New Mexico Kids at the Crossroads

A Children’s Agenda for Making KIDS COUNT with Candidates

kids playing with bubbles Download this children’s agenda (March 2018; 4 pages; pdf)

There’s a reason we call it the Land of Enchantment—everything from our colorful traditions to our diverse cultures and breath-taking landscapes makes New Mexico so special.

But even the most spectacular traditions, cultures, and landscapes can’t make growing up in New Mexico enchanting for children who don’t have the opportunities they need to thrive. With the highest rate of child poverty in the nation, New Mexico is not providing the opportunities our children need to succeed. And if the future isn’t bright for our children, it’s not bright for our state.

But the good news is that we know what works. We have the power to improve opportunities for New Mexico’s kids in a very big way, and we can do it through public policy.

Elections put New Mexico at a crossroads. Will candidates adopt policies that keep us on the current course or will they opt for a path that will lead us to prosperity?

Prosperity is not possible without investments. The best investments we can make are those that build up our people. Investments in people lead to a skilled, educated, and productive workforce, which is essential to a stable business landscape and a strong New Mexico economy.

What follows are recommendations for investments that will put our people first. Fundamental to all of these recommendations is a fair, responsible, and transparent tax system that generates sufficient revenues to support programs and services that can ensure that all New Mexico kids have the opportunity to thrive and succeed.

Economic Well-Being

Children do best when their families have the economic security that comes from having good jobs that pay family-sustaining wages. When there are simply not enough of those jobs to go around or when families fall on hard times, policy-makers can enhance economic security for hard-working families with work supports that help provide the opportunities that children need to thrive. To best support economic well-being for New Mexico’s children, policy-makers can:

    • Increase the Working Families Tax Credit (WFTC) and the Low Income Comprehensive Tax Credit (LICTR).
    • Enact a new state-level Child Tax Credit (CTC) for families with children.
    • Immediately increase the minimum wage to at least $10 an hour, rising to $12 an hour by 2022.
    • Immediately restore child care assistance to the previous eligibility level so more low-wage working parents can afford safe care for their kids.[1] Within two years, increase eligibility even more to help working parents who still struggle with child care costs.[2]
    • Simplify enrollment and recertification processes for family supports including Medicaid, the supplemental nutrition assistance program (SNAP), and child care assistance, as well as enact express-lane eligibility to reduce duplication of paperwork.
    • Enroll all eligible families in Medicaid, SNAP, and child care assistance and increase participation in other work supports.
    • Reject cost-sharing measures and reductions in benefits or income eligibility for Medicaid.
    • Support a maximum APR of 36% on all small loans, and empower the Regulation and Licensing Department to end predatory lending practices in payday, car title, and tax refund loans, and pawn and rent-to-own schemes.
    • Support low-income housing and enact a comprehensive plan to reduce homelessness.
    • Support increased low-income home energy assistance (LIHEAP) funding.

Education

The most effective path out of poverty is education. But when children from low-resource families start school already behind, they are unlikely to catch up. High-quality early care and learning programs are proven to help prepare children for success in school and in life. Policy-makers should ensure equitable access to an affordable and high-quality cradle-to-career system of care and education for all of New Mexico’s kids. To best support education for New Mexico’s children, they can:

    • Significantly increase funding to achieve universal voluntary parent coaching, child care assistance, and pre-kindergarten as part of a comprehensive pre-school early care and learning continuum.
    • Support a constitutional amendment to use a fraction of the Land Grant Permanent Fund for early education.
    • Significantly increase K-12 per-pupil funding and compensation for teachers and support staff.
    • Ensure that schools whose students have the highest needs receive the most funding by increasing the at-risk factor in New Mexico’s education funding formula.
    • Support evidence-based methods for closing achievement gaps at all stages of education.
    • Increase funding for youth mentoring and after-school programs.
    • Expand community schools and other wrap-around strategies and programs that help families and kids.
    • Increase funding for bilingual education to assure that all children have access.
    • Restore the College Affordability Fund so it can support at least $2 million in distributions per year.
    • Make the lottery scholarship need-based.
    • Expand access to education for adults, including high school equivalency programs, service learning opportunities, career pathways for disconnected youth, adult basic education, and English-as-a-second-language (ESL) programs.

Health

A person’s health should not depend on their racial or ethnic heritage or what zip code they live in, but too often it does. Americans value the ideas of equality that are enshrined in our Constitution but, despite the gains made toward universal health coverage, we are still a long way from true health equity. Policy-makers should ensure that all New Mexico children and families have access to a comprehensive and high-quality system of health care coverage and wellness resources, and that all New Mexicans live and thrive in safe and supportive communities. To best support health for New Mexico’s children, they can:

    • Support full implementation of all provisions of the Affordable Care Act to improve access and achieve health equity.
    • Support full-funding of Medicaid for all eligible New Mexicans and oppose barriers to access such as cost-sharing premiums and co-pays for most Medicaid recipients.[3]
    • Re-open the school-based health care centers that were forced to close due to spending cuts and support the creation of more school-based health centers.
    • Support a rebuilding of New Mexico’s behavioral health system with a special emphasis on access to substance abuse treatment programs.
    • Support treatment instead of incarceration for non-violent drug offenders.
    • Develop and fund a plan to end the Medicaid waiting list for those with developmental disabilities.
    • Support common-sense gun safety legislation, including universal background checks and allowing a judge to prohibit those accused of domestic violence from possessing firearms.
    • Increase funding for child and teen suicide prevention, tobacco-use prevention, teen pregnancy prevention, and alcohol and drug prevention programs.
    • Support strategies to move rapidly toward more wind and solar energy, and strategies to reduce harmful emissions from other energy sources.

[1] Those earning up to 200 percent of the federal poverty level, or $41,560 for a family of three.
[2] Those earning up to 250 percent of the federal poverty level, or $51,950 for a family of three.
[3] Those earning less than 200 percent of the federal poverty level, or $41,560 for a family of three.

Download this children’s agenda (March 2018; 4 pages; pdf)

The Medicaid expansion has helped New Mexico’s bottom line

Download this fact sheet (Feb. 2018; 1 page; pdf)

Medicaid-factsheet-bottom-line

Download this fact sheet (Feb. 2018; 1 page; pdf)

Medicaid under threat

Download this fact sheet (updated Aug. 2017; 1 page; pdf)
Medicaid threat analysis-8-11-17 update

Cuts to Medicaid will make New Mexico’s budget problems worse

Download this fact sheet (May 2016; 4 pages; pdf)

Rev4Medicaid-IIThe Problem

The recession was particularly hard on New Mexico, and the state made deep cuts in spending on health care, education, and other essential government services. As our economy began to slowly improve, we began to restore funding to pre-recession levels.

Then, in 2013, lawmakers enacted massive tax cuts for corporations, which, we were told, would bring jobs to New Mexico.

Those tax cuts—along with big tax cuts for the wealthiest New Mexicans, enacted in 2003—have made New Mexico too dependent on revenue from gas and oil extraction.

Rev4Medicaid-IThe Problem, Made Worse

This over-reliance on oil and gas revenue became a serious problem—as it has in the past—when the bottom dropped out of gas and oil prices last year.

Faced with very little new revenue, New Mexico had a choice: raise new revenue by rolling back the ineffective corporate tax cuts or cut spending.

To balance the budget, New Mexico chose to protect tax cuts for corporations and instead to cut the budgets for health care and education—two areas where New Mexico needs to grow, not cut.

Because of the revenue shortfall, the 2017 budget will be millions of dollars lower than the 2016 budget.

Medicaid’s Big Cuts

• Medicaid, which provides health care for those who would otherwise not have it—low-income families and children, the disabled, and elderly—was underfunded by $85 million. Since we’ll lose hundreds of millions in federal matching dollars, the state will need to cut $417 million in health care services.

• Underfunding Medicaid means the state will cut payments to hospitals, doctors, dentists and others at a time when we need to attract and keep providers.

• Some of those Medicaid cuts will adversely impact mental and behavioral health services, which have already been disrupted to a devastating extent.

• New Mexico is also planning to cut Medicaid benefits and enact more co-pays and premiums for low-income families. This means the state is shifting the responsibility for paying for government functions from corporations and the rich onto children, working families, the poor, disabled, and elderly.

Medicaid is part of the solution

Medicaid’s Big Benefits

• Even though the Medicaid program will have to bear the burden of the deepest cuts in the state budget, Medicaid will more than pay for itself through 2020* because of all the jobs and federal money it brings to New Mexico.

• Health care is the only sector growing jobs in New Mexico. But this funding cut could put the brakes on that growth.

While enrollment in Medicaid has grown rapidly, what the state has to spend on Medicaid has not. Medicaid is part of the solution to our budget woes, not a part of the problem.
Rev4Medicaid-III

Raising new revenue: A better way forward

Potential Revenue

A more productive choice would be for New Mexico to raise new revenue to avoid budget cuts and job losses, and position the state for even greater job growth in the future.

There are many ways to raise new revenue and bolster our economy:

Freeze the corporate income tax cuts – The big corporate tax cut of 2013 phases in over 5 years and will cost the state $20 million a year when fully phased-in. We could freeze the corporate tax rates where they are now and save millions during the freeze.

Freeze the tax break for manufacturers – At the same time the corporate income tax rate was cut, we changed the formula (called the Single Sales Factor) for the way manufacturers were taxed, essentially eliminating their tax responsibility. The phase-in could also be frozen so we don’t continue to lose revenue.

Raise the personal income tax rate for those at the top – New Mexico cut the personal income tax rate by nearly half for filers with incomes over $100,000 back in 2003. Not only would raising the rate for this bracket bring in much-needed revenue, but it would make our tax system more fair for low-income families, who currently pay the highest percentage of their income in state and local taxes—thanks, in part, to the 2003 rate cut.

Rev4Medicaid-IV

Raise alcohol and tobacco taxes and include e-cigarettes – These taxes could both increase revenue and act as a deterrent to young people using products that are harmful to their health.

Require all out-of-state corporations to pay income tax on their profits in New Mexico – New Mexico is one of the few states that still allows out-of-state corporations to move their New Mexico profits to another state to avoid paying taxes here. Not only are we losing millions in tax revenue, but this practice is unfair to New Mexico mom and pop businesses that pay their taxes. A partial fix (called Mandatory Combined Reporting) to this was enacted in 2013, but it exempted many profitable corporations such as banks.

Extend the gross receipts tax to more internet sales – Businesses with brick-and-mortar components in New Mexico already pay gross receipts taxes on their internet sales here, but the exemption for those business that don’t still drains a lot of revenue from the state and puts local retailers at a competitive disadvantage.

Reduce or eliminate the capital gains deduction – Enacted in 2003, the capital gains tax deduction slashed in half the amount paid on this unearned income. This means that income from wages is taxed at twice the rate as income from investments. Most of this tax cut goes to New Mexicans earning more than $200,000.

Enact a new tax on diesel fuel – A large portion of this tax would be paid by out-of-state entities like interstate trucking companies.

Enact a temporary increase in the gas tax – While gas prices are low, New Mexico could enact a temporary hike in the taxes we pay at the pump. The tax could be set to automatically sunset if fuel prices rise to a certain level.

Increase the tax on the sale of new motor vehicles – New Mexico’s excise tax on motor vehicles is lower than the general sales tax on most other goods purchased in the state. It’s also lower than in surrounding states, and could stay lower even if this proposal is put into effect.

Decouple from certain federal income tax provisions – When the federal government makes changes to the income tax code, those changes often affect state tax codes unless states take action. New Mexico could decouple from two current federal rules: bonus appreciation and the cancellation of indebtedness provision of the American Reinvestment and Recovery Act; as well as one potential rule: a deduction for domestic production activities.

Enact a health care provider assessment – Instead of facing cuts in Medicaid reimbursement rates, many health care providers would prefer to be assessed a provider fee. The money collected could then be added to the state’s Medicaid budget, allowing the state to draw down the federal matching money.

Require a tax expenditure budget in statute – A tax expenditure budget allows legislators to see the hundreds of tax exemptions, deductions and credits they have enacted over the years. This makes it easier to review tax expenditures for their cost-effectiveness and repeal those that do not grow the economy. While the Taxation and Revenue Department does produce a tax expenditure budget under executive order, requiring one under state law would give legislators more authority over which expenditures are studied.

Require sunset provisions in all tax cuts, exemptions, deductions, and credits – When Congress passes tax cuts, they always include a sunset, meaning they expire after a certain amount of time unless Congress acts to reauthorize them. This allows Congress to evaluate tax cuts and let those that do not have the desired economic impact to expire. New Mexico lawmakers have begun to add sunsets to their tax cuts, but Governor Martinez has been vetoing the sunset provisions. If a sunset was required under statute, the Governor could not veto it.

The Bottom Line

Every year, as we continue to give away much-needed revenue in the form of ineffective tax cuts, New Mexico must revisit this choice: do we protect tax cuts for corporations and the rich and continue to underfund critical services like health care and education or do we raise new revenue and invest in the programs that make New Mexico’s people and economy strong and healthy?

The answer seems obvious: We invest in New Mexico.

*Reports by UNM Bureau for Business and Economic Research and the Legislative Finance Committee

Download this fact sheet (May 2016; 4 pages; pdf)

HSD inefficiencies cost New Mexico money and deny eligible families food and medical assistance

Produced in conjunction with the NM Center on Law and Poverty
Download this fact sheet (Mar. 2016; 4 pages; pdf)

Years out of compliance

For 25 years—since 1991—New Mexico’s Human Services Department (HSD) has been under federal court order to bring the basic processing of medical and food assistance benefits into compliance with federal law.

In just the past three years, the court has entered six orders directing HSD to comply with federal law. Violations included unlawful delays and denials of food and medical assistance to eligible New Mexicans.

In May of 2014, a federal judge found that tens of thousands of New Mexico families were improperly being denied food and medical assistance. HSD was ordered to clear their backlog of cases and to immediately begin complying with the processing standards required by federal law.

The problems were so severe that the court ordered HSD to cease closing or denying cases for “procedural reasons”—meaning for the failure to complete or turn in paperwork and attend an interview—because the Department was still not following procedural requirements.

In December 2015, the New Mexico Center on Law and Poverty reviewed a random sample of case files that the state sought to close due to the applicant or participant’s alleged failure to complete the application or renewal process.

Now, nearly two years later, the review results on the following pages show that HSD continues to violate federal law and the court’s order. Eligible families continue to face illegal delays and denial of benefits.

In a time of state revenue shortfalls, the Department is unnecessarily expending scarce resources on illegal and inefficient processing systems.

Inefficiencies waste money

When inefficient processing results in HSD delaying benefits to eligible families, forcing them to go back through the application process, this is called “churn.” Churn not only disrupts a family’s access to benefits—which can compromise a family’s health and a child’s education—it also creates an unnecessary increase in applications, which costs the state money that could be better spent elsewhere.

Processing an application costs the state double or triple the cost of processing a renewal.1

The Center on Law and Social Policy recently estimated that churn from the Philadelphia County Assistance Office alone costs Pennsylvania almost $9 million annually in needless administrative costs. In addition, the Pennsylvania economy loses out on an estimated $69 million each year due to SNAP benefits lapsing because of churn.2

The population of New Mexico is about 2 million people—larger than the population of Philadelphia County, at 1.56 million.3 Given New Mexico’s larger population, high levels of poverty, and undoubtedly high churn rates, we could be wasting even more money and losing even more economic activity.

Delayed health care benefits

SNAP-Medicaid-Figure I

Case example:

A Hobbs family of four—including a 1-year-old child—was due to have their Medicaid renewed in March 2015. HSD made no attempts to renew the family’s Medicaid with available electronic information. HSD closed the 1-year-old’s Medicaid case in March, leaving the child without medical coverage, and left the rest of the family in a “pending status.” Four months later, in July, HSD sent the family a notice of delay saying that their Medicaid benefits could not be renewed because they had not returned the renewal form, despite the fact that HSD had never sent the renewal notice.

In the same month, the family was sent a notice telling them that they had to provide two months’ worth of paycheck stubs to prove their continued eligibility for Medicaid. One month’s worth of pay stubs is all that is required by law and it is only required if the family has changes in income. The family had reported no changes. After sitting in a pending status for seven months, the family’s case was finally reviewed again in October 2015—seven months later—and the family’s Medicaid coverage was renewed based on information already on file.

SNAP-Medicaid-Figure II

Case example:

A family of two living in Albuquerque applied for Medicaid in March 2015. On the application, the family indicated that they had no income. Rather than checking electronic sources of information to confirm that the family had no income, the Department requested proof from the household.

Notes in the family’s file say that the case could not be processed until the family provided sufficient proof that they had no income—despite the fact that the law prevents HSD from making families prove a negative statement. HSD never sent the family a notice explaining why they had not processed the case. As of December 2015—nine months later—the family was still waiting for Medicaid.

Delayed food assistance benefits

SNAP-Medicaid-Figure III

Case example:

In August 2015, an elderly man from Alamogordo who has no income was due to renew his food stamps. However, HSD failed to send him the required renewal form. When HSD improperly closed his case at the end of August, they also did not send him the legally required notice informing him that his food assistance case was being closed, so he had no idea that he would not receive food assistance in September as he was expecting.

Instead of sending the required renewal form and notice of case closure, HSD sent a notice stating that his food assistance was delayed because HSD was behind in processing his recertification paperwork. This notice was both confusing and incorrect because HSD never received any recertification paperwork from him. After going three weeks without food assistance, the man went to an Income Support Division office to submit a new application for food assistance.

SNAP-Medicaid-Figure IV

Case example:

After experiencing a total loss of household income, an Albuquerque resident applied for food assistance in May 2015. He was eligible for emergency food assistance because he had no income or assets. However, his caseworker improperly denied him emergency food assistance and failed to inform him that he could contest this decision by meeting with a supervisor to explain his situation. Even though interviews must occur within 10 days of the application, his interview was scheduled for one month after he applied. After the month-long delay, he did not appear at the interview.

In June, HSD sent him a notice telling him that his case was delayed because HSD had not finished reviewing his file. This was incorrect. The case was pending because the interview had not taken place. Not knowing that he could simply schedule and complete an interview to finish his application, he ended up waiting for benefits through October of 2015—more than five months after the date of application.

Common-sense steps HSD can take to improve efficiency, save money, and resolve litigation

1. Eliminate requests for unnecessary documents

Federal law precludes states from requiring documents from applicants and participants that are not necessary to determine eligibility. New Mexico’s HSD continues to require documents that are either not necessary to determine eligibility or that the state already has access to through electronic interfaces. These unnecessary requests require significant additional work and often delay and deny critical assistance to eligible families.

2. Make client notices accurate and understandable

HSD reports that 35 percent of decisions to deny or close SNAP are done with incorrect notices.4 Families often receive notices that are confusing and that contain incorrect information about what the family must do to keep their benefits. This is despite the fact that HSD has been under court order to bring its notices into compliance with the law for over two decades. In 2013, the Department began using a new IT system that is capable of implementing the changes required by law, but the changes still have not been made.

3. Automate Medicaid renewals

State agencies must attempt to renew Medicaid for families based on information electronically available whenever possible. This is known as ex parte renewal. Data show that New Mexico does not attempt ex parte renewal before requesting documentation and the completion of forms from families.

Many states automate renewals to eliminate paperwork wherever possible. Medicaid for eligible families can be automatically renewed whenever a family renews or updates their case information to remain enrolled in SNAP, for example. The IT contractor that HSD uses has already programmed automated Medicaid renewals in other states.

4. Create a comprehensive, accurate online worker manual

New Mexico does not have a comprehensive manual for HSD workers to use in processing cases and determining eligibility. Instead, employees are directed to the New Mexico Administrative Code (NMAC) for policy guidance. Unfortunately, the NMAC is neither up-to-date nor easily understandable. In addition, large portions of the NMAC conflict with federal law. Policy memoranda issued by the state are put on a shared drive for workers to access. However, the memoranda are not indexed to the NMAC sections to which they apply. As a result, workers are often not aware of a relevant memo they should be following.

Many states invest in an online worker manual as an effective and up-to-date reference for workers. This helps workers process cases as required by law and in the most efficient manner possible.

5. Collect and share data on enrollment and processing

The strongest measure of the state’s efficiency in processing applications and renewals is the churn rate. Churn happens when eligible individuals lose benefits for a procedural reason—like the failure to turn in paperwork or attend an interview—only to reapply for the same benefits shortly thereafter. Churn creates an unnecessary increase in applications, which are more costly to process than renewals.

Measuring and reducing churn would position New Mexico to use its limited resources more efficiently to improve the timeliness and accuracy of eligibility determinations and demonstrate compliance with court orders.

Endnotes

1. “Understanding the Rates, Causes, and Costs of Churning in the Supplemental Nutrition Assistance Program,” USDA, November 2014
2. “Churn Hurts Clients, DHS Caseloads, and Pennsylvania’s Economy,” Center on Law and Social Policy, January 2015
3. US Census QuickFacts, 2014
4. General Information Memorandum ISD-GI 16-22, HSD, March 1, 2016; http://www.hsd.state.nm.us/uploads/files/Looking For Information/General Information/Procedures/ISD – GIs/GI 16-22 First FFY 2016 SNAP Performance Report.pdf

Produced in conjunction with the NM Center on Law and Poverty
Download this fact sheet (Mar. 2016; 4 pages; pdf)

Helping Food-Insecure Households in New Mexico Afford Healthier Choices through the SNAP Double Up Food Bucks Program

Download this policy brief (Jan. 2016; 8 pages; pdf)

New Mexico is a poor state with high rates of food insecurity and with too many adults and children suffering from nutrition-related chronic conditions, including obesity and diabetes. Programs that incentivize consumption of locally grown, healthy, fresh produce to food-insecure individuals offer both health benefits to low-income communities as well as economic benefits to local farmers.

One example of a healthy food incentive program is Double Up Food Bucks (DUFB), which allows SNAP (Supplemental Nutrition Assistance Program) recipients to double their purchases of fresh, locally grown produce when they shop at participating farmers’ markets. This helps qualifying households access more food at no extra cost and eat more locally grown, fresh fruits and vegetables while creating demand for such produce and circulating more money in the local economy. Programs like SNAP DUFB—that generate a win-win for vulnerable New Mexicans as well as local farmers—should continue to be supported and be expanded throughout New Mexico.

SNAP-DUFB-Figure ILow-income status and food insecurity

In New Mexico, 21 percent of the total population, and 30 percent of our children live at or below the federal poverty level—$19,790 for a family of three (see Figure I). This places New Mexico second highest in overall poverty and highest in child poverty nationwide.1 Many New Mexico families are working hard despite the slow statewide economic recovery but 42 percent of our working families are low-income, meaning they earn less than 200 percent of the poverty level2 (see Figure II). Racial and ethnic minorities are more likely than whites to live in poverty or earn low incomes (see Figure III).

SNAP-DUFB-Figure II
SNAP-DUFB-Figure III

Low-income families are more likely to suffer from food insecurity3 and they have to spend a much larger portion of their income on food purchases than middle- or upper-income families. On average, the lowest 20 percent of households spends 26 percent of their income on food purchases, while the highest income earners spend only 3 percent (see Figure IV). Food insecurity affects 17 percent of New Mexico’s entire population and 28 percent of New Mexico’s children4 (see Figure V). New Mexico ranks eighth in the U.S. in overall food insecurity and third in child food insecurity.5 Of the more than 70,000 hungry New Mexicans who seek food assistance every week, between 30 and 40 percent are children and 21 percent are seniors over the age of 60.6

SNAP-DUFB-Figure IV

SNAP-DUFB-Figure VFood insecurity and poor nutrition

Eating healthy is expensive. A recent study showed that the cost of a healthy diet is $1.50 more per person per day than the cost of an unhealthy diet. While this seems small, it translates into big barriers for healthy eating when you consider that a family of four would have to pay an additional $2,200 per year on top of their existing grocery bills to provide a healthy diet.7 It is not surprising then that low-income families with tight food budgets often buy more processed foods because these foods are usually cheaper and have longer shelf lives than healthier, less processed foods.8 A survey done by the New Mexico Association of Food Banks found that 75 percent of food bank customers reported purchasing inexpensive, unhealthy food as the most common way to have at least some food at home to eat.9 Recently conducted focus groups with SNAP-eligible low-income community members in New Mexico found that this was indeed the situation for many of the participants. One community member from McKinley County shared that “I want to eat better, I want to be healthier, but I can’t afford it…” while another community member from Albuquerque mentioned that “(My son) gets a lot of not-great-for-him foods, just to make sure he’s getting enough to eat.”10

Poor nutrition and chronic health conditions

The strong link between food insecurity and obesity can be counter-intuitive but studies show that cost constraints often force low-income individuals to decrease their intake of more costly lean meats, dairy and fresh produce while increasing their intake of cheaper and more satiating foods containing processed grains and added sugar and fats.11 In addition to obesity, food-insecure individuals with poor nutrition are more likely to have chronic conditions such as diabetes and cardiovascular illnesses.12

Racial and ethnic minorities in New Mexico, who are more likely than non-Hispanic whites to be poor or low-income, are also more likely to suffer from a variety of nutrition-related chronic health conditions (see Figure VI). Economic and health statistics showcase the need for increased funding for programs like SNAP DUFB that help low-income individuals have access to healthier foods, particularly fresh produce.

SNAP-DUFB-Figure VI

SNAP Double Up Food Bucks increases access to affordable fresh produce

In 2014, SNAP benefits helped partially cover food expenses for 431,000 very low-income New Mexicans (or 21 percent of the state’s population compared with 15 percent nationwide), with an average monthly benefit per person in New Mexico of $121.13 An estimated 88 percent of New Mexico SNAP households are poor (below 100 percent of the poverty line) and 45 percent are in deep poverty (below 50 percent of the poverty line). Additionally, the majority of SNAP beneficiaries (63 percent) in the state are children, or elderly or disabled adults (see Figure VII)—in other words, people with high nutrition needs.14 Unfortunately, the state is considering reinstating work rules that go beyond the requirements mandated by the federal government. These new rules would require individuals between 16 and 59 years of age, including parents with children older than 12, to work in order to access SNAP benefits. Those unable to find employment would be required to participate in many hours of volunteering or job training just to get the nutrition assistance.

SNAP-DUFB-Figure VII

Although the state is looking to reduce SNAP enrollment numbers, the Legislature in 2015 appropriated $400,000 for the SNAP DUFB program to enable SNAP recipients to match their SNAP benefits one-to-one at participating farmers’ markets across the state. Programs that promote the consumption of fresh produce are needed in New Mexico where only 18 percent of adults and 21 percent of children and teens eat the recommended five or more fruit and vegetable servings per day.15 Additionally, too many areas in New Mexico are considered food deserts without ready access to fresh, healthy, and affordable food.16 The state ranked ninth in the rate of difficulty accessing affordable fresh fruits and vegetables (2008-2010) in both households with children and in all households. Urban areas are also affected, with Albuquerque ranking fourth among 100 U.S. metro areas for the highest rate of difficulty accessing affordable fresh fruits and vegetables in households with children and 13th in all households.17

SNAP Double Up Food Bucks creates demand for locally grown produce

SNAP benefits not only improve food security but also directly added $630 million to the New Mexico economy in 2014.18 The economic multiplier is strong: The USDA estimates that every $5 spent in SNAP benefits generate $9 in local economic activity.19 With the SNAP DUFB program, more SNAP beneficiaries shop at farmers’ markets for healthy produce and more of the economic stimulus benefits local farmers and other New Mexico food producers. The New Mexico Farmers’ Marketing Association reports that 2015 sales significantly increased at most farmers’ markets that offered the program.20 SNAP sales at farmers’ markets went from $128,000 in 2014, when the DUFB program was locally funded in a handful of farmers’ markets, to more than $350,000 in 2015, when a combination of federal and state funds spurred the expansion of the DUFB program to 34 farmers’ markets and two farm stands in 20 counties across the state. This 175 percent increase in SNAP sales was welcomed by local farmers, many of whom say they plan to expand farming operations due to increased demand. Counties with high food insecurity or SNAP participation rates that received large boosts in SNAP sales in 2015 through the DUFB program included Socorro, San Miguel, San Juan, Sierra, Rio Arriba, and Taos.

The New Mexico Farmers’ Marketing Association is currently compiling survey data for the New Mexico DUFB program but evaluations of similar SNAP voucher and coupon programs at farmers’ markets across the U.S. have shown that SNAP transactions usually double and can even quadruple.21 In surveys done in other states, 78 percent of vendors shared that they had more repeat customers because of the program and managers of farmers’ markets reported that DUFB programs brought in new and more diverse customers.22 Looking at SNAP recipient feedback, more than 75 percent shared that DUFB was a strong incentive to shop at farmers’ markets and that they increased their purchase of fruits and vegetables as a result.23 Almost half of New Mexico’s farmers’ markets are already participating in the DUFB program (see Figure VIII) but additional funding, support, and outreach could make this program truly statewide.

SNAP-DUFB-Figure VIII

Policy recommendations

Support and expand SNAP DUFB. New Mexico’s farmers’ markets currently generate around $9 million in annual sales, according to the New Mexico Farmers’ Marketing Association. Those participating in DUFB in 2015 earned more than $350,000 in combined SNAP and SNAP DUFB sales. By 2016, more than half of all farmers’ markets will be participating in the DUFB program. Expanding the program to more farmers’ markets (including those in food insecure counties like Torrance, Lea and Chaves), to farm stands and co-op grocers will help increase access to healthy, nutritious foods for food-insecure New Mexicans while increasing demand for locally grown produce. Since SNAP DUFB state funding will likely leverage matching federal USDA funds, future recurring state funds should bring an additional $2 million in federal funds into the state during the next four years.

Increase participation in SNAP DUFB. Barriers to SNAP DUFB participation include insufficient access to information about the program; limited hours and locations of farmers’ markets; misconceptions around actual and perceived prices; inability to do bulk or one-stop shopping; unfamiliarity with how to prepare less-common produce; and limited marketing budgets that make it difficult to reach broad target audiences. Strategies for improving SNAP DUFB participation include: promoting the program directly to SNAP participants through the New Mexico Human Services Department; increasing training and outreach to statewide Income Support Division personnel who work directly with SNAP participants; increasing the administrative capacity of farmers’ markets staff and volunteers to run the program; conducting cultural competency training to increase the capacity of farmers’ market staff and volunteers to engage with, and better serve, diverse audiences; increasing the production and distribution of locally grown food to corner stores and other grocery stores so SNAP DUFB is available at more retail outlets; creating additional marketing materials (and translate into Spanish) that can be more widely disseminated in libraries, banks, post offices, DMV locations, child care sites, and schools; conducting more outreach via cooking demos on site and other community locations; leveraging SNAP-Ed funding to further crosslink nutritional education efforts; and working with health professionals to spread the word about the program.24

Support a variation of the Fruit and Vegetable Prescription (FVRx) program using SNAP DUFB funding. In FVRx programs, enrolled patients with nutrition-related illnesses receive nutritional counseling as well as “prescriptions” for no-cost fresh fruits and vegetables redeemable at participating farmers’ markets. A new pilot program created by the New Mexico Farmers’ Marketing Association called SNAP Rx will pair such a program at three federally qualified health clinics in Northern New Mexico with the existing funding and infrastructure of SNAP DUFB. This promising and innovative program should help foster partnerships between health care providers and low-income individuals dealing with diet-related illnesses while improving health outcomes of at-risk populations and further increasing the demand for locally grown fresh produce. Upon successful pilot implementation, the SNAP Rx program should be expanded across the state.

Increase funding for the New Mexico Grown Fresh Fruits and Vegetables for Schools Meals program. In 2015, with $364,300 of recurring state funding from the Legislature, more than 30 farms looking to expand their businesses participated in this program to provide locally grown fresh produce to as many as 218 School Food Authorities and school districts across the state, according to Farm to Table NM. For many food-insecure children, their school meals end up being their main meals of the day and providing nutritious foods that include locally grown fresh produce help improve children’s health while creating demand for locally grown produce. This funding also helps schools align with new federal school nutrition rules that now require twice as many servings of fresh fruits and vegetables in school meals.

Optimize and streamline SNAP enrollment. The state should take full advantage of federal SNAP offerings including: drawing down all available SNAP outreach dollars for increasing SNAP participation; continuing the federal exemptions from work requirements; eliminating excessive and administratively burdensome verification requirements; and implementing “express-lane” enrollment to link SNAP, Medicaid, and child care assistance. As mentioned earlier in the brief, every $5 spent in SNAP benefits generate $9 in local economic activity. This leads to a very positive economic multiplier effect for communities across New Mexico while increasing the food security and health outcomes of vulnerable children and adults in the state.

Endnotes

1 U.S. Census Bureau, 2014
2 Working Poor Families Project analysis of 2013 U.S. Census American Community Survey data
3 Hunger in America, 2014, Feeding America, 2014
4 Ibid
5 Map the Meal Gap, Feeding America, 2015 (2013 data)
6 Hunger in New Mexico, New Mexico Association of Food Banks
7 “Off the Cuff: The $1.50 Difference,” Harvard School of Public Health Magazine, 2014
8 “Poverty and Obesity: The role of energy density and energy costs,” The American Journal of Clinical Nutrition, 2004; and “Obesity, diets, and social inequalities,” Nutrition Reviews, 2009
9 Missing Meals in New Mexico, NM Association of Food Banks, 2010
10 A Health Impact Assessment of a Food Tax in New Mexico, New Mexico Voices for Children, 2015
11 “A cost constraint alone has adverse effects on food selection and nutrient density: An analysis of human diets by linear programming,” The Journal of Nutrition, 2002
12 “Food insecurity is associated with diabetes mellitus: Results from the National Health Examination and Nutrition Examination Survey (NHANES) 1999–2002,” Journal of General Internal Medicine, 2007; and “Food insecurity is associated with chronic disease among low-income NHANES participants,” The Journal of Nutrition, 2010
13 USDA SNAP state activity report, FY 2014
14 Center on Budget and Policy Priorities analysis of data from USDA food and nutrition services, FY 2013
15 NM Youth Risk and Resiliency statewide survey, NM Department of Health, IBIS, 2007, 2009, 2011 compiled data; https://ibis.health.state.nm.us/query/builder/yrrs/YRRS3_PENutriWgt/5aDay.html
16 “Food Access Research Atlas Data File,” U.S. Dept. of Agriculture, Economic Research Service, August 2015
17 A Half Empty Plate: Fruit and Vegetable Affordability and Access Challenges in America, Food Research and Action Center (FRAC), 2011
18 NM SNAP Fact Sheet, Center on Budget and Policy Priorities, 2015
19 The Food Assistance National Input-Output Multiplier Model and the Stimulus Effects of SNAP, 2010
20 NM Farmers’ Marketing Association 2015 report to the New Mexico Legislature
21 Double Value Coupon Program Diet and Shopping Behavior Study, Wholesome Wave, 2012
22 Double Up Food Bucks 2011 evaluation, Fair Food Network Project
23 SNAP Healthy Food Incentives Cluster Evaluation, 2013 Final Report, Community Science
24 Exploring Efforts to Increase Participation of SNAP Recipients at Farmers’ Markets, Emory University, 2015

Download this policy brief (Jan. 2016; 8 pages; pdf)

A Health Impact Assessment of a Food Tax in New Mexico

An analysis of the taxation of grocery purchases and its impacts on the health of the state’s children, families, and communities

HIA report-cover
Download this executive summary (Nov. 2015; 12 pages; pdf)
Download the full report and appendix (Nov. 2015; 94 pages; pdf)
Link to the press release

Executive Summary

This document summarizes findings from a health impact assessment (HIA) that was conducted in 2014 and 2015 on the potential health impacts of a reinstatement of a tax on grocery purchases in New Mexico. This HIA report is intended to be an accessible and informative resource for New Mexico residents and policy makers (at both the state and local level) interested in the issue of taxing food in New Mexico. The report is intended to inform the decision-making process by describing the potential positive and negative health impacts that could result from a tax on food.

The New Mexico Voices for Children HIA team also recognizes that other state and local governments have considered or may in the future address food taxes, and it is hoped that this HIA may be of value to decision makers and stakeholders in those areas as well. In a broader sense, the framework of this HIA—examining how tax policy can affect health—should be a relevant basis on which to consider “health in all” policies and the health impacts of other tax and economic policy decisions, both in and outside of New Mexico.

Acknowledgements

This project was supported by a grant from the Health Impact Project, a collaboration of the Robert Wood Johnson Foundation and The Pew Charitable Trusts. Over the course of the project, the New Mexico Voices for Children’s (NMVC) health impact assessment team received valuable input and participation from a variety of stakeholders, including community members, nonprofit and faith leaders, food bank and food pantry employees, researchers, academics, government officials, and public health experts. We thank them for their willingness to share their valuable time and significant experiences for the benefit of the project.

We extend special thanks and deep gratitude to the stakeholders who served on the HIA Advisory Council (see Appendix A in the full HIA report for a complete list of Advisory Council members). These experts brought an incredible body of knowledge, passion, and expertise to the project, and they were crucial to its execution. We also wish to thank Kari Bachman, M.A., with Doña Ana Place Matters, Jordon Johnson, Ph.D. with McKinley Community Place Matters, Rodrigo Rodriguez with the SouthWest Organizing Project, and Janet Page-Reeves, Ph.D., with the Department of Family and Community Medicine at the University of New Mexico Health Sciences Center. Their input and expertise was critical to conducting focus group research and gathering community feedback on the possible health impacts of a tax on food.

This HIA would not have been possible without the guidance and support of Amber Lenhart, M.P.H., of the Health Impact Project; Tia Henderson, Ph.D. and M.S.T., and Heidi Guenin, M.U.R.P. and M.P.H. of Upstream Public Health; and Mandy Green, M.P.H. of Green Health Consulting.

Disclaimer

The authors of this report are responsible for the facts and accuracy of the information presented. The views expressed are those of the authors and do not necessarily reflect the views of the Food Tax HIA Advisory Council, the Health Impact Project, The Pew Charitable Trusts or the Robert Wood Johnson Foundation.

Project Background

In October of 2014, New Mexico Voices for Children (NMVC) received funding from the Health Impact Project—a collaboration of the Robert Wood Johnson Foundation and The Pew Charitable Trusts—to conduct a health impact assessment (HIA) on the possible reinstatement of a tax on food purchased for consumption at home in New Mexico. A health impact assessment is defined as “a systematic process that uses an array of data sources and analytic methods and considers input from stakeholders to determine the potential effects of a proposed policy, plan, program or project on the health of a population and the distribution of those effects within the population. HIA provides recommendations on monitoring and managing those effects.”1

In considering the value of an HIA on a food tax, the NMVC HIA team first noted that public health—or the consideration of how community health is supported, or at risk, before anyone feels sick and needs to visit the doctor—was not part of the discussion on the issue. While NMVC had previously engaged in policy work and research on the food tax, the staff had not examined how it could potentially impact health. The NMVC HIA team then considered and gathered stakeholder and expert input on the existing health conditions in New Mexico as well as how these health conditions might be impacted by a tax on food.

After consulting with stakeholders and considering the decision to be made and the current debate around the issue, the NMVC staff determined that the possible health impacts of a reinstatement of a tax on food might not be considered unless an HIA on the topic was done. The decision to conduct an HIA was also strongly influenced by the likely timeline of the introduction and discussion of a bill to tax food, its potential impacts on family economic security and health outcomes, the intersection of health and tax policy, and the background and policy expertise among NMVC staff and partners in these areas.

Food Tax HIA Goals

    1. Inform public opinion and government decisions on the potential health impacts of food tax policy;
    2. Ensure that any potential health impacts of a food tax are rigorously evaluated and considered when decisions related to food taxation are being made;
    3. Demonstrate the policy’s health impacts on particularly vulnerable groups, as well as to engage these groups and help build advocacy resources for them;
    4. Demonstrate how tax, economic, and budgetary policies can impact health outcomes;
    5. Create new and/or strengthen ongoing partnerships between health and non-health groups; and
    6. Increase organizational, partner, government, and community capacity to conduct and use HIAs.

The development of the scope of the HIA, as well as the HIA process, were driven by the accepted values of democracy, equity, ethical use of evidence, and a comprehensive approach to health that underpin HIA.2

HIA Methodology

HIA is defined as “a systematic process that uses an array of data sources and analytic methods and considers input from stakeholders to determine the potential effects of a proposed policy, plan, program or project on the health of a population and the distribution of those effects within the population. HIA provides recommendations on monitoring and managing those effects.”3

An HIA is conducted in six primary stages: screening, scoping, assessment, recommendations, reporting, and monitoring/evaluation. Stakeholder engagement is essential to and happens in every stage of the HIA process. The steps of an HIA4 are outlined in Figure I.

HIA stepsFood Tax HIA Research Methods

This health impact assessment relied on five primary research methods to identify and evaluate the potential health impacts of reinstating a tax on food: 1) literature review, 2) evaluation of existing conditions, 3) quantitative data analysis, 4) key stakeholder interviews, and 5) focus groups. A full discussion of the findings, methods, and data sources can be found in the full HIA report.

History of the Food Tax in New Mexico

Prior to 2004, New Mexico taxed food that was purchased for consumption at home under the state’s gross receipts tax (GRT), the state’s version of a sales tax. In 2004, the state Legislature exempted food groceries from the GRT. (Food purchased from restaurants is still taxed, as are non-food groceries such as paper products.) The legislation contained a “hold-harmless” provision whereby the state would compensate cities and counties for their portion of the revenue lost from this new exemption. Over time the value of the exemption grew to be approximately $250 million per year—much more than was originally estimated.

In 2013, a new law was enacted that phased out the hold-harmless payments over a 15-year period. This was done to offset the cost of a major corporate income tax cut. This new law also allowed cities and counties to recoup the loss of the hold-harmless revenue by imposing small increments of the local GRT. However, many local governments are faced with declining revenues, and many local officials have resisted raising their GRT rates. In 2014, some local government officials called for legislation to allow local governments the option to tax food. Since then, multiple bill versions have been discussed that include a reinstatement of a tax on food.

Policy Alternatives

State legislators—under pressure from the local governments faced with declining revenues as well as lawmakers wishing to overhaul the state’s entire tax system—are now considering reinstating a tax on food. New Mexico policy makers have drafted, proposed, and/or discussed multiple bills that would reinstate the GRT on food. Recently proposed legislation has included two options. The tax overhaul proposal would add food to the tax base and eliminate many other deductions and exemptions in order to reduce the total GRT rate on all goods and services. A second proposal would allow cities and counties to tax food but would not apply state-level taxes. Some cities and counties have also advocated for a referendum that would allow voters in each constituency to decide whether to tax food.

HIA-Portrait of NM

While conducting the HIA, the HIA team focused only on the food tax component of proposed legislation and the health impacts that could result from any new tax on food. The non-food-tax components of the bills seeking to overhaul the tax system differ from tax package to tax package to the extent that it is not possible under current time and resource restraints to thoroughly evaluate the health impacts of each different tax package comprehensively. These components were considered, however, but only generally for contextual purposes and specifically for the Secondary Policy Recommendations section of this report.

HIA-State food tax policies

Timeline for the Decision-Making Process and the HIA

A bill to reinstate the food tax could be introduced and passed by state legislators—and either signed or vetoed by the Governor—as early as the 2016 legislative session. The bill could be written so that food could be taxed by the state as soon as mid-2016. If a bill to give local governments the option to reinstate a food tax is enacted, local governments could begin formally considering the tax under a timeline determined by state law and by each local government, though those laws would not likely go into effect until 2017 at the earliest.

Health Determinants Related to a Tax on Food

Health determinants are any factors that contribute to a person’s state of health and can include income, access to transportation and healthy food, neighborhood safety, etc. According to the World Health Organization, social determinants of health are “the complex, integrated, and overlapping social structures and economic systems that are responsible for most health inequities. Social determinants of health are shaped by the distribution of money, power, and resources throughout local communities, nations, and the world.”5 Health determinants shape the places in which people are born, learn, grow, work, and live, and are key influences on peoples’ health throughout their lives.

If a tax on food is reinstated, three things could happen that could have a strong influence on health determinants that impact health in New Mexico. The cost of purchasing food would increase for most grocery purchases, changing the economic security of families, particularly those with low incomes. Households have a limited amount of money in their budget; if a food tax emerges, households have to decide where that extra money to pay a tax would come from. Households would either:

    1. Maintain their current food purchasing patterns, which would mean increasing the amount of money they spend on food and decreasing spending in other budget areas, or
    2. Maintain their current food budget, which would require them to change their spending habits on food by buying less food or buying lower-cost food.

At the same time, a food tax would cause government revenues to increase, which would change government spending (either directly or indirectly through other changes to the tax code). This means governments could:

    3. Be able to maintain current service levels (in the case of municipalities that are facing budgetary shortfalls), or could increase spending for current programs, create new programs, cut other taxes, or reduce tax rates (the latter being the case with a state-level tax system overhaul).

From these outcomes and the logic outlined above, and based on community, Advisory Council, and key stakeholder input, as well as on a preliminary review of existing literature, NMVC selected the following three health determinant logical pathways for further study:

  1. Family Economic Security: Non-Food Living Expenses
  2. Family Economic Security: Food Insecurity, Diet, and Nutrition
  3. Direct Government Spending: Maintaining Current Services

HIA-Summary diagram

Potentially Vulnerable Populations

A core tenet of HIA is to consider health equity, highlight health disparities, and systematically evaluate health impacts of a potential project, program, or policy (in this case, a tax on food) on particularly vulnerable populations that may be disproportionately affected by a policy or face harmful health effects at greater rates or more detrimental levels.6 When available, data were disaggregated by population characteristics including, but not limited to age, gender, income, place of residence, and race or ethnicity whenever data or research was available in order to best understand the health impacts that a change in food tax policy would have on the following populations that were identified by the HIA project team and Advisory Council as particularly vulnerable:

  1. Children
  2. People of color
  3. Low- and lower middle-income families and individuals

The potential health effects on elderly New Mexicans (adults ages 65 and older), residents of rural areas, and residents of food deserts (places without reliable access to affordable sources of healthy food) were also analyzed when possible.

Overall Assessment Findings

Reinstating a tax on food in New Mexico may affect several health factors. The analysis conducted as part of this HIA through a literature review and both quantitative and qualitative research suggests that implementing a food tax is likely to have an overall negative impact on health through multiple health factors; while there are some potentially positive health impacts that could result, these are less likely. A full discussion of the findings, methods, and data sources can be found in the full HIA report.

Health Impacts of a Food Tax on Family Economic Security: Taxing food would cost each New Mexico household around $350 per year, or $29 per month, on average. Highest-income earners in New Mexico would spend about one-half of 1 percent of their income on a food tax, while the lower half of New Mexico earners would spend around 1 percent of their income on the food tax alone—double the rate that high earners would pay. Research and calculations show that a food tax would exacerbate the tax system’s regressivity—that is, it would hit low-income earners harder than it would hit high- income earners—and could harm family economic security, which could have negative impacts on mental health and stress levels, income available for other necessary purchases besides food, need and demand for public assistance, childhood development, ability to pay for health services and medicine, economic equity, and the ability to manage chronic conditions through diet.

Health Impacts of a Food Tax on Food Security, Diet, and Nutrition: Taxing food could also have an adverse impact on food security, diet, and nutrition by prompting purchases of less food or cheaper, less nutritious food. This could have important and harmful implications for health, particularly nutrition-related chronic conditions, the ability to manage chronic conditions through diet, childhood development and learning capacity, malnutrition issues, the incidence of low birth-weight and/or preterm babies, and the need and demand for food assistance from public, private, and nonprofit sources.

Health Impacts of a Food Tax on Government Spending: It is also possible that the negative health impacts of taxing food could be mitigated by how that revenue is spent. If food tax revenues lead to overall increased government spending on direct health services, food assistance and nutrition programs, programs that provide recreational opportunities, and education, then the food tax could have positive implications for health, or at the very least have no net negative implications. However, it is more likely that food tax revenue would be used to make up for decreasing revenue and so be used to maintain current service levels. Though it is possible that any increases could be spent on the programs noted above, for most program areas, it is unlikely, particularly at the municipal level.

The findings of this report are presented on the next page and discussed in detail in the full HIA report (download here).

HIA-Summary table

Policy Recommendations

The following recommendations were drawn from findings based on literature, data, and stakeholder feedback and are intended to improve population health in New Mexico, maximize health benefits, and minimize health risks. One key finding of this project is that the tax code is an important health determinant and can play a significant role in child and family health and well-being. The policy recommendations that follow are driven by that finding and the idea that changes to tax code should improve and not exacerbate the health and well-being challenges of New Mexico families. More detail on each of the recommendations can be found in the full HIA report.

Primary Policy Recommendations

Do not tax food. The HIA team strongly recommends that the food tax deduction is not repealed and food is not taxed due to the potentially harmful health impacts, regressivity, and increased health disparities that could result.

Generate revenue in other ways. If it is determined that new revenue is needed, instead of a food tax, New Mexico should consider other taxes that would likely have a less harmful effect on the health of vulnerable populations in New Mexico and potentially address some of the existing regressivity in the tax code. These include repealing the capital gains deductions; increasing corporate income taxes or fees collected from large and/or multi-state corporations; mandating combined reporting; enacting higher personal income tax rates for very high-income earners; and raising taxes that are associated with curbing unhealthy behavior.

Secondary Policy Recommendations

Given that New Mexico has high rates of poverty and food insecurity, several other policy recommendations should be considered to help improve the health determinants and outcomes that many New Mexicans are facing now, even without a tax on food.

Note: These recommendations are targeted towards improving families’ day-to-day economic security, food security, diet, and nutrition and do not in any way serve as an endorsement of a tax on food. While they could mitigate some of the harmful effects of a food tax, they would not likely address all or even most of those effects. Rather, these policy recommendations should be considered not just in addition to, but also apart from, any decision about taxing food.

Increase current state tax credits and create new credits for low-income families with children. Increasing tax credits for low-income families with children is one way to combat the regressivity of the state’s tax system and lift working families out of poverty. Changes could include increasing the Low-Income Comprehensive Tax Rebate and the Working Families Tax Credit (based directly on the federal Earned Income Tax Credit). The state could also implement a state Child Tax Credit based on the federal credit. Making payments of anticipated refundable credits available on a monthly basis would also help low-income families provide basics like healthy food on a more consistent basis throughout the year than is reasonable with one yearly payment.

It is important to note that though tax credits make the tax system more progressive, they do not address the underlying causes of poverty and food insecurity—they simply help to mitigate them. And while tax credit participation is higher in New Mexico than nationwide, many eligible participants do not receive the credits. To be most effective, tax credits must be paired with public awareness campaigns and free tax preparation assistance for low-income filers.

Increase and/or maximize programs that help to improve the diet- and nutrition-related health outcomes of vulnerable populations. To make improvements in this area, policy-makers could increase appropriations for services directly related to food insecurity and hunger, particularly in rural and frontier areas; increase SNAP enrollment by maximizing available program benefits and streamlining enrollment and recertification; increase utilization of USDA at-risk meal program funds; take full advantage of community eligibility for free and reduced-price school lunches; improve data sharing under the New Mexico Health Information Act; increase coordination and administrative resource sharing for administering food programs; and increase the statewide minimum wage and index it to inflation.

Endnotes

1 National Research Council of the National Academies, 2011
2 World Health Organization, 1999
3 National Research Council of the National Academies, 2011
4 HIA Process, The Pew Charitable Trusts, August 2014
5 “Closing the gap in a generation: health equity through action on the social determinants of health,” final report of the Commission on Social Determinants of Health (CSDH), World Health Organization: Geneva, 2008
6 North American HIA Practice Standards Working Group, 2014

Download this executive summary (Nov. 2015; 12 pages; pdf)
Download the full report and appendix (Nov. 2015; 94 pages; pdf)
Link to the press release

Suggested Citation: Wallin, A., Casau, A., Jimenez, J., Bradley, G., Kayne, S. (2015). A Health Impact Assessment of a Food Tax in New Mexico: An analysis of the taxation of grocery purchases and its impacts on the health of the state’s children, families, and communities, New Mexico Voices for Children.