. In the end revenues have grown by about 3 percent.
He also said the news could get worse.
New Mexico is one of 21 states without a contingency plan if Congress doesn’t pass legislation approving extra Medicaid dollars to shore up state spending plans.
Congress is currently debating whether to extend extra federal dollars for the government’s low-income health insurance program through June 30, 2011, six months beyond the current deadline of Dec. 31. If the extra dollars don’t come, however, New Mexico will be stuck with a $160 million hole in the state budget, meaning the current $160 million hole could double in size. That’s because this year’s state budget assumed the extra Medicaid dollars from the federal government.
Governor has authority to cut now
Martinez and Denish might have one saving grace. This year’s state budget gives Gov. Bill Richardson the ability to cut monthly allotments to agencies across state government, meaning some of the hard work of balancing this year’s budget actually might occur before the next governor takes office.
“Agencies have been preparing for a potential shortfall and, as a precautionary measure, were instructed to reduce spending by as much as 5 percent at the start of this fiscal year,” said Nicole Gillepsie, spokeswoman for the Department of Finance and Administration, the governor’s budget arm. “Agencies are hard at work finding ways to achieve maximum efficiency with the aim of avoiding reductions to services or additional cuts focused on state employees.”
Gillepsie also said the governor is “working to develop a plan for reducing agency budgets, and will present the plan for Legislative Finance Committee review and Board of Finance approval.”
Smith said he doesn’t hold out much hope that much cutting will occur before the next governor takes over.
“I don’t think this governor is going to move quickly enough,” Smith said.
The governor’s office did not respond to an e-mail from The Independent asking for a response to today’s news of the state’s worsening financial situation.
In 2014, the federal government will pay 100 percent of health care costs under Medicaid, the government’s low-income health care program, thanks to the new federal health care reform law. But between now and then the health care portion of New Mexico’s state budget could soar as more people enroll in the government program and federal stimulus dollars disappear.
Gov. Bill Richardson is deliberating whether to veto a controversial food tax provision in legislation state lawmakers sent him last week, saying he doesn’t want to balance the budget on the backs of ordinary citizens. But one state lawmaker is questioning the depth of Richardson’s stated concerns over how the provision will affect the state’s population, describing the governor’s public protestations as a “dance.”
About $11 million that the state could collect from a proposed a 75-cent increase to the state’s cigarette tax would be partly used to fund early childhood development under a proposal a powerful state Senate committee approved Thursday morning. But…
It took a 30-day regular session and almost three days of a special session to hammer it out, but New Mexico finally has its budget for the 2011 fiscal year. After debating the measure for about two hours Wednesday night,…
Sen. John Arthur Smith, D-Deming, said Wednesday that the Senate omnibus tax bill, including a food tax, is so key to fixing the state’s budget that if fails to pass the House cleanly (without amendments), “Then it’s back to…
Late Tuesday the Senate passed a bill that would generate $240 million by increasing the state’s gross receipts tax by a 1/8 of a penny, closing a state income tax deduction used by people who itemize and requiring the state’s compensating tax to be paid on goods purchased from out-of-state sellers without a physical presence in New Mexico.
The numbers are big and the money bigger, but the bottom line is New Mexico could find $280 million to help fix its budget. Rep. Dennis Roch, R-Tucumcari will try to bring an amendment to the state budget bill that…
A bill to boost the state’s cigarette tax by 75 cents cleared an important legislative committee Tuesday afternoon, after a bit of arm-twisting and some last-minute horse trading by two Democratic lawmakers. The sheer effort to push the bill out of the House Taxation and Revenue Committee gives one a sense of how difficult the New Mexico Legislature is finding it to pass out a state budget.
The state budget deal legislative leaders reach may generate $233 million in new revenue, in part by taking back $70-$100 million it has been sending each year to New Mexico cities to help compensate for the lack of a food tax. In return, cities would get the authority to tax food up to 2 percent. Also in the works: education cuts, a gross receipts tax hike and two versions of a cigarette tax hike.
Legislative leaders have struck a budget deal, and just in time. Details are few, but Gov. Bill Richardson saw it Friday and pronounced it good. Here are the general outlines of the deal. The recently struck deal involves raising $233 million in revenue. That revenue would come from increasing the state’s gross receipts, cigarette and compensating taxes. Certain foods also would be taxed for the first time in years, although it’s unclear what food items would fall under the state’s gross receipts tax. The proposed budget agreement also relies on spending decreases. State agencies are expected to shave spending. Public education, meanwhile, would be reduced by about 1 percent.
Legislative leaders were at the Roundhouse Thursday for a third day of “intense, behind-closed-doors talks and one key Senator said they were almost exactly in the same place they were when the session ended a week ago.
High-powered lawmakers are in Santa Fe today trying to persuade Gov. Bill Richardson to delay the special session planned for tomorrow.
House leadership is already meeting with Richardson, said Sen. John Arthur Smith, D-Deming, and chairman of the…
Sen. John Arthur Smith, D-Deming, says a special session is now a “certainty” because the Legislature “just flat ran out of time” to come up with a budget compromise.
Legislative leaders are running out of time to finalize a state budget package, but a deal must come together by tonight in order to clear the logistical hurdles of passage. If no deal is made, leaders agree they must claw back capital $130 million in outlay funds to make sure the state doesn’t start bouncing checks.
