[LWVNM Action] Fwd: NM Fairness Project update - State Finances

[Richard Mason]

 The LWVNM is a member of the Fairness Project.

Dick Mason
 
 


NM FairnessProject members,We hope youare healthy and keeping your distance! Like most of you, we’re working from home these days but busier thanever.While thedaily deluge of news around the COVID-19 pandemic is rarely good, early actionby Governor Michelle Lujan Grisham means New Mexico is actually better preparedfor the pandemic than many states. We are also slightly better prepared for therecession that is sure to follow (you can read more about that here).It’s looking like a special session of the Legislature will be necessary toaddress the loss of revenue from dropping oil and gas prices, and we hope you’lljoin us there (either in person or remotely) to make sure the needs of NewMexico’s kids, families, and communities are front and center.Here’s some of what‘s keeping us busy:·      We are currently working on fact sheets aboutthe two aid packages recently passed by Congress and what that will mean forNew Mexico. Stay tuned.·      Find our blog on state policy recommendations tohelp families impacted by the economic changes here.·      Find our blog on how the safety net can beimproved during this crisis here.Coming soon: a blog on fiscal steps the stateshould take to help manage the ongoing crises. We’re also prepping for a likely special session in mid tolate June. We are grateful for the high level of reserves but still deeplyconcerned that harmful budget cuts could be enacted. While there’s no doubtthat the state budget needs to be adjusted (some increases and some cuts), thisis no time for New Mexico to retreat on the gains that were made in 2019 and2020. The austerity of the great recession drove us to last in education, childwell-being and even in job growth. We can’t repeat the failed strategy of that“lost decade.”Like many of you, we’re working with our congressionaldelegation to encourage more aid for state and local government budgets, anincrease in the Medicaid match rate, support for education, infrastructure,unemployment insurance, aid to small businesses and much more. We are hopingthat with significant federal aid and our substantial reserves, New Mexico canweather this fiscal storm without damaging cuts.Here is some of what we know about the federal fiscal relief thatis coming directly to the state of NM:·      The Families First Act (C-2) boosted thefederal matching rate for Medicaid and will increase federal dollars to NM byabout $250M. There is a push by Governors and many in Congress to increase thefederal match even more.·      The CARES Act (C-3) provided $1.25B in aid tothe state for COVID19 related expenses and about $182M of that will go toBernalillo County and the city of Albuquerque. It is not yet clear if thosefunds can be used to backfill the state revenue lost because of the economicshutdown related to the pandemic. Governors are pushing hard for the TreasuryDepartment to interpret the law broadly to help the states.·       TheCARES Act (C-3) provided $209M to the state for education. Of that, $107.7M is for K12, $79.4M for higher educationand $22.5M for the governor’s emergency education relief fund.
FamiliesFirst and the CARES Act also include individual rebates, unemployment insuranceincreases, and some housing, food security, and health care benefits, howevermuch more still needs to be done. We’ll soon be releasing a report about whathas been included in the packages, what and who have been left out of benefits,and the gaps that policy makers still need to fill in order to ensure all NewMexico families can survive and thrive beyond these crises. We are also well aware of those who have been left out of thefederal aid packages. We’ve been raising our voice and working with allies inthe immigrant community to identify ways to support immigrant families in fourcritical areas – food insecurity, housing, unemployment insurance and healthcare.  In these difficult times, increased state revenue can also be apart of the solution. One of the initiatives that we hope might be promoted inthe special session is replacing a federal health insurance premium taxthat ends in December 2020 with a state premium tax. Enacting the legislationin the special session would allow the overall premium tax to remain the same,but would increase state revenues by about $120M/yr. At a time when the stateneeds an influx of health care dollars, an initiative such as this seems timelyand justifiable. We’re also looking at other possible revenue changes and hopeyou will share your ideas and priorities with us. Please keep in touch!Wishing you all good fiscal and physical health!Bill JordanNM Voices for Children505-350-3097 cell
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