The New Mexico House of Representatives passed House Bill 2, the General Appropriations Act, with a bipartisan vote of 53-16 Wednesday.

The state budget proposal for fiscal year 2025 totals $10.18 billion, up 6.5% from last year, while maintaining a 32% reserve.

“We are at a unique moment in New Mexico’s history,” said House Appropriations and Finance Committee (HAFC) Chair Rep. Nathan Small (D-Las Cruces). “Thanks to recent work stabilizing state revenues, we are less fearful about future economic downturns and more focused on investments that create greater opportunities, stronger communities and a more diverse, sustainable economy for all New Mexicans.”

House Bill 2 addresses long-term challenges while also using strategies to improve the lives of New Mexicans. It includes significant investments in working families, community safety, education and child well-being, workforce development, climate resiliency, and infrastructure.

“This is a strong, responsible budget that truly works for our state and will deliver for our communities now and for years to come,” said HAFC Vice Chair Rep. Meredith Dixon (D-Albuquerque).

The budget now heads to the Senate.

“Because of our historic — but prudent — investments made over the last few years in New Mexico in everything from small businesses to hospitals, child care to college, free school meals to law enforcement, the future of our state is brighter than ever,” Gov. Michelle Lujan Grisham said. “Here’s my promise to New Mexicans: I will continue to push for programs, services and solutions that work. Here’s my promise to New Mexicans in future years and future generations: We will continue to spend within our means, responsibly and with an eye toward accountability, always, while capitalizing on the fiscal opportunities available.”

Some key investments in the budget include:

Education

HB 2 includes $4.43 billion in recurring funds for public schools, as well as $200 million in nonrecurring appropriations, to expand K-12 programs, career technical education, structured literacy, teacher mentorship, and community schools. Other key investments include:

  • $50 million for the Tribal Education Trust Fund
  • $75 million for a pilot program to help fill hard-to-staff special education positions and study educator clinical practice programs
  • 4% salary increases for public and higher education employees to help with educator recruitment and retention

The budget increases funding for the Early Childhood Education & Care Department by 6%, including $17.6 million to expand pre-K services and $2 million for quality support to providers.

It also increases the distribution from the Early Childhood Trust Fund to $250 million, with:

  • $75 million for child care assistance
  • $12.2 million for home visits, infant health services, doula services and lactation support
  • An $11 million increase to support childcare providers

The Higher Education Department will receive $1.3 billion in recurring funds, including:

  • $7 million for faculty pay
  • $3 million for student support initiatives
  • $2 million for graduate student worker compensation
  • Over $2 million in additional funding for nursing and health care programs

The budget also fully funds Opportunity Scholarship using revenue from the Higher Education Financial Aid Endowment Fund.

Workforce Development

HB 2 dedicates $100 million, the most significant investment ever, to developing a strong workforce for New Mexico. This includes:

  • $15 million for medical professional loan repayment
  • $10 million for graduate STEM scholarships
  • $60 million for workforce training and apprenticeships at community colleges
  • $10 million for grant matching for technology projects tied to economic development

The Department of Workforce Solutions will receive a special appropriation of $30 million for apprenticeship programs, and an increase of $1.16 million for recruitment for in-need professions, including:

  • $6 million to pilot a career-interest simulation program for trade professions
  • $1.8 million to pilot pre-apprenticeship programs to engage young adults

Child well-being

The budget makes key investments in improving Children, Youth and Families Department, including funds to recruit, train, and support foster care providers, with:

  • $20 million to pilot evidence-based strategies for improving workforce development, prevention and early intervention programs, and differential response
  • An increase of $1 million in federal funding from the Temporary Assistance for Needy Families (TANF) block grant for the Fostering Connections program, which allows youth who age out of foster care to opt into support programs until age 21
  • An increase of $2.5 million to address settlement requirements, and to replace children’s social security benefits that were previously used to support foster care costs

Community safety 

HB 2 invests a total of $531 million in public safety, including funds dedicated to:

  • Providing necessary equipment
  • Reducing vacancy rates in law enforcement
  • Funding new positions focused on crime reduction and ongoing investigations

The budget also invests $24 million in the judicial system, an increase of 6%, to fund:

  • Important safety and IT upgrades
  • $1.5 million to improve monitoring of individuals on pretrial detention

HB 2 makes the largest funding increase to date for the New Mexico Crime Victim Reparation Commission, providing a total of $7 million, including:

  • $4 million for victim advocates,
  • $1 million for sexual assault victims,
  • $2 million to supplement federal grants for crime victims.

Investments in the budget also seek to address the root causes of crime, including support for:

  • Behavioral healthcare
  • Substance use treatment
  • Poverty-reduction programs
  • And access to quality education and healthcare

HB 2 also invests a critical $2.3 billion in housing, including funding for:

  • New housing development
  • Supports for home ownership
  • Weatherization and rehab
  • Supportive housing, such as shelters for victims of domestic violence, the Linkages program, housing vouchers, re-entry services, and transitional housing for youth aging out of foster care

Health care

The budget increases funding for the Department of Health by $11.7 million or 6.3%, including:

  • $1 million to replace declining tobacco settlement fund for tobacco cessation services
  • Over $600,000 for public health office operations and staff
  • $1 million for the public health hotline
  • $970,000 for program support and IT

The Aging & Long-Term Services budget is increased by 8.5%, including $5 million for the Kiki Saavedra Senior Dignity Fund to provide transportation, food security, health care, case management, and caregiving to senior citizens.

The budget also increases funding for Medicaid by 11%, including almost $63 million to support critical rate increases for:

  • Primary, infant, and maternal care providers
  • New Mexico’s smallest rural hospitals
  • Rural and primary care clinics
  • Providers in developmental disability waiver and behavioral health systems

Additional health care investments include:

  • $3 million to support the vital rural health care provided by Tribal Health Councils
  • Increasing services for infants exposed to illicit drugs and treatment for mothers, utilizing funding from opiod settlements

Climate and environment

The budget is also greatly increasing New Mexico’s investment in our environmental conservation agencies to help them staff up and operate effectively, including:

  • A 12.4% increase for the Energy, Minerals, and Natural Resources Department (EMNRD) to support regulation of the oil and gas industry, expand firefighting efforts, and boost staffing at state parks
  • A 19% increase for the Environment Department to support staffing and regulation
  • $10 million for a new “Green Bank” to improve access to infrastructure for solar, wind, and geothermal energy, and weatherization support for underserved New Mexicans
  • $300 million to the Land of Enchantment Legacy Fund for conservation, supporting 10 programs across six agencies
  • Increased funding for the State Parks, Oil Conservation Divisions, and the Mine Reclamation Program to support implementation of the Water Data Act

Infrastructure and technology

The budget includes $150 million for the Department of Transportation for major infrastructure and maintenance improvements for our roads and highways.

It also includes $5.5 million for the Department of Information Technology to consolidate cybersecurity in state agencies.

The budget also builds on our investments over the last several years in broadband with $25 million to help New Mexicans get and stay connected.

Economic development 

HB 2 invests in proven economic drivers and creative new initiatives to bring needed diversity to our economy, with:

  • $13.5 million for the LEDA fund and site readiness
  • $175 million to expand the Opportunity Enterprise fund, including support for housing
  • $200,000 for local grants for creative industries
  • $1 million in funding for the Climate, Energy, and Water Authority and Project Fund

Investments in the Tourism Department are up 4.4% with funding to staff vacancies, as well as:

  • $900,000 for the cooperative marketing & advertising program
  • $100,000 for the travel trade program
  • $16 million for national advertising

Finally, the budget also allocates $1.187 billion to a series of endowments and trusts to support future spending, including natural resources, housing, and government innovation projects.

Other special appropriations include:

  • $50 million for agencies and tribes to have matching funds for federal grants
  • $100 million to supplement water trust board projects
  • $20 million for Indian water rights settlements
  • $80 million for rural health care expansion, along with a three-year expansion in funding for behavioral health