Budget talks undermined by governor
Much better communication needed in coming negotiations
As one of the 112 state legislators who worked our tails off during the 2017, 60-day legislative session, I was both irritated and confused by the governor’s comments that we had “wasted time” and failed to accomplish our primary responsibility during those two months.
Then, when she vetoed $800 million — 13 percent — out of a $6.1 billion budget for 2018 because we had used $180 million — 3 percent — of new taxes to balance spending, and did so by chopping both the entire higher education program and the $18 million for all legislative operations, those feelings intensified into outright anger and dark suspicion.
I honestly wonder if the governor talks to her staff. I know she doesn’t talk to most legislators of either party, but I thought she occasionally discussed with assistants assigned to talk to our leaders what was happening just three floors beneath her office. They could have told her what was going on — and what was in the budget — no surprises.
That would have given her an opportunity before the session ended, as the budget was shaping into its final form, to call “time out, guys” and ask for a reworking of whatever she found offensive. Instead, we’re playing this childish game of chicken: Who will blink first? No matter who flinches, it’s New Mexico that loses.
Every time the budget was discussed in the Senate the question was: Will the governor sign the revenue bill? What are her negotiators telling you? Can we count enough on her avowed openness to “plugging loopholes” to send these four tax changes up? The answer was always, “We think so.”
We needed the $180 million to maintain spending in 2018 at the level we had planned to spend in the current year but had to reduce when tax receipts dipped. Without HB 202 revenue, we would have to cut another 3 percent out of the budget, taking us back to spending levels of five years ago.
And while we knew the governor has taken a blood oath to never increase taxes, we had reason to believe that the four major sources of new revenue assumed in HB202 might pass through her filters because they all could be framed as “loophole plugs”. Here they are:
$40 million from internet sales tax. Amazon has announced they will voluntarily begin making those payments, and most states are quickly moving to do this as it protects local merchants against unfair competition;
$80 million from hospitals in the form of a “provider fee” that hospitals voluntarily expressed a willingness to pay in order to ensure that if most of it matches federal Medicaid money on a 4-to-1 basis, cuts in Medicaid reimbursements will be unnecessary;
$50 million from a 1 percent increase in our vehicle excise tax, moving it from 3 percent to 4 percent, a rate still below all our neighboring states; and
$10 million from increasing permits on interstate truckers from $5 a year, the lowest of any state, to $100 a year, still below the average for such fees.
All of those had been discussed with the governor’s lieutenants. The reports we had were that she was “open” to using them to balance the budget — not committed, but “open.”
If we are to reach an accord during the special session, it will take communication far above what we have ever enjoyed with the governor, not with her aides — with her, no surprises for either branch. It’s hard for 112 individuals to initiate conversations with the governor. Far more productive would be for the single chief executive to ask for weekly meetings with just three key Senate leaders and three key House leaders to discuss her proposals and keep the meetings going until common ground is reached. That is what “executive” means; it’s her job description.