New Mexico Budget Bill Would Found Literacy Institute, Propel Housing Construction And Conservation

The Round House is pictured at the beginning of the 56th Legislature at the Capitol, Tuesday, Jan. 16, 2024, in Santa Fe, N.M. (AP Photo/Roberto E. Rosales)
The Round House is pictured at the beginning of the 56th Legislature at the Capitol, Tuesday, Jan. 16, 2024, in Santa Fe, N.M. (AP Photo/Roberto E. Rosales)
View All (3)

SANTA FE, N.M. (AP) — New Mexico’s strategy for spending and investing a multibillion-dollar annual surplus linked closely to oil production came into sharper focus Saturday, as a legislative panel advanced an annual spending plan toward a Senate floor vote.

Legislators are tapping the brakes on recent double-digit budget increases in the nation's No. 2 state for oil production behind Texas, while setting aside money in endowments and investment accounts to ensure funding for critical programs in the future — in case the world’s hunger for oil weakens.

Advancing on a 11-0 committee vote, the amended budget proposal would increase annual state general fund spending by roughly 6.8%, to $10.2 billion, for the fiscal year that runs from July 2024 through June 2025.

Proposed changes from the Senate add $32 million to the spending package, setting average public salary increases at 3% for state employees and staff at K-12 schools, state colleges and public universities.

New Mexico Gov. Michelle Lujan Grisham has advocated for a more robust spending package, a 10% annual spending increase that would shore up housing opportunities, childhood literacy and health care access.

New Mexico’s Legislature assembles its own budget — a bill that currently includes the governor's $30 million request to establish a literacy institute and bolster reading programs, along with $125 million in new financing for housing development projects.

Democratic state Sen. George Muñoz of Gallup, chairman of the lead Senate budget-writing committee, said the budget plan slows down spending increases and still funnels more money to rural hospitals, the new literacy institute, state police salaries, safety-net program for seniors and increased highway spending to overcome inflationary construction costs.

A monthly payment of $25 to impoverished seniors and the disabled from the Supplemental Nutrition Assistance Program would increase to $100, he said.

“You can leave at the end of the day and say we helped the poor, we helped the seniors, we helped law enforcement, you fixed a lot of things,” Muñoz said.

Legislators also want to help the state and local governments compete for a greater share of federal infrastructure spending from the Inflation Reduction Act, the Biden administration’s signature climate, health care and tax package. Senate budget amendments apply $75 million in state matching funds to the effort.

Under another $1.5 million budget provision, New Mexico would for the first time help compensate landowners and agricultural producers when wolves are confirmed to have killed livestock or working animals.

Wolf-livestock conflicts have been a major challenge in reintroducing endangered Mexican gray wolves to the Southwest over the past two decades. Ranchers say the killing of livestock by wolves remains a threat to their livelihood despite efforts by wildlife managers to scare the wolves away and reimburse some of the losses.

Separately, a conservation fund established in 2023 would get a new $300 million infusion. The fund underwrites an array of conservation programs at state natural resources agencies, from soil enhancement programs in agriculture to conservation of threatened and big-game species.

Leading Democratic legislators also say they want to ensure that new initiatives at agencies overseen by the governor are cost-effective and responsive — especially when it comes to public education, foster care and child protective services — before future funding is guaranteed.

The state House on Friday endorsed the creation of the “government results and opportunity” trust that would underwrite pilot programs during a three-year vetting period, with requirements for annual reports to the Legislature’s accountability and budget office. The Legislature's budget bill would place $512 million in the trust.

“It gives us funding for several years to solve problems,” said Rep. Nathan Small of Las Cruces, a cosponsor of the initiative. “It gives us a quick ability to analyze whether or not, and how, that’s working.”

Legislators have until noon Thursday to deliver a budget to the governor, who can veto any and all spending items.