New Mexico tapped into billions of dollars out of its oil hotbeds this past fiscal year.
According to a report from the New Mexico Tax Research Institute and Moss Adams, a Seattle-based accounting, consulting and wealth management firm, the state collected more than $4 billion in revenue from activities related to oil and natural gas production in FY18, which is more than $1 billion higher than what New Mexico took the year before. The revenue was made up of royalties and taxes, land income and investment income.
The Tax Research Institute examined oil and gas production in New Mexico and eight surrounding states. It found the Land of Enchantment to have the greatest percentage share of total oil and gas production value directly contributed to government revenue compared to the other states.
The state government captured 20.7 percent of value from oil and gas production in FY17, compared to Texas' 14.9 percent, the second-highest percentage found in the study. New Mexico's percentage climbed to 21.8 percent in FY18.
“New Mexico obtains the greatest percentage of total oil and gas production value directly contributing to government revenue when compared to eight other states,” John Tysseling, a co-author of the report and consulting director at Moss Adams, said in a statement.
With oil hotbeds such as the Permian Basin in the southeast part of the state, New Mexico is the third-largest oil producing state and the ninth-largest natural gas producer.
“New Mexico is getting, by far, more out of its oil and gas industry than any of the other states,” said Richard Anklam, president and executive director of the Tax Research Institute, in a statement.
Anklam, Tysseling, and Moss Adams' Jeff Bjarke, the co-authors of the study, were scheduled to appear before the House Appropriations and Finance Committee on Friday for a presentation to legislators, according to a news release.
Oil and gas has a significant impact on New Mexico's general fund, and specifically, its schools. New Mexico's general fund and schools were recipients of $1.743 billion in FY17, with $934 million of the new oil and gas impact going to education.