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New Mexico Legislature Adjourns, Passing Budget And Tax Plan

  SANTA FE, N.M. (AP) — The Democratic New Mexico Legislature sent a $7 billion spending plan to an allied governor that hikes spending on low-income students, teacher pay and infrastructure as the annual legislative session came to a close Saturday.

In the final minutes, lawmakers approved a bill over Republican objections that would raise some taxes, while offering a larger family tax credit.

Gov. Michelle Lujan Grisham and legislators are confronting a mid-April deadline to provide a district court judge with a plan to turn the state's troubled public education system around or possibly concede authority over public school resources to the judiciary.

A general fund budget for the fiscal year starting in July would increase annual spending on public education by 16 percent to $3.2 billion. New Mexico schools rely almost entirely on state dollars.

A booming oil sector in the Permian Basin that straddles the state line between Texas and New Mexico is providing a financial windfall to state government at the same time Democrats have consolidated power over the House and every statewide elected office. Much of the surplus will be reinvested in improvements to physical infrastructure, from roadways to high-speed internet lines.

"What we've done is provide resources to improve our education system, to improve our infrastructure, to make sure that new initiative gets off the ground, like outdoor recreation programs," said Rep. Patricia Lundstrom of Gallup, chairwoman of the lead House budget committee. "We've done more to help with health care. There's just a heck of a lot."

State economists have warned that surpluses could evaporate suddenly with a shift in oil markets, and lawmakers spent the final hours of the session in negotiations over a tax bill that might provide limited new sources of income to sustain teacher pay and government services.

A final-hour compromise on taxes emerged Saturday between House and Senate lawmakers, including new taxes on auto, cigarette and internet sales.

Fiscally conservative lawmakers were wary of seeking any tax increases on top of a government fiscal surplus, but some Democrats wanted to shift tax burdens toward higher income residents.

The compromise legislation would increase taxes on capital gains and likely raise the top personal income tax bracket.

"To us, one of the top priorities was to bring progressivity to the tax code," said Rep. Javier Martinez, D-Albuquerque.

GOP Rep. Jason Harper of Rio Rancho said the state "is in the position of raising taxes because we spend too much money."

After the session ended, House Republicans immediately denounced it as "one of the worst" they have experienced in recent history and accused Democrats of breaking rules to push through legislation.

GOP House Minority Whip Rep. Rod Montoya, R-Farmington, said Democrats stifled debate and often refused to work with Republicans on various measures.

"This became the year that Santa Fe imposed their will on the rest of the state," Montoya said.

House Republicans praised the Senate, controlled by conservative Democrats, with at least halting some of the more liberal bills.

A proposal to legalize and tax recreational marijuana, for example, stalled in the Senate after winning House approval.

In the early morning hours Friday, the Legislature passed a bill that would set in motion an independent state ethics commission for complaints about the conduct of public officials. The seven-member commission was authorized by statewide vote in November 2018, in the wake of a series of high-profile public corruption scandals.

The bill limits the commission's subpoena powers to requests authorized by a specially appointed judge. Complaints wouldn't be made public until 30 days after a probable-cause finding to allow time for a settlement. Criminal violations may be referred to state and local prosecutors.

While progressive initiatives on abortion and medically assisted suicide failed, the session highlighted consequences of sweeping Democratic midterm election victories in New Mexico.

Major changes to the oversight of gun purchases were signed by the governor, and legislators passed a bill to ensure that firearms are relinquished by people who have been ordered to stay away from domestic violence victims.

A bill dubbed the Energy Transition Act was awaiting the governor's signature to provide incentives for electric utility companies to close down a major coal-fired power plant and invest in solar arrays and wind turbines. New Mexico's version of a "Green New Deal" aims for carbon-free electricity production within a generation.