New Mexico’s Budget Crisis: “It’s No Laughing Matter” (RADIO SPOT)

With the prospect of a special session of the legislature fast approaching to address a looming budget crisis, the Center for Civic Policy is running this radio ad in selected areas of the state which offers our take on the issue and calls upon constituents to take action:

A thirty-second radio spot can hardly do justice to this fiscal train wreck. A bit of context is in order.

The State of New Mexico faces a serious budget deficit as the result of a shortfall in revenues. Revenue projections made back in January were overly optimistic, it seems. It now appears certain that Governor Martinez soon will call a special session of the legislature to fix a growing budget crisis.

The Governor’s answer is a 5 percent across the board cut in funding for state agencies. New revenues are off the table, she says.

To call this approach unwise would be an understatement. How about unconscionable.

Consider these facts about the quagmire in which New Mexico finds itself:

  • 49th in child poverty
  • K-12 funding is nearly 11% less per student than pre-2008 recession levels
  • 7,000 fewer children fewer children receive child care assistance than in 2010
  • Medicaid was already underfunded this year by $86 million, causing cuts of over $400 million in health care services when lost federal matching dollars are included.
  • Low- and middle-income New Mexicans pay twice the rate in state and local taxes as the richest 1 percent.

We could go on and on.

Low oil prices are cited as the cause of the crisis. But overlooked in the midst of all the hand-wringing, are the horribly irresponsible tax policies enacted in recent years.

The cold hard truth of the matter is this: The Governor is determined to protect her prized corporate tax giveaways by making New Mexico’s working families pay for them.

In 2013 Governor Martinez and the legislature gave huge tax cuts and tax breaks to large corporations, many of them out-of-state. These so-called “business incentives” were supposed to cause an explosion of job creation.

Well, it hasn’t worked. They just took the money and ran.

Today New Mexico has the 3rd highest jobless rate in the nation.

It stands to reason that our continuing underinvestment in education and healthcare is making New Mexico a less than desirable place for companies that are looking for a place to relocate.

A better answer is for legislators to say “no” to more cuts. It’s time to make corporations and the well-connected pay their fair share.

 

Health insurance reform may benefit New Mexico economically

By Matthew Reichbach

The Medicaid expansion through the health care reform law will more than pay for itself in New Mexico according to analysts from New Mexico Voices for Children. Bill Jordan, Policy Director for New Mexico Voices for Children, and Kelly O’Donnell, an economist, gave a presentation to the Revenue Stabilization and Tax Policy interim committee Friday in Albuquerque explaining how New Mexico’s tax structure lends itself to taking advantage of the Patient Protection and Affordable Care Act (PPACA).

The two were questioned by the committee on how the tax structure would help and whether or not the health care act would actually help lower income residents receive health insurance.

There are two main revenue streams from the federal government that New Mexico will benefit from according to Jordan. One is the money coming in directly from Medicaid. The other money is the money that would come in the form of tax breaks for health insurance for low-income individuals.

“Those are the two main streams of funds and ways that people will get insurance,” Jordan told Clearly New Mexico following the hearing. “Both of those, Medicaid and the private insurance that is bought on the health care exchange, are taxed already and will be taxed with a 4 percent health insurance premium tax. And that plus our gross receipts tax and other minor taxes, like personal income tax, will generate enough tax revenue that we’ll have more than enough money to pay for our share of the Medicaid expansion that’s coming.”

HSD, advocacy groups at odds over Medicaid’s future

The hearing comes after the state’s Human Services Department has said a redesign of Medicaid is necessary because it is unsustainable as it is currently run. Many more people will be eligible for Medicaid in 2014 because of the PPACA. The federal government will cover the vast majority of the costs for the first few years, though this phases out and New Mexico will be on the hook for ten percent of the costs of the new Medicaid enrollees when it is completely phased out.

This summer, HSD Cabinet Secretary Sedonie Squire rejected a call for a public Medicaid Redesign Task Force. The call came from advocacy organizations, including New Mexico Voices for Children, which were not happy about the secrecy of the Medicaid redesign.

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It’s Official: Gov. Martinez Wants Full Repeal of Federal Health Care Reform

By Charlotte Chinana

“The first step for a successful Medicaid transformation is the full repeal of the Patient Protection and Affordable Care Act.”

– An excerpt from a letter signed by 29 Republican Governors – including New Mexico’s
Susana Martinez – outlining seven principles for Medicaid Reform.

A day before the Health and Human Services Interim Committee met and heard from the NM’s Human Services Department (HSD), about their plans to redesign the state’s Medicaid program, Gov. Martinez joined several of her colleagues in signing on to a letter calling for the “full repeal” of the Federal Health Reform Act (otherwise known as the “Patient Protection and Affordable Care Act” – or PPACA).

The repeal-support letter, written as a response to a report released in March, by Senate Finance Committee Ranking Member Orrin Hatch (R-UT), and House Energy and Commerce Committee Chairman Fred Upton (R-MI), reiterates the claims made regarding costs that the states would assume, by expanding Medicaid under PPACA.

According to the Hatch-Upton report, it “conservatively estimates” that the PPACA Medicaid expansion would “cost state taxpayers at least $118.04 billion through 2023” – and provided state-by-state projections.

The report and its findings, however, were subsequently challenged by the Center on Budget and Policy Priorities, on the grounds that the report is “wholly unsound”:

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