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County discusses economic development

Signpost staff

The Sandoval County Commission convened on February 19 to discuss an Economic Development Strategic Plan, as they do not currently have a formal plan. With the county still reeling from the 2008 economic collapse—especially the collapse of the Rio Rancho real estate market and disastrous development plan—they could probably use one.

At the meeting, Economic Development consultants made suggestions. The county has not yet chosen to hire a consultant for economic development strategies. Mark Lautman, one of the consultants, estimated that if the county is to be viable, it needs to create 745 net jobs per year for the next ten years. Lautman estimated that the state had lost 50,000 jobs from 2008 through 2011, and a thousand more could go if the federal government follows through with imminent spending cuts.

New Mexico State University professor Joel Dieme suggested that it is not a matter of attracting outside companies into the county, but developing existing enterprises, such as agriculture.

 At the meeting, everybody admitted that, economically, the county is getting worse in every area, that it’s population is aging, and that there’s more poverty.

Other than Commissioner Don Chapman of Rio Rancho, the Commissioners did not express enthusiasm for spending time and money on planning, but committed themselves to discussing these issues during a March meeting. County Manager Phil Rios suggested that a task force might be appointed to draft a plan. After the meeting, Chapman told the Albuquerque Journal of his concept of using interest accumulated from property tax—before the funds are distributed to two hospitals in Rio Rancho—to create an economic development fund.


New Mexico’s poorest pay more in taxes than wealthiest

—Sharon Kayne, New Mexico Voices for Children

New Mexico’s lowest-earning families pay state and local taxes at a rate more than double that of the highest-earning households. That’s according to the report, Who Pays? A Distributional Analysis of Tax Systems in All 50 States, released on January 30, 2013, by the Institute on Taxation and Economic Policy (ITEP).

The numbers for NM show that households in the bottom fifth earning bracket pay 10.6 percent of their income on state and local taxes. Those in the top one percent pay just 4.8 percent of their income for those same taxes.

“New Mexico’s tax structure has become more regressive over the years, particularly since the income tax rate for the top bracket was cut in half in 2003,” said Gerry Bradley, Research Director for New Mexico Voices for Children. “Sales taxes have always fallen hardest on those with the lowest incomes because they must spend virtually all of their income on day-to-day necessities, where as those in the higher income brackets are able to set some aside in savings.”

In fact, sales and excise taxes show the largest rate gap—with the lowest twenty percent of households paying about seven times what the highest one percent pays. New Mexico has a gross receipts tax (GRT) rather than a traditional sales tax, but the amount is usually passed along to the customer, much like a sales tax.

“New Mexico used to have a fairly low, broadly based gross receipts tax and, coupled with a more progressive income tax structure, that made the overall system much more fair,” Bradley said. “But over the years we’ve enacted numerous exemptions, which meant raising the GRT rate to make up the difference.”

Two other recently released reports also paint a dismal picture of life for New Mexico’s low-wage workers: New Mexico has the highest income inequality in the nation, and the highest rate of working families who are low income.

The report can be downloaded at: www.itep.org/whopays

 
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