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Legislative leader foresees gridlock

Middle ground needed

By Todd G. DicksonLas Cruces Bulletin

At the Las Cruces Day in Santa Fe breakfast Monday, Feb. 3, state Sen. John Arthur Smith of Deming talked of legislative gridlock not being limited to Washington, D.C.

The primary goal of the 30day session ending Thursday, Feb. 20, is passing a budget, but there appears to be little movement for compromise on thepublic schools portion, according to Smith.

All sides want to give the Public Education Department (PED) more money, but Democrats favor putting new money into the general funding formula while Republicans are supporting Gov. Susana Martinez’s call to fund more specifi c programs, saying that would provide greater accountability to how the new money is spent.

The two sides are so entrenched on where to put increased school funding it threatens a special session, Smith said.

“We had better find a 50-yard line,” Smith said.

The education portion of the budget has become so intense that Martinez wasn’t able to attend a reception for the Las Crucens at the Governor’s Residence later that day. Smith, who chairs the Senate Finance Committee, also is facing criticism of his fiscally conservative stances and political tactics, which were detailed in on the front page of the Santa Fe New Mexican on Sunday, Feb. 2.

Smith, in the last session, brokered an 11th hour deal that gave Martinez tax breaks to attract businesses in return for starting the process of phasing out state “hold harmless” payments to municipalities and county governments.

At the breakfast, Smith repeated his support for the tax incentives and chided officials who expressed dismay over the elimination of “hold harmless” payments – money received to make up for loss of gross receipts tax after food and medicine became exempt. Officials shouldn’t have been surprised by his action on “hold harmless” payments, he said, considering he had introduced legislation addressing the problem in four previous sessions.

The growth of “hold harmless” payments had become taxing on the state government’s budget, amounting to more than $137 million distributed to municipalities and county governments in Fiscal Year 2012. The growth in “hold harmless” just couldn’t be sustained, Smith said, and his proposal phases out the payments over a 15-year period of time.

“I just felt it better to do it sooner than later,” he said.

Smith is also being criticized for opposition to legislation that would tap into the state’s $12 billion land-grant endowment to pay for more early childhood education programs. Interest generated by investments by the fund help pay for education, Smith said, saving each New Mexico household an estimated $850 a year. The endowment, called the Land Grant Permanent Fund, grows through investments and royalties paid for use of its land, notably for oil drilling.

The problem is the fund has been tapped to support reoccurring funding to the point that if more is taken out, he said the fund could begin to see an erosion of the principal, also referred to as the fund’s “corpus.” According to the New Mexican, as much as $200 million to $300 million a year could be tapped for early childhood education programs.

Smith said he also has concerns about the expansion of early childhood education programs because private early childhood centers would not be eligible for the state money – especially from the permanent fund, making the state’s schools a competitorto these private, small businesses. New Mexico has been adding more money to early childhood education than any other state, Smith said, but he cautioned against expanding it too fast.

While Smith sees the issue as one of being fiscally responsible, he has been characterized as uncaring about early childhood education, which he said was ironic, considering his wife, Janette, is a retired early childhood educator. Smith said he had a thick skin for such criticism, but members of his family feel the sting of the criticisms.

“It’s certainly hard on our families when you’re trying to do what’s responsible,” he said. “You can’t do just what’s convenient, you have to look at the cost down the road.”

New Mexico was one of the few states able to weather the worst of the recession without laying off state workers, Smith said. The state budget, he said, continues to be challenged by low natural gas prices, which pays a higher level of royalties than oil.

Smith first won election to the state Senate in 1988, and his background is in business. He works in real-estate appraisal but previously was in sales management with the H.J. Heinz Co. in Dallas.

Legislative priorities

Las Cruces Day in Santa Fe gave local residents the opportunities to visit with lawmakers about legislation of concern, such getting $6.9 million for paving and improving the southern road to Spaceport America, which is about 45 miles north of Las Cruces.

New Mexico State University President Garrey Carruthers said his people are closely watching the progress of differentplans to shore up a solvency question for the Lottery Scholarship Fund. Students attending NMSU on the Lottery Scholarship are much more likely to graduate in six years than students attending under other kinds of financial aid.

NMSU would like to have $21.3 million put on the next statewide General Obligation Bond issue in November, Carruthers said. The Legislative Finance Committee is recommending only $19 million for NMSU’s portion of the GO Bond question.

“We need that extra $2 million built back into it,” he said.

New Mexico State University President Garrey Carruthers listens to Las Cruces Public Schools Superintendent Stan Rounds during a hearing of the Senate Education Committee Monday, Feb. 3.

Las Cruces Bulletin photos by Todd Dickson

State Sen. John Arthur Smith addresses the Las Cruces Day in Santa Fe breakfast Monday.



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