Copyright © 2021 Albuquerque Journal
SANTA FE – A package of bills aimed at buoying New Mexico workers, restaurants and bars hit hard by the COVID-19 pandemic is picking up steam at the Roundhouse.
A key Senate committee on Thursday approved two pandemic relief bills without dissent, including a measure that includes $600 rebates for New Mexico workers who make less than $15 per hour and a four-month tax holiday for restaurants, breweries, food trucks and other dining establishments.
That bill, along with several others, is expected to be voted on next week by the full Senate, while the House could move rapidly on additional recovery measures.
The goal, top-ranking lawmakers say, is to get the recovery package to Gov. Michelle Lujan Grisham’s desk this month so it can be signed into law.
“It’s critically important for us to move quickly with some very targeted relief,” Rep. Javier Martinez, D-Albuquerque, said during Thursday’s meeting of the Senate Finance Committee.
The pandemic and restrictions enacted in response to it by the Lujan Grisham administration in an attempt to slow the virus’ spread have taken a toll on parts of New Mexico’s economy.
Statewide, taxable gross receipts from New Mexico’s hospitality and food industries were down by more than $445 million – or 21.8% – over the previous year’s levels through the first five months of the current budget year, according to state Taxation and Revenue Department data.
Jeff Trent, the operations manager of O’Niell’s Pub in Albuquerque, said the proposed restaurant relief bill may be beneficial to some restaurants but it ultimately does not address the source of the struggles facing the restaurant industry.
“My honest opinion is that this is something that it just seems like we’re attacking a symptom and not the cause, you know, which is putting patrons in the seats,” Trent said in a Thursday interview.
He said the income from restaurants comes from filling tables, which is more beneficial than tax deductions.
“I think it could be putting a Band-Aid on a pretty heavy wound compared to actually, you know, our real life blood which for us is food and alcohol,” he said.
But several lobbyists representing small businesses and restaurants testified in support of the bills during Friday’s meeting.
In addition to Senate Bill 1, the legislation that features the $600 rebates and four-month tax holiday, the committee also endorsed a separate bill directing a state agency to temporarily waive the fees for liquor licenses.
Bars around New Mexico had to pay liquor license fees last year, despite being closed for most of the year due to public health orders issued by Lujan Grisham’s administration.
$600 for essential workers
Already, New Mexico lawmakers have passed two separate pandemic relief packages — – in June and November legislative special sessions last year.
But the November package was approved over objections that it did not include hazard-pay bonuses to “essential” workers making less than $15 an hour who have been at the front lines of the pandemic working at grocery stores, hospitals and other businesses.
Senate Majority Leader Peter Wirth, D-Santa Fe, said such workers would benefit from the new relief package, which would target the $600 rebates to New Mexicans who qualified for the state’s Working Families Tax Credit in 2020.
“These are the essential workers that have been holding our economy together and deserve our thanks,” Wirth said during Thursday’s hearing.
He also said the relief legislation was modeled after similar legislation in Colorado.
Money to pay for the relief package – an estimated $185 million for the rebates and restaurant tax breaks alone – would come from the state’s cash-flush reserves. There is currently an estimated $2.5 billion in the state’s cash reserves – or about 35% of state spending.
The bills will take effect immediately upon being signed if they pass both legislative chambers with at least a two-thirds majority vote.
In all, Lujan Grisham has called for up to $475 million to be spent on one-time pandemic relief measures during the 60-day session that started last month, although she has not stipulated to lawmakers which specific programs should be funded.
Tax relief for restaurants
Under the bill approved Thursday, the tax holiday for restaurant and brewery sales would be in effect from March through June.
Specifically, sales made during that time period could be deducted from eateries’ gross receipts tax, and the state would offset any revenue loss incurred by New Mexico cities and counties as a result.
While that could help keep some struggling restaurants afloat, Sen. Crystal Diamond, R-Elephant Butte, said allowing eateries and bars to reopen with relaxed capacity limits would have a bigger impact in keeping such establishments from permanently shuttering.
“It couldn’t happen soon enough,” she said, referring to predictions from some legislators that county-based restrictions might be eased in the coming month.
Meanwhile, House Speaker Brian Egolf, D-Santa Fe, said economic aid for businesses and workers will be a priority as his chamber begins passing its first bills and sending them to the Senate late next week.
“We are well ahead of the pace for a traditional 60-day session,” he told reporters Thursday.
Journal Capitol Bureau reporter Dan McKay contributed to this report.