April 4, 2017

Governor’s false fiscal crisis is hers alone

Gov. Susana Martinez’s proposed threats that grabbed headlines across New Mexico are not a solution to the state’s financial difficulties. She recently claimed that “we are staring down the path of a government shutdown,” and vowed unpaid furloughs of state employees and other draconian measures to save money. None of this needs to happen. It is a reckless and unnecessary approach to our state’s and our communities’ very real challenges.

All of this comes as the Governor prepares to veto a responsible, balanced $6.1 billion budget that a bipartisan Legislature passed. She intends to keep her campaign promise to veto any tax increase, even if the state suffers irreparable harm and its current problems worsen.

Howie Morales is a Democratic state senator who represents Senate District 28. Morales sits on the Senate Finance Committee.

The state was facing a $350 million shortfall to maintain current services next year. It required hard work and courage by Republican and Democratic senators to solve, but solve it we did, by legislating new revenues such as increasing the gas tax and closing unfair tax loopholes. The Senate passed its balanced budget for next year by a vote of 34 to 4, and erased the shortfall with new revenues by a vote of 33 to 8.  We protected the priorities of schools and public safety from cuts, and established healthy reserves of 3 percent to protect our bond rating.

The legislature’s FY ’18 budget was much better than the alternative pushed by the Governor. Hers’ would have cut the take-home pay of 70,000 teachers, nurses, law enforcement and state workers who make our communities function every day. We already have some of the lowest median wages in the country.

Taking away three and a half percent of families’ paychecks every week would deliver a body blow to local and rural economies.  In many communities, school districts are the major employer. Cuts in teachers’ pay would be felt by small businesses, retail, services and restaurants, leading to more job losses. We already have the highest unemployment rate in the nation at 6.7 percent.

To the surprise of all, the Governor announced last week that we will run out of money in the current spending year that ends on June 30th, FY ’17, without a government shutdown. But the legislature passed a budget solvency fix in the first days of this year’s session with her agreement. It too was accomplished with strong bipartisan support.

The solvency fix balanced our state budget, even though she had made it more difficult by vetoing $50 million worth of needed cuts along the way. Those vetoes left us with only 1 percent in reserve balances, a dangerous and historic low. Thin reserves of this kind threaten another downgrade of the state’s bond rating. If that occurs, it will make the cost of borrowing money more expensive in the future. It is irresponsible.

Instead of signing the common sense budget and package of revenues for the coming year that the legislature sent her, the Governor now intends to call the Legislature back at a cost of $50,000 per day. There is no need for it.

While it is true that our state revenues depend heavily on oil and gas receipts, it is deceptive to say it is only low oil and gas prices that caused our budget problems, as the Governor does. Surrounding oil and gas states such as Colorado and Texas are thriving. What is the difference?

The Governor’s policies have created consistently negative economic results. Going on eight years, New Mexico today is still in a deep recession.  For most people, decent-paying jobs are hard to come by.

We cannot turn back the clock.  We want a budget that protects residents’ most pressing priorities—K-12 classrooms and job creation—without making life harder on families and children.

The new revenues and budget passed recently by a bipartisan Legislature are the only tools to prevent more deep cuts to essential services.  The governor should do no further harm, and sign the revenue package to avert a social and economic disaster.