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Why Is New Mexico Exporting One Of Its Top Investments?

Asking the question of why the brain drain exists is a critical step to plugging it.

During the 2022 legislative session, New Mexico passed a major expansion of the Opportunity Scholarship. Despite a two-year period of temporary monetary allocation, the Opportunity Scholarship Act was made permanent when it was signed by Governor Michelle Lujan Grisham on March 4, 2022.

The original scholarship was announced in 2019, but previous iterations of the bills supporting the scholarship failed to obtain requisite momentum and lacked legislative support. Until now.

New Mexico already had a generous Lottery Scholarship program with fairly lenient academic criteria, but those with alternative education backgrounds like former students returning to college are unable to qualify. The Opportunity Scholarship bridges that gap.

The Legislative Finance Committee released a Fiscal Impact Report, estimating a cost likely to exceed a whopping $100 million annually with expectations to grow.

In the future, the scholarship fund itself will require regular replenishment. Specifically, $63 million in funding was approved during the 2022 regular legislative session. This will cover the majority of the scholarship until June 2023, but the one-time financial source will need to be replaced next year.

It is important to note that other student financial aid in the form of Pell Grants and scholarships are applied first. Any remaining balance in tuition and fees is expended from the Opportunity Scholarship.

Also noteworthy is that the scholarship can only be used by students enrolled at public institutions. With the recent United States Supreme Court decision regarding Maine’s taxpayer-funded tuition program, which banned the use of vouchers to attend private religious schools, it is unclear what implications there are for the Opportunity Scholarship.

Setting aside the merits of free college, New Mexico has long suffered from the interstate educational brain drain. While the report is dated, online job aggregator Zippia reported that New Mexico was among the worst performing states for retaining college graduates.

Almost 49% of students leave after acquiring their diploma. By contrast, Texas loses less than 20% of college graduates. This trend continues, and is reflected in a recent KOB poll.

Analyzing the breakdown of the survey results, 47% of New Mexicans aged 18-34 identified that they would be very likely to move away from New Mexico to improve their quality of life. Another 28% reported that they are somewhat likely to leave the state.

Considering this mass exodus of job-seeking educated individuals and the clear indications that this migration is set to continue, if not worsen, this begs the question: why is New Mexico exporting one of its top investments?

Between the Lottery Scholarship and the Opportunity Scholarship, New Mexico is poised to invest over $130 million in higher education in just one year, despite knowing that these same educated people are likely to relocate elsewhere.

Stop the brain drain with a focus on tackling the issues that drive New Mexicans to seek better lives out of state. Restructure the gross receipts tax to end New Mexico’s long-standing tax pyramid scheme and encourage new business development. Stop picking winners and losers with lopsided corporate welfare programs like Spaceport America and the film subsidy. Go after criminals head on, returning some semblance of safety to residents.

And for goodness’ sake, do something about Albuquerque Public Schools and the rest of the state’s dismal public education. Arizona recently adopted the most comprehensive school choice program in the country. New Mexico should do the same. Attracting new families and encouraging existing families to stay with alternative education solutions should be an immediate priority.

But new families will not commit to the land of enchantment without jobs, safety, and education for their children. Jobs will not arrive without needed tax reform and safety for their employees. It is a vicious cycle.

Until such reforms can be delivered, New Mexico will continue to export its most valuable investment. In the end, what might be an opportunity for New Mexico students is turning out to be a huge loss for New Mexico itself.

By Patrick M. Brenner

Patrick Brenner is the founder and president of the Southwest Public Policy Institute, a limited-government research institute and think tank focused on the southwestern United States. An advocate for open government, he leads the institute's government transparency and accountability efforts.

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