Legislature sends budget solvency plan to New Mexico’s governor

SANTA FE, New Mexico — New Mexico’s Legislature on Saturday evening sent a budget solvency plan to the governor that would mend a multi-billion-dollar deficit by scaling back spending increases while tapping federal recovery act money and state financial reserves.

State government finances are reeling from the economic fallout of the coronavirus epidemic and aggressive state emergency health restrictions designed to hold the virus at bay. State economists are forecasting a $2.4 billion decline in state government income through June 2021 amid the economic upheaval.

Senate Democrats joined with a handful of Republican in a 30-12 vote on Saturday to approve a roughly $7 billion spending plan for the budget year beginning July 1 that scales back state spending by about $600 million. State economists expect state government income to plunge by 25% in the coming year.

State Sen. John Arthur Smith of Deming, a leading architect of the budget rewrite, said state spending is slated to increase by 1.5% during the coming fiscal year — far less than originally planned.

The pullback on spending increases goes farther than recommendations from Democratic Gov. Michelle Lujan Grisham, who has the authority to veto any and all provisions of the budget rewrite.

Smith warned that a recovery for New Mexico’s crucial oil sector may take a long time.

“New Mexico, we’re not all right,” he said. “We’re not all right until the airlines start flying again and the utilization of fuel is returned. ... This looks like it’s going to be a prolonged downturn.”

Salary increases for state agency and public school workers were scaled back from 4% to 1% or less, with pay bumps focused on lower-income public employees to offset rising health insurance premiums. State government is under a hiring freeze, with the exception of a 200-job hiring spree to help identify and trace new coronavirus outbreaks.

Legislators placed an emphasis on preserving spending increases for public education. But a $40 million chunk of budget savings can be traced to the cancellation of a landmark efforts to extend the school by five weeks for elementary school students. It’s unclear when students may return to classrooms in New Mexico.

“We’re digging education into a hole because of Covid-19,” Democratic Sen. Mimi Stewart of Albuquerque warned. “You cannot teach kids if they are not in school.”

Many Republican lawmakers said the budget revisions do not go far enough.

“We are not really cutting and not getting to a point that is really fiscally responsible,” Republican state Sen. Cliff Pirtle of Roswell said before voting against the budget bill.

House deliberations stretched into Saturday evening on police accountability reform efforts, newly proposed civil rights protections for minorities and emergency election reforms.

A Senate-approved bill awaited a House vote to ensure state agencies assess policies for preventing racism in hiring, employee retention, pay equity, community engagement and workplace participation.

The bill from Democratic Sen. Linda Lopez, Rep. Javier Martinez and others also would track workforce racial and ethnic demographics in state government and require anti-institutional racism training.

Democratic Gov. Michelle Lujan Grisham has encouraged legislators to seize the momentum of demonstrations set off by George Floyd’s killing at the hands of Minneapolis police to enact policing reforms and a safeguard civil rights guarantees.

About 30 people gathered outside the Statehouse in solidarity with the Black Lives Matter movement.

Other special legislative session bills would mandate police body cameras, track instances of excessive force by law enforcement and allow special prosecutors to investigate police misconduct.

A bill was awaiting the governor’s signature that would appoint a commission to consider changes to qualified immunity provisions that protect police officers from lawsuits, allowing them to be sued for misconduct.

Another bill focuses on improving the reliability of absentee balloting in elections and would bolster access to Election Day polls on Native American lands.

Separately Gov. Michelle Lujan Grisham’s already has convened a council on racial justice to prepare an anti-racism agenda for consideration by legislators in 2021.