The Latest: New Mexico Capitol encircled by education rally

SANTA FE, N.M. (AP) — The Latest on efforts to resolve a New Mexico state budget crisis (all times local): 4:00 p.m. A rally in support of greater state funding for public education in New Mexico has drawn hundreds of teachers, parents and students to the state Capitol. Sign-waving protesters paced around the circular state Capitol building on Thursday to chants of "no more cuts" and "save our schools." Santa Fe Public Schools Superintendent and former state education secretary Veronica Garcia canceled classes at mid-day so that staff and students could attend the rally and urge lawmakers and the governor to bolster spending on K-12 schools for the coming school year. Garcia is urging Republican Gov. Susana Martinez to reconsider a pledge not to raise taxes. Lawmakers have until Saturday at noon to approve a budget. The state cut public education funding in October and this year swept funding from school district reserves to plug a current-year deficit. ___ 11:50 a.m. A proposal to increase New Mexico's tax on cigarettes to $3.16 a pack to boost funding for public schools has voted down by a panel of lawmakers. The House Taxation and Revenue Committee on Thursday voted 9-5 against the Senate-approved tax increase on a variety of tobacco products including electronic cigarettes. The tobacco tax was not part of a broader Senate-approved budget plan that slightly increases education funding. Democratic Sen. and bill sponsor Howie Morales of Silver City says that sidelining the tobacco tax makes cuts to education more likely as the state grapples with slumping tax revenues from current sources. His proposal would have raised $89 million next year. Lawmakers on the taxation committee expressed concern that raising tobacco prices would foster black-market sales. Republican Gov. Susana Martinez has vowed to veto any outright tax increases. ___ 8:50 a.m. A proposal to increase New Mexico's tax on cigarettes to $3.16 a pack has been approved by the state Senate. Senate Democrats backed the $1.50-a-pack increase Wednesday over Republican objections on a 24-16 vote. The bill now moves to the House. The initiative would raise an annual $89 million for public schools, as New Mexico lawmakers wrestle with a budget shortfall for the coming fiscal year. Republican Gov. Susana Martinez has vowed to veto any outright tax increases while considering changes to credits and deductions. The bill from Democratic Sen. Howie Morales of Silver City would raise taxes on other tobacco products including electronic cigarettes to 75 percent from 25 percent. E-cigarettes heat a nicotine liquid into a vapor, delivering the chemical that smokers crave without harmful tar from burning.