Limited funding, conflicting priorities likely to strain debate on state budget

Inside the Rio Chama Steakhouse on Friday morning, a conversation over breakfast between two friends with decades of history foreshadowed a looming budget fight next door at the Roundhouse.

Sen. John Arthur Smith, a Deming Democrat with a quarter-century of legislative experience and chairman of the Senate Finance Committee, turned his attention from his eggs and bacon to the man beside him, Rep. John Zimmerman, a congenial freshman Republican from Las Cruces whose wife had grown up with Smith. Zimmerman stared at his plate and shook his head in a way that signaled a defensive posture. He urged Smith not to dismiss an education proposal backed by House Republicans without considering its merits.

Smith responded, "All I'm saying is, don't send me something that costs money. We don't have it. It's as simple as that."

Moments earlier, Smith had addressed a gathering of lawmakers, journalists and lobbyists at the New Mexico Press Association's annual breakfast. He scoffed at the GOP-sponsored legislation favored by Zimmerman that proposes pay raises for certain teachers. House Republicans passed the bill earlier this week after Democrats walked out when debate was cut off. Smith said the proposal calls for more spending than the strained state budget can accommodate.

Conversations like the one between Smith and Zimmerman are about to move next door to the Capitol, where limited money and conflicting priorities -- particularly involving Republican Gov. Susana Martinez's education reform initiatives -- are sure to color the debate over the state's spending plans for the next fiscal year.

On a 15-1 vote, the House Appropriations and Finance Committee on Friday passed a lean budget, one that was dramatically pared in recent months as state revenue projections fell along with oil prices. Expected new revenue stood at $280 million in August, dropped to $140 million in December, and now stands at $83 million.

The $6.2 billion spending package proposed for the fiscal year that starts July 1 would keep spending relatively flat in most departments and programs. It includes spending more on new teachers' base salaries and pay raises for state police, child protection and economic development incentives, but not as much as what was originally proposed. Beyond that, conversations about programs that a few months ago were discussed in terms of millions of dollars in new funding grew -- or shrunk -- by tens of thousands of dollars.

For instance, the budget for court-appointed attorneys for child abuse and neglect cases would go up by $314,000. Conservation programs for the state Game and Fish Department would be cut by $500,000.

Only $1.3 million in expected revenue is unspent in the budget approved by the committee, leaving little room for adjustment when Smith's Senate committee gets the proposal. House Appropriations and Finance Committee staffer Bill Valdez described the sum as "what the bird left on the limb."

"I believe that we did as well as we could under the circumstances," said Rep. Stephanie Garcia Richard, D-Los Alamos.

Retired teacher Rep. Christine Trujillo, D-Albuquerque, cast the lone vote against the budget bill. She said it gives too much authority over spending to the state Public Education Department to carry out the governor's education reform initiatives, such as merit pay for teachers, and too little to local school districts.

"Local control has not been respected," she said.

Public education spending would consume 44 percent of the new money -- $36.6 million -- in the budget the committee passed. About $28 million would be spent at the discretion of school districts, with the rest for initiatives controlled by the Public Education Department.

Funding for Martinez's education initiatives, which Republicans overwhelmingly support and most Democrats oppose, has been a divisive issue and even temporarily stalled the progress of the budget last year.

House Appropriations and Finance Committee Chairman Rep. Larry Larrañaga, R-Albuquerque, said the House could vote on the budget as soon Monday.