Moody’s takes note on improved budget outlook for N.M. schools
But forecast for higher ed has ‘challenges’
State funding to New Mexico’s school districts and colleges was the subject of a credit note from Moody’s Investors Service last week, another sign that the credit agency is paying close attention to fiscal issues in New Mexico and other states.
The mention in Moody’s Weekly Credit Outlook for Public Finance released June 29 notes a slightly better budget picture for K-12 school funding in the state and more modest reductions to community colleges and public universities.
Overall the state budget for the fiscal year that began July 1 “is a modest credit positive for school districts, which rely heavily on the state for a median 96.5 percent of revenues,” reports Moody’s. “For community college districts and public universities, the budget is a modest credit negative. … The budget declines are unlikely to materially affect community colleges’ financial profile or public universities’ operations in fiscal 2018.”
The agency reports others challenges for public universities, notably because of lower enrollment and financial aid reductions.
“The New Mexico higher education sector faces challenges. The budget reduction follows steeper cuts in fiscal 2017. Further, all of the state’s public universities and institutes will continue to grapple with a declining number of graduating high school students as well as the recent reduction in the amount of financial aid funded by the state lottery.”
“Moody’s declaration of ‘credit positive’ or ‘credit negative’ does not connote a rating or outlook change,” writes David Jacobson, vice president of communications for Moody’s Investors Service. “It is indicative of the impact of a distinct event or development as one of many credit factors affecting the issuer.”
Moody’s lowered New Mexico’s bond rating last year from the highest level for state governments due to the depletion of cash reserves and an ongoing operating deficit. There was no mention in the credit note of the general fund, which is probably good news for the state, which is finally seeing a small bounce in tax revenues attributed to stronger consumer spending and some accounting changes.
The Texas-based Christus Health System has joined other physician and hospital groups in opposing the repeal of the Affordable Care Act as it is currently proposed in the U.S. Senate.
Christus is the nonprofit parent organization of Santa Fe’s Christus St. Vincent Regional Medical Center, which has greatly benefited from having more of its patients and emergency room services covered by Medicaid and other insurance services.
“Our strategy from when the Affordable Care Act was passed was to maximize the implementation of it and help people get coverage. It’s a core value,” said Gabriela Saenz, vice president of advocacy and public policy for Christus Health.
Saenz told the Corpus Christi Caller Times that the Christus Health mission of providing health care to all has been assisted by ACA, also known as “Obamacare.” If scaled back, there will inevitably be service cutbacks.
“It will impact the people we see on the front line,” she said. “It may mean there will be a reduction [in some areas].”
A congressional analysis of the Senate bill indicates 133,400 patients in New Mexico would lose insurance in the next several years with 55,000 of those being adults who gained coverage with the expansion of the Medicaid program to low-income workers just above the poverty line.
If those patients lose insurance, hospitals are still required under federal law to treat those who come to the emergency room regardless of their ability to pay.