The Pew Charitable Trusts

SANTA FE, New Mexico -- Following is the partial text of Gov. Gary Johnson's 2000 State of the State address:

Mr. Speaker, Mr. President, Honorable Justices of the Supreme Court, Members of the forty-fourth Legislature, distinguished guests, my fellow New Mexicans.

Some of what I am going to share with you today may sound familiar. That is because good ideas, common sense ideas will continue to be proposed. Prior to the important work you have to do this session I am taking this opportunity to detail for you the status of our state government departments today. This information is important so that you and I can work together on the best ideas for the future.

All of us gathered together here today, in this great chamber, are blessed with the high honor and great duty to lead New Mexico into this new century. While we may not always agree on every issue, we do share the same goal: improving the quality of life of our citizens.

In order to always improve that quality of life we must focus our efforts on improved education, economic development, government efficiency, and reduced crime. These four strategies will enable New Mexico to build upon our past, strengthen our present and secure our future.

Improving education for our children is "priority one" for all of us.

With respect to this priority, our goal is the same to dramatically improve the academic performance of our schools.

In fact, many of our strategies are the same and they will work; higher academic standards, more testing, and greater accountability for results. We have invested over 1 billion dollars a year on kindergarten through 12th grade. New Mexicans need to know that we cannot continue to put more money into a system that is not accountable for results.

What is missing from public education is not money; what is missing is competition and choice. Just give school choice to parents. Let them send their child to any public, private, religious or charter school — any school, anywhere in New Mexico.

Legislation that provided for vouchers was defeated at the special session last May. That legislation will again be introduced later this afternoon in the House and in the Senate. I urge you to debate and adopt this legislation. Provide all parents the freedom to choose any public, private, religious or charter school for their child. I call on you to support the heart and soul of real educational reform, which is school vouchers.

Let me suggest five additional accountability measures to help all public schools in our state.

• First, adopt program and performance based budgeting to track the return on investment. Take the Bloomfield School District's lead and tie the budget to performance.
• Second, enact merit based teacher pay. Reward those teachers who are outstanding because they are doing what is best for kids.
• Third, amend the Instructional Materials Law to enable local schools to purchase what is needed for student success.
• Fourth, expand school testing. We are currently testing those students in grades 3 through 9. Let us test the children sooner and include kindergarten through second grade in that mix.
• Fifth, complete the State School Accountability system which is critical to improving our schools. Currently, 20 of the 89 school districts are able to provide data to the public that details how their schools are performing. We need to complete this system this year and make this information available, so parents can compare where each school, within each district ranks. Schools have to know where they stand today so that they can reach and set the goals for where they want to be tomorrow.

Let us "do what is right and fair" for all parents and students, let us improve student academic performance statewide. Let us make school choice a reality for the children’s sake.

Economic Development is the second strategy to improve our quality of life.

The Economic Development Department is working hard to attract more business to New Mexico. It is time to turn our dreams to reality. New Mexico has long been a place to dream, to innovate and to explore. It must become a place to grow, to expand and to profit.

We are seeing the dreamers find their homes here as new Biotech and Biomedical companies bring new products into the marketplace. Cell Robotics, an Albuquerque company, is today marketing laser based testing equipment for diabetics. Phase One Molecular Toxicology is finding new ways to examine how our bodies accept or reject lifesaving drugs. Emcore is building solar cells to power satellites in space. Muse Technologies is finding a way to give astronauts experience in new worlds through virtual reality. Our small business dreamers are already here. It is our job to help them turn dreams to reality.

Our tax policies must encourage dreamers and builders to stay in New Mexico as their companies grow. Our infrastructure policies must give them a home in any part of our state. We must give them the economic tools they need to prosper.

In New Mexico, our room to grow and room to dream must now be linked by an infrastructure that can allow us to turn our economic dreams into business realities. We must open the markets for telecommunication competition and we must invest in the construction of our telecommunications backbone.

That backbone will allow a 70-year old living in Truth or Consequences to access the telecommunications tools he or she needs to be a financial consultant in Asia and allow young Navajo weavers living near Shiprock to market their blankets in Europe. High skills equal high wages. Long term job security requires lifelong learning. The new economy demands a highly skilled workforce. Our workforce development proposals will enable every New Mexico workers dream to become an everyday reality.

Indian Gaming has provided economic development for the tribes and pueblos of New Mexico.

In addition to providing the tribes with economic self sufficiency, which has allowed them to develop projects from water systems to improved housing, Indian gaming has employed a number of New Mexicans, both Indian and non-Indian. We are currently in the process of negotiating changes to Indian Gaming Compacts which will provide the state and the tribes with certainty and stability. Such a negotiated resolution is preferred over the uncertain scenario which will result from a legal confrontation.

The State Taxation & Revenue Department has to efficiently impose, collect and distribute revenues and then convert those revenues into services.

Never more than now, has the Taxation and Revenue Department struggled to meet that mission. Despite budgetary constraints and a growing customer base, our Tax Department has increased its audit assessed dollars by 47 million dollars and almost tripled its taxpayer assistance outreach. Over 3.8 billion dollars are processed through this agency annually. Over 800,000 tax returns were processed faster this year than ever before. This can be credited to an increased usage of electronic filing which was pioneered by our Tax Department. Internet filing will expand this year to include refund express returns for personal income with automatic bank deposits for an even faster refund return time. Business filers will also be able to file electronically this spring. The Motor Vehicle Division handled an increase of over 480,000 new transactions without an adequate budget increase. The State Board of Finance committed 167,000 dollars in emergency funding for MVD. Now, your support will be needed for the remaining projected shortfall.

Tourism is a Foundation for our New Economy.

The Department of Tourism has continued with successful advertising and publicity campaigns, with big plans for the new century. Tourism is our second largest industry, employing some 74,000 New Mexicans statewide. The Legislature worked with the tourism industry to infuse the department's coffers with an additional 2.9 million dollars in advertising. It has worked.

The department has seen a 26 percent increase in inquiries this year. Our nine visitor centers have shattered previous records, serving more than 700,000 customers, the most since 1993.

The department is also asking New Mexicans to "Come Out and Play" with its statewide ad campaign, designed to entice residents to stay here during their vacations. Internet use is skyrocketing, netting about 50,000 inquiries more than the last five years combined. At the departments newly designed Web site, visitors can electronically plan their vacations, and we can help them at just seven cents an inquiry. One big reason people visit our state is its scenic beauty. We have to keep New Mexico beautiful, and the Department of Tourism has launched a litter awareness campaign, "Dont Trash New Mexico," to insure that scenic beauty.

The New Mexico's Highway Department is building prosperity that will positively impact our future.

At this very moment, you are witnessing the most concentrated improvement to our transportation system in the state's history.

The Highway Department's strategy of focusing both construction and maintenance on entire corridors translates into the first decrease ever in the number of bad highways that our citizens must drive on. Four lane highways are being built across New Mexico to bring economic opportunity to rural areas. They are also a lot safer to drive on. Major projects are being built in every metropolitan area to ease traffic congestion.

Today the Highway and Transportation Department has over 800 million dollars of construction underway. This is three times the traditional building program, and they have done it with thirteen percent fewer employees than five years ago. Also, they are delivering a better product in a shorter time and at a more reasonable cost. New Mexico has become a national leader in transportation.

The New Mexico Department of Labor is Providing a Trained Workforce.

In 1998, legislation was enacted which reduced unemployment taxes for New Mexico employers and increased benefits for eligible workers.

Our Department of Labor is now proposing an additional unemployment insurance tax reduction that will save New Mexico employers an additional 20 million dollars during the first year, and another 30 million dollars the next year. On top of this, benefits will be increased.

The enactment of the New Mexico Workforce Development Act, along with federal legislation, will consolidate more than sixty federal training programs. Under this new law our state and local governments will now determine how to spend these training dollars rather than the federal government. Across the state, employers and employees will have "one stop shop" centers that will give access to services and allow workers to apply for jobs and get training in one location.

The Energy, Minerals and Natural Resources Department manages state resources.

For the past five years, the number of visitors to our 31 state parks has steadily increased. In the last year alone, five million people enjoyed our parks. That is an average of approximately 14,000 people a day. We have made significant improvements, from constructing visitor centers with state of the art exhibits and installing new boating docks at our lakes to building trails with interpretive signs and we plan to do even more this year. I have designated the year 2,000 as the Year of State Parks.

Our economy also depends on our ability to develop natural resources in our state. We must continue to develop, yet conserve our natural resources. We have streamlined the permitting process and eliminated paperwork. By moving to the Internet we can begin to accept industry applications on-line, which would significantly reduce the amount of time it takes to render decisions. Today, extractive industries are doing business in our state in a regulatory climate that minimizes burdens and protects the environment. The oil industry was able to survive last year's plunge in prices. Through the tax incentives this forty-fourth legislature passed we have insured that this important industry could remain a vibrant part of our economy. We have certified 13,485 producing wells as eligible for the stripper well incentive. Equally helpful, the reduction in taxes should guarantee that thousands of marginal wells continue producing for a long time to come. And we will soon complete the process of certifying the 600 new wells eligible for the "new well" incentive. Millions of dollars from this new production will benefit industry, local economies and the state treasury.

When it comes to our environment, we have to clean up the past, protect the future and sustain economic growth.

My environmental philosophy is quite simple: move aggressively to clean up contaminated sites, and work with business to prevent new pollution. This work has been, and will continue to be accomplished without the relaxation of any environmental standards. Instead, our Environment Department is developing creative new strategies for improving environmental quality in New Mexico.

While issuing permits and taking enforcement actions are the traditional activities performed by this agency, new initiatives have been created and are making a difference. The Department's Green Zia Environmental Excellence Program takes a practical approach to helping companies prevent pollution. This year, I recognized 22 companies for their achievements through this program.

The Environment Department has also taken a strong leadership role in the implementation of new ways for solving water-related disputes. Through my signing of Executive Order 99-33 this fall, I encouraged the use and adoption of these collaboration-based principles. As an initial effort, the department recently hosted "Water Summit One" which was attended by over 200 individuals involved in water issues.

The Office of the State Engineer is focused on managing water and sustaining economic growth.

The primary responsibility of the State Engineer's Office is to adjudicate and allocate water, one of our most limited and valuable resources. This year, a new hearing unit has been established. There are now full time hearing officers and support staff to handle protested water right applications. As a result, significant progress has been made towards reducing the backlog of water rights applications. In October 1998, there were 3195 applications backlogged. In October 1999, there were 855 cases remaining. New technology has been directed towards the adjudication of water rights in the Lower Rio Grande. The use of Global Positional Satellites (GPS) and a Geographical Information System (GIS) has all but eliminated older surveying techniques formerly used in making a hydrographic survey of irrigated acreage. The office has also begun a major computerization endeavor. A comprehensive database is being developed to store and image the office's extensive water right files, some of which are over a hundred years old and date back to before statehood. Future water shed management can hold the key to enhancing water yield and water quality.

The Endangered Species Act is raising significant challenges for the state's Water Code. Collaborative principles are being utilized in order to balance environmental concerns with the requirements of our state's Water Code.

The Regulation & Licensing Department is geared for economic results.

Focus has been given to providing the taxpayer the best possible service at the lowest possible price. This has resulted in a nine percent decrease in employment levels at a time when the volume of work has been increasing. Employees have responded by improving their work processes, including the effective use of technology and outsourcing certain functions. By focusing resources in areas that have the greatest impact for our customers we have demonstrated that government can be a partner, that we can listen to their concerns and that we can improve.

One of the most exciting things happening at the Regulation and Licensing Department is their conversion to new licensing software that will dramatically improve the licensing process throughout the department. But more importantly, it is the first step in establishing the capability to perform licensing via the Internet. In conjunction with this innovative use of technology, I will be asking all the boards and commissions to review and revamp their rules and regulations that govern the licensing process for their profession. The goal will be to shorten the amount of time it takes from the date of application filing to the issuance of a license. The more efficient we can make this process the more we act as partners to the industries we regulate.

The Office of Cultural Affairs is insuring our rich heritage and a bright economic future.

The Office of Cultural Affairs has concentrated its efforts on expanding the public's access to museums, historic sites, educational programs, library services, research and preservation activities, community support programs, and electronic information systems available on the internet.

From the construction of four lane highways and the building of information superhighways, to the installation of one-stop-shops for lifelong training and the satellite mapping of our water resources, New Mexico is building upon our existing economic foundation. From electronic filing of mining permits and business tax returns, to the Green Zia Excellence Awards and the renovation of state parks. New Mexico is strengthening the economy of today. From new museums, to new uses of the Internet and new tourism advertising, New Mexico is securing a bright economic future.

The third strategy to improve our quality of life is to reduce crime in New Mexico.

Crime control by controlling criminals is becoming a reality. For the last 22 years, the operation of the New Mexico Corrections Department was under the control of the federal courts. This past summer, the department vacated the Duran Consent Decree. Corrections is now controlling its own destiny and has closed the faucet of millions of dollars in taxpayer moneys flowing to inmate attorneys.

Never again should overcrowding be the excuse to allow turnstile justice in New Mexico. We have added more than 1800 beds to lock up criminals. The new prison beds allow the state to end "good time" for violent offenders. Inmates now serve 85 percent of their sentence for violent felonies committed against our citizens. The Corrections Department has reduced the cost of incarceration for New Mexico inmates on a per capita basis.

This past year we have all seen the dangers of prison violence at both public and private prisons. The state must punish those inmates who commit crimes behind bars. They must be held accountable. The key to gaining control of inmate violence and prison gangs is the establishment of a Super-Max Security Prison. Dangerous predatory and disruptive inmates will have less opportunity to prey on our citizens, our correctional officers, and other inmates.

New Mexico's corrections system and the issues they face are always changing. We have built a strong foundation on which to continue to operate safe, secure and sound correctional programs for the benefit of all New Mexicans.

Public Safety is one of the core functions of Government.

Their responsibilities range from keeping our streets free of criminals to providing emergency assistance to communities and our citizens in times of need. To have safer streets we need more officers on those streets and we are actively pursuing our recruiting efforts to fill the 90 expansion positions that have been allocated. A key concern in this area is currently the 60 hour college credit requirement which makes it difficult to find qualified individuals. In that light, I am proposing legislation which would allow for a limited exemption with respect to this requirement.

In summary, the state of the Department of Public Safety is good. The transition under the new Cabinet Secretary, Nick Bakas has been smooth and the reaction positive. From the ending of the Duran Consent Decree and the completion of hundreds of new prison cells, to the hiring of more state police and the implementation of new truth in sentencing laws, New Mexico is building upon our past, strengthening our present and securing our future.

The fourth and final strategy to improve our quality of life is to focus on government efficiency.

We have to continue to offer government services at the best prices. The Department of Finance and Administration has overseen this mission. As we approach the 2000 Legislative session, the State's finances are in a much-improved condition. Reserves are now 5.7 percent of the current spending level. Due to prudent management of the overall spending level, the state has weathered a slowdown in the rate of revenue growth. New money for the coming session is expected to be 144 million dollars or 4.4 percent over the prior year's spending level. This is enough revenue to permit a modest income tax cut while still funding the essential functions of state government at an adequate level. I will recommend the following priorities in allocating new money:

There needs to be a tax cut!

In designing the budget for FY 2001, significant tax relief in both Personal Income Taxes (PIT) and Unemployment Insurance (UI) taxes are realized. I'm proposing that Personal Income Taxes be cut by 65 million dollars per year through a series of three steps: a 15 million dollar cut in tax year 2000, a 20 million dollar cut in tax year 2001, and a 30 million dollar cut in tax year 2002. The total cut will represent over 100 dollars per taxpayer per year.

My budget recommendations were developed by applying the following five principles:

First, we must adequately fund the entitlement programs and other caseload-driven programs that have been seriously under-funded in past budgets. Examples of such programs include: adult prisons, Medicaid and the Public Defender's office.

Second, we must restore adequate funding to those agencies whose budgets have been cut with no corresponding reduction of responsibilities. Examples of such agencies include: State Parks, the Motor Vehicle Division and others.

Third, we must recognize commitments made in previously passed legislation that have not been adequately funded. Examples of such commitments include: State Police Officers, the Hispanic Cultural Center, and the Dona Ana County facility for the Children, Youth and Families Department.

Fourth, we should allocate available funds to primary and secondary education in such a way as to encourage serious reform and accountability measures.

Finally, we should hold all other agencies to limited growth while accommodating increased insurance expenses and annualizing this year's pay plan increase. In addition to operating funds, we have approximately 192 million dollars available for capital outlay funding. I recommend that these funds be allocated to essential infrastructure projects including public and higher education facilities, adult and juvenile correction projects, public building repairs and other statewide projects.

The Executive budget recommends: 38.8 million dollars of supplemental and special appropriations during the current fiscal year and 14.9 million dollars of non-recurring appropriations is recommended for fiscal year 2001 for computer enhancements and capital outlays. Under these recommendations, the reserve balance at the end of FY 2001 would reach 172 million dollars or 5 percent of recurring appropriations. Experience has shown that we must maintain this level of reserves to insure our future ability to meet the state's essential functions.

In order to improve the efficiency of state government, my administration has been working with the Legislature to implement "performance-based budgeting." This approach aims to improve the targeting of state spending on our highest priorities. Specific standards for performance are being developed. The goal is to make the budget more logical, useful and goal-oriented. My administration will work to insure that the results of this effort serve as the basis for a more efficient and productive state government.

The General Services Department is responsible for servicing all of state government.

They provide everything from buildings and maintenance to computers and communications; from providing our employees with health insurance to insuring the state through risk management.

Many of GSD's efforts in providing these services have produced innovative solutions, which have not only saved money, but have provided more efficient governmental operations. For example, their civil rights training incentive program has saved many state agencies the amount of premiums they pay for insurance but more importantly it has reduced the number of civil rights claims through improved working environments for our employees. On a statewide level, GSD was also a participant in the award winning Questa communications project, using the state microwave system to provide internet access to local schools, government, and medical services.

The Procurement Assistance Program helped 711 small and minority businesses in New Mexico secure contracts with state and national governmental agencies. GSD's innovative attitude will continue in the future with a number of initiatives they plan to pursue:

• Pursuit of funding for the State Microwave System conversion to support public safety and enhancement of telecommunications systems in rural New Mexico,
• Promotion of Capitol Buildings Planning Commission objectives of efficiency and cost reduction through building ownership and departmental consolidations; and
• Implementation of a substantial transportation rate reduction for state vehicles. Because of these innovative ideas which reduce the amount of money we must expend to provide typical government services, we have been able to use many of your tax dollars in areas such as education and highway construction.

The Chief Information Officer focused on three major issues in 1999:

• Improved Information Technology management
• Use of the Internet for direct electronic service delivery
• The risk of Year 2000 failures in state service delivery

In order to improve Information Technology management in New Mexico state government, the CIO has addressed major information technology issues in state government.

The CIO improved agency awareness of the emerging impact of Internet service delivery. Most agencies now have their own web pages providing information to the public, two agencies are accepting applications or filings over the Internet, and agencies are rapidly developing e-commerce applications.

The CIO's Office led the effort to minimize New Mexico Government service delivery interruptions during Year 2000 transition. They tracked 300 agency-specific mission critical systems and 23 major statewide service delivery systems. They provided consulting to agencies and oversight for both Executive and Legislative branches of Government. New Mexico citizens experienced almost no service delivery interruptions during the millennium transition.

State Personnel is building a dedicated civil service system.

The state employee workforce represents a huge investment in human capital as well as the greatest single expenditure in agency budgets.

The Personnel Board seeks to "bring greater economy and efficiency to the management of state affairs."

For the past five years, the State Personnel Office has made steady progress in this effort by simplifying its rules and regulations; changing to recruitment by real-time vacancy; pushing decision making down to the agency level; and instituting pay-for-performance as the reward mechanism.

The next step is a comprehensive redesign of the classified employment system. This massive project which will be completed and implemented in July 2001, will provide our state workforce with state-of-the-art mechanisms to support the kind of productivity that we all demand from our public servants.

From low growth budgets and high fiscal reserves, to multi-year tax cuts for both individuals and industry, New Mexico is building upon its past. From performance based budgeting personnel reforms, to procurement code reforms and a proposal to invest 200 million dollars in capital outlay, New Mexico is strengthening our present and securing our future.

In addition to these four strategies, healthy and strong families remain the foundation for an improved quality of life.

The Children, Youth & Families Department's mission centers on helping preserve New Mexico families and protecting our communities. New Mexico's foundation is the family. More than anything else, families contribute to both our successes and failures as a state.

Another concern for CYFD is the thousands of New Mexico children who are abused and neglected. On any given night, more than 2,500 children go to sleep in a foster home. Two hundred and fifty of those children will never be able to return to their homes because they are unsafe. CYFD has initiated an aggressive campaign to recruit more foster and adoptive parents. There is nothing any of us could do that would be more beneficial to the health of our state than promoting the need for foster and adoptive families. If any of you are interested in becoming a foster parent, please call the Children, Youth & Families Department.

CYFD promotes community safety by operating the juvenile justice system. Rehabilitation is more successful in young people than adults. CYFD has worked to reduce overcrowding in juvenile facilities to improve the program and educational environment. More one-time delinquents are graduating from high school and receiving their GED than ever before. The addition of the new medium security facility in Dona Ana County will improve CYFD's ability to provide a quality education to juvenile offenders.

Human Services is providing a helping hand to those families in need.

The major change of the last decade that we must face has been the transfer of responsibilities from Washington to the states for programs such as welfare, child support and food stamps.

One key to solving our welfare problems in New Mexico rests with the Human Service Department's Child Support Enforcement Division.

Child support cases have climbed from 85,000 total cases to 105,000 in the last year. Single parents not receiving child support payments are much more likely to end up among our welfare population. Accordingly, the Human Service's budget request proposes money that will enable us to eliminate this backlog.

Efforts to pursue arrangements with tribal organizations wishing to establish their own child support enforcement units are progressing. The Navajo program is up and running, and is, by national standards, considered a model.

Even under the best child support scenario, we still must get Temporary Assistance for Needy Families (TANF) clients to work well before their lifetime eligibility expires. This plan is already well underway and preliminary results are promising. Six months into the program, over 2500 clients have found jobs.

A wage subsidy program to place TANF recipients into private sector subsidized wage positions is also at hand. We will pay half of the employee's wage for 6 months and would expect the employer to hire a successful participant thereafter. Already we have had some success in placing individuals into public and private sector jobs through this program.