In a big state with a small population, paying for roads has always been tough, even during boom years. We simply have needs that outstrip whatever money is available.
Last year, an interim legislative subcommittee took an idea from the past and reshaped it for transportation. New Mexico has a number of trust funds established during times of high revenues. Instead of just spending all the money, lawmakers set it aside to be invested for future use.
In this case, the interim Transportation Infrastructure Revenue Subcommittee tried to create a transportation trust fund from a one-time appropriation. The state would then invest that money, and returns would flow to the State Road Fund for projects the state Department of Transportation has prioritized.
The bipartisan bill had a lot of support, especially from rural lawmakers. It passed the House unanimously but died in the Senate Finance Committee because “people on the budget committees didn’t include it in the budget,” said co-sponsor Rep. Patty Lundstrom, D-Gallup. And once the budgets are set, legislators don’t like to tinker with them.
This year, the subcommittee is back with another trust fund bill, HB 42, which sponsors have pre-introduced. And the trust fund still isn’t in either the legislative budget or the governor’s budget, Lundstrom said.
“It means a lot to rural New Mexico,” she said.
HB 42 responds to August testimony by state Department of Transportation Secretary Ricky Serna, who said his agency needs financial stability. His budget has grown steadily but so have costs.
NMDOT receives no money from the general fund. Instead it relies on fuel taxes, the motor excise tax, and registration fees. These revenues fluctuate (fuel taxes plummeted, for example, during the pandemic), and electric vehicles don’t pay fuel taxes. As fuel efficiency has improved, that too has depressed tax revenues.
Expenses are up for construction, maintenance and salaries. At any given time the department manages 90 active projects and 34 construction crews.
Maintenance is a catchall that covers everything from striping to rest-area improvements to emergencies like sinkholes and wrecks. The department maintains the state’s second largest amount of space among state agencies, including 16 rest areas.
“Maintenance is the low hanging fruit,” Serna said, meaning it’s the easiest to cut. He’d like more money for maintenance.
For its 2,500-plus employees, NMDOT must meet legislative mandates for higher pay. It has a 20% vacancy rate, but in hiring engineers it must compete with the private sector.
To fill the gaps, NMDOT leans on the State Road Fund, which is stretched over many categories of spending.
In recent years of strong budgets, lawmakers agreed to one-time spending on transportation. Since 2019, Serna said, NMDOT has received more than $1.5 billion and used it for maintenance, construction, equipment, airports, wildlife corridors and more. New Mexico roads improved noticeably, he said, but transportation planners can’t count on one-time appropriations in the future.
That’s why the department and the subcommittee will ask again for a transportation trust fund. Day Hochman-Vigil, D-Albuquerque and co-sponsor of HB 42, said in November that it would use a one-time general fund appropriation to create a fund, and investments would then generate recurring revenue for NMDOT. It could only be spent on “approved projects prioritized by a cooperative and comprehensive process of the Department of Transportation that aligns with the department’s long-range plans and addresses the multimodal needs of New Mexico’s transportation customers,” according to the bill’s language.
Sen. George Muñoz, chairman of the Senate Finance Committee, urged the interim subcommittee to endorse the bill. In a text he said that the hurdle in creating a trust fund is appropriating a large enough amount of money to produce a good return.
However, the transportation trust fund isn’t in either the governor’s or the legislative budgets, Lundstrom said. And it’s a 30-day session, which doesn’t allow much time for maneuvering. This may be another good idea that takes years to accomplish.
Sherry Robinson is an award-winning author and journalist. She is the author of several books. She lives in Albuquerque, New Mexico.
