SANTA FE -

January 15, 2013

GOVERNOR SUSANA MARTINEZ DELIVERS

STATE OF THE STATE ADDRESS

SANTA FE – The following is the prepared text of the State of the State Address delivered by Governor Susana Martinez from the chamber of the New Mexico House of Representatives on January 15, 2013.

Governor Martinez – 2013 State of the State Address

Lieutenant Governor; Senate President Pro Tem; Mr. Speaker; Democratic and Republican leaders; esteemed members of the New Mexico Legislature, especially the new faces; honorable members of the judiciary; former New Mexico governors; tribal governors; Senator Udall; Senator Heinrich; distinguished guests; the State?s first gentleman, my husband, Chuck Franco; and my fellow New Mexicans.

It is an honor to join you for the annual State of the State Address.

And while today?s mood is one filled with optimism and hope, it is also bittersweet.

There is one very noticeable absence from this chamber - a man whose legacy in this body endures - former Speaker of the House Ben Lujan.

The thoughts and prayers of New Mexico continue to be with the Lujan family.

It is a privilege to stand with you as we mark the opening of New Mexico?s 51st State Legislature and chart the course for this New Year - a year in which we must focus on making New Mexico more competitive.At a time of intense gridlock in Washington, DC, it is encouraging to reflect on the progress we have made together here in New Mexico.

Two years ago, we faced the largest structural budget deficit in state history. Skeptics said we could not balance the budget without either a massive tax increase or making deep cuts to classroom spending and Medicaid. But we came together, in a bi-partisan manner, and together, we proved the skeptics wrong.

For two years in a row, we compromised and passed good, balanced budgets. We protected critical priorities like classroom spending and basic healthcare for the most vulnerable. We protected childcare for working moms and school clothes for kids in need. And let?s remember that we accomplished all of this without raising taxes. Not only did we eliminate the deficit, we created a surplus.  This wasn't a Republican accomplishment or a Democratic accomplishment.

It was an accomplishment we achieved together.

The next year, we used those surplus tax dollars wisely. We put some in our state?s savings account, increasing our reserve levels. We used some to increase funding for education, targeting reading and early childhood initiatives. We used a portion of the surplus to cut taxes, to create more jobs by curbing the double and triple taxation in construction and manufacturing. And we provided a tax credit to help small businesses hire those who deserve jobs the most - our veterans returning from Afghanistan and Iraq.  

We have seen some encouraging signs in our economy. Tourism is on the rise, with more growth in visitors to New Mexico than was experienced in Arizona or Colorado. We are building our state's strongest-ever relationship with Mexico?s border governors, focusing on creating jobs by developing a border region near Santa Teresa. Major companies are once again looking at New Mexico, including two companies in the aviation industry that are relocating their headquarters to Albuquerque. The manufacturing sector is growing once again. In the last two years, New Mexico exports have doubled, amounting to more than 2 billion dollars, meaning that in one year, our export growth jumped from 38th to 3rd in the nation. While we still have much work to do, the state of our state is getting stronger.

But I've always promised to be straight with you. It?s my job to say when trouble is on the horizon. Allow me to take a moment to describe the challenge before us. The national economy is stagnant. It's hardly growing. And the federal government - on which our state has become so dependent over the years - is faltering, weighed down by $16 trillion in debt. 

While New Mexico has seen some job gains in certain private sector industries, there is no question that the number of government jobs is on the decline. Last year, New Mexico lost more than 4,800 government jobs, including 400 federal jobs in a single month. On top of that, many private sector companies that contract with the federal government have seen those contracts cut, costing us more jobs. Unfortunately, it doesn?t look like Washington, DC is going to solve the budget mess anytime soon. It?s the fault of both parties and it?s hurting New Mexicans.

I am committed to working with our delegation to protect our labs and military bases and fighting to avoid further cuts. Our labs and bases are not only important to New Mexico, but they are critical to the security of America.

However, with a federal government that is so far in debt, so dysfunctional, we'd be foolish to leave our state?s economy at the mercy of the next fiscal cliff in Washington. The opportunity to forge a new path and shape our own destiny is before us. It?s an opportunity defined not by decisions made in Washington, but by the hard work and ingenuity of New Mexicans. That means diversifying our economy and growing the private sector.

New Mexico has a lot to offer, but what we lack is a level playing field with surrounding states.

We are simply not competitive. I have always said that government doesn?t create jobs - businesses do. But I do believe government has an important role in ensuring a level playing field so that New Mexicans can compete fairly.

Unfortunately, right now the playing field is tilted against New Mexico and it?s pushing jobs to other states. We are in a global economy. Businesses will locate and grow where they have the best opportunity to succeed, get a fair shake, and find the best-trained workers without being overtaxed.

Our goal this session should be to make New Mexico more competitive, to level the playing field so that our small businesses can grow and put more New Mexicans back to work. There are essentially two areas on which we should concentrate - instituting a fair tax and regulatory structure and creating a world class workforce through common-sense education reform.

One way to make New Mexico more competitive is to lower the business tax rate from 7.6% to 4.9%, just as Arizona has done. Right now, we have the highest in the southwest. I?m not asking to take the rate to zero, as other states have done. I'm proposing a reasonable, balanced approach, and 4.9% puts New Mexico in the game.