Democratic state legislators who want to expand early childhood education by spending a portion of New Mexico’s $16 billion land grant endowment won another round Friday, bringing their proposal to a pivotal point. The Senate Education Committee voted 5-3 on party lines to advance the proposed constitutional amendment, formally called House Joint Resolution 1. Republicans on the committee opposed the measure, saying spending more of the endowment now would hurt future generations. One Republican lawmaker also pointed to the market’s recent volatility and said the fund has lost hundreds of millions of dollars during the decline. Under the proposed amendment, another 1 percent would be taken from the state’s Land Grant Permanent Fund.
ANTHONY — A tall chain-link fence splits the preschool campus behind Anthony Elementary in southern New Mexico: federally funded classrooms on one side, state-funded classrooms on the other. The fence serves as a literal and symbolic divide segregating two sets of classrooms outfitted with the same child-size tables, chairs and toys; two sets of highly trained teachers; two separate playgrounds — and a bitter competition for 4-year-old children. As New Mexico has expanded early education for toddlers over the past decade, the state has created a system that bars providers from mixing state and federal funds in the same classroom. It’s a policy – not a law – that effectively separates kids into rival programs, often divided by income. Head Start serves the lowest income families in New Mexico; the state programs serve families from a range of income levels.
If state Sen. Bill Soules had his way, New Mexico would invest an extra $375 million in public schools right now. Where the cash-strapped state would find that money is another matter altogether. Soules, a Las Cruces Democrat, has once again introduced legislation calling for the state to follow the recommendation of a decadeold study and funnel hundreds of millions of dollars more into its public education system — one that generally ranks at or near the bottom in most national reports. But Soules’ bill doesn’t have a chance in the upcoming legislative session. And he knows it.
New Mexico finally received some good news on the budget after two years of sharp downward trends. Of course, recovering from those losses will still take time. This morning, two cabinet-level secretaries and the Legislature’s top economist presented revenue estimates to the Legislative Finance Committee that project the state will have $199 million in new funds for the budget next year. Presenters warned they were only cautiously optimistic on the budget surplus because of a number of potential risks that the state has little to no control over. The news is better than what the committee heard in August, and the revenue is expected to come from larger-than-previously-expected growth revenues from personal income taxes, corporate income taxes and money received from the oil and gas industry.
The tax bill Congress is considering could blow up New Mexico’s budget—as early as next year. New Mexico Senate Finance Committee chair John Arthur Smith, D-Deming, and House Appropriations and Finance Committee chair Patricia Lundstrom, D-Gallup, sounded the alarm with a letter to members of the congressional delegation and Gov. Susana Martinez. The two wrote the state could lose nearly $600 million in federal funding in the coming year, including over $430 million in federal mineral leasing payments. This is money the federal government pays to states for oil and gas drilling and coal mining on federal lands within their borders. “Loss of FML revenues, which primarily fund public education in New Mexico, would have a devastating impact on the state’s budget and would wipe out the reserves our state has struggled to rebuild,” the two legislators wrote.
The question isn’t if there will be another recession, it’s when the next recession will hit. And a new report finds that New Mexico is among the most ill-prepared states for an economic downturn. Moody’s Analytics analyzed all 50 states to find out which are best- and least-prepared for the next recession. Performing “stress tests” on each of the states’ budgets, the risk management company looked at how drops in tax revenue and increases in Medicaid spending from a recession would impact state spending—and if states had enough reserves to weather a moderate or severe recession without raising taxes or cutting spending. Senate Finance Committee Chairman John Arthur Smith said one clear indicator that New Mexico isn’t ready is the state has “never fully recovered from the recession when the rest of the nation has.”
The inability to recover from the Great Recession shows that the next recession “should be around the corner” according to Moody’s Analytics.
ByJohn Arthur Smith, Steven P. Neville, Mary Kay Papen |
We and other legislators had hoped that the regents of New Mexico State University, in accepting the recently announced retirement of Chancellor Garrey Carruthers’ at the end of his contract next year, nonetheless would ask him to stay on for two more years. Chancellor Carruthers’ record of vision and leading the institution is outstanding, and big challenges lie ahead. The university needs him. Senator John Arthur Smith (D-35-Doña Ana, Hidalgo, Luna, Sierra) is the Chair of the New Mexico Senate Finance Committee. Senator Steven P. Neville (R-2-San Juan) serves on the New Mexico Senate Finance Committee.
New Mexico’s savings keeps dropping —and now the state has one of the smallest cushions of any state in the nation. Even now, those reserves are still well below pre-recession levels. If no new money were coming in and the state government could rely only on those reserves, there would only be enough cash to run the state for 8.4 days. That’s according to The Pew Charitable Trusts and its analysis of states’ fiscal health. In Fiscal Year 2016, the amount of money New Mexico held back and put into savings—to pay for unexpected expenses or shore up the budget when revenues dip—was at its lowest level since 2000, according to Pew.
How New Mexico educates its children will be in the hands of a state judge soon as a landmark trial against the state Public Education Department wraps up. Over eight weeks, the trial has featured dozens of witnesses and numerous citations to academic studies and policy reports. But in the end, the trial before First Judicial District Judge Sarah Singleton in Santa Fe boiled down to dueling worldviews. The plaintiffs — the New Mexico Center on Law and Poverty and the Mexican American Legal Defense and Educational Fund (MALDEF) — cited education outcomes for low-income, Native American and English language learners as evidence that New Mexico does not meet its constitutional obligation to provide a sufficient education for all children. This story originally appeared at New Mexico In Depth and is reprinted with permission.
For most of this year, the budget was the hottest topic for legislators and the governor. Both branches battled, then came to an agreement no one seems enthusiastic about. The deal suggested by Gov. Susana Martinez essentially amounted to using bonding money normally reserved for state infrastructure to balance the budget. State lawmakers request the bonding money for state infrastructure projects. Issuing bonds works like a home mortgage: the state borrows money backed by oil and gas revenue and pays it back with interest over the years. Senate Finance Committee Chairman John Arthur Smith, D-Deming, said the funding method “sets a poor precedent” while Senate Minority Leader Stuart Ingle, R-Portales, said he didn’t “like to do this either.”
And yet, the plan passed with a unanimous vote in the House of Representatives and just two dissenting votes in the Senate.