KOAT TV Channel 7 and the Rio Grande Foundation are both tracking COVID 19 spending in New Mexico. You can find an interactive chart for New Mexico and other states here.

Notably, New Mexico’s COVID 19 spending is concentrated in areas of the State that have had serious impacts from the Virus. Also, New Mexico has received MUCH more money from the Feds than other states including those of similar populations (like Nebraska).

You can click on the screenshot below or click here to watch the story.

On this week’s discussion, many topics including: Balloon Fiesta canceled and with it the $187 million annual impact. Will the State Fair and other events be next?

On Friday David Scrase put New Mexico’s opening on hold for 2 more weeks. What metrics are they using anyway?  WalletHub study reports that New Mexico is the state with the most coronavirus restrictions.

Albuquerque’s two “dollar theaters” have closed permanently.

The Legislature met (in relative secret). What happened and what about the NM Supreme Court case that allowed this to happen?

New Mexico is 50th again in Kids Count Report. What will schools look like this fall? We may have a better understanding than before.

It’s back…Albuquerque’s mandatory paid sick leave could be voted on as early as June 29th.

There’s no doubt that New Mexico’s reopening has been chaotic and seemingly based on mere whims as opposed to science. On Friday with the Legislature’s special session taking most of the media attention, David Scrase, the Gov’s health/COVID 19 “guru” held his own press conference (without the Gov.) to tell New Mexicans that the reopening of our State will be on hold for at least two weeks (from July 1).

Of course, based on the Gov.’s original phased opening plan which was released back in late April we are WAY behind in terms of reopening. As the screen shot below shows, the original plan was for theaters, bars, and casinos to have opened in early June.

Also, as we have noted elsewhere, there are STILL numerous businesses and services that seem to have fallen through the cracks: studio gyms (like yoga and pilates), amusement parks, swimming pools, entertainment centers, wineries, and more continue to be shut down with no reopening in sight. Churches remain at 25% capacity.

Is there a rhyme or reason to the Administration’s policies? If so it is hard to tell. At the Rio Grande Foundation and along with Power The Future NM we released a plan several months ago to “Fairly Open” New Mexico. Of course, as someone from out of state recently complained with regard to this situation (and a planned meeting here), “Your state does not make it easy to find info. LOL!” Before this post was even finalized we found out that the International Balloon Fiesta has been canceled for 2020. Major events with large numbers of people would be tricky under COVID 19 circumstances, but one wishes we had a clearer path forward than the one Gov. Lujan Grisham’s Administration has given us.

New Mexico’s School Reentry Task Force has made its recommendations for how schools will look this fall. If the Gov. adopts them the educational experiences of the State’s children will look dramatically different and I suspect that many more students will opt for school choice or even home school options. KOB TV has a story here. The full recommendations are here.

Among the most important recommendations are:

• All students and staff wear masks;
• Take temperatures of all students and staff;
• Maintain 6 feet of social distancing;
• Avoid field trips;
• Staggered attendance.

There are numerous questions and points to be made about this. Obviously the mask issue is a big one. Wearing a mask for long periods of time is uncomfortable for disciplined adults. Getting young children and teenagers will be a major challenge.

Maintaining social distancing is also going to be a deal breaker. For young people the social aspect of school is a major component of the entire experience.

Staggered attendance sounds like a good idea, but the real result for parents would likely be days spent hauling kids back and forth from school. Admittedly child care is a big part of what parents get out of education. Forcing them to run students to and from school throughout the day is not going to please anyone.

Will non-public school or charter schools be more innovative or open than these recommendations provide? Will home schooling experience an unprecedented boom as many expect?

On this week’s interview podcast, Paul interviews Rep. Rebecca Dow. Paul and Rebecca discuss the recent primary election results and the major changes that will be taking place in Santa Fe in 2021. They also discuss the impending special session of the New Mexico Legislature and what will or won’t happen. At the time of recording, they were not privy to the New Mexico Supreme Court’s decision NOT to open the Roundhouse to public participation in the session.

Finally, Rebecca and Paul discuss the situation at Elephant Butte Lake State Park which is in Rebecca’s district and how that facility is being opened by the State. They also discuss the possibility of state meat inspections and how that could help New Mexico based ranchers.

Leave it up to the “leadership” of a City already distracted by stark public safety issues in a State that is embarking upon a controversial special session after a long period of economically-devastating “lockdown” to decide “now is the time to impose a costly new sick leave mandate on local businesses.”

You can read about the proposal (although it is complicated and unclear) in the Albuquerque Journal.

Forcing Albuquerque businesses to pay mandatory sick leave is much the same as a tax increase which the Rio Grande Foundation has advocated so strongly against in the Legislature.

The LAST thing that businesses (many of which remain shut down) already struggling to recover from the unprecedented impact of the COVID-19 pandemic. Forcing businesses to pay out significant amounts at a time when revenue is way down will lead to more businesses closing and more
lost jobs for our city.

Of course Albuquerque voters  already rejected mandatory paid sick leave in 2017, but that wasn’t the result the well-funded advocacy groups and “progressive” city councilors wanted, so here we are.

Email members of the Albuquerque City Council and tell them “No paid sick leave mandate!” You can read the text of the proposed ordinance here.

Lan Sena: lansena@cabq.gov
Isaac Benton: ibenton@cabq.gov
Klarissa Pena: kpena@cabq.gov
Brook Bassan: bbassan@cabq.gov
Cynthia Borrego: cynthiaborrego@cabq.gov
Pat Davis: patdavis@cabq.gov
Diane Gibson: dgibson@cabq.gov
Trudy Jones: trudyjones@cabq.gov
Don Harris: dharris@cabq.gov

The Special Session starts June 18 and there is going to be a lot on the agenda for the Legislature to consider in a very short time and with minimal public involvement.

For starters, there is the budget which is the primary reason for the Session in the first place. The executive budget framework includes cuts to state agency budgets, grants to local governments and sovereign nations and a preservation of a portion of the pay raises that had been scheduled for educators while using the state’s unprecedented reserves and federal funding to patch the budget hole created by the shutdown of New Mexico’s economy and the COVID-19 pandemic.

RGF’s take: It is important that the bloated budget passed in 2020 be adjusted, but it appears that the Gov. and the Legislature will wait on the 2021 session to make most of the hard choices about further cuts to New Mexico’s government.

Unfortunately, many of the proposed bills are simply not available online as the session kicks off.  So, we are basing these discussions on descriptions in an article by Dan Boyd of the Albuquerque Journal.

• Require police to wear cameras, ban chokehold restraints and make officers’ disciplinary history a matter of public record under the state’s Inspection of Public Records Act. She is also asking lawmakers to establish a commission to evaluate ending qualified immunity for police officers, a legal doctrine that helps protect officers from civil lawsuits. (RGF does not take a position on these issues although a commission to study qualified immunity is worth convening).
• Authorize county clerks, during a public health emergency, to mail ballots to registered voters without requiring the voter to fill out an application first. Ballots would go to voters with a current address, the governor said, and voters and election officials could track the ballots’ progress through the mail. (RGF has serious concerns about all-mail voting).
• Waive penalties and interest for small businesses and individuals who are unable to pay their property and gross receipts taxes on time. (This is a good move)
• Grant the administration extra flexibility to help businesses during an emergency by, for example, allowing liquor delivery or electronic notary services. (This has merit, but details are necessary because there are potential pitfalls inherent in empowering ANY governor)
• Direct the state investment officer to use some of the $5 billion Severance Tax Permanent Fund for loans to help small businesses and municipalities damaged by the pandemic. (It sounds like this is a diversion of money that would already be “invested” by the SIC as opposed to tapping additional revenue. If so, this is a sound idea)

As discussed above, this is what you got if you looked for “all bills” introduced in the 2020 special session.

The Rio Grande Foundation is not a fan of teachers unions or any public employee unions. We share President Franklin Roosevelt’s concern that unionizing public employees is very different from unionizing private sector employees.

But, a natural experiment that resulted in a study out of Yale University adds to the strength of our argument. As the screenshot below clearly states, “mandatory teacher bargaining laws increase the performance of high-achieving students while simultaneously lowering the performance of poorly achieving students.”

The logic is simple. In the absence of collective bargaining (unions) districts can use incentives to encourage the best teachers to go into tougher, low-income and minority schools. With unions negotiating on teachers’ behalf the best teachers choose to go to the best (easiest) schools.

It would seem that the issue of collective bargaining should at least be on the table as New Mexico works to improve outcomes for disadvantaged students, but you can count on the unions to work very hard in opposition to anything that weakens their power.

On this week’s discussion episode, Paul and Wally discuss the Special Session of the New Mexico Legislature which begins June 18. As of the recording of this podcast, it will NOT be open to the public. That decision has been appealed to New Mexico’s Supreme Court.

When the Legislature DOES meet Wally and Paul believe that the Legislature will largely“kick the can” down the road to beyond the November election.

Gov. Lujan Grisham has reopened breweries as the RGF requested recently.  Bars, fitness studios, entertainment centers remain closed.

Paul has recently been on KOAT TV Channel 7 discussing various potential budget issues.  One story addressed the $34 million in COVID 19 expenses.

The Rio Grande Foundation has long argued that New Mexico needs to develop its private sector economy beyond the oil and gas industry (we support oil and gas, but believe New Mexico relies too much on this volatile source of jobs and revenues).

A new report from Wallethub confirms that New Mexico is the MOST reliant state in the nation.

Check out the interactive map below:

The other “most reliant” states are Kentucky, Mississippi, and West Virginia.

Arizona a 9th-most reliant is the most reliant state bordering on New Mexico while Utah at 46th is the least reliant.

Due to the shutdown of New Mexico’s economy during the COVID19 outbreak New Mexico businesses have had to furlough or let go large numbers of their workers. This is going to potentially have serious repercussions for the State’s unemployment insurance fund and the payments those businesses must make to that fund.

This article by Carol Wight of the New Mexico Restaurant Association addressed the issue from the 2008-2009 economic crisis. Unfortunately, if the political leadership of New Mexico is not prudent, businesses could be deeply impacted, even if they are able to recover from the shutdown.

You can watch the story here:

On this week’s interview podcast, Paul sits down with Roswell Mayor Dennis Kintigh. Paul and Dennis discuss the economy of Southeast including the increased economic impact of the old Walker AFB. Dennis is a former State legislator so the two discuss Dennis’ work in the Legislature on limiting film subsidies and they also talk about the big shifts in the Legislature in the recent primary election.

With New Mexico’s Special Session to begin (in darkness) on June 18, the Gov. has finally put out her main proposals for addressing the economic situation. KOB TV Channel 4 has the details (the proposals weren’t listed on the Gov.’s official website).

According to KOB, the plan is to:

• Use $725 million of federal coronavirus relief funds
• Tap the state reserves.
• Refinance road projects and reduce pay raises for state employees from 4 to 2   percent.

The Gov. added that “furloughs and layoffs are not on the table.”

In other words, no serious action will be taken to address the budget. While many businesses STILL remain shut down by order of the Gov. and the economy struggles to regain momentum New Mexico government employees will not only NOT suffer any pain from being “all in this together,” they will see pay raises.

1) The Gov. is hoping that recent “progressive” gains will give her the freedom to tap New Mexico’s various permanent funds in January and beyond if needed. Some of those dollars may be used to support businesses impacted under COVID19 in a move that could prove politically-popular (providing support/stimulus for businesses without raising taxes by tapping permanent fund dollars);

2) The Gov., however, doesn’t want to do anything politically-unpopular (program cuts or tax hikes) before November’s election.

3) As the newly-minted leader of the Senate “progressives” Sen. Jerry Ortiz Y Pino outlined in a recent column, tax hikes are very much on the table.

1. 1. .

   

$34 million and counting is what New Mexico has spent so far on fighting COVID19. Federal CARES Act money should be available and more than enough so as to not impact New Mexico’s budget (the shutdown is another matter).

But, as Gessing cautions in his brief comment for the story here and on the picture, politicians have a tendency to spend money for purposes that aren’t necessarily as intended.

By now you may have heard that the special session set to kick off in Santa Fe on June 18 will be closed to the public. Set aside the constantly changing “science” behind the lockdowns and the ongoing restrictions on our personal liberties. The simple truth is that if New Mexicans can shop in big-box stores and malls with some restrictions, they should be able to weigh in on the future of their state and the (as of yet unknown) policy changes being proposed by Gov. Lujan Grisham.

Yes, the New Mexico Legislature is SUPPOSED to meet in public. But the majority can make its own rules, so it is Democrats only who get to determine whether the public is allowed in although I think the courts will have the final say.

Ultimately, more innovative solutions could be put into place. After all, committee meetings already have limited space due to fire restrictions. The same could be done just on another level with entrance to the building itself and Committee rooms themselves.

On this week’s Tipping Point New Mexico discussion Paul and Wally discuss the fact that over the weekend Paul got tested for COVID 19. He was not feeling well late last week and went ahead and got the test. It was negative, thank goodness. Paul explains the process and what happened.

There’s a serious discussion going on in Minneapolis and other cities about abolishing the Police. Others are discussing reforming the police. What can actually be done? Parallels between police unions and teachers’ unions.

In the biggest New Mexico-specific news of the last week, the recent primary election means some big changes are ahead in New Mexico’s Legislature. Paul and Wally discuss the results and likely political and policy outcomes for New Mexico.

Adding on to that discussion of the Legislature, Sen. Jerry Ortiz y Pino’s writes in the Albuquerque Journal with an absurd “plan” to eliminate oil & gas in NM. Wally and Paul discuss the rise of Ortiz y Pino from “Comrade Jerry” to being the de-facto “leader” of the NM Senate’s “progressives” and why you can’t dismiss his insanity out of hand.

Good news? A national poll from Wallethub shows that Americans overwhelmingly oppose tax hikes. Question: After the economy recovers, should tax rates go up to cover the cost of coronavirus pandemic?

Finally, Paul and Wally have a brief conversation about the special session and what, if anything will happen.

Comparing school districts in New Mexico is often challenging. Albuquerque Public Schools (APS) is one of the largest districts in the entire country. With that come certain “efficiencies of scale” as well as some serious drawbacks.

The answer is to compare similar districts with roughly similar demographics across state lines. Laura Abendroth a policy analyst with the Rio Grande Foundation has crunched the numbers in a detailed research project on the issue of school funding among various school districts of similar demographics. The paper is, “Albuquerque Public Schools v. Southwestern Regional School Districts: How Does Spending and Student Performance Stack Up?”

In advance of this project Abendroth considered numerous large school districts in states surrounding New Mexico. The primary consideration (aside from size) was demographics and poverty.

In addition to APS, Abendroth studied the Austin (TX) ISD, Fort Worth ISD, Denver Public Schools, Mesa Public Schools, and Alpine (UT) Public Schools.

Making solid comparisons across state lines is never easy. For example APS has the highest percentage of Hispanics and Native Americans of the districts studied, but APS has a lower percentage of “English Language Learners” than any district beside Alpine.

Abendroth found (during the 2019-2020 school year) that while Austin ISD’s spending is quite high relative to ALL other districts studied at $28,000 per pupil, APS spends the next-largest amount at $17,571. Denver spent $16,000 per pupil and the other districts all spent $11,000 or so. So, APS is a relatively big-spender on a per-pupil basis.

Indeed APS spends about 20% of its operating budget on capital projects while the other districts spend just 10% of their budgets. Notably, most of those districts have smaller overall budgets, thus making that capital outlay figure even larger in real terms.

Also, APS DOES spend a lot of money in the classroom. In fact, APS class sizes are just 10.7. Austin and Fort Worth are in the mid-teens per class while Denver and Mesa are very close to 20. Alpine School District has 23.6 students on average.

Unfortunately for APS students all of this spending and extra attention in the classroom doesn’t have the impact we would like. Across the board (in terms of graduation and 4^thand 8^thgrade reading and math NAEP scores) APS only outperforms Fort Worth ISD. To be blunt, APS taxpayers are not really getting their money’s worth.

While solutions are beyond the scope of Abendroth’s paper the Rio Grande Foundation has touted more robust “school choice” options, elimination of LEED mandates and “Prevailing Wage” laws both of which drive up construction costs, and reduction in overall District overhead.

UPDATE: this post was written on Tuesday, June 9. The Gov. announced the partial reopening of breweries on June 11. Bars remain closed.  

As with so many aspects of our Gov.’s economic shutdown the “science” behind the ongoing shutdown of bars and breweries just doesn’t add up. The  Gov.’s plan is here. It doesn’t even mention bars and breweries (who, by the way have been incredibly quiet and patient during this shutdown).

One assumes that the reasoning behind the shutdown goes something like this: people drink at these places and drinking can cause a loss of judgement, thus a loss of “social distancing.”

That is all fine, but many breweries in particular have patios and outdoor seating. It seems hard to believe those couldn’t have been opened months ago. Of course the difference between a “restaurant” and a “bar” or “brewery” is not always apparent. It simply has to do with the percentage of food sold relative to alcohol. 

New Mexico’s brewing industry was one of the State’s real economic success stories due in large part to some big tax changes made by the Legislature. One wonders how these businesses are faring and how many of them will open when the Gov. finally allows them to get back to business. One hopes that is on June 15 (or even June 12 to get the weekend started).

Sen. Jerry Ortiz y Pino has been in politics a long time. We even see eye-to-eye on a small handful of issues and our interactions have always been cordial (I wish I could say the same about other New Mexico “progressives.” But, his recent opinion piece in the Albuquerque Journal in which he argued that New Mexico should “end its oil revenue addiction” is foolhardy and dangerous.

While you should read the piece for yourself, Ortiz y Pino essentially argues that New Mexico should stop “relying” on oil and gas revenues. He doesn’t imply shutting down the entire industry. Indeed his argument is not directly an environmental one. However, he implies that there is some realistic way for New Mexico government to keep spending at current levels while completely eliminating 30% (he claims) or more of the State budget (oil and gas). Other reports say oil and gas are 40%, but at this point who’s really counting?

What does Jerry argue should replace the Industry? If you said tax hikes, you are a WINNER! He wants to “eliminate” Bill Richardson’s tax cuts, Susana Martinez’s tax cuts, eliminate GRT exemptions, tap the (oil and gas generated) Land Grant and Severance Permanent funds, raise capital gains taxes, and increase taxes on alcohol, tobacco, and gasoline.

Truly, this is a recipe for economic disaster. But, with “moderates” like John Arthur Smith riding off into the proverbial sunset, “progressives” especially those who have seniority like Ortiz y Pino will be empowered. If he gets his way good luck New Mexico!

The good news is even former Gov. Bill Richardson opposes raising taxes. So do 72 percent of Americans according to a recent poll from WalletHub. The Rio Grande Foundation is collecting legislative/candidate pledges to NOT raise taxes

Prior to the COVID-19 outbreak in New Mexico, the Four Corners region of New Mexico faced serious economic challenges. The declining price of natural gas which had been the basis of the area’s economy for decades was the most significant issue.

The price which exceeded $15 per million cubic feet (MCF) back in 2008 embarked on a rapid decline with the advent of the “fracking” revolution. The price is now below $2.00 per MCF and shows no sign of rising in the foreseeable future. That’s a decline of over 80%.

The next “shoe” to drop was the Gov.’s Energy Transition Act which placed the San Juan Generating Station on a path to closure in June of 2022. Efforts by the City of Farmington and Enchant Energy could result in the plant remaining open beyond that deadline.

What is Governor Lujan Grisham’s position on the Enchant Energy project?  No one seems to know. This critical economic issue like so many others has taken an extreme distant back seat to COVID-19.

The Four Corners region needs a Governor and state government that can do more than one thing at the same time. San Juan Generating Station’s employees, and Four Corners’ government officials and economic planners could certainly benefit from state government leadership.

In addition to the extreme energy industry challenges, the Four Corners has also been disproportionately hit by the effects of COVID-19. The Four Corners region has been hard-hit by the virus and has faced stricter timelines for its opening and subsequent economic recovery. The result has been job losses and severe decreases in economic activity for the Navajo Nation and the region as a whole far greater than many other parts of New Mexico.

Add on top of all of these factors and the Gov. is facing a second impactful decision regarding the so-called “Methane Rule.” The Gov. is expected to impose some kind of new regulatory regime on natural gas producers, predominantly in the Four Corners in the months ahead. While environmentalists claim an untold bounty will be reaped in the form of capturing “vented and flared” methane, the reality is that strict rules as proposed by the environmental community would further devastate the region.

All of this is to say that Gov. Lujan Grisham literally holds the Four Corners’ future in her hands. No amount of job retraining money will prepare the local population for jobs that don’t exist. No amount of corporate welfare or state “investment” in things like movie studios will get the region on solid economic footing.

Rather, the region needs real jobs and real economic investment the likes of which job training and government “investment” simply can’t offer. Enchant Energy must be given an opportunity to make its carbon capture technology work. If it doesn’t or if economic conditions show that it is just not feasible, so be it, but the opportunity to keep hundreds of jobs and millions of dollars of economic activity and tax revenue in the region and State simply can’t be dismissed. However, if the carbon capture technology works New Mexico will find itself on the forefront of a new form of green, carbon-free energy.

Likewise, any methane rule must be designed with the realization that if the San Juan region becomes too costly in terms of regulations, natural gas producers will permanently close all but the highest producing wells, and more and more business will leave the state.  Given the massive surplus gas production and rock-bottom prices, it is hard to see additional producers and the jobs they bring ever returning to the region.

New Mexico is quickly heading from the proverbial “penthouse” to the “poorhouse” based on 40% of its budget (oil and gas) essentially evaporating overnight. The Four Corners faces even greater challenges thanks to economic forces beyond their or the Gov.’s control. Inflicting further, unnecessary economic damage on the region would be inexcusable.

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

On this week’s episode, Paul sits down with Tom Mullins. Tom is on the Board of the Rio Grande Foundation. He is in the oil and gas industry and resides in the Four Corners area (Farmington). That area of our State has suffered serious economic challenges for more than a decade as natural gas prices have dropped significantly. Worse, they recently were hard-hit by the COVID-19 epidemic with even some of Tom’s family members dealing with the issue.

As if that is not all bad enough there are two significant additional economic threats to the region in the form of the shutdowns from the Energy Transition Act and the Governor’s Methane Rule. Both of those could have further, negative impacts on the already-struggling region.

All is not lost, however, as Tom and Paul discuss there is a potential carbon sequestration plan that could save the Generating Station and with the Virus threatening big cities, the Four Corners with its wide-open spaces could be a more attractive destination for people looking to relocate. Finally, efforts are in the works to bring a rail spur to the area.

Among the calls for racial unity and reform in the wake of the death of George Floyd there have been serious conversations on the left for what seems like the first time regarding police unions. Free marketeers (especially more libertarian types among them) have long advocated for reform or abolition of police unions and those calls have grown stronger as well. 

We applaud New Mexico Rep. Javier Martinez and any other political leader of any party who is willing to seriously explore reforms to government unions that operate under a monopoly and often with little to no accountability.

Of course, as the following shows police unions and teacher unions operate in similar ways and conditions. Notably, the negative impacts of both police and teacher unions have disproportionate negative impacts in and on impoverished and communities of color.

New Mexico’s Democratic leaders MAY be willing to discuss police unions and that is a welcome development. There is practically zero interest in addressing teachers’ unions, however.

On this week’s podcast discussion Paul and Wally discuss the George Floyd protests/riots in Albuquerque and around the nation.

The protests are happening in the shadow of COVID 19 with businesses having been shut down for several months. There are so many issues going on, but are cities as we know them dead?

SpaceX launches the first American manned space flight in nearly a decade to the International Space Station. This is a big day for privatized space flight and just in general good news for the country.

Gov. starts opening New Mexico a bit further. Paul and Wally discuss the details.

Primary election Tuesday. RGF got dragged into a SE NM primary. Paul and Wally discuss what is happening this primary election day.

Finally, online sales giant Amazon.com comes to NM. Paul and Wally share a few thoughts on this momentous occasion.