Inside the Capitol

Tuesday, July 19, 2011

7-22 Good News. Revenues Up

Syndicated Columnist

SANTA FE -- Good news. The state's economists say our revenue outlook is improving, mainly due to a larger than expected increase in gross receipts tax and energy royalties.
This may be an indication that our state has weathered the worst of its three-year economic downturn. The way economists figure it, if revenues continue to increase more than expected for the next quarter too, they can say we are in recovery mode.
The gross receipts tax rebound is especially good news. Nearly all businesses file on a monthly basis. That tells us on a regular basis how business in the state is doing. And apparently business is improving.
As of now, however, Gov. Susana Martinez is telling state agencies to submit zero-based budgets for the next fiscal year, beginning July 1, 2012. We're not going to see this administration getting excited about spending money anytime soon.
One of the Martinez administration's biggest headaches is what to do about the Rail Runner commuter train between Belen and Santa Fe. Solving the problem of securing more revenue is complicated by the fact that it is a joint problem.
The Rio Metro Transportation Authority runs the railroad. The four counties served by the railroad each contribute a one-eighth cent gross receipts tax to the project. Passenger fares also provide some revenue.
But the original idea came from former Gov. Bill Richardson, who agreed the state would provide 25 percent of the train's operational costs in addition to borrowing money to buy the track and trains.
Evidently that agreement never was put in writing and his successor, Gov. Susana Martinez isn't sure she wants the train to continue.
Another problem is that Gov. Richardson never identified a revenue stream to fund the state's 25 percent. Richardson used federal stimulus money to pay the state's share. That money no longer is available.
If Martinez continues to fund 25 percent of the train's revenues, she'll have to find the money somewhere. Martinez has little reason to help Richardson with his legacy.
The transportation board's first money-saving idea was to stop the weekend runs. That hit Santa Fe businesses hard because weekend riders are the ones who eat and shop.
Santa Fe officials complained and hinted at helping support the weekend trains financially. Economists also testified that healthy weekend ridership is a long is a long run benefit.
Gov. Martinez may hold the keys to whether the railroad is a success or failure. Unfortunately, some $800 million in bond payments by the state are going to have to be made over the next 16 years whether the trains run or not.
As we have told you previously, Gov. Martinez has been criticized for not showing up at events to which she has committed. But she did come through on a commitment to the New Mexico Children's Foundation to appear at a "Dancing With the Stars" fundraiser in Santa Fe last weekend.
Martinez, who won a major dance contest for a Dona Ana County charity, reportedly wowed the Santa Fe crowd with some very fancy footwork. That may be a skill that will come in handy with lawmakers during the September special session on redistricting.
The decennial session to redraw boundaries of legislative and congressional districts always is tense because there is nothing more important to politicians than their seats.
Gov. Martinez is currently aggravating legislators even more by adding a number of items to the redistricting agenda. Every problem that arises seems to add to the governor's special session agenda.
Interestingly, the news prior to a special redistricting session usually has to do with redistricting concerns. Some areas of the state stand to lose their legislative district or be combined with a neighboring district.
But instead of redistricting concerns, nearly all the coverage so far has been about the extra items Gov. Martinez is adding to the special session agenda.
FRI, 7-22-11

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



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