Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance
committees of the Legislature. LFC does not assume responsibility for the accuracy of these reports if they
are used for other purposes.
F I S C A L I M P A C T R E P O R T
SPONSOR Gonzales
/Garratt/Dixon/Brown
LAST UPDATED
ORIGINAL DATE 2/27/25
SHORT TITLE Study Career & Tech Education
BILL
NUMBER House Bill 433
ANALYST Liu
APPROPRIATION*
(dollars in thousands)
FY25 FY26
Recurring or
Nonrecurring
Fund
Affected $100.0 Nonrecurring General Fund
Parentheses ( ) indicate expenditure decreases.
*Amounts reflect most recent analysis of this legislation.
Relates to Senate Bills 64, 130, 343 and 345, and House Bill 560
Relates to appropriations in the HAFC Substitute for House Bills 2&3
Sources of Information
LFC Files
Legislative Education Study Committee (LESC) Files
U.S. Department of Education (USDE)
Agency Analysis Received From
Higher Education Department (HED) Public Education Department (PED) Department of Workforce Solutions (WSD)
SUMMARY
Synopsis of House Bill 433
House Bill 433 (HB433) appropriates $100 thousand from the general fund to the Higher
Education Department (HED) for a study of career and technical education (CTE) courses and
CTE instructors in New Mexico, with a focus on workforce development, and in collaboration
with the Public Education Department (PED), Workforce Solutions Department (WSD), and
Legislative Education Study Committee (LESC). The effective date of this bill is July 1, 2025.
FISCAL IMPLICATIONS
The appropriation of $100 thousand contained in this bill is a nonrecurring expense to the
general fund. Any unexpended or unencumbered balance remaining at the end of FY26 shall
revert to the general fund. Provisions of this bill require involved agencies to study CTE
programs and instructors, which is already a part of the normal operations of the group. As such, House Bill 433 – Page 2
additional costs beyond the $100 thousand appropriation are assumed to be covered within
existing budgets.
SIGNIFICANT ISSUES
The federal Strengthening Career and Technical Education for the 21st Century Act (also known
as Carl D. Perkins V) provides federal funding for CTE programs and activities through the state,
schools, and higher education institutions. In FY25, PED distributed $5.5 million in Carl D.
Perkins V funds to school districts and charter schools. To continue receiving federal Perkins
funding, federal law requires states to maintain the same level of fiscal effort (maintenance of
effort) per student, or in aggregate expenditures statewide, each fiscal year. According to USDE,
in FY23 there were 22.2 thousand secondary CTE concentrators (students who take at least two
courses in a single CTE program pathway) and 21.9 thousand postsecondary CTE concentrators
in New Mexico. That same year, USDE reported 69.9 thousand secondary CTE students and
43.3 thousand postsecondary CTE students in the state.
Despite state law (Subsection E of Section 22-1-12 NMSA 1978) requiring PED to provide
annual reports on the efficacy of the CTE pilot project between FY20 and FY27, PED has not
provided any empirical evidence to date that the state’s CTE pilot project has improved student
academic outcomes. A 2024 LESC inventory of CTE programs notes the pilots require further
study.
A 2024 New Mexico State University survey on PED’s CTE Innovation Zone schools and
activities found school personnel had positive perceptions of the program. The survey did not
include student outcomes or data on student perceptions. The report noted 86 percent of
Innovation Zone schools in FY24 had implemented student internships, serving 2,449 students
with two-thirds of the internships being paid with Innovation Zone funds. Cuba Independent
School District provided the most internships (393) followed closely by Albuquerque Public
Schools (387) and South Valley Academy charter school (310). The top internships were
educational services (276); healthcare and social assistance (264); agriculture, forestry, fishing,
and hunting (162); and construction (138). PED allocated $11.3 million out of the $40 million
CTE appropriation for Innovation Zones across 24 districts, 20 charters, and three tribal schools.
PERFORMANCE IMPLICATIONS
In 2024, PED reported the graduation rate for high school CTE concentrators was 95.8 percent,
significantly higher than the statewide average of 76.7 percent. The higher graduation rate was
higher across student subgroups.
New Mexico leads the nation in associate degrees, certificates, and certifications, but lags the
nation significantly in bachelor’s degree holders. Crucially, younger New Mexicans are less
likely to have postsecondary education than the working-age population as a whole. Fifty-one
percent of New Mexicans ages 25-64 have postsecondary education compared with 54 percent
nationally. However, only 49 percent of New Mexicans ages 25-34 have postsecondary
education versus 56 percent nationwide.
A
ge 25-34 A ges 25-64
Highest Education Level U.S. N.M. U.S. N.M.
Grad/Professional 12% 9% 14% 13% House Bill 433 – Page 3
Bachelor's 28% 19% 23% 17%
Associate 9% 10% 9% 10%
Certificates & Certifications 8% 11% 8% 11%
Some College, No Credential 12% 17% 11% 11%
HS Grad/Credential 24% 27% 25% 26%
No HS Diploma/Credential 7% 8% 10% 12%
Post Secondary 56% 49% 54% 51%
Secondary or Less 44% 51% 46% 49%
Source: Lumina
ADMINISTRATIVE IMPLICATIONS
Provisions of this bill require HED, in collaboration with PED, WSD, and LESC, to study the
availability of CTE courses and instructors, as well as compensation for CTE instructors across
the state. The study must evaluate:
Availability of CTE courses, including:
o Demand for courses,
o Whether courses address skills needed by industry,
o Whether courses address workforce needs,
o Course shortages, and
o Industry employer incentives and issues.
Salaries and compensation of CTE instructors, including:
o Salaries of CTE instructors at community colleges,
o Course loads for instructors,
o Instructor shortages, and
o Comparisons of CTE instructor salaries to other higher education instructors.
The study shall identify root causes for findings, include input from industry employers
(identified by WSD), and recommend short- and long-term actions. HED must provide the study
to the governor, LFC, and other legislative committees on October 1, 2025.
CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP
This bill relates to Senate Bill 64, which creates a school career development success pilot;
relates to Senate Bill 130, which creates a CTE formula factor for public schools; relates to
Senate Bills 343 and 345, which adjusts salary provisions related to vocational teachers; and
House Bill 560, which appropriates $20 million for workforce readiness programs.
The bill likely duplicates or relates to appropriations in the HAFC Substitute for House Bills
2&3, including:
$750 thousand to WSD to identify evidence-based or research-based strategies to
increase the labor force participation rate,
$600 thousand to WSD to implement and evaluate youth pre-apprenticeship programs
targeted toward science, technology, engineering and math industries and programs that
provide a direct pathway to a registered apprenticeship program,
$2.7 million to HED for New Mexico community colleges and regional universities for
program development costs and to purchase equipment supporting noncredit workforce
training programs resulting in industry-recognized certificates or credentials,
$2 million to HED for the expansion of the New Mexico workforce training economic House Bill 433 – Page 4
support pilot program to include students enrolled in department-approved credit-based
and non-credit based workforce development training programs leading to jobs in high
demand industries, and
$40 million to PED for the CTE pilot project.
OTHER SUBSTANT IVE ISSUES
While the state’s labor force participation rate has improved from the pandemic low, New
Mexico’s participation rate in July 2024 was 57.4 percent, the same rate as July 2023. The state
would need an estimated 40 thousand additional individuals between the ages of 20 and 54
working or looking for work to meet the national average. LFC reports have consistently noted
low labor force participation holds the state back from economic development and expansion.
New Mexico’s annual per capita income is $54 thousand, the 46th lowest in the United States in
2023. The state’s ranking has not changed substantially from a decade prior when the state was
48th. Over the last decade, New Mexico’s private employment has grown by 6.8 percent, 6.4
percentage points slower than the western regional average. New Mexico’s economy is more
reliant on retail and government industries, likely contributing to lower wages.
Recognizing the need to increase the skills of the New Mexico labor force, the Legislature has
roughly doubled funding for workforce training programs over the past five years as shown in
the table below:
Summary of Funding for Workforce Development and Training
(in thousands)
Recipient Purpose FY21 FY22 FY23 FY24 FY25
Higher Education
Department
Noncredit workforce training tuition for HEIs - - - - $20,000
Work-study in high-demand degree fields - - $20,000 - -
IET programs - - - - $2,000
IET programs - - - $1,000 $1,000
Noncredit workforce training funds (high skills) $461 $761 $761 $761 $761
Health Care
Authority
New Mexico Works Career Link $4,165 $4,165 $2,748 $2,748 $2,748
New Mexico Works Wage Subsidy $2,000 $2,000 $2,000 $2,000 $2,000
Workforce
Solutions
Department
Trades and career exploration** - - - - $2,000
Youth re-employment and pre-apprenticeships* - - $5,000 - $600
WIOA Title III (Wagner-Peyser) $5,549 $5,550 $5,584 $5,627 $5,589
Registered Apprenticeships
(FY25 reflects HB5)*
$2,000 $2,000 $2,200 $2,500 $7,500
Local Workforce
Dev. Boards
WIOA Title I $36,686 $33,245 $30,243 $36,476 $33,143
Economic
Development
Department
Job Training Incentive Program (JTIP) $9,000 $12,000 $12,000 $9,700 $7,600
Creative industries fund & division - - - $20,000 -
Public Education
Department
NextGen, Innovation Zones, WBL, CTE pilot $2,000 $3,000 $10,000 $20,000 $40,000
Perkins $9,353 $9,727 $10,062 $10,432 $10,518
TOTALS $71,214 $72,448 $100,598 $111,244 $135,459
Misalignment between the state’s workforce skills and industry is a challenge for New Mexico’s House Bill 433 – Page 5
economic future. The state’s target industries generally require advanced skill levels in science,
technology, engineering, and math. Education and job training in New Mexico need to ensure the
state’s workforce has the skills required to meet industry’s needs. Without an aligned workforce,
New Mexico risks exporting residents to states with better connected institutions and losing
employers to states with better trained workers.
Nursing, accounting and auditing, and merchandising were in the highest demand in New
Mexico, but New Mexico lacks sufficient workers with these skillsets. The most common listed
skills by New Mexico workers were strategic planning, business development, and project
management, which are not in high demand by employers. This mismatch of existing skills and
skills wanted by employers could explain rates of underemployment and why companies struggle
to hire employees.
SL/hg/sgs