I write a good amount about the oil and gas industry within New Mexico and the reason I do so is because I lived in a heavy oil and gas producing community for the first 19 years of my life.

As I’ve mentioned before,  my friends and family are still among the people who are directly affected by this industry, whether it be their source of an occupation or the source of contamination near them.

I appreciate the revenues that the oil and gas industry has brought into this state and into some of my acquaintances pocketbooks via a paycheck.  What I don’t appreciate is the way the industry has always acted with a heavy hand when they do business in our state and some of their “My way or the Highway” attitudes.

Many have seen this as of late as some from the oil and gas industry, and from the New Mexico Oil and Gas Association in particular, has responded negatively to the regulations of oil waste pits in the state of New Mexico.

While the Pit Rules regulation aims at curbing the instances of groundwater and land contamination from the activities of oil drilling, many have come out saying it’s a direct attack on the oil and gas industry and that it will doom our state’s economy.

Yet, no where in their argument do they say that the pit regulations will help put an end to the already hundreds of documented cases of water contamination in our state from oil and gas activities. They do even less justice to the fact that this regulation will end up protecting the health of a very large number of people who live in our state.

I found it irresponsible to argue about the economics of the bill and disregard the beneficial health implications of it. Thus, I was surprised to see a recent article detailing how the New Mexico Oil and Gas Association will be looking to engage more with the public in regards to their activities and take a more balanced approach.

The article was entitled, “Oil, Gas Group Retools Approach” and can be seen in today’s Albuquerque Journal Business Outlook section.  An excerpt from the article towards their unchanging goals and focus:

NMOGA’s board chairman, S. Leland Gould, an executive with Giant Industries, said no one person is at fault, but the association does need to improve its effectiveness and to find a way to balance the legitimate concerns of regulators, citizens and the industry.

“The focus of the organization and our mission and goals remain unchanged, and our support for them is unwavering,” said Jason Sandel, a member of NMOGA’s executive committee and executive vice president of Aztec Well Servicing.

“We believe very strongly we don’t want to change direction,” Gould said. “There have not been changes other than that we are now evaluating how to be more balanced and more effective.”

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As the New Mexico State Legislature enters its third week, the battles rage on about how to resolve the state’s yawning budget gap.

Slash services even more, say the cut-only crowd. Raise revenues by closing tax loopholes for out of state corporations and make the wealthy pay their fair share, say those advocating a balanced approach.

Last week I caught a glimpse of what might happen in New Mexico if those who favor drastic cuts get their way.

This Feb. 5. Denver Post story, “Colorado Springs Cuts Into Services Considered Basic By Many,” details the catastrophic changes taking place there after voters rejected a tripling of property taxes that would have raised $27.6 million for the city’s $212 million general fund budget.

According to the Post story, many residents said they didn’t trust city government to wisely spend a general tax increase and didn’t believe the current cuts are the only way to balance a budget.

From the story, here’s a litany of what’s going to happen in Colorado Springs as a result, starting today:

More than a third of the streetlights in Colorado Springs will go dark Monday. The police helicopters are for sale on the Internet. The city is dumping firefighting jobs, a vice team, burglary investigators, beat cops — dozens of police and fire positions will go unfilled.

The parks department removed trash cans last week, replacing them with signs urging users to pack out their own litter.

Neighbors are encouraged to bring their own lawn mowers to local green spaces, because parks workers will mow them only once every two weeks. If that.

Water cutbacks mean most parks will be dead, brown turf by July; the flower and fertilizer budget is zero.

City recreation centers, indoor and outdoor pools, and a handful of museums will close for good March 31 unless they find private funding to stay open. Buses no longer run on evenings and weekends. The city won’t pay for any street paving, relying instead on a regional authority that can meet only about 10 percent of the need.

“I guess we’re going to find out what the tolerance level is for people,” said businessman Chuck Fowler, who is helping lead a private task force brainstorming for city budget fixes. “It’s a new day.”

Does that sound like a nightmare to you? It does to me. Public safety, roads and transportation, healthcare, recreation…all the things governments provide – things that Tea Partiers, I guess, fail to acknowledge – just gone out the window. Let the private sector take care of it, I guess.

State budget responsibilities are different than municipal ones, but the impact of such drastic cuts on state-provided public safety, education and healthcare would be equally catastrophic.

No one knows yet what’s going to happen at our state legislature, but the message so far isn’t pretty. On Friday, HB 270 (also called the PIT add-back bill) sponsored by Rep. Mimi Stewart died by one vote Friday on the House floor. The measure would have stopped New Mexicans taxpayers who itemize from being able to deduct their state and local taxes on both federal and state forms. The bill could have generated $65 million annually for the state.

A number of other tax bills that could generate millions of dollars for the state await a full hearing, including HB 62/SB 90, a combined reporting bill sponsored by Sen. Peter Wirth and Rep. Ed Begaye that would require out-of-state corporations to pay taxes on income made in New Mexico, which is still making its way through House committees; and HB9, a measure sponsored by Rep. Ed Sandoval that would impose a surtax on New Mexico’s highest earners, which just passed on the House floor.

What happens to those bills in the ever-tightening debate at the session will dictate whether New Mexicans will keep vital services intact – or soon start suffering Colorado Springs-type cuts.

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Here’s a quick update on the Same Day Registration bill that was heard Thursday in the House Consumer and Public Affairs Committee.

The bill would extend the registration period directly before the election, ensuring greater access to the polls for working families, students and others who have traditionally found registration a barrier to voting.

Because of scheduling conflict, the hearing was delayed for several hours beyond its original time of 1:30 p.m. The measure was approved by a vote of 4 to 3 after speakers from a number of groups spoke in favor of or against.

Despite a huge build-up from the state Republican Party and those associated with the Tea Party movement, who said the reform would lead to fraud, only a handful of non-lobbyists showed up to oppose the bill.

Those who spoke in favor included representatives from the good government group Common Cause, The League of Women Voters, the Association of Graduate and Professional Students at the University of New Mexico. Check out a liveblog of the debate from the New Mexico Independent here.

The bill now heads to the House Voters and Elections Committee.

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Is Same Day Registration a way to increase access to the polls for rightful would-be voters? Or is it a nefarious plot to somehow promote massive voter fraud by pressuring illegal immigrants to vote?

Unbelievably, the Republican Party of New Mexico would have you believe the latter.

In a letter distributed on Jan. 25, Republican Party chairman Harvey Yates Jr. exhorted party faithful to rise up against HB 123, a bill which would allow people to register to vote and vote in the same day during the period when early voting is permitted.  It will be heard today at 1:30 in the House Consumer and Public Affairs Committee.  (Last minute scheduling changes may affect this time.)

In the letter, Yates called Same Day Registration “a license to steal elections.”

Here’s more:

There are few things more threatening to our liberty than voter fraud. There are those in this state who claim there is no voter fraud. That is pernicious nonsense! They allow their desire to win elections at any price to overcome what they know to be the truth of the matter.

Last election, a woman in emotional distress walked into a polling place in Dona Ana County. Asked what was wrong, she, in Spanish (she spoke no English), explained that young men had come several times to her home to get her to go vote, and finally had threatened her with a visit from the Sheriff if she failed to vote. She thought she had no right to vote even though she had been issued a voter ID card by former Secretary of State Rebecca Vigil-Giron. Why did she think she had no right to vote? She is a legal immigrant; she has a green card. Her distress likely was caused because she knew if she committed the crime of illegally voting, that might diminish her chance of becoming a citizen of this country.

This year a bill for same-day voting has been introduced in the legislature, click here to read it. While the example I give above of voter fraud might not have been affected by same-day voting, the example, nonetheless, gives evidence to the claim that our voter system has been permeated with fraud. Why was this woman issued a voter ID card by the Secretary of State? Who were those young men who came to her house? How many other legal aliens, or for that matter illegal aliens, are pressured to vote?

Over the past 10 days, this letter and related disinformation campaigns conducted through right-wing talk radio have whipped up rapid opposition to the bill. Much of the vitriol, expressed through calls, emails and letters, has been directed at Dem. Rep. Gail Chasey, who chairs the committee that will hear the bill. According to some accounts, Chasey felt threatened by at least one call and notified security. Expect an interesting scene today in the small committee room where the bill will be discussed!

Would you appreciate a fact-based, non-partisan explanation of what the Same Day Registration Bill would do, from some people who actually know?

Let me refer you to this guest editorial from Lea County Clerk Pat Chappelle and Bernalillo Country Clerk Maggie Toulouse Oliver (subscription required), which appeared in the Albuquerque Journal on Jan. 31. The authors, one of whom is a Republican (Chappelle) and one who is a Democrat (Toulouse Oliver) note that this particular form of election reform is “not a partisan issue.”

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Frances Perkins

This week marked the halfway point of a legislative session dominated by a budget crisis of historic proportions – a massive collapse in revenues brought on by the 2008-09 national recession.

Last week it was reported that the state’s unemployment rate hit a 22 year high of 8.3%. Although less than the national unemployment rate of 10%, it’s still devastating to New Mexico families. Yet the persistence of widespread suffering doesn’t seem to have restrained some of our lawmakers from indulging in occasional moments of public inanity — not to mention insanity.

But more on that later. First, let’s consider unemployment — and specifically, unemployment insurance claims, which have soared due to the Great Recession.

Yes, unemployment insurance – it’s one of those not-so-little New Deal era reforms that has done so much to cushion the impact of job losses for millions of Americans, as well as lessen the severity of economic downturns. (Now you know why this post features a picture of Frances Perkins, America’s first woman cabinet member and FDR’s Labor Secretary who was the driving force in creating the vital safety net of unemployment insurance.)

The key objective of an economic stimulus is to expand demand for goods and services. And as an economic stabilizer, unemployment insurance is a particularly effective stimulus. Lost jobs mean declining consumption – which can set off an economic death spiral of further reduction in the demand for other goods and services, deepening into a negative cycle of increasing unemployment and declining economic activity. Unemployment insurance helps break this negative cycle by partially compensating for lost income, and thus lessening the overall reduction in spending.

The unemployment insurance program keeps families – and the economy – from sinking even further and speeds up eventual recovery.

But somebody forgot to explain all of this to New Mexico State Representative Candy Spence Ezzell (R-Roswell).

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Corrales Democratic Rep. Ben Rodefer says he’s “ashamed” of the New Mexico state Senate Public Affairs Committee’s action yesterday on the domestic partnership bill.

On his Twitter account, Rodefer wrote:

“The founding of this Country was predicated on equality, equality for everyone, no exceptions. I’m ashamed of the NM Senate’s actions today.”

I’d say “ashamed” is a fair way to react to how the committee heard hours of testimony on the bill, then referred it to three committees, essentially dooming it to fail during the short, 30-day session.

The bill, sponsored by Democratic Sen. Peter Wirth of Santa Fe, would give same-sex couples the same rights given to straight ones, without actually calling their unions “marriage.”

Dumbfounded is the word that occurred to me as I watched the debate unfold and heard New Mexico legislators who opposed the bill try to explain why they would vote against it.

I was particularly struck by the comments of Carlsbad Republican Sen. Vernon Asbill, who seemed not to understand that discrimination against people due to their sexual orientation is against the law.

During the debate, Asbill wanted to know if public facilities would be “protected” if the proposed law passed. Specifically, Sen. Asbill wanted to know what would happen if a gay couple wanted to use a public facility like a bandshell and the community rose up in protest against it. What rights would the community have, Asbill wanted to know.

A UNM lawyer who testified yesterday as a expert witness told Asbill that it is against the law to discriminate against people because of their race, religion, sexual orientation, age or disability.

The fact that a state senator needed to be schooled about the most elementary concepts of discrimination law on the floor of the legislature was, for me, chilling.

Not long after that Asbill joined four other senators to refer the bill to three committees and the bill was dead, for all practical purposes.

Before the vote, as I listened to testimony from witnesses called to explain why they support or oppose the bill, I was struck by one thing.

To a person, every supporter of the bill emphasized their basic humanity and dignity. As I listened to their moving stories about the discrimination they or their loved ones had suffered, I could not fathom how anyone could not see how simply giving gay people the same rights as straight people is not a civil rights issue.

I guess I can understand voting against a bill based on concern about its financial impact or its constitutionality. But when, like Sen. Asbill, you don’t understand that discrimination against people because of their sexual preference is a matter of civil rights, then voting against it is truly a travesty.

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Thank you, New Mexico Business Weekly, for an article last week that helps clarify what others have been saying all along in regards to the true reasons behind our state’s drop in oil and gas revenues.

The first paragraph of the article says it all:

“Revenue at the New Mexico State Land Office is expected to plunge by at least $250 million in the current fiscal year, a direct result of the drop in oil and natural gas prices.” (Emphasis mine.)

Another excerpt from the story:

“Last summer, oil was selling for $120 a barrel. Now it’s down to around $60. Natural gas was selling for $5 to $6 for a a cubic feet. Today it’s below $4.”

Those facts fly in the face of the arguments made by oil and gas industry spokespeople who blame pit rule regulations for the collapse of the industry in New Mexico. Opponents of the pit rule have said for years that the pit rules hurt oil producers by costing them thousands of dollars to comply.

Under the leadership of the recently-fired Bob Gallagher, the New Mexico Oil and Gas Association has challenged the need for pit rules by claiming there have been no past instances of groundwater contamination from oil and gas production.

You only have to read excerpts from this rebuttal by Joanna Prukop, the former Secretary the New Mexico Energy,  Minerals, and Natural Resources Department,  to understand those claims by the oil and gas industry are unfounded:

From her 2008 guest column in the Farmington Daily Times:

“Evidence presented at a recent hearing held by the Oil Conservation Commission, or OCC, clearly and definitively demonstrated that a significant number of serious groundwater contamination cases have resulted from the use of pits by the oil and gas industry.

Today (which was in 2008), OCD records show more than 421 such cases of pit-related contamination. Such an increase in a relatively short period of time is a clear sign that the state has a problem with oil field waste pits currently in use, and from many other pits poorly closed in the past.”

What’s even more interesting is this excerpt from the same column that explains how the oil and gas industry had helped formulate the pit rule and initially did not express the ominous misgivings about the pit rule:

“The industry was also fully engaged in the creation of the new Pit Rule. In fact Bob Gallagher, president of the New Mexico Oil and Gas Association, had stated that while the new regulations were tough, the industry could live with them. Furthermore, testimony during the OCC hearing clearly showed that any increased costs to industry that might result from the new Pit Rule are not unreasonable.”

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After a vigorous debate and much input from big business lobbyists and advocates for social services, healthcare and education, the House Taxation and Revenue Committee on Monday approved a measure that would levy a 1.5 percent surtax on wealthy New Mexicans.

Specifically, the surtax would affect single state tax filers who make more than $133,000 in taxable income, married separate filers who make more than $100,000 in taxable income and married joint filers who make more than $200,000 in taxable income.

If approved, the tax would sunset after three years.

The original proposal, HB 9, was brought to the committee by Rep. Ed Sandoval, who said the move is painful but necessary for the state to be able to provide vital services to its residents.

Rep. Ben Rodefer moved to amend the amount of the surtax to 1.5 percent. It’s been estimated that levying a 1 percent surcharge would generate about $48 million – a 1.5 percent change would generate about $74 million.

Speaker Lujan spoke strongly in favor of the 1.5 surtax.

“People recognize the need for additional revenue if we are going to keep viable services,” said Lujan.

A number of lobbyists for various businesses interests spoke strongly against the measure, including Art Hull from the Association of Commerce and Industry, Terri Cole from the Greater Albuquerque Chamber of Commerce.

Hull argued that wealthy people tend to spend their money on goods and services that benefit New Mexico. They also make investments and donate to charitable organizations. Raising the tax would cause the well-off to cut back on hiring and salaries, not to mention to reduce charitable donations to the very organizations that are advocating for the tax hike.

“It is easy for us to stereotype high-income individuals as people who hide their money away in jars and mattresses, and as people who have unduly benefitted from tax breaks,” said Hull. “We need to be careful to not assume that these are just wealthy people with extra money laying around.”

Later in the meeting, Speaker Lujan directly addressed Cole, asking her if she’d heard about last week’s referendum in Oregon that saw people approving tax increases for corporations and wealthy Oregonians.

Cole told Lujan she’d heard of the election.

“I think when people recognize that there is a need for revenue to sustain the viability of education and other needs, they are willing to tax themselves a little bit,” Lujan replied. “When the referendum (to raise taxes) went to the people, the people passed it.”

Rep. Rodefer also spoke in favor of the amended measure.

“When times were good, we gave these people tax breaks. And if you look at the measure, these people will still be paying significantly less than were before they got the tax breaks in 2003, he said. “And we were fine. Businesses didn’t shut down or stop hiring. We succeeded. “

In the end, the amended measure passed by vote of 10-6 along party lines.

Stay tuned to this spot or track the progress of HB 9 at the New Mexico Legislature web site.

In the meantime, check out this quote from Nobel Prize-winning economist Joseph Stiglitz about how high-income families tend to spend their money:

“Every dollar of state and local government spending enters the local economy right away, generating a greater economic impact. The impact is especially large when the money goes for salaries of teachers, policemenand firemen, doctors and nurses and others that provide vital services to our communities.”  In contrast, “raising taxes on high income households also will reduce spending, but by less than the amount of the tax increase since those with plenty of income typically spend only a fraction of their income – and some of what they spend is spent on luxury goods made abroad.” Furthermore, lower-income families tend to spend more of their incomes locally than higher-income families.”

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Do people who support combined reporting just not understand combined reporting?

That’s what big business lobbyist Richard Minzner claimed during Thursday’s meeting of the House Business and Industry Committee.

The committee met to discuss HB 62, which was sponsored by Rep. Ray Begaye and would require out-of-state businesses with more than 250 employees to report and pay taxes on the income they make in New Mexico. A similar measure, SB 90, is being sponsored by Sen. Peter Wirth.

Supporters of combined reporting believe the millions of dollars that would be generated by closing the tax loophole for out-of-state corporations and making them pay their fair share could go a long way toward closing New Mexico’s looming budget gap for 2011. Many of the corporations that do business in New Mexico already pay higher tax rates in other states.

The revenue raised would help New Mexico stave off the drastic cuts to education, healthcare and other state services some legislators are proposing now.

Opponents of combined reporting, including out-of-state-corporations and their New Mexico lobbyists, hang their hat on the absurd argument that implementing combined reporting would cause businesses like Wal Mart, Target, Bank of America and Comcast to leave the state or decline to do business here. That comes in the face of a report here from the Center of Budget and Policy Priorities that notes that most of companies who do business in New Mexico already do business in other states with combined reporting.

At Thursday’s meeting, a parade of those supporting the very biggest corporations spoke about how making them pay income taxes in New Mexico “demonizes” them simply for being large. That came from Art Hull, a lobbyist for the Association for Commerce and Industry.

Greater Albuquerque Chamber of Commerce president Terri Cole jumped on the jobs meme, saying that combined reporting would somehow discourage both small and large business from bringing jobs to New Mexico – even though the bill would in fact level the playing field for small, locally-owned businesses in the state.

And the list went on, with lobbyists from Chevron, Public Service Company of New Mexico, the oil and gas industry, retailers, manufacturers and more all opposing combined reporting or asking for “carve-outs” for their industry only.

Several legislators spoke against combined reporting, too, including Democratic Rep. Sandra Jeff of Crownpoint,  Republican Rep. Tom Taylor of Farmington and particularly Republican Rep. Keith Gardner of Roswell, who said New Mexicans should be thanking companies like Wal Mart for doing business here.

Most interesting though, was former state Tax and Revenue Secretary Minzner, who is now a lobbyist and perhaps the most outspoken opponent of combined reporting.

Supporters of combined reporting just don’t understand it, he says. Making out-of-state corporations pay income taxes in New Mexico will just encourage them to give themselves a tax cut by reducing their investments in the state.

That’s not what’s happened in the many other states all around New Mexico that have combined reporting – here’s a report that directly refutes his claim -  but that’s what Minzner keeps saying, to anyone who will listen.

Let’s hope the legislators don’t.

HB 62 will be heard again on Tuesday in the B and I committee.

Stay tuned to this spot to see what happens as it makes it way through the Legislature.

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