Legislature tries again on state budget

SANTA FE (KRQE) - Ten days after state legislators adjourned their regular session without producing a budget they're back and want to get 'er done.

As it was during the regular 30-day session the state House and Senate have big decisions to make in bridging the gap between spending and expected income that may reach $600 million.

Unlike the 30-day session Democratic leaders in the House and Senate are working off the same plan. Now they just have to sell it to the rest of the members.

"These are hard choices for hard times and right now I'm willing to look at everything," Sen. Pete Campos, D-Las Vegas, told KRQE News 13 earlier Monday.

Republicans leaders are also showing the plan crafted by Democrats to their members.

"We do not favor tax increases," Rep. Anna Crook, R-Clovis, said. "Our stance is that government should be cut versus increasing taxes."

The blueprint calls for cuts averaging 2 percent to state agencies, a 1.2 percent cut to elementary and secondary education, and a 3.5 percent cut to higher education.

The proposed tax increases that would kick in with the 2011 fiscal year on July 1 include:

• 0.25 per cent in gross receipts tax (1 cent per $4 spent)
• 50 cent per a pack of cigarettes.
• Allow cities and counties to reimpose sales tax on foods that was eliminate six years ago but at a lower level than gross receipts taxes. On average, the food tax would be 2 cents on the dollar.

What is not yet clear is if these tax increases are temporary. Gov. Bill Richardson had said he wouldn't sign a tax increases unless they are phased out.

The special session began at 1 p.m. with lawmakers predicting it will take at least two days. Each day they're in session it costs the state an extra $50,000.

The governor's proclamation issued Monday skipped an ethics-reform package some supporters wanted on the agenda and listed eight items for lawmakers to consider:

• The State of New Mexico’s 2011 General Appropriation Act for the continued operation of state government for fiscal year 2011;
• An act authorizing the State Board of Finance to issue capital projects general obligation bonds for purposes of providing funds for capital expenditures for senior citizen facility improvements and acquisitions, for library acquisitions, for public school capital improvements and for state institutions of higher education and state special schools capital improvements, providing for a tax levy for the payment of the principal, interest, and costs related to the issuance of the general obligation bonds and requiring approval of the registered voters at the 2010 general election of the state;
• An act authorizing appropriations from severance tax bond capacity, or from other state funds, for various capital outlay projects statewide and reauthorizing and reappropriating balances of certain appropriations to expand or change purposes, extend expenditure periods and/or change agencies;
• An act authorizing the State Board of Finance to issue, in fiscal year 2011, short-term supplemental severance tax bonds and short-term severance tax bonds upon certification by the secretary of the department of finance and administration that certain conditions exist;
• An act providing for a temporary tax amnesty program;
• An act increasing the cigarette tax, providing for a tribal tax credit stamp for tribes that impose a tribal cigarette tax, adjusting the distributions of the cigarette tax and discounts for tax stamps, amending exemptions from the cigarette tax, and distributing additional revenue to the general fund;
• An act increasing the low income comprehensive tax rebate;
• An act repealing the gross receipts deduction for receipts from certain sales, providing a credit against the state share of gross receipts tax on receipts from certain sales, altering certain distributions to municipalities and counties, increasing the gross receipts and compensating taxes and distributing additional revenue to the general fund; and
• An act appropriating legislative cash balances for the purpose of paying the expenses of the special session called pursuant to this proclamation.