With a Wimper Not a Bang

To use an oft repeated saying, “The session ended more with a whimper than with a bang."

Wednesday was the last full day, and we spent it going into committees, then floor session, then recess for more committees. We finally left the Roundhouse at 4:30 Thursday morning. We came back around 8 AM and finished at noon as required by the constitution. We passed some bills and some memorials, but we did not pass a budget for the fiscal year which starts July 1. We Republicans held firm and refused to support any tax increases. This unity, so far, has prevented the Democrats from imposing more taxes.

By now you will have heard that we are going back into special session on Wednesday, February 24th. We will see if Governor Richardson, Lt. Governor Denish and Speaker Lujan, together with their allies, have come up with a plan to really fix spending or if they just want to “increase revenue.”

The Republicans have said repeatedly we need to reduce spending. Efforts to raise more revenue through tax increases will cause more harm than good. States like Maryland and New Jersey have experienced drops in revenue after raising taxes. Some people just do not believe that. Not all of them are in Santa Fe.

During the session I received numerous e-mails. To give you an idea of the input we get, I want to share just a few:

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No more cuts to public education and enough [sic] new revenues to fund the state budget. A balanced approach is needed. We already had $700 million dollars in cuts to the budget, now is the time to balance the budget with new revenue!

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Put the food tax back on ALL food. We handled it before and we can do it again!

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State agency employees provide the backbone of services and the economy of New Mexico, Historically, they have been underpaid in comparison to the private sector and over the last few years they have lost additional financial stability with mandated participation in union dues and work furloughs, increased PERA contributions and no pay raises, cost of living or otherwise.

Corporate combined reporting and a return to 2003 tax rates for the most wealthy are two measures that would contribute to a fairer resolution to increase state revenues that I am asking you to support. Increasing the state sales tax is also a means of fairly distributing the burden of the state's revenue shortfall.

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I am a constituent from Ruidoso and am writing to urge you to support SB 207. I am also in favor of increasing the tax burden of the wealthiest citizens of this state instead of spreading their tax burden among those of us already paying their share.

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I strongly recommend taxing the wealthy populations and big business to increase revenues instead of allowing the hardship on state employees and teachers through lay-offs and reduced salaries. The wealthy can take care of themselves; and in my opinion are in the position to shoulder the load. Their status in society requires the stronger helping the weak. They also are in position to contribute to the economy.

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As you can see, the folks who want to increase your taxes are not bashful. They reach out to the Legislature. If you do not want to see an increase in your taxes, you need to speak up. Encourage your friends to do the same.

Constituent Letter

The following "Constituent Letter" was mailed out a few days ago. I meant to post this a few days ago but things have been very busy. More on that later



Dear friends & neighbors,

We have reached the half way point of this 30 day session and I want to report how we are progressing here at your legislature. I am mailing a limited number of letters to save money. I will also post this letter on my website www.denniskintigh.com. Please let your friends and family know they can find this on the web.

I introduced one bill, HB52 to repeal the Film Production Tax Credit. This bill would have eliminated a subsidy for the movie business, a subsidy that cost you, the taxpayer, over $80 million in FY2009. Film subsidies like these have been the subject of numerous studies. Some claim the public treasury gets $1.50 back for every $1 paid out. Other studies show a return of only 15 cents. To read some of these studies, both pro and con, go to my website www.denniskintigh.com and click on the “New Mexico Film Subsidy” icon. I have read and studied all of these reports. I don’t believe you are getting a fair return for your tax dollars.

A bill that came to the Health and Government Affairs Committee was HB73 “Taking of Certain Animal Species.” This bill deals with wildlife (deer, elk, antelope, etc.) that are eating crops of farmers, dairies, or ranchers. This bill aroused a lot of attention. I was concerned the sponsor was a representative from Albuquerque with no connection to agriculture or hunting. This bill was not scheduled to be heard by the House Agriculture Committee or the committee that routinely deals with wildlife issues, the House Energy and Natural Resources Committee. The bill would stop ranchers and farmers from being able to kill animals destroying their crops if the Department of Game and Fish fails to act promptly. Instead the state would pay for fencing or damages but fails to reimburse for installation.

Many things concerned me about the bill. One was cost. An increase in hunting license fees is supposed to cover the increased costs, but if they don’t then the department would “request” grant funds from the State Board of Finance. The cost did not seem well defined. The other major problem was how this bill was prepared and submitted. As I stated above, the sponsor is from the city and no committees associated with agriculture or wildlife were scheduled to hear this. We can and should do better. Those whose livelihood are at stake need to be included in this process. I have offered to work on a compromise. Unfortunately, I expect it to take more time than we have in this session.

I have also introduced a joint resolution to propose a constitutional amendment to term limit State Representatives and State Senators. The limits I have proposed are 12 years in each body. The arguments for and against have been out there for many years and I will not repeat them here. I will just say I believe it is the right thing to do.

Tax bills are moving slowly through the house. I have not seen any I can support. We must reduce the size of government and we are not doing that.

The pace of activity will grow more frantic as we approach the final few days. I have received many letters, e-mails, and phone calls/messages. I wish I had been able to respond. I have read them all. Please continue to contact me, I value your input and ideas. The best way is via e-mail at askdennis@denniskintigh.com.

Sincerely,

Dennis J. Kintigh

The Tax Showdown in Santa Fe

Please note: In this blog you will find a number of links to actual bills, evaluations of the bills, and votes. I really encourage you to follow these links.

The Legislature has finished the second complete week of work here in Santa Fe. Friday, February 5, all of the intense private negotiations within the Democrat’s party burst out into the public. Friday was the day the house debated and voted on the budget for Fiscal Year 2011 (starting July 1, 2010) and a fistful of tax increases.

For me, the day began about an hour before the 9AM floor session, and ended when I got home at 11PM after the House Judiciary committee adjourned. Of course, we get time and a half after 5pm. (That is a joke! As you know, we are the last volunteer legislature in the nation).

Although it was not voted on until 6PM, I would like to address the budget bill first. The bill can be found here. The sponsor was the Chairman of the House Appropriation Committee, Henry “Kiki” Saavedra. I disagree with Representative Saavedra on a number of issues, but he is one of the most respected members of the House of Representatives. He is a true gentleman.

The budget bill had way too much in the way of spending in spite of the best efforts of the Republicans on the House Appropriation Committee. The Republicans have an awesome team on this committee. They are Don Bratton, Jimmie Hall, Larry Larranaga, Kathy McCoy, and Jeanette Wallace. Ultimately, all the Republicans and many Democrats voted against the budget.

During the floor debate, Representative Larranaga put forward an amendment to cut spending, but we were voted down.

Earlier in the day, we fought to stop the Democrats from raising your taxes. Each bill has an analysis done which is documented in a report called the Fiscal Impact Report (FIR). The FIR is a handy and useful summary of the bill, and is prepared by the independent and non-partisan Legislative Finance Committee (LFC). The LFC staff is an incredible collection of public servants who do their best to give accurate and unbiased information to all legislators.

The first tax increase that we voted on was to raise the State gross receipts tax (GRT) rate from 5% to 5.5% (HB 119). Local communities have an additional gross receipts tax over and above that amount. The GRT is the same as a sales tax. As a result of this tax increase, the amount you pay at the store will go up. For example, the GRT in Ruidoso will go from 8.3% to 8.8%. The fiscal impact report (FIR) for this bill can be found here. The final vote on this bill was 34 to 32. New Mexico taxpayers will be paying an additional $239.8 million.

The second tax increase was to add an income tax surcharge on higher wage earners (HB 9). The FIR can be found here. The final vote on this bill was 36 to 32. The cost for this tax increase is $66.7 million.

The third tax increase involved changing the way businesses paid taxes (HB 120). The FIR can be found here. The final vote on this bill was 42 to 25. This will cost taxpayers $15.6 million.

The last tax bill would have changed the way deductions are treated on your State income tax (HB 270). The FIR on this bill is here. The final vote on this bill was 33 to 34. This was the one tax increase we were able to stop. This would have cost taxpayers $90.2 million.

The Democrat controlled House of Representatives has voted to increase the tax burden on the working people of New Mexico by almost $400 million. I am proud to say I voted against each and every one of these tax increases as well as the budget itself.

The fight over taxes and our budget moves to the Senate. While the Senate wrestles with these issues, we in the House will tackle some social issues put forward by the Governor.

The forecast calls for more storms—political storms and snow storms.

Back in Santa Fe

Welcome to Our New Web Page

As you noticed, our web site looks different. It has been revised and updated for this current session. I hope you like it. We are excited and pleased with it.

Back in Santa Fe

I am back in Santa Fe for the 30 day session of the Legislature. The weather here has been like that back home—cold and snowy. It is quite beautiful but it can make travel difficult. Fortunately we have a place to stay that is close enough to the Capitol for me to walk.

The Budget

We are now one third of the way through the session, and I have yet to see a clear plan of how to deal with the budget problems facing our State. The majority party has had a number of private meetings (called caucuses) in which I assume they have tried to reach agreement on how their party will resolve the budget problems. I am fearful that the “solution” offered by the majority party will consist primarily of tax increases.

In a previous blog, I have provided links to web sites that give background information on how the budget process works in New Mexico. I am going to repeat those links here.

The Budget Glossary explains the terms you see in the news. A number of essays describe various parts of the New Mexico budget. The Fiscal Structure of New Mexico really gives a good overview.

To get background information on the budget process, I encourage you to visit these sites. Current information on the budget can be found here. I strongly encourage anyone interested in government spending and taxation become familiar with how state government works.

The Film Subsidy

Again this year, I introduced a bill to eliminate the New Mexico Film Subsidy. Just like last year, my bill was tabled in the first committee. Unlike last year, more and more people are starting to ask serious questions about the value of this “bail-out for Hollywood.” You may have noticed on the front page of this web site, the icon for “New Mexico Film Subsidy.” If you want to learn more about the economic realities of film subsidy programs here and in other states, please click on that icon. We have analyses both pro- and con- regarding this subsidy.

The Optimist

In spite of the fact that our State is facing grave economic problems and revenues to the State Treasury have dropped significantly, I believe there is a silver lining to this very dark cloud. Government has grown way out of control and out of proportion to the needs of the citizens of this State. Those of us in positions of responsibility are now being forced to carefully and soberly examine the size, responsibilities, and scope of government. I believe that is a good thing. We must become leaner and more efficient. There is much to be done, and I don’t wish to imply that success has been achieved. But we have begun to ask the right questions and to seek the right answers.