Inside the Capitol

Wednesday, September 16, 2009

9-23 Special Session Difficulties Arise

Syndicated Columnist
SANTA FE -- The special budget session of the New Mexico Legislature appears headed for late October, according to Gov. Bill Richardson, who gets to make that decision.
Lawmakers had hoped for an earlier session but they and the governor are not as close to agreement as had been anticipated. Richardson wants a three percent across-the-board cut of all agencies, excluding education. Lawmakers want a four percent cut everywhere.
Both parties had generally agreed to no furloughs, no layoffs, no tax increases and use of some more surplus funds. But legislative leaders want to take a more cautious approach than the governor. They want to look more than a year down the road. Richardson only has a year left in office.
It isn't pleasant cutting close to nine percent out of a $5.5 billion budget but some states have had to trim more like a quarter of their budgets.
Big states and big cities have been hit hardest, along with states that were developing rapidly. That includes some of our neighbors. California, Arizona, Nevada, Las Vegas and Phoenix have suffered greatly.
California has had to lay off 28,000 public employees so far. Almost half of those are teachers. Arizona has had to lay off 4,300 public employees. In Nevada, layoffs total 2,200. Layoffs nationally total over 111,000 employees, including 40,000 teachers and 4,000 police and firefighters.
New Mexico, Arkansas, Delaware, North Dakota, Oklahoma and West Virginia have reported layoffs in the single digits. Gov. Richardson and lawmakers both seem determined to avoid layoffs and they hope to avoid furloughs if at all possible.
In several states public employee unions have agreed to furloughs in return for a guarantee of no layoffs. But many aren't so lucky. Hawaii, on top of 1,339 layoffs, has mandated that state workers take three days of unpaid leave per month for the next two years.
The Center on Budget and Policy Priorities indicates that 48 of the 50 states face budget shortfalls and the total shortfall for the nation is expected to get worse before it gets better.
At this point, federal stimulus money is helping many states avoid additional layoffs but that isn't likely to be continuing. If that stops before state economies turn around, layoffs will increase.
Nineteen states currently are furloughing employees. On top of California's 28,000 layoffs, all employees must take unpaid leave every other Friday.
In New Mexico, Gov. Richardson has appointed five members of the executive branch to sit down with legislative leaders to work out a suitable plan to present to the special session of the Legislature.
The five members are Department of Finance and Administration Secretary Katherine Miller and Deputy Secretary Dannette Burch, Taxation and Revenue Secretary Rick Homans, and the governor's deputy chiefs of staff Eric Witt and Paul Ritzma.
Gov. Richardson has provided them with a five-point plan to get discussions started. In addition to three percent cuts and use of $91 million stimulus money to prevent cuts in public school funding, the plan includes diverting $135 million in short-term bonding proceeds from future capital projects to operations and de-authorizing $60 to $75 million in previously approved building projects.
Lawmakers are likely to bow their backs at using one-time building money to fund ongoing operational expenses. If the economy doesn't turn around big time next year, the problem becomes that much worse the following year.
With disagreements such as these ahead of the joint committee, it is possible there will be no agreement before the special session. In that case, a quick weekend session now envisioned by the governor could last as long as 30 days.
Decisions need to be made soon. The judicial branch of government has already indicated it already is on the edge with the two percent cuts already imposed by last winter's session. Last week the state temporarily bailed out a district court but that can't continue.
WED, 9-23-09

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



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