Permanent or rainy day?

Some supporters of the effort to increase spending on early childhood programs say addressing such needs should be the top priority for the state’s permanent funds.

Senate Majority Leader Michael Sanchez, D-Belen, said the state’s $11.45 billion Land Grant Permanent Fund should be put to work rather than just being salted away.

“I understand you’re protecting the fund because it’s the people’s money, but you’re investing it in people and you’re investing it into our state,” Sanchez said. “And we’re not raiding it every year.”

Sanchez is the sponsor of Senate Joint Resolution 3, the proposed constitutional amendment to divert more money from the permanent fund to expand early childhood education. The fund’s investment already provides money for New Mexico education, but Sanchez and others are seeking more and would earmark it for early childhood education.

“To me, people are far more important than a (permanent fund) corpus,” Sanchez said. However, Sanchez said he believed the increased distribution rate would not affect the principal, or corpus, of the fund.

Opponents of the new spending say the push to tap into the permanent fund to afford expanded state programs reflects a growing effort to use the state permanent funds as “rainy-day” funds set aside for emergencies.

Treating the Land Grant Permanent Fund as a rainy day fund, opponents of the new distributions say, also would ignore the intent of Congress when New Mexico’s permanent fund was created through statehood-era land transfers. New Mexico now maintains the permanent fund with leases, rents and royalties it receives from use of those lands, along with investment earnings.

“This fund came about many, many years ago in the wisdom of our forefathers, and they had the self-discipline to maintain distributions below 5 percent,” said state House Minority Leader Donald Bratton, R-Hobbs.

“Now in the last decade, we didn’t do that, so the message we’re sending to our forefathers and to future generations is we felt like we were entitled to more than our share,” Bratton said.
— This article appeared on page A9 of the Albuquerque Journal