Extra $1,200 Stimulus Checks Are Going To 140,000 New Mexicans, Here’s Why

Last week, New Mexico Governor Michelle Lujan Grisham signed into law a $330 million relief bill to help unemployed New Mexicans and certain businesses that have been ravaged by the coronavirus pandemic. Notably, almost $200 million of the aid package will go towards sending one-time $1,200 stimulus checks to all types of unemployed workers in the state.

Here’s why the state passed the relief bill.

New Mexico Sending Stimulus Checks To Unemployed

Most of the money that New Mexico will spend comes from federal relief funding. The state received $1.2 billion in Cares Act funding back in March, but has at least $319 million in unspent funds. Given that the Cares Act money must be spent by December 30, state lawmakers met to formulate a plan for the unspent funds. The result was the $330 million stimulus package passed by New Mexico.

New Mexico’s seasonally adjusted unemployment rate was 8.1 percent in October 2020, significantly above the national average of 6.9 percent. With up to 140,000 New Mexicans unemployed, lawmakers concluded that providing stimulus payments to out-of-work residents was one of the best uses of the Cares Act funding. “I know this stimulus will mean so much to so many New Mexicans as we enter the holiday season,” Governor Lujan Grisham said. “But our work isn’t done. The pandemic has never been more dangerous in our state, and the economic pain caused by the spread of the virus is felt in every corner of New Mexico.”

MORE FROM FORBESSkeptical About $1,200 Second Stimulus Check Odds? Look Local For Emergency Money

Relief Bill Also Provides Other Funding

In addition to stimulus payments to unemployed New Mexicans, the relief bill provides additional benefits including:

  • $100 million in grants for small businesses
  • $15 million towards emergency housing assistance and assistance for the state’s homeless population
  • $10 million to support contact tracing, testing and vaccine distribution efforts
  • $5 million for emergency food bank services
  • $5 million in the form of a one-time $750 payment to residents who were not eligible for a federal stimulus check, including “dependents like children and the elderly, as well as immigrants in the country without legal permission.”

Notable Exclusions In New Mexico Bill

While the bill will help the 140,000 out-of-work New Mexicans, lawmakers voiced concern that the bill unfairly excluded other residents who may also be struggling financially, including low-income and essential workers. “If we’re willing to push the envelope for certain groups of people in New Mexico, why not for the pobres (Spanish for the poor) who clean all of our homes, who clean the groceries stores, who work at the grocery stores. Why not them?”  Jacob Candelaria, a Democratic senator from Albuquerque, told The Associated Press. “If we’re going to push the envelope for somebody, why don’t we finally do it for working people?”

One reason why New Mexico may have limited payments to unemployed residents is to ensure that the state stays within the bounds of the Treasury Department’s guidelines on the use of Cares Act funds. These guidelines included language that allowed expenditures “incurred to respond to second-order effects of the emergency, such as by providing economic support to those suffering from employment or business interruptions due to COVID-19-related business closures.” Therefore, despite lawmakers pushing to expand aid to more workers, the AP noted that Democrats in the state legislature “said federal guidelines would prevent such spending and they promised to find ways during the regular session in January to address the issue.”

New Mexico Follows Other State and Local Stimulus Funding

New Mexico joins other state and local governments who have stepped into the federal stimulus void to provide emergency relief payments and grants to their constituents. In addition to diverting funds towards education, technology and broadband, and workforce development, many allotted or are allotting funds to help residents directly too. Unlike the federal stimulus checks, which were unrestricted in usage, local grants have typically been more limited in scope.

Oregon, North Carolina, and Colorado offered stimulus checks to a subset of residents. Oregon partnered with private sector banks and credit unions to implement a one-time $500 emergency relief payment to qualifying Oregonians. The $500 was an outright grant, not a loan and eligibility required residents to be 18 years or older, have earned $4,000 per month or less prior to their income loss due to Covid-10, have not received all unemployment payments that they were owed, and attest to experiencing financial hardship. 

North Carolina took a different approach disbursing $335 stimulus checks to all households with parents of children 17 and younger to help offset remote learning costs. The state used $440 million from its $903 million CARES Act allotment to fund the stimulus checks.

Colorado began distributing $375 checks earlier this week to roughly 435,000 residents. To be eligible, Coloradans must have received at least one weekly unemployment benefit between $25 and $500 from mid-March when the pandemic began and late October. The funding for the new round of checks came from an executive order signed by Governor Jared Polis that allocated $163 million from Colorado’s general fund.

The Upshot

Tens of thousands of New Mexicans may receive a second stimulus check in December, most valued at $1,200, but some at $750; however, unlike the first one that came from the federal government, the second one will come from the state. Will more states follow?

Further Related Reading:

Skeptical About $1,200 Second Stimulus Check Odds? Look Local For Emergency Money

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