State windfall stirs up feeding frenzy
Like chum in shark-infested waters, news of the state’s revenue windfall has stirred up a feeding frenzy.
But while a projected $1.4 billion in “new money” available for expanded spending in the 2021-2022 fiscal year certainly opens the door to options, it’s important to remember that we have existing, substantial obligations. Before the state creates new programs, we need to ensure our financial foundation is sound and that existing, successful programs are supported fully.
This includes shoring up shaky pension funds for employees in state and local government, public schools and higher education. These workers have earned their retirement benefits, and the state has a legal and moral obligation to provide them, but the funds are insolvent. Together, the Public Employee Retirement Association and Education and Education Retirement Board funds are $15.7 billion short of what they need to provide for existing retirees and working employees already in the retirement system.
Along the same lines, data on state employees indicates the state’s pay schedule continues to drag behind the market, making it hard for agencies to attract and keep the best employees. A failure to attract enough quality employees can hamstring essential services, with consequences ranging from inconvenient to deadly, and investing in new initiatives only exacerbates the problem.
The list goes on — from the need to replace the one-time federal money that shored up the state budget this year to restoring the many, many positions cut from environmental protection agencies over past administrations to boosting the potentially inadequate formulas used to fund effective, critical public school services.
Fortunately, budget drafters aren’t working blind. The Legislative Finance Committee, which drafts a spending plan for consideration by the full Legislature, works from budget guidelines that outline priority spending areas and identify the elements that make a program worth the investment.
The committee’s highest priority continues to be public schools, followed by public health, workforce development, public safety, protections for vulnerable citizens, economic growth and transportation infrastructure. Increases will be focused on programs that we know will provide a strong return on the investment. At the same time, committee members will be looking for services that can be cut because they are redundant, ineffective or can be provided more efficiently.
The committee also has set guidelines for revenue measures, with an eye toward expanding the state’s tax base to allow for lower rates and temper the state’s over-reliance on the oil and natural gas industry. And, indirectly a budget issue, we plan to carefully review how best to get a handle on crime.
No doubt, budget drafting is more rewarding when revenues are strong than when they are weak. It’s heartbreaking to cut essential services during a downturn. But it’s only a little easier to sort through the clamor of new ideas, mostly well-intended but not always well-thought-out.
Rep. Patricia A. Lundstrom, executive director of the Greater Gallup Economic Development Corporation, has served in the New Mexico Legislature representing McKinley and San Juan counties since January 2001. She is chairwoman of the Legislative Finance Committee and House Appropriations and Finance Committee. She is also a member of the House Transportation, Public Works and Capital Improvements Committee.