Barry Massey, File, Associated Press
FILE - In this Nov. 20, 2010 file photo, Rep. Ben Lujan, D-Santa Fe, speaker of the New Mexico House of Representatives, talks to the media after a meeting of the House Democratic caucus at the Capitol in Santa Fe, N.M. The winds of change continue to blow through the Capitol as the Legislature prepares to get back to work. Voters put a Republican in the governor's office and weakened the Democrats' decades-long control of the House. Looming at the start of the 60-day session is a leadership showdown in the House. But one thing won't be new when the Legislature convenes on Tuesday, Jan. 18, 2011. New Mexico's lingering financial problems remain the biggest challenge for lawmakers and the governor.

SANTA FE, N.M. — The winds of change continue to blow through the Capitol as the Legislature prepares to get back to work after voters put a Republican in the governor's office and weakened the Democrats' decades-long control of the House.

One thing won't be new, however, when the Legislature convenes Tuesday. The biggest challenge confronting lawmakers is New Mexico's lingering financial problems.

Plugging a $400 million hole in the state's budget is the top priority for lawmakers and Republican Gov. Susana Martinez during the 60-day legislative session.

"It's going to be a tough year and a tough session. People are going to have to get by with less money," said Senate Republican Leader Stuart Ingle of Portales.

Martinez succeeds Democrat Bill Richardson, who aggressively pushed the Legislature each year to approve his initiatives — some of which may be rolled back by the new GOP administration because of spending cuts.

Looming on the opening day of the Legislature is a leadership showdown in the House, where Speaker Ben Lujan of Santa Fe anticipates a challenge from Democratic Rep. Joseph Cervantes of Las Cruces.

"What I hope and expect is we're going to make things a little bit different in the state of New Mexico," said Rep. Andy Nunez, a Hatch Democrat who's been lining up support for Cervantes.

Republicans picked up eight seats in the November general election, narrowing the Democratic majority to 37-33 — the closest margin since the House was expanded to 70 seats more than four decades ago.

To win the top leadership post, Cervantes needs the backing of a coalition of Republicans and at least a handful of Democrats. A similar coup took place in 1979, when a "cowboy coalition" of Republicans and conservative Democrats ousted House Speaker Walter Martinez of Grants and replaced him with Lovington Democrat Gene Samberson.

House GOP Leader Tom Taylor of Farmington declines to say whether Republicans will support a coalition with Cervantes.

But regardless of who wins the speakership, Taylor maintains the House will be a far different place than when Democrats held a comfortable majority and could push legislation even if several of their members broke ranks.

"The big change is that we're fairly near even," said Taylor. "The result of that is I think you'll find the body a little more deliberative. There's certainly some power that moves from leadership to the individual when you have near splits."

Lujan acknowledges the potential votes are close in the race for the speakership, the most powerful position in the Legislature. He's held the job since 2001.

"It's going to depend on the membership on the Republican side," said Lujan.

The speaker largely controls the legislative agenda in the House and has broad discretionary powers in presiding over daily proceedings. Importantly, the speaker also appoints chairmen and members of committees, which conduct much of the work of the Legislature by approving and rejecting bills.

Because of GOP gains, about half of the committees in the House will have equal numbers of Republicans and Democrats. In others, Democrats will cling to a narrow advantage in membership.

"So in order to pass legislation, it's going to take a lot of ... cooperation and a lot of discussion and finally some consensus as to what legislation we all want to move forward," said Lujan.

Fixing the state's budget woes will test the ability of the Legislature to work with Martinez. The last GOP governor, Gary Johnson, battled constantly with the Legislature and vetoed hundreds of bills that Democrats wanted.

But Martinez said, "I am confident we will be able to work together."

The administration's budget proposals are close to what has been recommended by the Legislative Finance Committee. Both call for spending reductions of about 3 percent next year and no new taxes to balance the $5.4 billion budget.

Martinez has suggested larger cuts to higher education than the LFC, but more money for public schools and Medicaid, which provides health care to about a fourth of the state's population.

Senate President Tim Jennings, a Roswell Democrat, said Martinez "appears to be a very sincere, decent person to work with."

A lack of money for new programs and initiatives, he said, could foster more cooperation and less squabbling over the budget.

"This might be one of those sessions when everybody sits down and gets their jobs done and goes home," said Jennings.

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The budget won't be the only issue, however, and some are sure to stir fights in the Legislature.

Republicans want to scale back what they consider overreaching environmental and business regulations by the Richardson administration.

GOP members propose scrapping a law that establishes a mostly union "prevailing wage" for workers on taxpayer-financed construction projects. Martinez supports repealing a Richardson-backed law that grants driver's licenses to illegal immigrants and she's proposed scaling back a tax break for film production, which the industry opposes.

New Mexico Legislature: