A Market-Based Approach to New Mexico’s Lottery Scholarship Program

(Albuquerque) The Legislature will consider reforming the system during the upcoming 2014 legislative session. Several proposals have been made in the hopes of reforming New Mexico’s Lottery Scholarship program which plays such a large role in financing higher education in the Land of Enchantment.

In its newest paper, “Let’s Really Reform New Mexico’s Lottery Scholarships,” Paul Gessing, president of the Rio Grande Foundation, takes a broader look at the impacts, both positive and negative, of the Lottery Scholarship program and outlines some principles that legislators should adhere to in considering the program’s future. He also offers some approaches that might increase the positive impact of the program both on educational outcomes and New Mexico’s economy as a whole.

The paper includes:

  • A reminder of the tradeoffs and negative impacts of government-sponsored gambling;
  • Analysis of how New Mexico’s Scholarship program results in students “slacking off” in high school;
  • The scholarship discourages students from pursuing scholarships and other funding opportunities for their higher educations;
  • An explanation of why it might not be good public policy to encourage New Mexico’s best high school students to stay in New Mexico; and
  • How the Lottery Scholarship spurs price inflation among New Mexico’s institutes of higher education.

Gessing strongly discourages the Legislature from using General Fund revenues to prop up the Lottery Scholarship Program and cautions against over-emphasizing the use of grades in determining who keeps and who loses their scholarships.

Finally, Gessing encourages the Legislature to consider an innovative voucher-style proposal that, if adopted, would solve several of the problems inherent in the current, flawed model.

A Gessing argues, “The Lottery Scholarship Program has the potential to improve New Mexico’s work force. We believe that a healthy dose of market-based incentives could make limited lottery funds go further without tapping taxpayers for even more spending on higher education.”

New Mexico economy in search of leadership

The year 2012 was a tough one for New Mexico’s economy. Without going through the litany of evidence, our state was the only Western state to be found on United Van Lines’ list of “top-outbound” states. And, while the US as a whole grew by an anemic 2.2% during the year, New Mexico grew by a downright pitiful 0.2%. Texas grew by 4.8%.

As the end of 2013 nears, new data from the Bureau of Labor Statistics indicate that 2013 is not looking to be much better.

According to the report, the state’s labor force participation rate, a measure of how many working-age residents are employed or looking for work, was the fourth-worst in the nation in October. And, between April and October, the state lost 20,382 jobs, or 2.4 percent, and nearly 24,000 labor force participants.

Comparing the Contracts of Presidents at New Mexico’s Two-Year Institutes of Higher Learning

(Albuquerque) New Mexico’s Two-Year Institutes and their leaders have made headlines recently with the termination of President Ana “Cha” Guzmán by the School’s governing board. Regardless of the specific issues at stake, there is no doubt that a new President will be hired at the School.

In the interests of greater transparency, the Rio Grande Foundation has requested and posted online a useful comparison of the salary and benefits packages at the various independent, two-year institutes of higher learning around the state. Actual contract information along with brief analysis and comparison of the compensation packages is available now.

As Rio Grande Foundation President Paul Gessing explained, “When the board enters into negotiations on behalf of taxpayers and the public has a chance to weigh in, we believe that all parties, including the public, should have an understanding of the compensation packages available at similar schools around the state.”

These compensation packages might include a base salary, performance/retention bonuses, a car, a house, retirement contributions, and paid leave.

Each contract is posted below (please note the addendum for New Mexico Junior College)

Central New Mexico Community College (CNM);

Clovis Community College;

Luna Community College;

Mesalands Community College;

New Mexico Junior College plus addendum

New Mexico Military Institute (NMMI);

San Juan College;

Santa Fe Community College;

After a close analysis of each contract, in terms of overall benefits, Gessing concluded, “The presidents of Mesalands, Luna, and NMMI are at the low end of the spectrum compensation-wise. The middle of the pack is represented by San JuanCommunity College and Santa FeCommunity College. The most generous packages are at CNM, Clovis, and New MexicoJunior College. Notably, however, CNM is by far the largest two-year institute in the state with a student population far bigger than any other similar school in the state.”

Keystone XL Pipeline Rally - Albuquerque

Keystone XL Pipeline Rally Invitation

Event Parking Map

2013-12-18 10:30 - 12:00

Gessing on KRQE Channel 13 Discussing Concerns Over Proposed Wi-Fi on Central

Rio Grande Foundation president appeared recently on KRQE Channel 13's newscast to discuss his organization's concerns over Albuquerque Mayor Berry's proposed wi-fi system along Central Ave. Video of the interview can be found below:

Passenger Rail not Worth Big Subsidies it Requires

The tremendous costs of the Rail Runner were outlined in grave detail recently in the Journal. Annual costs are currently about $50 million between operations and payments on the original infrastructure. A portion of these costs are currently being shifted to the federal taxpayer, but there is nothing “sustainable” about the Rail Runner’s long-term finances.

New Mexico taxpayers will face significant additional financial burdens if the Legislature and Governor decide to spend taxpayer dollars to keep both the Rail Runner and federally-owned Amtrak trains heading down the tracks here in New Mexico.

Worse, what Washington gives us in the form of operating subsidies, it can also take away. New federal regulations costing up to $30 million are being imposed by Washington on the entire railroad industry, including the Rail Runner. Those costs which were completely unexpected will be borne directly by New Mexico taxpayers above and beyond the current operating subsidies which themselves come to nearly $20 per passenger, per trip.

Berry's Wi-Fi Proposal Sends Bad Signal

The Rio Grande Foundation has generally supported Mayor Berry’s leadership as Mayor. Obviously, large numbers of Albuquerque voters agree with his fiscally-conservative, personally moderate style of leadership as the Mayor was re-elected with 68 percent of the vote.

Every day mayors and other politicians face the temptation to join the latest fad in the hopes of finding a dramatic way to use government on the theory that expanding government beyond the basics will result in improved economic growth.

Back when Mayor Berry took office, the idea being pushed by some was a new taxpayer-financed events center/arena. Thankfully, we convinced the Mayor not to go down that path which would have significantly worsened our city’s economic condition.

The newest idea is for the City to spend up to $1 million to create a public wi-fi network around Central Avenue. While well-intentioned, municipal wi-fi efforts have a long track record of failure to achieve technical goals (speed and coverage), they also have a long track record of cost overruns.

How Money Walks videos available

Recently, the Rio Grande Foundation recently hosted Travis Brown of How Money Walks for a luncheon talk in Albuquerque. The website which is linked above, is fascinating and easy to use.

Watch Brown's full luncheon presentation here:

Travis Brown of How Money Walks Speaks at Rio Grande Foundation event on November 21, 2013 from Paul Gessing on Vimeo.

Brown also did a shorter interview with Rob Nikolewski of Capitol Report New Mexico:

Signed books are still available for purchase from the Rio Grande Foundation and make great stocking stuffers. Call 505-264-6090 or email us at: info [at] riograndefoundation [dot] org for details.

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