On Monday, Gov. Bill Richardson ordered a freeze on capital outlay projects around the state. Unless local governments had contracts in place as of last Friday, projects will be put on hold.

The freeze, hoping to save the state $150 million in dormant projects, will be in place through the next legislative session beginning in January, Richardson said.

Anticipating the freeze, contracts for projects have been let throughout the state and may have reduced the possible saving to $50 million, according to Sen. Sue Wilson Beffort, R-Sandia Park, who is on the Finance Committee.

The city of Moriarty took action Tuesday night to do what it can to keep its allocated state funding for construction of a new Moriarty public safety facility and improvements to the current fire station.

The city awarded a $59,113 bid to B&R Construction for the fire station improvements, contingent upon negotiations with the company; and $148,144 to B&R and $40,380 to Magnum Steel for construction of the new city public safety facility to be located in Lexco Estates.

The city had been allocated about $260,000 in legislative appropriations for the new and upgraded facilities.

Torrance County officials also expressed concern at their regular meeting Wednesday. Legislative appropriations had been allocated to projects in the county, including the addition to the Esparanza Health Clinic in Estancia, and improvements to Torrance County and Torreon roads.

County Manager Joy Ansley said it was her understanding that the projects were frozen until further word from the state.

The decision by the governor came after state lawmakers adjourned a seven-day special session last Friday night after finishing a handful of bills to cover a $650 million budget deficit and sending the plan to Richardson. Richardson is now listening to constituents' reactions and has about two weeks to decide whether to sign or reject all or parts of the legislation.

The governor has said he remains weary of the budget cuts passed by the Legislature.

"I am deeply concerned that protecting capital outlay projects seemed to take priority over protecting people. The drastic cuts to state agencies will likely lead to dramatically reduced critical services, such as Medicaid funding for behavioral health care, children's health care and programs for the elderly. Layoffs are also likely under the Legislature's plan," the governor said last week.

According to Beffort, the governor tied the Legislature's hands. She said she expects the governor to line-item veto some of the biggest reductions in the budget, those upward of 7 percent, which were made to departments like economic development, tourism and cultural affairs.

Beffort also lamented the decrease in gas and oil revenues, which she said were brought on by a "pit rule" adopted in New Mexico that is designed to protect groundwater from wastes produced during oil and gas drilling operations. She said the restrictions have run the industry out of the state and exacerbated the recession.

Cuts to public education, the Children, Youth and Families Department, and Medicaid were included in the legislation to balance the state's $5.5 billion budget by using federal money to offset the cuts and giving school districts more financial flexibility for the rest of the school year.

The spending cuts passed by the Legislature would also require Richardson to reduce the salaries or benefits of 102 political hires, or exempt employees.

Rep. Rhonda King, D-Stanley, had a key role in the legislation, as she sat on the interim Legislative Finance Committee, and is vice chairwoman of the House Education Committee.

"Our goal was to keep the budget shortfall in mind, but also trying to have the least amount of reductions in education and critical services," King said Tuesday.

Transferring a $29 million appropriation to help school districts and charter schools pay for insurance premiums will free up district operational funds for other uses, such as salaries and benefits for teachers and other direct instruction costs.

King said the transfer of funds helped to keep education cuts to less than 1 percent.

"I believe we were responsible in our outcome," King said. "While we had some larger cuts in state agencies, I believe we were able to keep critical services intact."

Lawmakers estimate the Legislature will face another budget shortfall of at least $400 million for the fiscal year that begins in July, although some legislators believe that number could grow much larger.

"It's going to be a train wreck," Beffort said.