New Mexico state budget (2009-2010)

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Note: This article was last updated in 2010. Click here for more recent information on state budgets and finances.

New Mexico faced a $454 million shortfall in building its FY 2010 budget during the regular 2009 Legislative Session. A $5.47 billion General Fund budget was passed by the New Mexico State Legislature and signed by Governor Bill Richardson, which was $538 million (nine percent) less than the FY 2009 General Fund budget. A complete breakdown of the FY 2010 budget that started July 1, 2009 includes:[1]

  • $5.47 billion General Fund
  • $2.71 billion Other State Funds
  • $1.22 Internal Service/Interagency Transfers
  • $5.55 billion Federal Funds

Total $14.96 billion

2011 State spending & deficit in billions[2]
Total spending Pension Healthcare Education Welfare Protection Transport Debt
$14.5 $1.5 $5.4 $2.6 $1.1 $1 $1.3 $$8.90
2011 Local spending & deficit in billions[2]
Total spending Pension Healthcare Education Welfare Protection Transport Debt
$9.9 $0.00 $0.3 $4.0 $0.2 $1.1 $0.60 $5.8

Find the state’s FY 2010 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.

The New Mexico Legislative Finance Committee predicted five percent revenue growth for FY 2011 and 2012, allowing replacement of federal stimulus funds.[3]

State revenue estimates upon which the FY 2010 budget was based proved to be too optimistic, requiring the New Mexico Legislature to meet in a special session in October of 2009 to close a $653 million deficit.[4] The special session made 7.6 percent cuts in most state agencies on top of the 6.4 percent cuts already made during the regular 2009 Session.[5] Gov. Richardson had until November 12, 2009 to take action on all bills passed by the Legislature during the special session, which included $153 million in cuts in the state's Human Services Department, which impacted Medicaid.[6] Gov. Richardson proposed three percent across the board cuts and leaving education exempt before the special session convened October 17, 2009.[7] The debt per capita in FY 2010 was $1,398.[8]

It was revealed that the state gave away $1.3 billion annually in tax credits, and if the legislature tightened the tax credits by 20 percent, the deficit would be eliminated.[9]

Budget background

The New Mexico State Legislature convenes in regular sessions on the third Tuesday in January each year. The Legislature meets for 60 days in odd-numbered years and 30 days in even-numbered years.[10] The General Appropriations Act passed by the Legislature is effective upon being signed by the governor. Other appropriations with emergency clauses require a two‐thirds majority vote. The governor can veto selected lines and items in any bill carrying an appropriation.[11]

The Federal Stimulus Package

The State of New Mexico submitted 215 projects for funds from the American Recovery and Reinvestment Plan.[12] The funding request for 215 projects totaled $2,937,146,132 for the cities of Alamogordo, Albuquerque, Bayard, Espanola, Las Cruces, Rio Rancho, Santa Fe, and Silver City.[13]

A report by New Mexico Watchdog showed that the stimulus was creating very few new jobs in the state. The vast majority were public sector jobs. The state had seen an increase of only 332 stimulus-funded jobs over the previous quarter, though the stimulus provided over $2 billion in funds. Additionally, the number of jobs created had barely budged since October 2009.[14] A May 4, 2010, press release from the New Mexico Office of Recovery and Reinvestment claimed 3,009 jobs full-time jobs funded. Of those jobs, 2,271 were in public education.[14] The Santa Fe Reporter found that federal stimulus money created only 2 private sector jobs in Santa Fe.[15]

Recently, Gov. Richardson defended the $2.8 million in stimulus funding that was spent on a wild horse sanctuary, but Senator John Arthur Smith strongly disagreed.[16] While that project was still under debate, funds had already been approved to renovate Los Luceros ranch, the state-owned ranch that was headquarters for a film institute run in collaboration with Robert Redford.[17]

ARRP errors

On November 16 and 17, 2009, many errors were found in the $747 billion plan. It set aside money for districts that did not exist. According to Recovery.gov, the plan showed its funds would go to 884 Congressional Districts, though there were only 435.[18][19]

The first of the errors was uncovered in New Mexico, where there are only three Congressional Districts. The ARRP website reported that $26,462,307 in funds would go to 10 fictional districts to "create/save" at total of 61.5 jobs.[20]

It was also reported that Lt. Governor Diane Denish spent $225,000 in federal stimulus funds to pay for a driver, a contractor to take Christmas pictures and write Christmas cards, a lawyer to make hotel reservations, opinion polling and public relations services.[21]

Accounting principles

See also: New Mexico government accounting principles

The New Mexico State Auditor is required by New Mexico law to conduct annual financial audits of all government agencies. The State Auditor’s Office administers a competitive process whereby audit firms may submit applications and proposals to perform financial audits of certain agencies. Hector Balderas was elected New Mexico State Auditor in November 2006. The Office of the New Mexico State Auditor is a constitutionally established office, allowing the State Auditor to serve two consecutive four year terms. Additionally, the Audit Act, §§ 12-6-1 to 12-6-14, NMSA 1978, provides the laws in which the State Auditor operates. Audit reports were not published online as of November 2009.[22]

The State Auditor has two statutory purposes:[23]

  • Ensure that the financial affairs of every agency is thoroughly examined and audited each year by the state auditor, personnel of the State Auditor’s Office designated by the State Auditor or independent auditors approved by the state auditor
  • Cause the financial affairs and transactions of an agency to be audited in whole or in part.

These two statutory purposes grant the State Auditor the authority to conduct both financial and special audits.

The Institute for Truth in Accounting (IFTA) rates New Mexico “worst” in filing the state’s Comprehensive Annual Financial Report (CAFR) – the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and six states as worst. IFTA does not consider New Mexico's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care. New Mexico is "worst of the 6 worst" taking an average of 602 days to issue its CAFRs for FY 2005, 2006, and 2007.[24] New Mexico's CAFRs are prepared and published online by the New Mexico Department of Finance and Administration, Financial Control Division.[25]

Anthony Armijo is State Controller and Director of New Mexico Financial Control Division, Department of Finance and Administration.[26]

Credit Rating Fitch Moody's S&P
New Mexico[27] NR Aa1 AA+

Chart on Spending FY 2001 to FY 2009

The following table provides a history for New Mexico's budgeted and actual expenditures from the General Fund.

Fiscal Year General Fund Budgeted General Fund Actual Change (%)
2000-2001 $[28] $3,543,300,000[29]
2001-2002 $[30] $3,870,430,000[29]
2002-2003 $[31] $3,895,800,000[29]
2003-2004 $[32] $4,119,800,000[29]
2004-2005 $[33] $4,406,400,000[29]
2005-2006 $[34] $4,707,400,000[29]
2006-2007 $[35] $5,115,100,000[29]
2007-2008 $[36] $6,015,000,000[29]
2008-2009 $5,719,000,000[37] $*[29]

*Actual expenditure data is not yet available for Fiscal Year 2009.

Budget transparency

See also: Evaluation of New Mexico state website

Legislation

Although New Mexico Senate Bill 159 (2009), the "Budget Transparency Act," passed the Senate, it died in committee in the spring of 2009.[38][39] It was introduced by New Mexico Senator Sander Rue.[40]

Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary Exemption Level
None n/a n/a n/a n/a n/a n/a n/a

Limitations and Suggestions for Improvements

This section could not be developed since New Mexico did not have a spending transparency database in place.

Public employee salary information

  • The Albuquerque Journal has several lists of the salaries of top state officials on their Watchdog resources page.
  • A listing of the New Mexico state payroll from 2009 is posted here.

See also

New Mexico government sector lobbying

External links

Footnotes

  1. ↑ New Mexico Legislative Finance Committee, "Fiscal Impact Report General Appropriation Act of 2009," March 19, 2009
  2. ↑ 2.0 2.1 USA Spending, "State Guesstimated* Government Spending"
  3. ↑ New Mexico Legislative Finance Committee, "Fiscal Impact Report General Appropriation Act of 2009," March 19, 2009
  4. ↑ Associated Press, "New Mexico Legislature convenes in special session Saturday to deal with $650M budget deficit," October 16, 2009 (dead link)
  5. ↑ New Mexico Independent, "Is the guv getting ready for line-item vetoes?" October 26, 2009
  6. ↑ Gov. Bill Richardson Press Release, "$153 Million in Budget Cuts Will Have Devastating Impact on Services for New Mexicans," October 27, 2009 (dead link)
  7. ↑ National Conference of State Legislatures, "Fiscal Year 2010 Budget Status," October 28, 2009
  8. ↑ New Mexico Watchdog, August 3, 2010
  9. ↑ New Mexico Watchdog, "A budget breakthrough? Committee finds NM gives away $1.3b a year in tax credits, exemptions and deductions," September 14, 2010
  10. ↑ New Mexico Legislature Website, accessed November 1, 2009
  11. ↑ National Association of Budget Officers, "Budget Processes in the States," 2008 (dead link)
  12. ↑ Stimulus Watch: Keeping an Eye on Economic Recovery Spending, "Find Projects by State or Territory," 2009
  13. ↑ Stimulus Watch: Keeping an Eye on Economic Recovery Spending, "Projects in New Mexico," 2009
  14. ↑ 14.0 14.1 "Stimulus Creates Few New Jobs in NM," New Mexico Watchdog, May 17, 2010
  15. ↑ Santa Fe Reporter, "The Stimulus Spin," April 7, 2010
  16. ↑ New Mexico Watchdog, "NM Gov. Richardson defends use of stimulus funds for wild horse sanctuary," September 22, 2010
  17. ↑ New Mexico Watchdog, "The latest on two controversial stimulus allocations: Wild horses still on hold, Film HQ renovation already OK’d," October 19, 2010
  18. ↑ Watchdog.org, "$6.4 Billion Stimulus goes to Phantom Districts," November 17, 2009
  19. ↑ Watchdog.org, "Stimulus Creates Jobs in Non-Existent Congressional Districts," November 16, 2009
  20. ↑ Watchdog.org, "Stimulus Creates Jobs in Non-Existent Congressional Districts," November 16, 2009
  21. ↑ New Mexico Watchdog, "Denish Used Federal Funds for Personal Driver, Polling and Christmas Cards," November 4, 2009
  22. ↑ New Mexico State Auditor Website, accessed November 1, 2009
  23. ↑ New Mexico State Auditor Website, accessed November 1, 2009
  24. ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  25. ↑ New Mexico Department of Finance and Administration, Financial Control Division Website, accessed November 1, 2009
  26. ↑ The National Association of State Auditors, Comptrollers and Treasurers Web site, accessed November 1, 2009
  27. ↑ State of Indiana, “State Credit Ratings," June 24, 2009"
  28. ↑ 2007 RecommendVolIII
  29. ↑ 29.0 29.1 29.2 29.3 29.4 29.5 29.6 29.7 29.8 2007 RecommendVolIII
  30. ↑ 2007 RecommendVolIII
  31. ↑ 2007 RecommendVolIII
  32. ↑ 2007 RecommendVolIII
  33. ↑ 2007 RecommendVolIII
  34. ↑ 2007 RecommendVolIII
  35. ↑ 2008 Recommend VolIII
  36. ↑ February 2009 Rev Testimony
  37. ↑ February 2009 Rev Testimony
  38. ↑ Rio Grande Foundation, "New Mexico Votes: Progress of 2009 Senate Bill 159"
  39. ↑ New Mexico Legislature, "New Mexico Senate Bill 159"
  40. ↑ State Senator Sander Rue
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