[{"_1":2,"_100":-5,"_101":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,76,88],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},"mediaId",6131956,"mediaKeyId","5727681-15b5a64fab0c99d6e3b749289b3d8572","parentId",5727681,"title","LFC, PED and LESC outline progress and shortfalls after Martinez‑Yazzie ruling; court orders remedial plan by November","audioSeconds",1000,"startMs",130000,"endMs",1130000,"viewUrl","/Search/View?dp=1&key=5727681-15b5a64fab0c99d6e3b749289b3d8572&start=130&end=1130","thumbnailUrl","https://assets.pipeline.soar.com/5727681-15b5a64fab0c99d6e3b749289b3d8572/thumbnail_130000.jpg","articleUrl","/articles/6131956/New-Mexico/LFC-PED-and-LESC-outline-progress-and-shortfalls-after-MartinezYazzie-ruling-court-orders-remedial-plan-by-November","mediaUrl","https://secure.pipeline.soar.com/6131956-8baa1c931bb205b70418e596a408e45f/orig.mp4?Expires=1775380653&Signature=gKvLIrmzpSF3~Cmaym471h3JlEZF0Wsb2ti0O~1TBZsKyH0cqYFuiir5uLP8D0uknvJNK78pEqfuZLoOcolELXfdOAPHG64st~0agTcTM9SRWZP5yrxoOC8ZMse43twDeGCQEr6YTGR-dzcyVVTgoS68nRCVwPINVpvYYMsCPk9G6Ex6bwa5Y8H9BLMNWSQxCoWuJD~DDFTENPO5tjh2~Fi74~xAP3f6ISZWhfu-oer3z2nRomHR20U9Vi8pP2IYokiJ8TQs77s9k5djbiRu6w3LVe~sGbdZLUd8lkEF~Ykms~rcQAF8K7M510xJxisuundvsBO-Rb7hXOaLg-~usw__&Key-Pair-Id=KUT5TJCACFTXG","author","New Mexico Legislature","date","2025-06-24T00:00:00Z","article","Legislative Finance analysts told the Legislative Finance Committee that New Mexico has substantially increased recurring school funding since the Martinez‑Yazzie adequacy ruling, but state and federal test scores and college remediation rates show persistent gaps that the court has ordered the state to fix.

The matter matters because the court found that the state must provide a uniform, sufficient education for at‑risk students, and this committee heard that funding increases alone have not closed long‑standing achievement gaps. LFC staff said the court has now directed the Public Education Department to prepare a remedial action plan with outside experts and that the court expects the plan by November.

“This lawsuit is based on a single line in the constitution requiring a uniform and sufficient education for all students,” LFC public schools analyst Sunny Lou told the committee, summarizing the case background and the court’s 2019 reasoning that inadequate inputs (funding, programs, teacher pay) were linked to weak outputs (reading and math scores, graduation and remediation rates). Lou and LFC colleague Rachel Mabe presented LFC’s updated “report cards” and analysis of inputs, outputs and pilot programs.

LFC framed the issue as a machine that needs matched inputs, outputs and outcomes: funding and programs are inputs; test scores and graduation are outputs; and outcomes are the longer‑term effects such as higher proficiency and less college remediation. LFC told the committee that since the court’s ruling the Legislature has increased the public school recurring budget — which LFC summarized as a roughly $2 billion increase and large investments targeted at salaries, at‑risk funding and extended learning — but that NAEP and state proficiency data show New Mexico still scores well below national averages and in many places below grade level.

Rachel Mabe, presenting LFC’s “outputs” section, used the nation’s NAEP scores to illustrate that the gap with national averages has not closed: “When you look at this, you’ll probably notice a few things… the space between them has not really changed, meaning that we continually score below the national average without closing the gap,” she said. LFC highlighted divergence between rising graduation rates and stagnant or weak proficiency and college remediation trends, noting the diplomas‑versus‑readiness question — more students are graduating, but a larger share still needs remediation in college.

Committee members pressed for longer timelines and clearer, measurable milestones beyond the short‑term Public Education Reform Fund (PERF) pilot projects LFC described. LFC said PERF (a 3‑year pilot fund) is designed to test interventions with explicit logic models so the state can learn which programs raise proficiency before making large recurring commitments. Lou and Mabe said PERF’s first round funded five projects and requires evaluation overseen by PED, LFC, LESC and DFA.

John Cena, staff director for the Legislative Education Study Committee, told the committee LESC’s work has identified four broad areas needing attention: educator pipelines and quality, academic design and classroom instruction, whole‑child supports, and statewide systems and long‑term planning. “We need to continue to work through these long‑term plans that outlive political and leadership change,” Cena said.

Public Education Department leaders acknowledged major financial steps but said gaps remain in specific, systemic requirements. The department’s representative said: “We have not had a proper accounting for the expenditure of those funds,” and described new accreditation and reporting steps the department will use to review school budgets and assurances — including assurances that at‑risk and special‑education funds are budgeted and used at the school level.

On the court timeline and next steps, LFC and PED said the court directed PED to develop a remedial action plan that will be developed with outside experts and in collaboration with LESC and LFC. The department reported it had issued a request for interest, received 14 proposals, and planned to form a team of national and local experts; it also said stakeholder engagement will begin in July and the state intends to submit a plan to the court by the ordered deadline.

Committee members urged more rigorous statewide metrics, regional breakdowns, and clarity about how new recurring dollars would be targeted and evaluated. Several legislators asked that the remedial plan and any future funding proposals include clear, measurable mileposts so lawmakers can see which districts and programs are producing results and which are not. LFC staff suggested a separate cost‑benefit or comparative analysis of different evidence‑based interventions could help the Legislature decide whether to expand pilots into recurring funding.

The session concluded with agreement among committee members, LFC and PED staff that: 1) New Mexico has raised inputs but still has uneven classroom‑level implementation; 2) a court‑ordered remedial plan is underway and must include evaluation and stakeholder engagement; and 3) the Legislature will press for clearer, school‑level accounting of at‑risk, special education and other targeted funds before making further large recurring commitments.

Looking ahead, the committee said it will review the remedial plan as it is drafted and may request additional evaluations and regional breakdowns of outcomes to support decisions about future recurring spending.","mediaType","Video","parentTitle","Legislative Finance Jun 24, 2025 12:23 PM - 5:36 PM","oneSentenceSummary","Legislative Finance analysts told the Legislative Finance Committee that New Mexico has substantially increased recurring school funding since the Martinez‑Yazzie adequacy ruling, but state and federal test scores and college remediation rates show persistent gaps that the court has ordered the state to fix.","taxTitle","Legislative Finance, Interim, Committees, Legislative, New Mexico","taxId",65385,"location","New Mexico","headline","","shortSummary",{"_33":77,"_35":36,"_37":38,"_39":78,"_41":79,"_43":80,"_45":81,"_47":82,"_49":83,"_51":84,"_53":85,"_55":56,"_57":58,"_59":86,"_61":62,"_63":64,"_65":87,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6131947,"LFC’s first tax‑expenditure briefs: high‑wage and rural‑job credits produce limited fiscal returns but support targeted hiring",82,1738000,1820000,"/Search/View?dp=1&key=5727681-15b5a64fab0c99d6e3b749289b3d8572&start=1738&end=1820","https://assets.pipeline.soar.com/5727681-15b5a64fab0c99d6e3b749289b3d8572/thumbnail_1738000.jpg","/articles/6131947/New-Mexico/LFCs-first-taxexpenditure-briefs-highwage-and-ruraljob-credits-produce-limited-fiscal-returns-but-support-targeted-hiring","https://secure.pipeline.soar.com/6131947-aa68171256a62a1cfd0261e0f8310e38/orig.mp4?Expires=1775380653&Signature=ew5hhtY4KY7w-u3lPbTkn4g~sNnrSRl9NIWGZwMnt7a8ZOBYERLoJTe1ufkb42bqQLLqCHzsTW9CmPvutuz4HRQQ6VqKQNC4RrS~Oc7RZ4nZatOfH-lsbtml-Af1ph0sUOxp2eIB72bEK-VelLN~MYl660bZVlS9hASmU~wZfVXAvaH21mM-FSsaTrM4Q8Ir5NOUxNJ0wB5WbGTx7IBscg0LXvP6M7WMr2r0-VJww-vxL2Vz2VjLgj42XLvW-KHR0Wgd5FI2jSH1armoMFQG6hAAJvzOzCRcjZJl2NgdZmkVjRjkjntP2AjpQ04ONrDvZFI7gjKunaqd1N6bXC8U3g__&Key-Pair-Id=KUT5TJCACFTXG","Legislative Finance staff presented the committee with the first short tax‑expenditure assessments (TaxE reports) for two economic‑development tax credits: the rural jobs credit and the high‑wage jobs credit. Both briefs summarized program history, recent usage, modeled economic impacts, and design considerations.

The TaxE briefs are informational: they quantify recent claims, estimate how the credits ripple through New Mexico’s economy using a regional economic model, and identify design features (sunsets, caps, urban/rural eligibility) the Legislature may wish to examine. They do not make policy recommendations or a cross‑sector cost‑benefit comparison — LFC said that can follow if the committee wants deeper comparative work.

For the rural job tax credit, LFC reported the program is small and falling in use: about $637,000 in claims in FY24 across roughly 45 claims. The model estimated an economic return on investment of about 35% (the state economy would grow by 35 cents for each dollar of tax credit), while the modeled return in state revenue was negative 83% — in LFC’s terms the state foregoes roughly 83 cents for each dollar of tax expenditure and receives roughly 17 cents back in direct state tax receipts. LFC noted the credit has no expenditure cap, no sunset and was created at $1,000 per job in 2000; inflation has reduced its real value and usage has declined.

The high‑wage jobs credit showed larger recent usage: LFC reported about $11.2 million in FY24 across 89 claims. LFC’s REMI modeling estimated an economic return of about 47% (growth of 47 cents per dollar spent) and the same negative‑83% revenue return calculation: the modeled increase in state tax receipts is smaller than the tax expenditure foregone. The high‑wage credit is scheduled to sunset on July 1, 2026; it has no statewide expenditure cap. LFC noted the credit targets jobs that meet JTIP eligibility and wage thresholds (different thresholds for urban and rural counties) and therefore is more narrowly targeted than a generic tax break.

Committee members asked whether the briefs could be expanded to include cross‑state comparisons, county‑level distributions and cost‑benefit calculations that would allow the Legislature to compare tax credits to direct, appropriated investments. LFC staff said those deeper analyses are feasible and recommended the committee specify next steps if it wants a full comparative cost‑benefit framework.

LFC also highlighted the briefs’ value as a quick, consistent briefing format — one page, front and back — to help the Legislature track multiple tax expenditures that collectively represent a large share of state fiscal resources. The LFC presenters noted tax expenditures total roughly $3 billion statewide and that economic development credits are a significant slice of that total. Committee members signaled interest in adding new performance measures and clearer sunset/cap rules to tax expenditure design going forward.","Legislative Finance released one‑page TaxE briefs for two business credits — the rural job tax credit and the high‑wage job tax credit — and reported both produce modest modeled economic growth while generating less new state revenue than they cost in foregone taxes.",{"_33":89,"_35":36,"_37":38,"_39":90,"_41":91,"_43":92,"_45":93,"_47":94,"_49":95,"_51":96,"_53":97,"_55":56,"_57":58,"_59":98,"_61":62,"_63":64,"_65":99,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6131951,"LFC finds major state liability for orphaned oil and gas wells; EMNRD and industry dispute causes and remedies",760,0,760000,"/Search/View?dp=1&key=5727681-15b5a64fab0c99d6e3b749289b3d8572&start=0&end=760","https://assets.pipeline.soar.com/5727681-15b5a64fab0c99d6e3b749289b3d8572/thumbnail_0.jpg","/articles/6131951/New-Mexico/LFC-finds-major-state-liability-for-orphaned-oil-and-gas-wells-EMNRD-and-industry-dispute-causes-and-remedies","https://secure.pipeline.soar.com/6131951-53587ecb1581505ba374bef327a1504f/orig.mp4?Expires=1775380653&Signature=NUBqKQJB7EtqwdcnhGhcJd0Et0meRhk~Ay0KwJ41PYe86UDVKAW3e7Z7IELTnb7jfIFqsHN2PdVAoeHotowzcM0ViR2L1mvYTurBNANzpWQ4FyEJg9JdiMMRnqcvV46BVTmV0ieIpY3J5Mi6TktDIuXMRM328tSHKqv-5YIhUVONNhertPIlQNy26qfxMdqB68DTE77oLHK82QCJWxu3uU0s~2dG7-rrpZ5MgvSxJ2M4MrJM~IpiIcUDdqu-B1K6HcTRBGLavSjbhCC2Po7rtIK3Ysh2KKZr0QG6YS2FLoPl97OdzI04GTNRo21Jfw8Bp-5sRTtMNj5uvHAeP-itkA__&Key-Pair-Id=KUT5TJCACFTXG","LFC staff told the Legislative Finance Committee that New Mexico faces substantial and uncertain liabilities to plug and reclaim orphaned oil and gas wells, and recommended reforms to procurement, financial assurance, and oversight to limit the state’s exposure.

The issue matters because LFC estimated the state’s current and likely obligations for orphaned and low‑producing wells total at least several hundred million dollars and could exceed $1 billion depending on which wells are counted, how costs evolve and whether additional liabilities emerge.

“The state faces significant and growing financial liabilities for oil and gas well cleanup,” LFC program evaluator Stephanie Joyce summarized during a staff presentation that reviewed how wells are classified, how plugging is contracted and how costs have changed.

LFC said the Oil Conservation Division (OCD) has substantially increased plugging activity using federal Infrastructure Investment and Jobs Act (IIJA) funds, that IIJA grants to New Mexico totaled about $55.5 million with eligibility for roughly $100 million more, and that those federal funds — together with the state reclamation fund balance — are still small relative to the study’s mid‑ and long‑term cost estimates. The report identified three liability categories: 1) wells the state already has authority to plug (LFC estimated 702 on state and private land), 2) a larger set of inactive wells likely to become state responsibility, and 3) a much larger group of very low‑producing wells that could become orphan liabilities if operators sell or dissolve them.

LFC presented numerical estimates: plugging and remediation of currently authorized orphan wells would likely cost at least about $130 million for plugging plus at least another roughly $100 million for remediation and reclamation for a combined current liability on the order of $200 million; adding the nearly‑certain backlog of inactive wells increased the report’s likely liability to roughly $700 million; and including at‑risk low‑production wells produced a possible total liability in the upper hundreds of millions to more than $1.6 billion depending on which wells ultimately transfer to state responsibility.

The report documented rising per‑well and per‑foot costs: average state‑contracted plugging rose from about $30,000 in FY19 to roughly $163,000 in FY24, and per‑foot costs rose from roughly $11 to about $43 in the same period. LFC staff attributed part of the rise to plugging deeper, more complex wells and to broader market inflation for oilfield services, and they flagged procurement and oversight practices — including limited competitive bidding on some state contracts and billing controls — as potential contributors to higher costs.

LFC recommended several reforms aimed at reducing state cost and risk, including: strengthening financial assurance rules so operators carry sufficient upfront liability; exploring trust‑style or site‑specific escrow accounts that operators fund over a well’s life; improving OCD contracting and oversight (for example, placing a state representative on site during plugging for quality control and invoice verification); and prioritizing operator‑led cleanup over agency contracting where feasible.

Deputy Secretary Shelton of the Energy, Minerals and Natural Resources Department told the committee the report was “an exhaustive, comprehensive, well researched, accurate, and fair report” and emphasized technical reasons that individual wells can be far more expensive to plug than initial estimates suggest. Shelton described examples where cement circulation and damaged casings made plugs far more time‑ and material‑intensive than anticipated and said OCD’s costs were comparable to private industry once transportation and statutory plugging requirements were included.

Industry representatives told the committee they support efficient cleanup but urged caution about raising bonding limits or other rules in ways that could force smaller operators out of business and thereby increase orphaning. Jim Winchester of the Independent Petroleum Association of New Mexico said industry already pays reclamation taxes and that those funds have been reduced over time by legislative draws; he argued restoring that fund and using it efficiently would address many problems. Ashley Wagner of the New Mexico Oil and Gas Association emphasized that operators plug the large majority of wells and urged procurement and oversight fixes so state dollars buy more plugging for each dollar spent.

LFC and EMNRD staff acknowledged the state must balance competing risks: increasing financial assurance can reduce the chance of future state liability but can also impose costs that may affect small operators; better procurement and oversight can reduce per‑well cost, but unpredictable downhole conditions create unavoidable cost variability. The committee asked staff and agencies to return with follow‑up information on contract procurement, the list and location of wells included in various liability buckets, and precise balances and recent uses of the reclamation fund so legislators can weigh possible statutory or policy changes.

The report and discussion give the Legislature a menu of policy levers — higher bonding and different bonding forms, trust funds, procurement and on‑site inspection rules, and more active pursuit of financial assurance forfeiture — that will require follow‑up hearings and legal drafting to consider tradeoffs and avoid unintended consequences, industry leaders said.

Committee members asked for more operational detail on how many wells could be plugged this year under expanded contracting and whether the state could shift to more operator‑led cleanup with targeted oversight to keep costs down. LFC recommended additional oversight and clearer accounting of plugging costs and invoices as immediate next steps while the larger policy questions — how to fund long‑term plugging and whether to change bonding rules — are considered.","LFC staff told the Legislative Finance Committee that New Mexico faces substantial and uncertain liabilities to plug and reclaim orphaned oil and gas wells, and recommended procurement and financial‑assurance reforms to limit the state’s exposure.","actionData","errors"]

Article not found

LFC, PED and LESC outline progress and shortfalls after Martinez‑Yazzie ruling; court orders remedial plan by November

LFC’s first tax‑expenditure briefs: high‑wage and rural‑job credits produce limited fiscal returns but support targeted hiring

LFC finds major state liability for orphaned oil and gas wells; EMNRD and industry dispute causes and remedies