Proposed constitutional amendment · Version 3
Establishing Full State Ownership of Public Utilities
Section 1. Short Title.
This amendment may be cited as the “New Mexico Public Utilities Public Ownership Amendment of 2026.”
Section 2. Findings and Purpose.
The people of New Mexico declare that electricity, natural gas, water, and wastewater services are essential to public health, safety, and economic prosperity. Experience across the United States demonstrates that fully publicly owned utilities consistently deliver lower rates—typically 13–14% lower on average than investor-owned utilities—because they eliminate the profit layer paid to private shareholders, avoid certain taxes that are passed on to ratepayers, and focus on long-term reliability rather than quarterly returns.
Nebraska, the only state with 100% public ownership of electricity, maintains some of the lowest residential rates in the nation while providing high reliability. Municipal utilities in cities nationwide similarly operate efficiently without the added expense of private investor mandates.
To ensure these utilities are run as efficiently and effectively as possible, this amendment mandates full public ownership together with rigorous, independent annual peer reviews by practicing experts from other high-performing utilities. This mechanism will provide ongoing, real-world evaluation and recommendations for continuous improvement.
Section 3. Amendment.
Article XI of the Constitution of New Mexico is amended by adding the following new section:
“Article XI, Section 21. Full Public Ownership of Public Utilities.
A.
As used in this section, ‘public utility’ means any entity that owns, operates, leases, or controls facilities used in the generation, transmission, distribution, or sale of electricity; the distribution or sale of natural gas; the provision of water supply, treatment, or wastewater services; or other essential utility services as defined by law, when such services are provided to the public or any portion thereof within the State of New Mexico. This definition applies regardless of the entity’s prior ownership structure and excludes facilities regulated exclusively by federal law as interstate transmission.
B.
All public utilities serving customers in New Mexico shall be owned 100% by the State of New Mexico. No private person, corporation, or other entity may hold any ownership interest, equity, voting rights, or beneficial control in such utilities after the effective date of full compliance.
C.
The State shall exercise ownership through one or more public authorities, boards, or agencies established by law. These entities shall:
- Be governed by boards whose members are appointed by the Governor and confirmed by the Senate, or elected by the public as provided by law, to ensure accountability;
- Hire and retain professional managers, engineers, and operators at compensation levels competitive with the national utility industry to attract the highest caliber talent;
- Operate the utilities with the primary goals of affordability, reliability, safety, environmental responsibility, and long-term infrastructure investment, without any mandate to generate profits for private investors.
D.
Annual Independent Peer Review for Efficiency and Best Practices. To ensure continuous improvement and the highest standards of operation, each public utility authority shall undergo an annual independent performance and efficiency review as follows:
- A panel of five to seven (5–7) individual utility specialists shall be selected each year. These specialists shall be practicing managers, engineers, or operations experts currently employed by other high-performing public or municipal utilities outside New Mexico. Selection shall prioritize diversity of experience and shall not come from a single firm or consulting company.
- Selection shall be conducted in a transparent, arm’s-length manner by the governing board or an independent oversight committee established by law, using a process that includes random drawing from a qualified pool of nominees submitted by national public utility associations or similar bodies.
- The selected specialists shall conduct an on-site examination of the utility’s procedures, operations, management practices, rate structures, maintenance programs, and overall efficiency for a period of two (2) weeks.
- Within thirty (30) days after the review concludes, the panel shall produce and publicly release a written report of their findings, including strengths, areas for improvement, comparisons to industry best practices, and specific recommendations.
- The utility authority shall respond publicly to the report within sixty (60) days and incorporate feasible recommendations into its operations. All reports shall be made available to the Legislature, the Governor, and the public.
E.
The Legislature shall enact implementing laws that provide for:
- A structured transition of existing utilities to full state ownership, which may include negotiated purchases, condemnation with just compensation as required by law, assumption of existing debt, or other lawful means;
- A reasonable transition period not to exceed seven (7) years from the effective date of this section, with interim oversight to protect service continuity;
- Financing mechanisms, including the issuance of revenue bonds or other obligations consistent with Article IX of this Constitution;
- Rate-setting processes that prioritize cost recovery and public benefit over private returns;
- Protection of existing municipal utilities owned by cities, counties, or local governments, which may continue under local public ownership or elect to consolidate under state ownership as provided by law; and
- Enforcement mechanisms, including penalties for violations.
F.
This section is self-executing to the extent practicable, but the Legislature shall have full authority to adopt supplementary laws and regulations. All actions taken pursuant to this section shall respect due process, just compensation, and other rights guaranteed by this Constitution and the United States Constitution. Existing contracts shall remain in effect only to the extent they do not conflict with the full public ownership mandate.
G.
Nothing in this section shall prevent the State or its public utilities from entering into contracts for specific services, construction, or expertise with private entities, provided that ultimate ownership and control remain 100% with the State of New Mexico.”
Section 4. Submission and Effective Date.
This proposed amendment shall be submitted to the voters of New Mexico for approval or rejection at the next general election or at a special election called for that purpose. If approved by a majority of the electors voting thereon, it shall become effective on January 1 of the year following approval, with full compliance required no later than seven (7) years thereafter.
REFERENCE MATERIALS
Justification for the New Mexico Public Utilities Public Ownership Amendment (Version 3)
Why New Mexico Should Choose Full State Public Ownership Over the Proposed Blackstone Acquisition of PNM
Background
In May 2025, TXNM Energy (parent of Public Service Company of New Mexico – PNM) announced an $11.5 billion acquisition by Blackstone Infrastructure. The deal remains pending full regulatory approval. Blackstone promises some short-term customer credits and commitments to keep PNM headquartered in New Mexico, but as a private equity firm, its primary duty is maximizing returns for investors.
sourcenm.com This document compares the two paths using proven data on public vs. investor-owned utilities. Full state ownership (as proposed in the constitutional amendment) prioritizes New Mexicans over out-of-state investors.
Side-by-Side Comparison
| Aspect | Blackstone / Private Equity Ownership (Current Path) | 100% State Public Ownership (Proposed Amendment) |
|---|---|---|
| Ownership & Control | Private equity investors (Blackstone) control decisions. Fiduciary duty is to maximize investor returns. | 100% owned by the people of New Mexico through a public authority. Democratic accountability via elected/appointed boards. |
| Typical Residential Rates | Investor-owned utilities (IOUs) like PNM average 13–14% higher bills than public power. PNM rates are already subject to frequent increases to cover profit margins. | Public utilities deliver 13–14% lower average residential bills nationwide. Nebraska’s fully public model has rates ~27–30% below national average. Long-term savings of $188–$305 per household annually. |
| Profit Layer & Costs | Requires ~8–13%+ returns to shareholders + high executive pay tied to profits. These costs are passed to ratepayers. | No shareholder dividends or profit mandates. All revenues reinvested in infrastructure, maintenance, and lower rates. Eliminates the extra “Monopoly” extraction layer. |
| Rate Increases Over Time | IOU rates rose faster (e.g., 27%+ in recent periods) and are more volatile. Private equity often loads acquired utilities with debt, leading to future rate hikes. | Public power rates rose more slowly (only 11.7% vs. 27.2% for IOUs in recent 4-year data). Focus on stability and affordability. |
| Management & Efficiency | Managers incentivized to cut costs for short-term profits; potential underinvestment in long-term reliability. | Competitive salaries to attract top talent. Mandatory annual 2-week independent peer review by hand-picked experts from other high-performing public utilities (not consulting firms). Public report + required response ensures continuous improvement and best practices. |
| Capital Investment | Access to private capital, but often at higher cost and with expectations of high returns. Promised $175M in benefits over years is one-time. | Lower-cost tax-exempt bonds. Full reinvestment in New Mexico priorities (renewables, reliability, economic development) without investor extraction. |
| Accountability to Citizens | Regulated, but private owners can influence via lobbying. History of private equity utility deals shows mixed results on rates and service. | Direct public ownership + annual transparent peer reviews + legislative oversight. Citizens own the utility outright. |
| Long-Term Benefits for NM | Short-term credits ($105M rate relief over 4 years ≈ $168 average per customer) but risk of higher future rates to service acquisition debt and deliver investor returns. | Sustained lower rates, local control, protection from Wall Street priorities. Aligns with successful models like Nebraska public power districts. |
Key Advantages of the Public Ownership Amendment
- Proven Savings: Established public utilities consistently outperform IOUs on affordability without sacrificing reliability.
- Built-in Safeguards: The amendment’s annual independent peer review by rotating out-of-state public utility experts provides real accountability and prevents complacency—something private ownership rarely matches.
- Avoids Private Equity Risks: Blackstone’s track record and incentives favor investor returns. Past private equity utility acquisitions have led to higher leverage, cost-cutting, and eventual rate pressure on customers.
- Transition Feasibility: The 7-year phased transition, just compensation, and protection for existing municipal utilities make this practical while securing long-term public control.
- Alignment with New Mexico Values: Keeps critical infrastructure under local democratic control rather than transferring it to a global investment firm.
Conclusion and Recommendation
The Blackstone acquisition offers temporary concessions but locks New Mexico into a model where ratepayers subsidize investor profits indefinitely. The proposed constitutional amendment delivers lower long-term costs, superior efficiency through expert peer oversight, and true public control—benefits already demonstrated by hundreds of successful public utilities and the entire state of Nebraska. Approving this amendment protects New Mexican families, businesses, and future generations from the predictable pressures of private equity ownership. It is the more cost-justified, efficient, and citizen-focused path.
Prepared in Support of the New Mexico Public Utilities Public Ownership Amendment
Data drawn from American Public Power Association reports, EIA comparisons, and Nebraska public power performance. This document can be adapted for legislative testimony, voter education, or public comment filings with the PRC. Let me know if you’d like a shorter executive summary version, added visuals, or further customization!
Discussion leading to these reference materials
This creates a strong accountability mechanism inspired by real-world utility benchmarking and performance audits. Let me know if you want tweaks (e.g., different panel size, more specifics on funding the reviews, or adjustments to the random selection process)!
okay, great, I like this version. Now please produce a justification document because there is an offer on the table by BlackRock, which is one of the largest fund managers in the world, to take over PNM, the public utility company producing electricity in New Mexico. Given those two facts, make me a document. Maybe you should make it a two-column comparison or some method that best presents the fact that a takeover by BlackRock is not as cost-justified, efficient, or in the continued benefit of New Mexican citizens