February 6, 2020

New Mexico House passes $7.6 billion spending plan

The state House approved a $7.6 billion budget bill Wednesday, after Republicans criticized it and proposed an alternate plan during a floor debate.

The House passed House Bill 2, the General Appropriations Act of 2020, by a vote of 46-24 along party lines after a three-hour debate. The spending plan represents a 7.5 percent increase from the current fiscal year, boosting spending in areas such as early childhood education.

“Given all the important demands and the new demands, we made great progress,” House Speaker Brian Egolf said in an interview after the vote. “I think this is a budget that shows that we take very seriously the commitment to deliver on education, health care and public safety.”

The bill represented a middle ground between the fiscal year 2021 spending plan proposed by Gov. Michelle Lujan Grisham and another recommended by a key legislative panel. The governor had called for a $7.68 billion spending plan, while the Legislative Finance Committee recommended $7.55 billion.

“I am so proud of this responsible budget that we’ve created,” said Rep. Joseph Sanchez, D-Alcalde, who is vice chairman of the House Appropriations and Finance Committee.

House Republicans were not satisfied, however, and accused Democrats of moving forward with a plan they called too heavy on spending. During a floor debate, they proposed an amendment to the bill, which was eventually voted down, that would have established a smaller spending increase of 4.3 percent.

“Do we all just believe that throwing money at a problem is the solution?” said Rep. Jason Harper, R-Rio Rancho, who introduced the amendment. “I would say that is never the solution.”

During a news conference earlier Wednesday, Harper said of HB 2, “We are very concerned about the runaway spending proposed in this budget. I think ‘concerned’ is too soft of a word. We are terrified.”

The Republican plan proposed paying $200 to every New Mexican, which the GOP said would help “alleviate the over-taxation of wage-earning New Mexicans.” It also called for a new education program that Republican legislators said would target at-risk students.

Since the beginning of the legislative session, Republicans have criticized Lujan Grisham and Democratic lawmakers for spending proposals they argue are irresponsible and don’t account for a potential future decline in oil prices or slowdown in the economy.

“Because of our undisciplined and reckless spending, the oil and gas industry will collapse and we’ll be in here and it will be even more painful than it was six years ago,” Harper said, suggesting lawmakers would have to call a special session to make cuts in the case of a downturn in oil prices.

But Democratic legislators, who have a nearly two-thirds majority in the chamber, expressed many misgivings with the Republican plan, and then voted to table it.

They pointed out numerous areas that they said would not receive enough money under the GOP plan.

For instance, they pointed out the Republican proposal would only give a 3.1 percent increase to the Department of Health, compared with an 8.5 percent hike under HB 2.

The Republican proposal also would have given an 8 percent increase to early childhood education versus a 23.7 percent increase in House Bill 2, according to House Democrats. Republicans would give $179 million less to K-12 education, a 5 percent increase instead of a 7.2 percent hike. And corrections would get a 1.4 percent increase instead of a 5.8 percent boost.

“They said they wanted to show the state what they would do if they were in control,” Egolf said. “Now, its crystal clear that if the Republicans were in control we would not see significant increases in education, health care and public safety.” 

Democrats also pushed back on the notion that the budget bill has been a partisan effort, pointing out that members of both parties worked together to craft it on a key House committee.

“This isn’t some partisan semi driving through the chamber,” said Rep. Javier Martinez, D-Albuquerque. “It is very detailed and by no means do I believe that this is reckless spending or we’re just attempting to break the bank.”

Rep. Patricia Lundstrom, a Gallup Democrat and chairwoman of the House Appropriations and Finance Committee, said before the floor session Wednesday that Republican legislators were “uninformed.”

New Mexico doesn’t have a structural budget problem, and the budget bill has an “incredible” level of reserves, she said.

“The spending is in correlation to the revenue,” Lundstrom added.

She also called the Republican proposal a “political move.”

The Senate Finance Committee can modify the budget proposal when it takes up the bill. Sen. John Arthur Smith, chairman of that panel, has said he had concerns about parts of the legislation.

“There are a lot of deficiencies in House Bill 2,” Smith said Tuesday.

He said on the Senate floor Wednesday his chamber would add $20 million in appropriations to a proposed early childhood trust fund. Senate Bill 3, which would create that fund and passed the Senate Wednesday, called for a $320 million appropriation, but the House only budgeted $300 million for it.

“I’m sure this body will correct that action by the House,” said Smith, D-Deming. “We will fix that.”

Overall budget increase

HB2: 7.5%

GOP: 4.3%

Proposed reserves level

HB2: 26%

GOP: 30%

Early childhood education funding increase:

HB2: 23.7%

GOP: 8%

Department of Health increase:

HB2: 8.5%

GOP: 3.1%

Corrections increase:

HB2: 5.8%

GOP: 1.4%