State budget committee recommends cutting state worker take-home pay

Jan 7, 2011

Santa Fe, NM – After numerous meetings over the past several months, the Legislative Finance Committee on Friday released its plan to balance the budget for the coming fiscal year, which begins in July.
Among the recommendations, cutting non-essential positions in state agencies like deputy directors and public information officers, eliminating vacant positions, and increasing public employees' contributions to the state retirement fund by 1.75 percent. This is on top of the 1.5 percent contribution increase put in place two years ago. Combined, the change would be an overall cut in take-home pay of just under 3 percent for the average state worker.
The LFC plan increases spending on K through 12 education by 37 million dollars to make up for federal stimulus funds which are no longer coming in higher education would be cut by 29 million. At the same time, the LFC plan would increase Medicaid spending by 42 percent, 253 million dollars, to cover lost federal funds and match a rising need for medical, mental health and substance abuse services. But the LFC says it expects the state Human Services Department to reduce provider rates and find places to be more efficient with the Medicaid program.
Other points in the proposal include a 4 percent cut to the Corrections, and a 2-point-4 percent cut to Public Safety. Overall, the LFC's spending recommendations for Fiscal Year 2012 total around 5.4 billion dollars, up 3.6 percent from last year's adjusted budget. The committee says that reflects growth in gross receipts and corporate income taxes in New Mexico.
Following the plan's release, Governor Susana Martinez praised the L-F-C for not proposing a tax increase. She added that her budget proposal will take a different approach to cuts and reducing the size of government, but she looks forward to crafting a bi-partisan balanced budget with lawmakers.