Gov. Susana Martinez said New Mexico’s unemployment compensation trust fund should remain healthy through 2012, more than 12 months longer than originally projected.
The state is currently paying $745,000 a day in jobless benefits from a fund that had a balance of $129 million in early July. The fund totaled $500 million in July 2008.
The 2011 Legislature passed a higher tax rate on employers to replenish the unemployment effort and cut benefits, but Martinez vetoed the tax while letting the lower benefits go into effect.
Several legislators asked the state Supreme Court to declare the partial veto as unconstitutional. The court said last week it would not rule on the suit until after a special legislative session this fall that will focus on redistricting.
If the veto is not resolved by the court or the Legislature, in January 2012 New Mexico will not have a state-mandated employer tax rate dedicated to the unemployment trust fund. If that happens, the Workforce Solutions Department would have the authority to set the tax rate.
When lawmakers approved the higher rates, officials said the fund would be drained by March 2012. Last week, the workforce department said the fund would be solvent through March 2013 at the current tax rate even if joblessness remains high.
If the lower rate remains in effect, the unemployment fund would have a balance of $28 million at the end of 2012. If the veto is overturned and the higher rates go into effect, the fund would have a balance of $113 million.
The higher rate would increase the average payments by an employer for each worker by $167 to $492 a year in 2012. The annual tax would go to $582 per employee per year in 2013 due to an automatic rate-setting mechanism.