New Mexico’s financial strategy to safeguard and grow its wealth from local oil production is yielding significant returns, with state investment income now surpassing personal income tax revenue for the first time, according to a recent fiscal forecast. However, this progress is unfolding against a backdrop of mounting efforts by far-left Democrats to dismantle the state’s oil and gas sector through initiatives like the so-called “Energy Transition Act,” New Mexico’s version of a Green New Deal, which was passed in 2019.
For the fiscal year spanning July 2024 to June 2025, the state’s revenue from its two multibillion-dollar permanent funds and interest on treasury accounts is projected to reach $2.1 billion. This figure edges out the $2 billion anticipated from personal income taxes. The rise in investment earnings is intended to sustain crucial public programs — such as childcare subsidies and socialized “free” college — even as New Mexico faces potential declines in oil revenue due to the push for a shift to so-called “green” energy.
Meanwhile, legislators have revised the state’s income tax brackets, lowering residents’ taxes in the nation’s second-largest oil-producing state, behind Texas.
These figures serve as a foundation for budget negotiations when the Democratic-controlled Legislature convenes in January.
The state’s financial growth remains deeply linked to oil production, which continues to drive revenue increases at a more moderate pace. However, this growth exists in tension with legislative priorities, including far-left energy policies to curb fossil fuel reliance. Efforts like the Energy Transition Act have been criticized as a direct attack on New Mexico’s oil and gas industry, threatening a vital sector supporting the state’s economy.
Economists predict New Mexico will see a record-setting $13.6 billion in general fund revenue for the fiscal year running from July 2025 to June 2026, reflecting a 2.6% increase from the prior period. This surge leaves room for an additional $892 million in state spending, representing a 7% increase. In total, the state’s general fund income is expected to exceed its core annual spending obligations by a staggering $3.4 billion.
Recognizing the windfall, lawmakers are exploring new savings initiatives to safeguard against future economic uncertainty. One proposal would create a $1 billion trust to support mental health and addiction treatment services, responding to growing public concern about crime and homelessness. Lawmakers may also revisit a proposal to establish a trust for Native American education — all cutting into oil and gas funding.
While the economic gains are undeniable, “progressive” energy policies like the Energy Transition Act risk eroding New Mexico’s economic foundation. The act, which aims to transition the state away from fossil fuels, could ultimately jeopardize funding for the very social programs lawmakers are striving to protect. The state’s oil and gas sector not only fuels public revenue but also supports tens of thousands of jobs, a fact that some believe the far-left faction of the Democrat Party has overlooked in its pursuit of environmental goals. Futile efforts to “go green” risk undercutting the very prosperity that is now enabling increased social spending, tax cuts, and trust fund expansions.
Drill, baby, drill!
Simple solution:
Let Lea and Eddy Counties leave NM and become part of Texas. That way NM would not have to be involved in that evil and dirty oil money!
I love your idea!
I do not know is Otero has wells or not but Otero will come with as long as it is not El Paso county.
The democraps plan is to destroy oil and gas and fund the State by the dividends accrued by the Permanent Funds. Why is New Mexico at the bottom of everything good when the State has 53 billion dollars (that’s 53,000 million dollars) in its savings account?
https://www.nmdfa.state.nm.us/2024/09/17/permanent-fund-investments-to-surpass-oil-and-gas-revenue-securing-new-mexicos-future-by-2038/
Don’t be fooled by that number — it is an enormous amount for an individual, but consider that our state’s budget is over $10 billion. $2 billion of that comes from investment income off that $53 billion. Which means, that $53B is not growing as fast anymore, AND we rely on that investment growth!!!
Would you have the money get spent? Too bad, the NM Constitution prevents easy access. It is intended to be saved, not squandered.
Changing away from leftist “magic money” policies and changing how/what the money is currently spent on will help this state, not digging into our hard earned savings that we rely on for 20% of our budget!!!!
Having oil revenue is no guarantee of long term success , just witness Venezuela who had at one time the eighth most prosperous economy in the world. Communists took it over and utterly destroyed it much like the communists have done to NM. A one party state is doomed to fail. All these wasteful programs installed by the MLG regime have amounted to nothing for the majority of citizens. Attacking the oil industry for fake scams like the “green new deal” will continue to keep NM last in any meaningful category. New Mexicans must unite to cast off the yoke of these vile self serving marxists.
Well said and to the point!!!
Well Said.
Agree. We will become the new Venezuela if we follow the path of the new green deal.
Lower my taxes, IF the funds are not spent wisely. NM allocates too much on left leaning progressive pet projects. It is time for the state through its agencies or for the counties to allocate and spend $$ on infrastructure. Many of our roads are “third-world”. Fix them. Improve highway safety. More traffic lights where needed. Stripe! More dollars for emergency services equipment and personnel.
Don’t fund “green” energy projects of which their construction is sucking millions of gallons of our limited supply of water from our aquifers. The “greenies” are ignorant of this serious environmental impact, or choose to look the other way to promote their agenda.
NM is third worst in the nation in spending money where it needs to be spent. We are last or almost last in every measurable aspect of good government. If we go totally green and there is no oil money do our taxes go sky high? You bet. We are idiots if we think we can vote democrat and the marxist in Santa Fe will do anything to benefit the people of NM. Many folks voted for Trump but they did not voter for other republicans, see that is our crappy schools at work. It is time to pull our heads out of our butts and vote republican.
They build more houses, but same two lane roads no extra lanes. Would like to see another freeway or more access across river in ABQ.
Boy, talk about biting the hand that feeds you.
“Green Deal” initiatives are effectively communofascist cruise missles directed at American energy capability.
These dangerous people want to cut our country’s ability to generate energy without considering any replacement plan based in reality!! This is part of the “soft invasion” – destroying America without landing a single troop.
The word soup these tyrants serve up to promote their agendas is slurped up by the brainwashed consumers of a mass media that thrives off of hysteria, hate, and fear… it’s sad and disgusting.
Look at the likely effect of every action and policy these treasonous fools push – they attack the US at every step.
Southeastern New Mexico should become part of oil-rich Texas.