SANTA FE — New Mexico legislators have voted by a wide margin to pass a $330 million coronavirus relief bill that will send checks directly to out-of-work residents next month, provide grants to small businesses and increase funding for food banks and COVID-19 testing, but ignored calls to send money to hard-hit essential and front-line workers.
The largest appropriation of $194 will go directly to unemployed workers in the form of a one-time $1,200 check next month. An additional $5 million will be distributed to residents who missed a federal stimulus check of the same amount, including dependents and immigrants in the country without legal permission.
Lawmakers say $319 million of the relief spending is unspent money from the federal virus relief passed by Congress and signed by President Donald Trump in March. The money was required to be returned if it wasn’t spent by the end of the year.
An additional $10 million was allocated to coronavirus testing and contact tracing. That money will come from the general fund because it has to be spent well into 2021.
In the Senate, the measure was approved 33-5 with four state senators abstaining. Sen. Gregg Fulfer, R-Jal, voted for the measure. While he didn’t like a lot of the structure of the bill, he said the money would go to the workers in need.
“I would like to have seen a bill where all that money went into unemployment,” Fulfer said. “Because in 2021 all the businesses, their unemployment insurance taxes will double. It was capped for 2021, and in 2022 it will double again. That would be just punting it down the road where the employers get hit with a huge tax that will put all of them in a disadvantage with out of state businesses.”
Sen. Gay Kernan, R-Hobbs, did not vote for the measure. She said that while she was comfortable with some portions of the bill, distribution of the funds was not one of them.
“I was concerned with lack of information on how money is to be distributed,” Kernan said. “It was a long day, but I voted no on the bill and there weren’t many of us who did. The only part of the bill was the unemployment piece because the rest of it is going to be directed by the executive (Gov. Michelle Lujan Grisham), and businesses are going to be selected by the executive that get help. I just think there were just too many uncertainties on how the funding was going to be distributed. People do need unemployment funds, but I think they are going to have a hard time getting money out before the holidays.”
“All or at least half of the $330 million should have went into the unemployment fund to shore it back up,” Fulfer said in a Facebook post. “What is going to happen, and has already happened, is the State is raising the tax on the unemployment on businesses to try to make up the difference. So businesses, that are already suffering their taxes, are doubling to make up for the difference. This is going to put a huge burden on N.M. businesses making out of state businesses more competitive than N.M. businesses and an incentive for N.M. businesses to cut employees.”
On the House side, Rep. David Gallegos, R-Eunice and Rep. Larry Scott, R-Hobbs, both said they voted no on the measure and said their days were equally as long. The measure passed 59-11.
“It was a horrid day,” Gallegos said. “If you look at it, during the last session (the Democrats) got everything they wanted and then they couldn’t afford to keep going the way they were going. They needed to call us in. The only good thing out of this, is I hope (Lujan Grisham) continues to call in the Legislature whenever she needs more money, because it gives us a chance to at least voice the opinion on where it goes. And we have been asking for that since day one.”
SCOTT SAID HE STRUGGLED with trying to balance what he knows would be a good Christmas present for people in the district against the fiscal implications on the state.
“I finally came down on prudent fiscal management,” Scott said. “I thought we had gotten a $10 million provision in the bill to assist with COVID-related activities. I felt like testing and timely test evaluations and contract tracing is the only way to get this virus under control and I found out when I got here that there is $10 million, all allocated to the Department of the Health, but none of it is for COVID-related activities until you get to the distribution of a vaccine. And that lack of any provision for reducing the lines, getting tests evaluated quicker and getting contact tracing underway quicker is what pushed me over the edge to the negative.”
The bill also provides smaller stimulus checks to immigrants without legal status in the country and dependents, as well as additional funds for food banks, virus testing and contact tracing efforts.
Gov. Michelle Lujan Grisham called for the one-day special session as the state faces its steepest death and infection rates, and as around $319 million in unspent federal coronavirus aid relief was expected to expire.
It also follows months of additional anticipated money from the federal government that has not arrived.
“The president’s commitment to undermining basic public health guidance and to politicizing commonsense safeguards we all can take up to protect one another and our communities have hamstrung the states that are forced, through his inaction, to take up the mantle of leadership amid these crises,” Lujan Grisham said. “Nevertheless, I had held out hope that his administration and Congress would deliver another stimulus package. Many New Mexicans had hoped the same.”
With Democrats holding large majorities in both houses, the roughly $330 million relief bill was expected to pass during the special session of the Legislature Tuesday. But support from top GOP lawmakers signaled that it could pass quickly.
“This is a much better bill,” said House Republican Minority Whip James Townsend. “I have appreciated the changes that have been incorporated into the last draft. I think they met directly some of the concerns that I had.”
THE BILL ALLOCATES $100 million to support businesses with 100 or fewer employees. The New Mexico Finance Authority is tasked with distributing the grants, which can be up to $50,000, and has wide discretion about whom to choose. It’s instructed to focus on the service industry.
Republican lawmakers welcomed language in the bill that instructs the Finance Authority to make sure recipients are spread out geographically, and not concentrated in the tourism and Democrat-heavy cities of northern New Mexico.
Outside the state Capitol, two dozen people gathered in opposition to the relief bill, and the health orders from the governor that have closed many businesses and mandated mask wearing. One brought a sign that said “my body, my face, my choice.”
The building is normally open to the public and buzzing with lobbyists during a legislative session but has been closed since the onset of the pandemic.
New Mexico finds itself with 130,000 people still on the unemployment rolls, the vast majority of schools closed to in-person learning, and a high unemployment rate as the global recession tamps down demand for work in oil fields and as the virus has hit the state’s other largest industry — tourism.
The $1,200 in relief checks would go also to the 1,515 people who have exhausted all of their state and federal unemployment benefits, according to the Department of Workforce Solutions. The checks comprised the largest portion of the budget, coming in at $194 million.
The statewide unemployment rate was 8.1% in October, well above the 6.9% national rate. New Mexico depleted its unemployment insurance fund in September and has begun borrowing money from the federal government to fulfill claims.
The state already owes the federal government $124 million, and that number is expected to grow to $400-500 million by next summer. Tuesday’s bill would divert any leftover federal coronavirus relief from the spring to pay down that unemployment debt.
That looming financial disaster weighs heavily on the Department of Workforce Solutions secretary, who says he gets constant phone calls, emails and pleas on social media.
“I hear all the stories, all the stories about how am I going to take care of my kids? How am I gonna afford my rent? How am I gonna afford my truck payment?” said Bill McCamley, a former state legislator who advised on the bill.
The Associated Press contributed to this story.