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Thursday, March 21, 2019

With Legislative Session In The Rearview Mirror ABQ City Election Comes Into Focus, Plus: Optimists Beat Pessimists In State's Financial News 

Now that the legislative session is over the city of ABQ Nov. 5 election is starting to come into focus, with the first candidates surfacing. The latest news is that a strong challenge has developed to longtime Dem City Councilor Ike Benton.

29 year old Zack Quintero, president of the NM Young Democrats, a NMSU grad and a current student at the UNM School of Law, says it's time for  a "transition" from Benton and he is off and running with a formal announcement set for March 24.

District Two takes in Barelas, Downtown, parts of the North Valley as well as neighborhoods near the UNM law school.

Benton has already announced he is seeking another four term. He was first elected to the seat in 2005. Quintero says Benton's support of controversial transit projects like the ill-fated Central Avenue ART project will be a major issue as well as public safety. We'll have more on the race soon.

There are three other seats up for election on the nine member council which is controlled by the Dems, 6-3.

In District 4 in the NE Heights, Republican Brad Winter, the longest serving councilor, has not yet announced if he will seek another term. In District 6 Dem Pat Davis is expected to go for re-election and is heavily favored in the early going, although he is expected to have opposition. In District 8, incumbent Republican Trudy Jones has not yet made public her intentions.

Candidates are now making declarations with the city clerk on whether they will seek public financing which both Benton and Quintero say they will do. In May candidates will begin collecting the necessary petition signatures to win a spot on the November ballot.

Speaking of the ABQ City Clerk, history buffs take note:

Did you know the Office of the City Clerk maintains historical minutes of City Council meetings dating back to 1890? For the next month we will provide a weekly post on what was happening with #CABQ in the 19th and 20th centuries!

Hey, maybe they have the crime stats from the 1890's? That might make us look pretty good today.

NOT FOR PESSIMISTS

For a change the pessimists must be grinding their teeth because the good news about NM's finances just keeps coming. The price of oil touched $60 a barrel Wednesday for the first time in four months and then there's this jaw dropper:

Exxon Mobil Corp. plans to reduce the cost of pumping oil in the Permian to about $15 a barrel, a level only seen in the giant oil fields of the Middle East. The scale of Exxon’s drilling means that it can spread its costs over such a big operation that the basin in Eastern New Mexico and West Texas will become competitive with almost anywhere in the world, Staale Gjervik, president of XTO Energy, the supermajor’s shale division, said in an interview.

15 bucks a barrel?? I mean, we're getting that thing down to the cost of a decent enchilada plate.

And then there's this: The Feds look as though they are going to pump more money into the nuke programs here: The Trump federal budget proposal provides for an ample increase for modernizing nuclear weapons and that means a budget increase for Los Alamos National Labs, with the money stimulating the northern economy. How much of an increase specific to New Mexico has not yet been stated.

We'll stop with the glad tidings while we're ahead.

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(c)NM POLITICS WITH JOE MONAHAN 2019

Wednesday, March 20, 2019

Veteran GOP House Member Says "Thank God" For Conservative Senate Dems, Plus: About That Tax Increase For High Earners 

Here is something you don't see every day--a state House Republican openly praising certain state Senate Democrats:

Thank God for Senate Democrats,” said Rep. Jane Powdrell-Culbert, R-Corrales. “Some of these (House ) freshmen really thought Senate Democrats would think their ideas were the best inventions since ice cream. Doesn’t work like that.”

Powdrell-Culbert, 69, has served in the House for 16 years, and while she was ready and willing to give the House freshmen a piece of her mind, she's probably also keeping a close eye on her Sandoval County legislative district. In 2018, a Democratic opponent scored 45 percent of the vote against her. The district is still GOP country but in the presidential  election year of 2020 the Dems could make her work for it as the higher turnout will lift them up some. That would keep Powdrell-Culbert on her toes.

Still, the feisty liberal freshmen are learning their lessons the hard way and with Powdrell-Culbert around class is definitely in session.

FAKE NEWS OR NO NEWS?

Was it "fake news or "no news yet" on the legislature's increase in the personal income tax for single filers making over $210,000 and for married couples filing jointly making over $315,000?

In our Monday blog we opted for "fake news" because the tax increase is tied to a precondition--it takes effect only if state revenues in the fiscal year that begins July 1 do not grow more than five percent over the current budget.

Several readers argued that that is not exactly fake news if you believe the Lujan Grisham administration's budget estimates for the 2020 fiscal year. Fair enough. For now we'll call the measure "no news yet."

The budget officials project that while this year's general fund revenue will come in at $7.59 billion, the next budget year will see that shrink to $7.43 billion, forcing the tax hike to take effect.

However, what if they are wrong? If revenue hits just a bit over $7.969 million--an increase of over five percent--the tax would die. And the way this oil boom has been generating cash, we would not count that out. If oil, currently priced in the high 50's a barrel, went up 15 bucks and stayed there, we could easily hit the mark, and we may do that without any price increase, given the historic and stunning volumes being produced in the SE Permian Basin.

The Santa Fe bean counters nave been notoriously unreliable in recent years. During the recession they predicted state revenue shortfalls that were not nearly as worse as those that occurred and during the oil boom they have underestimated the cash flow to state coffers.

As for the new tax rate, it would be a mild increase on the wealthiest taxpayers, giving them a a rate of 5.9 percent, up from today's 4.9 percent.

ABQ Dem State Rep. Javier Martinez, vice-chair of the House Taxation and Revenue Committee, agreed with our assessment that the possible tax increase measure does not restore a progressive tax structure. He wants an interim committee to come up with such a plan that addresses all the tax brackets. He also might want to look at creating a new bracket--for taxpayers making over $400,000 or $500,000. Should they pay the same as the "little guy" making the $210,000?

One correction: In our Monday blog we said if the tax rate were to take effect, it would start on January 1, 2022. Actually it would begin January 1, 2021. And a tip of the hat to the ABQ Journal capitol bureau chief Dan Boyd for supplying additional information for this report.

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Tuesday, March 19, 2019

Time For Another Edition Of Reader Vox Populi: Readers Write Of The Legislative Session, Dr. No, Tech Jobs, Balloons And Coloring New Mexico  

Time for another highly anticipated edition of Reader Vox Populi. ABQ attorney Bob McNeill gives us a kick start:

Joe, Good work covering the legislative session. NM is a backwater state in ways that keep us from progressing. MLG represents progress, but we have a mix of religious and rural values that make NM unique and aren’t going to change anytime soon, if ever. 

Sen. John Arthur Smith (chairman of the Senate Finance Committee) happens to have seniority and lives in Deming. Deming isn’t representative of much of NM, and John Arthur represents Deming and it’s values. But he won’t be in the Senate forever. We are in for a long, slow process of getting this state moving.

Educating our kids at an early age is an essential part of the effort. Poverty remains New Mexico’s primary barrier to getting out of last place in child well-being.

Reader Richard Flores writes of the most recent case of a child dying in the custody of foster parents and how that impacts the Children Youth and Families Department (CYFD):

CYFD will, once again, come under intense scrutiny after a child died in foster care. We don't know what happened so the public, media and politicians need to withhold blame until medical findings are made public. In any case, CYFD  faces another disconcerting and monumental PR fiasco. 

I believe the current governor is fully committed to serving the "best interests" of New Mexico's children, and it is unfortunate for this to happen so early in her term. Perhaps the task force to be appointed by the governor to reform child protection can come up with a reform package that will address the needs of our children and families for the better.

DOUBTING DR. NO

Reader Jeff Nordley writes of the decision of State Senate Finance Committee Chairman John Arthur Smith to not give a hearing on the bill to legalize recreational marijuana:

Joe, About your coverage of the marijuana legalization bill sponsored by Rep. Javier Martinez. Theoretically, in a democracy the majority prevails. Well, according to the ABQ Journal a majority of citizens in every county in NM support legalization. But, thanks to one Senator in Deming Democracy is subverted. That's not democracy, that's ridiculous.

An anonymous reader writes of their frustration with Senator Smith and other conservative Democrats, who along with Senate Republicans often form a conservative coalition to thwart legislation:

We Democrats need a robust primary in 2020 to rid the party of DINO's (Democrats in name only).  I plan to donate heavily to anyone challenging Sen. Clemente Sanchez of Grants or Senator Smith.

TECH AND BALLOONS

Reader Barry Simon writes:

Joe, I read an article recently about how tech entrepreneurs are looking elsewhere to start their companies rather than in unaffordable San Francisco. They mention Austin and Seattle. Then comes the kicker: "...even New Mexico." I guess our state is now one large city. But at least our burgeoning reputation as a tech center is being noticed.

Reader Steve Wentworth is president of the neighborhood association near the ABQ Balloon Fiesta Park. He writes of Mayor Keller's $7.5 million proposal to extend a railroad spur into the park to expedite traffic flow:

The Rail Runner spur line extending to Balloon Fiesta Park was considered a decade ago and died from a lack of support. Neighborhood leaders have been told the proposed spur line and a $2.5 million dollar slip ramp onto I-25 would only be used for Balloon Fiesta and maybe Freedom Fourth--less than two weeks of annual use. The majority of Park users drive to the Park and would not use the Rail Runner. 

Other improvements should be made to address the needs of people who use the park year round, including sewers, drainage, restroom facilities and utilities. The money for the proposed spur line and slip ramp could pay for additional city buses and improve  mass transit system for the metro. It doesn’t make any sense to target such an extraordinary expensive item while ignoring real year-round needs.

Good arguments, Steve, but the Mayor's seem a tad stronger, given the world class status of the event, even if the spur is used mainly for those two weeks. Those are the two weeks when millions of dollars come into the community from across the globe.

GOOD BEHAVIOR

Reader David Ley writes:

Joe, Senate Bill 41, introduced by Senator Mary Kay Papen, is intended to ensure that the events of 2013, and the state’s unilateral and destructive actions regarding behavioral health cannot recur.  The bill passed the legislature twice previously but was vetoed both times by Gov. Martinez. The bill again cleared the legislature this session, with bipartisan support and is on the  Governor’s desk. We expect her to sign this bill.  

A documentary on the events of 2013 and its long lasting ripples is showing at the ABQ National Hispanic Cultural Center April 6 at 3 pm. Your readers are invited to attend. Behavioral health providers and Human Services Department Secretary David Scrace will attend.

A reader writes of Bernalillo County Clerk Linda Stover winning a national award for her election worker training programs and provides this link.

CALLING PETER WIRTH

Reader Ken Tabish writes of the legislative session:

Joe, Many kudos to you for bringing the backroom and front room maneuvers during the most recent legislative session. It is refreshing to see progress after eight years of, as you say, “nothingness.” You just gotta have a love to hate relationship with Dr. No (Senator Smith) as he was at it again with fellow Dem Senators Clemente Sanchez and May Kay Papen. 

There will be great efforts by the progressive wing to find candidates to go against them in the primary. My question from the sidelines is where was Senate Majority Leader Peter Wirth? If he was wielding influence behind the scenes, it surely didn’t have an impact on these three. House Speaker Brian Egolf surely outperformed him in leading the House in pushing forth a progressive agenda.

COLOR MY WORLD

ABQ Reader Chris writes regarding our suggestion that because NM is not clearly a blue or purple state on the issues that we color it turquoise:

Re your color suggestion for NM politics:

"And there you have a New Mexican shade of Blue. Or maybe we should have our own distinct color given our state's unusual split on economic and social matters. How about a special color of turquoise?"

I cherish our state mineral, turquoise, and its color is one of my favorites, but as a descriptive color for politics it seems inappropriate. The oft-used "purple" is not appropriate because it is a combination of equal parts of red and blue, which is not an accurate description of our politics. Since NM is more blue than red, how about the color violet, which falls between purple and blue on the color spectrum?

Or is it too frilly a color to describe the rough and tumble of La Politica?

If we really want to show the true colors of La Politica, Chris, we might have to go to black and blue.

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Monday, March 18, 2019

Session 2019: New Mexico Plays Catch Up: After A Lost Decade New Leadership Took Field And Came To Play; Our Recap Of The Top Plays And Key Players  

Euphoric Democrats called the 60 day legislative session that ended over the weekend "transformative" "historic" and "monumental." We would opt for less hyperbole and call it "very important."

A solid foundation was laid for what could indeed become transformative change in the years ahead but a foundation is not a home. So before too much celebratory champagne spills on to the floors of the Roundhouse, let's take a deeper dive.

--The big picture headline for the session is "New Mexico Starts To Catch Up."

--The minimum wage--outside of the three large cities--had not been raised for a decade, woefully languishing at $7.50 an hour. Now it will go to $9 an hour in 2020 and eventually to $12 in 2023. The increase to $9 is 20 percent over ten years ago. Catch up.

--The state's general fund budget first reached $6 billion in 2007-08. Flash forward to this year when it hit $7 billion for the first time. That's a rise of 17 percent over 12 years, or less than 1.5 percent annually. Catch-up.

--Back in '07 the public education budget rang in at $2.560 billion. This year it comes in at $3.2 billion. That represents increase of 25 percent over twelve years and basically tracks the rate of inflation. Catch up.

--State employees are getting a pay raise of 4 percent. They have had no pay raises or mostly tiny one percent increases the past ten years. That's catch up. Ditto for public schools teachers who this year received a pay boost of 6 percent.

--The state's financial foundation had been so chipped away at by the recession and eight years of budget austerity that promised a better economy but failed to deliver that even the GOP this year did not fight the education budget which is 16 percent more than last year's.

NEW MOOD

It was an optimistic and productive session but let's put it in the context of the deep financial black hole we fell into this last decade. The result included several years of historic depopulation, a crime epidemic, a drug epidemic; a wave of child abuse, a loss of manufacturing jobs and a transition to a low-wage economy. This constructive legislative session began a long awaited restoration--not yet a transformation.

There was significant legislation passed but from where we sit one of the more consequential changes was in the psychology. The Governor, House, Senate and members of both parties embraced, for the most part, the new order that features mammoth surpluses and the release of pent up frustration. After 8 years of do nothingism they went to work and a can-do spirit returned to the Capitol fueled by the Permian Basin energy boom that promises to fill state coffers for years.

THE PLAYERS

The Governor led ably, if at one moment wobbly. She overreacted to the blistering reaction she received from rural county sheriffs over her proposed gun laws (which passed). And those who wanted to see her move the conservative state Senate Dems more to the center were a tad disappointed.

But those proved minor detours on the way to a win. She helped craft a suitable compromise on the minimum wage, kept the controversial but precedent-setting Energy Transition Act on an even keel; failed on the constitutional amendment for early childhood but did so in a way that cues it up for another attempt; stayed the course on two gun control laws (despite the hectoring); presided over ground breaking legislation for at risk students; a needed increase in the public schools budget and warmed up the previously frosty gubernatorial relationship with legislators.

The Alligators said she banged heads behind closed doors, but that's what a Governor does. There was merit to her post session Fourth Floor celebration.

House Speaker Brian Egolf grew into the job more this year and right on schedule the Republicans grumbled that they were being shut out. Well, that's what happens when you are shut out at the polls.

He had an embarrassing moment when he misspoke on a campaign finance reform bill but otherwise ran a tight ship. The addition of so many new progressive faces made it easier. Gone were Reps. Rodella and Trujillo who had made his life difficult. Much of the nonsense of past sessions--useless memorials and pontificating over red or green chile and the like--were mostly gone. The House was more productive than it has been in years. The Senate conservatives were like a batter facing ten pitches at once as they swatted away at Egolf and company's often unwanted presents.

Sen. Smith
In the Senate it was still all Dr. No all the time. Senator John Arthur Smith, chairman of the Senate Finance Committee, clung to his perch as the top Senate dog, but the pressure on him is now palpable. The new Governor joined the House in applying some.

The state's growing blue patches portend a coming to Jesus moment for the conservative Senate coalition that Smith has long presided over.

That may come at the June 2020 primary election when progressives hope to challenge some of the conservative Dems. They will also work to take out a couple of ABQ area GOP senators in the general election that would finally bust the coalition.

If the coalition does go, as we suspect it may, it would be the moderate Governor who would be the final check on any swing too far left. For now, the coalition stands but not as tall.

ALSO OF NOTE

That abortion bill that would have removed an antiquated statute from the books went down to defeat in the Senate, but it could spark campaign funding from national abortion rights groups who could seek revenge in the 2020 senate primary races. . .

Senator Peter Wirth's constitutional amendment to stop electing and have the Governor appoint members of the Public Regulation Commission (PRC) made it through and will be on the November 2020 ballot, That could be a close one. . .

Legalization of marijuana failed but a bill to decriminalize possession of up to half an ounce made it to the Governor. That seemed like a pitch-perfect compromise at this moment in history. Of course, the push for legal pot will be back next year. . .

Senate coalition watchers have their eyes peeled on Senate President Pro Tem Mary Kay Papen of Las Cruces. She turns 87 tomorrow and her election plans for 2020 have not yet been announced. If she opts out, the seat would could go to a Dem progressive, delivering a blow to the coalition. Watching her close things out at the end of the session did not leave the impression that she was packing it in. We'll see. Happy Birthday, Mary Kay.

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(c)NM POLITICS WITH JOE MONAHAN 2019

Friday, March 15, 2019

New Mexico Is Blue But Not California Blue; Progressive Social Issues Agenda Gets Crushed In Santa Fe While Economic Platform Fares Better 

We all know New Mexico is going Blue, but it's not California Blue. It's our Land Of Enchantment's own special shade and it's being painted right in front of us in the final hours of the 2019 Legislative session. Let's take a look. . .

Somewhat breathtakingly, given the Democratic landslide in last year's election, nearly the entire social issues agenda of the progressives and MLG collapsed in Santa Fe while more liberal economic measures have fared better.

The right to die bill died in the House when its sponsor pulled it because it lacked the votes for House passage. Last night the abortion bill that would have repealed an antiquated state law that makes abortion a crime, except in cases of rape, went down in flames on a 24-18 vote in the Senate after easily passing the House.

And it wasn't just those conservative Dems voting no on the abortion measure and who often form a coalition with the R's to thwart the progressive agenda. This time it included Northern Dem Hispanic Catholic Senators Carlos Cisneros, Pete Campos and Richard Martinez. They were joined by new Hispanic Catholic Dem Senator Gabe Ramos of Silver City.

Then there was the progressives' bill to legalize marijuana which made it through the House but got stiff armed in the Senate and is dead for this year. Again, Hispanic senators more friendly to economic populism were not ready to go there.

The only major progressive social issue that managed to a win was the bill mandating background checks for just about every type of gun sale in the state, But calling it "progressive" might be a stretch. Polls show the checks are overwhelmingly supported by D's and R's.

But it was like another state when it came to many of the banner economic issues of the session:

--Enviros and MLG scored a major victory with the Energy Transition Act (ETA) to increase the amount of renewables used to generate electricity.

--Progressives savored a nearly $450 million increase in the public schools budget; teacher pay raises of six percent and state employee pay hikes of 4 percent.

--They delighted in the $700 million overall increase in the state general fund budget, taking it to $7 billion for the first time ever.

--And late Thursday evening, after nearly a decade of no increases in the state's $7.50 an hour minimum wage, there will finally be a healthy hike progressives could somewhat celebrate. A House-Senate conference committee compromise agreed to raise the state minimum to $12 by 2023. The first increase starts January 1, 2020 at $9 an hour and goes up every year until 2023. The compromise does not include indexing the wage to inflation and it maintains the tipped wage for restaurant servers. 

The restoration of the progressive tax structure--raising the income tax on the wealthiest taxpayers so it would cease being the same as the lower brackets--was one important progressive economic issue getting beaten back (another was the constitutional amendment to tap the state's Land Grant Permanent School Fund for early childhood education.)

But how much to tax the well-to-do could be the opening progressives need to help take out the likes of conservative flat tax supporter Dem Senator Clemente Sanchez in 2020. House Speaker Egolf seemed to sense it when he proposed a late compromise that would have the highest tax rate kick in on incomes of $250,000 instead of $200,000. That higher amount will probably still lose, but it  could be an effective campaign issue for a Clemente primary foe.

WHAT IT MEANS

The state's economic direction has changed dramatically because of the long Great Recession which cratered much of the economy and cost so many good jobs. The economic drift is to the left. But social liberalism, while thriving in many of the state's cities, is still taking a back seat to the long New Mexican tradition of social conservatism.

What does that mean politically? Well, for progressives aching to run primary challengers against conservative rural Dem Senators, it means challengers will want to stick with the bread and butter issues and bend a bit toward the conservatives socially.

For Governor Lujan Grisham, who was especially stung by defeat of the abortion bill (she noted her discontent on Twitter) it means her path to success in turning around the state's education system and its economic malaise is wide open. But if she presses too much on the hot button issues that went down to defeat at the hands of her own party's social conservatives she will get intense push back.

And there you have a New Mexican shade of Blue. Or maybe we should have our own distinct color given our state's unusual split on economic and social matters. How about a special color of turquoise? Like this:

Located in Los Cerrillos, New Mexico, the Little Chalchihuitl mine is one of the oldest mining spots in the U.S. The turquoise found here is a stunning light green-blue color with gray or brown streaks, making the stone incredibly interesting to look at.

Yep. That's a good color for our politics and like that turquoise, they have been incredibly interesting to look at.

THE BOTTOM LINES

In our first draft Thursday about the bill (SB323) decriminalizing possession of small amounts of marijuana we said the legislation would make possession of half an ounce or less of marijuana a "pretty misdemeanor." We took that from the bill's Fiscal Impact Report but we read it wrong. It would be a petty misdemeanor if you were arrested with more than half an ounce. For half an ounce or less the bill would make the possession a civil matter, not a criminal matter, and it would be punishable by a small fine.

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(c)NM POLITICS WITH JOE MONAHAN 2019

Thursday, March 14, 2019

Just Hours To Go: A Lobbyist's Lament, One Pot Bill Still Lives, GOP Senator Seeks Cover On Minimum Wage And Can Norway Show NM Something?  

Pity the Santa Fe lobbyists. In these final hours of Session '19 when the action shifts out of the committees and onto the floors of the House and Senate they have to contend with some new restrictions on access that are prominently posted outside the respective chambers. One of the smooth talking, Gucci-wearing wall-leaners says he and his brethren don't like what they see:

Joe, both the House and Senate have had these signs up for a couple of weeks whenever they are on the floor. Lobbyists are no longer allowed to catch legislators on the floor like we use to before they are gaveled to order. This is what made New Mexico special and our legislators accessible. 

Well, it’s a tough sell. Feeling sorry for a lobbyist in Santa Fe is like feeling sympathy for the guy who just ran over your dog. But don't take it personal, lobbying corp. You notice how Senators this week quietly killed that bill that would have prohibited you from buying them any food or drink during the legislative sessions? They still like you--a lot.

Just two full days to go in Session '19 before Saturday's noon adjournment. Here's what's catching our attention. . .

Legal pot is dead but decriminalizing the possession of a small amount of the weed (up to half an ounce) is still on the table. ABQ Dem Sen, Jerry Ortiz y Pino reports;

Senator Cervantes' SB323 has passed the Senate and has only one House committee referral, to Judiciary, before it reaches the floor there and is sent to the Governor. It is an improvement over what we do now, but not as broad a reform as we need if we are to have any hope of actually controlling drug use. Criminalizing it clearly hasn't worked, but decriminalizing it only does half the job: it leaves the illegal market controlled by gangs, cartels and dealers, unimpeded, free to squeeze millions in profit from New Mexicans. 

House Judiciary has the bill on today’s calendar. The state reports that the bill would reduce the number of criminal cases in the courts. In 2018, there were 2,165 cases of people charged with possessing an ounce or less of marijuana. The Cervantes bill would make it a civil not a criminal offense for possession of up to half an ounce, punishable by a small fine. That would mean a lot of low income folks would avoid spending time in jail for smoking a joint.

As for the cartels, legalizing marijuana elsewhere isn't having much of an impact on them. A report here.

HEARING FOOTSTEPS

Sen. Rue
At least one ABQ metro state senator is hearing footsteps behind him on the 2020 campaign trail and taking action. Republican Sander Rue was the only R to vote in favor of a minimum wage increase bill that passed the Senate last week on a 26-15 vote. He represents ABQ's westside which is heavy with middle income families and growing more Democratic.

Rue is one of three GOP metro Senators we've pinpointed as vulnerable to defeat at the hands of the Dems next year as BernCo grows increasingly blue. The others are the North Valley's Candace Gould, who has already drawn a Dem opponent, and GOP Sen. Mark Moores in NE ABQ.

As for the minimum wage, it's tied up in knots as conservative Dem Senator Clemente Sanchez could not reach a compromise with the House which wants a higher boost (as does the Guv) than provided for in the Senate passed bill.

The big cities already have their own minimums but outside of them the hourly wage is only $7.50 an hour and hasn't been raised in years. That's a lot of chile picking for a few dollars. There’s plenty of time for a compromise and a lot of low-wage workers are counting on one.

LOOK OUT OCATE

There's been nearly unanimous support for the proposal to apply the gross receipts tax to all Internet sales in the state. On-line giant Amazon already applies the tax but the House-passed tax bill applies it to all Internet sales. There is a minority view and Reader David Geary has it:

Joe, you endorsed the Internet sales tax as it would “level the playing field” between online and local “brick and mortar” retailers. This view might work for metropolitan areas, like Santa Fe, Albuquerque and Las Cruces, but many New Mexicans are very rural, are on low or fixed incomes, and 40% of them are on Medicaid — indicative of their precarious livelihood.

Take poor car-dependent families who live in Claunch or Ocate. They must drive as long as a 2-hour round trip for even mediocre shopping. Being able to order online, and have needed items delivered to them, is a real benefit. And what would the new tax be for them? The statewide sales tax rate, or that rate plus the added local sales tax to around 8%? Ouch!

Fair points, David. To answer your question, the legislation would first apply the statewide gross receipts tax of 5.125% to on line sales but after two years the local GRT tax would also be applied.

LOOK TO NORWAY

About the immense gobs of money being generated in the NM oil boom and how to best use the surpluses to move the needle in a positive direction, reader Douglas Carver writes:

Joe, You've done a great job chronicling the changing financial fortunes in the state, thanks to the oil boom in the Permian Basin. When our bean counters look for models of what to do with this new-found and (for a change) possibly long-term wealth, we should look to Norway. Two good pieces demonstrating why are here and here.

You want a dream for New Mexico? Becoming the Scandinavia of the United States.

Those are good reads on how Norway, which generates $40 billion a year in oil revenue, has changed their social and economic landscape with the funds. We recommend them to our NM solons.

Just one other thing, Douglas. Can we get the Scandinavian thing but keep our own weather?

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Wednesday, March 13, 2019

A Whole Lot Of Shakin' Going On In Santa Fe: We Cover The Major Action, Plus: New And Incredible Oil Boom Numbers Rock The Roundhouse; Another Cornucopia Of Cash Coming Soon 

It may not be earth shattering but the 2019 legislative session is shaping up as one of the most consequential in years. And, unlike the past eight legislative sessions under the previous Governor, these final days are busy--really busy. Let's try to fit it all in, starting with our takeaways:

--The hefty hike in the public education budget is a done deal. The Senate Finance Committee has approved an increase of nearly $450 million million (16 percent). That puts the state on track to restore funding stripped away in the Great Recession and to begin satisfying a court order that found the state violating the Constitution when it comes to educating the many at risk students in the state. Supportive legislative Republicans and their leader Sen. Stuart Ingle get a special tip of the hat for realizing the necessity of this boost. 

--The ETA is A-OK, according to the Legislature and Governor. It passed the House Tuesday and is on MLG's desk for her signature. The Energy Transition Act establishes a goal of having the state's energy sector going to 50 percent renewables by 2030 and 80% renewables by 2040. That's big. The bill, however, also provides what critics call a 'bail out" of PNM for the cost of closing down its coal-fired generating facilities. That's also big and could lead to a court challenge.

--If the legislature passed only those two bills, they alone would make for a significant session, especially compared to the do-nothing gatherings of the recent past. But there's much more.

--The state budget has yet to go to the Governor but it will soon and total about $7 billion. That's a $700 million increase over last year. But hold on. There's another cash cow that is flying under the radar.

—Bam! Senate Finance approved a capital outlay bill this week with one time money coming from the booming oil fields that will total nearly a billion dollars. Whew. It's actually $933 million for the "pork" projects for individual legislators and the Governor, such as new buildings, parks and the like. If the Legislature can do a better job of rolling out all that dough, you are talking some serious economic stimulus.

As fiscal hawk and Senate Finance Chair John Arthur Smith grumbled this week:

Politicians who like spending money really enjoyed this session.

--It is really incredible to see these new numbers come rolling in from the Permian and to try to internalize what they could mean for this largely impoverished and under educated state. It's just awesome:

(NM oil output) hit all-time record of nearly 246 million barrels in 2018, according to the latest statistics from the state Oil Conservation Division. That’s up 42 percent over 2017, when New Mexico produced nearly 173 million barrels, also a record high at that time.

If this keeps up we're taking John Arthur to the gambling tables in Vegas for a weekend.

NO BUST IN SIGHT

We've blogged a number of times that the surprise for lawmakers could be how long this oil boom continues and keeps a flood of cash coming in for a long period--not the old boom-bust scenario. Chairman Smith seems to be catching on:

That preliminary forecast on surplus money for FY 2020, released late last year, may now be too low, said Sen. John Arthur Smith. . . “It appears we’ll generate more than what was forecast in December, even over $1.2 billion,” Smith said. “And for next year’s budget, we’ll likely see a steady revenue stream from oil and gas. I think production will hit 300 million barrels by the end of this year.”

Folks, it's Ground Control to Major Tom time: All Fiscal Hawks please land immediately. You've been grounded for the foreseeable future.

But Dem State Senator John Sapien of Corrales is still flapping those wings:

We’re like a homeless person who wins the lottery. We’re going to spend it all, and in two to three years we’re going to be broke again.

What? Are homeless people winning lotteries in NM? Anyway. . .

John, they are not spending it all. The budget reserve for the coming budget year is an unprecedented 20 percent and then there's that new rainy day fund (that we find excessive) that will see even more millions set aside. And then there's the tax increase bill to provide a back-up revenue stream in the event of an oil crash. Not all of it will survive the final legislative hours but a conservative estimate is that well over $100 million in new annual tax revenue will go on the books. (Unfortunately, it appears the restoration of the progressive tax system may not stand up to  conservative scrutiny). Still...

We don't say it too often, but dammit, that is pretty good legislating. Now the job is to come up with a multi-year plan for the surpluses to come.

The Governor and the Legislature have been presented with one of the greatest opportunities  in state history.

It's time to stop fearing the future and embrace its possibilities.

SAY IT AGAIN

Ryan Flynn of the NM Oil and Gas Association has said it before and he says it again. Reacting to the historic oil gusher numbers of 2018, he declared:

This shows that even if prices remain relatively stable, the state can still expect $1 billion-plus surpluses to continue into the future.

Hey, fiscal hawks. That's an oil and gas guy saying it, not Alexandria Ocasio-Cortez. Sure, make certain the spending train doesn't go off the tracks, but at least grab a seat.

Here is more persuasive evidence for the Guv and legislators that time is running short and they need to intensively prepare and plan for this cornucopia to come:

Royal Dutch Shell is on the hunt for deals to bulk up its position in the Permian Basin, where it lags rivals Exxon Mobil and Chevron. “We are definitely actively looking at opportunities,” Wael Sawan, Shell’s deepwater boss, said. “If none ever come up then that’s a disappointing outcome.”

That's not some small independent operator. These are the major multinational corporations of the world.

Like a broken record (remember those?) we'll say it again:

This Governor and Legislature have been presented with one of the greatest opportunities in state history. 

P.S. Please don't blow it.

TOO GENEROUS?

About our Tuesday blog saying the the current five member Public Regulation Commission (PRC) has its act together compared to previous panels and that keeping the commissioners as elected officials--not appointed ones--makes sense, a Senior Alligator writes:

You’re being awfully generous with the PRC. Just because none of the Commissioners is currently under investigation or caught with their hands in the cookie jar doesn’t mean they are a model of accomplishment. What exactly Commissisoners Cynthia Hall and Valerie Espinoza have accomplished is unclear to me. Have they fixed the state’s broadband problems yet or held Century Link accountable for their lack of investment in rural areas? How about extending natural gas northward beyond Espanola or pushing electric providers on renewables? What about putting some needed pressure on insurance providers?

A new, appointed group of commissioners might just be ethical, qualified and effective. That’s a true formula for success and a rarity at the PRC as we know it.

Several other readers said while there may indeed be a new "progressive majority" on the commission it is "inconsistent," with Dem Commissioners Hall and Espinoza often breaking in different directions.

LEGAL POT DIES


ICYMI--The legal pot movement has died suddenly but not unexpectedly in Santa Fe. With one sentence Senate Finance Chair Smith blew smoke in the eyes of the legalization supporters. He simply said:

It’s not a priority.

Everyone and their brother saw it coming, even after the pro-pot crowd was heartened by House passage of a bizarre bill that would have put the state in charge of selling the stuff.

What's sad is the missed opportunity. In their zealotry to get legalization its backers ignored pleas to support a decriminalization bill. That bill would have prevented the jailing of mostly low income people for possession of small amounts of the weed--the very people the well-financed national marijuana lobby in Santa Fe says it wants to help. . . Maybe they can put up the bail money for those jailed in the next year?

There you have it, Gators. That's a whole lot of action. Don't worry. Being a political junkie is still legal in New Mexico. But be forewarned: it can be both a blessing and a curse.

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Tuesday, March 12, 2019

PRC Shake-Up Eyed Even As It Finally Settles Down And Steps Up, Plus: Pay Raises For Top Elected Officials On The Move, And: Sainthood For Dr. No? 

Cynthia Hall
Valerie Espinoza
After a couple of decades when the Public Regulation Commission (PRC) has often looked like a clown show, so riddled with ethics and personal lapses that you fully understand why there is a measure being considered to eliminate the five member panel and replace it with a three member PRC appointed by the Governor. But there's a problem--the clown show has closed.

The current five PRC members have done nothing of late to embarrass themselves or the state. More important, many Dems are pleased with the working liberal majority that has emerged on the panel (perhaps the first one in the PRC's 20 year history). This PRC has been more aggressive with PNM--the electric utility it is charged with regulating--along with many other companies including insurance and transportation.

For now, it's hard to see how the Governor could appoint a stronger panel than today's. Take a look:

--ABQ attorney Cynthia Hall is a star in her field and already had a lengthy background at the PRC, serving as assistant general counsel, before winning election. Hall sports an eye-popping resume that includes expertise in environmental and regulatory law--essential to the PRC's responsibilities.

--Former Las Cruces area Dem State Senator Stephen Fischmann overcame paid political opposition from PNM in last year's election to win his seat. He is known for his studious demeanor and expertise in regulatory affairs. This quote says it all: "My goal is to transform the PRC from an agency that’s guided by utility interests to an agency that guides utilities in the public interest."

--Valerie Espinoza, the former Santa Fe County Clerk, is also a Democrat and gives the PRC a progressive majority that has turned around the image of the commission. She currently chairs the PRC and is known in the North for her crafty political ability, an essential quality to bridge the gap between the utilities and end users.

--Teresa Becenti Aguilar adds to the Dem majority--but not necessarily to the progressive majority. Her northwest district is plentiful in natural resources. She brings a Native American perspective to the commission and lengthy experience at the federal level, including the Congress and BLM.

--Republican Jefferson Byrd is a rancher and environmental engineer who gives voice to the conservative view on PRC matters. He grew up in Mosquero and brings to the commission a deep understanding of rural NM.

So finally, after two decades filled with antics that made voters want to pull their hair out, the PRC seems to have found its footing. That makes the proposed constitutional amendment that would ask voters to let the Governor appoint the PRC and add additional qualifications to serve seem a bit out of step. Internal staffing reforms of the complex agency seem to be more pressing, according to experts.

Senate Joint Resolution 1 passed the Senate and is now in the House but legislators might want to keep it there and pause before upending a PRC that at last seems equal to those it regulates--and tough enough to represent everyday people.

PAY HIKES COMING?

When the PRC launched, in 1999, the eyebrows were raised over the salaries for the commissioners. Coming in at $90,000 a year they were then among the highest paid public servants in the state, but time marches on as does inflation. The Senate on a 37-3 vote recently passed 15 percent pay raises for various elected officials, including the PRC. See what you think:

⦁ Governor: $110,000 to $126,500
⦁ Secretary of State: $85,000 to $97,500
⦁ State Auditor: $85,000 to $97,500
⦁ State Treasurer: $85,000 to $97,500
⦁ Attorney General: $95,000 to $109,250
⦁ Commissioner of Public Lands: $90,000 to $103,500
⦁ Public Regulation commission (PRC): $90,000 to $103,500

Those are still pretty modest wages for the authority the positions wield. We would look for the pay raises to be quietly pushed through the House in the final legislative days. We'll let you know.

NEW NAME FOR DR. NO?

Dr. No
Reader Ken Tabish has an insightful and funny take on the tabling by the Senate Rules Committee of the constitutional amendment to tap a portion of the nearly $18 billion Land Grant Permanent School Fund for early childhood (ages 0-5) education:

Joe, I had this feeling after reading your blog last Thursday that "Dr. No"--State Senator John Arthur Smith, chairman of the Senate Finance Committee, needs a name change. I believe he is due sainthood and should be given the title of Saint of Perpetual Poverty in NM. 

Yes, the early childhood amendment was killed in the Rules Committee but no one will convince me that conservative Democratic Senators Mary Kay Papen, Clemente Sanchez and Bill Tallman are not in Dr. No's hip pocket. It was a clear deflection to avoid a direct "no"  from Smith and his Senate Finance Committee. He is firmly against the amendment and always has been but this year he avoided a direct hit for that position which is unpopular with the public. 

It's apparent Smith has the power in the Senate. Where is Senate Majority Leader Peter Wirth through all this? Smith’s behind the scenes push to decrease the minimum wage increase and the change in the recommended tax rate increase for higher earners are measures that impact mostly poor citizens of this state! Thus, Dr. No is now the Saint of Perpetual Poverty!

Sainthood for Dr. No, Ken? Somebody call J.D. Bullington. Looks like we need a lobbyist at the Vatican!

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Monday, March 11, 2019

NM Pot Watch: House Approves Legal Weed; What's the Rush? Feds May Do It Soon Enough, Plus: This Session's Feel Good Bill 

Welcome back. Let's catch up.

It was a historic vote when the state House approved legalization of recreational marijuana Thursday night on a narrow 36-34 vote and sent it to the Senate. But there's still plenty of skepticism that state government is equipped to get into the marijuana distribution business, as the bill mandates. They cite state agencies like the Children Youth and Families Department (CYFD) and MVD that struggle to get their jobs right and wonder how state-run marijuana shops would fare in a state where bureaucracy so often goes awry. Why not wait? The federal legalization of marijuana appears, if not around the corner, at least happening in the foreseeable future:

A growing list of Democratic presidential contenders want the U.S. government to legalize marijuana, reflecting a nationwide shift as more Americans look favorably on cannabis. Making marijuana legal at the federal level is the “smart thing to do,” says California Sen. Kamala Harris, a former prosecutor whose home state is the nation’s largest legal pot shop. New Jersey Sen. Cory Booker, a prominent legalization advocate on Capitol Hill, says the war on drugs has been a “war on people.” 

The go slow pot crowd says having a federal regulatory umbrella for pot distribution--one with decades of experience dealing with alcohol and drugs--makes much more sense than leaving it to a state that has been hapless in trying to deal with an epidemic of drug abuse that, among other things, has precipitated a years-long ABQ crime wave.

Several anti-legalization lawmakers say one of the more misleading (and perhaps nonsensical) arguments heard in favor of legalization during the House debate was that it would somehow break up the international drug cartels. But the cartels have already beefed up their distribution of much more dangerous drugs like meth, heroin and fentanyl as more states legalize weed. Do we want to legalize those as well?

We were quizzical when NM GOP Chairman Steve Pearce decided to pen an anti-legalization op-ed recently, but with three GOP state Senators lobbying  R's on the Senate Finance Committee to get the bill through in the final days, maybe Pearce chose the right topic after all.

Simple decriminalization of marijuana, as proposed by State Senator Joe Cervantes, would address a chief concern that legalization advocates say they have--putting a halt to the arrest and jailing of low income people of color for possession of small amounts of cannabis.

But Joe's plan is ridiculed as old-fashioned, even as the national marijuana advocates dismiss the unique drug culture in NM that has been embedded for generations and has caused untold human suffering and loss of life.

It is indeed different here than in the more wealthy states that are taking the dive into legalized marijuana. Much different. The population here is much more vulnerable. Maybe the Senate Finance Committee will get that.

A final note on this from Albuquerque Dem liberal state Senator Jerry Ortiz y Pino who has long supported legalization but says this bill will not achieve the goal of preventing the arrest of people for possessing small amounts of pot: 

This bill creates a state-run store - which is fine, but not so fine is that you can still be arrested for growing or possession without a receipt on hand. In other words, barring a related decriminalization bill getting signed into law, New Mexico will continue to fill prisons with people arrested for a non-violent crime. 

I know this bill is a compromise, but I was hoping the whole point was to keep people from going to jail, especially people of color who are incarcerated at higher rates than Anglos, for an illegal act that should never have been made an illegal act.

Like we’ve said, Jerry. Do the Cervantes decriminalization bill this session, see how that works and then take it from there.

THE FEEL GOOD BILL

This is a well-intentioned measure. Several lawmakers and their supporters worked hard, but in the end it backfired because it takes the heat off. We explain. . .

Opponents of what they call "raiding" the nearly $18 billion Land Grant Permanent School Fund for very early childhood programs have a new skirt to hide behind. It's called the Early Childhood Education and Care Department approved by the Legislature and headed to the Governor's desk.

It was a very easy vote to take since its main task is to place under one roof administration of early childhood education programs that are scattered among various agencies. Tellingly, it does not increase funding for those programs, just leaves the impression that there is some kind of unspecified  mismanagement going on with the programs and that this bureaucratic shift will solve the imagined problems.

As we said, what an easy vote to take. It was approved 39-2 in the Senate, revealing the toothlessness of the feel good gesture. Such overwhelming "bipartisanship" is often Santa Fe's code word for a "nothing burger" and that description aptly fits this bill.

The issue is not fraud and/or bungling in early childhood programs (as some supporters of the new department outlandishly imply) it is access to them. As education expert and blog reader Stephen Spitz pointed out here last week:

The state's early childhood education programs remain minuscule. For example, the Home Visiting program, for children prenatal to 3, presently serves 3,500 kids out of total client population of 70,000. Numerous studies have found that home visiting gets the biggest bang for the buck, particularly for "at risk" children, such as the 82% of NM births which are Medicaid qualified. In short, ECE needs to be dramatically expanded if we hope to address the state's economic, education, and social crises.

Hmm. Nothing about that in all the hype over the early childhood department. What you get instead is a new and unnecessary cabinet secretary (#23!) along with some kind of ambiguous "streamlining" and "consolidation" of early childhood efforts.

It is an inexpensive deception that is useful for relieving the guilty conscience of lawmakers over their reticence to directly attack the ongoing societal wreckage in the state.

 What you get is a Secretary Feel Good, but what you don't get is the requisite cash to bring ECE to the tens of thousands of children who need it. That opportunity is being lost as the Senate again moves to kill the constitutional amendment to use a small portion of the Permanent Fund to finally fund programs that are true game changers. Instead we get the Nothing Burger.

Thanks, Santa Fe, but we'll take a pass. If you change your mind, meet us at Blake's and we'll be glad to talk about the real deal.

THE BOTTOM LINES

While the state dawdles, the Millenials depart. Now it's even easier for them to get out of here:

Options to and from the Albuquerque International Sunport are again on the rise, most recently with Southwest Airlines’ announcement of expanded service from Austin, Texas. The airline, which currently offers weekend-only options from Austin, is expanding to daily offerings beginning August 6.

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Friday, March 08, 2019

A Visit To The Media Beat: Calling All Tired Reporters; Guv Offers Hope, Plus: Popular TV News Anchor Marissa Maez Exits And Readers Have Questions  

Marisa Maez
Let's get over to the Media Beat this Friday and see what's brewing.

First off, reporters tired of the daily grind may have some hope for new careers now that there's a new Guv on the Fourth Floor who isn't shy about filling vacancies. Her communications director fired off a Tweet that no doubt garnered the attention of weary ink-stained wretches and tired TV types seeking a less stressful setting:

NM state government needs communications professionals! Still lots of departments! If you are interested or you know a talented writer/thinker who can work with the press and help facilitate transparent governance, DM (direct message) me!

When Big Bill took the helm in 2003 it seemed he took half the staff of the ABQ Journal with him into state PR jobs. For those who missed out then, it looks as though they have a second chance.

MARISSA MAEZ

Fans of popular KOAT-TV morning anchorwoman Marisa Maez, who was also a presence on evening broadcasts, are asking us: "What happened?"

She abruptly announced her departure from the anchor chair Wednesday and will leave KOAT today after 16 years on the dawn patrol. She said in her statement that she wanted to spend more time with her family, but Paul Roybal asks:

Joe, it seems unusual that Marisa Maez announces her resignation to "spend more time with her family" on Wednesday with her final work day Friday without the usual fanfare given other anchors when they depart after long years of service. Inquiring minds want to know, suelta la sopa!

Good question, Paul. You said "suelta la sopa!" which translates to "tell me what you know." So:

Media observers can only speculate about what happened to Marissa, 43, a native New Mexican who has been with the station since 1999. Those observers point out that a new general manager took over KOAT in November, replacing Mary Lynn Roper who had advanced Marisa's career.

They think if there is more to the story you should "follow the money." Maez, an ABQ Manzano High School grad with a journalism degree from UNM, likely built up a big salary with her long tenure. TV stations continue to operate under pressure and with an ever present scalpel poised to cut costs. New managers bring a fresh look at budgets. They often do that by forcing the ouster of highly paid talent, replacing it with new lower paid talent. For now, it's adios Marisa. (P.S. Will Marisa end up working in one of those many open state government PR vacancies? Stay tuned.)

SOCCER AND ETA

A couple of clarifications about the first draft of the Thursday blog.

First, the Energy Transition Act (ETA) passed by the Senate Wednesday night does not, as we said, now go the House "for concurrence." ABQ Dem Senator Mimi Stewart clarifies:

The Energy Transition Act has not yet passed the House, so instead of going to the House for concurrence, it’s now moving to the House for passage through committees and onto the House floor.

And in our report about UNM soccer we said the new UNM Regents conducted a meeting and that it appears reinstatement of the men's soccer program is not in the cards. We are now told that it was a meeting of a committee of Regents and that the next full UNM Regents meeting is scheduled for March 11th.

Keeping it on the men's soccer front, reader Gabe Gallegos offers this:

Joe, your piece about UNM soccer may not have all the context necessary. About a week ago, UNM went to the ABQ Journal with data that claims that UNM football actually turns a profit. This runs absolutely counter to UNM President Stokes' initial claims when she decided to cut soccer. A local attorney wrote a letter to the Regents imploring them to reinstate soccer while the actual data is calculated from UNM Athletics. It was in response to that letter that Regent Schwartz said that the decision to eliminate soccer should hold. But I don’t think we know if Rep. Lundstrom's measure to hold athletic funding up until UNM reinstates soccer will actually be killed. We will see.

Thanks, Gabe. Stokes and Rep. Lundstrom have been on a collision course all year. Did we count soccer out too early? The final act will soon tell the tale.

DATELINE TAOS

It is a great ski season in NM, not a common occurrence in recent years because of drought. Taos Ski Valley is one of the beneficiaries even as it struggles to overcome a tragic avalanche accident that killed two skiers. The NYT takes a look at the new and improved Taos.

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