Today’s blog outlines in more detail why we need you to raise your voice in relation to cannabis, predatory lending, early childhood, and more.

Legislative Update

More On SB 66 Permitted Percentage Rates for Loans

Yesterday, I summarized how the House Judiciary Committee hearing played out and the roles played by Reps. Eliseo Alcon, Micaela Cadena, and Georgene Louis in gutting the bill. While I think elected representatives are accountable for their decisions, I want to contextualize my comments to acknowledge that the votes made by these legislators came within a system that fosters poor decisions. Actually, the current system doesn’t just foster bad decisions, it guarantees them.

With no staff and almost no time, an amendment can be introduced that totally transforms the bill from its intended purpose (e.g. community solar, predatory lending). The amendment is then often explained in a disingenuous manner, with the real intent of the amendment disguised as advancing the bill’s original intent. Legislators, without the opportunity to check in with staff or to take a few hours to review the implications of the amendment, vote for what they understood and hoped an amendment would do without really understanding what it actually would do.

In the instance of SB 66, Reps. Cadena and Louis both voted for an amendment hoping that it would fill a need and afford an option for those who Louis and Cadena were trying to protect: poor people desperate for a loan. But in fact, the amendment would open the door for people they were trying to protect to be exploited. It isn’t that Reps. Louis and Cadena are bad legislators or insensitive people, quite the contrary. But they were misled and made a bad vote, a bad vote they can reverse by introducing and supporting amendments to restore the 36% rate cap.

After the session, we need to have some deep discussions about how the legislative process unfolds and how it can be fixed. See the bottom of this post for information about a national effort for regulating Predatory Lending.

HB 12 Stalled in Senate Judiciary

According to Joe Monahan’s report today, 150 bills are stalled in SJC, including HB 12 Cannabis Regulation Act. Given that this is a high Democratic leadership priority, one would think this would get to the top of SJC’s agenda, especially given the dwindling number of days left in the session. But SJC devoted an entire hearing to reviewing and amending HB 20 Healthy Workplaces Act (paid sick leave) when it had already passed through two other Senate Committees and was on the Senate floor, awaiting passage. Sen. Cervantes has placed HB 12 ninth on a crowded agenda for this afternoon. Recall that it was Sen. Cervantes who in 2020 led the effort to table the cannabis legislation in SJC because he wasn’t comfortable with the bill. Time to send letters and make calls to Senate Judiciary Dems. Check today’s alert at this link for details.

If you go to Monahan’s report, linked above, and scroll down to his March 15 entry, you will find three recommendations for making this a “transformational” session. Among them is passage of HJR 1 Permanent Fund for Early Childhood. Given the bill is now on the Senate floor that mission is almost accomplished. But it is the third item on his list that caught my eye, something I have written about all session. We have an abundant, record-setting amount of reserves and a crystal clear need to address rural broadband. Instead of devoting a big chunk of those funds to address that need, we’ve created another group to conduct yet another study. It is likely too late to achieve this objective this session, but this needs to be front and center in our 2022 session with no excuses or additional plans to plan. From Joe Monahan:

“Speaking of the outsized reserves, appropriate $600 million from them immediately (grab your heart, David Abbey ) for a broadband expansion fund. Set aside $50 million or more of that fund to subsidize initial broadband service for lucky but low income households. (That’s for you Sen. Ortiz y Pino). Also, bring back and amend the bill already passed that establishes a broadband office to coordinate current broadband efforts. Since so much groundwork has been laid but not been put into action, give the new office just 6 months to come with a comprehensive plan and then begin spending the appropriation which can be leveraged with federal resources for even more impact and get close to the $3 to $5 billion it will take to wire the state. (Kudos to Sen. Padilla and Senate Finance Chair Munoz for work on this. They just need to think bigger.)’

Joe Monahan New Mexico’s Blogspot March 15

House Joint Resolution 13 Passes

This is a bill that escaped our radar, but we STRONGLY support it. House Joint Resolution 13 has passed on the House floor and now heads to the Senate. HJR 13 would extend the length of sessions during even-numbered years from 30 days to 45. Odd-numbered years would remain at their current length of 60 days.

The bill also would do a great deal to make the short session more open by freeing it from restrictions on what kind of bills can be introduced. HJR 13 would eliminate current restrictions that limit the short session to bills related to the budget, to legislation requested by the governor, or to those vetoed by the governor the previous year. Those three limitations severely restrict the possibility of introducing great bills that simply ran out of time in the prior session. It also would change the effective date for legislation, usually set at 90 days after the Legislature ends, to 75 days after that date. As a joint resolution, the bill would not require the Governor’s signature, a very good thing given her penchant for concentrating power in her office. Likely she would veto this bill, but instead it would go to the voters in 2022. In an upcoming Legislative Alert we will offer info on pressing the Senate to get this done. Not much time, but possible.

Our recommendation to Senator Wirth: please do not send this to Senate Rules because Chair Lopez has said in the past that she would never call to a hearing any bill extending sessions. Her objection: the workload is way too much as it is. And while she is right, I think passage of this legislation could be good justification for finally passing legislation to pay legislators and provide them with staff. Second recommendation: don’t send this resolution to Senate Judiciary for the obvious reason that they have too many bills stacked up already.

Senate Finance Passes the Budget

Just a quick note here: yesterday SFC passed an amended $7.4 billion spending plan for the state on a 6-4 vote. The proposal represents a 4.8% increase in spending, or $373 million, over the current fiscal year. It now goes to the Senate floor for final passage. When considered in the context of other SFC actions, like passage of HJR 1 and passage of legislation to create more transparency in capital outlay allocations, we are far happier with Sen. Muñoz’s leadership than we were with Dr. No’s (former Sen. John Arthur Smith).

SB 8 Stringency  on Air Quality and Hazardous Waste

By an 8-4 vote, House Judiciary voted along party lines to pass SB 8. It now moves to the House floor. It’s last stop before heading to the Governor’s desk.

For far too long, New Mexico’s environmental agency has been handcuffed by an antiquated law that constrains it from creating air and hazardous waste pollution protections more stringent than federal regulations. SB 8 would eliminate this law. The existing law has enormous consequences statewide – and particularly for environmental justice communities, who are most likely to be impacted by hot spots of pollution, including methane, volatile organic compounds, and hazardous air pollution from oil and gas operations. The stringency limitations also have kept the New Mexico Environment Department from setting standards for clean up of per- and poly-fluorinated substances (PFAS). PFAS persist in the environment, and people are mostly likely exposed by consuming PFA-contaminated water or food. Exposure may also occur by using products that contain PFAS. From Food and Water Watch:

“An ineffective and broken regulatory system and weak environmental laws in the United States have done little to stymie the ever-revolving chemical treadmill that has contaminated entire communities and put public health at risk.”

Food & Water Watch: “These Chemicals Are Forever: Water Contamination from PFOA, PFOS, and other PFAS”

Human health effects from exposure to low environmental levels of PFAS are uncertain. Studies of laboratory animals given large amounts of PFAS have found that some PFAS may affect growth and development, reproduction, thyroid function, the immune system, and injure the liver.

HJR 1 passed the Senate Finance Committee!

This is a HUGE victory for children age 5 and younger, families, early educators, and our entire state! If approved by the full Senate and the voters, this will result in reliable and sustainable funding for childhood programs. HJR 1 was amended to include K-12 education. The total increased distribution would be 1.25% from the Land Grant Permanent Fund (Fund). The changes are as follows:

• Early childhood programs: 60% of the 1.25%
  • At the current size of the Fund, that would be about $130 million per year.
  • If the constitutional amendment passes the voters and appropriations were to begin on July 1, 2022, that will be worth $150 million. 
  • Before the amendment, early childhood would have received 100% of 1%. By accepting the amendment, early childhood receives just 7% less funding than it would have received had they received 100% of the 1% increase in Fund allocations. But in accepting the compromise it ensures that A) the bill will pass the Senate and get to the ballot in 2022, and B) K-12 will receive an additional $84 million in funding.
• K-12 education: 40% of the 1.25% 
  • At the current size of the Fund, that would be about $84 million per year and will increase with the natural growth of the Fund.

HJR 1 now heads to the Senate floor for a final vote! This would not have happened with former Sen. John Arthur Smith in charge of Senate Finance. He killed this bill all by himself by refusing to hear it in Senate Finance year after year. Elections matter.

Timeframe for ACTION: Today. Who: Contact your Senator in support of HJR 1. Find your Senator’s contact information here. 

HB 20 Healthy Workplaces Act Passes Senate Judiciary…Barely

It was another tough Senate Judiciary hearing with Sen. Ivey-Soto grilling bill sponsors and ultimately joining the GOP in voting no. No matter how many ways it was explained that his amendments would simply not be workable, Ivey-Soto insisted on including public employees, despite sponsor objections that public employees already receive benefits. Ivey-Soto also insisted on removing the 80-day supplemental sick leave during a health emergency. Finally, he kept insisting that the bill didn’t need to define all the terms and definitions because they existed in federal labor law. He felt it would make more sense to strike all that language and reference federal law. In the end he relented on his notion of presenting a bill substitute today, but voted no on the bill. Sen. Cervantes came through, voting “do pass” despite having some reservations. To get his vote, Cervantes extracted a promise from bill sponsors to not seek or support any further amendments to the bill as amended by SJC. By a 5-4 vote, the bill passed and is headed to the Senate floor.

Today, we provide a guest op-ed from our friend and ally Norm Gaume. It lays waste to the Governor’s claims that NM is a national model in addressing climate change and NM gas and oil lobbyists’ claims that NM operators are the cleanest in the nation. This was published in the Santa Fe New Mexican yesterday. From Norm:

Don’t Let Gas & Oil Off The Regulatory Hook

In New Mexico, it is OK for oil field operators to spill oil and liquid waste into the environment.

Dramatic increases in fracking over the past few years have brought great increases of oil and gas liquid waste. The waste is a combination of fracking flow-back waste and deep, salt-laden groundwater commingled with oil and gas. Operators report four barrels of waste liquid for every barrel of oil.

“Produced water” is the oil and gas industry’s name for its poisonous waste liquid. Permian Basin waste liquids are more than 10 percent salt by weight. All produced water is grossly contaminated and toxic.

Spills are common. Two spills of waste liquids per day account for about half of all reported spills. Operators must self-report spills to the state and are supposed to clean them up. Actual state oversight is slight. No penalties apply.

The industry self-reported 166,000 acre-feet of waste liquids were produced in 2019. The state engineer reported freshwater used for fracking in 2018 was 60,000 acre-feet. He called that a problem.

Freshwater used for fracking adds substantially to the overall oil field wastewater disposal burdens. Fracking turns good water into waste liquids.

The top-ranked New Mexico oil producer says it uses 98 percent recycled produced water instead of freshwater for fracking. Others could do the same but choose not to.

At the same time New Mexico’s oil and gas production, state and local revenues, and spills have increased, state government enforcement has been virtually absent. Inspections and requirements were decimated by the Martinez administration and remain ineffective today.

Occasionally, oil and gas wastewater spills draw public attention. The burst wastewater pipeline that exploded and sprayed a family, their home and their animals last year was news. The responsible company received no penalty and continues to receive permits and approvals. The family had to euthanize their animals and move because their home and land were contaminated.

Less public attention has been paid to a large waste spill into Chaco Wash and groundwater that provides tribal communities’ drinking water. These were two of the 2,090 liquid waste spills self-reported by oil and gas registered operators from 2017-19, according to public spills data on the Oil Conservation Division website.

New Mexico’s top-ranked oil and gas producer reports a relatively low number of spills per million barrels of oil and gas (equivalent barrels). The second- and fourth-ranked producers, according to posted Oil Conservation Division data, have much worse records, with almost 10 times as many wastewater spills per million barrels of energy. The operator for the first spill described above has a spill record that is 18 times as bad. That operator’s explosion and dayslong fire in 2017 drove a Chaco-area tribal community from its homes.

Operators cite equipment failure, corrosion, human error and overflows as causing 85 percent of reported spills. One New Mexico operator with a relatively good spill record said investments are required to prevent spills. Other operators choose to allow many more spills.

New Mexico spends a third and a fourth of the respective regulatory and enforcement budgets of North Dakota, which produces a similar volume of oil and gas, and Oklahoma, which has a similar number of oil and gas wells.

The oil and gas industry can’t be let off the hook with no regulation, no inspections and no enforcement. New Mexicans deserve better. The Legislature continues to take oil and gas revenue while failing to spend what is necessary to protect public health, the environment and freshwater from the oil and gas industry’s huge volumes of toxic, salty liquid waste.

Norm Gaume is a native of New Mexico and a graduate of Hobbs High School and New Mexico State University. He is a retired water and wastewater engineer, lives in rural Sandoval County, and subscribes to The New Mexican.

Thank you, Norm. I would add that this year we have record reserves and more than adequate capacity to fully restore funding to NMED and OCD. We will report on the status of that funding in the very near future.

National Effort to Curb Predatory Lending

The Stop the Debt Trap Coalition is trying to get a large list of signers, including people in every state, so please sign on to this letter telling Congress to stop predatory lenders from evading state interest rate caps (current or future ones) by repealing the Office of Controller of Currency or OCC’s “fake lender” rule.

This rule overturns 200 years of caselaw endorsed by the Supreme Court that allows courts to prevent usury evasions. The rule replaces the longstanding “true lender” anti-evasion doctrine with a “fake lender” rule that allows lenders charging rates of 179% or higher to evade state and voter-approved interest rate caps merely by putting a bank’s name on the paperwork — exactly as payday lenders did 20 years ago.

The rule has already been challenged by eight Attorneys General. Please sign on to this letter. We are extending the deadline to Friday, March 26.

The Stop the Debt Trap coalition has a new 2-page issue brief with more: Overturn the OCC’s “Fake Lender” Predatory Lending Rule. 

Please also save the date for a webinar on this topic March 24 at 2 pm EST.

Here are the current signers — add your name if your nonprofit organization is not on this list!

That’s it for today.

In solidarity and hope,

Paul & Roxanne

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