Minority Leader Bill Sharer R-Farmington
By DANIEL J. CHACÓN
The Santa Fe New Mexican
A $10.8 billion spending plan Democrats hailed as a “budget of opportunity” and Republicans compared to a “bloated cow” passed the Senate largely along party lines Thursday.
House Bill 2, which was revised by the Senate Finance Committee, now heads back to the House for concurrence.
The 294-page budget bill for fiscal year 2026, which begins July 1, sparked a two-hour discussion and debate that ultimately ended with a 24-16 vote. Two Democrats, Sens. Harold Pope of Albuquerque and Shannon Pinto of Tohatchi, joined their Republican colleagues in voting against the spending plan.
“I believe there’s great things in this bill, but we’ve also heard a discussion on the floor; there’s some problematic things in this bill,” Pope said. “Really, the discussion turned to a lot of ‘I’ instead of ‘we’ and ‘the people,’ and I just believe we can do better. And I believe we could have done better.”
During one point in the debate, Sen. Jeff Steinborn, D-Las Cruces, expressed disappointment a $50 million appropriation to clean up abandoned uranium mines and other contaminated sites had been cut to $20 million, prompting Sen. George Muñoz, a Gallup Democrat who chairs the powerful Senate Finance Committee, to defend the decision.
Muñoz noted the New Mexico Environment Department had received a $2 million appropriation in 2023 for similar cleanup efforts.
“They barely spent $1 million of it, and they want to hoard and pile money when I got to make tough decisions,” he said.
“How do I fix CYFD?” Muñoz asked, referring to the troubled state Children, Youth and Families Department. “How do I not let another child die? Tough decisions have to be made in the budget.”
‘Robust reserve’
The spending plan drew mostly praise from Democrats, who touted investments in early childhood education, child welfare services, behavioral health, public safety, affordable housing and the state’s workforce, which is poised to receive average 4% pay increases in the upcoming fiscal year.
“I’ve said this before: We’re not a poor state,” Muñoz said. “Know what we are today, Mr. President? We’re a land of opportunity. New Mexico, in this budget, has the greatest opportunity to diversify its economy than it’s ever had. Sure, it’s $10 billion, but we’ve taken care of a lot of needs in New Mexico. We’ve given opportunity across the board.”
The proposed budget, which reflects a nearly 6% increase in spending over the current year, maintains a “robust reserve” of more than $3.2 billion that would “withstand any potential economic downturns,” he said.
“Our future is secure until we know what the feds will do with us,” Muñoz said, referring to potential federal funding cuts under the Trump administration.
Key investments in the budget bill as highlighted by Muñoz include what he called a $100 million “down payment” for a new behavioral health trust fund — initially envisioned as a $1 billion fund — as well as $50 million for a natural disaster revolving loan fund and an additional $25 million to promote the expansion of health care in rural communities, and $65 million for transportation projects.
Sen. Michael Padilla, D-Albuquerque, said the proposed budget includes a “historic increase” in funding of about $170 million for the Early Childhood Education and Care Department.
“I don’t think we’ve ever seen anything like that with regard to this department in the six to eight years that we’ve been working to stand this department up,” he said. “The funding expands things like home visiting programs, pre-K, child care assistance and tribal language supports to reach more families across the state.”
Padilla also noted the budget bill would increase distributions from the Early Childhood Trust Fund to $500 million a year.
“This will ensure that we set the kiddos up on the right path before they go to school,” he said. “When we weren’t doing this, Mr. President, it was like we were making a movie, and we didn’t even have the rights to the movie. Now, instead, we prepare these kiddos for the full journey of learning that they have for the rest of their lives.”
No tax rebate
Republicans criticized the spending plan as inflated and pointed out the state’s budget has grown about 74% in the last seven years, largely as a result of a booming oil and gas industry they say the Democrat-controlled Legislature has tried to penalize.
Minority Leader Bill Sharer of Farmington questioned whether the state has gotten a return on its investment after year-over-year budget increases.
“Is our education system 74% better? Do 74% more of our kids read at grade level? Has crime reduced by 74%? Are our streets 74% safer than they were? Are our higher ed outcomes 74% better than they were? In fact, is anything in state government 74% better than it was?” he asked. “I submit to you that no, and in fact, in some cases, we’re worse than we were.”
Sen. Larry Scott, R-Hobbs, called for belt-tightening.
“I would like to be doing more with less rather than I think the current undertaking that we have in place, which is doing less with more,” he said.
Sen. Jay Block, R-Rio Rancho, acknowledged the budget-making process is a “colossal effort” but contrasted the state’s record surpluses with its high poverty rate and low median income.
“Our state government keeps getting richer and richer while our citizens get poorer and poorer,” he said while advocating for a tax rebate.
In the other chamber, House Republicans had pushed for a $600 “dividend stipend” for every New Mexico resident, courtesy of the state’s bonanza in oil income. Democrats shot the proposal down.
“This is a state government that has an appetite for your wallets and your purses, and what are we getting back for it?” Block asked. “Well, our schools aren’t getting better. Our roads aren’t getting better. The crime [is] not getting better. Our incomes aren’t getting better. Our business climate isn’t getting better. but state government is getting much richer. They’re living large, and the people are not.”
Sen. Candy Spence Ezzell, R-Roswell, said the state is overspending and cautioned it would run out of money “if we can’t get our budget in check and quit spending like we’re a bunch of thieves on our way down to South America somewhere.”
Ezzell likened the spending plan to a bloated cow.
“This is going to get pretty graphic,” she said. “But if I see a cow that has bloated, I know what to do. I have to take a sharp instrument and go right into here, into her belly, to let some of that hot air escape. Maybe that’s what we need to do with our budget because our budget is bloated. We are doing nothing more than growing government.”
In his closing remarks, Muñoz highlighted rebates the state provided New Mexicans in years past, reduced gross receipts taxes, taxpayer-funded college tuition, expanded prekindergarten and infrastructure projects totaling billions of dollars.
“When we say we’re just taxing and spending on this side aisle, it ain’t true,” he said. “We give back to our people.”