The superintendent of a small school district in Southern New Mexico told state lawmakers in no uncertain terms Tuesday how a 5 percent or 6 percent cut in his operating budget would affect his district. “Our teachers work very hard to put hope in front of those kids,” Ricky Williams, superintendent of Hagerman Municipal Schools, told members of the Senate Finance Committee. “With budget cuts, you take that hope away.” Williams was one of several district leaders and college presidents who put a human face on the realities of education funding cuts during a three-hour hearing at the state Capitol, which attracted about 150 people — many of them educators. Garrey Carruthers, president of New Mexico State University in Las Cruces, told the committee that colleges and universities may have to hike tuition rates by up to 30 percent to offset budget reductions.
Senate Minority Leader Stuart Ingle was in office 15 years ago, the only time the Legislature overrode a governor’s veto of the entire state budget. That showdown pitted Republican Gov. Gary Johnson against a Legislature controlled by Democrats. Ingle, R-Portales, said he is confident the impasse this year over spending and tax increases between majority Democrats in the Legislature and Republican Gov. Susana Martinez will not be a repeat of what happened in 2002. He said all parties agree on the priorities. Namely, the state needs to boost revenue to pay for education and day-to-day services included in the proposed $6.1 billion operating budget and stash away more in savings to help its credit rating.
The New Mexico Senate, hoping to improve state roads and rebuild cash reserves, approved a bill Thursday that would increase the state gasoline tax for the first time in more than 20 years. But the bill has little chance of becoming law. “If it reaches the governor’s desk, she will veto it,” said Chris Sanchez, a spokesman for Republican Gov. Susana Martinez. An override of Martinez’s veto is unlikely because the tax bill received support from only three of the Senate’s 16 Republicans. The measure, Senate Bill 95, would raise about $180 million annually through a range of taxes and fees.
A quarter of New Mexico’s roads are in bad condition according to a new report from a Washington D.C. nonprofit. And ripped up pavement and bumpy roads aren’t just an inconvenience, they’re also costly to car owners in the state. On average, bad roads, traffic congestion and poor traffic safety conditions cost Albuquerque drivers more than $1,800 each year, according to the report by the transportation policy research group TRIP. Released last week, TRIP’s “New Mexico Transportation By the Numbers” report is based on publicly available data from sources like the American Automobile Association, the Texas A&M Transportation Institute and the National Traffic Highway Safety Administration. Albuquerque’s roads are the worst for any city in the state, according to the report, with 34 percent of them in poor condition.
State lawmakers say revenues are no longer deteriorating but remain flat, and they are moving forward on a 2018 budget with proposals to infuse new revenue — including tax increases — to balance spending and replenish reserves. A new consensus revenue estimate for fiscal year 2018 was expected to be released Wednesday but was pulled back for more study. Still, lawmakers said they do not expect a significant change from December, when economists were forecasting a $125 million deficit for the 2018 fiscal year, which begins July 1. “I don’t believe there’s going to be a material change,” Sen. John Arthur Smith, D-Deming, told the Senate Finance Committee. A forecast presented halfway through last year’s legislative session showed state revenues cratering from the collapse of crude oil prices.
The State Auditor released its annual ‘At Risk List’ of public entities that failed to submit their mandated audits on time. Three state agencies, four counties, four school districts, one college and ten municipalities failed to submit their annual audits. One entity had an audit opinion that found “significant problems with its financial statements” per the State Auditor press release: The Town of Estancia. State Auditor Tim Keller said in a statement why the list was important. “The ‘At Risk List’ helps policymakers and the public easily identify which entities are behind schedule or reporting financial information that often isn’t cutting it,” he said.
Republicans and Democrats on Monday threw their support behind a proposal to collect gross receipts tax from major internet retailers such as Amazon and eBay. Legislators have considered several similar proposals in recent years, but backers of House Bill 202 hope that the state’s budget crisis, a changing legal landscape and bipartisan support will send this measure to Republican Gov. Susana Martinez. She has steadfastly opposed all proposals to raise taxes. But other Republicans who have been similarly wary of anything that sounds like a tax increase said during a meeting of the House Business and Industry Committee that they see the bill as ensuring fairness for small businesses competing with internet companies that do not have to pay the state’s 5 percent gross receipts or local taxes. “It’s really just closing a loophole,” said Rep. Monica Youngblood, R-Albuquerque.
Gov. Susana Martinez signed three bills Tuesday to balance the state’s budget, taking about $46 million from the reserves of public schools. But she vetoed cuts to an economic development program and various accounts in New Mexico government. The bills could raise $190 million for the state’s general fund, closing a deficit that was projected to total about $80 million. The measures also will replenish government reserves, though not nearly to the extent of plans proposed in early January by legislative staff and the governor’s own administration. The package will leave the state’s cash reserves at 1.8 percent, rather than nearly 3 percent as previously proposed.
New Mexico’s Road Fund was once considered a pot of money that would keep growing as more people in the state bought higher-priced cars and trucks, then drove extensively for business and recreation. Part of that has come to pass. With three interstate highways crossing New Mexico, increased trucking activity and record tourism, drivers are logging more miles. But they also are buying less gasoline, and the fund for road improvements and maintenance has stagnated. “We’ve seen an increase in traffic in New Mexico,” said state Rep. Larry Larrañaga, R-Albuquerque, a member of the House Transportation Committee.
When state Human Services Secretary Brent Earnest goes before lawmakers to speak about his budget for the Medicaid insurance program, many want to run for cover. One year, he needed as much as $100 million from the general fund to fully pay for all the new enrollees under the federal Affordable Care Act and provide the same level of service. Last fall, he said he needed another $80 million for the fiscal year that begins July 1. On Thursday, he told the House Appropriations and Finance Committee that request had dropped to $42 million. “This is a significantly better picture than you saw in the fall,” Earnest said.