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Category: Front Page News Front Page News
Published: 12 November 2017 12 November 2017

From left are District 38 Rep. Rebecca Dow, District 39 Rep. Rodolpho "Rudy" Martinez, and District 28 Sen. Howie Morales. (Photo Coutesy of Tom Vaughan of FeVa Fotos)

By Mary Alice Murphy

On Thursday, June 29, 2017, at the Western New Mexico University Miller Library, the Grant County Democratic Party, with co-sponsors WNMU's MEChA student association and Miller Library, held a forum to hear from District 38 Rep. Rebecca Dow, District 39 Rep. Rodolpho "Rudy" Martinez and District 28 Sen. Howie Morales about the 2017 60-day legislative session and the brief special session held to fund state operations.

Serving as moderators were Grant County Assessor Raul Turrieta and Thomas Durham of the Young Democrats of Grant County.

The legislators first answered moderator questions and then a few questions from the audience.

Durham asked the first question: Is the Harper Senate Bill 412 salvageable?

 

Morales answered first, after acknowledging town councilors, county commissioners, school board members and the newest 6th Judicial District judge as being in attendance.

"We (the state of New Mexico) still have a big fiscal hole to climb out of," Morales said. "There have been various proposals. We have a $350 million shortfall to fully fund fiscal year 2018. Forty-four percent is for public schools. 412 came in as a bill. I credit Rep. Harper for his work, but in the Senate we had concerns."

He cited a bill in 2013, which gave a tax credit to big corporations lowering their tax rate from 7.4 percent to 5.9 percent. "We were told that we would receive many millions of revenue as a result, but instead the budget took a $72 million hit."

The fiscal impact report showed the positives and the negatives of SB 412. "It was impossible to score properly, so there was no saying whether it would be positive or negative. But a lot of areas were affected. Ranchers, schools, hospitals and local governments would be hit really hard."

"We need to look at pieces of the bill," Morales said. "We have to make sure we don't impact places that rely on state funding."

Dow said: "Today we are citizens of New Mexico. Thank you for the opportunity to be here." She noted that 412 had bi-partisan support during the regular session. "We need tax reform. But when it got to the Senate, hundreds of lobbyists were against it. I don't know if the bill is salvageable. In the 60-day session, there were amendments. It wasn't new when we got it in the special session, and we were continuing to work on it. But it was not appropriate for a two-day special session. The corporate tax was a sticking point on one side and the food tax a sticking point on the other side."

She noted that passing local taxes on non-food items has hit low-income families the hardest. "They were not spending taxes on food, even when there was a food tax. Now with higher taxes on the non-food items, they are spending $120 to $150 more per month. We need to broaden our tax base and lower the gross receipts tax rate."

Martinez said the monthly forums are informational and the attendance is increasing.

"Rep. Harper spent hours to try to create something," Martinez said. "It was impossible to pass in a two-day special session. Tax reform will take years. We need to bring in experts. The perception that lowering corporate tax rates would bring in more corporations didn't happen. We need to make sure legislation like this is studied. The Legislature gave them the opportunity to read the 400-plus-page bill, but it was not possible. We need to make it so counties and municipalities do not have to raise taxes to provide services. We need to broaden the base and give taxpayers the option to give input. Make it fair for everyone. It needs to provide a tax structure that will benefit taxpayers and bring in businesses."

Turrieta asked about what the topic would be for the October Special Session.

Dow looked surprised, but said: "Budget, budget, budget. I think tax reform is key. It should be talked about at interim committees now. Representatives and senators are approachable. Talk to us. We need to raise revenue and lower taxes. We need reform that removes barriers if regulations are burdensome. People who move in from other states find it hard to get licenses, without starting over. The tax reform discussion needs to be ongoing."

Martinez said the budget would be the primary responsibility of the special session. "We must balance our budget by constitution. I was not in office last October for the special session. But as a member of the appropriations committee on the first day of the regular session in January, we fixed the $70 million hole to fund the fiscal year 2017 budget. The proposal from the governor was to cut education $120 million. We didn't support that. Other proposals were to cut Medicaid and state departments. We did a solvency package to balance the budget to finish out fiscal year 2017 and then began to work on the 2018 budget."

He said judicial was also hit hard and would have run out of money in March, at which point prisoners would have had to be released, because there was no money for staff or for trials. "We proposed $100 million for judicial. The minority provided a bill that would fund the judiciary and we resolved it. We looked at revenue packages and presented on taxing sales over the Internet, and an increase in the weight tax for big trucks. We increasde the tax to $99, and the Senate reduced it to $50 excise tax. It gave the governor the opportunity to line item veto what she didn't like."

Morales said, to nervous laughter from the representatives: "There is no special session in October. But if the oil price keeps going down, we will not have the amount of money we expect. It costs $50,000 a day to go into special session, and the state doesn't have the money. We have only 1 percent in reserves. I am concerned for education, higher education and the schools. Local governments have been hit hard. We don't want to go into special session."

Durham asked about the education budget and the special session to refund higher education. What about the Land Grant Permanent Fund? Should we tap into it?

Martinez said there are pros and cons to the issue. "The proposal to increase the percentage taken out would take a constitutional amendment. If we start tapping into monies like this it will impact the future for our children. We have to be careful. There is already some money coming out of the fund. We need to continue to look at other ways to fund state services. The drop in oil prices impacts the overall budget of the state."

Morales said taking more money out of the Permanent fund has been discussed for years. "It always dies in the Finance Committee. I voted for taking more out, unless we can come up with other proposals to get us above 49th in education. We also see substance abuse issues, which cause issues in schools. We would have to come up with something that would come to the voters. The money is the way schools are built and is being used for senior centers. The argument is that taking out $1 now costs us $20 in future losses. A lot of funding is going into early education from 1 percent to 8 percent now. Forty-four percent is for K-12 and 60 percent for higher education."

"I've spent the past couple of decades in early education," Dow said. "I remember the first year. The legislators put in $200 million to make sure kids were ready for school. Now the argument is that is would take more than $400 million. There is not enough research. If you look at facts, universal pre-K is not always recommended. For those in healthy families, children are best staying in the home. But pre-kindergarten is needed for those in families with issues. Also, we do not have the workforce for universal pre-K. Even if we had the money, I don't know how far it could go."

She said she has worked with Sen. Ortiz y Pino to try to get Medicaid to pay for home visiting. "I said: 'How about a pilot program in a bill?' I have worked with the Department of Health, Human Services Department and Children, Youth and Families Department on the issue. The bill was passed and not vetoed, so maybe it will work. It would expand your First Born program here. We are hearing about Illinois going bankrupt. I'm glad we have in our constitution that we must have a balanced budget."

Dow said the Land Grant Permanent Fund dollars come from non-renewable extraction of natural resources. "If the state hadn't touched it years ago, we would now have $200 million more a year. That's about what we're short."

The next question was how the state can repair itself, if it can't increase taxes. How does it go forward?

Martinez said, especially in rural areas, the majority of the people have told him: "We need to raise taxes. We need the revenue to be able to meet the needs of the most vulnerable—our children and seniors. It seems to me unfair not to raise taxes. We have to have revenue. The state is No. 1 in the country in unemployment. We need to invest in our children and in our state. If we don't have the proper education, we can't grow. I'm a proponent of trade schools. Not everyone needs to go to college. Many youths are well versed in using their hands. The first thing a business asks when it's looking at New Mexico is: 'What is your work force?' We have engineers from New Mexico State, multiple disciplines from Western, but they usually leave the state for better opportunities. We need to raise taxes, not only for education and infrastructure and to help municipalities with their infrastructure. We're having to struggle by robbing Peter to pay Paul to fund DOH, CYFD and Corrections. It costs $36,000 a year per prisoner. It's impossible to run government without revenue."

Dow said foregoing capital outlay for a year to fund education was a good trade. "We know the governor will not sign new individual taxes, but she said she would support tax reform and general tax packages. Not everyone is for Internet taxes. For instance, seniors who can't travel to where they can buy things, can buy over the Internet and have things delivered to their door. But Internet taxes help small businesses be more competitive. I think, although I haven't personally talked to her, that the governor would support taxes on short term rentals, which bring in more revenue in New Mexico than the Marriott chain. I think an increased tax on the sale of vehicles might be OK. We can generate revenue by taxing or by creating new revenue. The state has fixed expenses, but business can export products out of state to bring more revenue to the state. We need more innovative jobs, so we see increased taxes from increased revenue."

Morales said the Senate has done a more balanced approach. "The increased gas tax was going to repair roads and bridges, which would have brought economic development and put money into our reserves. Because we have such low reserves, our bond rating will go down. That impacts everyone right there. We had no capital outlay, but the needs are still there. One area that concerned me was the veto of the hospital tax. Hospitals told me please increase the tax, because the resulting $86 million would have been matched 4:1 with federal dollars. We could have put in more for smaller hospitals. That veto was reckless. Without a hospital here, it's hard to think of what Grant County would be. The veto of the entire Higher Education agency budget has done a lot of damage. New Mexico Tech told me they have lost professors because of that veto. Every university was hit. The risk of the Spaceport hasn't proven a benefit. The risk of the corporate tax cut hasn't benefitted the state. We don't attract business by a tax cut, but by good education."

Durham asked what each legislator thought about how President Trump has done in his first 100 days.

"Outlaw tweets," were the first words out of Morales' mouth. "I am concerned around health care. The Affordable Care Act fell short. But to change it without analysis could have an impact. Health care is the only thing in New Mexico where we have growth. The continual bickering in D.C. will impact us. At the Legislature, we know we need to compromise. Washington needs to learn that."

Martinez said the Affordable Care Act was just the beginning. "It needs help. The number of New Mexicans that will be affected is huge. The emergency room is much higher cost. Those who got insurance in the 100s of thousands in New Mexico will be impacted. The new version will impact 22 million in the country. We need to look at what is most effective for Americans to make sure we have a healthy population. Cutting insurance to the sick will eliminate them. The idea of cutting Medicare and Medicaid is not favorable to the residents of the state or the country. We need to encourage our Congressional representative to provide everyone the best care."

Dow said Trump is a fine actor and she wishes he would tweet a lot less. "No one disagrees that we need health care reform. Ask people what they are paying. They face access issues and affordability issues now. The state went with one provider for medical equipment. People kept getting surprise billing. We talked about capping helicopter costs, but it's all a give and take. It's not reasonable to think that you can increase access without raising costs. Health care is growing in New Mexico, but a lot of the funding is coming from the federal government. I like the reforms that Trump did for the veterans."

Next came questions written by audience members.

[Editor's Note: The first was from an anonymous person who used his or her bully pulpit to say things that may not have forwarded the conversation. So it is not repeated here. Only the basic question.]

What legislation will you push for 100 percent renewables as soon as possible?

"We've heard tonight and other times that anything done quickly may not be done right," Dow said. "Mimi Stewart proposed a bill that would up renewables to 80 percent, but it did not pass. I don't have answers to a lot of the questions. For instance, how to store the renewables and what are the expectations of the utilities?

"The market is not driving toward renewables quickly," Dow said. "Renewables still rely on subsidies to make it affordable. And the move from traditional energy resources to renewables eliminates much of the energy work force. We can do what we can toward solar and wind. I did vote for the continuing subsidy for renewable energy for homes."

Martinez said public utilities are required to use 20 percent renewables by 2030. "New Mexico has a huge opportunity for solar and wind energy, as well as geothermal energy. Those are avenues we need to look at. A group working at the coal mine in the Four Corners region spoke recently at a local forum. These individuals are concerned that if the coal mine is closed, do we have a mechanism to replace the plants? Emissions, with technology, have been reduced a significant amount. We need more research. Where I was raised in North Hurley, we had one stack at the Hurley smelter. The emissions were so thick you could cut it with a knife. The company invested in reducing pollution, using technology. Technology will have a critical impact. Technology will save the world. We have to make sure we find the balance. Right now the oil industry price is good for consumers, but we must preserve and use our natural resources wisely and protect the environment. We need balance."

Morales said: "We need to talk about diversifying our tax base. This gives us the opportunity for new revenue. We need to get away from discussions that all oil and gas is bad, and solar and wind are good. They have heavy costs."

The last audience question asked the legislators if they would support a state single-payer health care option.

"I believe competition is good," Dow said. "We know that through real research. The single payer option passed only in the Health and Human Services Committee. Areas where we have a single source, such as the durable medical equipment provider out of Albuquerque, have cut options for my constituents in rural areas. The single source for prescriptions online is not equal. Costs, quality and accessibility are issues for single source. A single payer for New Mexico is the same thing. It implies that the state of New Mexico is able to provide the best care."

Morales said he believes that with changes to the Affordable Care Act, the country can move forward. "We have the Health Security Act in New Mexico up for consideration. It has insurance as part of the mix. It would not have the insurance company saying what prescription a person could have. The Health Security Act gets killed every year in the Judiciary Committee, because the lobbies are strong. When it's health care and prescriptions, we want to get away from a single payer. Let's look at the Health Security Act."

Martinez said the Health Security Act came before the Bayard City Council when he was mayor. "We adopted a resolution to support it. This good system could affect all New Mexicans. Insurance cannot deny a prescription. It would make sure the patient can get care."

Morales asked to add something. "This is your legislative team. We may not agree, but we always work together for you. It takes us and Candy Sweetser, representative from Deming, and John Arthur Smith, senator from Deming, to serve you."

"I agree," Martinez said. "Representative Dow and I carried a bill on providing medical equipment. It's not across the aisle; it's working together. We get it passed and cross our fingers that it is not vetoed. We will make sure we continue to work together. You are our bosses. Do not hesitate to contact us, so we understand what you need."

Dow said she appreciated the opportunity of the forum. "I'm really proud to work with Representative Martinez and really like that I could ask Senator Morales to support my bill in the Senate. We are happy to help when we can."

Martinez announced the Interim Military and Veterans Affairs Committee would meet on July 13 at the Grant County Veterans Memorial Business and Conference Center. "I was honored to be named co-chair of the committee. It is the first of several that will meet here."

After the forum, Martinez told the Beat that the Interim Water and Natural Resources Committee would be meeting in Silver City, September 5 and 6.