Steve Fischmann
Advertised as giving a leg up to returning vets from Iraq and Afghanistan, two bills we passed during the recent session will instead waste millions on subsidies and tax breaks to businesses that don’t need them.
Did you ever send in a rebate coupon on a store purchase and never receive the money you were promised? It’s infuriating to be deceived, and insulting to be disrespected, especially when what was promised to you winds up in the hands of people who don’t need or deserve the money.
That New Mexico should single out those who have made the greatest sacrifices for our country for this kind of treatment is a disgrace. Yet that is what the Legislature has done by passing HB 97, the New Mexico Veteran Business and Contractor Preference, and HB 10, the Veteran Employment Tax Credit, during the 2012 legislative session. Along the way, we have demonstrated much of what is wrong with our current political process.
Advertised as giving a leg up to returning vets from Iraq and Afghanistan, these bills will instead waste millions on subsidies and tax breaks to businesses that don’t need them.
HB 97 was sold as helping returning vets get established in business by granting 2-5 percent bidding preferences to veteran-owned businesses competing for contracts across state government. Unfortunately, the law does nothing to distinguish returning veterans from veterans that already have established successful businesses. Millions could be spent on subsidies to established business owners who need no help.
Even worse, non-veteran-owned companies will game the law to hijack veterans’ preference money. They will finance shell corporations naming a veteran as the owner, and the shell companies will subcontract the work back to the existing non-veteran owned company. It’s not hard to see unscrupulous operators lining up to soak the government on this one. Not only will this law do little to help honest returning veterans, we will dishonor their name with a taxpayer rip off.
Why the bills passed
HB 10 proposes to incent business owners to hire veterans by offering a $1,000 tax credit for each veteran hired. In practice, the tax credit is too small to have a significant influence on hiring decisions. Employers will simply take the credit on veterans they would have hired anyway, and once again little benefit will accrue to the heroes the legislation purports to help.
Unfortunately, I voted yes on this bill. I wish I could take that vote back.
These bills passed because no legislator wants to face charges in the upcoming election that they voted against veterans. HB 10 passed unanimously through both houses, and I was the only no vote on HB 97. Many legislators did not understand or have time to consider how these bills would actually work in practice. They were presented as routine housekeeping on the Senate floor during the crush of bills that were held back until the last two days of the session.
In addition, the objective legislative analysis that is supposed to come from the legislative finance committee utterly failed to highlight the relevant issues in the case of HB 97. HB 97 was analyzed as having minimal to no cost. How the government can pay an additional 2-5 percent preference and incur no cost remains a mystery to me.
Veterans and taxpayers deserve effective policy
Assisting returning veterans is a goal worthy of our investment. If we truly wish to help them find a place in our economy we should enhance their educational, job-training and job-placement benefits rather than shelling out money to businesses that may not have their best interests at heart.
Hopefully we will fix or repeal HB 10 and HB 97 in the future. Political gestures that create the illusion of helping vets not only dishonor our heroes, they cost taxpayers a bundle.
Veterans and taxpayers deserve better than deceptive and possibly corrupt politics. They deserve effective policy.
Steve Fischmann, a Democrat, represents the Las Cruces-area District 37 in the New Mexico Senate.