LAS CRUCES - Legislation to increase the annual distribution from the state’s Land Grant Permanent Fund passed 44-25 in the House of Representatives during this year’s session. It was then amended by the Senate Rules Committee before stalling in the Senate Finance Committee.
House Joint Resolution 1 was introduced by Reps. Moe Maestas and Javier Martinez, both Democrats from Albuquerque.
Here are some key points from the fiscal impact report on that legislation:
• The original proposal called for an increase in the annual distribution from 5 percent to 6 percent. That was reduced to 5.5 percent in the Senate Rules Committee.
• The 0.5 percent increase would have delivered an additional $90 million in fiscal year 2022. Of that, $77 million would have gone to early childhood programs, the other $13 million would be split between the 20 other beneficiaries.
• An analysis by legislative staff showed the market value of the fund was expected to increase each year, even with the additional 0.5 percent distribution. The value of the fund this fiscal year was listed at almost $23.5 billion. If the legislation had passed, the fund was still expected to grow to $70.4 billion by FY 2048. But, the increased distribution was expected to decrease the value of the fund by $1.5 billion in 10 years and by nearly $8 billion in 30 years.
• The “tipping point” would come in 29 years, when a decline in the fund’s value would mean a 5.5 percent distribution would be less than a 5 percent distribution would have been, had the distribution percentage not changed.
• The impact to the fund will be swayed by future investment returns and oil and gas royalties.
• The permanent school fund is, by far, the largest part of the Land Grant Permanent Fund, but there are 20 other entities that also receive annual distributions. Here are the percentages:
Common schools: 85.807 percent
University of New Mexico: 1.234 percent
UNM Saline Lands 0.043 percent
New Mexico State University 0.383 percent
Western New Mexico University 0.023 percent
New Mexico Highlands University 0.023 percent
Northern New Mexico College 0.018 percent
Eastern New Mexico University 0.070 percent
New Mexico Institute of Mining and Technology 0.180 percent
New Mexico Military Institute 2.929 percent
New Mexico Boys School 0.005 percent
DHI Miners Hospital 0.805 percent
N.M. State Hospital 0.336 percent
N.M. State Penitentiary 1.764 percent
N.M. School for the Deaf 1.749 percent
N.M. School for the Blind and Visually Impaired 1.745 percent
Charitable Penal & Reform 0.714 percent
Water reservoir 0.895 percent
Improve Rio Grande 0.200 percent
Public Buildings 1.080 percent
Carrie Tingley Hospital 0.001 percent