Study: Oil and gas accounts for 31.5 percent of NM’s general fund
NEARLY ONE-THIRD: A just-released study shows that 31.5 percent of New Mexico’s general fund is directly related to taxes on the state’s oil and gas industry. New Mexico Watchdog photo.
By Rob Nikolewski │ New Mexico Watchdog
SANTA FE, N.M. — How important is oil and natural gas to New Mexico’s economy? This important: A just-released study shows that nearly one-third of the state’s general fund is derived from the oil and gas industry.
“The results are no big shocker,” said Richard Anklam, president and executive director of the New Mexico Tax Research Institute, which crunched the numbers for fiscal year 2013. ”We just were a little more thorough about it. If anything, the numbers are a little bit conservative.”
Anklam said the data is directly attributable to revenue relating to the oil and natural gas industry and determined that 31.5 percent of the state’s general fund comes from taxes, royalties and fees on the industry.
The institute reported the 31.5 percent figure also applies to funding for public schools and higher education in New Mexico.
Money from the industry also makes up nearly all of the funding for the Land Grant Permanent Fund and the Severance Tax Permanent Fund, both managed by the State Investment Council. The lion’s share of the investment returns from the land grant fund goes to the state’s public schools, while most of the money in the severance tax fund goes to retiring debt from bonds and capital projects:
“What we contribute to the state is outsized, compared to anything we get back,” said Rep. Cathrynn Brown, R-Carlsbad, who represents a district in the heart of the state’s Oil Patch.
The study was commissioned by the New Mexico Oil and Gas Association, which has used the results as part of a marketing campaign called “New Mexico 31” that includes a 30-second commercial spot.
Anklam said his group will receive “between $20,000 to $30,000″ from NMOGA, but insisted that had no influence on the tax institute’s research.
“My job is not to puff the industry,” Anklam said. “It’s a fair question to ask where the money comes from … If you had those kinds of concerns, I would suggest you reproduce the study.”
Click here to look at the entire 325-page report that also includes a breakdown of oil and gas impact in each county.
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