Gov. threatens budget veto

SANTA FE (KRQE) - The $5.6 billion spending plan for the budget year that begins in July is on its way to the governor's desk about two days early. But Tuesday, Gov. Susana Martinez indicated lawmakers aren't quite in the clear yet.

The legislative session, which is primarily held to pass a budget, ends Thursday at noon.

Martinez told reporters she will likely veto the budget if legislators don't pass some of her tax and education reforms. Vetoing the budget would mean lawmakers would be back for a special session.

Martinez said her tax and education proposals go hand-in-hand with the budget that the legislature approved. Part of the spending plan includes money for reading initiatives and about $37 million for possible tax cuts.

The governor is pushing lawmakers to pass a bill that would end social promotion, which allows kids to move to the next grade even if they can't read proficiently. Martinez also wants the legislature to exempt about 40,000 small businesses from paying gross receipt taxes and to give tax breaks for businesses that hire veterans returning from duty.

"Right now we don't have a comprehensive tax reform that's part of the budget that's being proposed, so we're going to keep working with the legislature so we can make that a bigger part of the package," said Martinez.

When asked if Martinez would call the legislature back if it doesn't take action on those issues, she answered: "If I veto the budget, they would have to."

The governor's tax reform bills are slowly making their way through the process. Late Monday night, the Senate passed the social promotion bill the governor supports. A similar version was waiting for a full House vote on Tuesday afternoon.

Legislators said there is still time to get important bills passed, but some were critical the governor said she would veto the budget.

"We've acted in good faith, not with a small marginal majority, but with an overwhelming bipartisan efforts, so I would encourage her to calm down, be quiet and think through this thing more deliberately," said Sen. John Arthur Smith, D-Deming.

The governor has until March 7 to sign, veto or line-item veto parts of the budget.