The New Mexico Legislative Finance Committee met Wednesday to discuss the fiscal future of the state, amid concerns about COVID’s influence on New Mexico’s economy.
Steve Kopelman, the executive director for New Mexico Counties, spoke about how the climbing unemployment rate will hinder the state’s recovery.
“The unemployment rate in New Mexico…is close to 13%,” Kopelman said “And, you know, it was one thing when the federal government was subsidizing unemployment to the tune of $600 a week, now that that's not happening we're expecting this to just be a pile on. It's going to be very, very dire.”
Unemployment was up 8.4% from June to July, with over 197,000 unemployment claims filed last month. Kopelman empathized that the struggles of both individuals and small businesses are felt at the county level.
“It's way too early to [get into] anything hard and fast, but it's pretty clear that local government is going to be taking a major hit as we progress through this year,” Kopelman said. “The CARES Act funding is really going to be critical for municipalities and counties.”
The CARES Act funds in question total $750 million in COVID relieffor New Mexico. Of that, the governor allocated $140 million to the state itself, $182 million to Albuquerque and Bernalillo County, and $150 million to additional counties and cities in need of COVID relief. Tribal governments will receive $28 million in aid.
While CARES Act Funds will go a long way in supporting economic recovery, Acting Secretary for the Department of Finance Administration Debbie Romero says it simply isn’t enough to cover all of the economic challenges of the pandemic.
“There’s no doubt the needs outweigh what we have available,” Romero said. “I wish that we could just open up the checkbook and just be able to cover all these things because these are things that are impacting every single one of us throughout the state. We are trying to be as creative as we can but given the limited resources that we have there’s very few opportunities to deal with anything. We will continue to do what we can, and we’ll continue searching under every single rock for every opportunity.”
Legislative Finance Committee Chairman John Smith believes the legislature needs to look further into the future to secure economic prosperity for the state. He says New Mexico is in need of a long-term reliable revenue stream.
“I don’t think we’re looking far enough down the road on what’s happening and what we are going to do. It’s going to be dumped on the leg of the legislature because executive branches…can't see much beyond four or even eight years. And then the ramification falls on the legislative body to try and fix it,” Smith said. “Right now, we're only looking on how we're going to spend the $750 million. Obviously, we're all concerned about that, but I think we need to look a little further down the road. So, the name of the game right now is hand out vs hand up.”
