Updated: Friday, 29 Apr 2011, 4:25 PM MDT
Published : Friday, 29 Apr 2011, 4:10 PM MDT
ALBUQUERQUE (KRQE) - A key bill that died in the final hours of the legislative session is beginning to have a major impact. Dozens of projects are now unfunded and according to several contractors, thousands of workers will lose their jobs because the legislature did not pass $240 million worth of capital outlay bonds.
The projects range in size from $200,000 to upgrade ventilation systems at Workforce Solutions to $100 million to fund state road improvements.
"From an industry perspective, it's very devastating," said Vicki Mora, CEO of the Associated General Contractors.
Capital outlay projects are funded by taxes collected on natural resources extracted from New Mexico. Mora said commercial construction workers depend on the funding. She estimates a loss of 7,000 jobs and a decrease of nearly $16 million in gross receipt taxes.
"Of course that employs craftsmen, design firms, engineering firms if the project is of that size, so all those communities are impacted," said Mora. "The fact that we don't have any money going into public projects is extremely disappointing."
But budget analysts and legislators won't diagnose the problem that severely just yet. First, about $60 million can be redirected through the Public School Capital Outlay Council. Also, analysts said it could take months for bonds to be purchased, meaning even if the legislature passed the capital outlay bonds, it doesn't mean the money would have been readily available.
"The money doesn't come right away," said Sen. John Ryan, R-Albuquerque. "But it does give a guarantee to the contractors that those projects will be completed in the near future."
Ryan said important projects will still see capital outlay funding, but there may be a short delay. He said the issue will likely come up during the redistricting special session in the fall.
The governor's office has not announced what will be on session's agenda but said capital outlay funding could make an appearance. Both Gov. Martinez, the Department of Finance and several legislators said they're looking to improve the review process when projects are proposed. Currently, there is no system in place that prioritizes projects.
"With dollars diminishing to our state, we need to do a better job of prioritizing and making sure these projects are meeting specific criteria," said Ryan.