2010 Legislative Session

• Governor Richardson:  http://www.governor.state.nm.us/contact.php?mm=6
• Rio Rancho Public School's Legislative Priorities (pdf - Reader required)
• Click here to contact Rio Rancho state legislators
• Find members of the House of Representatives
• Find members of the Senate

Update: 3/9/2010

During the recent special session, the state legislature approved a compromise proposal that includes cuts to education as well as other areas of state government as well as some measures that raise taxes.   The budget represents a middle ground between proposals that would have mostly spared education, and proposals that could have resulted in additional cuts as high as 3.8%. 

The budget approved by the legislature and awaiting signature by Governor Richardson:

• Cuts funding to school districts by an additional 1.2% (approximately $1.2 million for Rio Rancho) above and beyond the cuts already absorbed by the district through the October special session. (View these cuts here).  Proportionally, operational funding through the funding formula that pays for teaching and learning will take a smaller cut (about 1%), while other areas such as transportation and textbooks will face steeper percentage cuts.
• Increases costs to employees for health insurance above and beyond the steep increases employees experienced this year.  While the impact is not as dire as proposed in the regular session, funding for employee insurance plans will still be cut about 40% from this year’s level.  Added costs to employees would most likely include increases in premiums, copayments, deductibles, and out-of-pocket costs for prescription drugs. This has been described by some legislators as a “hidden tax” on school employees.
• The proposal leaves employee contributions to retirement plans at the current level resulting from last year’s 1.5% shift from employer to employee.  It does not propose any additional increases to employee retirement contributions. 
• In addition to the 1.2% cut mentioned in the first bullet, a provision called “sanding” would require that an additional .544% of all public school funds be held back essentially as a contingency fund for the state.  This amounts to an additional $500,000 +/- cut to Rio Rancho’s operational budget, with corresponding cuts in transportation, instructional materials and other areas funded outside the operational budget.

Data provided by the Senate Finance Committee indicates that since January of 2009, funding for public schools has been cut 5.1% (before “sanding”).  If “sanding” is figured in, the cut is about 5.65% (close to $5.5 million for RRPS, since each 1% cut represents approximately $1 million).   State agencies and higher education have seen even larger percentage cuts. 

In order to balance the budget, the state would have to generate additional revenue from taxes.  During the special session, the legislature passed several tax measures, including:

• One-eighth cent increase in the gross receipts tax. 
• Restoration of a portion of the gross receipts tax applying to food, averaging approximately 2% statewide.
• An increase in personal income tax rates for taxpayers who itemize and take a deduction on their federal returns for state income taxes.  New Mexico personal income tax would apply to state income taxes deducted on federal tax returns.  The change would take effect for the 2010 tax year.
• An increase in the cigarette tax by 75 cents a pack, bringing it to $1.66 starting in July and continuing until July 2014.  For the first year, a third of the revenue from this tax would be earmarked for early childhood education programs, including public school pre-K programs (this could potentially benefit Shining Stars Preschool).
• Enforcing collection of the compensating tax for businesses and individuals buying goods and services from out-of-state vendors (however, this would not apply to individuals buying items via the Internet).
• Expanding an income tax rebate for low-income New Mexicans, those earning up to $24,000, to help offset the effect of the increases in gross receipts and food taxes.
• Allowing for a tax amnesty program which for a limited period would allow individuals and businesses to pay their unreported taxes without penalties or interest. Supporters contend the state will collect more tax revenues to help with budget problems.

Should the Governor not approve one or all of the tax measures, the state budget would have to be reduced correspondingly, since the state is constitutionally required to have a balanced budget.  Therefore, the Governor would have to reduce the proposed budget by the amount of the estimated revenue loss, which could result in further cuts to budgets for all state entities including education. 

About the Rio Rancho Public Schools budget

The Rio Rancho Public Schools budget actually consists of a series of separate funding sources.  The possible funding cuts would affect the operational budget, which supports teaching and learning in classrooms.  Click here to view a chart showing the various funding sources. 

 

How does RRPS spend its money?

The vast majority of Rio Rancho Public Schools operational budget pays for people: salaries and benefits.  These two areas, along with utilities and insurance, are sometimes referred to as “fixed costs” – essential to the operation of the district.    

Taken together, these four areas account for nearly 95% of the budget.  This is why it is so difficult to cut the budget without cutting salaries and/or jobs.  Estimates of the needed cuts run as high as 10%, but even a 3% - 5% cut would be difficult to absorb without affecting salaries and benefits.