[LWVNM Action] Early childhood fund a solution fortoday and a plan for tomorrow

[Richard Mason]

*Early childhood fund a solution for today and a plan for tomorrow*

*By Peter Frank / Vice-chair, State Investment Council
<https://www.abqjournal.com/author/abqnews>*

*Sunday, December 29th, 2019 at 12:02am – ABQ Journal*

You might not know it but, 60 years ago, some visionary leaders in our
state gave you – and every other citizen in New Mexico – an incredible gift.

It was 1959 and New Mexico wasn’t even five decades old. But we had already
managed to grow a $150 million “nest egg” from revenues generated on state
trust lands we received for entering the Union. Faced with the dilemma of
whether New Mexico should save, spend or invest state trust land dollars,
policymakers chose an “all of the above” approach and wisely established
the State Investment Council (SIC). Today, the SIC invests that New Mexico
nest egg – the Land Grant Permanent Fund – which has now grown to more than
$18 billion in value.

Those billions aren’t just sitting there locked in a vault – they’re
creating income and working for you every day, generating revenue that
stabilizes state budgets even in lean years. The Land Grant Permanent Fund
and its sister-endowment, the Severance Tax Permanent Fund, will deliver
more than $1 billion for New Mexico public schools, universities, hospitals
and government services this year. That’s more than $84 million in benefits
and tax savings to New Mexicans every month, the equivalent of $1,300 per
household and almost $500 for every man woman and child in the state,
annually. Together, these two funds constitute the third-largest legacy
fund in the country.

When oil and gas prices crashed in 2016 and legislators were forced to
slash budgets to the bare bone, revenue from the permanent funds was not
only stable, but also the state’s lone source of rising cash flows and new
money for our budget.

The stability such funds can provide is one reason states like North Dakota
– flush with cash from its own recent oil boom – have looked to New Mexico
as an example when dedicating billions to create their own new permanent
“legacy” fund. New Mexico’s permanent funds provide both security today and
opportunities for the future.

Gov. Michelle Lujan Grisham, who created New Mexico’s first Cabinet-level
department focused on early childhood education and care, has proposed
establishing a new permanent fund for the same purpose.

It makes sense. With a successful model already in place and the funds
available, why wouldn’t we double down on proven strategies? A new
permanent fund dedicated to early childhood needs would establish a stable
and recurring revenue resource for programs to help children succeed,
starting at day one. This fund would improve the outcomes generated by our
existing educational funding, make sure our kids are prepared to learn by
the time they reach kindergarten, and set the table for their success
throughout life.

New Mexico’s fiscal outlook has, thankfully, improved dramatically. But we
also know that nothing – perhaps with the exception of permanent funds – is
permanent. With oil and gas revenues to the state booming, there is a
growing call to do what’s right not only for today, but also with an eye to
the future.

A new endowment focused on early childhood education would expand our
successful blueprint to create a new revenue engine dedicated to helping
drive future generations of kids into successful, educated adulthood.

As we appear to be at yet another of history’s crossroads, why not provide
our future generations with a tool, a resource – a gift – so that through
hard work and education, our children, grandchildren and generations beyond
will have the best opportunities to succeed, no matter what the future may
bring?

*This op-ed was also signed by SIC council members Land Commissioner
Stephanie Garcia Richard, DFA Secretary Olivia Padilla-Jackson, Harold
Lavender, Linda Eitzen, L. Michael Messina and Tracy Hartzler. *
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