Budget crisis still not fixed

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Session ends with no solution; Wallace sums up impasse

By Roger Snodgrass

The Legislature was supposed to fund a balanced spending plan by noon on Thursday, but when the gavel sounded, lawmakers had failed to pass a $5.5 billion budget for schools and government programs for the fiscal year that begins July 1.


Rep. Jeannette Wallace, R-Los Alamos, Sandoval and Santa Fe, spent a sleepless night Wednesday, as the House worked into the morning hours. Shortly after the session ended Thursday afternoon, Wallace had already heard rumors about plans for a special session to resume the job, starting Wednesday.

Gov. Bill Richardson confirmed the schedule a little later, saying he didn’t want to put it off any longer.

“New Mexico taxpayers want a solution. They don’t want to wait,” Richardson told the Associated Press. “We don’t need another month or two of indecision. I think it’s important that we move as rapidly as we can.”

After the adjournment, House Speaker Ben Luján, D-Santa Fe, said the Senate and House were unable to bridge their differences over increasing taxes to balance the budget. Legislative leaders tried to negotiate a deal to plug a hole in the budget with revenues from gross receipts, income and cigarette taxes.

Still, Luján and House Democrats said they were able to make some progress in the waning hours and believe they will have a good place to start when the special session resumes next week.

“We feel that we have a roadmap in place. We were at the one-yard line and we couldn’t throw the final pass to make that touchdown,” Luján said. “We feel that when we come back, we’ll be able to have a play in place to make that final touchdown.”

“One of the things we’re all saying is if he calls us back too soon, we’ll come back in the same mood, and nothing will get resolved,” Wallace said. “We need to get away from this place. It’s been a big battle the whole month. We’re tired and a little grumpy.”

Wallace blamed the lack of focus on the agenda for raising too many distractions. The Legislature’s 30-day session is meant to deal with the budget, but some non-financial issues can be added to the call.

“Everything under the sun was added to the agenda,” Wallace said, although she also saw a glimmer of a positive side.

“It’s always good to get both sides,” she said. “We kind of know where we’re going when we get back.”

While the House managed to pass a budget, she said, it included $300 million more in revenues than that state expected to collect.

“The Senate said you gave us an unbalanced budget,” Wallace said. “The tax issues on food and cigarettes, all those came into play.”

One bill that stalled would have increased the tax on cigarettes. An attempt to reinstate a tax on a list of groceries, including tortillas, also failed, along with a one-half cent gross receipts tax raise and higher taxes for multi-state corporations. A move to control “tax lightning” on property taxes by limiting increases was rejected as well.

On the food tax, Wallace said her objection had to do with having people tell her how to be healthy.

“They say, ‘We don’t think you should eat flour,’ ”

Wallace said. “I don’t think that was fair to the public.”

Given the bare choice of taxing or cutting expenses, Wallace said, “You have to cut.”

She said the $2 billion increase in state spending during the Richardson administration provided an ample target for cuts.

But with the overwhelming portion of the budget devoted to public education, higher education and Medicare, everything else that might be cut — including the courts, libraries, public  safety and the department of health — are such a small piece of the pie.

“We have to look at the entire budget,” she said.

The Associated Press contributed to this story.