Senator Ingle opened the talks by highlighting the influx of new faces and money in the capital as a result of our most recent elections, and expanded on how that has changed the political atmosphere. He also touched on Senate Bill 489, the Energy Transition Act, and why New Mexico’s rich oil and gas industry still has a bright future in the state. “You’re going to have oil and gas for years, folks” said the Senator while he noted that legislation like the “anti-fracking” bill would never leave committee. Senator Ingle’s evaluation of The Energy Transition act was grounded in the real world as he explained that much of the solar energy New Mexico is producing currently is being whisked away to other states like Arizona and Colorado. This is because, while we do have excellent solar and wind production capabilities, New Mexico is hampered by a lack of suitable transmission lines to adequately move that energy to where it can meet demand. Senator Smith also noted that while he isn’t opposed to renewable energy initiatives, “they just don’t have the same rate of production right now that New Mexican oil and gas does,” and that without government subsidy, wind and solar is a hard sell.
Senator Smith, who is also the chair of the Senate Finance Committee, took the opportunity to highlight some positive outcomes from the session. He also applauded the bi-partisan work that went into passing the state’s new minimum wage increase. While it may not be the ideal solution for everyone involved, Senator Smith was optimistic about the rate of increase, saying that by increasing wages incrementally, it would help ease the burden for employers, giving everyone time to adjust and make course corrections.
NMBC does not support government mandated wages. Carla Sonntag, president, shared a few cases in point where the free market system worked well such as Target and Wal-Mart increasing their minimum starting wage. But, she noted that if the legislature were going to increase the minimum wage, she was glad to see the hard work of the Senate on the final bill that was passed and signed into law.
There was an interesting discussion on taxes. In spite of a billion dollar budget surplus, there was a significant push to increase taxes. Senator Smith discussed HB 6 Tax Changes sent to the Senate from the House. It originally would have been about a $450 million tax increase, but the Senate trimmed it back to about a $70 million increase. Most of that increase was related to: 1) new internet sales tax bill that will help give local business owners some of the help they need in competing with massive online retailers like Amazon; and 2) GRT taxes for nonprofit hospitals, like Presbyterian.
Senator Smith said, “What should have happened? This was the year to come up with legitimate tax reform because we had the money. But we did not have the perseverance to do it, even though we had $1.1 Billion of new money.“
According to Senator Smith the income tax increases (that passed and was signed by the Governor) would impact single filers beginning at $210,000 and joint filers at $315,000. He said the income tax increases will not go into effect if state revenue for next fiscal year exceeds this year’s revenue by more than 5 percent. He added that a lump sum payment from the federal government this year of $380 million (from O & G lease revenue) will make it harder next year to beat this year’s revenue meaning taxes on the higher income earners is most likely going to be a reality.
The BASH event was a resounding success and a chance to see NMBC in action with some of the elected officials and businesses who follow and support our mission. If you would like to support a better business environment for all New Mexicans, you can join our team HERE and become a member today!