New Mexico First Blog

New Mexico First Policy Domains Special Session Overview

House Bill 1

Overview 

  • While HB 1 awaits review by Governor Michelle Lujan Grisham and it hasn’t been signed into law as of 6/24/20, the information below highlights decisions made by our volunteer legislators in the New Mexico House of Representatives.
  • We appreciate the uncertain and challenging economic decisions that needed to be made and the thoughtful approach to sharing the responsibility of addressing budget constraints, using federal CARES Act relief dollars judiciously, and leaving nuanced decisions about how to address sanding to state agencies who have the most nuanced understanding of emerging and existing needs and priorities.
  • We appreciate the difficulties and challenges related to health and safety during the special session and the incredible acts of service demonstrated by our Representatives.
  • While HB1 addressed policy areas comprehensively, New Mexico First focuses in the following policy domains, and this overview is targeted to those areas: health, education, economic development, natural resources, good government, and agricultural resilience and healthy local food systems.

Highlight

HB 1

  • Reduced General Fund Appropriations by $704.7M
  • Focuses on how to use federal relief funding through the CARES Act
  • $417M of the cuts will be recurring savings

SB 5

  • $141M in savings
  • Maintaining funding where money was being leveraged and matched with other investments

What is sanding a budget?

The New Mexico State Legislature has passed budgets for consideration to Governor Lujan Grisham’s office. Sanding involved making cuts to each agency.Each agency has the discretion to apply the budget cuts with guidance from the Department of Finance and Administration.

In Section 17 of HB1 DFA was given authority to double the percentage of sanding if the collection of revenue falls short of the estimates used for budget development.Additional sanding may ensue for FY 21 based on actual revenues.

Additional Appropriations Reductions and Changes

These targeted budget cuts reflect specific reductions and changes in state agency budgets to program support and/or specific initiatives.

What does the CARES Act have to do with New Mexico’s Budget?

  • $130M of the CARES Act dollars will be used to pay for eligible expenses from addressing COVID-19
  • $150M will be allocated proportionally by the Department of Finance and Administration to counties with populations less than 500K based on Census information to pay for expenditures related to addressing COVID-19
  • An additional $15M will be allocated to Cibola, McKinley, and San Juan Counties to pay for expenditures related to addressing COVID-19
  • An additional $23M will be allocated to Tribal/Pueblo Nations to pay for expenditures related to addressing COVID-19
  • $750M will be transferred to the fiscal year 2021 to pay for eligible expenditures related to addressing COVID-19

Health

Sanding

  • 6% reductions to state agencies from the General Fund unless stated otherwise
    • 3% reductions in the Human Service Department from the General Fund in Medical Assistance, Medicaid, and Behavioral Health
    • 2% reduction in the Department of Health from the General Fund

Additional Appropriations Reductions and Changes

  • $17M decrease in Medical Assistance in the Human Services Department which is countered by a transfer to the Department of Finance and Administration and back to the Human Services Department from the Tobacco Settlement Funds
  • $572.6K decrease in program support in the Human Services Department
  • $500k decrease for behavioral health in the Human Service Department
  • $2.4M decrease for Developmental Disabilities Support for the Department of Health
  • $600K decrease in program support for the Department of Health
  • $1M decrease for Protective Services in the Children Youth and Families Department
  • $500K decrease in program support to Children Youth and Families Department

General Fund Budget Reductions to be Funded with CARES Act Federal Funding

  • $7M reduction to the Department of Health from the General Fund to be replaced with federal CARES Act funding
  • $75M reduction to the Human Services Department from the General Fund to be replaced with federal CARES Act funding
  • $1.2M from the UNM Health Sciences Center from the General Fund to be replaced with federal CARES Act funding

General Fund Budget Reductions

  • $1M reduction to the Aging and Long Term Services Department for the Kiki Saavedra Senior Dignity Fund
  • $400K reduction to the Department of Health for the Department of Health hospital master planning assessment
  • $3M reduction to the Department of Corrections for hepatitis C treatment and planning
  • $750K to the Department of Corrections for the planning phase to implement electronic medical records

Education

Sanding

Early Care and Education

K-12

  • 6% decrease to the Public Education Department for special appropriations

Higher Education

  • 6% decrease to Higher Education

Community Education

  • 6% decrease to Regional Education Cooperative System

Additional Appropriations Reductions and Changes

Early Care and Education

  • $3.3M decrease in the early childhood education and care program in the Early Childhood Education and Care Department
  • $1M decrease in public Pre-K in the Early Childhood Education and Care Department
  • $671.4K decrease in program support in the Early Childhood Education and Care Department
  • The Department of Finance and Administration Early Childhood Endowment Fund is transferred to the Early Childhood Education and Care Fund and reduced by $20M.

Higher Education

  • $7M decrease for the Opportunity Scholarship in the Higher Education Department

General Fund Budget Reductions to be Funded with CARES Act Federal Funding

Early Care and Education

  • $5M decrease in the Early Childhood Education and Care Departmentto be replaced with federal CARES Act funding 

K-12

  • $44.6M decrease in the Public Education Department to reflect funding from the Elementary and Secondary School Emergency Relief Fund
  • $10M decrease in special appropriations to the Public Education Department in proportion to each special appropriations from the Governor’s Education Relief Fund

Higher Education

  • $18,795,000 decrease in general purpose funds appropriation to each public higher education institution to be replaced with federal CARES Act funding
  • Decrease in the general fund allotment for instruction and general purpose revenue to public institutions of higher education by the percentage of the amount received by each institution from the CARES Act

 

Additional Public School and Public Education Reductions and Changes

  • $30M reduction from the Public Education Department Education Reform Fund for K-12 Plus Programs and compliance with the K-5 Plus Act
  • $8M reduction from the Public Education Department Education Reform Fund for culturally and linguistically appropriate instructional materials and curriculum
  • $5M reduction from the Public Education Department Education Reform Fund for a pilot extended summer learning program in historically defined “Indian impacted” school districts or charter schools (including early childhood)
  • $4.5M reduction from the Public Education Department Education Reform Fund for instructional materials
  • $3M reduction from the Public Education Department Education Reform Fund for a school budget transparency website
  • $2.9M reduction from the Public Education Department Education Reform Fund for school improvement grants
  • $750K reduction from the Public Education Department Education Reform Fund for a statewide special education convening
  • $1M reduction from the Public Education Department Education Reform Fund for teacher placement in hard to place schools
  • $1M reduction from the Public Education Department Education Reform Fund for teacher residencies
  • $146.2M reduction to the state equalization guarantee from general fund appropriations
  • $6M reduction in elementary physical education
  • $119.9M reduction for K-5 plus program to $79.9M for the K-5 plus program
  • $10M reduction in evidence-based literacy interventions and literacy collaboratives to $8M
  • the $59.2M to provide an average 4% increase to all teachers and the $33.4M to provide an increase to non-teaching school personnel are reduced and no additional funding will be allocated.General Funds appropriations to the state equalization guarantee distribution may be used to provide an average 1% salary increase for all school personnel other than licensed administrators and other unlicensed personnel. Plans detailing how salary increases will work must be submitted to PED.
  • The Public Education Department Secretary is empowered to determine the value of the K-5 plus units based on guidance in the House Appropriations Bill
  • $5.6M reduction in general fund appropriation to education transportation
  • $1.6M reduction in general fund appropriation to school transportation personnel
  • School districts and charter school shall not pay more than a 6% increase in group health insurance premiums
  • $4M reduction from 2020 general funds appropriation to supplemental distribution, dual-credit instructional materials, Indian education fund and standards-based assessments
  • $3.4M proportional reduction from 2020 general funds to the public education department special appropriations
  • $10M reduction to the Higher Education Department for low-income scholarships including the Opportunity Scholarship and the Teacher Preparation Affordability Scholarship
  • $2M reduction in General Fund appropriation to the Public School Insurance Authority to pay claims

Economic Development

Sanding

  • 6% decrease to Economic Development Department

Additional Appropriations Reductions and Changes

  • $1.1M decrease in Income Support Division of the Human Services Department
  • $600K decrease to marketing and promotion in the Department of Tourism
  • $500K decrease in the economic development program in the Department of Economic Development
  • $600K decrease in the Spaceport Authority

General Fund Budget Reductions to be Funded with CARES Act Federal Funding

  • General Appropriations were reduced by $500K for Economic Development
  • Income support was reduced by $1.27K to the Human Services Department to be replaced with federal CARES Act funding

General Fund Reductions

  • $300K reduction to the Economic Development Department for a 20 year plan
  • $1.5M to the Economic Development Department for economic development projects in McKinley and Cibola counties (includes reductions to the New Mexico Institute of Mining and Technology, the University of New Mexico, and the resources for theLocal Economic Development Act)
  • $5M reduction to the Economic Development Department for economic development projects within the Local Economic Development Act 
  • $1M reduction to the Economic Development Department for the job training incentive program

Natural Resources

Sanding

  • 6% decrease to each state agency with any authority/responsibility related to natural resources

Additional Appropriations Reductions and Changes

  • $400K reduction to the Office of the State Engineer
  • $400K reduction to the Water Protection Program in the Environment Department

General Fund Budget Reductions

  • $500K reduction in the Energy Minerals and Natural Resources Department to promote investments in clean energy
  • $10M reduction to the State Engineer for the Interstate Stream Compact Compliance Program and Water Management Pilot Project in the lower Rio Grande
  • $500K reduction to the Office of Natural Resources Trustee Fund
  • $1.5M reduction to the Department of the Environment for enterprise environmental information systems

 

Good Governance

Sanding

General Fund Budget Reductions to be Funded with CARES Act Federal Funding

  • $500K reduction to the Secretary of State for Elections

Agricultural Resilience

Sanding

  • 4% decrease to the New Mexico Department of Agriculture Budget
  • 4% decrease to NMSU Cooperative Extension
  • 4% decrease to NMSU Agricultural Experimentation Stations

General Fund Budget Reductions

  • $1.8M reduction to New Mexico State University for the Soil and Water Conservation Commission for the Pilot Agriculture and Natural Resources Grant Program

* A similar overview of SB5, will also be shared.

 

 


Senate Bill 5

Overview 

  • While SB5 awaits review by Governor Michelle Lujan Grisham and it hasn’t been signed into law as of 6/24/20, the information below highlights decisions made by our volunteer legislators in the New Mexico Senate.
  • We appreciate the uncertain and challenging economic decisions that needed to be made and the thoughtful approach to share the responsibility of addressing budget constraints, using federal CARES Act relief dollars judiciously, and leaving nuanced decisions about how to address financial reductions to state agencies who have the most nuanced understanding of emerging and existing needs and priorities.
  • We appreciate the difficulties and challenges related to health and safety during the special session and the incredible acts of service demonstrated by our Senators.
  • While SB5 addressed policy areas comprehensively, New Mexico First focuses on the following policy domains and this overview is targeted to those areas: health, education, economic development, natural resources, good government, and agricultural resilience and healthy local food systems.

SB 5 Highlights

SB 5

  • $141M in savings
  • Maintaining funding where money was being leveraged and matched with other investments

Definitions

  • Super Sweep: The issuance of short-term bonds above the amount that is typically allowed in statute to intercept the amount that would otherwise transfer to the associated permanent fund.
  • Sponge Bonds: Short-Term Severance Tax Bonds.

Health

General Fund Budget Reductions

  • $1,000,000 reduction from the local DWI grant fund.  
  • $2,000,000 reduction from the enhanced 911 fund. 
  • $4,000,000 reduction from the public liability fund. 
  • $750,000 reduction from the medical cannabis fund. 
  • $2,000,000 reduction from the corrective action fund. 
  • $3,000,000 reduction from the primary care capital fund of the New Mexico Finance Authority. 
  • $2,000,000 transfer from the executive order fund of the Homeland Security and Emergency Management Department to the appropriation contingency fund of the general fund.  

Education

Capital Outlay Budget Reductions

  • $743,000 reduction from capital projects of the Public Education Department.
  • $1,060,000 reduction from capital projects of the Higher Education Department.
  • $650,000 reduction from capital projects of Eastern New Mexico University.

General Fund Budget Reductions

  • $1,000,000 reduction from the New Mexico Youth Conservation Corps fund.
  • $2,000,000 reduction from the College Affordability Endowment fund.
  • $2,000,000 reduction from the student financial aid special program fund of the Higher Education Department.

Public School Capital Improvement Act

  • The Public School Capital Improvement Act, which would have increased the state funding match for capital improvements among schools with at risk populations, was repealed and is no longer active.

Economic Development

Capital Outlay Budget Reductions

  • $100,000 reduction from the capital projects of the Economic Developmental Department.
  • $733,750 reduction from the capital projects of the Department of Transportation.
  • $5,378,993 reduction from the capital projects of the Local Government Division.
  • $575,000 reduction from the capital projects of the Indian Affairs Department.

General Fund Budget Reductions

  • $1,000,000 reduction from the public property reserve fund.

State Transportation Project Bonds

  • The 2019 state budget allocated $250,000,000 for major investment projects of the Department of Transportation. Of that amount only $13,000,000 was spent. The state reduced the appropriated amount by $75,000,000 to be returned to the general fund.
  • The state will allow the Department of Transportation to sell state transportation project bonds up to a maximum revenue amount of $75,000,000.

Natural Resources

Capital Outlay Budget Reductions

  • $2,275,000 reduction from the capital projects of the Department of Environment.

General Fund Budget Reductions

  • $2,500,000 reduction from the drinking water state revolving loan fund of the New Mexico Finance Authority.

Short-Term Severance Tax Bonds

  • The state will sell sponge bonds with terms that do not extend beyond the fiscal year, above the amount that is typically allowed in a super sweep.
  • Revenue from the sold sponge bonds will be allocated to the following prioritized funds:
  • 9% of proceeds allocated to the Water Project Fund.
  • 4.5% of proceeds allocated to the Tribal Infrastructure Project Fund.
  • 4.5% of proceeds allocated to the Colonias Infrastructure Project Fund.
  • Remaining proceeds will be allocated to other authorized projects that are well developed and time efficient, from fiscal years 2018, 2019, and 2020.

Good Governance

General Fund Budget Reductions

  • $1,000,000 reduction from consumer settlement fund of the Attorney General’s office.
  • $2,000,000 reduction from the local government planning fund of the New Mexico Finance Authority.

Agricultural Resilience

General Fund Budget Reductions

  • $5,300,000 reduction from the water project fund of the New Mexico Finance authority.
  • $4,000,000 reduction from the Rural Infrastructure revolving loan fund.

 

 

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