Education (Student Financial Aid)

HB 193 creates a scholarship program allowing school tuition organizations to award financial aid to low-income students attending private schools in New Mexico, while establishing tax credits for donors. It directly affects low-income families (defined by federal lunch program income standards) who choose private schools, provided students previously attended a public or home school in New Mexico. Key mechanisms include requiring organizations to allocate 90% of funds to scholarships, prohibiting single-school restrictions, mandating annual financial reports, and requiring audits for organizations receiving $500,000+ in donations. The bill also creates individual and corporate income tax credits for contributions to these scholarship organizations, with strict transparency rules for public reporting.

This House Memorial (HM 28) is a non-binding request to New Mexico's governor, asking them to formally opt the state into the federal Education Freedom Tax Credit program. It does not create new state law but urges the governor to submit an "advance election" to the IRS, allowing New Mexico residents to claim federal tax credits for donations to scholarship organizations supporting K-12 students. The program, enacted by federal law, enables dollar-for-dollar tax credits for charitable contributions to scholarship-granting groups, with no cost to New Mexico’s state budget. The memorial emphasizes that delaying this decision could redirect private donations to other states, potentially reducing educational funding opportunities for New Mexico families.

SB 106 allocates $5 million from New Mexico's general fund to the Higher Education Department for fiscal year 2027 to support graduate scholarships under the Graduate Scholarship Act. This funding directly benefits New Mexico graduate students pursuing advanced degrees by providing financial assistance through the state's scholarship program. The bill specifies that any unspent funds at the end of fiscal year 2027 must return to the general fund. The legislation is currently moving forward after passing committee review in the Senate.