State lawmakers unveiled a record-high $10.8 billion spending plan for fiscal year 2026, a budget that includes higher starting salaries for teachers, an average 4% pay increase for state employees, and over $3 billion in one-time expenditures. This marks a 5.7% increase over the current year’s budget. However, a closer examination reveals concerns about the long-term implications of this level of government spending, as highlighted by the Rio Grande Foundation’s analysis.
“New Mexico is in the best financial situation it’s ever been in its history,” said Sen. George Muñoz (D-Gallup), chair of the Legislative Finance Committee (LFC), during a press briefing. Muñoz emphasized that the budget aims to invest in priorities such as education, healthcare, and job opportunities for future generations. Yet, critics argue that such spending perpetuates an unsustainable trajectory.
The budget’s $10.8 billion in recurring spending is slightly below Democrat Governor Michelle Lujan Grisham’s $10.9 billion proposal. Additionally, while the LFC’s recommendation calls for a 4% raise for state employees, the governor’s plan includes a smaller 3% increase. Differences also exist in reserve levels, with the LFC maintaining reserves at 33% compared to the governor’s 34.2%.
The Rio Grande Foundation raised concerns about the broader implications of the spending spree. With $900 million in new revenue and $13.4 billion in general fund revenue available, the Foundation criticized the lack of focus on returning surplus funds to taxpayers. “Whether the money is spent now or allocated to one of our State’s permanent funds, it is going to be spent by government,” the Foundation noted. The question, they argue, is whether average New Mexicans and businesses will benefit from this surplus.
Despite the enthusiastic rhetoric from lawmakers, the Foundation’s analysis highlights that this budget reflects a growing government at the expense of direct relief to taxpayers. “The Democrats have grown government and mostly NOT shared the wealth with average New Mexicans,” the Foundation’s critique states, pointing to recent electoral success as a driver for this trend. They caution that taxpayers may once again be “left out in the cold,” especially with no tax cuts included in the bill.
Democrat House Speaker Javier Martínez lauded the budget’s focus on affordability, safety, and healthcare access, calling it “a guide and driving force of the entire session.” Similarly, Senate Majority Leader Peter Wirth described the spending plan as an “extraordinary opportunity” for investment. However, the Rio Grande Foundation’s perspective suggests a need for restraint and an emphasis on fiscal responsibility.
The proposed $3 billion in one-time spending includes $1.7 billion for endowments and funds, as well as new initiatives such as a “behavioral health trust fund.” While these initiatives aim to address immediate and long-term needs, critics argue they sideline opportunities for direct tax relief. “Taxpayers should have a say in how surplus funds are utilized,” the Rio Grande Foundation posits, urging lawmakers to prioritize returning money to the people who generate it.
As New Mexico’s financial position remains strong, questions about how to balance investment in public services with taxpayer relief will shape the upcoming legislative session. With a budget described by some as a “responsible investment” and by others as a “missed opportunity,” the debate over spending priorities continues.
You cannot just throw money at a problem without a real plan to fix it.
yep
4% for government workers? I also noticed an “average increase” which generally means the blue collar folks get a 2.5 % increase and the white collar workers get a 7.5%. Meanwhile Social Security was generous with a 2.5% increase at the same time counties increased property tax by 3%. I still do not understand why NM government is spending oil money like kids with their Daddy’s credit card, but they are continuing to try to cut NM oil production. All I can say is New Mexicans wake the Hell up and vote this marxist democrat regime out of office to make it better for us all.
yep
Spending on education over the past 2 decades in NM has a produced exactly what under the former terms of the elected in NM?
Anyone?
Are we in the top 10 in educating? Top 20? maybe the top 40?
Has hiring outside NM and bringing in former out-ted spouses of CIA spies contributed anything to NM higher education other than spending 1.9 million in a defunct bonus by WNMU?
Does anyone really see any so called “Bang for the Bucks” in more education spending? Anyone????
Does anyone see where NM federally fixed income earners getting 2.5% COLA, and everyone one else getting 4.0% in NM contribute to decreasing poverty of those fixed income earners?
Anyone? Please…CAN ANOYONE POINT OUT SPECIFIC POSITIVES FROM WHAT I MENTIONED ABOVE????
The Communist DNC government being spewed out from the queen of the tolite seat in Santé Fe has only a goal in mind… make 51% happy and the rest can go to h*ll.
Oil and gas have been gutted for expansion. #1 income for the State. Gambling has been introduced since 1997 and has been gutted and diminished as an income generator ever since. like #7 or #10 on the States tax generating revenue schemes.
Ranching and farming, mining and leasing has been stubbed by Governors decrees and personal mandates. #17 on the State revenue streams for ranching.
Fixing NM’s current Communism requires an honest election electing people who understand business generation, (not business operation), free markets with a dab of common sense. We have none of that in the capitol in Santé Fe right now.
Diversion of resources from spotted owls, and sand lizards to forest management use and regrowth… Divert resources and monies from DEI and trans identification of children under 18 in public schools and which bathroom to use, focusing on growing income earning business industry is far more critical to economic survival for the poor, unemployed, homeless, sick or disabled than having a primary educational system attempt to identify your Childs sexual orientation at age 7.
Just sayin…
Oh… i’ll add this too John Block… Prove me wrong. Ill wait for the far left liberals heads to explode over my past two comments…
Did you know the public employees retirement fund (PERA) has not had a raise for five years? They took the cost of living raises away contingent on a high stock market, well it’s way higher than it’s ever been all while teachers and state employees constantly getting raises.
Yep.
A long time ago, PJ O’ Rouke said something like, “Giving a politician money is as dangerous as giving a teen-age boy a bottle of whiskey and the keys to a car.”