April 9, 1999

The Honorable Manny M. Aragon and

Members of the Senate

Executive-Legislative Building

Santa Fe, New Mexico 87503

Honorable President and Members of the Senate:

I have this day VETOED and am returning SENATE FINANCE COMMITTEE SUBSTITUTE for SENATE BILL 173, without emergency clause, with certificate of correction, as amended, enacted by the Forty-Fourth Legislature, First Session, 1999.

This legislation proposes the Student Alternatives Act to provide a pilot program to serve a small number of high school dropouts and at-risk students. Structured as a pilot program ending in five years, the Student Alternatives Act would have been funded with general fund appropriations.

The Student Alternatives Act, even as amended, includes many innovative education reform features: competitive solicitations seeking a variety of education services providers, administration of the program outside of the State Department of Education, the use of charter schools for profit and non-profit providers, and the use of performance contracting.

These are very laudable reform features that would increase school choice and accountability.

Unfortunately, the legislation is fundamentally flawed. It uses general fund monies rather than the state school funding formula and the funding goes to a department, a board and a contractor rather than the "money following the child." In addition, the scope and the scale are far too small, targeted only at dropouts and structured as a five-year pilot program. Finally, the contractor must comply with numerous provisions of the Public School Code and rules of the state board of education.

Consequently, this legislation qualifies as yet another small step toward incremental school improvement at a time when New Mexico must make quantum leaps in education reform. I urge

the sponsor of the bill and all those who supported this legislation to redouble their efforts and submit true school choice legislation at the next legislative session.

Sincerely,

Gary E. Johnson

Governor