February 6, 2020

Bill to fund tax-poor rural school districts clears first committee

Laura Paskus

As New Mexico lawmakers look for a way to provide extra funding for public school students in some of the most financially challenged areas of the state, a bill that eventually would provide $60 million a year for some of those districts to share cleared its first hurdle Wednesday.

House Bill 4, sponsored by Democratic Reps. Brian Egolf of Santa Fe, Patricia Lundstrom of Gallup and Anthony Allison of Fruitland, would appropriate $18.9 million in fiscal year 2021 to start the new fund.

Over the course of three years, the fund would grow to about $60 million in both operational funding and capital outay, Egolf said, adding 23 of New Mexico’s 89 school districts would be eligible for a share.

The new funding is “a dire, dire need for us,” said Jvanna Hanks, assistant superintendent of Gallup-McKinley County Schools, a district that would qualify.

HB 4 is one of several bills filed in response to complaints from mostly rural districts that they aren’t reaping the full benefits of the U.S. Department of Education’s decades-old Impact Aid program. The initiative sends federal funding to public schools in communities with large parcels of tribal land, national forests, military bases or other types of federal land, which are exempt from property taxes.

While New Mexico funds its public schools through a formula based on student enrollment using several sources of revenue — including oil and gas production — schools in many states heavily rely on local property taxes for operations.

In 1974, Congress amended the Impact Aid program to allow states like New Mexico, with alternate school funding systems, to consider those federal payments to tax-poor districts when distributing education dollars.

New Mexico now takes credit for 75 percent of the federal Impact Aid sent to a school district, which means it deducts a portion of the per-student funding the district would receive if it weren’t getting the federal assistance.

Many of the state’s Impact Aid districts feel the deal leaves them short-changed. 

The lawmakers behind HB 4 said they want to address those districts’ concerns without pulling money from the state’s pool of education funding divvied through the enrollment formula.

Most of the Democrats on the committee agreed with the strategy.

“This is about equity. … It really does take money to do that,” said Rep. Linda Trujillo, D-Santa Fe, one of nine Democrats on the House Education Committee to vote in favor of the bill.

Administrators, educators and other advocates of several school districts affected by the federal Impact Aid program told the committee the new money is needed to attract and retain teachers, build teacher housing and fund other capital projects.

The House Education Committee chairman, Rep. Andrés Romero, D-Albuquerque, joined three Republicans in voting against the bill. He voiced a number of concerns with the legislation, saying it might benefit students in the federal Impact Aid districts, but kids in other parts of the state are equally in need of additional resources.

Romero said he’d rather see the state continue on a “holistic, basic approach” in funding for all schools.

Lundstrom wasn’t convinced. 

“If your basic approach worked, why are we being sued and why did we lose the lawsuit?” she asked Romero.

The Impact Aid issue also emerged in the 2019 legislative session, when some lawmakers introduced measures aimed at directing more state money to districts in the federal program.

Superintendents from around the state voiced concern that such efforts would mean less money for their schools.

Egolf told the committee HB 4 is one of many steps the state can take to comply with an order from a state district judge in the landmark Yazzie/Martinez v. State of New Mexico lawsuit.

The judge ruled the state was not doing enough to provide for its most at-risk kids: special-education students, English-language learners, Native Americans and those who come from low-income families.

Education advocates from Impact Aid districts told lawmakers on the House Education Committee those are the very children they serve.

HB 4 goes next to the House Appropriations Committee.