The Rio Grande Foundation, New Mexico’s only free market think tank, launched the “No Way Santa Fe” public education initiative today to inform Santa Fe residents about the negative impacts of Mayor Javier Gonzales’ proposed tax on sugary drinks.

The “No Way Santa Fe” initiative will use a variety of methods to educate New Mexicans about what Mayor Gonzales’ tax will really do to their pocket books, the regressive nature of his tax and the harm it will do Santa Fe businesses.

“Mayor Javier Gonzales may think Santa Feans will fall for his tax-and-spend scheme, but he will soon find the city different as most residents are opposed to regressive taxes that target the poor and middle-class,” Paul Gessing, president of the Rio Grande Foundation, said.

The ballot measure which will be voted on May 2 (with early voting starting on April 12) would levy a tax of 2 cents per ounce on “sugary” drinks. Proceeds would be used to create a new city-wide bureaucracy to administer “pre-k” programs.

The Rio Grande Foundation released a report in January that detailed the public deception campaign Mayor Gonzales used to push his tax scheme through the city council.

“Rarely have so many issues of concern to supporters of limited-government aligned themselves in one ballot question,” Gessing said.

He also noted that proposed tax is:

• Bad tax policy that unfairly targets the consumers of legal products for heavy and regressive taxation (borne disproportionately on poor and middle-class consumers);
• Bad criminal justice policy that will result in the creation of an illegal market in ‘smuggled’ soda;
• Bad social policy as it taxes sugary drinks at a far-higher rate than New Mexico taxes beer (a product which has similar calorie content and numerous alcohol-related issues as well);
• Bad education policy as the effectiveness of pre-K programs nationwide is doubtful, with the new funding mechanism expected to decline in the future.

Similar taxes have been decried from across the political spectrum including by then-Presidential candidate Bernie Sanders who said, “At a time of massive income and wealth inequality, it should be the people on top who see an increase in their taxes, not low-income and working people.”

The Teamsters Union in Philadelphia has also led the opposition to that city’s tax.

The Rio Grande Foundation has long advocated for lowering New Mexico’s tax on beer (the excise tax on beer is 41 cents/gallon, among  the nation’s highest). The RGF supported lowering the tax to 8 cents/gallon and opposed recent efforts to raise the tax. 

The point is, we take taxes on beer seriously and oppose placing undue tax burdens on alcohol consumers.

Enter the City of Santa Fe with its 2 cents/ounce soda tax proposal which, if adopted by voters on May 2nd, would burden drinkers of soda and other sugary drinks with a tax more than six times higher than New Mexico’s already-high tax on beer.

As seen below, when it comes to calories, there is no excuse for treating beer more gently than soda. Throw in DWI and other problems associated with alcoholism and it is positively inexcusable to charge such high tax rates on soda relative to beer (again, we are not advocating for higher taxes on beer, wine, or liquor).

The Foundation is tracking announcements of expansions, relocations, and greenfield investments published on Area Development‘s website. Founded in 1965, the publication “is considered the leading executive magazine covering corporate site selection and relocation. … Area Development is published quarterly and has 60,000 mailed copies.” In an explanation to the Foundation, its editor wrote that items for Area Development‘s announcements listing are “culled from RSS feeds and press releases that are emailed to us from various sources, including economic development organizations, PR agencies, businesses, etc. We usually highlight ones that represent large numbers of new jobs and/or investment in industrial projects.”

In March, of 14,157 projected jobs, 11,510 — 81.3 percent — were slated for right-to-work (RTW) states:

As for the sub-metrics the Foundation scrutinizes:

* Fifteen domestic companies based in non-RTW states announced investments in RTW states. Just one announcement went the other way.

* RTW prevailed in foreign direct investment, too. Seventeen projects are headed to RTW states, with five to occur in a non-RTW state.

Marquee RTW investments included:

* UPS upgraded a Texas warehouse into a “regional hub” (1,400 jobs)

* Gartner, “a global information technology research and advisory company” based in Connecticut, will expand its facility in Florida to house new “positions in sales, client service, research, finance, and more” (600 jobs)

* HARIBO, the Germany-based confectioner, picked Wisconsin for its “first North American manufacturing facility” (400 jobs)

* Biomerics decided to remain in Utah to construct a new, $38.5 million headquarters (380 jobs)

* Japan-based NTK Precision Axle Corporation chose Indiana for “a new manufacturing facility” (200 jobs)

* Bidell Gas Compression, a subsidiary of Canada’s Total Energy Services, announced that it will locate its “first United States manufacturing operation” in West Virginia, to “fabricate, sell, lease and service natural gas compression equipment to customers operating throughout North America and internationally” (130 jobs)

* General Electric, in the process of moving its headquarters from Connecticut to Massachusetts, expanded its MRI “components production operations” in South Carolina (100 new jobs)

Methodological specifics:

* All job estimates — “up to,” “as many as,” “about” — were taken at face value, for RTW and non-RTW states alike.

* If an announcement did not make an employment projection, efforts were made to obtain an estimate from newspaper articles and/or press releases from additional sources.

* If no job figure could be found anywhere, the project was not counted, whether it was a RTW or non-RTW state.

* Non-border-crossing relocations were not counted, border-crossing relocations were.

The governor has yet to sign HB 266, a curious development for legislation that passed the House of Representatives 61-0 and the Senate 30-8.

The bill, as described by the Legislative Finance Committee, “removes an exemption from the occupancy tax for short-term rentals (less than 30 days) by a vendor that does not offer at least three rooms within or attached to a taxable premises for lodging or at least three other premises for lodging or a combination of these within the taxing jurisdiction,” apparently in an attempt to “remove an unanticipated tax exemption for homeowners who rent rooms through third-party websites and applications.”

In other words, the bill is aimed at Airbnb.

Errors of Enchantment has explored the state’s lodging tax before, explaining that local governments are tasked with using the revenue it generates for “advertising, publicizing and promoting tourist-related attractions, facilities and events.”

But leaving the corporatism issue — i.e., local governments shouldn’t be in the tourism-promotion business — aside, HB 266 deserves the governor’s skepticism for a simple reason: It doesn’t cut the lodging tax’s rate.

Business is “booming in New Mexico” for Airbnb, the Albuquerque Journal reported earlier this year, with around 2,300 “active” Airbnb hosts, who “recorded 119,900 guest arrivals in 2016,” more than 100 percent growth over 2015.

So here’s an inconvenient question for HB 266’s advocates: With all those new, tax-paying entities funneling money into the lodging tax’s revenue stream, why not cut the rate? The bill doesn’t do that, of course, despite the gusher of new funds it could create.

If the Land of Enchantment must have a lodging tax, why not reduce its maximum rate of 5 percent, and make the state’s hospitality industry a bit more competitive?

Update (April 7): The governor has vetoed HB 266, stating that “tourism in our state is flourishing, and the prevalence of short-term property rentals helps bring more and more people to see what New Mexico has to offer.”

On May 2nd (with early voting beginning April 12),a special election will be held solely for Santa Fe Mayor Javier Gonzales’ highest-in-the-nation 2 cent-per-ounce beverage tax on drinks with added sugar. Voters across the nation have rejected similar taxes 43 times over the past several years, but it’s been a long and winding road since the issue in Santa Fe has reared its head leaving many to ask how we got here.

October 12, 2016: Santa Fe Mayor Javier Gonzales introduces a resolution calling for the city to “to explore active ways of reducing sugar intake among Santa Fe’s residents and the benefits that would result.”

October 19, 2016: On this blog, the Rio Grande Foundation quickly calls the mayor out for “mission creep” and suggested a crusade against sugar doesn’t belong on his to-do list.

October 21, 2016: Mayor Gonzales denies he is working on a tax, telling T.S. Last of the Albuquerque Journal:  “This doesn’t lay the groundwork for anything but a healthier community.”

October 29, 2016: In a piece published in the Santa Fe New Mexican, RGF Research Director Dowd Muska warns readers: “don’t buy the mayor’s claim.” Taxing soda, after all, has become an idée fixe for the left’s unsleeping army of lifestyle police.

November 10, 2016: Mayor Gonzales proves us right, announces a proposal to impose a highest-in-the-nation (tied with Boulder, Colorado) two-cent-per-ounce beverage tax a long list of beverages.

January 25, 2017: The Rio Grande Foundation issues a report that found Mayor Gonzales misled the public about his intention to impose a beverage tax from the start. He and his staff had already been planning a beverage for weeks when he denied it to the Albuquerque Journal.

March 8, 2017: The Santa Fe City Council votes to hold a special election, at a cost to the city of up to $95,000, to decide on the issue.

The Albuquerque Coalition for a Healthy Economy (a broad-based coalition of business and free market groups) filed a lawsuit in State District Court today due to the Healthy Workforce Ordinance. Among the legal concerns expressed by the coalition were “logrolling,” requirements to provide workers paid sick leave who work as few as 56 hours, absurd requirements relating to legal fees, and onerous requirements on notification and record-keeping.

Lastly, the ballot measure which will be voted on in October attempts to tie the hands of future lawmakers in ways that are clearly illegal.

The Rio Grande Foundation has been opposed to government requirements to mandate paid sick leave since day one.

With New Mexico facing the nation’s highest unemployment rate, the last thing businesses or workers need is yet another set of government mandates that impose costs on businesses that will be passed along to consumers in the form of higher costs and to workers in the form of reduced flexibility in work arrangements and even fewer jobs being available.

Already, Bernalillo County has recently raised taxes, State lawmakers have been pushing for higher taxes, and the City of Albuquerque could be facing additional tax hikes due to its own budget woes. More regulations on businesses are the last thing Albuquerque needs.

“Spaceport America” has lost another potential client to a rival.

Earlier this week, Vector Space Systems, “a micro satellite space launch company comprised of new-space and enterprise software industry veterans from SpaceX, Virgin Galactic, McDonnell Douglas, Sea Launch and VMware,” signed an agreement with Spaceport Camden to “conduct a sub-orbital flight test of Vector’s full-scale launch vehicle, the Vector-R, as early as this summer.”

Last year, California-based Vector picked Arizona for its new manufacturing facility. Now it plans to send staffers flying over New Mexico on their way to test rockets in southeast Georgia.

The Land of Enchantment’s taxpayers are accustomed to Spaceport America falling on its face, but in this case, the defeat is particularly bitter.

Spaceport Camden, you see, doesn’t exist.

The site, which The Atlanta Journal-Constitution described in 2015 as “pine stands and coastal swamps where wild boars, armadillos and rattlesnakes roam,” has no infrastructure. The feds haven’t issued an operator license. And eco-activists, as well as local homeowners, are fighting the proposed spaceport.

In contrast, Spaceport America has “unique geographic benefits,” “basic operational infrastructure such as an airfield, launch pads, hangars, emergency response capabilities, 24/7 security, utilities and roadways,” and is “capable of accommodating the activities of both vertical and horizontal takeoff space launch vehicles, serving as the base for pre-flight and post-flight activities, and providing a tourism experience for interested visitors and spectators.”

Nice, but evidently, not enough. Vector prefers to test its launch vehicle in Georgia. Think New Mexico’s economic-development bureaucrats are interested in finding out why?

The latest news from the Santa Fe soda tax front is that full-strength (ie. sweetened) soda has been removed from the City Hall vending machine. Only diet and zero-sugar options are available.

Interestingly, while advocates on both sides refused to comment, Sandra Wechsler, campaign manager for Pre-K for Santa Fe, a group working in support of the tax, said the mayor’s proposal is “already working.”

That is an interesting take because a big part of soda tax involves the creation of an expensive new pre-K system. If people stop buying soda (at least at the traditional grocery store as opposed to online, for example), there won’t be money available for the Mayor’s expensive new pre-K program.

If your goal is to force certain vendors to replace sugary soda drinks with diet drinks, then the effort is indeed “already working,” but people could be getting those drinks elsewhere or drinking equally-sugary but untaxed drinks. However, if your goal is to generate enough revenue from selling sugary drinks to create a new government program, you have a VERY long way to go.

The deadline to register to vote in this election is April 3rd. You can register online.

Early Voting: April 12-April 28

Office of the City Clerk, Room 215, City Hall, 200 Lincoln Avenue
Genoveva Chavez Community Center, 3221 Rodeo Road

Election Day voting: May 2 (7am-7pm)

Montezuma Lodge, 431 Paseo de Peralta
St. John the Baptist Catholic Church, 1301 Osage Avenue
St. John’s United Methodist Church, 1200 Old Pecos Trail
Christian Life Church, 121 Siringo Road
Sweeney Elementary School, 4100 S. Meadows Road
Southside Library, 6599 Jaguar Drive
Kearny Elementary School, 901 Avenida de las Campanas
Genoveva Chavez Community Center, 3221 Rodeo Road

Given the type of folks in charge of New Mexico’s two legislative chambers, there was no doubt that this year’s session would not produce sweeping economic-development initiatives based on liberating labor and capital to grow jobs and wealth in the Land of Enchantment.

But while right-to-work was dead on arrival in Santa Fe, that’s no reason for New Mexico’s local governments to fear ending compulsory unionism within their jurisdictions.

Under legislation passed over Harry Truman’s veto, states have the ability to enact laws to bar “organized labor” from compelling workers to cough up dues or “agency fees” to keep their jobs. But with progress blocked in Frankfort, in 2014, Kentucky counties began passing their own RTW ordinances. Legal squabbling inevitably ensued, with Big Labor targeting Hardin County over its 8-1 vote to go RTW. As the state’s AFL-CIO chief put the left’s conventional wisdom, RTW could only be enacted “at the state level.”

In early 2016, U.S. District Judge David J. Hale ruled against the county. But in November, his decision was overturned by a three-judge panel of the U.S. Court of Appeals for the Sixth Circuit. Written by Judge David W. McKeague, the opinion found that “political subdivisions are components of the State, within the State, that exercise governmental power of the State” — ergo, local RTW ordinances are allowed.

The issue is likely to be settled by the U.S. Supreme Court one day, since it is being contested in Illinois as well. (Lincolnshire, a suburb of Chicago, went RTW in 2015, and it falls under the Seventh Circuit.) But McKeague presented some compelling arguments for “local RTW,” including two noteworthy precedents that would be tough for justices to overlook:

* “The principle is well settled that local governmental units are created as convenient agencies for exercising such of the governmental powers of the State as may be entrusted to them . . . in its absolute discretion. The exclusion of political subdivisions cannot be inferred from the express authorization to the ‘States’ because political subdivisions are components of the very entity the statute empowers.”

– Wisconsin Public Intervenor v. Mortier (1991)

* “Absent a clear statement to the contrary, Congress’ reference to the ‘regulatory authority of a State’ should be read to preserve, not preempt, the traditional prerogative of the States to delegate their authority to their constituent parts.”

– City of Columbus v. Ours Garage and Wrecker Service (2002)

Local-government officials throughout New Mexico should seriously consider adopting their own RTW measures. As research by the Rio Grande Foundation and many other organizations shows, banning compulsory unionism is a strong economic-development tool. And with the highest unemployment rate in the nation, the need for labor freedom in our state is more urgent than ever.

Tom Udall and Martin Heinrich claim that it “fails to bring clean energy jobs to our rural communities, ignores the impacts that extreme weather will have on our economy and our national security, and does not decrease our reliance on foreign oil.”

Ed Markey believes that it’s “an attack on science, on climate, on the clean energy revolution.”

And the Sierra Club wails that it will “only deepen our dependence on fuels that pollute our air, water and climate while making our kids sicker.”

The White House’s “Executive Order on Promoting Energy Independence and Economic Growth,” which the chief executive says will spark “a new era in American energy and production and job creation,” has the eco-extremism lobby pitching a collective fit. But the measures the document includes — including suspension of major portions of the “Clean Power Plan,” the lifting of Barack Obama’s ban on coal-leasing activities on federal land, and nixing of the review of the “social cost” of carbon — are spectacularly good news for New Mexico.

Source: annual reports, New Mexico Energy, Minerals and Natural Resources Department

Coal-mining employment in the Land of Enchantment dropped by 24.2 percent between 2012 and 2015, and it’s a near-certainty that the numbers were down last year, too. The president’s policy reversal may not bring coal back to what it was before the era of fracking-driven cheap natural gas, but it will stanch the bleeding.

Source: Quarterly Census of Employment and Wages, New Mexico Department of Workforce Solutions

As for oil and gas in New Mexico, jobs in the sector tumbled by 17.9 percent between the fourth quarter of 2014 and the third quarter of 2016. A price uptick has employment looking up, but regulatory relief from Washington will surely help.

With stunning air-quality improvement in recent decades, and energy-related carbon dioxide emissions for the first six months of 2016 the lowest since 1991, the Obama administration’s regulatory assault on coal, oil, and natural gas was wholly unnecessary. Ignore the “green” crowd’s cartoonish hysteria. The White House’s pro-energy agenda is good news for a state that hasn’t had much to smile about for quite some time.

The Rio Grande Foundation has long noted that many of the highest income states (California, New York, Connecticut as examples) are “blue” states that have embraced big-government economic policies, but still have ample private sector business communities. Some, like California’s tech sector remain strong while many East Coast manufacturing hubs are losing ground.

On the other hand there are many “red” states that have lower living costs and are growing faster than their “blue” rivals both economically and population-wise.

There were a handful of states like New Mexico and West Virginia that were both poor and “blue” (when state policies were considered) but in November of 2014, West Virginia’s Legislature flipped to Republican. And, while the State continues to have a Democrat in the Governor’s mansion, the Legislature can override most vetoes with a mere majority. Thus, West Virginia went Right to Work, repealed its Davis-Bacon “prevailing wage” law, and generally moved the State in a more business-friendly direction (these policies took effect in July of 2015). New Mexico, on the other hand, moved back towards its traditional embrace of big-government policies in the 2016 election and saw myriad tax and minimum wage hike proposals moved through. While these were vetoed by the Governor, she is a “lame duck” and, if anything, New Mexico is poised to lurch further to the left in the near future. West Virginia which went 68 for Trump shows no signs of doing so.

What has that meant for economic conditions on the ground? I’ll let you, dear reader, parse that for yourself:

Bernalillo County Commissioner Wayne Johnson had an excellent opinion piece in the Albuquerque Journal today detailing the misadventures and bad information the Democratic majority is using to push for higher taxes.

Of course, we are also in the middle of an increasingly-dramatic standoff over tax hikes passed in the Legislature that are forcing further adjustments in State government.

All of this comes at a time when New Mexico’s economy is in bad shape with highest-in-the-nation unemployment. But many seem to believe that higher taxes simply won’t impact the economy in any negative way.

Economists, even liberal ones, tend to agree that tax hikes indeed stifle economic activity. In fact, Christina Romer, formerly head of President Obama’s Council of Economic Advisors, has written in some detail on the issue of tax hikes and economic growth. Her conclusion from a 2010 study, “Our estimates suggest that a tax increase of 1 percent of GDP reduces output over the next three years by nearly three percent. The effect is highly statistically significant.”

Source: Kaiser Family Foundation (Utah and New Mexico data for 2015; Colorado, Oklahoma, and Texas data for 2014, Arizona data for 2013)

Suggestion for a gutsy candidate looking to become the next governor: Pledge that by the end of your administration, fewer than 50 percent of the Land of Enchantment’s newborns will come into the world on the taxpayer’s dime.

The news that New Mexico has more of its babies born on Medicaid than all other states won’t surprise anyone who’s been paying attention. (Several of our neighbors, as the graph above shows, fare substantially better.) But it does illustrate the extend to which welfarism is a way of life in the Land of Enchantment. And with a dismal economy, now marked by the worst unemployment rate in the nation, Medicaid’s share of births is likely to grow.

Not too long ago, we were told by the usual suspects — Winthrop Quigley, Lee Reynis, New Mexico Voices for Children — that Medicaid expansion would “pay for itself.” Serious policy analysts knew that claim was nonsense, and our well-justified skepticism has been confirmed again and again.

But fiscal policy aside, the human toll of Medicaid expansion must not be overlooked. Brought into the world on welfare, it’s a near-certainty that many of the state’s Medicaid babies will grow up, and remain, trapped in the dungeon of dependency. Is there a courageous candidate willing to admit as much, publicly — and commit to taking the steps needed to turn the trend around?

Bernalillo County is coming after your wallets – again. The latest money grab is for a 3/16ths percent increase in the gross receipts tax. Since 2000, the local GRT burden has jumped from 5.8125 percent to 7.3125 percent. This latest proposal would bring the tax rate to 7.5 percent.

That’s a 29 percent overall increase in the GRT since 2000. The Bernalillo County Commission will vote at the end of March to move the local GRT rate to 7.5 percent; it was 7.0 percent as recently as 2015.

The local tax hikes are bad enough, but the Legislature is attempting to pile on its own tax increases, including a 10-cent-per-gallon hike in the gas tax. Both the gross receipts tax and the gas tax are “regressive,” meaning they impose a heavier burden on poor and low-income people in our state. Despite this reality, the political left in our state seems all too willing to raise taxes.

This leads us to the county commissioners who are pushing for the tax hikes. Democrats Maggie Hart-Stebbins, Debbie O’Malley and Steven Michael Quezada have all voted to support the 3/16th GRT increase. They have the authority to take more of our hard-earned money without first coming to the voters for permission.

Such an aggressive move would be ironic, especially for Hart-Stebbins and O’Malley, considering that both supported placing a nonbinding question on the November ballot relating to Albuquerque Rapid Transit. To be clear, we at the Rio Grande Foundation joined the commissioners in supporting the ART ballot measure because we strongly believe that voters should have the final say on major decisions being made with their tax dollars.

Now that these commissioners are looking to take more money out of our pockets via a GRT increase, one would expect that a ballot measure would be in order for the sake of consistency, if nothing else. Whether to raise gross receipts taxes to 7.5 percent in Bernalillo County seems like a question you’d want to hear from the voters on this fall.

In Colorado, a state that has consistently outperformed New Mexico economically for many years, every tax increase must be voted on by the people under their constitution. Unfortunately, our Legislature hasn’t seen fit to adopt a similar provision, but the majority on the County Commission seems to like voter input – at least when it fits their agenda. This would be an opportunity to take the lead on engaging voters.

This state – and the Albuquerque metro is no different – has been buffeted by bad economic news for the better part of a decade. Raising taxes is not going to help matters. I hope a majority on the commission opposes this tax hike on moral and economic grounds. But if they truly wish to push the matter forward, I hope they’ll give voters the final say.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

We’ll take good news about New Mexico’s 2017 legislative session any way we can get it, and the passage of HB 341, however modest its likely impact, is good news.

Prior to a few days ago, Errors of Enchantment had no idea what eyebrow threading was. But we quickly got up to speed, learning that the process involves a beautician using “a cotton thread to open and close loops around … facial hair, removing it at its follicles.” Threading traces its origin to ancient Asia, and is becoming increasing popular in America.

You know where this story is headed. Recent years have seen bureaucrats target eyebrow-threaders for violating regulations pertaining to cosmetology.

Arizona, Texas, Louisiana — in state after state, threading entrepreneurs have had to resort to legal action to free themselves from training and certification mandates that rarely pertain to their craft. As an Institute for Justice attorney told The Washington Free Beacon: “Eyebrow threading is a simple technique that uses just a single strand of cotton thread and nothing else. The government cannot force threaders to quit work and waste time and money learning cosmetology techniques that threaders do not use. That’s not just wrong; it’s unconstitutional.”

So here’s an “attaboy” to the 53 representatives and 27 senators who voted for HB 341, which exempts “persons providing only eyebrow-threading services” from the state’s Barbers and Cosmetologists Act as of June 16 of this year. It’s a step, however small, toward reality-based occupational licensing — something both the left and the right have united behind. (A 2015 report from Barack Obama’s Department of the Treasury, Council of Economic Advisers, and Department of Labor noted that “by making it harder to enter a profession, licensing can … reduce employment opportunities and lower wages for excluded workers, and increase costs for consumers.”)

In 2012, the Institute for Justice found that New Mexico was “the ninth most broadly and onerously licensed state with the 12th most burdensome licensing laws.” Yet despite the benefits that HB 341 will surely bring, legislators, almost unanimously, approved HB 295, which extended the sunset dates for a number of dubious licensing bureaucracies, including the Board of Acupuncture and Oriental Medicine, the Private Investigations Advisory Board, and the Interior Design Board. Lots more work remains, it appears, to educate lawmakers about needless occupational red tape.

An explosion of eyebrow-threading shops won’t turn around the Land of Enchantment’s dismal economy, but liberating the profession from unnecessary regulations is to be commended.

Gird for battle, New Mexico revenucrats. Some in D.C. are looking to clip a little bit of your cash.

Earlier today, the Judiciary Committee of the U.S. House of Representatives held a markup of H.R. 1393, the Mobile Workforce State Income Tax Simplification Act of 2017. Chairman Bob Goodlatte (R-VA) is a fan of the legislation, calling it “a clear, uniform framework for when states may tax nonresident employees who travel to the taxing state to perform work.” Fans of bipartisanship and “getting along” and “No Labels” — we’re looking at you, Bob Perls — will be pleased to learn that many in the congressional minority, including Sen. Sherrod Brown (D-OH), are supporters. He sees it as a “simple fix” that will “make filing taxes easier for workers who travel while also cutting burdensome red tape on businesses.”

The problem being addressed, as explained by the Mobile Workforce Coalition, is that states “have inconsistent, varying standards and requirements for employees to file personal income tax returns when traveling to a nonresident state for temporary work periods, and for employers to withhold income tax on employees who travel outside of their state of residence for temporary work periods. Employees who travel outside of their states of residence for business purposes are subject to onerous administrative burdens because they may be legally required to file an income tax return in every other state into which they traveled, even if they were only there for one day. Employers are required to incur extraordinary expenses in their efforts to comply with the states’ widely divergent withholding requirements for employees’ travel to nonresident states for temporary work periods. And in some cases, requirements for employees and employers aren’t the same.”

Half of income-tax states force employers to withhold from nonresident employees’ wages when the workers travel into the state for a single day. (See the map above.) At 15 days, New Mexico’s withholding law isn’t as draconian as Colorado’s mandate, which kicks in immediately. But there’s certainly room for improvement. Texas, of course, has no income tax to comply with. Arizona’s minimum is 60 days. Oklahoma’s standard is $300 or more per calendar quarter — not much of a perk, since that equates to an hourly rate of about a buck and a half an hour for a workweek of 40 hours.

The bill marked up today “provides for a uniform, fair, and easily administered law and helps to ensure that the correct amount of tax is withheld and paid to the states without the undue burden that the current system places on employees and employers. The Act provides a uniform 30-day threshold before the liability attaches and withholding is required. After 30 days, existing state laws will apply. Consistent with current law, the Act provides that an employee’s earnings are subject to full tax in his or her state of residence. Further, an employee’s earnings would be subject to income tax in the state(s) in which the employee is present and performing duties for more than 30 days during the calendar year.”

The Tax Foundation notes that just about everyone, “except some state tax administrators, supports this legislation.” Fedpols from around the nation, and both parties, have signed on as sponsors and supporters. But the list doesn’t include any member of New Mexico’s House delegation. And neither Tom Udall nor Martin Heinrich have endorsed the Senate version of H.R. 1393. Why not?

While Santa Fe has yet to adopt a budget for the state’s upcoming fiscal year, another expenditure plan — the White House’s multi-trillion-dollar list of what it wants to spend in the new federal fiscal year — was released last week.

For a glimpse at how dependent New Mexico is on D.C., look no further than the press release U.S. Sen. Martin Heinrich issued in response. The fedpol hysterically asserted that the budget did not reflect “our core values and principles,” and “would be devastating for New Mexico.”

Heinrich picked a curious item to place at the top of his litany of complaints. His first gripe was the president’s proposal to eliminate funding for the Department of Housing and Urban Development’s Community Development Block Grant. The senator’s love for the program notwithstanding, it’s a well-documented disaster. The Reason Foundation’s Victor Nava noted that “waste, fraud, and corruption [are] continually seen” with CDBG projects. The Cato Institute documented “a history of financial abuse and dubious … spending,” including a marina, renovations to a ski chalet, a shooting range, an off-track-betting facility, and “a festival to celebrate a shopping center.” There’s no shortage of documentation to justify CDBG’s richly deserved death: inspector general audits, reports from the Government Accountability Office, state investigations, exposés by the print and broadcast media.

Heinrich couldn’t be bothered to notice, but there’s a prime example of CDBG chicanery right here in his “home” state. In November, KRQE reported that the City of Albuquerque was asked to give Washington back “nearly a million dollars,” due to a “multitude of issues” regarding its handling of programs that received HUD funds. The bureaucracy now considers Albuquerque a “high risk” for grants, meaning that if reforms aren’t made, federal housing officials might freeze the city’s “ability to draw down from its HUD accounts.”

Heinrich’s tale of woe starts poorly, and gets worse. Energy subsidies, goodies from the Department of Education, the Community Services Block Grant, Amtrak, “public lands,” AmeriCorps — the shrieking is intense, because the chief executive “is not committed to the success of hard working families and our rural communities.”

In addition to checking in on waste and mismanagement of federal funds in New Mexico, the state’s junior senator should also click here. He’ll learn that the national debt, not counting unfunded pension and healthcare liabilities, is just shy of $20 trillion.

There are things to like and dislike about the president’s budget proposal, but no one can deny that the river of revenue flowing from D.C. to the Land of Enchantment will one day run dry. Isn’t it best to accept reality sooner rather than later, and begin implementing policies to ensure that New Mexico can stand on its own?

New Mexico’s dumpster-fire legislative session ended Saturday with no budget agreement between lawmakers and the governor and no noteworthy bills that promise to improve the Land of Enchantment’s dire economic/fiscal health.

But on the bright side, some truly awful pieces of legislation were not passed. Among the bullets dodged:

* Several bills, including HB 117 and SB 344, sought to hike income-tax rates.

* Multiple minimum-wage bills, including HB 27 and HB 67, would have raised the mandate to a jaw-dropping (and hyper-job-destroying) $15.00. An increase that was adopted hikes the minimum wage to $9.00 on April 1, 2018, with a lower, temporary rate allowed for trainee employees. It could be vetoed by the governor.

* HJR 2, the “brainchild” of Rep. Bill McCamley (D-Mesilla Park), would have squandered $7 billion from the Land Grant Permanent Fund on “infrastructure and energy projects,” as well as “clean energy and water technologies” and “early childhood services.”

* The charter-school moratorium, spearheaded by Rep. Christine Trujillo (D-Albuquerque), would have squashed all applications for the important school-choice option through January 1, 2020.

* SB 42, SB 54, SB 102, and SJR 7 attempted to disenfranchise New Mexico’s residents in presidential contests by awarding the state’s Electoral College votes to the winner of the national popular vote.

Yes, the 2017 session was a disaster. But hey, it could have been worse….

We knew the 2017 legislative session was going to be a tough one for individual liberty and free markets. While most of the country moved right, New Mexico lurched far to the left in the 2016 election.

And, with the highest unemployment rate in the nation, poor economic growth, and a budget shortfall, the conditions were ripe for an acrimonious 2017 session. We were not disappointed.

The good news: although we knew going into the session that no big reforms like “right to work, school choice, or “prevailing wage” repeal were going to make it through, the question was whether the Gov. would hold firm against higher taxes and raising the minimum wage. To date, she has indeed held firm vetoing tax hikes and economically-harmful minimum wage hikes.

Also, the Legislature (despite being firmly under Democrat control) was unwilling to tap the “permanent fund” for pre-K and more spending.

In summary, no major damage was sustained.

The bad news: Since Gov. Martinez is vetoing $350 million in tax hikes, that means the budget will be out of balance and that the Legislature is moving towards yet another special session. With Democrat legislators desperately wanting to raise taxes and Gov. Martinez holding firm against raising taxes, there are only a few potential outcomes:

1) Democrats fold and agree to budget cuts;
2) Some previously-unknown or untapped source of money is found to fill the budget gap;
3) Republican legislators fold and vote to override Gov. Martinez’s veto. Such a move could destroy the Republican Party “brand” in New Mexico for years to come;
4) Gov. Martinez folds and agrees to raise taxes (another move that could inflict terrible harm on the Republican Party for years;
5) A government shutdown the ultimate results of which are unclear but really boil down to the first three items on this list.

These are fraught times. New Mexico’s economy faces unprecedented challenges and the conservative movement faces existential challenges. Democrats have the proverbial wind behind them and feel it is only a matter of time until they hold all levers of power. If conservatives don’t stand firm, they risk becoming totally irrelevant in this State.

Contact your legislators, especially if they are a Republican and tell them not to raise taxes. Make sure they know that you are watching!

Also, support the Rio Grande Foundation which is providing clear data to show that New Mexico’s problem is bloated government, not inadequate revenue.

A reminder: find out how your legislators are voting on freedom and which bills voted on this session would have the biggest impact on freedom at our Freedom Index.

Click here for registration form.

Grover Norquist is president of Americans for Tax Reform (ATR), a taxpayer advocacy group he founded in 1985 at President Reagan’s request. ATR works to limit the size and cost of government and opposes higher taxes at the federal, state, and local levels and supports tax reform that moves towards taxing consumed income one time at one rate.

ATR organizes the Taxpayer Protection Pledge, which asks all candidates for federal and state office to commit themselves in writing to the American people to oppose all net tax increases. In the 115th Congress, 212 House members and 45 Senators have taken the pledge.

Grover is one of the most influential voices for free markets and limited government in Washington. What agreements will President Donald Trump and Congress come to on the all-important issues of healthcare and tax reform? How good/bad will these reforms be for taxpayers and the U.S. economy?

• Location:  Marriott Pyramid located at: 5151 San Francisco Rd NE, Albuquerque, NM  87109.
• When:  Monday, April 10, 2017, 12:00 noon to 1:00pm.
• Cost:  Seating is limited and can be purchased at the discounted price of $30 until Wednesday, April 5, 2017; $40 after that.

More about Grover Norquist: He chairs the Washington, DC-based Wednesday Meeting, a weekly gathering of more than 150 elected officials, political activists, and movement leaders. The meeting started in 1993 and takes place in ATR’s conference room. There are now 60 similar center-right meetings in 48 states including New Mexico.

He also:

• Serves on the board of directors of the National Rifle Association of America, the American Conservative Union, the Parental Rights Organization and Center for the National Interest (formerly The Nixon Center.)
• Serves as a Contributing Editor to the American Spectator Magazine.
• Serves as president of the American Society of Competitiveness.
• Authored four books: Rock the House; Leave Us Alone – Getting the Government’s Hands Off Our Money, Our Guns, Our Lives; Debacle: Obama’s War on Jobs and Growth and What We Can Do Now to Regain Our Future (with co-author John Lott) and End the IRS Before it Ends Us – How to Restore a Low Tax, High Growth, Wealthy America – published April 7, 2015.

Click here for registration form.

Was having a “discussion” on Twitter with two of New Mexico’s leading union officials. Both men strongly support Mayor Javier Gonzales’ plans to impose a 2 cent/ounce tax on sugary drinks sold in “The City Different.”

In doing some research on the issue I noticed that the Teamsters Union in Philadelphia was among the leading OPPONENTS of that City’s 1.5 cent/ounce tax on soda and sugary drinks. The following Tweets outline the exchange with Jon Hendry, head of the New Mexico Federation of Labor, AFL/CiO:

So, as I gather from Hendry’s comments, if Santa Fe’s bottler were unionized, his position might be the exact opposite of what he holds now. It would indeed be interesting if Santa Fe’s Coke distributor were unionized. Perhaps Mayor Gonzales wouldn’t even be undertaking this plan against a political ally?

There are all kinds of alternative scenarios, but the fact is that the unions have real political muscle and the way those muscles are used is less about political principle and ideology than it is about grasping self-interest. Easy for us think tank folk to lose sight of.

Otero County‘s pretty cool. White Sands National Monument, the Flickinger Center for Performing Arts, the New Mexico Museum of Space History (really cool), the Alamogordo Museum of History, Oliver Lee Memorial State Park, the Sacramento Mountains, Holloman Air Force Base — it’s an interesting place, and has contributed quite a lot to the Land of Enchantment’s culture and history.

But in sponsoring “a contest with students from all over Otero County to create a logo that represents the county in a more modern light,” the county’s commissioners have done something all “public servants” in the state should notice.

No offense to the artist, but Otero County’s current logo, depicted above, is kind of lame. So commissioners have asked Alamogordo Public Schools, New Mexico State University-Alamogordo, private-school pupils, and the homeschooled to design an update “a little bit more fresh and more updated to represent the county better.”

That’s quite a contrast to the approach Santa Fe County took in 2016. It “set aside nearly $100,000 to replace its logo,” paying nearly half of the sum to “GumCo, a creative agency in Salt Lake City, and … Southwest Planning & Marketing of Santa Fe, which conducted surveys and focus groups.”

But the new look was “met with underwhelming enthusiasm” by commissioners late last year, and a decision on the logo was postponed until January. What was the final outcome? We don’t know — no information is available online, and Errors of Enchantment contacted the county, but has received no response.

No, volunteers can’t do undercover police work, enforce zoning rules, adjudicate complex criminal/civil cases, and maintain official records. But there are abundant opportunities for members of the community to pitch in elsewhere, and in so doing render many local-government appropriations unnecessary.

In 2016, four out of five members of New Mexico’s congressional delegation had little, if any, regard for “the fiscal interests of American taxpayers.”

That’s the conclusion of the Council for Citizens Against Government Waste, which has released its 2016 congressional ratings. The organization “scored 65 votes in the House of Representatives and 16 votes in the Senate.” No fedpol in the former earned a perfect 100, but four senators won the title of “Taxpayer Super Hero,” including a senator just to our west: Arizona’s Jeff Flake.

New Mexico’s senators, both Democrats, each scored a 13, and were thus labeled “Hostile.” Two members of the House, Democrats Ben Ray Luján and Michelle Lujan Grisham, performed even more abysmally, scoring in the single digits. (That’s down in Nancy Pelosi territory.)

U.S. Rep. Steve Pearce, a Republican whose district comprises the southern half of the Land of Enchantment, was found to be a Taxpayer Hero. He scored an impressive 91.

CAGW looked at legislation covering everything from redundant catfish regulations to the banning of Internet-access taxes, Puerto Rico’s insolvency to Obamacare. Here’s the full list of bills that were scored.

Clearly, when it comes to “important tax, spending, transparency, and accountability measures,” New Mexico’s delegation has plenty of room for improvement.

As the 2017 legislative session heads toward a conclusion absent any significant economic reforms, but having passed several tax hikes that may be vetoed by Governor Martinez, the State’s economic picture continues to darken.

After months of hovering near the top of the national ranking of states with the highest unemployment rates, New Mexico “broke through” in January rising to 6.7%. The contrast is even more stark when New Mexico is compared against its more economically-free and successful neighbors, especially Colorado which does not have “right to work” (as do our other neighbors), but has Constitutional tax and spending protections, no Davis-Bacon prevailing wage law, and has legalized and taxes marijuana.

Making New Mexico’s high unemployment rate even worse is the fact that, as the Albuquerque Journal noted recently, the proportion of New Mexicans working relative to the population is the lowest its been since the Bureau of Labor Statistics started measuring back in 1976.