Editor's Note: The initial version of this article stated Jan. 16 is the start of a special legislative session, however that is inaccurate and has since been corrected. The Daily Lobo apologizes for any confusion.
New Mexico’s legislative session begins Jan. 16 — to preview the legislative priorities for this session, the Santa Fe Chamber of Commerce invited leaders from the New Mexico State Senate and House of Representatives to provide a public briefing Jan. 11 at the Santa Fe Hilton.
Sen. Peter Wirth, the Democratic Majority Floor Leader, described a number of items expected to be on the special session agenda. He said that, due to fluctuations in the price of oil and gas, New Mexico’s budget has experienced a $500 million swing in revenues. This has taken them from a deficit situation to a projected surplus that is expected to be somewhere in the range of $200 to $250 million in new money, meaning that spending is now possible.
In part this new money, according to Wirth, is due to advances in hydraulic fracturing, or “fracking,” technologies, which can be used to access the estimated $50 billion worth of shale oil that is now believed to be accessible in the South Eastern part of New Mexico.
“This is not a good thing to have this kind of volatility,” Wirth said. He said that in order to address this issue in the last session, “We passed a bill that created a new oil and gas reserve specifically designed so that when the oil money starts to pour in, we capture a good chunk of it and put in the reserve.”
Wirth said there are a number of priorities for this new money, but he does not expect the legislature will “go on a spending spree.” The top priority, he said, would be raises for state employees and teachers.
“We are finally going to give across-the-board raises for state employees and additional raises for teachers,” he said. “We have been beating up on state employees and teachers for way too long.”
In terms of other priorities, he said New Mexico has public financing of appellate court and Public Regulatory Commission races, but there is not currently money in the budget to fund that. He also said there is a need to spend more on public safety, adding, “clearly, public safety is a huge issue in our state. There’s a crisis. There’s no way around it.”
Also on hand was state Rep.Carl P. Trujillo, the Taxation and Revenue Committee Vice Chairman and a Santa Fe Democrat representing District 46.
He described how dire the financial situation was last year, by comparison — he said New Mexico had no reserves and, “we were actually writing bad checks.”
“We need to grow (our) dollars through economic development,” Trujillo said. Growth is not always easy, because most money is already spoken for, especially with respect to education, he said.
“What many people might not realize is that we are one of the only states that funds education and the operational costs 100 percent on the state level,” Trujillo said. “So 43 percent of that $6.4 billion budget goes to K-12 education, 13 percent goes to higher ed, 28 percent goes to Medicaid, the health department and CYFD and another 12 percent goes to courts and correctional, as well as our judiciary.”
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In the end, this means 96 percent of the money is already allocated. However, he said there are some additional sources that can be used, particularly from New Mexico’s Severance Permanent Fund, which receives royalties when natural resources such as oil, gas, copper and potash are extracted.
“In our Severance Permanent Fund…there is 9 percent that’s allowed to be used for economic development,” Trujillo said.
He said there are also sources such as the Land Grant Permanent Fund, which receives revenues from land given to the State of New Mexico by the Federal government.
“You always hear a lot of talk about the Land Grant Permanent Fund,” Trujillo said. “I think it might be at $18 billion or so. Statutorily we take 5 percent of those revenues…so about $900 million goes into the general fund every year.”
He said some legislators want to raise the statutory amount above 5 percent so that more money could be allocated to additional projects.
Sen. Nancy Rodriguez, a Santa Fe Democrat representing District 24, was also present. She has served on the finance committee since 1996.
She said she has a number of concerns about the budget this year, particularly because “there is so much uncertainty because of federal things happening with Congress.”
She said it is not clear what the financial impact of changes to the Affordable Care Act will be, for example, and she is also worried the $38 million that the federal government is supposed to contribute to the Children’s Health Insurance Program may not come through this year.
She also said the governor’s office is expected to introduce many new “crime enhancement” bills that are intended to protect victims’ rights, but there are concerns about funding.
“There are approximately 40 bills that are coming in on that issue, and a variety of issues, but there is no funding to accompany those bills,” Rodriguez said. “I think what we want to do this year is say, ‘Any bill that has so much cost attached to it, we want to know where the offsetting revenue is going to come from.’”
She said there appears to be a disconnect between what the legislature expects to spend and what the governor is proposing.
“Of the $199 million that we are expecting, we have budgeted $178 million of that,” Rodriguez said. “We are concerned, because the governor, through the executive budget, has proposed $251 million, so it’s overspent in that respect.”
The senator also noted that the New Mexico Supreme Court is still scheduling hearings on bills that the governor vetoed in the last legislative session.
“For 10 of our bills that passed with a huge majority, some of them unanimously, (Gov. Susana Martinez) vetoed them,” she said. “So we had to file a lawsuit in district court, and that was decided in our favor, but that was appealed by the governor.”
However, there still appeared to be strong optimism from all legislative leadership present that it should be possible to work together and resolve these issues in the upcoming session.
The University of New Mexico also has a number of legislative priorities, according to the Office of Government and Community Relations.
As New Mexico’s flagship institution of higher education, UNM officials are interested in seeking funding for a number of capital outlay projects at the Main Campus and branch campuses. UNM is also requesting funding restoration for research and public service projects as well as securing sufficient monies to provide for competitive compensation for faculty and staff, according to their legislative priorities document.
Aaron Cowan is a volunteer reporter for the Daily Lobo. He primarily covers volleyball and men's and women's golf, but also writes on areas including culture and politics. He can be reached at firstname.lastname@example.org or on Twitter @AaronTCowan