New Mexico: Infrastructure, Education Reap Rewards Of Oil And Gas Revenues
Millions of dollars are headed to southeast New Mexico as part of the New Mexico Department of Transportation’s plans to reinvest oil and natural gas revenues into shoring up the roads serving the booming Permian Basin.
Hundreds of millions of dollars more, also from the state’s oil and gas boom, could be headed to education, if a bill for prekindergarten programs makes it through the Roundhouse this session.
This week, New Mexico Secretary of Transportation Michael Sandoval announced $130 million for U.S. Highway 285 was already funded. Speaking to business leaders from the Carlsbad area, Sandoval said the rebuild would serve the region’s growing truck traffic, a problem Western Wire first reported on last March.
John Waters, Executive Director of the Carlsbad Department of Development, said that the most important accomplishment for his group in 2019 was drawing attention to his region’s crumbling infrastructure.
“At least we got the word through to Santa Fe that we needed money down here for our roads. Anybody that’s down here, whether you are in oil and gas or just live down here, our roads are taking an incredible hit,” Waters said last March.
Eddy and Lea Counties needed the money generated by a booming oil and gas surplus reinvested in the counties’ roads, he added.
Sandoval said that easing industry concerns for an alternate route during the rebuild was a priority.
“We know that project will be a big inconvenience to the oil and gas industry. We want to make sure people have options,” Sandoval said. “We want to make sure oil and gas is still mobile in that area.”
It’s likely the industry will step in to support the alternate routes, according to Eddy County Director of Community Services Wes Hooper.
Additional repairs to two other roads had about $170 million of the funding needed, but about $150 million in additional funds were still being sought to complete the projects.
NMDOT has a $300 million surplus this year, thanks in large part to the outsized revenues from oil and gas production.
Sandoval pledged to continue supporting the oil and natural gas industries to maintain the state’s momentum, he said. “You’re county is one of the main reasons we have this money. We want to try to bring in as much money as we can to go to local infrastructure. Some of that would definitely go to southeast New Mexico. We care about the entire system. We just want all of it to just work together.”
But the boon to the state’s transportation infrastructure won’t preclude hundreds of millions to possibly create a new state trust fund for prekindergarten programs, a vote this week demonstrated.
On Wednesday, the state Senate voted 40-0 to approve the endowment, also drawing from the state’s oil and gas boom. The trust fund would set aside more than $300 million if approved.
As Western Wire reported last year in a four-part series covering New Mexico’s budget priorities and the burgeoning oil and gas industries’ contribution to state surpluses, the state’s educational fortunes and the improvement in student performance are increasingly tied to the economic output from oil and gas production.
The Senate bill calls for diverting energy-related tax collections in future years in order to grow the fund.