SANTA FE, N.M. (KRQE) – The state is expecting to have billions of dollars in ‘new’ money to spend when the legislature meets next month and lawmakers are already trying to figure out what to do with it.

The state is expecting $3.59 billion in ‘new’ money for the next fiscal year’s budget. The promising financial outlook was revealed in the Legislative Finance Committee meeting on Monday.

“If anybody in this committee is not nervous is about spending 3.5 billion, you should probably leave the room,” said Senator George Munoz, (D) Gallup. “No one in this state’s history has ever had this opportunity and if we don’t use this opportunity to fix problems and to fix problems within our agencies and to fix problems within our schools, then we’re going to lose out.”

The extra billions brings the state’s upcoming budget to $12 billion. State economists say the strong revenue outlook largely comes from increased production in oil and gas and robust energy prices because of Russia’s war on Ukraine. Economists say increased wage growth and a surge in consumer demand also contributed.

Like in years past with extra money, there will be calls to pump up the budget, stash more money in rainy day funds, or use it on one-time spending like building projects or fixing the state’s road problems.

“While the state’s financial status looks promising, I caution against growing recurring budgets too much given the risks presented today,” said Deborah Romero, Secretary for the state’s Department of Finance and Administration. “Leaders have opportunities to make once in a lifetime investments for the state in things like water, rural health, broadband, cybersecurity, just to name a few. But those are the once in a lifetime things that we should invest in while not growing our recurring budgets.”

State economists did warn lawmakers about factors that could undermine these projections like inflation or even a mild recession. They also reminded lawmakers about the volatility of the oil and gas industry.

Over the course of the week, major state agencies will be going in front of the LFCC with updates on their budgetary needs.