Senate Bill 413, which would raise the cap on certain private-equity investments from the Severance Tax Permanent Fund from 11% to 14%, received a narrow do-pass recommendation from the Senate Tax, Business and Transportation Committee, 5–4.

Sponsor Sen. George Pinto said the change is intended to give New Mexico a tool to keep scientists and entrepreneurs in state if layoffs at national labs drive them into the private market. “If we have a lot of talented people entering the marketplace … we can have the money available to do a private equity funding that would include those scientists and get them to stay here and develop their manufacturing,” Pinto said.

Why it matters: Backers argued the fund would let the state seed high‑risk, early-stage companies whose founders previously relied on national-lab employment. Opponents — and some skeptical committee members — emphasized the Severance Tax Permanent Fund’s purpose is to generate long-term returns for public services and warned that private-equity investments carry higher risk and have underperformed in the past.

Details and debate: The bill drew detailed discussion of the State Investment Council’s (SIC) record and the Fiscal Impact Report (FIR). Pinto and former Sen. Shannon Robinson told senators the SIC’s private-equity portfolio is still reflecting past poor returns and that the change would be permissive, not mandatory. The FIR shows the SIC’s private-equity allocations had negative returns in periods when some investments failed, and several senators said they wanted stronger safeguards and reporting from SIC if the cap is raised.

Sen. Adam Sherr asked whether the law could force companies that receive state-backed funding to remain headquartered in New Mexico. Pinto replied those residency and job-creation requirements are already in the bill, but warned enforcement has been uneven in previous investments and said oversight of SIC must improve. “We need to work with the state investment council to get them to understand … this is a jobs bill,” Pinto said.

Several senators also pressed on accountability, repayment expectations and the risk of “pay-to-play” investments — historical problems legislators said the state must avoid. Pinto pointed to recent responses from SIC and said the bill would not force investments; it would only allow them.

Committee action: The committee took a do-pass motion from Sen. Bergings and a second from Sen. O’Malley. The motion carried 5–4. The committee record shows the result as a narrow advance to the next step; the bill goes next to Senate Finance or other scheduling as the Senate process requires.

What remains unclear: The committee debate referenced an FIR and the SIC’s recent statements but did not produce an actuarial or formal, multi-scenario stress test specifically tied to the 14% cap before the vote. Senators asked for more transparency from SIC and for legislative oversight if the bill advances.

Where this goes next: The bill now advances with a do-pass recommendation; supporters said they will continue working edits and oversight language with SIC and legislative finance staff.

Ending: Supporters framed the bill as a targeted economic development tool to keep high‑value science jobs in New Mexico; opponents framed it as an unacceptable risk to a fund created to support long-term public needs. The vote was close and signals continued contest in subsequent committees.