Lawmakers faced with dueling budgets for NM environment agencies

Advocates fear the state will be shortchanged on industrial regulation while facing drought and climate crisis

By: - January 18, 2022 6:00 am
Cracks in a riverbed where there should be water

A riverbed where there should be water. Climate change is drying up water sources in the Southwest. (Photo by Marisa Demarco / Source NM)

Initial budget proposals from the executive and legislative branches offer a view of the fault line to funding climate priorities at the top of the 30-day legislative session. 

Conservation advocates said they’re worried state agencies that regulate polluters and monitor the state’s air and water will be underfunded by lawmakers in the 2022 legislative session which opens today. 

Underfunding means fewer protections for the environment, said Ben Shelton, the political and policy director at environmental group Conservation Voters New Mexico. 

“Operating budgets for the natural resource regulators are really, really important, because that’s where all the enforcement is,” Shelton said. “When you cut out their operating budgets, you just reduce the effectiveness of all the protections we already have on the books.” 

Agency-wide vacancy rates

NMED: 23.6%

EMNRD: 18.2%

Climate scientists around the world continue to call for governments to dramatically reduce oil and gas reliance to curb the warming that causes more deadly storms, changes weather patterns and intensifies water scarcity. 

The stakes couldn’t be higher for New Mexico. State and school budgets live or die by the boom-bust nature of oil and gas money. But people and fragile ecosystems face increasing strains on water and destructive wildfires from hotter temperatures. 

Oil and gas demand surged across the country in 2021, buoying New Mexico’s budget with an unprecedented estimate of $9 billion in revenue and $1.6 billion more cash than last year. A $10.5 billion influx of federal funds poured into the state for pandemic relief, with more money expected from the national infrastructure bill passed in November. 

Gov. Michelle Lujan Grisham unveiled a $8.45 billion budget, a 13% increase over last year, prioritizing education spending, bolstering police departments and infrastructure. 

The governor’s environmental priorities included a 16% budget increase for the Energy Minerals and Natural Resources Department (EMNRD) for a total $81.3 million, including $1.5 million to hire 20 additional inspectors to monitor the oil and gas industry.

The Environment Department (NMED) budget would increase by 4% to $146 million and would receive $2.5 million to create a Climate Change Bureau inside NMED to create and enforce new climate change policies.

The Environment Department (NMED) budget would increase by 4% to $23 million and would receive $2.5 million to create a Climate Change Bureau inside NMED to create and enforce new climate change policies. 

Additionally, Lujan Grisham proposed $29 million for the Office of the State Engineer — a 4% increase — to work on drought, dam safety and the implement a 50-year water plan for the state. 

The Legislative Finance Committee (LFC), a nonpartisan agency that advises budget policy, put out a recommendation Monday that  environmental lobbyists said puts climate on the back burner. 

“The governor advanced what we felt was a modest, but very reasonable budget, in terms of really putting some money into the climate change debate,” said Ben Shelton, the political and policy director at environmental group Conservation Voters New Mexico. “The (Legislative Finance Committee) just apparently does not prioritize it at all, which is a problem.” 

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The LFC’s priority is dedicating $496 million, more than half of the recommendation, to replacing federal funding — such as the higher Medicaid match rate ending in April, according to a letter from Chair Rep. Patty Lundstrom (D-Gallup). 

“Most of the proposed increases do not grow agencies’ overall budgets and instead replace the use of one-time funding for ongoing expenses used to keep the state solvent,” the LFC budget report said. 

The governor’s proposal recommended that more of the agencies’ budgets pull from the General Fund, the state’s cash pool funded by tax revenues, which can be renewed in future years, unlike some state and federal grants or other funding sources.

LFC proposes giving EMNRD $26 million out of the General Fund, which is $5.2 million less than the executive budget recommendation. NMED would lose out on $6.7 million from the General Fund if the LFC recommendation is adopted, a total budget of $17 million. Finally, the state engineer’s office would see $4.4 million less with an LFC General Fund recommendation of about $24.7 million.

Gov. Michelle Lujan Grisham’s ask from the general fund:

ENMRD $31.2 million

NMED $23 million

Engineer’s Office $29.2 million

The LFC’s general fund proposal

ENMRD $26 million ($5.2 million less)

NMED $17 million ($6 million less)

Engineer’s Office $24.7 million ($4.4 million less)

Brittany Fallon, a policy director for nonprofit New Mexico Wild, said the LFC’s small increases fail to undo the cuts of 20% to the agencies under the Martinez administration. Lujan Grisham’s budget provides the staff to overcome years of chronic cuts, she said, which she hopes will make the agencies more effective. 

“They have to have the staff, the operating budget and the program support so that agencies can actually spend that money,” Fallon said. “That’s the piece that the executive budget has that the LFC budget is lacking.”

Fallon said the state is leaving money on the table. 

“Without appropriate funding for the environmental agencies, New Mexico is going to continue to lose out on tens of millions of dollars in federal funding,” she said. “Whether that’s us not being able to have the matching dollars or not having the staff to apply for and vet those matching dollars.”

Agency leaders said they need more financial support. Cabinet Secretary James Kenney, told Reporter Jerry Redfern for Capital & Main that the department did not have the resources to hold industry accountable. John Rhoderick, a NMED division director, told SourceNM that additional funding would help the department compete with the private sector for qualified employees. 

The lawmakers’ initial budget is short-sighted, Shelton with Conservation Voters New Mexico said. 

“If we’re not making the sort of capital investments in the environment or environmental regulators, are we ever going to be? When are we ever going to get serious about dealing with all these myriad impacts of climate change?” he asked.  


This story was updated on Friday, Jan. 21, to correctly reflect the difference between total budgets and amounts slated to come only from the General Fund. We apologize for the error.

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Danielle Prokop
Danielle Prokop

Danielle Prokop covers the environment and local government in Southern New Mexico for Source NM. Her coverage has delved into climate crisis on the Rio Grande, water litigation and health impacts from pollution. She is based in Las Cruces, New Mexico.