Billions of dollars sitting in state accounts, state auditor says

A statue outside the Roundhouse in Santa Fe.

Heath Haussamen / NMPolitics.net

How is it even possible that state Auditor Tim Keller claims billions of dollars sit idle in state bank accounts when some of it can be used for construction projects around New Mexico? It’s complicated.

Visitors to the state Capitol this legislative session often joke that if they drop a coin anywhere in the building a state lawmaker might very well be behind them ready to sweep it up.

With falling revenue and an austere state budget, lawmakers and officials with Gov. Susana Martinez’s administration are scouring state funds for any unspent money that can be used to pay for general government services.

So how is it even possible that state Auditor Tim Keller, in a report released Friday, claims billions of dollars sit idle in state bank accounts when some of it can be used for construction projects around New Mexico?

It’s complicated.

Keller, a former state senator who was elected as state auditor in November, 2013, has itemized the unused funds in state accounts for the past two years.

“The Fund Balance Report shines a light on unspent dollars that were allocated by the legislature and collected by agencies in years past for a particular use,” Keller wrote in his report. “Unfortunately, there was little year-to-year progress in getting these dollars out into the economy. With our state desperately in need of jobs, this is an opportunity for the administration to prioritize getting these dollars moving, to spend these funds as intended on roads, schools, and water projects.”

Keller acknowledges that many of the funds are earmarked for a specific use and “there are legitimate reasons why some funds may not be spent, including the need to maintain reserves, insurance and bonding requirements, and inevitable delays of certain projects due to uncontrollable factors.”

But the analysis, he said, brings more transparency to the accounting of state agencies and where dollars are being parked.

For instance, the report points to $291 million in a loan fund for local waste-water projects; $4.7 million set aside for abandoned mine cleanup; $215 million paid by businesses for unemployment insurance claims; $1.5 million to purchase public art for buildings; $5.2 million generated by state prison inmates who are in job programs.

The largest categories of unspent money include revolving loan and grant funds ($574 million); business and enterprise funds, which includes self-insurance money ($1.4 billion); and money for water-related projects ($230 million).

But the biggest chunk is money that was appropriated for capital outlay projects but never spent, which totals $1.2 billion, according to Keller.

Democratic senators wasted no time on Friday saying that most of the unspent capital outlay dollars are statewide projects under the jurisdiction of the governor.

“Money sitting there unspent doesn’t help the economy,” said Sen. William Soules, D-Las Cruces.

“These are statewide projects,” said Sen. Cisco McSorley, D- Albuquerque. “It’s her projects that aren’t being spent.”

Lawmakers are not suggesting the capital funds be swept into the operating budget, just that it be spent as intended to boost jobs and the economy.

Every year lawmakers apportion money for capital outlay projects across New Mexico. Some are allocated for specific districts and included at the request of lawmakers. Others are included at the request of executive agencies as the state engineer or the Environment Department.

Some projects require matching money, so capital outlay funds are set aside as a condition of getting federal assistance. This is true with tribal projects, infrastructure and rural development projects.

Others are supposed to be shovel ready but get delayed for planning or permitting reasons. Still others are included at the request of lawmakers but may be opposed by the local community — such as money in Santa Fe for development of county fairgrounds.

The Senate is considering a bill introduced by Sen. Joseph Cervantes, D-Las Cruces, to revert all unspent capital outlay balances from 2013 and preceding years. Under that measure, money from some $57 million of projects around the state would be reverted and any unspent money used to pay off bonds.

The bill (SB 227) is pending in the Senate Finance Committee.

An email inquiry sent to the Martinez administration about unspent capital outlay projects under her authority was not answered.

Contact Bruce Krasnow at (505) 986-3034 or [email protected].

This BBSNews article was syndicated from NMPolitics.net, and written by Heath Haussamen. Read the original article here.