Governor signs budget solvency fix, vetoes some cuts - Albuquerque Journal

Governor signs budget solvency fix, vetoes some cuts

Rep. Patricia Lundstrom, D-Gallup, and Legislative Finance Committee Director David Abbey, lower left, answer questions about a budget solvency bill during a recent legislative special session. Gov. Michelle Lujan Grisham signed the bill into law Tuesday. (Eddie Moore/Journal)

Copyright © 2020 Albuquerque Journal

SANTA FE – On the day before the start of the state’s new fiscal year, Gov. Michelle Lujan Grisham on Tuesday signed into law a budget fix that will keep New Mexico state spending levels roughly flat – at least for now – amid the coronavirus pandemic.

However, the Democratic governor used her line-item veto authority to avoid some funding rollbacks proposed by lawmakers during a recent special session – for public education programs and an expanded college scholarship initiative, in particular.

As a result of Lujan Grisham axing more than $30 million in proposed spending reductions, the state would end up with about 11.3% of total state spending in reserves – or less than half the $1.9 billion that was projected in February.

“We must recalibrate our state’s budget to meet these challenging times,” the governor said in an executive message to legislative leaders. “However, we should not lose sight of the important work that is still needed to create lasting opportunities for all New Mexicans, so that we may be prepared for the challenges that lie ahead.”

The solvency legislation, House Bill 1, relies on a mix of federal funds, cash reserves and one-time budget maneuvers to avoid steep spending cuts.

It was approved during a June special session in response to a projected $2 billion drop in revenue during the budget year that starts Wednesday.

That revenue decline is due to a double whammy of the pandemic and sharply lower oil prices, which have combined to upend the state’s economy and evaporate a projected budget surplus.

However, some state programs will actually receive slight funding increases even with the solvency plan, which keeps state spending at about $7 billion instead of growing it to $7.6 billion as had been planned in February.

That includes public education, as the governor used her veto pen to strike a proposed $8 million reduction for culturally and linguistically appropriate textbooks and curriculums.

She also left $10 million for the Opportunity Scholarship program for college students in two-year programs – up from the $5 million proposed by the Legislature – and voided a proposed $5 million reduction for the fledgling Early Childhood Education and Care Department.

“Given the crisis that has enveloped us and the hard decisions that have had to be made, I’m proud that we have prudently, wisely used all our resources to maintain our forward trajectory, especially for education, while also keeping a clear eye on the future,” Lujan Grisham said.

Some Republican lawmakers have argued that recent increases in state spending – including a 12% increase last year — – have put New Mexico on dangerous financial footing.

And House GOP floor leader James Townsend of Artesia on Tuesday accused Lujan Grisham of “social distancing from reality.”

But top-ranking Democrats have said the recent spending increases were necessary to bolster state programs that had faced cuts or limited budget growth under the administration of Lujan Grisham’s predecessor, former Gov. Susana Martinez, a Republican.

Rep. Patricia Lundstrom, D-Gallup, chairwoman of the House Appropriations and Finance Committee, said Tuesday that this year’s solvency bill attempts to protect state funding in key areas.

“We’ve learned from previous downturns that we cannot kick the stool out from under New Mexicans and expect a strong recovery,” Lundstrom said.

In addition to drawing down state reserves and paring back state spending, the solvency bill relies on $750 million that New Mexico received under the federal CARES Act.

Lujan Grisham used her line-item veto authority to strike down the Legislature’s plan to distribute that money. It’s up to the governor, not lawmakers, to determine how federal funds are spent, Tripp Stelnicki, a spokesman for the governor, said Tuesday.

Sen. Steven Neville, R-Aztec, said Tuesday that deeper cuts could have been mandated under the solvency bill due to the state’s uncertain financial outlook.

But he said the final version of the legislation avoids tax increases and furloughs or layoffs of teachers and state employees.

It also provides pay raises averaging 1% to teachers and other school workers and similar salary increases to state workers making less than $50,000 annually.

“I didn’t like it, but it was the best compromise we could come up with,” Neville told the Journal, referring to the solvency measure.

He and other lawmakers say additional budgetary belt-tightening will likely be necessary when the Legislature reconvenes for a 60-day regular session in January.

Home » Journal North » Journal North Recent News » Governor signs budget solvency fix, vetoes some cuts

Insert Question Legislature form in Legis only stories

Albuquerque Journal and its reporters are committed to telling the stories of our community.

• Do you have a question you want someone to try to answer for you? Do you have a bright spot you want to share?
   We want to hear from you. Please email

taboola desktop

ABQjournal can get you answers in all pages


Questions about the Legislature?
Albuquerque Journal can get you answers
Email addresses are used solely for verification and to speed the verification process for repeat questioners.
Two summer programs return to NM Museum of Natural ...
ABQnews Seeker
why not? The New Mexico Museum ... why not? The New Mexico Museum of Natural History & Science is returning two of its popular programs — Mineral Mondays and Relaxed Nights. ...
No more 'Breaking Bad' — Rebel Donut to close ...
ABQnews Seeker
Beloved Albuquerque doughnut shop Rebel Donut ... Beloved Albuquerque doughnut shop Rebel Donut is closing its doors next week on Thursday, June 15.
Albuquerque Police ID three young men killed at house ...
ABQnews Seeker
Police believe that multiple guns were ... Police believe that multiple guns were fired during a weekend house party to celebrate recent graduations and a birthday. Three men were killed and ...
Investigation Discovery's 'Late Night Lockup' to premiere, features Albuquerque ...
ABQnews Seeker
Police officers encounter human behavior all ... Police officers encounter human behavior all the time. Yet, it's during the late night hours where things can get strange. Investigation Discovery's six-part series, ...
New Mexico's largest credit union Nusenda moves to expand ...
ABQnews Seeker
Once complete, the addition of Western ... Once complete, the addition of Western Heritage's branches - it has one in Las Cruces, one in Deming and four in El Paso - ...
The meaning of justice to victims vs. law's goal
ABQnews Seeker
On the day he was murdered, ... On the day he was murdered, Bangladeshi geology professor Taher Ahmed interrupted his visit with his adult children in Dhaka, the nation's capital and ...
‘Weak mayor’ proposal sets up possible 10-member City Council
ABQnews Seeker
Councilors deferred until June 21 a ... Councilors deferred until June 21 a proposal that would reshape Albuquerque's government
Camp in session: UNM basketball players get experience coaching ...
ABQnews Seeker
Monday, at the Pit, 75 3rd ... Monday, at the Pit, 75 3rd through 7th graders were wide eyed and excited to be learning from their favorite Lobo basketball stars.
Can rivalry games be saved? UNM, NMSU swap facility ...
ABQnews Seeker
Amid a rare offseason flare-up of ... Amid a rare offseason flare-up of rivalry drama, UNM and NMSU on Monday made progress toward getting their hoops rivalry going again.