Going into the 2023 legislative session, we at the Rio Grande Foundation had three goals.
1) Use the state’s massive $3.6 billion surplus to reform the “pyramiding” and business service taxation inherent in New Mexico’s gross receipts tax;
2) Push for SOME kind of serious education reform to improve upon New Mexico’s abysmal 52nd position in the National Assessment of Educational Progress (NAEP).
3) Restore “democracy” by placing some kind of limit on this and future governors’ emergency powers.
Sadly, none of these ideas were taken up and thus the session must be considered a failure.
Additional goals included pushing the Legislature to address the impending electricity shortage which could hit New Mexico as soon as this summer, addressing the medical provider shortage, and helping to push back against bad bills.
The “omnibus” tax reform (HB 547) DID include a gross receipts tax reduction that will be both phased in and contingent on robust revenues. Sadly, it utterly failed to address business services taxation. It also included electric vehicle and energy storage subsidies, film subsidies, higher corporate and capital gains taxes, and taxes go up for drinkers (5 cents per drink), cigar smokers, corporations.
Perhaps Gov. Lujan Grisham will veto all or part of the bill? There is simply no reason for tax hikes with a massive surplus available.
Spending went up dramatically. At the start of the session the Legislature and Gov. largely agreed on a big-spending budget increase of 12% to $9.4 billion. When the dust settled in Santa Fe, the Legislature passed a $9.6 billion budget with an increase of 14% in a single year. NM government is already bloated and has grown quickly in recent years. New Mexico continues to waste money.
4) The best single bill of the session was SB 523 which passed late in the session as Gov. Lujan Grisham seemingly put the screws to Democrats reluctant to reconsider a 2021 law that was favorable to the trial attorney industry. Doctors and patients alike are breathing a sigh of relief, but that doesn’t mean New Mexico won’t face a doctors shortage moving forward.
5) Voting bill HB4 included automatic registration at government offices like the MVD, mandatory drop boxes, felons voting before their time is completely served and a permanent absentee voting list. The bill will have negative impacts on the integrity of our voting process.
Thankfully, a number of bad ideas died in the session.
6) A new paid leave scheme was put forth under SB 11 which would have resulted in tax increases borne by employees and employers alike. It fortunately died after passing the Senate.
7) Most big environmental schemes failed: SB 520 net zero, HB 426 clean fuel standard, and the “green amendment” HJR 4 all died ;
8) Bills to ban plastic bags statewide died;
9) HB 25 and HB 28 which would have increased New Mexico’s minimum wage both failed.
10) Despite devastating NAEP test scores the Legislature didn’t act in a fundamental way to improve the State’s failing K-12 system. And, despite the threat of electricity reliability issues nothing was done to keep the lights on.
How did your legislators vote on these and other issues? Check out the Foundation’s Freedom Index here.