Governor Lujan Grisham s $10.8 Billion Budget Proposal for New Mexico: A Boost for Health and Education

New Mexico legislators have proposed a 5.7% increase in general fund spending for the fiscal year 2025-2026, totaling $10.8 billion.

This increase focuses on improving health care access, public education, and early childhood programs aimed at easing household finances. With significant income from petroleum production, the state is aiming to bolster services while addressing challenges like crime and homelessness.

Key aspects of the proposal include:

  • A $577 million increase in general fund spending.
  • A $3.3 billion, 27% increase in health care spending, primarily for Medicaid, funded in part by a new hospital assessment.
  • A 6% increase in K-12 public education spending, including a $263 million boost and $150 million allocated to pilot programs for literacy, math, and attendance improvements.
  • A nearly 9% increase in funding for early childhood education and childcare, totaling $854 million.
  • A proposal to create a $1 billion endowment for mental health and addiction services.

The plan also includes a 4% pay increase for state employees and no immediate tax cuts, though Republicans are advocating for eliminating personal income taxes for top earners.

Governor Michelle Lujan Grisham is pushing for a slightly higher spending increase, and she retains the power to veto parts of the budget.

 

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