House Appropriations & Finance Committee staff presented a HAFC scenario that increases the Early Childhood Trust Fund distribution to $400 million from the LFC recommendation of about $289.9 million. Staff identified line‑item increases intended to expand infant and toddler care, prekindergarten and related workforce and infrastructure supports.

Under the HAFC scenario, staff flagged the following additions to reach $400 million: $56,000,000 for child care (prioritized for infant and toddler care), $1,500,000 for IT, $5,000,000 for Medicaid state match for Family Infant Toddler (FIT) services, $10,000,000 for home visiting, $1,000,000 for CACFP reimbursements, $2,500,000 for educator incentives and $25,000,000 for prekindergarten; the $25,000,000 preK line incorporates a previously recommended $10,000,000 from the permanent fund for a total of $35,000,000 for preK in the package.

Kelly (LFC analyst) told the work group: “...the LFC recommendation was for 289,900,000.0, and the HAFC recommendation scenario brings that up to 400,000,000. So the difference is that 101.1.” The HAFC scenario also adds technical language directing childcare assistance increases to be prioritized for infant and toddler care.

Members pressed staff on operational effects of regulatory changes proposed in other venues. Representative Dow expressed concern that reducing group sizes and lowering ratios, even to improve quality, could reduce total slots available in many communities. “I am not okay with compounding the issue,” she said, calling for committee language to ensure expanded funding includes sufficient support for any capacity changes caused by regulatory action.

Staff and department officials responded that the HAFC scenario combines both supply-building and quality investments: a $10,000,000 revolving fund administered by the New Mexico Finance Authority (NMFA) to build physical supply and $56,000,000 prioritized for child care slots aimed at infants and toddlers. DFA staff estimated the program cost per infant slot at the high end of roughly $20,000 per child annually; public preK was estimated at about $13,000 per child.

Members also debated preK “saturation” under the current RFP scoring. Department staff said New Mexico is at roughly 84% preK participation statewide and that some districts will be over 80% while others remain much lower; staff said they would provide district‑level saturation data to the committee. Department staff also clarified that certain 4‑ and 5‑star private providers that operate on a different eligibility basis are not counted in the denominator used to compute preK saturation for New Mexico PreK.

Several members asked for explicit committee language to prioritize infant and toddler capacity and to avoid unintentionally reducing statewide slots while raising quality. LFC staff offered to draft suggested language on group size and ratio and to return data by district on current saturation and slot impacts.

Ending: Committee members did not adopt final language in the work group. Staff committed to provide district-level saturation data, draft clarifying language on group size/ratio impacts and to provide additional detail before the HAFC full‑committee meeting.