Santa Fe, NM – Without any warning, the Republican-controlled House Ways and Means Committee today took action – with no historical precedent – to strip $80 million worth of infrastructure projects from the capital outlay bill earlier approved by bipartisan consensus in the New Mexico Senate. The House Committee’s action on Senate Bill 159 (SB 159), the Capital Outlay bill, denies funding for Senate-approved projects to repair and improve dozens of senior centers, nursing homes, public hospitals, public school buildings, public libraries, bookmobiles, museums, health centers, prisons, colleges, universities and other critical community facilities across the state. In addition to maintaining the State’s public infrastructure, the Senate bill would create thousands of needed jobs in every community in New Mexico. Instead, the House Committee redirected the funds to highway and road repairs mainly in Southeast New Mexico worth $55 million, and other uses which it is fiscally irresponsible to fund from capital outlay dollars.
“Under the difficult financial circumstances our state is experiencing, it is irresponsible to engage in this kind of creative financing,” said Senate Chairman John Arthur Smith (D-35- Dona Ana, Hidalgo, Luna & Sierra).
The Capital Outlay bill contains a total capacity of $212 million from severance tax bonds for use in Fiscal Year (FY) ’16. Severance tax bond funds in the capital outlay bill are historically used to pay for public infrastructure facilities, but not for highways and roads, which have other funding mechanisms. The State already has borrowed $1.4 billion for road and highways, and is now overstretched.
“Funding hugely expensive highway projects from capital outlay will devastate all the other critical maintenance needs of our state’s public facilities. Many of our senior centers and hospitals are crumbling. The House Republicans’ action today is fiscally irresponsible. If repairing the highways and roads is a priority for House Republicans and the Governor, we provided an alternative that does not pass the bill onto our children and grandchildren to pay. They rejected that,” said Senate Majority Leader Michael S. Sanchez (D-29-Bernalillo and Valencia).
In addition to $55 million for highway and road repairs in Southeast NM, new measures in the House Republican Committee’s capital outlay substitute includes $4 million for construction of a new Spaceport hangar, which will be adjacent to the existing unoccupied Spaceport hangar. The House also included $12 million more for the Local Economic Development Act (LEDA) ‘closing funds’. Three million of those LEDA funds will be used for expansion of the $3 million hangar construction project, bringing it to a total of $7 million. Senators strongly disagreed with including these projects in SB 159.
The State Budget Act requires the Governor to submit a capital outlay budget request to the Legislature. During this session, it was never presented with an official, or even unofficial request by the Executive. At the last minute there now are dozens of amendments included in the capital outlay bill that the Senate had never seen before, and is a violation of the Budget Act.