KUNM

New Mexicans Wary Of Both Budget Cuts And Tax Increases

Feb 2, 2017

State lawmakers in Santa Fe are wrestling with a fiscal crisis. And the debate is familiar: cut spending or raise taxes in order to balance the budget. How would voters solve this problem?

On a cold but sunny Saturday morning I headed a hundred miles south of Santa Fe, to Belen, for the annual World’s Largest Matanza. This festive pig roast is a celebration of Hispanic heritage that draws thousands of people for crispy chicharrones, fiery red chile and fresh tortillas.

Sam Perez is a truck driver and said he feels a personal stake in the future and how the state spends its money, whether it’s on health care, employee pensions—or schools.

I mean, how far down is New Mexico in the nation as far as education,” Perez says. “I have a six-year-old. I don’t want her education to suffer from cuts.”

The state has trimmed funding for education, but a recent poll, paid for by the New Mexico Center on Law and Poverty, showed the overwhelming majority of New Mexicans—Democrats and Republicans—don’t want any more cuts to schools.

Senate Republican leader Stuart Ingle is one of many lawmakers who finds himself in a tough spot.

The decisions to cut spending are always very difficult,” Ingle said. “For one thing the biggest part of our budget either has to do with public education or higher education.”

Coming up with more money can be equally problematic. Governor Martinez has stood firm on a no-tax pledge since she was elected in 2010. But oil and gas revenues, which make up a third of the state’s budget, have sagged in recent years. And now Ingle is under pressure to find more revenue.

It’s always very difficult to increases taxes, because we’re basically taking money from folks that are trying to pay their bills, raise their children, pay off their cars and things like that. And all of us are affected by tax increases one way or the other,” he says.

But the dilemma is not so cut and dry according to Carter Bundy, the head of a public employees’ union.

You don’t have to choose between cuts and raising taxes,” he says. “The first thing you do is you close the loopholes. The second thing you do is you adjust some of our flat taxes—things like gasoline, alcohol, cigarettes, they have not been adjusted for years—making sure you don’t lose value due to inflation.”

In the crowded Sheriff’s Posse beer garden at the Belen matanza, several people say yeah, they’d be ok if the state took a bigger cut from sales of booze and cigarettes. So-called sin taxes are a pretty popular solution. Two thirds of New Mexicans support the idea.

But some voters, like Twyla McComb, are wary.

“Gas tax, cigarette tax, alcohol tax, I think those have already been taxed to death,” she said.  

There are no easy answers though and McComb says the government should be careful of cutting too much.

I suppose there’s some fat in the administrative stuff, but I hate to say that because right now, that is our industry, so I’m not so sure that cutting out more state jobs is going to help us either, because where are those people gonna work?” she asked.

One popular money-making idea is legalizing recreational cannabis—and taxing it. But Rose Hare, who came from Santa Fe to volunteer at the matanza, says she worries about unintended consequences.

We already have a problem with drunk driving so I don’t think driving buzzed is going to solve anything,” Hare said.

She said she’s just resigned to paying higher taxes.

Well, I don’t think I really have a choice about it,” Hare said. “If I want the teachers to be paid, if I want the budget to be met, then I’m going to have to pay taxes, whether I like it or not. And I don’t like it, but that’s the only simple way to get money."

Recently, the Greater Albuquerque Chamber of Commerce has shifted its stance and indicated it might not fight some tax increases. But finding a combination that the Legislature and governor agree on will be tough.

Stuart Ingle has served for more than 30 years in the state Senate, and has weathered many cycles of boom and bust.

“We’re here to represent the people that send us,” Ingle said. “And we are in very close touch with them. We all shop at the same grocery stores, filling stations, clothing places and when you see people and they disagree with you, they generally let you know!”

No matter what state lawmakers decide, they’ll probably get an earful about it.

***

The People, Power and Democracy project examines ethics, transparency and accountability in state government. The project is funded by the Thornburg Foundation and by contributions from KUNM listeners.