New Mexico braces for budget crunch linked to oil prices

New Mexico braces for budget crunch linked to oil prices

SANTA FE, N.M. (AP) — The chairman of New Mexico's Senate Finance Committee warned Thursday that the state could be short on revenue by $700 million or more during the current fiscal year because of reduced income from oil and gas production and anemic corporate and sales tax receipts.

Smith encouraged state agencies to institute cost-saving measures and said that the Senate is considering severe changes to a budget for the coming fiscal year approved days ago by the Republican-controlled House of Representatives.

Falling revenue expectations are linked to low energy prices and New Mexico's dependence on oil and natural gas production to keep the government up and running.