N.M. governor reconvenes lawmakers in budget showdown

New Mexico Gov. Susana Martinez speaks about the recent legislative session to a group of business leaders and real estate developers during a luncheon. (Photo: AP/Susan Montoya Bryan, file)

Republican New Mexico Gov. Susana Martinez has ordered a special session of the legislature to resolve a grinding state budget crisis, with no sign of a compromise with leading Democratic lawmakers.

Calling legislators to the New Mexico Capitol on May 24, the governor’s proclamation asserts that lawmakers approved a $6.1 billion budget in March that was out-of-balance. The governor last month vetoed tax and fee hikes that many lawmakers say are necessary to shore up funding to public schools, courts and essential public services.

The decision to reconvene lawmakers comes as the Supreme Court weighs accusations that Martinez overstepped her authority by defunding the Democratic-led legislature and all state universities and colleges for the fiscal year beginning July 1 — a step Martinez has said was necessary to avoid a deficit.

The legislature says the governor’s line-item vetoes upset the balance of powers between branches of government outlined in the state’s constitution by “effectively abolishing” the legislative branch.

In a legal briefing Friday, the Martinez administration urged the Supreme Court to stay out of the budget standoff and said her vetoes were made in pursuit of reductions to state spending and never sought to abolish the legislature.

A council of seven state university presidents on Friday said the vetoes and budget stalemate pose a threat to public health by slashing funding to medical facilities including a neonatal intensive care unit, in a legal brief encouraging the Supreme Court to issue a quick decision.

“Some of the damage caused by the vetoes is irreparable,” the brief said, noting that financial uncertainty has reduced student enrollment and undermined recruitment of teaching faculty, physicians and research scientists.

Tuition increases

In mid-March, lawmakers sent Martinez a budget package that would slightly boost spending and includes several tax increases. She responded with line-item vetoes that scratch funding for the legislative branch and cut $745 million in annual general fund spending to state universities, community colleges and specialty schools.

“During this year’s regular session, lawmakers passed an unbalanced budget, along with one of the largest tax increases in state history,” Martinez said in a statement. “That’s unacceptable. We need to balance our budget, address our cash crisis and restore funding for our colleges and universities — without asking families to foot the bill to bail out government.”

The drawn-out feud over New Mexico’s budget shortfalls already has triggered public tuition increases at several state colleges, layoffs at state museums and a shortage of public defenders.

Without a compromise, New Mexico runs the risk of closing down its statehouse and crippling university teaching and research programs for agriculture, medicine and oil exploration, along with specialty schools for the blind and deaf.

The proclamation for a special session is tailored to the governor’s budget priorities, possibly limiting lawmakers’ options.

Senate Majority Leader Peter Wirth accused the governor on Friday of stubbornly pursuing state spending cuts.

“Martinez rejected the responsible bipartisan budget plan passed by the Legislature and unconstitutionally eliminated all funding for higher education and an entire branch of Government,” he said in a statement. “Now she wants to cut her way out of the mess she created.”

Martinez has sought to avoid tax increases by reducing state contributions to worker pensions, eliminating spending on infrastructure and wiping away decades of tax breaks that benefit nonprofits and special business interests.

The Democrat-led legislature had approved its own bill to gradually phase out tax breaks and create a new reserve fund to stabilize state revenues — another item vetoed by the governor.

Wirth said the governor’s suggestions for repealing tax incentives would increase tax burdens on public schools, nonprofit institutions and physicians.

High tension

Democratic Sen. John Arthur Smith, chairman of the Senate Finance Committee, said the state remains in a constitutional crisis, urging the Supreme Court not to delay a decision on the legality of the governor’s vetoes.

He said there have been no substantive recent discussions of the governor’s budget plan with him and other leading Democratic lawmakers.

“We should have ongoing discussions before we go into a special session,” he said.

Martinez last week outlined a rough plan to restore funding to higher education institutions that would rely on closing tax loopholes, possibly by eliminating tax breaks for hospitals and health care providers. The governor’s office has declined requests for further details.

Adding to tensions in Santa Fe, Martinez has directed agencies to draw up plans for to place state employees on unpaid furlough to ensure adequate cash reserves, though state tax income has recovered slightly in recent months.

Anemic state tax revenues are linked to a downturn last year in global energy prices and a tepid economy in a state with the nation’s highest unemployment rate.

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