This week New Mexico policymakers adjourned their special legislative session, which focused on tax breaks for low- and middle-income residents. The Land of Enchantment is one of a handful of states that is not experiencing budget shortfalls. The state is actually enjoying surplus revenues generated because of the state's ability to produce oil and gas. However, the tax relief package that was ultimately approved by legislators amounted to about half of what Governor Bill Richardson requested. Recent budget projections show that the state's windfall is expected to decline from about $400 million to $200 million.
In fact, the Governor asked for an enormous temporary tax rebate package that had a $120 million price tag. The rebate package that became law was about $56 million. The one-time rebate is targeted to New Mexicans with AGI of less than $70,000 and is scheduled to arrive in mail boxes by Thanksgiving. He also requested about $58 million for children's health care, but the final legislation included only about $20 million. A portion of revenues was also put aside for highways. Kudos to New Mexico lawmakers for adjusting the package when revenue projections changed and for making the bulk of the package temporary and targeted.