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Taxes, Teachers and Timing

Mixed bag for governor, other Democrats as dust settles on Roundhouse session

Another 30-day legislative session concluded in Santa Fe last week with the sort of Richter scale-registering news, recriminations and mad-dash conclusions New Mexicans have come to expect from even-yeared Roundhouse extravaganzas.

House Speaker Brian Egolf, D-Santa Fe, stunned many in the chamber with his announcement that he won’t seek reelection, following several lengthy goodbyes to other departing lawmakers. Rep. Georgene Louis, an Albuquerque Democrat seen by many as an up-and-comer, sat in on debates after her arrest on suspicion of aggravated DWI and heated calls for her resignation. And Sen. William Sharer, R-Farmington, staggered through a finish-line filibuster that effectively killed a far-reaching voting rights bill favored by pretty much the entire majority party.

Sharer’s victory marked one in a series of blows to large swaths of Gov. Michelle Lujan Grisham’s pre-session agenda, which included a harsh approach to criminal justice and an ultimately ill-fated push to make New Mexico a “hub” for hydrogen energy production.

Here’s a look at how some of the bills SFR followed through the session fared. (Lujan Grisham has until March 9 to sign or veto approved bills.)

Taxes

New Mexico has one of the nation’s highest rates of child poverty, but a last-minute legislative package could alleviate some families’ financial burdens through a temporary child income tax credit that allows families to claim between $25 and $175.

House Bill 163 emerged in the final days of the session, combining several bills aimed at reforming taxation. A change to the Social Security income tax code will exempt individuals with a maximum income of $100,000, or married couples who earn less than $150,000.

The omnibus tax package also included a 0.25% reduction to the gross receipts tax. Though “if all of a sudden things go the other direction,” which means GRT revenues fall below 95% of the previous year, “there is an automatic trigger that would reinstate” the current rate, Sen. Peter Wirth, D-Santa Fe, tells SFR.

A tax credit for nurses and solar market development income, a deduction for femine hygiene products and an exemption for military retirement pay are among other elements in HB 163.

Education

It seems the only thing legislators could agree on during this year’s session was education.

Pay raises for school employees were the biggest ticket items that passed through the Legislature, totalling $267 million. All teachers will see a $10,000 pay bump, New Mexico educators will receive a 7% raise and the minimum wage for school employees was increased to $15. The biggest raise will only go to teachers; counselors, school social workers and other direct service providers won’t receive the pay increase. That is a priority for next year’s legislative session, says Rep. Debra Sariñana, D-Albuquerque, who signed on as a sponsor of Senate Bill 1.

The Opportunity Scholarship Act, Senate Bill 140, will pay the tuition of any New Mexico undergraduate enrolled in six or more credits at either a two- or four-year public post-secondary school or tribal college.

House Bill 60 increased the salary of educators holding a certification in Native American language and culture.

Cannabis

Most notable for the cannabis industry at this year’s session was the death of Senate Bill 100, which would have increased the production limit for microbusinesses from 200 to 1,000 plants, among other changes to the Cannabis Regulation Act.

“This is a big blow against us,” Bob Boylan, CEO of Roadrunner Manufacturing, tells SFR.

Boylan says the company would have upped production if the bill had passed, but adds that he thinks some microbusinesses likely wouldn’t have had the funding to take advantage of the allotted increase.

SB 100 got held up after Sen. Cliff Pirtle, R-Roswell, made an amendment to no longer require prospective cannabis producers to verify they have legal access to water, which riled the New Mexico Acequia Association.

Two other cannabis-related bills also died. One would’ve dedicated a portion of cannabis excise tax revenue to a substance use disorder treatment fund and the other would’ve made driving a vehicle while under the influence illegal. (It’s now illegal to drive while impaired due to the influence of drugs or alcohol.)

One victory at the session: The Legislature passed a bill to decriminalize the possession and use of test strips that can detect the presence of fentanyl, expanding the existing Harm Reduction Act.

Crime and Punishment

Lujan Grisham pushed a 1990s-flavored, tough-on-crime slate of bills in the runup to the session, all while facing reelection as New Mexico’s largest city suffers through record-setting violent crime spikes.

“Rebuttable presumptions” became an oft-repeated catchphrase for her signature piece of legislation, which would have rolled back cash-bail reforms and shifted the burden from the state to defendants in guiding judges’ decisions about who gets released before trial after being accused of certain violent crimes.

House Bill 5 was doomed from the start, and Democrats scrambled to reconstitute changes to the state’s pretrial detention system, ultimately agreeing that the most palatable way forward was to fund round-the-clock GPS monitoring of certain defendants.

That provision wound up in the so-called omnibus crime package, which passed both chambers and also included increased penalties for some crimes, eliminated the statute of limitations for second degree murder and created the crime of operating a chop-shop.

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