State and Public School Employee Pay Raise Evaporates in Senate Committee to Cover Cost of Governor’s State Fair Deal
Almost one hundred thousand state employees, public school teachers, school support and transportation employees saw their one percent pay raise evaporate last night in an apparent trade made by Senate leaders and the Governor.
After the Senate passed a measure to fully fund the childcare initiative championed by the Governor Michelle Lujan Grisham and Senate Finance Chair George K. Muñoz, in a meeting of the Senate Finance Committee, committee members instructed budget drafters to strike the compensation increase section of House Bill 2, (the General Appropriations Act voted by the House of Representatives),
According to an explanation from Senate Finance Committee Principal Fiscal Analyst Adrian Avila, the $26 million for state employees was needed to help cover a request from the Governor to add $100 million for apparent improvements and construction of housing at the State Fair grounds in Albuquerque. (The approximate $36.7 million for public school teachers and other school and transportation employees is also being eliminated in the Senate Finance Committee version of the budget bill.)
The executive recommendations for the FY 2027 budget contained two elements, each proposing $100 million appropriations, for a new state fair site selection, property acquisition, and construction; and to the state fairgrounds district board for fairgrounds revitalization projects.
It appears the House did not include either of those appropriations for the Governor’s fairground’s plans, but Muñoz explained that she was intent on getting funding – and inferred she might retaliate by line item vetoing some legislators’ projects if she didn’t get what she wanted.
Senator Michael Padilla, the Majority Whip and member of the Finance Committee, suggested that there were sufficient reserves in spending to address matters that needed attention now versus later.
His effort to convince the other members to move one or two percent from the reserves was rebuffed by Muñoz and a majority of the other members.
The Senate Finance Committee will be taking a look at the final draft, once budget staff formally incorporate the changes members advanced at their meetings of the last few days.
It is expected the final draft will be voted on by the committee and sent to the full Senate for a vote between now and early next week, as the thirty-day session expires at noon on Thursday, February 19, 2026.
The Candle will be providing updates on the budget, as well as and further reporting on the differences in the various budget proposals and the impact of the budget on state programs throughout the weekend.
UPDATE:
(An earlier version of this story under-stated the number of state employees impacted by the decision to eliminate the one percent raise. A more accurate estimation of those employees affected is close to one hundred thousand workers, according to a joint press release issued by the American Federation of State, County, and Municipal Employees Council 18, the Communications Workers of America Local 7076, the National Education Association, and the American Federation of Teachers – New Mexico. The following is a copy of the press release referred to.)
New Mexico’s Public Sector Unions Blast Proposed Elimination of K12, University, and State Employee Raises by Senate Finance Committee
Santa Fe – Connie Derr, Executive Director of American Federation of State, County, and Municipal Employees Council 18, Bethany Jarrell, President of National Education Association – New Mexico, Megan Green, President of Communications Workers of America Local 7076, and Whitney Holland, President of American Federation of Teachers New Mexico released the following joint statement:
“The surprise late night disclosure by Senate Finance Committee Chair George Muñoz that budgeted raises for K-12, higher education, and state workers would be fully cut out of the Fiscal Year ‘27 budget as provided by the House of Representatives is a gut punch to the nearly one hundred thousand workers who we collectively represent.
“This decision seemed to catch other Committee members unaware and was made with little to no time for other members to question or debate this action before Chair Muñoz adjourned the hearing.
“Cutting this raise during this challenging economic environment destroys morale and makes it harder to recruit and retain qualified professionals at a time when stability and experience are urgently needed. Public workers keep our communities functioning, by providing essential services, ensuring public safety, educating our kids, and maintaining critical infrastructure.
“We are educators, police officers, firefighters, bus drivers, nurses, corrections officers, scientists, social workers, custodians, librarians, higher education faculty, CYFD employees, and so many more state workers. We recognize the challenges of balancing a state budget, but those challenges should not be resolved on the backs of the workforce that delivers essential services to the public every day.
“We call on Senate Finance Committee members, State Senate, and House of Representatives leadership to reject this cut and restore the budgeted raise, collectively reaffirming their commitment to the workers who serve our communities with professionalism and dedication.
“Anything less risks long-term damage to the public services New Mexicans rely on.”
