Legislative Finance Committee

2016 Special Legislative Session Review

Legislators during the special session, in an attempt to close the extraordinary shortfalls for FY16 and FY17, passed bills to raise hundreds of millions of dollars by closing tax loopholes, sweeping money from funds, and modifying and canceling certain capital outlay projects. They also approved legislation to cut spending for FY17 by 2.7 percent, with 5.5 percent reductions for most agencies and smaller cuts for public schools, public safety, Medicaid, certain Health Department programs, the Children, Youth and Families Department and early childhood programs in other agencies, and the Veterans Services Department. The general fund reductions could result in layoffs and furloughs for state employees.

Health Notes: Prescription Drug Costs and Maximizing State Agency Purchasing Power

The 10 New Mexico state agencies that buy prescription drugs spent a combined total of $680 million in FY16, up from $442 million in FY14. Under increasing budget pressure, New Mexico must identify ways to save money on prescription drugs.

Hearing Brief: Government Restructuring Revisited

Elimination of some agencies, consolidation of others, and a rethinking of public school district organization have all been discussed as part of restructuring studies in the past.

Early Childhood Accountability Report

New Mexico has invested heavily in early childhood and is seeing mixed results. Three out of four New Mexico third-grade students are not at grade level in reading or math, but low-income third-graders who attended prekindergarten generally outperform their low-income peers who did not attend prekindergarten. Other early childhood investments are showing similar mixed results.

FY18 Budget Guidelines

No one could foresee with any certainty the extent to which oil and gas prices and production would fall and the consequent decline in gross receipts and corporate incomes taxes in the months after the Legislature adopted the current year budget. That reality will be the priority during budget development this year.