New Mexico governor seeks 13% budget increase

Data Reporting

NEW MEXICO (KRQE) – Dueling budget proposals from New Mexico Governor Michelle Lujan Grisham and a key legislative committee outline how the state could soon spend more than a billion dollars in increased revenues. The spending increases could raise state worker salaries, provide more money for schools and teachers, and spark new initiatives to hire police officers, among other programs.

The governor’s office and the New Mexico Legislative Finance Committee released their respective budget proposals Thursday, each outlining $8.4-billion in state spending. Due to higher-than-expected oil and gas revenue, the state has more than $1.5 billion in “new money,” to spend, according to the Legislative Finance Committee.

An $8.4-billion budget represents a roughly 13% increase in spending over last year. However, the proposals have a long way to go before New Mexicans could see any of the funds.

“These are investments that take us beyond the status quo,” Gov. Lujan Grisham said in a press release on Thursday. “These are investments that carry our state and its people into a future that lifts up every New Mexican.”

Each January, the governor creates a budget recommendation for how the state should spend its funds. The Legislative Finance Committee (LFC) also creates a separate budget recommendation. The proposals are sent to the state legislature, where lawmakers revise the budget until a compromise is reached. A majority approval vote then sends the budget back to the governor for final approval.

Despite the fact that many of the governor’s recommendations will be combined with the LFC recommendations, both recommenders want the same thing, Nora Meyers Sackett, the press secretary for the governor’s office told KRQE News 13, “We want to deliver meaningful investments for New Mexicans.”

House Republican Leader Jim Townsend rebuked the governor’s proposal Thursday. In a prepared statement, Townsend said, in part: “What usually gets lost in the Governor joyously announcing she is handing out cash to anyone and everyone during an election year, is that this money comes from the oil and gas industry that she, her out-of-state donors, and many progressive legislators want to shut down.”

In the last fiscal year, FY2022, the state had about $7.5 billion in recurring general funds — the majority of which came from taxes and fees paid to the state, according to the LFC. Nearly half of the funds went to New Mexico’s public schools. A little over a quarter went to the state’s Health and Human Services Departments. The rest went to higher education, public safety, and less than 5% to generally operate the government.

This year, the state will likely have more money to spend. The general fund is expected to have more than $9 billion in recurring funds, according to the New Mexico Department of Finance and Administration. About $1.6 billion of that is “new money” that hasn’t already been planned for and allocated in previous years, according to the LFC.


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Education

Both the governor’s proposal and the LFC’s proposal suggest using some of that funding to increase pay for New Mexico’s teachers. KRQE News 13 previously reported on the challenges teachers have faced during the COVID-19 pandemic and how bonuses promised to Albuquerque’s teachers fell through last year.

The governor proposed raising minimum salaries for level 1, level 2, and level 3 teachers. Her proposal would bump level 1 teachers — the lowest level of licensed teachers — to $50,000 a year, up from $41,000. The proposal raises level 2 and level 3 teachers up to $60,000 and $70,000 respectively.

The LFC’s proposal, on the other hand, only raises level 1 salaries to $48,500 and level 2 and level 3 salaries to $57,500 and $67,500 respectively.

Whitney Holland, the president of the New Mexico affiliate of the American Federation of Teachers, says raising salaries is a good start. But she also believes neither proposal goes far enough to support teachers and school staff.

“We are seeing a huge educational shortage crisis in New Mexico right now. And the pay is part of that crisis,” she told KRQE News 13. “We’re seeing a lot of people go work up north in Colorado because they get higher pay. We see people go work in Texas.”

One concern she has with the governor’s proposal is that support staff don’t get a large enough increase. The governor proposes giving a 7% boost to staff. Holland says it’s not enough. The LFC proposal does suggest a $13.50 per hour minimum wage for all Public Education Department employees, potentially giving custodians and other service providers a boost.

Cannabis

Both proposals send some money to the Cannabis Control Division (CCD), the new entity in charge of overseeing the state’s recreational and medical cannabis industry. Both budgets aim to provide staffing to the CCD, whose overseeing department asked for 69 additional employees.

The LFC recommends only funding 19. The governor’s proposal, on the other hand, provides funding for 35 new staff within the department.

Those kinds of staff increases would easily double the current number of full-time staff at the CCD. And Victor Reyes, the deputy superintendent at the New Mexico Regulation & Licensing Department, which oversees the CCD, says that additional funding will help the state regulatory department better serve customers and business owners within the cannabis industry.

“Now that we’ve established our rulemaking process and we’ve begun the infrastructure for licensing, we need to have additional staff members to better serve the public — make sure that we are making customer service a priority,” Reyes says. That includes staff to make sure businesses are abiding by the regulations in place and staff to do real-time customer support, Reyes explains.

Reyes is confident that however, budget discussions go during the legislative session, the CCD will be supported. “We know that both the executive and the legislative branches of government are committed to the success of this program. That’s why they passed this law. That’s why they gave us that initial support that we needed to be successful,” he says.

Film Industry

With the expansion of Netflix in New Mexico and more than $2 billion spent in the state, New Mexico’s film industry seems to be one that’s continuing to grow. But the COVID-19 pandemic also hit the industry hard.

The governor’s budget proposal aims to create a “Media Academy” that would help local students enter the film industry. The idea is not to make a new school, but to use $50 million in funding to support film-focused higher education in the state. The end goal, according to the budget recommendation, is to enroll 1,000 students each year in film-focused training.

In addition, the governor’s budget recommendation would add over half a million dollars to the New Mexico Film Office’s budget. That organization is in charge of making New Mexico attractive to would-be production companies. The LFC budget recommends not providing additional funding to the film program in the fiscal year 2023.

Public Safety

New Mexico — and Albuquerque in particular — has a reputation for crime. In 2021, Albuquerque broke its own homicide record. KRQE News 13 previously reported that the statewide Department of Public Safety has asked for a big budget boost.

“Every New Mexican deserves to feel safe in their community,” says Sackett from the governor’s office. “This is something that is not only relevant in Albuquerque — it’s an important issue for New Mexicans in every size community.”

The governor’s recommendation is to provide funding for the Department of Public Safety to add 100 state police officers to its ranks. The recommendation claims that an increase of a little over $10 million would be enough to fill every current officer vacancy. Even without a boost in funding, the department is projected to add 57 officers, according to the LFC.

The Department of Public Safety requested an additional $29.4 million beyond last year’s funding, according to the LFC. The department intends much of the funds to go to increasing pay and expanding training.

The LFC, however, recommends funding only a $12.8 million increase — $2 million of which would go to expanded training. The LFC predicts that such funding would allow the department to add 79 officers.

“Rather than fund positions that are unlikely to be filled because the economy is at near full employment. . . the LFC recommendation prioritizes both across-the-board pay increases, as well as targeted increases for hard-to-staff positions, like state police officers,” explains Charles Sallee, the deputy director for budget at the LFC. And that means that across many governmental departments, the LFC is recommending adding fewer new staff than the Governor recommends.

What Comes Next?

Now that both the governor and the LFC have made their recommendations, a document highlighting their differences will be presented to the Legislature near the start of the legislative session, which begins January 18. Then some combination of the two recommendations will become a bill, called the General Appropriations Act, also called House Bill 2.

Multiple committees will analyze, discuss, and modify the bill before both the House and Senate vote on the adjusted version. Once it’s approved by a majority vote, it heads to the governor’s desk for a final signature. But she has line-item veto power over the bill.

It’s not a simple process but it’s one that works, according to Sallee from the LFC. He says that the system creates a budget intended to support the people.

“House Appropriations and Senate finance committees will scrutinize both proposals and come up with something that works for the legislature and hopefully the executive branch and the people in the state of New Mexico,” he told KRQE News 13. “They’ve always worked it out and given the governor’s budget a fair hearing. And I expect them to probably do that again this year.”

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