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Plan to tap permanent fund stalls in Senate

Gov. Michelle Lujan Grisham and Sen. Linda Lopez, D-Albuquerque, announce a new bill to boost early childhood programs on Monday. (Eddie Moore/Albuquerque Journal)

Copyright © 2019 Albuquerque Journal

SANTA FE – A proposal to take more money from New Mexico’s largest permanent fund for early childhood programs hit a brick wall again in the Roundhouse on Monday, when three Senate Democrats joined with Republicans to block it from moving forward.

But Gov. Michelle Lujan Grisham said later in the day that she’s not giving up the fight and threw her support behind a scaled-back measure.

The first-term Democratic governor acknowledged she had no commitments from Senate leaders that the new proposal would pass before lawmakers wrap up a 60-day session March 16, but she suggested it could be more palatable to some lawmakers.

“This gives us a renewed opportunity to continue this very important conversation,” Lujan Grisham told reporters.

Earlier in the day, the Senate Rules Committee voted 7-4 to table a proposed constitutional amendment, House Joint Resolution 1, that calls for the annual distribution rate from the $17.7 billion Land Grant Permanent Fund to go up by 1 percentage point – from 5 percent to 6 percent – into perpetuity.

That would generate an estimated $170 million for early childhood programs during the 2022 budget year, the earliest it would likely be in place, according to a fiscal analysis of the legislation.

But the vote to table the House-approved proposal means it’s unlikely to resurface during this year’s session. That left some supporters fuming.

Sen. Gerald Ortiz y Pino gestures before the Senate Rules Committee voted to table a measure to take more money from the Land Grant Permanent Fund to support early childhood education. (Eddie Moore/Albuquerque Journal)

” ‘Let’s just let the kids sink’ is our attitude,” said Sen. Gerald Ortiz y Pino, D-Albuquerque, who described himself as exasperated by the vote.

Backers, including the state’s Catholic bishops, have pushed for nearly a decade to take more money from the permanent fund – which this year is distributing more than $780 million for public schools and other programs – for various early childhood initiatives.

They argue that a cash infusion into programs benefiting the state’s youngest residents is needed now, given that New Mexico is grappling with chronically high poverty rates and a string of high-profile child abuse cases.

But opponents of the idea, which include the Greater Albuquerque Chamber of Commerce, have raised concerns the plan would undermine the fund’s long-term health. They also point out the state has already ramped up spending on early childhood programs in recent years.

Specifically, total New Mexico spending on child care assistance, home visiting, prekindergarten and other programs has gone from $136.5 million in 2012 to $313.2 million in the current budget year.

Under the revised proposal unveiled by Lujan Grisham and sponsored by Sen. Linda Lopez, D-Albuquerque, the distribution rate from the permanent fund would go up by a smaller amount – just 0.5 percentage points instead of 1 percentage point.

That proposal, Senate Bill 671, was brought forward using the “dummy bill” process – in which placeholder bills are amended after the bill introduction deadline – and could be voted on in a different Senate committee by as soon as Wednesday.

Allen Sanchez, president of CHI St. Joseph’s Children, speaks in favor of a measure to take more money from a state permanent fund for childhood education in a Senate committee hearing Monday. (Eddie Moore/Albuquerque Journal)

But it’s unclear whether it will fare any better than the other measure, as Republican legislators and some Senate Democrats have shown a reluctance to tap into the permanent fund.

Democratic Sens. Bill Tallman of Albuquerque, Clemente Sanchez of Grants and Mary Kay Papen of Las Cruces voted with Republicans on Monday to table the original proposal. Sanchez and Papen also voted against a similar measure in 2017.

A State Investment Council analysis of the tabled proposal forecast that the permanent fund would continue to grow over the next 20 to 30 years even at the higher distribution rate, due to expectations of strong tax and royalty inflows from the oil and natural gas industry during that period.

But the analysis also concluded the permanent fund would distribute more money to schools and other beneficiaries in the long run if it remained at the current 5 percent level, given the expectation that the fund would grow more rapidly at the lower distribution rate.

“In 30 years, would we rather have $8 million more (in the fund) or an entire generation of New Mexico kids that had access to universal prekindergarten?” asked Rep. Antonio “Moe” Maestas, D-Albuquerque, one of the proposal’s co-sponsors.

Meanwhile, Monday’s vote comes just two days after the Senate voted 39-2 in favor of legislation to create a new early childhood education department in state government.


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