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House Republican Leadership Comments on the 49^th Legislative Session

Santa Fe – Today in response to the conclusion of the 49^th New Mexico Legislative Session, the House Republican leaders offered the following statements.

“We spent more than $4.9 million for a 30-day session when our obligation was to pass a balanced budget.  The House passed a budget with a deficit of $310 million and had a budget returned from the Senate with a $100 million deficit.  The people of New Mexico were short changed with this session and will end up paying more than $50,000 a day for a special session,” said House Republican Leader Tom Taylor.

“Rather than agree to bad legislation just so we could go home, Republicans will continue to be a voice for sensible solutions: leaner government, lower taxes, fewer unnecessary regulations,” said House Republican Whip Keith Gardner. 

“Let’s remember that cuts are not the goal, revenue is the goal.  The only way we can increase our revenue is to make cuts, avoid raising taxes, and let the economy bloom again,” said House Republican Caucus Leader Anna Crook.

The following op-ed appeared today in the Albuquerque Journal under the heading, “Permanent Fixes Needed to Reconcile State Budget,” and is offered for submission to all media.

Budget Transcends Political Boundaries

Submitted by the 49^th New Mexico State Legislature House Republicans

With so much at stake and so little time left in the 49^th New Mexico Legislative Session, we would like to lift the curtain on how the budget process is unfolding.  The story this year has so far been a dramatic one as we and our Democrat colleagues clashed, debated, maneuvered, and finally come together in an effort to allow the budget to transcend political boundaries.

When this session began, New Mexico had a budget deficit for the upcoming fiscal year of $600 million.  The Legislative Finance Committee proposed a budget to the House Appropriations and Finance Committee that would reduce that deficit to $200 million.  Rather than taking that recommendation and working to scale it back even further, the House Appropriations and Finance Committee added $90 million to it, creating a total deficit of $310 million with most of the balance temporary dollars. 

The possibility of raiding our already depleted rainy day funds permeated budget discussions despite figures that proved they should be left alone to replenish.  Once a thriving 13% of recurring appropriations, the state reserves have been reduced to 2.5% of recurring appropriations, or about $133 million.

It was clear from the beginning that the chances of receiving large amounts of temporary additional federal money is slim.  The $23 million of federal money that is headed our way for education and the federal funding for the Medicaid program that will allow New Mexico to reduce general fund appropriations by $70 million are temporary.  We will have to replace them next year.

A few weeks ago, Rep. Ken Martinez extended a hollow invitation when he said, “Even if you [the House Republicans] will not vote for any type of revenue enhancement I think you can have a hand in the policy making by just giving us your good ideas.” 

In fact we had provided the powerful House Rules Committee that is controlled by Democrats ten of our “good ideas” in the form of bills that would institute responsible and necessary budget cuts that are not temporary.  All of these bills were voted down, eliminating any chance of debate, testimony from New Mexicans around the state, and other legislative action that is vital to making responsible budget decisions.

It appeared that Democrats had chosen taxes increases as their solution to this enormous budget mess.  They seemed oblivious to the reality that increased taxes would only halt job creation by compelling the businesses and individuals that pay these taxes to reduce the number of their employees, curtail any plans to expand, or move out of state to compensate for the new taxes they have to pay.

Fortunately, Friday’s budget and tax votes indicated a shift in thinking among some of the House Democrats.  The bi-partisan votes indicate an abandonment of party-line agenda in favor of objective analysis.  Eight Democrats voted against HB9, a bill to impose a surtax for three years on certain personal income, making the margin of victory for the bill only four votes.  Democrat and Republican opposition to HB270, a bill to take away itemized tax deductions, caused the bill to fail 34 to 33, with ten Democrat votes against it.

There are still some large flaws in our pending budget and tax legislation.  For instance, there are a lot of temporary dollars in the six main House budget bills.  Temporary tax increases are burdensome because they are tax increases that later go away and leave government thirsty.  They also add a variable to the fiscal landscape and make it more difficult for individuals, families, and businesses to plan.  Another problem is that we are simply spending too much and must further decrease our fiscal year 2011 expenditures. 

In the face of great challenges, it is important to remember that the budget process is only half over.  As the budget bill moves to the Senate, we hope the tax and spend liberals will recognize the long term ramifications of this problem and help create permanent solutions rather than temporary fixes.