Inside the Capitol

Saturday, March 11, 2006

3-17 Legislative Feeding Frenzy

Syndicated Columnist
SANTA FE -- The 2006 legislative session was christened "the year of the child" by Gov. Bill Richardson in his opening day address.
Thirty days later, disappointed observers were renaming it "the year of the Senate" and "the year of the spaceport."
But when the governor finished line-item vetoing appropriation bills 20 days later, the most appropriate name appeared to be "the year of the feeding frenzy."
On opening day of the 2006 Legislature, Gov. Richardson warned lawmakers not to get into a feeding frenzy over all the new money available for pork projects in their districts. At the time, it appeared to be just a general caution that there was much work to be done. No one expected to hear any more about a feeding frenzy.
But a week before the end of the session, when the Senate passed its version of the general appropriations act, Richardson proclaimed that, sure enough, the Senate had gotten into a feeding frenzy and neglected his year-of-the-child proposals.
When the session ended, the governor observed that even though he received 80 percent of his year-of-the-child requests, lawmakers had gotten into a feeding frenzy and he would have to veto over $250 million dollars of pork in order to get the budget back in balance.
Normally, when a budget is out of balance, we are talking about recurring expenditures being more than projected recurring revenues. But Richardson was speaking of surplus money, the leftovers that are available for one-time expenditures.
At the March 8 deadline for signing and vetoing bills, the governor explained that it is necessary to have a 10 percent projected surplus for a budget to be in balance.
Ten percent surpluses are nice but for most of our state's existence, we have gotten along on five percent or less for use in case of emergencies. Wall Street bonding firms like to see large cash reserves, which may be one reason for the state's good credit rating.
But our credit rating always has been strong because the state constitution prohibits deficit budgets. Rep. Lucky Varela, recognized as the Legislature's top financial expert, expressed dismay at Gov. Richardson's self-imposed 10-percent surplus requirement. Varela said he thought a 7.5 percent surplus would be very adequate.
It now appears obvious what the governor is doing. In addition to being a tax-cutting governor, he's now a budget-balancing governor, albeit in a state that mandates a balanced budget. But he can tell of the fight he had to get the job done and keep spending in check.
Gov. Richardson also was upset that he didn't get a $250 million road bill he wanted. Presumably he would have vetoed that too. He then could have bragged about cutting over a half-billion bucks in spending. When it was all over, the state's general fund budget increased by 8 percent. Pretty generous for a tight-fisted governor.
In a previous column, we predicted the governor would use his announcement of signings and vetoes to make a statement about the special session he had threatened to call.
That's what he did. And as we predicted, he said there is little chance of a special session, and only after the June primaries. One major disadvantage of a special session in an election year is that not only does it take time from campaigning, no one can conduct any fundraising during that period.
And for the governor, the prohibition continues another 20 days after the session ends. That's not going to hurt this governor too badly, since he has no primary election opposition.
But Richardson knows how angry the 70 members of the House would be, since they all must stand for reelection this year. And if lawmakers are unhappy, there is little chance of the governor getting anything at all from the session.
FRI, 3-17-06

JAY MILLER, 3 La Tusa, Santa Fe, NM 87505
(ph) 982-2723, (fax) 984-0982, (e-mail)



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