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Last night HB8: Appropriation for Economic Development Training (JTIP) Speaker Lujan passed Senate Finance and now heads to the Senate Floor for approval.  This bill appropriates $5.0 million from the General Fund to the Development Training Fund for providing in-plant and classroom training.

The House Tax and Revenue Committee tabled two important bills:

SB112:  SEVERANCE TAX AND OTHER CAPITAL PROJECT BONDS Sen. C. Cisneros contains Capital Outlay dollars for much-needed economic development projects.

SB182: VOIDING AND REAUTHORIZING CAPITAL PROJECT EXPENDITURES also sponsored by Sen. C. Cisneros was tabled.  This bill known as the Severance Tax claw back is vital to balance the current year budget.  Without this bill, the state only has money for about 30 days, then will have to cut back to essential services mode only.

Also, still waiting to be heard on the Senate Floor is:

HB144: UNEMPLOYMENT COMPENSATION INCREASE sponsored by Rep. M. Stewart. This bill raises the unemployment compensation contribution by employers having a positive balance in their reserve account of at least one percent. The contribution increases by two-tenths percent of payroll for the period July 1, 2010 through December 31, 2011. The bottom line is that if nothing is done the Department of Workforce Solutions would be forced to take out a loan from the US Department of Labor.  As soon as that happens, and as repayment begins, the statutorily defined ratios vis-à-vis fund balance would dictate that we would move immediately from UI tax schedule 0 to schedule 6. (from $156 average contribution per employee to $528).  Needless to say, this would be a disaster for New Mexico businesses of all sizes. If the total fund amount is equal to three-tenths percent of the total payrolls in the state at any given time, the Secretary must implement schedule 6.  House Bill 144 does seem to be a good way to address the crises by spreading out the impact over time and avoiding crisis mode.  ACI will continue to support this bill.

HB237: GOVERNMENT RESTRUCTURING TASK FORCE sponsored by Rep. L. Varela creates a 17-member Government Restructuring Task Force to study the resources of the state’s agencies’ programs, services, funding and polices, and the public need served by them; and also seeks to examine the laws, constitutional provisions, rules and court decisions governing state government and reorganization. The task force must meet at the call of the chair at least one time per month beginning no later than April 22, 2010. The task force must make a report of its findings and recommendations by December 1, 2010 to the Governor and Legislature, and must make presentations to the Legislative Council, the LFC and the LESC. A final report and proposed legislation must be made available to the Governor and legislators by December 31, 2010. ACI supports this bill.

As the session draws to a close, the House has still not heard or concurred with the Senate version of HB2 (the budget).  The House version only contained 1% in cuts and significant tax increases, whereas the Senate met halfway, with $153 million in cuts, and $153 million in increased taxes.  It would appear that New Mexico is heading for yet another special session, especially since the Governor has indicated that he supports the House version of the budget.

Today, on the Senate Floor, HB144: UNEMPLOYMENT COMPENSATION INCREASE, sponsored by Rep. M. Stewart, will be heard. This bill raises the unemployment compensation contribution by employers having a positive balance in their reserve account of at least one percent. The contribution increases by two-tenths percent of payroll for the period July 1, 2010 through December 31, 2011. The bottom line is that if nothing is done the Department of Workforce Solutions would be forced to take out a loan from the US Department of Labor.  As soon as that happens, and as repayment begins, the statutorily defined ratios vis-à-vis fund balance would dictate that we would move immediately from UI tax schedule 0 to schedule 6. (from $156 average contribution per employee to $528).  Needless to say, this would be a disaster for New Mexico businesses of all sizes. If the total fund amount is equal to three-tenths percent of the total payrolls in the state at any given time, the Secretary must implement schedule 6.  House Bill 144 does seem to be a good way to address the crises by spreading out the impact over time and avoiding crisis mode.  ACI will continue to support this bill.

Also on the schedule is HB237: GOVERNMENT RESTRUCTURING TASK FORCE sponsored by Rep. L. Varela creates a 17-member Government Restructuring Task Force to study the resources of the state’s agencies’ programs, services, funding and polices, and the public need served by them; and also seeks to examine the laws, constitutional provisions, rules and court decisions governing state government and reorganization. The task force must meet at the call of the chair at least one time per month beginning no later than April 22, 2010. The task force must make a report of its findings and recommendations by December 1, 2010 to the Governor and Legislature, and must make presentations to the Legislative Council, the LFC and the LESC. A final report and proposed legislation must be made available to the Governor and legislators by December 31, 2010. ACI supports this bill.

Yesterday, the Senate Corporations and Transportation Committee tabled HB180: WORKER ADJUSTMENT RETRAINING AND NOTIFICATION ACT sponsored by Rep. Mimi & Speaker Lujan will be heard today in the House Judiciary Committee.  This bill, if passed, will drastically expand the current federal WARN Act. (This is the federal law that requires employers to provide notice of a mass layoff or shutdown of operations).  This legislation would have increased the regulatory burden for employers across the state. ACI opposed this bill.

Not yet scheduled for a hearing in Senate Finance is HB8: Appropriation for Economic Development Training (JTIP) sponsored by Speaker Lujan.  This bill appropriates $5.0 million from the General Fund to the Development Training Fund for providing in-plant and classroom training. This is an important bill for economic development in the state.

HB259:  PRIVATE ACTIONS FOR LACK OF ENVIRONMENTAL ENFORCEMENT sponsored by Speaker B. Lujan did not pass the floor on an 32-34 vote.  This bill would authorize a person whose interests may be adversely affected and who has provided the 60-day notice to intervene in the administrative or court enforcement action brought by an agency.  Under current law, there is no authorization for such intervention.  This could substantially increase the cost of litigation with the agencies and make possible settlement more difficult.  Interveners will have the right to approve or object to any settlement reached with the agencies.

The Senate Corporations and Transportation Committee passed HB8: Appropriation for Economic Development Training (JTIP) sponsored by Speaker Lujan.  This bill appropriates $5.0 million from the General Fund to the Development Training Fund for providing in-plant and classroom training.

That committee tabled lots of tax increases this weekend as well, including:

HB9: ONE PERCENT INCOME TAX SURTAX introduced by Rep. E. Sandoval a one and one-half (1.5%) percent personal income tax surtax on married individuals filing separate returns with income over $100,000, on heads of household, surviving spouses and married individuals filing joint returns with income over $200,000 and on single individuals and estates with income over $133,000 for the 2010, 2011 and 2012 tax years.

SB65: RAISES PERSONAL INCOME TAX RATES introduced by Sen. G. Ortiz y Pino that would raise, beginning with the 2010 tax year, personal income tax rates by adding five new brackets.

SB90: Mandatory Combined Tax Returns introduced by Sen. P. Wirth requires almost all corporations operating in New Mexico that are members of a family of corporations engaging in a unitary business to file a combined return for New Mexico corporate income tax purposes.

SB122: SURTAX ON HIGH-INCOME NEW MEXICO TAXPAYERS introduced by Sen. B. Sanchez would impose a surtax of one percent on taxable income in excess of $80,000 for married individuals filing separate returns; $160,000 for heads of household, surviving spouses and married individuals filing joint returns; or $100,000 for single individuals and for estates and trusts.

SB128: PERSONAL INCOME TAX SURTAX, DISTRIBUTION CHANGES Sen. E. Griego would, for the 2010, 2011 and 2012 tax years, adds a 3.3 percent personal income tax surtax on married individuals filing separate returns with income over $75,000, on heads of household, surviving spouses and married individuals filing joint returns with income over $150,000 and on single individuals and estates with income over $100,000.

SB142: LIQUOR TAX BOOST FOR TREATMENT FUND introduced by Sen. B. Sanchez would increase liquor excise tax rates, as follows: on spirituous liquors, from $1.60 to $2.73 per liter; on beer (except that produced by microbreweries) from $0.41 to $0.94 per gallon; on beer produced by microbreweries, from $0.08 to $0.61 per gallon; on fortified wine, from $1.50 to $1.92 per liter; and on cider, from $0.41 to $0.94 per gallon.  This tax would only impact the private sector businesses.

SB210: PERMANENT TAX INCREASE ON HIGH INCOME PEOPLE sponsored by Sen. L. Lopez adds a new, permanent personal income tax bracket imposing a rate of 5.9 percent, starting with taxable incomes over $100,000 for married persons filing jointly, heads of household and surviving spouses and at $50,000 for single individuals and estates and trusts.

Today on the House Floor, the following bills will be heard:

HB180: WORKER ADJUSTMENT RETRAINING AND NOTIFICATION ACT Speaker Lujan.  The Worker Adjustment Retraining and Notification Act requires certain employers to provide advance notice at least 90 days before a mass layoff, a worksite closing or a sale or transfer of operation. Applies to employers of 75 or more full- and part-time employees and includes the parent corporation of a subsidiary that directly owns and operates a business. The bill authorizes the attorney general to pursue complaints. The bill states that notice must be given to each employee, representative of the employee, appropriate local Workforce Investment Boards established pursuant to the federal Workforce Investment Act of 1998 and the chief elected official of the unit of local government where the mass layoff, worksite closing or transfer of operations will occur. Employees who voluntarily leave the company during the notice period in anticipation of losing their job are counted toward all minimum numerical thresholds. This law will drastically expand the federal WARN act. ACI will oppose this bill.

Also, still on the Calendar waiting for enough votes to pass is the reconsideration of HB270: TAXES ON TAXES sponsored by Rep. M. Stewart.  This bill requires personal income taxpayers who itemize their deductions to reduce the amount of itemized deductions for New Mexico purposes by the amount of state and local taxes included in the itemized deductions for federal purposes.  ACI will continue to oppose this bill.

On the Senate Floor, the following bills are scheduled to be heard:

SB207: PUBLIC EMPLOYEES RETURNING TO WORK sponsored by Sen. D. Ulibarri.  This bill, also known as the Double Dipper bill, suspends upon commencement of employment the pensions of PERA retirees (other than elected officials, chiefs of police or undersheriffs) who return to work. Pensions resume at the suspended rate upon termination of re-employment. ACI supports this bill.

SJM7: MODEL STATE ADMINISTRATIVE PROCEDURE ACT introduced by Sen. T. Keller creates a task force to consider use of part or all of the proposed Model State Administrative Procedure Act for rulemaking and adjudicatory proceedings by state agencies. The task force will consist of 19 members comprised of legislators, cabinet secretaries and representatives of various legal organizations and regulatory bodies. New Mexico is the only state in the nation that does not require agencies to follow the Administrative Procedures Act when creating rules and regulations.  ACI supports this Resolution.

Today the Senate Corporations and Transportation Committee will hear:

HB8: Appropriation for Economic Development Training (JTIP) sponsored by Speaker Lujan.  This bill appropriates $5.0 million from the General Fund to the Development Training Fund for providing in-plant and classroom training.  ACI supports this bill.

The Senate Education Committee will hear SJM24: PUBLIC SCHOOL FINANCE POLICIES AND PRACTICES sponsored by Sen. C. Nava requests the Office of Educational Accountability, in collaboration with the Office of the State Auditor and the Public Education Department to convene a work group to examine the public school district finance systems and operations; its statutory powers and legal concepts; the ability of school districts and state agencies to oversee school district finance systems; and the training of governing bodies and school finance personnel concerning the systemic safeguards against fraud, waste, abuse. ACI supports this Memorial.

The Senate Finance Committee will hear:

SB160: TAX LIGHTNING FIX introduced by Sen. S. Neville changes the basis for valuing residential properties for property taxation purposes from a “current and correct” (i.e., market) basis to a cost basis. For 2012 and subsequent property tax years, any increase in valuation may not exceed five (up from three) percent but only in counties with a sales ratio of 95 or higher. The increase limitation will apply to residential properties which changed hands in the prior year. The cost method calculates the residence’s valuation by subtracting from the residence’s cost a measure of depreciation and adding the result to the property’s land value. ACI supports this bill.

SB180: GENERAL TAX AMNESTY sponsored by Sen. P. Griego authorizes the Secretary of Taxation and Revenue, with the concurrence of the Governor, to declare a tax amnesty period of up to 90 days in FY 2011. Only taxes administered by the Taxation and Revenue Department can be covered. Excludes taxpayers to whom the department issues a notice of the commencement of an audit before the taxpayer asks for amnesty. The amnesty covers almost every tax administered by the department, including state and local gross receipts taxes, compensating tax, personal income tax, corporate income tax, liquor, cigarette, boat and other excise taxes, taxes on mineral production, gasoline, weight distance and other transportation taxes and workers compensation fee. Property tax, copper ad valorem tax and trip tax are excluded. The bill also appropriates $0.5 million to the Taxation and Revenue Department to run the amnesty program. ACI supports this bill.

The House Judiciary Committee will hear HB259: PRIVATE ACTIONS FOR LACK OF ENVIRONMENTAL ENFORCEMENT sponsored by Speaker B. Lujan.  This bill amends the Oil and Gas Act, the Environmental Improvement Act and the Water Quality Act to provide for a private right of action (“citizen suit”) to enforce those Acts. The private right of action extends not only to enforcement against the individuals and companies subject to those Acts, but also to enforcement against the state of New Mexico and the relevant agencies, divisions, boards and commissions that administer those Acts. A person who has an interest that is or may be adversely affected may bring a civil action on that person’s own behalf against any other person, including the state of New Mexico, a political subdivision thereof or any officer or agency of either, for a violation of the Act, or a rule, permit or order issued pursuant to the Act. A person who has an interest that is or may be adversely affected may also bring a civil action against the relevant agency, division, board or commission alleging a failure to perform any nondiscretionary act or duty required by the Act or a rule promulgated pursuant to that Act. ACI stands in strong opposition to this bill.