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Friday, November 13, 2009
Gov. Orders Unpaid Leaves
By Dan Boyd
Journal Capitol Bureau
SANTA FE — More than 19,000 state government employees will be forced to take five furlough days before July — saving New Mexico $10.8 million — under Gov. Bill Richardson's budget-balancing directive.
The governor said his response to deficit-reduction legislation passed by New Mexico lawmakers in a special session last month avoids deep cuts to Medicaid — although legislators said it wouldn't have happened under their plan — and doesn't require permanent layoffs.
Richardson, however, said he will also eliminate some state government jobs to help deal with a $650 million revenue shortfall: 84 political hires and 1,000 vacant classified positions. Specific positions weren't identified.
Public school and higher education employees, workers in the judicial branch and in agencies constitutionally separate from the Governor's Office, such as the attorney general, land commissioner and secretary of state, won't be affected by the furlough order.
Richardson's executive orders came after he vetoed the Legislature's across-the-board state agency cuts of 7.6 percent. The governor ordered what he described as responsible cuts that will vary significantly among departments and average 3.3 percent.
Other key provisions of Richardson's deficit-reduction plan include:
n Approving a legislative plan to cut public school spending for grades K-12 by 2 percent, or $51.9 million. The cut would be lessened in the short term by having the state pick up the tab for insurance on school buildings.
n Approving the Legislature's slightly deeper cut for higher education of 4 percent for base programs, or $35.4 million. The exact impact would depend on the state institution.
n Cutting back what he said were legislative-mandated reductions for Medicaid programs. He vetoed the legislation and substituted $28 million in cuts by executive order, a 1 percent reduction. No dental, vision or behavioral health programs are expected to be scrapped, and federal funding will be used to help offset the state reductions.
n Approving most of a legislative bill to raid more than 50 state funds, including a college affordability scholarship fund, to come up with nearly $110 million for government operations.
Richardson rejected some of the Legislature's plans with line-item vetoes while coming up with savings on his own through his executive orders. Overall, he said, $470 million will be saved by the end of the current fiscal year, which runs through June. The state's general fund spending, after Thursday's actions, stands at about $5.3 billion.
"I won't pretend that these actions will solve all our budget problems, but it's a start," Richardson told a Capitol news conference.
The difference between the $470 million in savings and the projected $650 million revenue shortfall for the current fiscal year might have to be addressed by spending cash reserves and making additional budget cuts when the Legislature returns in January. Legislators passed bills in the special session calling for about $525 million in savings.
While vowing to get rid of 84 employees who are exempt from the state personnel system — the
so-called political hires — Richardson vetoed the Legislature's call for him to eliminate 102 of them.
Speaking of payroll reductions overall, Richardson said, "We focused on furloughs, because I think they're more humane and they're more practical.
"We're not at a stage where we have to lay people off," said Richardson, who has consistently argued that New Mexico is better off than most states while suffering from the same national recession trends.
Union, legislators react
The governor's actions Thursday — his deadline for dealing with special session legislation — got mixed reaction from leaders of the state's largest public employees union.
Richardson's actions were also greeted skeptically by top-ranking legislators, who said more spending cuts and budget woes are likely in store for next year.
Richardson and his Cabinet secretaries had said the 7.6 percent agency cuts proposed by lawmakers would have had drastic consequences.
The union that represents 10,000 workers statewide, including 6,500 rank-and-file state employees, commended Richardson for vetoing the 7.6 percent agency cuts but expressed disappointment over the furlough plan.
"(Those employees) are really the only people in the state that are being asked to sacrifice to shore up the budget," said Josh Anderson, political coordinator for American Federation of State, County and Municipal Employees Council 18. "A week's pay is a lot of money for most people."
A plan on how to implement the furloughs will be negotiated between Richardson's chief of staff, Brian Condit, and union leaders. Exemptions may be granted if the furloughs are determined to hurt public safety and welfare.
Richardson said he would personally deduct five days' worth of pay from his paycheck and place it in the state's general fund, although he said he doesn't plan to take the corresponding time off. Five days of the governor's pay would amount to about $2,100.
"The governor was between a rock and a hard spot either way he went" said Sen. John Arthur Smith, D-Deming, the chairman of the Senate Finance Committee. "It remains to be seen whether he's done enough or not. I strongly suspect that we're going to be coming in January and putting more Band-Aids on (this year's) budget."
Richardson has said he believes tax increases will be "inevitable" during the regular legislative session that begins next January.
Even when this year's budget is balanced, Smith and other lawmakers expect the state to face a deficit of at least $400 million in the upcoming fiscal year, which starts July 1.
"Anything that's vetoed now just kicks the can down the road to January and exacerbates the problem we'll have then," said Senate Minority Whip William Payne, R-Albuquerque.
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