New Mexico state budget
Contents |
| New Mexico | |
| Annual | |
| Fiscal Year | 2013 |
| Signed into law | March 2, 2012 |
| GF Revenue | |
New Mexico faces potential budget issues for FY2011.[1] In March 2010, Gov. Richardson vetoed a proposed tax on food, but signed other tax increases that will provide about $170 million next year to help balance the budget.[2] The states revenues are down by 40 million in 2010, and it's expected to negative $159.3 million by 2011, $257.6 million by 2012.[3][4] Gov. Bill Richardson and legislators are relying on that money to avoid more spending cuts in the upcoming 2011 fiscal year.[1] Gov. Richardson said then that he thought the taxes would be sufficient to balance the budget, and he also planned on $20 million of federal funds stimulus funds to shore up the budget.[1] Lawmakers have criticized the Governor's reliance on one-time sources.[1]
FY2010 State Budget New Mexico faced a $454 million shortfall in building its FY 2010 budget during the regular 2009 Legislative Session. A $5.47 billion General Fund budget was passed by the New Mexico State Legislature and signed by Gov. Bill Richardson, $538 million (9%) less than the FY 2009 General Fund budget. A complete breakdown of the FY 2010 budget that started July 1, 2009 includes:[5]
- $5.47 billion General Fund
- $2.71 billion Other State Funds
- $1.22 Internal Service/Interagency Transfers
- $5.55 billion Federal Funds
Total $14.96 billion
The New Mexico Legislative Finance Committee predicted 5% revenue growth for FY 2011 and 2012 allowing replacement of federal stimulus funds.[6]
State revenue estimates upon which the FY 2010 budget was based proved to be too optimistic, requiring the New Mexico Legislature to meet in a special session in October of 2009 to close a $653 million deficit.[7] The special session made 7.6% cuts in most state agencies on top of the 6.4% cuts already made during the regular 2009 Session.[8] Gov. Richardson has until Nov. 12 to take action on all bills passed by the Legislature during the special session, which includes $153 million in cuts in the state's Human Services Department that impact Medicaid.[9] Gov. Richardson proposed 3% across the board cuts and leaving education exempt before the special session convened October 17, 2009.[10] The current debt per capita is $1,398.[11]
Recently, it was revealed that the state gives away $1.3 billion annually in tax credits, and if the legislature tightens the tax credits by 20 percent the deficit would be eliminated.[12]
Outlay funds The state has identified $1 billion in outlay funding, approved since 2005, remains unspent.[13] Capital outlay funds are collected through "voter-approved general obligation bonds, paid off with property taxes; severance tax bonds, backed with tax revenue from oil and mining activity; and non-recurring general fund revenue" according to the New Mexico Watchdog.
Economic Freedom
A new Fraser Institute report on economic freedom ranks New Mexico 50th in economic Freedom. Delaware ranks 1st. The study examines the impact of economic freedom on both the level of economic activity and the growth of economic activity. According to the study, the freest economies operate with minimal government interference, relying upon personal choice and markets to answer basic economic questions. More governmental restrictions on those choices curbs economic freedom. The study looks at three major categories per state – size of government, taxes and regulations. [14]
FY2012 State Budget
- See past state budgets
Legislative Proposed Budget
Lawmakers have sent the governor a blueprint for spending $5.4 billion next year on education and governmental programs, ranging from prisons and courts to health care for the poor. The measure cuts spending by $152 million, 2.7 percent, from FY2011. A bill capping film production rebates at $50 million a year freed up $23 million that went into the budget for schools, health care and public safety programs.[15]
Martinez has until early April to sign or veto bills passed during the Legislature's 60-day session, including budget bills.[15]
Pensions
Lawmakers saved $111 million in the FY2012 budget by reducing government contributions to public employee pensions and also requiring state workers and educators to offset that by paying more into their retirement programs. The measure also allows the government to skip making higher contributions to an educational pension program that were mandated by a 2005 law.[15]
Governor's Proposed Budget
Governor Susana Martinez proposed a FY2012 state budget that reduces state spending by 3% and does not raise taxes.[16] The governor's proposed budget can be found here.
The governor's proposed budget is is based on estimates from December 2010 that the state’s revenues will increase 4.4 percent from FY2011 to FY2012. The budget reduces administrative costs from education, which reduces the education budget by 5%, and cuts the state environment department.[16] It also cuts the auditor's budget by 8.8%.[16] The proposed budget would also have the state contribute $39 million less to employee pensions in FY2012 and have employees contribute 2% more than they currently do. Teachers, however, would not have to make additional the additional contribution.[16]
The House approved its version of the budget, House Bill 2, on March 2, 2011, and it now heads to the Senate.[17]
The biggest different between the governor's proposed budget and that set forth by the Legislative Finance Committee is that the LFC suggested cutting the corrections by $11 million and Martinez's cut were less dramatic so as to avoid the early release of prisoners.[16]
Budget transparency
- See sample transparency legislation at the Sunshine Standard
Government tools
The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary | |
|---|---|---|---|---|---|---|---|
| Sunshine Portal NM |  |
 |
|
|
|
|
- Line item expenditures are not fully provided, as expenditures are only listed to a categorical level.[18]
- Contracts are listed under the purchases section.[19]
- Agency and department budget details, including balances, are posted.[18]
- Employee salaries are listed.[20]
- See also: Evaluation of New Mexico state website
Multi-Measure Budget Transparency Profile
The Institute of Government and Public Affairs at the University of Illinois has created a multi-measure transparency profile for New Mexico, which measures state transparency as of September 2011 using indicators from a range of organizations, including Sunshine Review. These indicators measure both website transparency and other recognized facets of governmental transparency. In addition, IGPA presents four unique indicators of non-transparency based on the observation that transfers or reassignments between general and special funds can obscure the true fiscal condition of a state.
In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.
Budget Background
The New Mexico State Legislature convenes in regular sessions on the third Tuesday in January each year. The Legislature meets for 60 days in odd-numbered years and 30 days in even-numbered years.[21] The General Appropriations Act passed by the Legislature is effective upon being signed by the Governor. Other appropriations with emergency clauses require a two‐thirds majority vote. The Governor can veto selected lines and items in any bill carrying an appropriation.[22]
Accounting Principles
The New Mexico State Auditor is required by New Mexico law to conduct annual financial audits of all government agencies. The State Auditor’s Office administers a competitive process whereby audit firms may submit applications and proposals to perform financial audits of certain agencies. Hector Balderas was elected New Mexico State Auditor in November 2006. The Office of the New Mexico State Auditor is a constitutionally established office, allowing the State Auditor to serve two consecutive four year terms. Additionally, the Audit Act, §§ 12-6-1 to 12-6-14, NMSA 1978, provides the laws in which the State Auditor operates. Audit reports are not currently published online.[23]
The State Auditor has two statutory purposes:[24]
- Ensure that the financial affairs of every agency shall be thoroughly examined and audited each year by the state auditor, personnel of the State Auditor’s Office designated by the State Auditor or independent auditors approved by the state auditor and
- Cause the financial affairs and transactions of an agency to be audited in whole or in part. Section 12-6-3, NMSA 1978. These two statutory purposes grant the State Auditor the authority to conduct both financial and special audits.
The Institute for Truth in Accounting (IFTA) rates New Mexico “Worst” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider New Mexico's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care. New Mexico is "worst of the 6 worst" taking and average of 602 days to issue its CAFRs for FY 2005, 2006, and 2007.[25] New Mexico's CAFRs are prepared and published online by the New Mexico Department of Finance and Administration, Financial Control Division.[26]
Anthony Armijo is State Controller and Director of New Mexico Financial Control Division, Department of Finance and Administration.[27]
| Credit Rating | Fitch | Moody's | S&P |
| New Mexico[28] | NR | Aa1 | AA+ |
Stimulus
New Mexico has received $1.7 billion in federal funding from the American Recovery and Reinvestment Act of 2009.[29]
Public Employees
According to 2008 Census data, the state of Colorado and local governments in the state employed a total of 144,852 people.[30] Of those employees, 118,633 were full-time employees receiving a net pay of $403,244,024 per month and 26,219 were part-time employees paid $25,713,036 per month.[30] More than 58% of those employees, or 84,481 employees, were in education or higher education.[30]
External links
- State Budget Solutions, New Mexico
- Model transparency legislation from the American Legislative Exchange Council is available at this link.
- Rio Grande Foundation
- New Mexico Department of Finance and Administration, Budget Division
- Governor's Office
References
- ↑ 1.0 1.1 1.2 1.3 Budget Week "Analysis: NM could face more budget trouble" April 5, 2010
- ↑ NewMexican.com
- ↑ New Mexico Watchdog, Gov’s estimates were wrong: NM rev down by $32.5m for 2010, $159.3m for 2011, July 21, 2010
- ↑ New Mexico Watchdog, Sobering stats on the NM budget: You sure you want the Gov’s job, Susana and Diane?, Oct. 20, 2010
- ↑ New Mexico Legislative Finance Committee, "Fiscal Impact Report General Appropriation Act of 2009," March 19, 2009
- ↑ New Mexico Legislative Finance Committee, "Fiscal Impact Report General Appropriation Act of 2009," March 19, 2009
- ↑ Associated Press, "New Mexico Legislature convenes in special session Saturday to deal with $650M budget deficit," October 16, 2009
- ↑ New Mexico Independent, "Is the guv getting ready for line-item vetoes?," October 26, 2009
- ↑ Gov. Bill Richardson Press Release, "$153 Million in Budget Cuts Will Have Devastating Impact on Services for New Mexicans," October 27, 2009
- ↑ National Conference of State Legislatures, "Fiscal Year 2010 Budget Status," October 28, 2009
- ↑ New Mexico Watchdog, Aug. 3, 2010
- ↑ New Mexico Watchdog, A budget breakthrough? Committee finds NM gives away $1.3b a year in tax credits, exemptions and deductions, Sept. 14, 2010
- ↑ New Mexico Watchdog, More Than $1 Billion Unspent in NM Capital Outlay Funding, Aug. 11, 2010
- ↑ Fraser Institute, Economic Freedom of North America 2012
- ↑ 15.0 15.1 15.2 Businessweek "NM Legislature approaches finish line of session" March 18, 2011
- ↑ 16.0 16.1 16.2 16.3 16.4 The New Mexico Independent "Martinez budget proposal cuts 3 percent" Jan. 11, 2011
- ↑ The New Mexico Independent "House narrowly passes budget" March 2, 2011
- ↑ 18.0 18.1 Transparency Portal NM Budget
- ↑ Transparency Portal NM Purchases
- ↑ Transparency Portal NM Employees
- ↑ New Mexico Legislature Web site, retrieved November 1, 2009
- ↑ National Association of Budget Officers, "Budget Processes in the States," 2008
- ↑ New Mexico State Auditor Web site, retrieved November 1, 2009
- ↑ New Mexico State Auditor Web site, retrieved November 1, 2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ New Mexico Department of Finance and Administration, Financial Control Division Web site, retrieved November 1, 2009
- ↑ The National Association of State Auditors, Comptrollers and Treasurers Web site, retrieved November 1, 2009
- ↑ State of Indiana, “State Credit Ratings-as of June 24, 2009"
- ↑ Recovery, "Stimulus Spending by State"
- ↑ 30.0 30.1 30.2 2008 Illinois Public Employment U.S. Census Data
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