Oil production, consumer spending help boost state revenues

Politics - Government

NEW MEXICO (KRQE) – Despite an unpredictable year that saw high unemployment and shutdowns from the pandemic, New Mexico is looking at a record-setting year for revenue. New Mexico is projected to have $1.4 billion more in its budget than it did last year. However, state lawmakers have different ideas on how to spend it.

The pandemic caused panic so state lawmakers trimmed the budget to make sure we would stay afloat. But in a recent legislative finance report, things are actually looking up for New Mexico. The state is looking at $8.8 billion in revenue in the coming budget year, that’s one billion dollars more than last year.

“There were some unexpected things,” said Sen. Steven Neville (R- Aztec). “We had gross receipts on internet sales that kicked in this last year we didn’t know what that was gonna do and it turns out that was a God send early on when we didn’t know what was gonna happen with COVID.”

Most of the success is from oil and gas and higher than expected personal income taxes and gross receipts taxes. Analysts said the federal stimulus money helped boost spending and now that COVID-19 restrictions have been lifted and places are reopening, people are getting hired and wages are increasing. The state can expect personal income taxes to continue to grow.

Story continues below:

“We’re just very happy,” said Rep. Moe Maestas (D- Albuquerque). ‘All that stress from years past is now behind us. The rollercoaster of state government has stopped and now we’re on the Ferris wheel and we can govern again and project out into the future and invest in the future.”

With $1.4 billion in new money, lawmakers are thinking about how to invest it. Rep. Maestas said that money could help in infrastructure projects and beef up funding for state agencies. “But also invest in early childhood education and increase the salaries of early childhood providers and make sure there’s a pathway for all New Mexicans to get into that profession,” said Rep. Maestas. “Taking a hard look at our universities and ask ourselves do we really want to develop world class research institutions. I think that’s a good dollar spent as well.”

Sen. Neville said we should make sure our reserve funds are healthy in case the oil market plunges again and instead, New Mexico should invest in new revenue streams. “We’re gonna have to do some kind of structure and that really means we have to develop our business economy our business climate,” said Sen. Neville. “So that we can have more Facebooks more Intels, more of those kinds of industries and they need to be all over the state not just in the Albuquerque metro area. We gotta get them out in Clovis, in Farmington, Clayton and wherever.”

Lawmakers will decide what to do with the money when the legislative session begins in January. The state revenue bump does not include the $1.75 billion in federal COVID relief funds that the governor’s office has only partially earmarked.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Latest Video

Now Trending on KRQE.com

New Mexico Hourly Forecasts ⟶

Albuquerque Hourly Forecast

Don't Miss


Photo Galleries


News Resources - Maps