LAS CRUCES – As New Mexico’s state legislature work begins Tuesday, Jan. 17, to allocate an historically large budget — totaling $9.4 billion in recurring spending, an 11.9% increase from the last fiscal year — institutes of higher education around the state will be asking for a piece of that pie.
For New Mexico State University, this will include capital outlay requests from legislators, research and public service projects, continued support for lottery and opportunity scholarships and a sizable injection to boost the university’s online offerings.
Now more than halfway through the current fiscal year, NMSU Chancellor Dan Arvizu said the university is on solid footing and is committed to balancing the budget before the fiscal year ends on June 30.
Enrollment is up. At some campuses throughout the NMSU system, enrollment is approaching or exceeding the pre-pandemic levels last seen in fall 2019. At the main Las Cruces campus, enrollment for the Fall 2022 semester was 14,268; that’s just 28 students shy of the fall 2019 enrollment of 14,296.
Recurring vs. non-recurring costs
Legislative allocations are often viewed in two ways — recurring and non-recurring. Recurring costs are built into the state’s budget and must be spent every year. Non-recurring items are one-time investments, generally made when the state has a surplus of cash to invest in long-term goals.
That’s where New Mexico stands in this year’s legislative session.
But that’s also where the pressure lies to come up with one-time, non-recurring investments that could help improve the lives of residents — and NMSU realizes that. As a result, the university is asking for many more items that will be non-recurring than those that will have to be funded each year. It also continues to explore how investing non-recurring funds in endowments might help bridge that gap.
Arvizu told the Sun-News that he has heard from a number of legislators — including House and Senate leadership — that there isn’t much appetite for adding recurring items to the state’s budget.
“I think what you hear from them is a recognition that, even though these are unprecedented, banner years of resources — primarily coming from oil and gas, it’s not a given that these will be forever,” Arvizu told the Sun-News. “These are volatile revenue streams, and historically, they come and go in cycles. It’s either ‘boom or bust.’ We tend to be in a boom cycle right now.”
Last year, the New Mexico Legislature began exploring endowments, Arvizu said, as a way to turn non-recurring funds into recurring funds. Part of this was a way to invest a large amount of federal monies that simply couldn’t be spent quickly enough, and a dispute between Gov. Michelle Lujan Grisham and the legislature over who had the authority to allocate it.
“How do we turn one-time money into recurring money?” Arvizu said. “We got a generous allocation of endowments last year — something on the order of $36 million, that, essentially you put into a fund. And, with the interest it generates, it throws off recurring money for a very long time.”
However, Arvizu notes that “markets are not static” and endowments are susceptible to those fluctuations in the market.
The COVID-19 pandemic and NMSU Online
“One of the things that the pandemic has given a little more light to is our digital assets,” Arvizu said.
The COVID-19 pandemic changed a lot of things — including the workplace and the workforce. It also changed the way NMSU thought about offering courses. Forced to go 100 percent online in March 2020, and gradually re-integrating in-person courses in recent years, Arvizu said about 20 to 30 percent of students still prefer to take courses online.
“We brought in Dr. Sherry Kollmann, who has been a rock star for us, in turning our digital assets and our online programs into a more major, mainstream part of our university offerings,” Arvizu said. “And it will help us — not just with our pedagogy and our with supporting our students — but it will also help us with our financial stability.”
Kollmann, the university’s associate chancellor for digital learning, said some of the university’s ask would be covered by funding for broadband infrastructure around the state.
“We originally set out to request $27.5 million,” Kollmann said. “One of the things we have learned … is that there is already a bucket of money for about $4 million of that request, due to the broadband initiatives that have been going on. So we’re really seeking about $23.5 million for the expansion of our online environment and our online operation.”
Kollmann said the university’s research showed that more than 330,000 New Mexico residents had some level of higher education, but never completed a degrees or certificates. That was a population that NMSU hopes to reach through its online initiatives.
“That, right from the beginning, has been a market for us — that we want to make sure that we’re educating our own New Mexico residents, throughout the entire state,” Kollmann said.
She added that there are more than 55,000 New Mexico residents enrolled in online programs from universities like Grand Canyon State — an opportunity that NMSU would love the chance to capitalize upon.
NMSU has long struggled with IT infrastructure. When the pandemic set in, it got an injection of federal funding to upgrade its systems — about $50 million — which opened the door to more online students.
“When I first got here — you know, we’re graded by our cybersecurity colleagues,” Arvizu said. “When I first got here, we were graded a ‘D.’ That’s not good. I’m pleased to say that one of the silver linings of the pandemic was that we got a big influx of resources — a lump sum of money from the federal government to help us get through the crisis. One of the things you need is digital assets to do that.”
Noting that a 100 percent remote-learning environment is not the same as a “digital learning” environment, Arvizu said the university was able to acquire the funding it needed to invest in “cyber and cybersecurity.”
As of its most recent cybersecurity evaluation, NMSU scored an “A,” — “no longer a ‘D,’” Arvizu said.
Building NMSU athletics
The NMSU football team will be joining Conference USA in the coming year.
“(That’s) going to improve our revenue production quite significantly,” Arvizu told the Sun-News. “That’ll help us maintain our athletic programs a little more effectively, going forward. We’ve not been able to be in a conference that played football for a few years, and so getting in a conference that plays football is a fairly significant event.”
Arvizu added that it also requires the university to make some investments in its facilities.
“We’ve got a very dilapidated football locker room,” he said. “That’s been on our agenda for a decade or more. And it’s been almost impossible to find the resources to do that.”
The Associated Students of NMSU — the university’s student government — allocated about $15 million in student fees to cover that, Arvizu said. And they were able to do it through reallocation, not raising fees.
NMSU is asking for a total of $4.7 million for the athletics department — some of which would be used for new turf on the football team’s practice fields. The university is also planning for a new scoreboard at Aggie Memorial Stadium.
Listen to the entire interview:
Damien Willis is a Lead Reporter for the Las Cruces Sun News. He can be reached at 575-541-5443, [email protected] or @DamienWillis on Twitter.
Others are reading: