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Wednesday, August 10, 2016

Bad Optics: State Budget Crisis Has Martinez Wielding Budget Axe And Then Jetting Off To Dallas For "Political Meetings"; Crisis Still Sticky And Looms Large Over Election 

Come on, Governor. Can't you at least pretend your heart is in your job? No sooner had Susana announced she was ordering state spending for executive agencies under her control slashed by five percent then she heads out-of-state for "political meetings" in Dallas in her role as chair of the Republican Governors Association.

And the Governor's statement about the cuts and their impact was deliberately ambiguous, not mentioning exactly how much would be saved or the impact on public and higher education, if any. KRQE-TV news reported the budget cuts do not include public or higher education. If they did her action would mean education funding cuts of nearly $180 million between now and the end of the budget year next June 30, according to a legislative staffer.

If she is not going to cut education and will not sign any tax increases, how is the massive budget shortfall to be solved? The five percent agencies cut isn't going to get it done. It sounds more like a political stunt than serious budget making.

The Governor is expected to call a special session of the legislature to at least plug the estimated $200 million hole left over from the budget year that ended June 30, but that still leaves. . .

The current budget year that started July 1 and which already faces a projected shortfall of up to $500 million (or more) in the $6.2 billion general fund because of the oil and gas price crash and a decade of too much tax cutting.  Even if Martinez's five percent cut included education, it would probably not be enough to close that large of a gap, warns Senate Finance Chair John Arthur Smith.

But this is an election year and Martinez and her Republicans are already taking hits over the lousy economy and the fiscal mismanagement in Santa Fe. Will they say the five percent cut is a miracle cure and no tax increases are needed whatsoever and let the mess unfold at the regular legislative session in January--after the November election where the R's majority in the state House hangs by a thread.

The kick the can down the road budgeting has plagued Santa Fe for several years. The political class simply refuses to plan for a long downturn in oil prices, praying to Zozobra or whomever that the price shoots back to $100 and they don't have to do their jobs.

Budget forecasts from the administration and the Legislative Finance Committee have been at best embarrassing and at worse disingenuous. Time after time they get it wrong and force repeated meat ax budget cuts that fail to state this state's priorities.

Yes, it feels different this time. It feels worse and it feels like it's going to last a long, long time. No wonder Martinez is in Dallas.

THE BUDGET BEAR

Elsewhere around the state the Budget Bear continues his romp. The city of Artesia in the SE NM oilfields has announced a ten percent across the board cut in the salaries of all city employees. And that includes the police. How often do you see that? Gross receipts tax collections in the city of 11,000 have crashed as a result of the depression in the area oil fields.

And here in the big city, gross receipts collections aren't setting any records. The city of ABQ has gotten caught with its pants down and now says tax collections for the recent budget year did not meet the 3 percent growth rate they optimistically predicted and is more like 2.2 percent. That's what the Budget Bear likes to hear.

This is the home of New Mexico politics.

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(c)NM POLITICS WITH JOE MONAHAN 2016
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