Thursday, February 04, 2016
On The Econ Beat: Santa Fe Cracks Some On Tax Cuts, Reader React On APS Election And Natural Gas Crash Still Here
throw in the towel on its ill-advised corporate income tax cut that's contributing to the treasury being starved:
(State Senator John Arthur Smith, chairman of the Senate Finance Committee) who three years ago sponsored a sweeping tax-cut package pushed by Gov. Martinez has introduced legislation to delay key parts of the package, including scheduled reductions in the state’s corporate income tax. (Smith) said that he introduced Senate Bill 252 as a “backup” in case the state’s revenue picture takes another turn for the worse.
With oil prices crashing, gross receipts tax revenue down year over year and the highest unemployment rate in the USA, New Mexico seems within a hair's breadth of plunging into another recession, if it's not already there.
ABQ might actually benefit from some of this as folks scurry to the larger cities to escape the economic dead end in rural areas. But it's no bed of roses around here. The Brookings Institution economists--who belong to our list of "No Bullshit Economists"--report that their Metro Monitor ranks the ABQ metro 99th out of 100 metro areas in the USA for economic growth from 2009 through 2014.
But don't fret. House Speaker Don Tripp and Majority Leader Gentry are going to give us a teen curfew and a "three strikes and you're out" law to deal with this. Geez, fellas, how can we thank you?
FLAT TO DOWN
ABQ voters sucked it up and approved that big APS bond and mill levy this week as well as a bond for CNM that will raise property taxes. In light of this news, voters deserve an extra round of applause:
In Albuquerque, home prices, including distressed sales, increased by 0.6 percent in December 2015 compared with December 2014. On a month-over-month basis, home prices, including distressed sales, decreased by 0.4 percent in December 2015 compared with November 2015.
Speaking of that APS election and our coverage, reader Ken Tabish writes:
Joe, As a retired APS employee and a voting community member of the APS Capital Master Plan Committee, I just wanted to says thanks for laying it out about the Albuquerque business organizations and their lack of support for APS/CNM Bond Election. It was spot on! A good education (and I know APS has work to do) is the bedrock of a strong economy and an opportunity builder for a middle class. This election was about students, educators and communities in which those schools reside. There is a great need in APS to renovate and restore old buildings, provide equity educational environments for all students, to comply with federally mandated requirements and to improve the technology, health, and security of our students.
And former ABQ City Councilor and onetime mayoral candidate Pete Dinelli also weighed in:
Joe: Once again you reported the tragic truth when you said "The absence of the city's major business groups in promoting the APS bond issues to improve the schools for kids was notable and depressing. The Albuquerque Chamber of Commerce, the Economic Forum and NAIOP were no where on this critical vote. It is as if they resent the city they purport to represent.:
You could have said the same of the Albuquerque Journal about the community it sells papers to. Now you have the Mayor of Albuquerque advocating that the legislature essentially lower Albuquerque's minimum wage, even after voters increased it with a 71% voter approval a few years ago. Mayor Berry is also advocating using the PERA pension fund to bail him out on solving APD's recruitment and retention of sworn police officers. It as if our own Mayor resents people struggling to make a living in the economy he has done absolutely nothing to turn around.
THE GAS CRASH
We hear much about the crash in oil prices and how that is hampering the state budget, but don't forget natural gas which is also a mighty contributor to state revenues and a key industry in the hard hit Four Corners. Gas is in an epic bear market that may have further to go:
Futures prices for natural gas could drop to levels not seen in more than two decades as resilient production levels, hefty U.S. inventories and weaker demand combine to pull prices down to $1.50 or lower.
The population of San Juan County has been shrinking since 2010. The economy in the Farmington area remains undiversified and its destiny hitched to the wild roller coaster ride of oil and natural gas prices.
THE BOTTOM LINES
From NM US Sen. Tom Udall:
Senator Udall invites New Mexico college students interested in gaining legislative or press relations experience to apply for summer internships in his Washington, D.C., office. To apply for an internship, please visit here. The upcoming summer internship session will last from May 31-July 15. Applications must be submitted by March 15.
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c)NM POLITICS WITH JOE MONAHAN 2016