New Mexico is moving to universal child care, with lawmakers enshrining into law a program designed to cover the cost for working families across the state regardless of income. The change follows through on promises made by Democratic Gov. Michelle Lujan Grisham, who has said the program is meant to help families manage high child-care expenses while supporting employment.
In the political debate around universal child care, the measure’s backers acknowledged a central tension: expanding eligibility can create new risks for state budgets and can increase the opportunities for fraud or other abuses. The AP reported that other states have pursued variants of similar ideas, including approaches that eliminate or cap copayments or use employer payroll taxes to fund subsidies, but New Mexico’s plan relies heavily on state revenue tied to oil and gas.
New Mexico officials said the program’s financing includes a financial windfall from oil and gas production, including earnings from a recently minted $10 billion trust fund for early childhood education. The AP reported that Gov. Lujan Grisham, wrapping up her tenure next year, described child care as “really a workforce engine” while also framing the policy as a response to the affordability crisis facing families.
As lawmakers completed the legislative session that ended Thursday, they also adopted guardrails they said were intended to ensure the program would be sustainable. State officials said as much as $700 million more would be funneled over the next five years into New Mexico’s child care assistance program, and that copayments were unlikely; any future shift to cost-sharing would require 90-days notice to families.
The law also links funding decisions on possible cost-sharing to new annual reporting requirements. According to the AP report, the early education agency received new authority to monitor how much child care providers pay employees, manage debt and structure their businesses—oversight elements that lawmakers said were meant to reduce fraud risk and help protect public spending.
State Sen. George Muñoz, a cosponsor, said lawmakers seized an opportunity to put those guardrails in place. He said the Legislature did not want New Mexico to end up “like Minnesota,” where federal prosecutors alleged billions in funds were stolen from programs administered for children with autism, addiction services and other needs.
Supporters said the universal approach would put money back into households’ budgets. The AP report included the account of Marianna Eanone of Las Cruces, whose income—combined with her husband’s Army salary—had previously placed her just above the cutoff for child care assistance. She said they had been paying $1,000 a month for a licensed home daycare for their 3-year-old and paying for afterschool care for their kindergartener, and that moving into universal coverage has been “a weight off” because the family no longer had to worry about those expenses.
The policy also attempts to address capacity constraints that can arise when subsidies expand. The New Mexico legislation allows the state to create a waitlist when demand exceeds available slots, and it directs priorities toward children in vulnerable circumstances, including children facing extreme poverty, children with disabilities and children at risk of developmental delays. The AP report also said the policy responds to concerns that expanding assistance to all income brackets could squeeze out slots for low-income families, citing a review by legislative analysts indicating attendance from low-income families declined as assistance expanded to higher income brackets.
Still, leaders said child-care slots remain in short supply across much of the state even as the plan broadens eligibility. The AP report said the measure extends assistance beyond working parents to include grandparent guardians, foster parents and people experiencing homelessness, and it noted that legislators sent a separate bill to Gov. Lujan Grisham to scale up home-based daycare and child care centers by overriding some local zoning and permitting requirements, including homeowner association restrictions. The AP reported that Elizabeth Groginsky, secretary of the early childhood education department, said the legislation left financial breathing room for incentives adopted to improve child care quality, raise base wages and expand operating hours through enhanced rates paid by the state.