The 2025 New Mexico legislative session begins January 21 and ends on March 22, 2025. It is referred to as the 60-day long session where legislators are free to introduce what they want unlike 30 day sessions limited to what the Governor places on the agenda.
On January 10, Speaker of the House Javier Martinez accompanied by House Majority Leader Szczepanski, D-Santa Fe, House Majority Whip Dayan Hockman-Vigil, D-Alb., and House Judiciary Committee Chairwoman Rep. Christine Chandler, D-Los Alamos, held a press conference in Albuquerque’s historical Martineztown to discuss the top priorities Democrats intend to address during the upcoming 2025 legislative session. Democrats are entering the 2025 session with a 43-26 majority in the House.
The Democratic House leadership are proposing a wide ranging agenda that includes legislation to improve public education, boosting the state’s economy, public safety initiatives, tax relief and creation of an of an independent office of the Child Advocate with the New Mexico Department of Justice. The only major announcements on what to do with the state’s historic revenue surplus dealt with the state’s behavioral health system and tax relief. Nothing was said about using the historic surplus for major capital improvement or infrastructure outlays.
BREAKDOWN OF PROPOSED LEGISLATIVE AGENDA
Following is a summary of the proposed legislative agenda as proposed by the Democrat House leadership:
PUBLIC SAFETY
- Continued investments in law enforcement and communities to address root causes of crime.
- Addressing juvenile crime.
- Reducing gun violence.
- Tightening up DWI laws and addressing reckless drivers who endanger New Mexicans.
- Increasing punishments for certain heinous crimes like human trafficking and improving our services for victims of these crimes.
- Increasing penalties for fentanyl traffickers.
- Creating more avenues for people involved in our criminal justice system who are in need of treatment to get the help they need.
- Putting a $200 million down payment on rebuilding New Mexico’s behavioral health infrastructure.
CHILD WELL-BEING
- Continued investments in education, from cradle to career.
- Creating an independent Office of the Child Advocate within the New Mexico Department of Justice to better protect children’s rights to privacy, health care, and education.
- Demanding greater accountability, transparency, and oversight from the Children, Youth and Family’s Department (CYFD).
ECONOMIC RELIEF/AFFORDABILITY
- Investing in New Mexico communities and supporting their small, local businesses.
- Investing significantly in improving access to affordable housing and healthcare.
- Relieving the pressures of inflation by cutting taxes for middle-class
- https://www.youtube.com/watch?v=0CKZGnwR4cYNew Mexicans, so people can keep more of their hard-earned dollars
A link to the quoted news source is here:
https://www.koat.com/article/new-mexico-2025-legislative-session/63397777
FILLING IN THE GAPS
During the January 10 press conference Speaker of the House Javier Martinez said much of the legislation proposed will prioritize making New Mexicans safer. Speaker Martínez said this:
“This legislative session we will be focusing on making life better and more affordable for you and your family.”
REFORMING CYFD
One major priority announcement that is sure to cause controversy with Governor Michelle Lujan Grisham is reform of the beleaguered Children Youth and Family Department (CYFD). The Governor has strenuously opposed similar measures in recent years.
Speaker Martinez revealed House Democrats are planning to address the longstanding issues at the CYFD and the way the embattled state department handles child abuse cases. Martinez says it’s time to bring in oversight with a new Office of the Child Advocate inside the New Mexico Department of Justice.
Speaker Martínez said this:
“The agency is broken, and our children need help. We will propose the creation of an independent office of the child advocate within the New Mexico Department of Justice and we will bring and demand greater accountability, transparency, and oversight from this critically important agency. … The idea behind the Office of a Child Advocate is to have an independent voice for those children and not require a full out lawsuit to be able to get data, to get information, to get, sometimes, just basic facts of a particular case.”
Reforming CYFD is not a new idea. State Senate Republican lawmakers have been calling for increased CYFD oversight for past few years but faced serious hesitation from Democrat leaders and strong opposition from Gov. Michelle Lujan Grisham.
PUBLIC SAFETY
The 4 Democratic House leaders made it clear that a top priority for the upcoming session is public safety. This includes supporting law enforcement and investing money into communities to address crime at its roots. Rep. Christine Chandler, D-Los Alamos, the House Judiciary Committee’s chairwoman, said House Democrats will push for crime-related proposals during the 2025 legislative session including tougher penalties for human trafficking, shooting threats and fentanyl distribution.
Chandler said the following will be top priorities:
- Changes to the juvenile justice system and prevention of youth crime
- Changes to the state’s red flag gun law, which allows law enforcement to temporarily seize weapons from individuals deemed to pose a threat to themselves or others,
- A push to tighten DWI laws
- Increasing punishments for crimes related to human trafficking
Rep. Christine Chandler said this:
“Our efforts in the upcoming session will be focused on holding violent criminals accountable, preventing recidivism, [and] improving our behavioral health care and substance use treatment systems. … We all know how much more work needs to be done. … We expect much of this agenda to make its way quickly through both chambers and to the governor’s desk. … Addressing juvenile crime to prevent our youth from becoming involved in crime, whether as victims or as perpetrators, reducing gun violence by making necessary red flag laws, and addressing gun threats in our schools.”
BEHAVIORAL HEALTH
The 4 Democratic House leaders announced efforts to address behavioral health. They said they are ready to rebuild New Mexico’s behavioral health system, something that has been asked for by city and state leaders in recent years especially to deal with the homeless.
State Rep. Reena Szczepanski, the new House Floor Leader, said House Democrats are proposing a $200 million investment to increase capacity and address a backlog of behavioral health patients across the state and to provide mental health and substance abuse treatment programs.
Szczepanski said $200 million from a the state’s historic revenue windfall could be earmarked for improving the state’s behavioral health system. The $200 million would be deposited in a new state trust fund and could be used to build new facilities and recruit additional providers. Szczepanski described the state’s current behavioral health facilities as understaffed and overwhelmed and she said this:
“No one should have to make 10 calls for an appointment for themselves or for a loved one. … “We’re starting to make progress strengthening those systems, but we’re still a long way from where we need to be. This is a wrong that we must make right. Every New Mexican should be able to get help when and where they need it.”
Speaker Javier Martinez for his part said the behavioral health-related bills will be prioritized in the first 30 days to make sure lawmakers have time to get them to the governor’s desk before the session ends.
TAX RELIEF
During the January 10, press conference, the House Leadership said the state’s budget surplus could be used to provide tax relief to New Mexicans, and they said they will push specifically for tax cuts for middle-income residents. Those changes could include an expansion of a tax break called the Low-Income Comprehensive Tax Rebate, which is currently offered to individuals with a modified gross income of $36,000 or less per year.
Links to relied upon or quoted news sources are here:
https://www.koat.com/article/new-mexico-2025-legislative-session/63397777
https://www.abqjournal.com/news/article_5d3a9652-cf7d-11ef-988d-831e0ce8d646.html
GOV. MLG RELEASES FISCAL YEAR 26 EXECUTIVE BUDGET
On December 13, Governor Michelle Lujan Grisham released her proposed budget for Fiscal Year 25 – 26. According to the Governor’s office, the proposed budget builds on her first 6 years in office while boosting investments in health care, child well-being and infrastructure across New Mexico.
The Governor’s budget recommendation includes $10.9 billion in recurring spending which is an increase of 5.3% over current year spending. The budget contains an additional $172 million for state employee pay raises, which includes additional compensation for New Mexico educators. The executive recommendation maintains reserves at 30.4%.
Lujan Grisham’s budget recommendation includes $3.33 billion in reserves or 30.4%, through FY26 while the State has $10.9 billion in recurring spending.
The Governor’s proposed budget includes the following major line items:
- $4.56 billion for the Public Education Department
- $2.2 billion for the Health Care Authority
- $1.4 billion for the Higher Education Department
- $365 million for the Early Childhood Education and Care Department
- $352 for the Department of Corrections
- $286 million for Children, Youth and Families Department
- $268 million for courts
- $211 million for the Department of Health
- $196 million for the Department of Public Safety
- $81 million for the Public Defender’s office
- $41.5 million for the State Engineer’s Office
- $26.3 million for the Tourism Department
- $13.5 million for the Workforce Solutions Department
The budget proposal includes $172 million for state employee pay raises. These raises are included for educators also.
ESTIMATED $892.3 MILLION IN “NEW MONEY” PROJECTED FOR STATE
On December 9, the Legislative Finance Committee (LFC) held one of its last regularly scheduled meetings before the 2025 legislative session that begins on January 21, 2025. The LFC is made up of legislators from each chamber in budget-writing committees. Senate Finance Committee chairman Sen. George Muñoz, D-Gallup, chairs the LFC. House Appropriations and Finance Committee chairman Nathan Small, D-Las Cruces, serves as vice chair.
The revenue estimates released will be used as a roadmap as lawmakers begin drafting a budget for the fiscal year that starts in July 2025. The budget surplus is part of a multi-year revenue bonanza, fueled primarily by record-high oil and natural gas productions in southeast New Mexico’s Permian Basin. New Mexico is the second-largest oil producer in the nation, behind only Texas, and oil and gas revenue make up about 35% of the state’s total revenue collections, according to legislative data. The two southeast New Mexico counties of Eddy and Lea make up one-third of the state’s gross receipts tax revenue, despite making up only about 6.3% of the state’s population.
New revenue estimates released by LFC financial analysts are projecting that legislators will have $892.3 million in “new money” available next year. The “new money” projection figure represents the difference between projected revenue and current total spending levels. The $892.3 million figure is upwards of $233 million more than was projected in August of this year. In all, the nearly $13.6 billion in projected revenue for the coming budget year is roughly $3.4 billion more than the state’s $10.2 billion budget.
While state spending has increased, lawmakers have also set aside millions of dollars from the revenue windfall in trust funds. The money in those funds is then invested for future use. An early childhood trust fund established with a $300 million appropriation in 2020 has ballooned to a projected $9.6 billion balance in the current fiscal year.
The state’s reliance on oil-generated dollars has been tempered in large part by lawmakers funneling much of the revenue bonanza into trust funds. That funding is then invested for future use. The investment earnings are set to surpass personal income taxes as the state’s second-largest revenue source this year.
HISTORY OF SURGING RFEVENUES
New Mexico revenue levels have surged to record-high levels in recent years amid an ongoing oil drilling boom. The state’s record-high levels of revenue for the past 10 years is as follows:
- 2017 — $6.5 billion
- 2018 — $6.9 billion
- 2019 — $7.8 billion
- 2020 — $8.2 billion
- 2021 — $8 billion
- 2022 — $8.8 billion
- 2023 — $10.9 billion
- 2024 — $13.2 billion
- 2025 — $13.3 billion
- 2026 — $13.6 billion
COMMENTARY AND ANALYSIS
With just a few days before the 2025 Legislative session, New Mexico House leaders are saying they’re optimistic that their proposed legislative agenda will move forward with bipartisan support. Speaker Martínez said this:
“I’m hopeful and I fully expect that compromise can be reached on … a host of a variety of issues.”
It is promising to see the New Mexico House Democrat leadership proposing legislation before the session starts. However, it was somewhat disappointing that they limited themselves to what should be done with the historic revenue surplus to the mental health system and tax relief. The 2025 New Mexico legislative session will again be hot and heavy on how to spend the historic surpluses, and they should be spent on major capital improvement projects.
There is indeed a lengthy list on what the surplus can be spent upon. The list includes:
Major infrastructure needs such as roads and bridge repair, funding for wastewater projects, dams and acequia projects, the courts, law enforcement and the criminal justice system, funding for our behavioral health care system, job creation endeavors, economic development programs, funding for the Public Employee Retirement funds to deal with underfunded liabilities and benefits should all be topics of discussion during the upcoming 2025 legislative session. All merit serious consideration and funding with the historic surplus.
NOT PUBLIC EDUCATION THIS TIME
Public education is always at the top of the list for funding. However, public education is a reoccurring expenditure that must rely on continuing taxation. During her first term, Govern Lujan Grisham undertook to fully fund the state’s efforts to reform the State’s public education system and she was highly successful. Lujan Grisham succeeded in securing over $1 Billion dollars for public education during the 2019, 2020, 2021 and 2022 legislative sessions.
In addition to the dramatic increases in public education funding, Lujan Grisham administration created the Early Childhood Department, issued mandates to the Children, Youth and Families and Public Education departments. An Early Childhood Trust Fund of $320 million was also created. The base pay for teachers has been increased by upwards of 20% and have risen to $50,000, $60,000 and $70,000 depending on the level of years of teacher experience.
Given the enormous amounts the state is now spending on education and what the state will be spending because of the enacted constitutional amendment, the $3.8 billion surplus would be better spent elsewhere and not on public education.
MAJOR CAPITAL OUTLAY PROJECTS SHOULD BE IN THE MIX
Whenever surpluses in state revenues occur, fiscal conservatives always begin to salivate and proclaim all taxation is bad and that rebates and tax reform are desperately needed and the only way to spend the surpluses. The tired and old political dogma has always been that tax revenues are the people’s money and anything in excess of what is actually needed over and above essential government services should be returned to the taxpayer. It is a short-sighted philosophy believing that only essential, basic services should be funded with taxpayer money such as public safety.
If that were the case, there would be no public libraries, no museums, no zoos, no mass transit expansions and no memorial monuments.
What all too often is totally ignored because lack of revenues are major capital outlay projects that are for the benefit of the public and that improve the overall quality of life. Roads and water projects are such priorities but are not exclusive. Given the sure magnitude of the surplus, it is likely municipalities, citizens and interest groups will be asking for funding for special capital projects such as swimming pools, parks, recreation facilities, sport facilities and entertainment venues. The Governor and the legislature should listen and fund such projects while they can.
A TRANSFORMATIVE PROJECT
On December 3, Gov. Michelle Lujan Grisham and state officials announced that the state intends to fund and move the NM State Fair grounds to a new location without identifying a new location nor cost to rebuild. $500,000 will be spent to develop a master plan for the existing 236 acre cite location. Ideas being suggested on what to do with 236 acres of prime property for development include affordable housing.
Governor Lujan Grisham announcing that the state is seeking to relocate the Expo New Mexico Fair Grounds borders on the absurd. It made dramatic press, but it was done without conferring with surrounding neighborhoods and with nothing but speculation on the economic benefits of moving the fairgrounds to another location without discussion of the ultimate cost to relocate and rebuild. Past feasibility studies have suggested the cost to relocate and rebuild the State Fair will be upwards of $1 Billion.
The highest and best use for the 236 acres of property is not affordable housing but the creation of an Entertainment and Commercial Hub that could revitalize the entire Southeast Heights and surrounding area. It would create all new commercial property areas for shops, restaurants, theaters and family entertainment venues and spur private residential redevelopment of the area. The Albuquerque Downs Racetrack and Casino occupies roughly a quarter of the state fairgrounds, it is not going anywhere and would be a critical component of the Entertainment and Commercial Hub.
The redevelopment plans for the existing Expo New Mexico property includes building of a new, modern arena to replace Tingly Coliseum that would support year-round large-scale concerts and events. The building of a multipurpose state-of-the-art arena to replace Tingly Coliseum is an investment for future generations. It’s a capital improvement project that should go forward regardless of what happens to moving Expo New Mexico.
Indeed, the 2025 legislative session could very well turn out to be a “once in a century opportunity” to really solve many of the state’s problems that have plagued it for so many decades. It should also be viewed as an opportunity to build facilities that are needed to enhance quality of life and that will have a lasting impact on the state’s quality of life for decades to come.