New Mexico lawmakers reach budget deal as tense session ends

SANTA FE, New Mexico — New Mexico legislators forged a budget agreement Thursday that increases annual spending on government programs and school districts by more than a half-billion dollars, with new investments in early childhood education and college scholarships in a state afflicted by high rates of childhood poverty.

The state House endorsed a $7.6 billion general fund budget for the fiscal year starting July 1. It raises annual spending by $536 million, or nearly 8% — sending the bill to the governor’s desk. The move came hours before lawmakers ended the 30-day session Thursday.

The budget sets aside $17 million toward an initiative by Democratic Gov. Michelle Lujan Grisham that might eventually provide tuition-free education at public colleges to most students.

But fully funding the so-called opportunity scholarship for 55,000 in-state students would require a much larger appropriation of $45 million annually, according to the governor’s office.

Initial scholarships are reserved for full-time students pursuing two-year certificates of associate degrees, under language in the budget. Republican Sen. Cliff Pirtle of Roswell said former high school and college dropouts would unfairly be left out.

The budget bill also places $320 million in an endowment fund designed to underwrite early childhood education programs with future investment earnings.

Record-breaking oil production in the southeastern corner of the state is behind an anticipated $800 million increase in state government income during the coming budget year. The windfall has only increased concerns that a recession or oil bust would quickly erode public finances.

The surplus allowed lawmakers to increase spending on public schools by $216 million, or nearly 7%, to $3.5 billion for the coming school year. Salary hikes of 4% were approved for most teachers, public school staff, faculty and state government workers.

Legislators sent a bill to the governor that would pick up the tab for reduced-price lunches that are available to students living on the cusp of poverty.

Lujan Grisham can veto any portion of the budget or the entire bill.

With the entire Legislature up for election this year, leading Democratic lawmakers expressed pride in a decision to increase state spending in key areas.

“We are making big investments,” said Democratic House Speaker Brian Egolf. “We came into this Legislature after the 2018 election with a commitment that we would take the unprecedented budget surpluses, take these resources and invest them where they’re needed most — into our children, through education and health care, and into our economy.”

Rep. Jane E. Powdrell-Culbert, R-Corrales, said House Republicans were “declaring war” against Democrats in the 2020 election. GOP House Minority Whip Rod Montoya vowed Republicans would highlight the red-flag gun law and the state spending increase in a bid to woo voters and to try to take control over the House.

Rep. Gail Armstrong, R-Magdalena, said she was angry that Democrats didn’t take up her bill to eliminate state taxes on Social Security payouts.

“I’m leaving the Legislature a little wounded,” she said.

At a news conference, Lujan Grisham graded the session as an “A plus” for investments in children and education. She still backs legalizing recreational marijuana, which stalled in the legislature, noting it’s possible by constitutional amendment and a statewide vote.

In the session’s final hours, legislators fulfilled several policy initiatives backed by the governor on health care, public safety and economic development.

A rooftop solar tax credit that expired in 2016 was reinstated to offset up to $6,000 for households and businesses that install solar energy systems. Another bill would place a monthly $25 cap on the amount diabetes patients pay monthly for insulin.

On matters of public safety, the governor called for 60 new state police officers, and says she received funding for 40.