'Frontier' slips into spending talk

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By Harold Morgan

Last week we looked at highlights of the 2012 legislative session, through the policy eyes of the Legislative Council Service. This week it’s the money, thorough the eyes of the Legislative Finance Committee.
Planning spending means building the budget. The job starts with the spending expected in a given budget year, say, Fiscal Year 2012, which ends June 30. That base is matched against expected revenue for the following year, FY 13.
For FY 13, the money will come into the general fund, the state’s main font for spending, from sales taxes (43 percent), income taxes (individual and business), energy (16 percent), investments (16 percent) of the money from energy, and from “other” (four percent).
One of our unusual governmental traits is preparation of two budgets, one by the Legislative Finance Committee, the other by the governor. When the two recognize reality, the budget disagreements are modest, a nice change from the last few years of the Richardson administration.
In the 2012 session, the Legislature and the governor together decided to spend $5.65 billion during FY 13, after a few vetoes by Gov. Susana Martinez. That money will go for public schools ($2.455 billion, 43 percent of the total), Medicaid ($1.105 billion, 20 percent), higher education ($758 million, 13 percent), public safety ($368 million, 7 percent), and “other” or everything else ($965 million, or 17 percent.) Just the “other” 17 percent comes to around $439 for every New Mexican.
Spending -- what is called recurring appropriations -- is projected to increase 2.7 percent per year during the following two years, FY 14 and 15. The increases include using recurring revenue to replace “solvency” measures from past years, such as diversion of tobacco settlement money to Medicaid.
Recurring spending means doing what we’re doing and not adding new programs on top of existing programs. In turn, new things above projected growth will draw money from existing things.
Two examples of things that won’t happen, courtesy of Martinez’s vetoes, are spending $75,000 promoting “adventure tourism” in McKinley County and placing “a law enforcement employee” at the proposed Pecos Canyon State Park. That the park proposal lives seems dubious.
At 4 percent per year, Medicaid will lead spending growth the next two years, following by public schools at 3 percent. Higher education, public safety, and other health and social services programs will grow 2 percent annually.
Everything else increases 1 percent annually. Throw in an inflation adjustment and all the other places for spending—economic development and tourism promotion, cultural affairs, African American affairs, energy, environment, the Spaceport and much more—all of which generate passion in their favor, will decline in real terms.
An economic development commitment came with the $7.9 million set for the Job Training Incentive Program, a six-fold increase for a favorite developer tool. The program partly reimburses certain expanding or relocating firms for training people in newly created jobs.
The intriguing sidelight comes from directing some of the training money “for rural, frontier and distressed areas.”
I have heard of “frontier” New Mexico, courtesy of Rep. Richard Vigil, who gave a lengthy discourse on the joys of his home town, Ribera, population 416 in 2010, at an interim committee meeting in Grants last summer. Vigil’s only real argument was that frontier New Mexico, by which he meant Ribera, should get more attention and money from state government.
Located 1.5 miles from Interstate 25 exit 323, Ribera is on NM 3, with two communities, El Ancon and San Miguel, a mile or so away. Las Vegas is about 20 miles further. While definitely rural, Ribera hardly seems frontier, whatever “frontier” means. But for those seeking government money, creating a new victim category is a good approach.
Harold Morgan
NM News Service