Another unprecedented oil surplus: will Santa Fe blow it again?

On the heels of a massive $3.6 billion surplus which was available to the Legislature and Gov. Lujan Grisham in advance of the 2023 session, analysts are now predicting another banner budget year for New Mexico. The current surplus is estimated at $3.5 billion.

Of course, this number is all the more impressive because New Mexico government has grown rapidly in recent years (meaning more money is needed to fulfill the baseline). In addition to growing general fund spending, the State has also plowed money into various permanent funds and endowments (deferred spending).

There have been minor GRT rate reductions (in 2022) and elimination of GRT on medical deductibles and co-pays, but the Legislature also seriously considered tax hikes in the last session. Nothing fundamental has been done to improve or diversify New Mexico’s economy for the long-term.

Can this Legislature and Gov. enact needed tax reductions and reforms? We remain in a Show-me state of mind, but will keep pushing and fighting. By all accounts the Legislature will again have record revenues when it convenes in January thanks to the production-driven oil boom in New Mexico.

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6 Replies to “Another unprecedented oil surplus: will Santa Fe blow it again?”

  1. Oh boy, the democrats are going to have a big party with that kind of money. But all the working class will suffer more with higher gas , grocery, and mortgage prices. While these immoral degenerates live high on the hog.

  2. Somehow, each time this comes up, we fail to address some of the structural financial issues that our state has incurred. Specifically, we have some huge unfunded obligations like our OPEB, PERA and ERB pension issues.

    I wish we would dedicate some percentage of any surplus as a further payment towards those debts rather than kicking the can down the road. Not much – say 20% of any surplus – maybe allocated to Retiree Health, ERB and PERA based on the number of participants in each plan.

    While we’re at it, we should stop making the problem worse by eliminating the Defined Benefit retirement plans for new employees in favor of a 401(k) type plan. PERA already administers one and it would be trivial to move new hires to that plan. It’s also more portable for employees.

      1. Agree
        Yes, they will blow it again. Same as someone with a new credit card treating it as a pay raise. Idiotic. Someone inherits a little money, buys a snow plow. Doesn’t snow. Same deal.
        They go electric, prices triple (See Australia, England, Germany).
        People lose their homes to utility costs (Some back off – Australia, England).

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