Gov. Michelle Lujan Grisham has until March 11 to sign or veto bills adopted during the 30-day legislative session that wrapped last week, but she's already indicated support for many the of measures that landed on her desk.
When it comes to some items, such as the capital spending plan, she's got line-item power to delete projects from this list, but most bills—including the big-ticket budget for the state—require wholesale approval or veto.
SFR doesn't want to leave readers hanging. Here's a roundup of bills we followed during the session and how they fared:
Champions of a bill that will allow businesses to incorporate in New Mexico as benefit corporations finally saw their work pay off this session. The Legislature passed House Bill 118, which creates a new section of the Business Corporation Act. Advocates say this will help both attract new businesses and retain others. "I think it will mean that we will see new businesses incorporated here in New Mexico to take advantage of the status," sponsor state Rep. Zachary Cook, R-Ruidoso, told SFR upon the bill's passage. "And I hope to see, of course, more investment in our state from outside businesses and investors as well as job growth and innovation."
As SFR previously reported, only 13 states had embraced the concept of benefit corporations when Cook first introduced the bill in 2013. Today, more than 35 of them, along with Washington, DC, have passed legislation allowing for the designation.
The state's Economic Development Department also heralded the passage of other laws geared at strengthening the state's business environment. These include Senate Bill 136, which raises the 9% cap on State Investment Council investments from the Severance Tax Permanent Fund to 11%, which EDD says will allow the council to deliver approximately $200 million of new investments into New Mexico companies and start-ups.
Mixed Bag for Retirement
A variety of legislation was on deck this session aimed at helping retirees. One measure, House Bill 44, the New Mexico Work and Save Act, would create a voluntary program for workers who want automatic deductions into Individual Retirement Accounts. Think New Mexico Executive Director Fred Nathan, whose organization lobbied for the bill, previously told SFR the bill is "targeted to those private sector employees whose employers don't provide that, and that's about 60% of private sector employees in New Mexico." Its passage, Nathan said, would help stem the retirement crisis Think New Mexico documented in a recent report. The bill passed the Legislature and awaits the governor's signature. Think New Mexico is asking voters to encourage the governor to sign the bill.
Senate Bill 72 also made it through. Sponsored by Sen. George Muñoz, D-Gallup, the bill addresses the New Mexico Public Employees Retirement Association's $6.6 billion unfunded liability. Among other elements, the bill requires a 2.5% cost-of-living adjustment—up from 2%—for retirees over the age of 75 as of July 1, 2020, and continues the current 2% cost-of-living adjustment for other retirees for three years. Thereafter, COLAs will be based on a new "profit-share" model aligned with investment performance.
Senate Bill 201, however, which would reform the PERA Pension Oversight Board, never received a hearing. Among other things, the bill would have required board members to have some type of professional financial experience.
Santa Fe firefighters who work in the field and lose retirement dollars because of the way their shifts are scheduled and reported to PERA also missed out on a fix.
Senate Bill 62, the Public Employee Retirement Pay Changes Act, would have changed the legal definition of "salary" to include overtime hours for positions in which that time is part of regularly scheduled tours of duty. The bill passed the Senate and the House Labor, Veterans' and Military Affairs Committee during the final days of the session, but did not earn a House floor vote before time ran out.
As for the prospect of eliminating state tax on Social Security, no dice this time around. Six different bills were introduced to this end. House Bills 29 and 77 passed their first committee hearings but died after that. The Senate bills never came up, according to a Think New Mexico round-up.
The Public Regulation Commission has been a controversial body for its entire existence, and this year was no different. In fact, the commission has been so notoriously problematic that lawmakers agreed last year to let voters decide if it should be an appointed versus an elected body. A constitutional amendment to that end will be on November's ballot.
"The current system is not working," ballot measure co-sponsor Sen. Peter Wirth, D-Santa Fe, told SFR prior to the session. Noting the technical expertise needed to understand regulatory cases, Wirth said such a move might help "to get the politics out of the PRC."
But House Bill 11, which would have reorganized the PRC and transferred most of its duties to other agencies, stalled out in the Senate Corporations & Transportation Committee. The bill, co-sponsored by Reps. Nathan Small, D-Las Cruces and Linda Trujillo, D-Santa Fe, was supported by the governor, who has clashed legally with the PRC over implementation of the Energy Transition Act.
Probation and Parole Reform
While the governor and her allies managed a last-minute effort to push through a so-called crime package that included modest penalty increases for certain gun-related crimes and more money for "community policing," this year's highest profile criminal justice reform proposal died quietly in the Senate Judiciary Committee.
A measure that would have decreased the number of people on probation and parole who are returned to jail or prison for "technical violations"—a failed initial drug test, arriving late to or missing an appointment with a probation officer—had been a priority for Lujan Grisham and legislative Democrats starting in the 2019 session. Both chambers passed the bill last year with bipartisan support. But the state's prosecutors, including Attorney General Hector Balderas and First Judicial District Attorney Marco Serna, sent the governor a letter after the session urging her to veto it. She did, reluctantly, and asked lawmakers to work out their differences with the prosecutors during the interim.
Legislative sponsors, led by Rep. Antonio "Moe" Maestas, D-Albuquerque, believed they'd done so when they introduced House Bill 263 for the 2020 session, largely on the strength of giving the prosecutors most of what they wanted by way of concessions. But by the time it reached the House Judiciary Committee, it was clear that fault lines remained. Prosecutors wanted a stricter definition of who should be tossed back behind bars for minor violations; defense lawyers and civil rights advocates thought the bill already could mark a step backward for shifting probation and parole's focus from punishment to compassion.
Still, the bill passed the committee, then the full House on a 47-17 vote. With less than a week to go in the session, the measure never got a hearing on the Senate side. But stay tuned: Technical violations cost taxpayers more than $40 million a year in incarceration costs, according to a 2018 Legislative Finance Committee analysis, so this issue is likely to stick around till it gets resolved.
Paying the Courts
Amidst a spending spree by the Legislature and executive office, dust is settling at the end of the session around a funding bump for the third branch of government.
The final judiciary budget approved by the Legislature includes an increase of more than 4% for court operations in the fiscal year that begins July 1. That money would fund expansion such as five new judgeships (one in Santa Fe), more money for pretrial services and increases in security.
Arthur Pepin, director of the Administrative Office of the Courts, told SFR judicial leaders are pleased with the session’s outcome and that lawmakers understood the court’s priorities. Yet, there’s an area where New Mexico still has catching up to do: judges’ salaries.
Separate from the operating cash, lawmakers planned for a 7% pay increase for judges. That’s a compromise added by the Senate after the House first recommended a 6% hike, but it’s not quite the 8% raise recommended by an independent panel.
Judicial salaries in the state continued to be among the lowest in the nation going into the session. For four years between 2010 and 2013, judges saw no salary increases, then another zero-increase period between 2016 and 2018.
House Bill 9, the Community Solar Act, started off as one of the most highly anticipated solar bills of the session, but it failed to gain momentum and died on the House floor 36-28. The bill would have made solar power accessible to people who rent their homes or can't afford to buy their own systems by allowing individuals to subscribe to remote community solar installations.
Last year, legislators voted along party lines against a similar bill. After all the other strides the state made toward a renewable energy transition in the 2019 legislative session, advocates for community solar expected a favorable environment for pushing it forward this year. Yet, a total of 13 House Democrats voted against the measure due to concerns about how community solar could impact ratepayers and utilities. As the bill was written, rules for community solar would depend on the Public Regulation Commission. However, the uncertainty about that regulatory body's future acted as a dampener. The companion community solar bill in the Senate failed to make it to committee.
A bill reinstating a solar tax credit that Lujan Grisham listed in her legislative priorities successfully passed the House and the Senate. Senate Bill 29 will allow people who put up solar panels to receive a tax credit of no more than $6,000 or 10% of the costs of the solar panels themselves as well as the costs of installation. The governor supports the bill.
Curbing Youth Tobacco Use
Following recent federal legislation, New Mexico raised its minimum age to buy tobacco to 21 with Senate Bill 131, which created the Tobacco Products Act. The measure created a way for the government to license tobacco retailers to better enforce the new minimum buying age and punish those who don't follow the rules. Consequences include losing licensure to sell tobacco, as well as fines and fees.
Backers said the main goal of the bill is an effort to curb youth vaping and tobacco use, which are on the rise. The most recent Youth Risk and Resiliency Survey showed up to one-third of students in middle school use vapes or e-cigs, compared to 25% in prior years. The new rules and regulations will go into effect on July 1, 2021.
No More NDAs
Nondisclosure agreements in workplace sexual harassment and assault cases would no longer be used to silence victims in New Mexico if the governor signs House Bill 21. NDAs in settlement agreements have long been a way for predators to continue their behavior while silencing victims.
Rep. Dayan Hochman-Vigil, D-Albuquerque, partnered with other lawyers and the University of New Mexico's law school to craft the bill to make sure employees can't force someone to sign an NDA as a condition of employment or in a settlement. A nondisclosure clause could only be included if the plaintiff agrees to it. The law would only apply to agreements reached on or after May 20, 2020.
Senate Bill 118 creates aLocal Economic Development Support Fund within the Economic Development Department targeting rural communities. These can include traditional LEDA (Local Economic Development Act) projects that create economic base jobs; retail projects in communities of less than 15,000 people; and rural site infrastructure to create "shovel ready sites" for competitive business development, according to an EDD news release.
(Journalists Julia Goldberg, Jeff Proctor, Leah Cantor, Katherine Lewin and Julie Ann Grimm contributed to this report. SFR's legislative reporting this session was supported in part by New Mexico Local News Fund.)