The prospect of additional state funds brought welcome news for New Mexico’s college students Wednesday.
Based on an improved revenue outlook, New Mexico will have an additional $373 million to spend, bringing the state budget to $7.436 billion, financial experts said during a Senate Finance Committee hearing.
The extra money would include a one-time appropriation of over $20 million to make college more affordable for New Mexicans.
Some $11 million of the new money would go into the state’s Opportunity Scholarship Program, which gives residents the chance to attend college tuition-free.
An additional $10.5 million would shore up the New Mexico Legislative Lottery Scholarship Program so that it would cover 90 percent of tuition for eligible students headed to college. “Increasing lottery [scholarship] tuition really reduces the requirement for the opportunity scholarship [program] and expands its reach,” Legislative Finance Committee Director David Abbey told committee members.
“That’s a pretty significant supplement to financial aid, over $20 million.”
A combination of recurring and one-time expenditures would also benefit the public school system, giving it over $3 million in extra funding. Another $1 million is aimed at supporting athletic programs at the University of New Mexico and New Mexico State University to help offset lost revenue because of the pandemic.
Another $34 million in state funding would be available to increase the employer contribution rate to the New Mexico Educational Retirement Board by 1 percent a year for the next four years. But that investment would depend on the passage of legislation sponsored by Sen. Mimi Stewart, D-Albuquerque, that is working its way through the House.
Other proposed funding would include an additional $2 million for tourism marketing, increasing that budget to $7 million.
Several committee members said they wanted to see the state invest more in tourism efforts, given the toll the pandemic has taken on that industry.
The state also is set to receive at least $1.6 billion in federal coronavirus relief aid, part of a $1.9 trillion deal approved Wednesday by Congress.
That money would be used to create a general fund surplus account that could be used to replace lost revenue because of the pandemic.
Legislative Finance Committee leaders recommended using $600 million of the federal money to fill gaps and bolster the state’s unemployment insurance fund. Another $50 million would be targeted for Medicaid funding.
But some lawmakers cautioned against counting on that money too soon, given President Joe Biden has not yet signed the bill into law and rules for distributing and earmarking the money have not yet been created.
The Legislature would likely have to convene a special session to deal with appropriating those funds, as it did last year with pandemic-relief efforts.
Sen. Jacob Candelaria, D-Albuquerque, said it’s “appropriate for the Legislature to appropriate” that money unless it is specifically designated for certain programs.
He said he would like to see at least $25 million of the federal money invested in the tourism industry.
“We have [to] turn on our hospitality/tourism industry as quickly as possible,” he said, adding that there is no better state to visit than New Mexico. “Who really wants to go to Texas?” he asked. “Really. That was a joke. Really. Come to New Mexico. Let’s just remind everyone of that.”
After an hour of discussion on the issue, members of the Senate Finance Committee unanimously voted to work the additional funds into the budget. But it’s far from a done deal, as George Muñoz, committee chairman, told the assembly. “This is not final approval yet,” he said. “We’re reviewing this.”
The committee is expected to continue discussion on the budget Friday.