By Daniel J. Chacón, Santa Fe New Mexican
Coverage of the 2023 New Mexico Legislative Session in this publication is made available through a partnership with the Santa Fe New Mexican and The Paper.
A contentious proposal that would entitle employees in New Mexico to up to 12 weeks of paid family and medical leave is headed to the full Senate for what promises to be a hard-fought debate on the floor.
Senate Bill 11 narrowly made it out of the Senate Finance Committee on a 6-5 vote Thursday after a 3½-hour hearing that drew stiff opposition to the measure from Republicans.
“It’s an undue burden on small business,” said Sen. William Burt, R-Alamogordo. “It’s a tax on small business.”
Sen. George Muñoz, D-Gallup, who chairs the committee, joined all four Republicans in voting against the bill, citing a report that found initial assumptions may have been too low and the program could be in the red in a matter of a few years.
Sen. Mimi Stewart, D-Albuquerque, who is sponsoring SB 11 with other Democrats, said the fiscal impact report was based off an inaccurate study.
“The FIR is wrong,” she said before the meeting adjourned.
The proposal to create a paid family and medical leave program comes less than a year after lawmakers passed a bill requiring private employers to provide paid sick leave to their workers.
The committee’s vote came after a presentation on the bill, which would create a family and medical leave fund administered by the New Mexico Department of Workforce Solutions, and public testimony from people and organizations on both sides of the issue.
“We cannot have healthy communities in New Mexico without supporting people to keep employment while on short leave to care for newborns, themselves or family members, or to seek safety when experiencing intimate partner violence,” said Leah Sanchez, co-executive director of the New Mexico Public Health Association. “It’s an essential policy.”
Holly Beaumont, organizing director of Interfaith Worker Justice New Mexico, called the bill an investment in the state’s future.
“So many of our working families have taken on the enormous responsibility and cost of raising the next generation of New Mexicans while also taking care of aging parents,” she said. “We owe them our full support.”
Both employees and employers would be required to contribute to the newly created Paid Family and Medical Leave Fund. The cost for employers would be $4 for every $1,000 of wages. For employees, it would be $5 for every $1,000 of wages. The details of how the fee would be assessed, Stewart said, would be worked out as part of the rule-making process.
The bill exempts employers with fewer than five workers, which represents about two-thirds of businesses in New Mexico. Employees at those businesses, however, would still have to contribute, making them eligible for the benefit.
“They’re only 9% of the workforce even though they’re 66% of the businesses, which is why the fund still works when we exempt those small businesses from contributing,” Stewart said.
Employers could opt out of the program if they offered a benefit that matched or exceeded the state’s.
Employer and employee contributions would begin in January 2025, but the benefit itself wouldn’t be available until the following year. Stewart said the start date was delayed to give the state enough time to plan and prepare for a successful launch.
“That gives almost two years — a year and eight months — for Workforce Solutions to develop the IT program and to hire people to administer the program, to educate employees and employers, and to do rule-making and make sure the program will work,” she said.
Sen. Michael Padilla, D-Albuquerque, a co-sponsor of the measure, described the effort as a work in progress.
“I feel like there’s a cake being made here that over time is going to reap tremendous benefits for the people in New Mexico and for business as well,” he said.
Matt Coday, president and founder of the Oil and Gas Workers Association, who opposes SB 11, compared it to a pie — but not an edible one.
“The gentleman earlier who said that we’re making a cake today, I would go along those lines and say that this is definitely a pie,” he said. “It’s a cow pie to the face of every New Mexican worker who’s tired of having their taxes raised.”
Other opponents described the bill as another burden on businesses still trying to recover from the coronavirus pandemic. Terri Cole, president and CEO of the Greater Albuquerque Chamber of Commerce, said the bill imposes a new tax on employers and employees alike. She, too, referenced the fiscal impact report from the Legislative Finance Committee, which stated the Department of Workforce Solutions may have to adjust premiums in 2027 to ensure the fund remains solvent.
“You’ve read the LFC analysis,” she said during Thursday’s hearing at the Roundhouse. “It’s likely insolvent, and there are more unanswered, serious questions raised by this bill than this building has germs.”