Public schools could avert deep cuts in June session, top lawmaker says

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Heath Haussamen/New Mexico In Depth

A statue of children outside the Roundhouse in Santa Fe.

New Mexico has enough from savings plus new money from Washington to help public schools weather looming budget shortages, says Sen. John Arthur Smith, D-Deming, a powerful lawmaker who helps to shape each year’s state budget.

“It would be prudent to make some cuts but not deep cuts for the 21 budget,” Smith said Thursday morning of the public education portion of the spending plan for the fiscal year that begins July 1. 

On Wednesday during an online update on COVID-19, Gov. Michelle Lujan Grisham expressed a desire to keep spending on public schools intact during a special legislative session she has called for June 18 to tackle a budget hole projected between $1.8 billion and $2.4 billion for the state’s fiscal year that begins July 1. 

New Mexico Gov. Michelle Lujan Grisham gives an update on the COVID-19 outbreak in New Mexico and the State’s effort to limit the impact of the disease on residents. The news conference is being held at the State Capitol in Santa Fe, Wednesday May 20, 2020. (Eddie Moore/Albuquerque Journal)

On Thursday her spokesman, Tripp Stelnicki, reiterated his boss’ position: It’s “premature to talk about cuts. We’ll know when the special session gets closer.”

The significant hit to the state budget is due to a near shutdown of the economy to fight the COVID-19 pandemic, which led to a collapse in consumer spending and global demand for oil and gas, both of which feed New Mexico’s revenue base through wages and taxes. 

Smith based his opinion on multiple developments: the lion’s share of $120 million from the recently passed CARES Act in Washington that will go to the state’s 89 school districts and dozens of charter schools. New Mexico’s decision to salt away in savings more than $1.5 billion dollars during the legislative session that ended in February. And $325 million in money that individual school districts have in their own reserves.   

Smith said he sees the advantage of blending money from the CARES Act, state reserves and cash balances schools carry to lessen the pain for public schools around the state.

“It would be prudent this year,” Smith said, “to start looking at taking that 25 percent reserves” and spending “about half” on the 2021 fiscal year and saving the other half for the following year should the downturn in revenue continue.

A big part of the help going to public schools comes from the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Sen. John Arthur Smith, D-Deming

The biggest share of that pot of money — $97,086,484 — will target around 680 of New Mexico’s schools because they are designated Title 1 schools, according to the state public education department. Title 1 gives “financial assistance to local educational agencies (LEAs) and schools with high numbers or high percentages of children from low-income families to help ensure that all children meet challenging state academic standards.”

The amounts to be dispersed range greatly. Albuquerque Public Schools, ($25.9 million); Gadsden Independent Schools in Dona Ana County, ($7.8 million), Las Cruces Public Schools ($7.3 million) and Gallup-McKinley County Schools ($7 million) are eligible for nearly half of the amount in this pot of money. The balance is divvied up among the other 80-something school districts and dozens of charter schools around the state, with help for some districts and charter schools coming in at under $100,000. (The breakdown for the state’s local education agencies is below.)

This week, the state’s public ed department opened applications for the eligible Title 1 schools to access the money reserved for them. The deadline to apply is June 1, a spokesperson with the public education department said.

In a memo from PED on May 14, schools were given guidelines on how the money can be used to support essential education resources based on needs.

For instance, Albuquerque Public Schools plans to use its Title 1 money to cover expenses for both this school year, which ends June 30, and next school year’s budget, which begins July 1, according to district spokesperson Monica Armenta.

Nancy Martira, PED spokesperson, explained that it’s OK for schools to split the money between budgets or put it all in one. 

The guidelines provide 21 different bullet points for how and where schools should spend the federal aid when it’s received. The list includes academic resources for technology and social distance learning, support for marginalized students and mental health services. 

Schools are also encouraged to spend the money on their coronavirus response — such as personal protective equipment, industrial cleaning supplies and plans to coordinate support for long term closures — which is a new reality for any budget process. Schools cannot spend the money on lobbyists, expenditures or bonuses.

The rest of the federal funding, about $22.2 million, will be distributed to public schools and the state’s higher education institutions through the Governor’s Education Emergency Relief (GEER) Fund, which is available to all schools in the state, not just Title 1 institutions, state public education officials said.

The governor’s office said its application to the federal Department of Education to trigger GEER funds is in the works and will be submitted soon. New Mexico schools can apply for GEER funds once it opens.

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