New Mexicans should expect smoother roads and state government employees can look forward to a 1.5 percent cost-of-living adjustment in the upcoming fiscal year under a $7.39 billion spending plan the House Appropriations and Finance Committee unanimously approved Monday. The proposed budget, which represents a 4.6 percent increase over the current fiscal year, includes $300 million for state and local roads. The proposal also calls for $64 million in spending for a cost-of-living adjustment for all state government, public school and higher education employees. “This is the cleanest bill I’ve seen in the last 20 years,” said Rep. Patty Lundstrom, a Gallup Democrat who chairs the committee. “There’s no love handles on this bill.”
To some degree, the two contrasting actions that played out late Friday morning spoke volumes about this year’s 60-day legislative session. In the House of Representatives, members prepared to debate a contentious bill that would repeal a decades-old law making it a felony to perform an abortion. Around the same time, in her Santa Fe home, Sen. Nancy Rodriguez, looked at a huge pile of mail from constituents and pondered what lawmakers in her chamber still need to do with fewer than 30 days remaining in session. Later that day, as Rodriguez joined her colleagues on the Senate floor, the House voted to approve the abortion repeal measure, sending it to the governor’s desk. One down, hundreds to go.
Proposed cuts to higher education spending in New Mexico could jeopardize some research funding for state universities and lead to a hiring freeze at Santa Fe Community College, advocates say. Universities and colleges in New Mexico are denouncing proposed cuts to higher education spending as lawmakers trim budgets across state government to fill a $2.4 billion budget hole wrought by the COVID-19 pandemic and a devastated oil and gas market. A draft House bill seeking to blend recommendations from Gov. Michelle Lujan Grisham and an influential budget committee would slash roughly 6 percent from research and public service projects at universities and 4 percent for broader university and public college funding from the state. That would represent the steepest reductions for any state-funded department or agency eyeing potential cuts as lawmakers address the budget shortfall. The Legislature is still debating the proposed cuts.
It took moving a few million dollars here and putting a few million dollars there, but New Mexico had a budget by the end of Wednesday. A $6.3 billion spending plan is on its way to Gov. Susana Martinez after the Senate and House of Representatives brokered a compromise on slightly different budgets approved by both chambers. The compromise won bipartisan support in the House and Senate, a marked departure from recent years when financial shortfalls led to spending cuts and intensely political clashes over state spending. Meanwhile, a spokeswoman for Gov. Susana Martinez signaled that she would be receptive to the budget. That is different from last year, when she vetoed much of the annual spending plan, at one point threatened a government shutdown and ultimately forced a special session.
The Legislature’s two chambers are at odds over a proposed $6.3 billion state budget. Unlike recent years when financial problems prompted rounds of cuts, partisan fights and depleted reserves, the disagreements that emerged Tuesday came down to comparatively minor questions about funding roads. The Senate overwhelmingly approved a spending plan on Tuesday that provides bigger pay raises for state police than a version of the budget passed by the House of Representatives. The Senate version of the budget, approved 40-2 by members of that chamber, also provides millions of dollars in additional funding for the district attorney in Albuquerque and returns some of the money cut from school districts last year. But the Senate also scaled back the amount of money the House had approved for roads.
A sinkhole is threatening to swallow part of Carlsbad. In the meantime, it is poised to consume tens of millions of tax dollars. The state House of Representatives voted 70-0 on Monday to send a bill to Gov. Susana Martinez that would take part of the taxes on car sales to pay for the remediation of a brine well that is at risk of collapsing. “This is an absolutely critical bill for averting a disaster in [the] southern part of the state,” said Rep. Cathrynn Brown, R-Carlsbad. The 350-foot-wide, 750-foot-long cavern sits beneath two major highways, a railroad, a mobile home park, an irrigation canal and businesses, she said.
The New Mexico House of Representatives passed a spending plan late Wednesday that boosts funding for classrooms and the courts, while cutting money for colleges and universities and leaving most other agencies with no new money. A companion bill also headed to the Senate, House Bill 202, would raise more revenue for future years by boosting fees and taxes. The $250 million a year in new ongoing revenue is needed to avoid more spending cuts and to replenish cash reserves, said sponsor Carl Trujillo, D- Santa Fe. “We are bleeding, we need to stop that bleeding,” Trujillo said as he held up a graph showing the state’s diminished reserves. The House approved the revenue measure first, because the proposed budget needs some $157 million in additional money to meet the constitutional requirement for a balanced budget.
A former state senator who is helping lead the fight against high-interest payday and other small loans said Monday that a bill to cap rates at 36 percent is dead. “The governor would veto it anyway,” former Sen. Steve Fischmann, co-chairman of the New Mexico Fair Lending Coalition said, referring to House Bill 26, sponsored by Rep. Patricia Roybal Caballero, D-Albuquerque. But Fischmann, a Mesilla Park Democrat, said supporters of the bill are in negotiations with certain parts of the industry that are backing another bill aimed at regulating businesses that offer small loans at high interest rates. “I think we are getting close to a deal,” Fischmann said. That bill, HB 347, sponsored by Rep. Patty Lundstrom, D-Gallup, would in effect set maximum interest rates of 175 percent.
With the state still running a deficit and reserves depleted, Democrats in the New Mexico House of Representatives have identified four tax or fee increases they say would prevent more cuts to education and put the state on better financial footing. The initiatives — taxing all internet sales, raising the permit fee on heavy trucks, closing a loophole that benefits nonprofit hospitals and increasing the tax on vehicle transfers — could raise more than $200 million in ongoing revenue. Some of it would go to avoid cuts in state agencies and some to beef up reserves. The move to bring together the House Democratic caucus came on the same day as state economists restated a revenue forecast from December that shows the economy has stabilized but reserves are far below the desired level of $300 million, or 5 percent of recurring revenue. The reserve account for the $5.6 billion budget at the end of the fiscal year on June 30 is projected at 1.6 percent.