Albuquerque Journal

Senator's Bill Cuts Rebate in Half
By Jeff Jones And Winthrop Quigley, Journal Staff Writers

SANTA FE — A state Senate leader, worried about New Mexico's revenue projections, called for a dramatically scaled-back tax rebate plan Saturday as a special legislative session called by Gov. Bill Richardson continued to crawl along at a snail's pace.
       
"This is all about economics — just how much money you have," Senate President Pro Tem Tim Jennings, D-Roswell, said of his plan to send out about $56 million worth of state rebate checks to New Mexicans strapped by high gas prices — a far cry from the $120 million rebate plan pushed by Richardson, a fellow Democrat.
       
Under the bill introduced by Jennings, a New Mexico family of four earning no more than $30,000 a year would get a $200 check in the mail. The rebates would drop for higher earners — stopping at $100 for a family earning $50,000 to $70,000 — while those earning more than that would get nothing.
       
Richardson's own bill, also pending without any floor action as of late Saturday afternoon, would give $336 to a family of four earning less than $60,000, with lower amounts for higher earners and nothing for families bringing in more than $80,000.
       
Richardson called the special session, which began on Friday, in hopes of passing a broad package that includes the rebates, a new administration to manage public employee and retiree health programs, almost $60 million in annual funding to extend health care coverage to more children and $200 million for transportation packages.
       
But as of late Saturday afternoon, only one measure — a bill to pay for the session itself — had passed both the House and Senate. And the two chambers didn't even agree on that: The House included about $35,000 in its version of the bill to pay for mailers to constituents, while the Senate voted to strip that money out of the nearly $600,000 funding package to pay for legislators' living expenses during the session and for paid staff support.
       
Meanwhile, Richardson's proposal for health care finance reform appeared to be getting little support in the Senate: Only one senator — Jennings — signed on as a sponsor, and he added the words "by request" after his signature on the bill.
       
In a later interview with the Journal, Jennings described the governor's bill as "silly."
       
He said virtually all of the 50,000 children targeted by the bill are already eligible for Medicaid and other public programs. Meanwhile, people without adequate public help suffering from mental illness and developmental disabilities "are being pushed aside," he said.
       
Jennings and Sen. John Arthur Smith, D-Deming, are also skeptical that the state has as much money to work with as projected. "To my way of thinking, those are all imaginary dollars," Smith said.
       
Revenue projections as of late last week showed there could be as much as $208 million in windfall state money available — much of it from oil and natural gas revenues — to spend on Richardson's wish list.
       
Jennings said expert consultants employed by the Legislature believe that oil and natural gas prices will be much lower than the Legislature and Department of Finance and Administration have agreed to use for budgeting purposes. If the experts are right, state revenue will be $200 million lower than the budget number, he said.
       
While the Senate adjourned for the day at 5:30 p.m. Saturday, the House stayed later and passed a few bills.
       
One was a 25 percent expansion of a personal income tax credit that will provide an average increase in benefits of $38 for families earning less than about $42,000 a year.
       
Under the legislation, the maximum credit will increase by $96 to $482 for eligible families with two or more children, by $59 to $292 for those with one child and by $9 to $44 for an eligible single taxpayer with no child.
       
The expansion will cost the state $7.6 million in reduced revenues in the current budget year. The proposal will increase the state's "working families tax credit" to an amount equal to 10 percent of the federal Earned Income Tax Credit that a taxpayer is qualified to receive. About 200,000 families receive the state's tax credit.
       
The House also approved:
       
• $7.2 million for a child care subsidy program this year, which will help expand eligibility to more New Mexicans.
       
• $1.6 million to the Secretary of State's Office to cover higher-than-anticipated costs for the upcoming general election. Paper ballots account for about 40 percent of general election costs.
       
• An extra $5 million for school bus fuel expenses this year. Richardson had requested $3.2 million but lawmakers said $5 million would not fully cover the skyrocketing costs of diesel and gasoline during the current fiscal year that runs through June 2009. School buses traveled nearly 35 million miles last year and averaged about 8 miles per gallon, according to the Public Education Department.
       
Both the House and Senate are scheduled to reconvene today.