Updated: 11:11 am, Thu Jul 21, 2016.
A top lawmaker and the state treasurer say sagging revenues have pushed New Mexico to the financial brink and that the governor needs to convene a special session this summer to ensure the state can rebalance its checkbook and pay bills.
State Sen. John Arthur Smith, a Democrat who chairs the Senate Finance Committee, said Wednesday that the general fund, which pays for everything from prisons to health care to schools, will close out fiscal year 2016 with a shortfall of at least $150 million, and more money is needed from reserve funds to keep it solvent.
The fiscal year ended June 30, and new estimates released this week indicate the state took in just over $5.7 billion during the year, with $5.9 billion in spending.
“There’s no way to fix 2016 except with reserves,” Smith said. “It’s already behind us. You’re going to have to sweep every corner, but we believe we can cover that. It’s going to be close.”
State Treasurer Tim Eichenberg said his office does not write checks to employees, vendors and taxpayers, but it has to pay out the money when vouchers are presented. Continued deficit spending is a serious situation, he said in an email.
“The ramifications of the state treasurer’s office ceasing to honor all payments issued throughout state government is frightening,” Eichenberg said. “This situation needs to be addressed to ensure that critical functions of government are not interrupted — such as schools, police, prisons, health and human services, and payroll to state employees.”