The Roundhouse in Santa Fe. Post file photo
By Esteban Candelaria
The Santa Fe New Mexican
While House Democrats touted the $10.8 billion spending plan they sent to the Senate on Monday, one state agency sent a dire message: The proposal “will jeopardize essential child welfare services and put the state at risk of costly federal penalties.”
The budget proposal, which heads to the Senate Finance Committee for scrutiny after a House vote of approval, leaves the New Mexico Children, Youth and Families Department with relatively flat spending — about 11% less than it had requested.
The agency will lose out on critical new positions, increased monthly stipends for foster families and other priorities prescribed by a key settlement agreement in a civil court case, officials said.
“I don’t think there’s trust,” CYFD Cabinet Secretary Teresa Casados said, speaking of a gap tens of millions of dollars wide between what her troubled agency had proposed for its budget in the next fiscal year and what House Bill 2 would appropriate.
“I don’t think that people trust what is being said by the department because it’s been broken for so long that they feel like it just needs something completely different to fix it,” she added.
House Democratic leaders said the agency’s failure to spend money in recent years was behind their decision to rein in new spending.
During debate over the budget bill on the House floor Monday, Rep. Nathan Small, D-Las Cruces, chair of the influential House Appropriations and Finance Committee, said the panel was “uncomfortable” with the strategy of simply injecting more and more money into CYFD’s base budget.
“The needed changes simply weren’t happening that way,” he said.
Rep. Meredith Dixon, D-Albuquerque, vice chair of the House finance committee, doubled down on Small’s comments.
“We remain deeply concerned about state funding at this agency that has gone unspent, reporting requirements that have gone unmet, and available federal funds they have failed to secure,” she said. “… This year, we are once again directing significant funding to the agency, while also making clear that we expect to see real results and improvement when it comes to child well-being.”
Casados’ agency had asked for $437 million in recurring funding for fiscal year 2026 to address long-standing, systemic issues. But under HB 2, the total CYFD budget would remain at around $389.4 million.
When including requests for one-time pots of money, the discrepancy between CYFD’s request and HB 2 is over $94 million, spokesperson Andrew Skobinsky wrote in an email.
According to Legislative Finance Committee analyses, CYFD has struggled to draw down federal funding and has seen significant reversions of money it was not able to fully spend in recent years.
Committee staff have said the agency saw a flat budget in the current fiscal year — instead, the Legislature provided appropriations in a three-year pilot program to address systemic issues through the state’s new Government Results and Opportunity Expendable Trust Fund, established last year.
Under the current budget proposal, that strategy would continue.
“We’ve got to provide new funding that we can track the efficacy of, and work to make sure it’s implemented as well as possible,” Small said. “And the three-year pilot is the best way to do that.”
The child welfare agency argues the plan means “severe underfunding” for critical services, as well as to bridge gaps identified in the settlement of a court case known as Kevin S. brought in 2018 by 14 foster children, alleging the state was failing to care for young people in its custody.
On the first day of the legislative session, Albuquerque attorney Charles Peifer, who mediated weeks of arbitration proceedings in the Kevin S. case late last year, found CYFD and the state Health Care Authority failed to make good on promises to improve worker caseloads and recruit new foster homes.
Following Peifer’s findings, CYFD upped its original budget request of $412.7 million to $437 million in January.
The agency asked for almost $5 million for 50 new case aides to help frontline child welfare workers — money not included in HB 2, the agency said in a news release.
Casados also noted the agency’s request for funding to hire over 100 new frontline caseworkers may be at risk.
HB 2 would set aside a total of $10 million per year for three fiscal years to fund more workers, with a goal of meeting caseload requirements under the Kevin S. settlement.
Skobinsky said, however, the plan “will put the agency in a position to be hiring on a temporary basis until the Legislature deems it appropriate to fund the caseworkers permanently.”
“It’s not a stable funding source for hiring permanent front-line workers,” he said.
The child welfare agency said in its news release HB 2 does not include $9.8 million to bump up monthly stipends for families with foster children to $900 per child. That move would help attract new families to the system, a central issue in the Kevin S. settlement.
HB 2 would include $100,000 to contract with an outside organization to study potential foster family rate hikes.
Among other requests missing from HB 2 that would address issues laid out in Kevin S., according to CYFD: money for 13 new training positions for child welfare workers, five dedicated recruiters of foster families in high-needs counties and data system upgrades.