b'2022 Post WPMAEXPO NEW MEXICO Petroleum Marketers Association (NMPMA) ReportNM New Mexico Notes While New Mexicos boom- The states economic outlook is similarly tied to future economic and-bust budget cyclecontinuesstimulus, broader economic movements, and the success inwith steep increases in estimatedfighting COVID-19. The consensus revenue forecast expects FY23 revenues driven by continuedthe New Mexico economy will experience steady but slower record level oil production, a revivedthan national economic growth through the forecast period.natural gas revenue stream, and aAfter reaching the last employment peak in January 2020 strong, broad-based economy (847.9 thousand jobs), employment contracted by 100.5fiscal stability measures the statethousand jobs, or 11.8 percent, by the subsequent quarterimplemented a couple of years ago as a result of the pandemic. By September 2021, preliminary Ruben Bacaare working as planned.data from the University of New Mexico Bureau of Business NMPMA and Economic Research (BBER) and BLS indicates the state Executive Director As reported in the December updatehad recovered 45 percent of the jobs lost from the start of the of the Consensus Revenue Estimating pandemic, with total employment still down 55 thousand jobs Group forecast, unaudited reportsfrom the prepandemic peak.indicate recurring revenues for FY21At the core of New Mexicos fiscal instability has been the were $8.085 billion, up $224.6 significant reliance on volatile revenues from the extractives million, or 2.9 percent, from FY20.industry. Severance taxes and federal royalty payments made Recurring revenues for FY22 areup about 16 percent of general fund revenues in FY21 and are estimated at $8.163 billion, and FY23expected to climb to nearly 20 percent in FY23. Whenrecurring revenues are estimated atincluding gross receipts taxes from Eddy and Lea counties $9.049 billion. New money, or projected recurring revenuesand out-of-state receipts, also highly dependent on oil and gas for the following fiscal year less current year recurring activity, revenue dependent on the extractives industry made up appropriations, is estimated at $1.599 billion for FY23, or 26.3 percent of general fund revenue in FY21 and is expected 21.5 percent growth from the FY22 recurring budget. At theto climb to 31.1 percent in FY23 as oil and gas production time of budget development this fall, over $1 billion of federalsurges in New Mexico. ARPA funds was in dispute over which branch of government controlled the use of this funding. In November 2021, the Of the 3,025 underground storage tank systems at 1,149New Mexico Supreme Court ruled the Legislature should regulated facilities across the state, 95 have outstandingappropriate the funding. The committee budget guidelinesviolations that can threaten groundwater. In the fourth quarter, anticipated and planned for the spending of these funds that,nine facilities cleared significant violations, achieving anwhen combined with surpluses of nonrecurring general fundannual average of 90 percent compliance. However, a very revenue, provide over $2.3 billion in major investments.small number of facilities are actually being inspected. Due to Bolstered by an influx of federal funds supporting individuals,the COVID-19 pandemic, inspections in FY21 were a smallbusinesses, and the state, New Mexico is recovering from thefraction of what they were in FY20. This issue resulted in a pandemic-induced recession in 2020. FY21 revenues camemediocre performance rating on the compliance measurein higher than expected, and future revenues are expecteddespite the program meeting its target. to climb due to projected increases in oil and gas prices and production, growing incomes, strong consumer spending, andUpcoming Eventsrebounding employment. While the vaccine rollout has inspired confidence in economic recovery, the pandemic continues toGood news!Sandia Resort and Casino will be the location affect supply chains, financial markets, and consumer behavior,of the 2022 NMPMA Convention and Trade Show on August and new variants add to uncertainty into the future.22-24, 2022. Please save the date.S48 www.wpma.com / Spring 2022'