New Mexico Gov. Michelle Lujan Grisham: Permian Basin oil and gas a main driver for policy

Adrian Hedden
Carlsbad Current-Argus

New Mexico Gov. Michelle Lujan Grisham vowed support for the southeast corner of the state as the economic driver to support her numerous legislative priorities during the 2020 session.

Lujan Grisham met with members of the Carlsbad Chamber of Commerce known as the “Bat Brigade” Tuesday at the Roundhouse, discussing the needs of the region and how it fits into her agenda.

She spoke of a boom in oil and gas production in the Permian Basin of southeast New Mexico, and the challenges facing the region alongside unprecedented economic growth.

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An about $1.2 billion budget surplus was predicted for New Mexico in fiscal year 2020, with state leaders crediting the boon to the state’s expansion in extraction operations.

Lujan Grisham touted the opportunities the oil and gas revenue could provide to New Mexico by boosting funding for education and other public services.

Initiatives such as providing free college for New Mexico students, giving raises to teachers or improving childcare was all supported, she said, by the industry’s growth in Carlsbad and southeast New Mexico.

More:Carlsbad leaders demand state support as community struggles to adapt to oil and gas boom

“You guys are an all-of-the-above economy with a lot going on which has incredible opportunity and the state thanks you. It’s literally able to transform education, without which figuring out the next 100 years doesn’t make as much sense,” Lujan Grisham said.

“We have to think about where young people are going to work what they’re going to do; what kind of careers are best. I’m grateful about that, but it has its challenges as well as its rewards. Everything does. You have to balance those things.”

New Mexico Gov. Michelle Lujan Grisham speaks with Carlsbad's Bat Brigade, Feb. 4, 2020 at the Roundhouse.

Lujan Grisham said she was surprised that Eddy County’s unemployment rate was at about 3 percent, well below New Mexico’s average of 4.8 percent and the U.S. rate of 3.6 percent.

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She said she expected the booming southeast region to have rates closer to 2 or even 1 percent unemployment due to the dramatic job growth created by oil and gas industry.

“That’s interestingly high,” Lujan Grisham said. “When you have such incredible economic activity, I would have guessed with everything going on it would have been less than 2.”

Shannon Carr, a Bat Brigade member and communications specialist at Nuclear Waste Partnership explained that many would-be employees in Carlsbad are unable to pass pre-employment drug tests and other requirements, or struggle to attain services such as childcare.

“They are unemployable,” Carr said. “They can’t pass a drug test, they don’t have options for childcare, so they can’t leave home, can’t work.”

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Those were some of the issues Lujan Grisham said she hoped to address in the ongoing 2020 Legislative Session.

She said she hoped to add $50 million more in state funds to the Medicaid system to support behavioral and mental health treatments.

That would mean such expansions as increasing the length of addiction treatment programs and offering more in-patient services for those struggling with mental health.

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“We need residential treatment, we need support for housing. We have to have a whole different long-term model for behavioral health,” Lujan Grisham said. “What we’re learning is that 28-day and 30- and 40-day programs for most folks with an addiction issue is not enough time.

“What I’m learning is that it takes at least 3 years. That requires an investment from the community. If we do it, the studies show that you have a really low recidivism. That will happen. You have my word.”

As for childcare, Lujan Grisham spoke of an ambitious plan to offer universal childcare to all New Mexico parents, to the tune of $400 million.

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She said revenue from the oil and gas industry in the Carlsbad area would be a main driver of such a project that she said could dig New Mexican families out of poverty.

“The goal is to have the kind of economy where we’re saving money, we’re investing money wisely and we can have universal childcare and universal early childhood education. That’s a game changer,” she said.

“That would take us off the poverty rolls in less than one generation, I’m convinced of that.”

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But in exchange for funding her public service initiatives, Eddy County and Carlsbad leaders asked Lujan Grisham to support an essential sector of infrastructure to the oil and gas industry: roads.

“The roads are going to happen faster without being unsafe, but I was shocked to hear that typically road work takes up to 4 years. People are dying are those roads,” Lujan Grisham said. “You’ve got to do it faster and better and wiser, and this community is helping us figure that out.

“Not every community has the ability to help us figure it out or to share resources like we are in the Permian so that we can leverage money in a better way.”

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Eddy County Community Services Director Wes Hooper (left) and Carlsbad City Councilor Jason Shirley attend a meeting with New Mexico Gov. Michelle Lujan Grisham, Feb. 4, 2020 in Santa Fe.

Wes Hooper, director of community services at Eddy County said the County is looking to develop two road bypass loops to direct traffic oilfield traffic around the city to increase safety.

He said the County hoped to get about $25 million from the Legislature for the southeast loop, which was 100 percent designed.

Hooper said the governor’s office contributed $5 million last year to begin construction, but the $39 million project was funded to about $14.7 million.

He also pointed to projects to upgrade U.S. Highway 285, 128 and State Road 31 which were largely funded by state dollars through the New Mexico Department of Transportation.

“We’ve got to get all that major, heavy truck traffic out from the middle of town,” he said. “And get it to go around. We’ve got to be able to keep the industry flowing smoothly down there.”

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Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on Twitter.