SANTA FE (AP) — New Mexico expects to collect far less revenue this budget year and next than previously forecast as employment, wages and economic growth lag, a group of state economists said Monday.
The economists from three executive agencies and the Legislature estimated the state's annual revenue stream will decrease by $131 million to $5.6 billion for the current fiscal year, and by $127 million for the fiscal year starting in July.
Falling fossil fuel prices and declining employment in the oil sector have significantly decreased taxes on gross receipts, which provide about one-third of general fund revenues for the state.
The figures presented in Santa Fe set a benchmark for lawmakers who meet in January to shore up state finances and craft a new budget.
The budget crisis has spilled over into courts where public defenders say they cannot keep up with caseloads. Other state agencies and universities are grappling with annual spending cuts as high as 8 percent.
The forecast indicates spending is likely to outstrip operating reserves by $69 million during the current fiscal year. Next year, revenues are expected to fall $93 million short if New Mexico continues to spend at its current pace of just over $6 billion a year.