House budget package leaves Senate with 5.8% recurring growth, 31.2% reserves; lawmakers outline top investments

A committee staff member told the Senate Finance Committee that the House'approved budget framework leaves the House with a 5.8% recurring spending increase and roughly a 31.2% reserve, above a 30% target.

The presenter said the Legislature'approved broader package came in at 5.6% overall, with the House position at 5.8% (a 0.2% recurring difference), leaving capacity for the Senate to consider additional recurring investments. The presenter named major recurring increases the House committee adopted: a $10 million recurring add for secondary education factors within the school funding formula and $1.6 million recurring for step increases at the Department of Public Safety. The Office of the State Engineer received a $1.5 million recurring increase and economic development and livestock board lines received smaller recurring additions.

The presenter said nonrecurring priorities include $50 million for abandoned uranium and other contaminated-site cleanup and a $110 million package for housing targeted to unhoused populations, with emphasis on Albuquerque and Bernalillo County. Water funding carried over from the Legislative Finance Committee included a $200 million Water Trust Board allocation and $19 million for aquifer mapping; the presenter said total water appropriations in the package were about $420 million, including $40 million for strategic water supply. Medicaid projections declined, the presenter said, allowing the Human Services/Health Care Authority side of the budget to meet most of the HCA executive request, including $9 million for nursing-home rebasing and additional positions for SNAP administration and provider rate increases. The presenter said the committee allocated $37 million over three years for the Children, Youth and Families Department for recruitment and retention priorities rather than placing the full amount in the base.

Committee members asked for more detail on specific items: reimbursement rates in the Health Care Authority were described as 150% of Medicare for three core areas (child and maternal health, primary care and behavioral health) and 100% of Medicare equivalent reimbursement for other areas; senators asked whether those percentages could increase for specialties. Members also pressed for breakdowns of ECECD allocations and site-readiness and quantum investments; the presenter said the package contains roughly $48 million for quantum initiatives and that half of an expected additional ECECD trust-fund distribution was allocated by the House.

Transport and local roads questions centered on a new $100 million local road allocation in the bill and unspent DOT funds dating to 2021; the presenter said there are large unspent balances in DOT accounts and that committee staff could provide more precise tracking. Several senators sought follow-up reports on CYFD deficits, foster family incentives and specific agency funding details.

The committee heard the overview without a formal committee vote on the summary itself. The presenter described the House process as unusually collaborative, citing multiple subcommittees and working groups and repeated public sharing of working documents.

Less critical details: the presenter said the committee tried to stay within a 6% recurring target to preserve multi-year sustainability and that discussions about a separate tax package remained unresolved.