State of New Mexico

Office of the Governor Susana Martinez

Governor Contact: Enrique Knell (505) 819-1398 enrique.knell@state.nm.us

For Immediate Release April 3, 2013 Governor Martinez Enacts Sweeping Reforms to Unemployment Insurance Fund

Governor takes politics out of the management of unemployment insurance, increases penalties for fraud, makes worker's comp program more efficient
ALBUQUERQUE - At a meeting of the New Mexico Society of Association Executives, Governor Susana Martinez signed legislation today that enacts sweeping reforms to the structure and management of New Mexicos Unemployment Insurance (UI) fund. Previously, rates that businesses pay to the unemployment insurance fund have been arbitrarily set by the Legislature and the Governor, with frequent changes to rates and benefits that have led to dangerously low levels of money in the unemployment insurance fund. Since taking office, the Governor has protected businesses from dramatic rate increases, vetoing a $128 million increase on businesses in 2011 and even providing temporary tax relief in 2012, while the Governor activated the Unemployment Insurance Advisory Council and challenged it to come up with a solution for wholesale reform. Senate Bill 334, sponsored by Senator Stuart Ingle, does away with the previous rate schedule, turning the fund into a true insurance system and ending the need for the Governor and the Legislature to regularly pass legislation setting rates that businesses must pay. The legislation passed near unanimously in both chambers. "This is bipartisan, sweeping reform that benefits New Mexico businesses and the unemployed alike," said Governor Martinez. "Politicians in Santa Fe shouldn't be using an unfair and arbitrary rate structure to change costs on businesses year after year. That's not predictable, and it's far too political. With these reforms, we are taking the politics out of the management of the unemployment fund and making it a true insurance system that is more predictable and fair for New Mexico small businesses." Governor Martinez also signed House Bill 329, sponsored by Rep. Cathrynn Novich-Brown, and Senate Bill 275, sponsored by Senator Pat Woods. HB 329 increases penalties for fraudulently filed claims in the unemployment insurance system, aligning New Mexico with federal standards and further helping the

state reduce the amount of over-payed unemployment funds each year. The Martinez Administration has already cut the unemployment overpayment rate in half over the last year, marking the largest drop in overpayments in the nation. SB 275 takes several steps to make the management of the worker's compensation program in New Mexico more efficient, allowing workers compensation hearings to be conducted by telephone or videoconference, for example, and allowing the adjudication of claims to be done in any regional office in the state. These reforms and others are expected to streamline worker's compensation claim resolution and reduce costs to taxpayers. ###