Special session sparks concern among local officials
The governor signed or vetoed more than 160 bills in two days last week and announced plans for a special session
- City and county officials say the special session could determine local funding and taxes
- Among the bills the governor signed was one that reauthorized capital outlay money, which will fund improving local water infrastructure
- Martinez also vetoed a bill that would clarify confusion in gross receipts tax revenue distribution
FARMINGTON — Gov. Susana Martinez signed or vetoed more than 160 bills last week before the deadline for action, Then she said she would call a special session over budget issues.
Local leaders say they are more worried about the special session than her actions on the bills.
"There's a lot of uncertainty as to what's going to be addressed in that special session," said San Juan County Executive Officer Kim Carpenter.
Carpenter and Aztec Mayor Sally Burbridge expressed concern that local governments will have to raise taxes due to actions taken at the state level. The state has been facing significant revenue losses due to the low prices of oil and gas on the commodities market.
Burbridge said the governor has cut funding and vetoed bills that would have raised revenue for cities that also are hurting from the oil and gas slump. Carpenter said the county is already facing state funding cuts. He cited a bill signed in January that affected the state fire fund.
Aztec City Manager Joshua Ray said there are also concerns about "hold harmless" distributions to local governments intended to make up for food and drug tax exemptions..
"We are concerned with the upcoming special session and the negative impact this special session could have on our hold harmless distribution," Ray said in a text message.
Farmington City Manager Rob Mayes said Farmington also is concerned.
"We remain in limbo until the special session," he said in a text message. "However I am optimistic that the legislature and governor will find compromise on meaningful tax reform and most specifically reform that eliminates special interest exemptions."
Here are some other impacts from Martinez's actions:
Capital Outlay Reauthorization
Carpenter said one piece of good news was that the governor signed the capital outlay reauthorization bill. The county asked to have money it previously received for a wastewater system project reallocated to several water projects.
"They'll be things that are long overdue," Carpenter said.
One of the projects will help the newly formed Apple Orchard Mutual Domestic Water Consumers Association repair and replace infrastructure. Apple Orchard will serve the Harvest Gold subdivision, which has been under a boil water advisory since June.
One of the bills Martinez signed is designed to save rural New Mexico school districts thousands of dollars in transportation costs by allowing them to use sport utility vehicles instead of school buses to transport six or fewer children who live five or more miles from school.
One of the bill's sponsors, Sen. Pat Woods, R-Broadview, said in a press release that a superintendent once told him the school was required to use a bus to transport one student who lived 30 miles from the school.
There are several rural schools in San Juan County, including in the Central Consolidated School District. Cindy Theodore, CCSD's transportation station supervisor, said she will not know how the bill could affect the district until after the spring budget workshop. She said current CCSD policy is to only run routes with at least 10 students on the bus because that is the only way to make it cost effective.
Gross Receipts Tax Revenue Distributions:
Martinez vetoed a bill that Farmington, Bloomfield and several other cities hoped would clarify a disagreement between the cities' and the state taxation and revenue department's interpretation of the words "average distribution" in relation to spreading out adjustments in gross receipts tax distributions.
Gross receipts tax revenues are collected by the state taxation and revenue department and a portion is sent back on a monthly basis to the cities or counties where the transaction took place. When businesses amend tax returns or successfully protest assessments, the department may reduce the next monthly distribution. When that reduction is greater than 20 percent of the average distribution, the local government is allowed to spread out the repayment over time.
Several cities interpret this as average monthly distribution while the tax and revenue department interprets it as average annual distribution. The bill would have defined it as average monthly, which triggers the repayment at a lower amounts making it easier for the cities absorb the losses.
Germaine Chappelle, an attorney with the law firm representing several cities in a potential lawsuit over the issue, called the veto disappointing. She said the veto was surprising because the bill had received unanimous support.
"In a time when the state is struggling to find the resources it needs to maintain its most basic services, like public safety and education, and when the legislature has failed to provide the necessary resources, I cannot sign a bill that would send more money to our local governments at the expense of our general fund," Martinez stated in the message accompanying the veto.
Hannah Grover covers government for The Daily Times. She can be reached at 505-564-4652.