By Lily Alexander
The Santa Fe New Mexican

The House Education Committee has approved a slimmed-down version of a measure that would overhaul distance-learning regulations in New Mexico, removing provisions many in the virtual school community argued would eliminate such options in small districts.

An earlier version of House Bill 253 would have restricted the number of a district’s students who could enroll in virtual programs and would have prohibited districts from enrolling distance-learning students from outside their boundaries. 

The committee voted 8-4 along party lines Monday on a committee substitute for the bill.

The measure that advanced still has some financial impacts for rural districts that operate virtual academies. Students in those programs won’t count toward “rural program units” in the state’s per-student funding formula known as the State Equalization Guarantee for fiscal years 2026 and 2027. The rural program component of the funding system is designed to boost rural districts with small numbers of students.

Legislative Education Study Committee Director John Sena had told the committee Friday virtual schools can currently generate additional revenue from the state just by being headquartered in rural districts.

Under the current version of HB 253, private cyber school corporation Stride K12, which operates online academies in the Chama and Santa Rosa districts, will still be prevented from receiving $38 million from the state in the current fiscal year through its contracts with the districts. 

Those funding changes are aimed at addressing a $35 million gap created when the company’s online program at Gallup-McKinley County Schools moved to the Chama and Santa Rosa schools, taking the 3,000 students with it.

Nonetheless, a representative of Stride K-12 lauded the bill changes. 

Katrina Mohamed, the company’s vice president of school services, said in a Monday interview she thinks an outpouring of support for virtual education during a House Education Committee hearing Friday played a role in the changes.

“I was pleasantly surprised, somewhat shocked that so much of the negative language was taken out,” she said. ” … As written now, it really does preserve virtual schools as they are today, which is extremely important.”

“I think it’s important to note that Stride K12 is a publicly traded company and does have money to cover while things are being worked out,” said Rep. Joy Garratt, D-Albuquerque, a co-sponsor of the measure.

Rep. Jack Chatfield, R-Mosquero, estimated about 400 people showed up to share their thoughts on HB 253 Friday. 

A much smaller crowd attended Monday’s committee meeting, which did not include public comment.

If the bill passes, the Public Education Department can withhold up to 100% of funds for students at distance learning programs it finds are out of compliance with regulations. The Legislative Education Study Committee, the Legislative Finance Committee and the Public Education Department would be required to conduct a comprehensive study on virtual education in New Mexico by Nov. 1.

Several people noted Monday a shortage of data available on distance learning programs and who they serve.

Mohamed said regardless of the funding move, “we’ve committed to educate the students throughout the school year.” She added Stride K12 employs 100% of its staff, including teachers, guidance counselors and special education professionals.

Rep. Patricia Roybal Caballero, D-Albuquerque, said, “It’s unacceptable to me that throughout the years we’ve failed to actually do several things: put up the necessary guardrails to prevent this type of — for lack of a better word, but I think it’s appropriate — exploitation of our education system,” she said.

New Mexico is an especially vulnerable state, Roybal Caballero said, because of its high poverty rates and its “history of trying to remediate and correct a failing education system.”

“It just places us in a very vulnerable position for Stride and others to come in and exploit that situation,” she said.

Mohamed said she thinks it is misleading for lawmakers to make comments about Stride K12 being a for-profit company. Companies that school districts buy IT supplies and textbooks from are also for-profit, she said, “and nobody ever talks about that.”

“Virtual education is a different form of public education,” she said. “That doesn’t mean it’s a lesser form.”