House committee advances bill to establish New Mexico surface‑water permitting and cleanup fund

The House Agricultural, Zakia, and Water Resource Committee on Tuesday voted to advance a committee substitute for Senate Bill 21 (combined with Senate Bill 22) that would allow New Mexico to administer its own surface‑water permitting program, require state permits for waters left unprotected by recent federal changes, and establish state authority and a dedicated fund to clean up neglected and contaminated sites.

The committee vote followed hours of testimony from tribal governments, conservation groups, farmers, municipalities and industry. "I'm here to present Senate Bill 21, which takes some important steps to give our state control of our own water resources," the bill sponsor told the committee before outlining the measure's three main parts: primacy for a New Mexico NPDES‑style program, a state permitting pathway for waters no longer covered by the federal Clean Water Act, and a groundwater/contamination cleanup authority and fund.

The bill's sponsors and the New Mexico Environment Department framed the measure as a response to a 2023 Supreme Court decision that narrowed federal protections for many ephemeral streams and wetlands. Senator Wirth, a Senate sponsor, said the bill is the result of months of stakeholder work and multiple committee hearings in the Senate. "With 95% of our waters unprotected by that decision, this bill fills in that gap," he said, describing an advisory panel that included industry, tribal governments, local governments and environmental groups.

New Mexico Environment Department (NMED) staff described how the proposal would be implemented. Shelly Lehi, Surface Water Quality Bureau chief at NMED, told the committee the legislation would allow the state to apply to EPA for primacy and that the department expects a multi‑year, phased transition. "Once we approve this legislation, then there's a process we have to go through — rulemaking, funding, then we apply to EPA to take over the program," Lehi said. She estimated the earliest application timeline would be about 18 months to two years and that full phase‑in could take roughly five years; she said the state would initially take permits that are expiring or administratively continued by EPA.

NMED and sponsors provided implementation cost and staffing estimates: the department estimated roughly $8,000,000 per year at full implementation and about 60 full‑time employees (10 currently working on the program and roughly 50 additional positions). The committee also heard that the current state budget contains funding proposals tied to related cleanup work: witnesses and sponsors referenced a proposed $50,000,000 appropriation for neglected and contaminated sites and earlier Senate budget language mentioning $7,000,000 for startup support.

Supporters at the hearing included tribal representatives and a wide coalition of conservation and agricultural groups. JD Bullington, registered lobbyist for the Pueblo of Laguna, called the bill the Pueblo's "number 1 priority piece of legislation this year." Conservation and fishing groups urged the committee to pass the bill to protect headwater streams, wetlands and ephemeral reaches important to ecosystems and recreation.

Opponents — including industry groups, the New Mexico Chamber of Commerce, and some local governments — said they supported aspects of the proposal but expressed persistent concerns about rulemaking authority, workforce capacity at NMED, potential fee‑based funding, and delays or cost increases for construction and municipal projects. Kelly Fajardo of the New Mexico Farm Bureau said the bill gives broad rulemaking authority without a statutory guarantee that affected farmers and ranchers will have a seat at the table. Ashley Wagner of the New Mexico Oil and Gas Association said the Surface Water Advisory Panel had raised concerns about sustainable funding and staffing for the new program.

Committee members asked detailed implementation questions. Representative Matthews asked whether the EPA would continue to issue permits during the transition and whether there was any near‑term public health risk if federal permits were not renewed; Lehi said EPA would continue to administer the federal program until the state completed the primacy agreement but that if an EPA permit were rescinded before the state program was in place, state water‑quality standards could be enforced under existing law.

The committee proceeded to a motion to advance the committee substitute. Representative Laura Cadena moved the do‑pass motion for the committee substitute (Senate Judiciary Committee substitute for Senate bills 21 and 22); Representative Herrera seconded. The roll call recorded five yes votes and two no votes, and the committee announced the measure passed the committee stage 5–2 and will proceed to the House floor.

The measure contains multiple policy components: (1) language authorizing NMED to run a state surface‑water discharge permitting program (a state counterpart to the federal NPDES program); (2) amendments to the New Mexico Water Quality Act to require permits for some surface‑water discharges no longer covered by federal law; and (3) authority to clarify cleanup liability and to establish a cleanup fund for neglected and contaminated sites. Sponsors noted that the bill removes a private right of action that had been present in earlier drafts and includes language giving flexibility in program funding (fees, general fund, or a combination).

Committee sponsors and NMED said they plan rulemaking and further stakeholder work during the legislative interim and indicated decisions about fee vs. general‑fund financing remain to be made. The committee action advances the bill to the next step in the legislative process.

Next steps: the committee substitute now moves to the House floor for further action; sponsors and NMED said the department will continue rulemaking and planning ahead of any application to EPA for primacy.