Sunday, October 18, 2009

Sen. Keller urges fiscal responsibility in special session

Freshman New Mexico Senator Tim Keller introduced three bills during the opening of the special session. He said they're all aimed at making the state's finances more fiscally responsible.

“The Governor has called us all up here and we are costing the state money each day we are in session," Keller said. "The least we can do is work on these issues; there is lots of dead time as we wait for all the various sides to negotiation the budget. This is a matter of principle, these bills should be germane in that they directly impact to our state budget solvency."

While the legislature ruminates over the specifics of the budget solvency package there is an opportunity for lawmakers to work on related legislation to improve our state’s fiscal situation,” Senator Keller stated.

The specific pieces of legislation will now go to Committee’s Committee to determine if they are germane for the special session.

Senator Keller’s proposals that include a tax expenditure bill that mirrors a 2007 bill which would require the state to track all tax expenditures and incentives, such as the ones currently being offered to the film industry, and their associated benefits.

“We are going to need this going forward to deal with structural problems in our government financing," Keller said. "This bill is long overdue, all interim we have been debating what works and what don’t in terms of incentives and tax subsidies. We are one of only 9 states that doesn’t track return on investment on these. It’s time we start making good analytical decisions based on data rather than economic guesstimates.”

Keller also introduced a bill for forecasting that has a circuit breaker provision in it.

Currently the state bases the budget on forecasts made by key individuals at different times in the year. Keller's bill would adjust on a proportional basis any cuts that are made in the special session to compensate for any increase in revenue estimates.

“A circuit breaker provision is really just about sounds financial planning; historically we have been up to 12% wrong in our forecasts as a state," Keller said. "This bill would give us an automatic adjustment to restore funding that was cut based on incorrect estimates."

He also introduced a federal match funding exclusion bill designed to protect the budget from negative multiplier effects, which would result in cutting state funds that are matched by federal funds.

“It's convenient for politicians to do across the board cuts, but when we cut Medicaid at the state level until we realize that for every 1 dollar we cut, we lose 4 dollars in federal funds," Keller said. "Cutting this type of matching fund is like throwing free money way."

Both the house and the senate are expected to reconvene the special session just after 1pm today.

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