February 17, 2022

House, Senate resolve budget disputes; nearly $8.5B plan moves to governor

Kendra Chamberlain

After an eleventh-hour dispute between the House and Senate, New Mexico’s proposed budget for fiscal year 2023 — the largest on record — is back on track.

A conference committee made up of three members from each chamber brokered a compromise over spending disagreements during a Wednesday morning meeting that lasted less than 10 minutes.

By the afternoon, the deal won bipartisan support in both chambers, advancing the nearly $8.5 billion spending plan to the desk of Gov. Michelle Lujan Grisham.

The budget agreement was critical as the session rolls to a conclusion, but as of late Wednesday night, several key issues — crime, tax cuts and expanding voting access — remained unfinished, with both the House and Senate debating bills past midnight.

Lawmakers have expressed concerns about tackling such an aggressive agenda in a short session meant to focus on legislation dealing with budget and tax issues, though the governor has the authority to place any item on the agenda.

The proposed budget, with a nearly 14 percent increase in spending over the current fiscal year, makes a huge investment in the state government’s workforce, providing raises for teachers, state police officers, judges and all other employees.

The differences between the House and Senate versions of the budget sparked an impasse Tuesday when representatives voted against concurrence and senators held their ground.

But the issues were settled with less than 24 hours left before the noon Thursday deadline to get the budget to the governor.

“We’re glad to see a budget emerge that includes funding for a great many of the priorities included in the governor’s executive budget recommendation,” from 7 percent raises for all public school staff to establishing a minimum $15-an-hour wage for all state employees, Nora Meyers Sackett, the governor’s press secretary, wrote in an email.

“We appreciate the hard work that went into this budget and we are proud to lead a state that supports the governor’s mission of making transformative investments that will carry our state and its people into a future that lifts up every New Mexican,” she wrote.

Among the changes the conference committee approved:

• Reducing a proposed $125 million appropriation to make New Mexico a hub of hydrogen production by $75 million and putting the money into reserves. The remaining $50 million would be directed to a bill designed to facilitate transportation and broadband projects through public-private partnerships.

A governor-backed effort to pass a Hydrogen Hub Act to create the framework for a new industry producing hydrogen as an energy source faltered during the session amid stiff opposition from environmentalists and others.

Rep. Patty Lundstrom, D-Gallup, who chairs the House Appropriations and Finance Committee and championed four hydrogen hub proposals, said the $50 million wouldn’t be used for hydrogen facilities.

“There’s no framework for it,” she told reporters.

Lundstrom, however, said she wasn’t ready to give up on hydrogen.

“I’ll keep working on that ’til I drop over,” she said.

• Striking language that would have made a $50 million appropriation for the recruitment and retention of police officers “contingent” on the passage of a bill still being considered by the Legislature.

Lundstrom said the contingency requirement gave the House the biggest “jolt” and was the “primary reason” the chamber rejected the Senate’s budget amendments.

“We completely disagreed with that being contingent on a bill passing, and that was the whole reason I would not concur,” she said. 

“There’s like 20 bills out there floating around for crime … and then when they tack that language on there — ‘only if this bill passes’ — well, c’mon now,” she said. “We’re at the eleventh damn hour. Where’s that bill now?”

The Senate was expected to consider the bill Wednesday evening as part of an omnibus crime package.

• Adding $1 million for the state’s cannabis control program and to purchase vehicles and equipment.

• Adding $500,000 for advocates of violent crime victims.

• Adding $5 million to ensure there’s enough money to pay state employees a $15 minimum wage. 

Members of the conference committee failed to reach an agreement on two proposed appropriations in the House version of the bill. Senators voted against a $30 million line item to expand rural health care delivery programs and an additional $5 million for soil and water conservation districts.

“We didn’t get everything, but we got our main ideas,” Lundstrom said.

Sen. George Muñoz, D-Gallup, who chairs the Senate Finance Committee, echoed the sentiment.

“You give, you take,” he said.

The proposed spending plan leaves $400 million for tax incentives. While the Legislature is considering a tax package, lawmakers have yet to take action on any big tax bills.

Follow Daniel J. Chacón on Twitter @danieljchacon.