Special Statement from Democrats in NM Legislature

This post is originally from Democracy for New Mexico. If you don't read it already, you should visit the site:

Weary Senate Democrats came together today to bring the special session to an end by passing two important bills – the House Appropriations and Finance Committee Substitutes for House Bills 17 and 33 (HB 17), and the House Appropriations and Finance Committee Substitute for House Bill 6 (HB 6). HB 17 was passed by the Senate with 5 amendments, requiring the House to consider the amendments. The House concurred with four of the amendments, and asked the Senate to recede from a fifth amendment. Once the Senate receded, the stage was set for both bodies to end the session by adjourning “sine die.” Both the Senate and House adjourned at approximately 7 PM.

As passed by the House and Senate, HB 17 – along with Senate Bills SB 10 and SB 13 – would give flexibility to school districts in making budget adjustments to accommodate education cuts that, after offsets enacted by the legislature would reduce total education funding by less than 1 percent. Under HB 17, recurring General Fund expenditures would be offset by nonrecurring General Funds and federal stimulus education funds. HB 17 also funds an emergency school relief fund using $3 million in nonrecurring funds to try and keep small rural schools harmless. An additional $29 million would be transferred from the Public School Capital Outlay Fund to cover public school insurance payments.

In explaining the details of HB 17, Senator John Arthur Smith(D-Hidalgo, Luna & Sierra-35), Chair of the Senate Finance Committee, noted on the Senate Floor that because the requirement in the Governor’s Proclamation to hold Education as harmless as possible, deeper cuts had to be made in general government operations, including a reduction of approximately 7.6 percent for executive agencies. Cuts in the General Fund for Developmental Disabilities program and most of the cuts in Medicaid will be offset with federal stimulus funds. Some smaller agencies, like the State Police, were exempted from the larger cuts. The Governor was also asked to reduce salaries for 102 exempt positions.

HB 6 authorizes a transfer of $225 million from the Operating Reserve to the General Fund. The transfer would take care of the deficit for the past fiscal year and leave a smaller amount to help cover shortfalls for the current fiscal year. HB 6 also authorizes the Governor to transfer up to $115 million from the Tax Stabilization Reserve to the General Fund in the event existing funds cannot satisfy appropriations from the General Fund.

Passage of HB 17 and HB 6, taken in conjunction with passage of HB 3 (which ‘sweeps’ about $100 million of unused state funds into the General Fund), and Senate Bill 13 (which give public schools the flexibility to adjust class loads, staffing patterns and other programmatic matters) has allowed the Senate and the legislature as a whole to complete its painful work of coming up with the best possible solution to the immediate financial crisis within the limitations imposed by the Governor.

“When you have huge needs and disappearing monies to fund them, everyone ends up feeling the pain of the corrections that need to be made to sort out those needs and make the difficult decisions to fund some more than others in order to minimize the damage that will follow from those decisions. When the legislature returns this January, we will have to continue to look for other solutions to the continuing erosion of our state revenues,” said Senator Michael S. Sanchez (D-Valencia-29), Senate Majority Leader.

“This is certainly not a perfect response to our budget crisis, but under the circumstances – the Governor’s limitations and the uncertainty of how much we will ultimately need to deal with this situation when we come back for the regular session in January – this is at least something that will get us through the next several months,” said Senator John Arthur Smith (D-Hidalgo, Luna & Sierra-35), Chair of the Senate Finance Committee.

“I want to thank my fellow legislators for coming up with immediate solutions for our budget woes that will at least enable us to get to the regular legislative session in January and continue this difficult work of funding our essential government and education services,” said Senator Carlos R. Cisneros (D-Los Alamos, Rio Arriba, Santa Fe and Taos), Vice-Chair of the Senate Finance Committee.

“The Senate has worked countless hours during this compressed timeframe to preserve education and save state government employees’ salaries in every way we could conceive. I appreciate the contributions made by all the parties to our discussions and debates, and am thankful that we could come together with solutions that meet the needs of these difficult economic times,” said Senator Howie C. Morales (D-Catron, Grant & Socorro-28).

“We’ve worked hard over these past seven days to come to an agreement that treats everyone affected by the state budget as fairly as possible, while at the same time saving Medicaid and minimizing the cuts to education,” said Senator George K. Munoz (D-Cibola & McKinley-4).

“My mission coming into this special session was to minimize cuts to education and Medicaid. With all the provisions we’ve worked hard to pass, keeping education cuts to less than 1 percent provides protection for our students and teachers. We also further supported education by eliminating delays in funding for the Education Retirement Board program,” said Senator John M. Sapien (D-Sandoval-9).

He pointed out that he was glad to have been able to help stave off an effort to delay providing this funding until a future fiscal year: “In the long run, this will save the state money because the funding we provide now will be leveraged upward whenever the market recovers, making each dollar used to fund the program now worth much, much more in the future.”