The budget meets its Waterloo

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By Jay Miller

SANTA FE — What will come from the special legislative session that started Saturday? It may be the state’s most important special session ever.

Gov. Bill Richardson and lawmakers will have to plug a budget hole of some $700 million. That’s a $700 million shortfall that has occurred since last March when the 2009 session ended.  By August, it was up to $400 million. In September, it climbed to $550 million. And now it’s October.

New Mexico runs behind the curve when it comes to anything economic. We were slow to go into the recession and will be slower than the rest of the nation to come out. That means we’re still in a free-fall.

Richardson had hoped to use mostly short-term, one-time fixes during this special session but there’s just not that many corners that can be swept.

There will be some pain that will come out of this session. Richardson wants to shield education from being hit. Legislative leaders say that will necessitate a 16 percent slash to state agencies.

Education is the top priority of the state and these people must decide where that line should be drawn.

During the last big economic downturn in the early ’80s, Republican lawmakers tended to want to make education’s slice of the pie bigger while Democrats wanted to make the pie bigger.

There seems to be general agreement among all parties not to get into tax law in order to make the pie bigger yet. One of the few agreements that has been reached is to attempt to stay away from furloughs or layoffs. Salary cuts, however, appear to be on the table for everyone.

As a school board member back when school budgets had to be cut previously, I’ll warn everyone in a decision-making capacity that cuts involving school children are about as controversial as anything gets.  

Closing small schools that are losing enrollment is a way to save considerable money. That, of course, involves every student in the school — and every parent. School board meetings overflowed. A recall petition was started against me for even suggesting the idea.

Cutting program offerings is also touchy. We looked at dropping music, art, physical education and/or non-revenue-producing sports competition.

There’s no better way to get a parents’ club organized for the band than to suggest eliminating band. The same goes for chorus, art, theater, dance and every minor sport.

“Back to basics” was a popular phrase back then. Every parent group that made a presentation to our board listed the three Rs plus the course offering that group was supporting as being the basics.

Give our board credit. We were smart enough not to touch major high school sports. That seems to be one of the big fears right now. The only cuts likely are a tightening of expenses for travel, meals, equipment and maintenance.

Here’s a tip to school districts. Invite your local legislators to attend school board meetings when budget cuts are being discussed. You want to be sure they get the full picture.

There’s little telling what salary cuts for public employees will do. They might not cause as big an uproar at the time but political consequences at the next election are a possibility.

Public employee unions have sued over the one percent cut every public employee took beginning in July as a result of the Legislature transferring part of the retirement payment from public employers to employees.

What alternatives are there to all these cuts? Public employees have suggested rolling back tax cuts for the wealthy passed during Richardson’s honeymoon back in 2003. And then there’s that tax that out-of-state corporations aren’t paying on New Mexico profits. Revenue from the aforementioned sources would about cover the shortfall.

One problem with tax increases is that they don’t bring in revenue immediately and lawmakers need their cuts to go into effect the end of this month.

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