State cash reserves hit zero as budget troubles mount
RED RIVER — Falling tax revenues have left a $654 million hole in the state budget, and New Mexico lawmakers learned Wednesday that the reserve fund for day-to-day government operations is completely drained.
That operating deficit includes a $223 million carryover from spending during the fiscal year that ended June 30, and a projected $431 million shortage for the 2017 budget year, now in its second month.
Legislative Finance Committee members heard the bad news from legislative staff and members of Gov. Susana Martinez’s Cabinet. The numbers were more dire than anticipated because the general fund reserve balance ended fiscal 2016 in the negative.
“We’re down to zero reserves,” noted Sen. George Muñoz, D-Gallup, who raised concerns about how the bleak fiscal picture will affect borrowing costs.
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