New Mexico
New Mexico Legislative Finance Committee releases $10.8B budget recommendation • Source New Mexico
New Mexico’s Legislative Finance Committee on Wednesday recommended $10.8 billion in spending for the 2025-2026 fiscal year from the state’s general fund, a 5.7% increase over 2025 planned spending.
In a statement, Sen. George Muñoz (D-Gallup), LFC chairman and chair of the Senate Finance Committee, said “fiscal restraint has been critical to our successful efforts to transform the revenue boom of the last few years into long-term support for state services.” He continued to say the lawmaker’s intended budget recommendation balances increasing New Mexican’s income, health care and quality of life while saving for the future.
Democratic lawmakers held a news conference Wednesday to present their recommendations, which include $3 billion in one-time spending: $50 million for regional recreation centers and quality of life grants; $350 million for transportation projects; $855 million for special projects and $1.7 billion in transfers to endowments and other funds.
The budget also allocates 45% of the $577 million increase in recurring general fund spending to public education, primarily toward the formula-based state equalization guarantee distribution to school districts and charter schools.
Other budget highlights include:
• a 3% increase, or $36 million to the Higher Education Department
• approximately $79 million more to the Health Care Authority, primarily for Medicaid
• an average 4% increase for higher education and state employee salaries— $134 million.
“New Mexico is in the best financial situation it’s ever been in its history,” Muñoz told reporters Wednesday. “If we do maintain responsible policies in New Mexico, we’ll continue on this path to growth for the next 10 years.”
Gov. Michelle Lujan Grisham’s budget recommendations, which she released in December, call for $10.9 billion in recurring spending overall, including $172 million for state employee and educator raises.
Senate Majority Leader Peter Wirth (D-Santa Fe) said the Legislature’s budget proposal is “not that far apart” from the governor’s proposed budget, “and that’s a really good thing going into a session.”
The committee’s plan allocates 33% of planned spending for reserves; the governor’s recommends maintaining reserves at 30.4%.
In a statement, Department of Finance and Administration Cabinet Secretary Wayne Propst said the agency released the executive budget recommendation “earlier than ever to give both the public and the Legislature ample time to review and understand our plan before the LFC presented theirs.”
“We appreciate the effort that went into the LFC recommendation and agree that both recommendations align on key priorities and are very close to each other. Where differences exist, we look forward to working through them with the appropriating committees,” Propst said. “We’ve been proactive in building strong reserves and setting aside billions for the future. These next 60 days will test our collective resolve to resist unnecessary spending and stay focused on building a strong and stable financial future for New Mexico.”
Senate President Pro Tem Sen. Mimi Stewart (D-Albuquerque) also noted the budget includes a community benefit fund for electrification, transportation and clean jobs infrastructure designed to help local communities lower greenhouse gas emissions, and have healthier air, land and water.
Overall, House Appropriations and Finance Committee Chair Rep. Nathan Small (D-Las Cruces) said the budget focuses on making New Mexicans’ lives better immediately and in the next decade and beyond.
Wise spending in this budget will allow for sustained future raises for public servants like teachers, police officers, health care workers and others, Small said, “whereas in past cycles, it was a boom-and-bust approach.”
“We have an enviable opportunity in order to spend increased amounts today, while also saving for the future,” he said.
GET THE MORNING HEADLINES.
After years of failure to land a “big fish” business for New Mexico’s economy (or effectively use the oil and gas revenues to grow the economy) Gov. Michelle Lujan Grisham with the help of her Economic Development Secretary Rob Black have lured no fewer than three large data centers to New Mexico. These data centers are being built to serve the booming world of Artificial Intelligence (AI), and they will have profound impacts on New Mexico.
It is our view that having these data centers locate in New Mexico is better than having them locate elsewhere. While we have many differences of opinion with this governor, we are pleased to see her get serious about growing and diversifying New Mexico’s oil-dependent economy albeit quite late in her second term.
Sadly, the governor and legislature have chosen not to use broad based economic reforms like deregulation or tax cuts to improve New Mexico’s competitiveness. But, with the failure of her “preferred” economic development “wins” like Maxeon and Ebon solar both of which the governor announced a few years ago, but haven’t panned out, the focus on a more realistic strategy is welcome and long overdue.
Currently, three new data centers are slated to be built in New Mexico:
- Oracle’s Project Jupiter in Santa Teresa with an investment of $165 billion.
- Project Zenith slated to be built in Roswell amounts to a $11.7 billion investment.
- New Era Energy & Digital, Inc. While the overall investment is unclear, the energy requirement is the largest of the three at 7 gigawatts (that’s seven times the power used by the City of San Francisco).
What is a data center? Basically, they are the real-world computing infrastructure that makes up the Internet. The rise of AI requires vast new computing power. It is critical that these facilities have uninterrupted electricity.
That electricity is going to be largely generated by traditional sources like natural gas and possibly nuclear. That contravenes New Mexico’s Energy Transition Act of 2019 which was adopted by this Gov. and many of the legislators still in office. Under the Act electrical power emissions are supposed to be eliminated in a few years.
With the amount of money being invested in these facilities and the simple fact that wind and solar and other “renewable” energy sources aren’t going to get the job done. In 2025 the Legislature passed and MLG signed HB 93 which allows for the creation of “microgrids” that won’t tax the grid and make our electricity more expensive, but the ETA will have to be amended or ignored to provide enough electricity for these data centers. There’s no other option.
New Mexicans have every right to wonder why powerful friends of the governor can set up their own natural gas microgrids while the rest of us face rising costs and decreased reliability from so-called “renewables.” Don’t get me wrong, having these data centers come to New Mexico is an economic boon.
But it comes tempered with massive subsidies including a 30-year property tax exemption and up to $165 billion in industrial revenue bonds. New Mexico is ideally suited as a destination for these data centers with its favorable climate and lack of natural disasters like hurricanes, tornadoes, and floods. We shouldn’t be giving away such massive subsidies.
Welcoming the data center boom to New Mexico better than rejecting them and pushing them to locate in other states. There is no way to avoid CO2 emissions whether they happen here or somewhere else. But, there are questions about both the electricity demand and subsidies that must be addressed as New Mexico’s data center boom begins.
What will the Legislature, radical environmental groups, and future governors of our state do to hinder (or help) bring these data centers to our State? That is an open question that depends heavily on upcoming statewide elections. It is important that New Mexicans understand and appreciate these complicated issues.
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
SANTA FE, N.M. (KFOX14/CBS4) – The New Mexico Department of Health says it will continue to recommend the full schedule of childhood vaccines.
State officials announced the move Tuesday, directly defying a new federal policy that scaled back routine immunization guidance.
The announcement comes after U.S. Health and Human Services (HHS), under Secretary Robert F. Kennedy Jr., reduced the number of vaccines it recommends for all children.
The New Mexico Department of Health stated the federal changes were “not based on new scientific evidence or safety data.”
“New Mexico will not follow the federal government in walking away from decades of proven public health practice,” said Governor Michelle Lujan Grisham. “Our recommendations remain unchanged.”
State health officials sought to reassure parents, emphasizing that vaccines remain widely available and covered by insurance.
“We know this is confusing for parents, but the science is clear: vaccines are safe, effective, and save children’s lives,” said Dr. Miranda Durham, chief medical officer for NMDOH.
All childhood vaccinations will continue to be covered under programs like Medicaid and the federal Vaccines for Children Program.
The state encourages parents to consult their healthcare providers using the American Academy of Pediatrics’ immunization schedule.
RECOMMENDED: CDC cuts childhood vaccine list, sparking healthcare professionals’ concerns
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