A look into New Mexico's new workforce trust fund

May 20—One of the first bills to make progress in the 2024 legislative session is becoming a reality.

House Bill 5 created New Mexico's new Workforce Development and Apprenticeship Trust Fund. It's a way to consistently channel money to apprentice and training programs in the state, especially as New Mexico continues to receive federal infrastructure dollars.

"It will contribute to the state's ability to continue offering these important resources, for we all know it's vital to our state's economic future," bill sponsor Rep. Joy Garratt, D-Albuquerque, said during the Legislature.

Although the bill went into effect last week, the fund isn't up and running quite yet. The New Mexico State Investment Council will start overseeing it in fiscal year 2025, which starts July 1.

The SIC is responsible for handling and hopefully growing the new trust fund. It will start with a $30 million state appropriation.

The fund has a set spending policy: $5 million for the first two years and $3 million after that, according to the council.

The council estimates that'll let the fund run for about 10 years without any additional appropriations.

The SIC plans to consult with the New Mexico Department of Workforce Solutions, the fund's beneficiary, on asset allocation and risk management.

Distributions from the fund also start in fiscal year 2025. The state plans to transfer $2.5 million from the new trust fund in fiscal years 2025 and 2026 and $1.5 million every year after that to an existing public works apprentice and training fund, handled by the New Mexico Department of Workforce Solutions , to get dollars to apprentice and training programs.

The new trust fund would also send the same amount of money annually to the Department of Workforce Solutions to carry out the Apprenticeship Assistant Act, which aims to help apprenticeship programs develop skilled workers.

Programs not in compliance with approved standards are barred from getting money from the public works and apprentice training fund.

Lawmakers also approved two other new funds this year for the SIC to oversee, also starting in July: the Capital Development and Reserve Fund, which will have up to $500 million initially, and the Higher Education Trust Fund, which will have up to $959 million.

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