Money

Budget tops list of unfinished business

New Mexico legislators start their 60-day session Tuesday with plenty of unfinished business, including closing a projected budget deficit of about $67 million. But any hope that the passing of a rancorous election year and the ongoing budget crisis would inspire bipartisan compromise already seems to have evaporated. Instead, Republican Gov. Susana Martinez and top lawmakers have staked out positions that almost guarantee a clash over taxes and spending. In addition, more budget cuts are likely, no matter the outcome. Martinez proposed easing the projected deficit by requiring public employees to pay for a bigger share toward their pensions.

Oil rig in southeast New Mexico.Margaret Wright

Federal report: energy prices rising

As New Mexico legislators get ready to tackle the ailing state budget in a few weeks, oil and gas prices are on the rise. Today, the U.S. Energy Information Administration announced that energy commodity prices rose more than any other sectors last year. According to the EIA, after two years of significant declines, crude oil prices rose late in the year. That happened after OPEC (Organization of Petroleum Exporting Countries) and non-OPEC countries announced they would cut production in early 2017. A widespread boost in production over the last few years, in the United States as well as the Middle East and Russia, had led to a glut of oil and lower prices.

New York, NY USA - July 16, 2016: Donald Trump speaks during introduction Governor Mike Pence as running for vice president at Hilton hotel Midtown Manhattan

Trump appointments, policies will have long-term impacts on NM

Each announcement by President-elect Donald Trump’s transition team about his picks for cabinet positions flares public interest. Whether it’s ExxonMobil CEO Rex Tillerson to lead the State Department or former Texas Governor Rick Perry as secretary of the U.S. Department of Energy, the appointments provide insight into what the businessman’s presidency might mean for America and the rest of the world. Those appointments will have significant impacts here in New Mexico, which has 23 sovereign Native American tribes, millions of acres of federal lands and an abundance of natural resources like oil, gas, coal, copper and uranium. Not only that, but in the past five years, the state’s environmental regulations and agencies—which might have been able to hold the line against some of the incoming president’s policies—have been weakened during the administration of Gov. Susana Martinez. When it comes to issues like science and environmental regulations, high-level staff picks have long-term impacts on everything from pollution trends and energy policy to the rate at which the Earth’s atmosphere is warming.

Flaring at a well in northern New Mexico.

New Mexico supports BLM in methane rule fight

New Mexico has joined the fight over the federal government’s regulation of methane releases from oil and gas operations. This week, New Mexico Attorney General Hector Balderas and California Attorney General Kamala Harris filed a motion to intervene in the case the industry filed against the federal government. The Western Energy Alliance and Independent Petroleum Association of America want to overturn the U.S. Bureau of Land Management’s rule that regulates the release of methane, or natural gas, from oil and gas operations on federal and tribal lands. New Mexico and California support the rule. According to court documents the BLM’s rules will benefit the two states in three ways: generating more annual revenue by cutting natural gas waste, protecting public health from harmful air pollution and reducing the impacts of climate change.

Money

Projections show decline in state revenue

During September’s special legislative session, lawmakers agreed on fixes that added about $23 million in revenue. That was a start, but not nearly enough to solve the state’s budget crisis. On Wednesday, state legislators received little good news about the state’s revenue stream during a committee meeting. Even with that help, New Mexico’s bean counters dropped their revenue projections for the current fiscal year from previous estimates by more than $130 million. The state’s current fiscal year began in July and ends next June.

Oil well in southeastern New Mexico

Commission approves water plans amid backdrop of falling water supply

At Monday’s meeting of the New Mexico Interstate Stream Commission (ISC), directors voted to accept two of the state’s regional water plans, one for Lea County and another for the Lower Pecos Valley. The plans are part of a legislatively-mandated regional water planning effort, which at some point is supposed to be rolled into an updated water plan for the entire state. The process dates back to the 1980s. Over the past few years, ISC staff, consultants and local stakeholders have updated plans for each of the state’s 16 water districts. All regional water plan must be accepted by the Interstate Stream Commission, a public body made up of governor appointees.

People of all political backgrounds love New Mexico for its mountains and deserts, blue skies and unique landscapes. And yet, discussions about natural resources, the environment and regulations often become politicized.

The launch of our new environment beat

After more than a decade of freelancing for magazines, newspapers and radio, I’m settling down. Beginning this month, readers of NM Political Report will start seeing more news stories about water, environmental justice, public lands, wildlife, nuclear waste, climate change and energy. As much as I have loved working with different editors and teams over the years, I am relieved that NM Political Report has decided it needs to be covering statewide environmental issues regularly. During a time when issues like climate change, water and environmental regulations have become increasingly important, newspapers nationwide have cut their science and environment beats. On top of that, strapped newsrooms often don’t have the resources—or the subscribers—to justify covering issues that are so important to rural communities.

Oil rig in southeast New Mexico.Margaret Wright

Land Commissioner to pitch expanding drilling to fund early childhood education to ALEC

New Mexico’s Commissioner of Public Lands is slated to speak Friday with a group of conservative-minded state lawmakers in Washington D.C. about his proposal to transfer federal mineral rights on private lands to the state. Land Commissioner Aubrey Dunn is also planning to meet with members of Congress in order to urge them to approve the transfer, according to spokeswoman Emily Strickler. In an email to NM Political Report, Strickler said Dunn is promoting his Early Childhood Education Land Grant Act to state lawmakers at an American Legislative Exchange Council (ALEC) policy summit. Related: BLM finalizes rule to limit methane emissions

“The group Commissioner is presenting to at ALEC would not be voting on this legislation, but may be interested in using the legislation as a model for legislation in their states,” Strickler wrote. “Also, Commissioner will be meeting with New Mexico’s congressional delegation while in D.C. to discuss this legislation because it needs congressional approval.”

ALEC members use model legislation to spread laws throughout states, with the most high-profile example perhaps the so-called “Stand Your Ground” laws that are in place in several states.

Oil rig in southeast New Mexico.Margaret Wright

Land Commissioner says new oil rule aimed at helping state, not companies

A new rule for oil leases by the New Mexico Land Office is aimed at ensuring companies don’t abandon wells and the state doesn’t lose out on revenues. Contrary to a previous news report—that the state was waiving land rentals for energy companies—the state land office said the new “shut-in” rule gives small oil companies a small amount of leeway in temporarily halting production instead of completely shutting down wells that are not currently economically viable. It does not, Land Commissioner Aubrey Dunn said, allow companies to stay on state land rent-free. “The rule requires annual rental payment while the well is temporarily shut-in—but, ultimately, this rule seeks to benefit the long-term interests of the trust and will result in more royalty revenue down the line,” Dunn said in a statement to NM Political Report. New Mexico has long depended on oil and gas revenues to help balance the state’s budget, but recent price drops have created hard times for the state financially.

Birds-eye view of Jal, NM.

City gave ranch million-dollar water discount, documents show

This story was reported in partnership with the Jal Record, a weekly newspaper based in southeastern New Mexico. JAL—Like many areas in New Mexico, water is in short supply in this southeastern oil patch town of 2,500 people. In the past few years, city officials have tried to address the matter by limiting water use, including barring businesses from buying city water for industrial use in the summer of 2013. But between 2012 and 2014, the city gave one ranch an unusual perk—a more than $1 million discount on its water bills. On top of this, Jal continued to sell industrial water to Beckham Ranch, Inc. for six months after the ban went into effect.