At the Rio Grande Foundation we recognize that weather and climate are two different things. But, the left both asserts that climate change is a catastrophe AND they regularly assert that everything from Canadian fires  to winter storms is driven by “climate change” (formerly “global warming).”

Now, KRQE Channel 13 is reporting that New Mexico may have its hottest summer ever thanks to the El Niño weather phenomenon.

But, did you know that Albuquerque has NOT had a day of 90 degrees or more so far in 2023? Did you know that we typically have our first 90 degree day by May 27? There are many ways to present data, but the following chart uses data from this website to illustrate the number of 90 degree days FROM RIGHT to LEFT. You can also see the trend line which if anything goes down as time goes on. 90 degree days are on the way this summer, but it is hard to see how this particular trend represents a global warming crisis.

This website which tracks the number of 100+ degree days from the National Weather Service also doesn’t exactly show that Albuquerque specifically is warming dramatically.

New Mexico is awash in revenue from the State’s oil and gas industry and as we reported last week, that flood of revenue shows no signs of stopping. New Mexicans will soon be receiving $500 or $1,000 checks from the State thanks to legislation passed in the recent legislative session and those are welcome relief for families that have seen negative wage growth in the Biden economy.

However, there are two major issues with these rebates:

1. They do nothing to address New Mexico’s long-term economic struggles because they don’t change the State’s fundamentally anti-business tax and regulatory climates;
2. They are a pittance compared to what the State is receiving and spending just this year. As a reminder, New Mexico’s budget surplus was $3.6 billion just this year.  The total (one-time) “cost” of these rebates is a estimated to be $667 million. Compare that with the $1.2 billion in new spending and the fact that

On this Tipping Point conversation Paul interviews Gerges Scott. Gerges is a Senior VP at Agenda, an Albuquerque-based public relations firm. Gerges was recently “across the pond” for conferences in Scotland and England. Gerges and Paul also discuss the Holtec facility which was recently approved in Southeast New Mexico and its importance both for the New Mexico economy AND for its potential role in reigniting America’s nuclear industry and efforts to bring zero-carbon energy to market.

Finally, Paul and Gerges talk about the “fake news” from a left-wing advocacy group which claims that he has a state contract to single-handedly transition New Mexico’s economy away from oil and gas.

As RGF has discussed, unlike the past, New Mexico’s current oil and gas boom is being driven by strong production. That means that even if prices per barrel drop, New Mexico will still see historically-strong revenues. It is also contrary to the left-wing narrative that New Mexico is going to see oil/gas revenues dry up or the nation/world abandon fossil fuels anytime soon.

Now, the latest report is that New Mexico’s oil and gas revenues exceed expected levels by $581 million above December estimates. That is above estimates made as recently as December for the current 2023 fiscal year which ends June 30.

As the New Mexican article notes, Democrats in the Legislature are upset the Gov. vetoed several “green” subsidies. RGF is frustrated the Legislature didn’t include needed GRT reform in the tax reform package and that the Gov. vetoed even rate reductions.

Regardless, the report points to the fact that the revenue boom continues and that MLG and the Legislature have another opportunity to enact needed tax reform.

On this week’s conversation Paul and Wally briefly discuss Albuquerque’s City Council consideration of putting significant governance changes on the ballot.

Meanwhile, the City recently asked volunteers to help clean up bus stops. 

New Mexico’s new “529” law takes effect on June 16. The new law gives additional K-12 savings choices to New Mexicans.

The Legislative Finance Committee is undergoing a leadership change. RGF and recent LFC report both highlight New Mexico’s workforce participation rate challenges. Furthermore, according to the LFC report: Oil and gas generates more than half of general fund revenues.

Secretary of Interior Haaland ignores Navajo objections and imposed a 10 mile buffer around Chaco Monument. 

Another round of national coverage on Mississippi’s education miracle. 

New Mexico uses revenue windfall to boost current, future spending while other states including Nebraska are reducing taxes (more interesting data from LFC).

According to news reports New Mexico Land Commissioner Stephanie Garcia Richard has imposed a one-mile boundary on NEW oil and gas leases around schools. The limit ONLY applies to lands managed by the State Land Office and it also only applies to future leases and does not apply to tribal, federal, or private lands.

No scientific studies are cited by Garcia Richard or the Land Office. If there WERE studies illustrating such health dangers, you can bet that the Gov. and Legislature would have acted long ago to address current drilling, not just future drilling on SOME lands.

In the grand scheme of things this is likely simply virtue signaling as there undoubtedly few state lands within a mile of a school that have NOT already been leased. But that’s the point. While RGF does not often discuss land commission issues, the fact that New Mexico’s State Land Office generates 90% percent of its revenues from oil and gas, yet the logo is below says it all.

Recently Rio Grande Foundation president visited Silver City and Alamogordo to talk to the Grant County GOP and Alamogordo Rotary. Paul’s talk hit on New Mexico’s economy and its growing reliance on oil and gas (despite protestations to the contrary from New Mexico’s “green” policymakers). Paul also discussed education policy and what COULD be done and IS being done in states from Mississippi to Arizona to improve education.

In Alamogordo he was thrilled to see former state legislator (former and future?) Congresswoman Yvette Herrell.

If your New Mexico-based civic group would like a presentation on New Mexico’s economy and education system please reach out to us at: info@riograndefoundation.org

Thanks also to Bob Flotte and Mike Durler for having Paul in Alamogordo and for the weekly discussions of New Mexico’s economy and politics on Tuesday mornings from 8:25 am to 9.

For several years now Gov. Lujan Grisham has pushed and Democrats in New Mexico’s Legislature have rejected various bills which would impose a “clean fuel standard” on motorists. The effort claims to be about reducing the “carbon intensity” of fuels put in gas tanks, we at the Rio Grande Foundation have noted that the effort would entail a great deal of ethanol being added to our gas.

Sadly, while New Mexico is not a serious corn growing state, our congressional delegation all of whom claim to be environmentalists, remain unwilling to challenge this colossal waste of tax dollars.

Michael Grunwald, a columnist writing in the New York Times has written a column highlighting why adding ethanol to gas is a foolish policy FROM THE ENVIRONMENTALIST perspective. Here are a few choice points:

• It’s fairly well-known that farm-grown fuels like corn ethanol and soy biodiesel accelerate food inflation and global hunger, but they’re also a disaster for the climate and the environment.
• Worldwide, a land mass larger than California was used to grow under 4 percent of transportation fuel in 2020.
• Biofuels “increase greenhouse gas emissions through the conversion of carbon-rich forests, wetlands and grasslands into farmland, expanding our agricultural footprint while shrinking nature’s.”

Nebraska recently became the latest state to enact serious tax cuts (without the benefit of a booming oil and gas industry) The plan reduces the top individual and business income tax rates to 3.99% by tax year 2027 and entirely eliminates state taxes on Social Security benefits a year early in 2024.

Several other states have enacted personal income tax reductions that took effect in 2023: Arizona, Idaho, Indiana, Iowa, Kentucky, Mississippi, Missouri, Nebraska, New York and North Carolina.

Meanwhile, New Mexico which has become even more dependent on oil and gas in recent years has NOT cut personal income taxes. Instead, the State remains dedicated to growing spending and holding money in reserve for future spending. The following charts are from the Legislative Finance Committee’s recent report.

The Rio Grande Foundation has been New Mexico’s leader in shining light on the “Mississippi miracle” in education. But other media outlets and columnists left, right, and center have also been doing their part. The latest is NY Times columnist Nicholas Kristof.

Here are a few choice quotes from his column: “Mississippi has shown that it is possible to raise standards even in a state ranked dead last in the country in child poverty and hunger and second highest in teen births.” Also, “You cannot use poverty as an excuse.” That’s the most important lesson,” David Deming, Harvard economist and education expert.

Contrast that with NM Senator Mimi Stewart’s “NM doesn’t know how to educate poor students.”

Given New Mexico’s challenges with drugs and alcohol, this quote is pertinent, “I’ve lost too many friends I grew up with to drugs, alcohol and suicide, and as I think about what might have saved their lives, education is high on the list.”

Mississippi has achieved its gains despite ranking 46th in spending per pupil in grades K-12. Its low price tag is one reason Mississippi’s strategy might be replicable in other states. Another is that while education reforms around the country have often been ferociously contentious and involved battles with teachers’ unions, this education revolution in Mississippi unfolded with support from teachers and their union.

Mississippi is a red state. New Mexico is a blue state. Sadly when New Mexico attempted to implement reforms closely resembling Mississippi’s, the unions fought it.

“Perhaps the most important single element of the 2013 legislative package was a test informally called the third-grade gate: Any child who does not pass a reading test at the end of third grade is held back and has to redo the year.”

“In fact, the third-grade gate lit a fire under Mississippi. It injected accountability: Principals, teachers, parents and children themselves were galvanized to ensure that kids actually learned to read. Each child’s progress in reading is carefully monitored, and those who lag — as early as kindergarten and ramping up in second and third grades — are given additional tutoring.”

In fact, the third-grade gate lit a fire under Mississippi. It injected accountability: Principals, teachers, parents and children themselves were galvanized to ensure that kids actually learned to read. Each child’s progress in reading is carefully monitored, and those who lag — as early as kindergarten and ramping up in second and third grades — are given additional tutoring.

Interestingly enough, while Albuquerque Public Schools have received a lot of attention for their bloated budget, it is worth noting that Alamogordo schools plans to spend $153,652,893 to educate approximately 5,600 students next school year. That’s more than $27,000 per-student! 

In the kind of one-person power grab that has become all-too-common in recent years and especially with the Biden Administration, Interior Secretary Deb Haaland has instituted a 10 mile barrier around Chaco Canyon Monument. The ban will last for 20 years (unless overturned by a subsequent administration).

The Navajo Nation recently explicitly rejected ANY barrier around the Monument. However as the Journal reports, the nation had in the past supported a 5 mile barrier.

Haaland’s move is expected to cost Navajo members with allotted property rights an estimated $194 million over the next 20 years.

Naturally, New Mexico’s entire Congressional delegation, all of whom are anti-energy radicals, support the 10 mile buffer.

The Rio Grande Foundation recently analyzed workforce participation data for New Mexico and its neighboring states. Separate data from New Mexico’s Legislative Finance Committee was also discussed in the post.

This attracted the attention of KOAT Channel 7 which did an excellent report on RGF’s data and analysis including discussing the data with a UNM economist who added his cogent thoughts. Check out the KOAT report here and by clicking on the image below:

On this week’s interview Paul talks to Vance Ginn, PhD. Vance is an economist who worked in the Trump Administration, is Founder and President of Ginn Economic Consulting, LLC, Host of the Let People Prosper Show Podcast, and is Chief Economist or Senior Fellow at Multiple Think Tanks.

Paul and Vance discuss reports claiming that California has a lighter tax burden than Texas, ensuring sounds state budgets, and they even dive into immigration policy.

The Legislative Finance Committee’s post-session fiscal review is a trove of interesting information (translated: expect additional posts using information gleaned from it, but have a read for yourself). One interesting item among many is the chart below which shows that even as the Gov. and Democrats who control the Legislature claim to want to “diversify” the economy and even dismiss New Mexico’s role as an energy state, New Mexico’s budget has become even MORE reliant on oil and gas revenues in recent years.

As the chart below shows, more than 50% of New Mexico’s general fund revenues (nearly $7 billion in 2023) comes from oil and gas. As a reminder, the state’s FY 2023 revenues were approximately $11 million (according to the LFC) but it spent $8.4 billion in FY 2023 (the FY 2024 budget was just passed and that is $9.6 billion).

The Rio Grande Foundation has been tracking and discussing New Mexico’s low workforce participation rate for several years. The chart below covers the time period dating back to pre-pandemic January 2020. As you can see, New Mexico’s rate remains much lower than its neighbors’ rates and both New Mexico and Arizona have NOT recovered from the pandemic.  You can find the raw data here.

In their post-session review, the Legislative Finance Committee also looked at workforce participation rates over time among men and women (using separate data set) and found some troubling info. The following charts are from their report. Although the LFC report does not explain their choices, the following charts show New Mexico’s low an worsening workforce participation rate for groups of prime working age adults:

If you drive around Albuquerque for any length of time you’ll notice a lot of trash. Among the places with the largest amount of trash is bus stops. Well, according to Channel 13, the City is asking for volunteers to help clean up the trash around the City’s bus stops this weekend.

The idea is to prepare for ABQ Pride Parade and Route 66 Summerfest. If you are interested in helping out, that is great, we encourage you to do so.

But it also seems that if the City of Albuquerque is serious about boosting ridership on its buses and generally making the City a cleaner, less-polluted (and perhaps an even safer place), perhaps it is time to redirect some of the $3 million in “free” bus money to pay for clean up and enforcement of litter (and other) laws around bus stops.

Having an “official” presence at bus stops might also have a deterrence effect on the rampant shoplifting for which City buses have become a popular “getaway vehicle.”

On this week’s conversation Paul and Wally discuss the contents of the debt ceiling deal. While they agree that it is better than nothing, their “real” interest now shifts to the political battle between the mainstream and left/right in both parties.

Virgin Galactic had a successful launch last week, but their stock plummeted simultaneously. Why? 

In education-related news, Albuquerque Public Schools adopted a massive $2.16 billion budget last week. The Associated Press discovers “Mississippi’s miracle.” The media (and a new study) falsely claim that pre-K is improving New Mexico education. 

There is an impending battle over a massive Santa Fe solar development. Will NIMBY interests or the environmental activists win?

Over the Holiday weekend negotiators in Washington struck a deal relating to the federal debt ceiling that would suspend the debt ceiling until January 1, 2025. The challenge for House Republicans is that they BARELY have a majority in one house in order to gain leverage on spending and their party has not exhibited fiscal restraint in general (as recently as the Trump Administration).  

While we believe the deal is better than the alternative, the interesting question is whether it ultimately is embraced by enough on the right and left to pass. If not, which side kills it and who is blamed if it is killed. New Mexico’s delegation has (so far) been quiet with the exception of Rep. Gabe Vasquez who represents the most competitive seat and has stated his support for the deal.

Here are some of the key provisions:

Via CNN: Under the deal, non-defense spending would remain relatively flat in fiscal 2024 and increase by 1% in fiscal 2025,

Under the deal, $11 billion in rescinded unobligated Covid-19 relief funds and $10 billion in money shifted from the Internal Revenue Service would be used to beef up non-defense discretionary spending. Also, $10 billion in funds repurposed from mandatory programs and $23 billion that’s designated as emergency funding would be shifted.

The agreement calls for temporarily broadening of work requirements for certain adults receiving food stamps.

Currently, childless, able-bodied adults ages 18 to 49 are only able to get food stamps for three months out of every three years unless they are employed at least 20 hours a week or meet other criteria. The agreement would increase the upper limit of the mandate to age 55 in phases, according to the bill text.

The deal would rescind roughly $28 billion in unobligated funds from the Covid-19 relief packages that Congress passed to respond to the pandemic, according to the House GOP,

Under the deal, borrowers would have to begin paying back their student loans at the end of the summer.

The following appeared in the Roswell Daily-Record on May 21, 2023.

The 2023 New Mexico legislative session was generally disappointing for New Mexicans who wish to see much-needed K-12 education reform. However, it was not a total loss. In fact, one bill did pass that could help thousands of New Mexico families pay for educational options that work best for them. Without a single “no” vote during the 2023 session, HB 342 will soon be the “law of the land.”

The bipartisan bill was sponsored in the House by Republican Minority Leader Ryan Lane and by Democrat Majority Leader Peter Wirth in the Senate. It was signed into law by Gov. Lujan Grisham, also a Democrat. HB 342 aligns New Mexico law with federal law as updated during the Trump Administration and recent legislation under the Secure 2.0 Act.

Over the years Congress has expanded the use of 529 plans to pay for kindergarten through 12th grade tuition and included student loan repayment and apprenticeship program expenses. And in 2023, Congress added a provision to allow rollovers of unused 529 plan funds into a Roth IRA for the beneficiary.

Starting on June 16 when this new law takes effect, New Mexico families will be able to deduct any contributions to their New Mexico sponsored 529 account that will be used to pay for up to $10,000 annually (per-child) on tuition expenses at an elementary or secondary public or private school (making them “qualified” expenses under New Mexico law).

Originally created to help families save for college, 529 plans have been helping families do that for years and will continue to do so into the future. For New Mexico residents, features include the fact that 100 percent of contributions to New Mexico’s plans are deductible from state taxable income in the year contributions were made to the account. If the account owner is a resident of New Mexico, then earnings and withdrawals from their 529 account are also exempt from state taxation.

New Mexico’s educational woes have been well-documented in numerous analyses. Families who are considering 529 plans or if they already have such a plan and want to know more about the latest changes can find out more at The Education Plan website https://theeducationplan.com. The Education Plan is New Mexico’s state-sponsored 529 education savings plan.

The website is informative and Rio Grande Foundation has undertaken its own efforts underway to educate New Mexicans, but it is up to families to either find this information for themselves or talk to a financial advisor.

If you have a child for whom the existing K-12 system is not working and you are considering the financial challenges of paying for school (in addition to the taxes you already pay to fund the schools), you should strongly consider looking at using a 529 plan.

This is especially true since the original purpose of 529 plans may not be as critical as in the past. That’s because many college costs in New Mexico are now covered thanks to the State’s “Opportunity Scholarship” program for “free” college. While nothing is truly free, the prospect of college being heavily subsidized by New Mexico taxpayers may change the financial equation for some New Mexico families who no longer need to prioritize saving for college and instead can use their 529 plan for K-12 tuition at a non-public school.

The Rio Grande Foundation has long been a proponent of increasing the educational options available to New Mexicans. While much work is to be done to improve educational options for families, we are pleased that New Mexico’s Legislature is allowing families to maximize the benefits of 529 plans for K-12 students. It is critical for parents of school-aged children to educate themselves on the benefits of these plans.

Paul Gessing is president of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, nonpartisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

According to the Santa Fe New Mexican, construction of the proposed Rancho Viejo Solar facility is under consideration on 800 acres of private land about a mile off N.M. 14. Not surprisingly, pushback is already coming from residents who live near the proposed industrial development.

Before construction can begin on the Rancho Viejo Solar facility, the project must gain approval from county officials.

And, as much as the denizens of Santa Fe usually support wind and solar, I expect this to be a  knock-down battle. While often touted as “green,” the reality is that deploying wind and solar takes a great deal of land (much more than a nuclear facility for example).

As this article from the UK Guardian notes, “What was an oasis has become a little island in a dead solar sea.”

Kevin Emmerich worked for the National Park Service for over 20 years before setting up Basin & Range Watch in 2008, a non-profit that campaigns to conserve desert life. He says solar plants create myriad environmental problems, including habitat destruction and “lethal death traps” for birds, which dive at the panels, mistaking them for water.

He says one project bulldozed 600 acres of designated critical habitat for the endangered desert tortoise, while populations of Mojave fringe-toed lizards and bighorn sheep have also been afflicted. “We’re trying to solve one environmental problem by creating so many others.”

While RGF often finds itself at odds with the NIMBY crowd, we support opposition to heavily-subsidized, not really “green” energy.

On this week’s interview Paul talks to Joe Abbin. Abbin is an Albuquerque author and 36 year veteran of the Albuquerque Police Department. They discuss Albuquerque’s crime issues as laid out in his book, ABQ Blues. You can read the book for yourself at the link.

Congratulations to Virgin Galactic for successfully launching their final test flight from Spaceport America today. Shockingly, as noted in the CNBC article and below, the Company’s stock plummeted by more than 8 percent on the news.

One issue MAY be this Motley Fool article (released today) which highlights the precarious condition of Virgin Galactic’s finances and outlines the tremendous pressure facing the company to get its commercial operations going at a rapid pace this summer.

Here is one particularly concerning statement from the story,

Thus, it seems most likely Virgin Galactic will in fact burn through somewhere between $370 million and $400 million in cash through the end of 2023, leaving it with at most $504 million at the start of next year. If the company manages to fly more frequently than once every other week next year, that might be enough cash to last Virgin Galactic through the end of 2024. But if it can’t, it won’t.

At the Rio Grande Foundation we have commented regularly in recent years on the rapid growth in per-student spending at New Mexico school districts. This is driven by two major factors, New Mexico’s massive budget growth and the ongoing decline in student numbers.

Albuquerque Public Schools, the State’s largest district unveiled its FY 2024 budget (next school year) and it’s a doozy. As noted on the APS website, total district spending for the upcoming fiscal year will be $2.16 billion.

According to the just-passed budget (which we obtained) the District’s enrollment will have dropped (again) to 68,902. So, dividing the $2.16 billion budget by 68,902 students gets you a mind-blowing spending number of $31,349 PER STUDENT!

That’s an increase of almost 69% since 2020 PER STUDENT. Will APS or any of New Mexico’s other school districts be able to move the needle on student outcomes or is the State just pouring good money after bad?

The Santa Fe New Mexican recently ran a story touting yet another study which supposedly promotes the benefits of pre-K and early childhood spending. The report is the National Institute for Early Education Research’s State of Preschool 2022 Yearbook. The report claims that New Mexico’s early childhood programs are “a rare bright spot in New Mexico’s education system.”

Does the report tout the success of kids who have gone through New Mexico’s pre-K programs starting in 2005-2006 school year with the enactment of the PreK Act? No, in fact the study doesn’t even consider student outcomes. Everything is based on access, spending, academic credentials, and class sizes. 

Sadly, for nearly two decades New Mexico has had some kind of taxpayer-financed pre-K yet we have no evidence of outcomes one way or the other. We DO know that 2022 NAEP scores were (if anything) a big step backward due to our dead-last overall ranking but this report provides zero evidence that New Mexico’s new universal pre-K system is going to improve our State’s lousy education outcomes.