Gov. Michelle Lujan Grisham tours a school Monday in Los Alamos. 

Gov. Michelle Lujan Grisham used her executive powers Friday to line-item veto over $1 billion in one-time expenditures for fiscal year 2022 that would have been covered by expected federal pandemic aid from the American Rescue Plan.

Tripp Stelnicki, a spokesman for the governor, said, “The money is still there. We still have it, but we can’t appropriate it until we get guidance from the federal government. As soon as we get guidance, we’ll get it out the door.”

The veto did not affect the $7.4 billion budget for fiscal year 2022, which was approved by the Legislature and signed Friday by Lujan Grisham.

Still, agencies and programs anticipating the federal dollars to fill gaps — Medicaid ($50 million), road projects ($200 million) and the state’s Legislative Lottery Scholarship ($100 million) — will have to wait for allocations.

Another $600 million in federal aid was earmarked for the state’s unemployment insurance fund, which has been relying mostly on federal loans since September to remain solvent.

With over 100,000 New Mexicans receiving unemployment benefits, the debt has added up to about $235 million.

Stelnicki said Lujan Grisham is “fully committed to fully restoring” the unemployment insurance fund. To start with, he said, Senate Bill 377, which the governor signed, includes $300 million for the fund.

The state has ample time to allocate money from the American Recovery Plan. The deadline is the end of 2024.

What remains in question is which branch of government ultimately will control those funds — the executive or the Legislature?

Stelnicki said the governor can appropriate the money as soon as she receives federal guidance.

Sen. Pat Woods, R-Broadview — one of two Republican senators who voted in support of the budget bill on the Senate floor — laughed when he heard the governor had vetoed the federal money.

“Isn’t that something?” Woods said by phone Friday evening. “We were trying our best to keep that legislative power in the budget so we would have a say-so in how that federal money is being spent.

“When is it the Legislature’s power to appropriate money for the state? I imagine that battle is yet to come a little harder,” he added.

Democratic state Rep. Patty Lundstrom of Gallup, chairwoman of the House Appropriations and Finance Committee, said the Legislature could appropriate those funds during the 2022 legislative session.

If Lujan Grisham does decide to appropriate some of the federal money before the next regular session, Lundstrom said, “I will be very interested to see what uses she will put that federal money toward that we did not already talk about.”

Lujan Grisham called the state budget for the next fiscal year a “solid and sustainable” spending plan that allows New Mexico’s reserves to remain at robust levels.

The budget increases spending over the current fiscal year budget by 5 percent, with $3.3 billion dedicated to the public school system. That’s about 45 percent of the overall budget, and it includes a $183 million increase in per-student funding for schools.

The budget funds 1.5 percent raises for state employees, including public school and college personnel.

It also has $300 million for road improvements, $30.7 million to support mental health and substance abuse initiatives through the state Human Services Department, and $12 million in new spending for college tuition programs.

“This budget is responsible and responsive to the needs of New Mexicans right now and in the future,” the governor said in a news release issued by her office.

“This legislative season has been a remarkable success for New Mexicans in every corner of our state,” Lujan Grisham said, noting there is nearly $1 billion in funding for pandemic relief for businesses and workers. She also lauded initiatives in economic development, health care and environmental protection.

Lujan Grisham also signed House Bill 285 on Friday, allocating $511 million in capital outlay for projects across the state. The bill includes $12.5 million for Local Economic Development Act projects, $52 million for tribes, $49 million for higher education and almost $48 million for public safety needs.

Friday was the deadline for Lujan Grisham to sign legislation approved during the regular session, which ended March 20. The Democratic governor signed the vast majority of the nearly 160 bills that came to her desk from an overwhelmingly Democratic Legislature.

She did, however, veto a few bills:

  • House Bill 25 would have required the Legislative Education Study Committee, which focuses on the public education system, to begin studying the higher education system as well. The governor said it’s not a good use of the committee’s time.
  • House Bill 92 would have increased fees for public water systems. The governor wrote in her veto message it would be an “onerous” increase on New Mexicans struggling to survive the coronavirus pandemic.
  • House Bill 103 would have increased fees in the Utility Operator Certificate Act. The governor said those operators provide “vital services” and should not have to pay more in fees for tests and reviews.
  • House Bill 196 would have removed the state Mortgage Finance Authority from its role overseeing regional housing matters. The governor said the agency is “best positioned” to do that job.
  • House Bill 240 would have amended the guidelines of the Hospital Fund Act and allowed tax revenue generated from mill levies to be used for emergency health care facilities in qualifying counties. The governor said only Valencia County would qualify and that the fund was not set up for that purpose.
  • House Bill 287 would have required the social services division of the Public Schools Task Force to conduct an analysis to find gaps in social services in public schools. The governor said the Public Education Department can do the work.
  • Senate Bill 131 would have altered the way the state distributes funds for public school improvements. The governor said the legislation had “substantial issues.”
  • Senate Bill 242 would have made changes to the Citizens Substitute Care Review Act, which affects the monitoring of children in state custody. The governor said the bill had no appropriation and the sponsors had not consulted with Native American communities for guidance.
  • Senate Bill 285 would have limited the authority of emergency medical responders to transport a patient for an emergency mental health evaluation without a court order. The governor said the language of the bill would limit responders more than the measure intended.
  • Senate Bill 328 would have repealed the six-year limitation on water and sanitation gross receipts tax, allowing it to go on. The governor said the voter-approved measures should be left in the hands of voters.
  • Senate Bill 341 would have removed the Public Education Department’s right to distribute grants from the community school fund unless authorized by the Legislature. The governor said that added “unnecessary limits” on the initiative.
  • Senate Bill 375 would have changed the makeup of the New Mexico Law Enforcement Academy Board by eliminating several members, including two citizen members. The governor said the board needs the citizen oversight.

General Assignment Reporter

Robert Nott has covered education and youth issues for the Santa Fe New Mexican. He is assigned to The New Mexican's city desk where he covers a general assignment beat.

(10) comments

George Welland


The SFNM reports, "Another $600 million in federal aid was earmarked for the state’s unemployment insurance fund, which has been relying mostly on federal loans since September to remain solvent." And the SFNM also clarified that the governor's office is waiting for federal guidance before appropriating the funds (but failed to mention such federal relief would be hijacked from its original purpose of benefiting the unemployed and getting her unemployment office to function).

The reality is that unemployment funds always go broke during recessions and are restored in the next growth cycle (and always get low interest or debt forgiven federal loans); but relieving employers from paying their fair share by taking funds meant for the unemployed was a bad idea: and it's too bad the governor's office is only opposed to this misappropriation of funds because the feds may forbid it!

It's a small, and probably temporary, victory for fiscally responsible government and for all the wrong reasons.

Chris Mechels

SB375 certainly deserved a veto, as it was a mess which became a Christmas tree.

That said, the reason given for the veto is false. The two citizen board members are carefully "vetted", by the DPS, to make sure they are "safe" for the interests of the DPS. The Attorney General is part of this scheme. "Real" independent board members are needed, but until the Governor insists, that is not likely. She just doesn't care about the LEAB, or police issues in general.

Lee DiFiore

Governor tyrant does not want anyone impinging on what she sees as her power, including the dully elected legislature. If you don't believe me, answer this; what comes after turquoise?

John Cook

After turquoise comes New Mexicans returning to completely normal without regulations. With a crowning success in combating the virus. The Governor has done a good job in a very difficult situation balancing saving lives with saving the economy.

Lee DiFiore

Please provide a link to the "after turquoise" plan. And perhaps a time frame or benchmark when that might occur.

Mike Johnson

I would be willing to bet MLG will still be exercising her dictatorial powers under the emergency health act next year at this time, and probably until she is defeated and removed from office, hopefully.

John Cook

Anyone who bets on your constant, angry fantasies, Dr. Johnson, would be better off buying lottery tickets.

Jim Klukkert

Why should anyone believe a crybaby complainer like Lee DiFiorie, whose constant carping never is mixed with substance nor accompanied by attribution.

zach miller

finally a good use of tax payer dollars that isn't sending billions of dollars to a fossil fuel CEO's bank account.

Michael Kiley


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