New Mexico

Overview

Two state retirement systems in New Mexico account for all state and local government pension assets and participants in the state. These are the New Mexico Public Employees’ Retirement Association (PERA) and the New Mexico Educational Retirement Board (ERB). ERB provides retirement and other benefits for certified teachers and other employees of state public schools, colleges and universities, and public charter schools. PERA provides retirement benefits for state employees and employees of political subdivisions that have elected to participate and who are not eligible to participate in the ERB.

Plan Design

All employees of the state and its political subdivisions in New Mexico participate in a defined benefit plan as their primary retirement benefit.

According to the US Government Accountability Office, 93 percent of employees of state and local government in New Mexico participate in Social Security.

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Authorizing Statutes and Board Structure

New Mexico Statutes Title 10, Section 11 establishes the PERA board.

The New Mexico ERB is established by New Mexico Statutes Chapter 22, Article 11.

A 2024 ruling by the New Mexico Supreme Court found that the ERB has sole and exclusive authority to set salaries for its employees and to make personnel decisions:

The New Mexico educational retirement board, as the trustee of the New Mexico educational retirement fund, has the sole and exclusive authority to set salaries and make personnel decisions related to its administration of its funds under its constitutional and statutory authority, and therefore the New Mexico department of finance and administration does not have the authority to either reject salary increases for employees of the New Mexico educational retirement board or seek the governor's approval before implementing such approved salary increases. N.M. Educ. Ret. Bd. v. Romero, 2024-NMCA-013.

Details regarding the composition of these and other retirement boards is accessible via the Retirement and Investment Board Characteristics search tool located at the bottom of this page.

Fiduciary Duty/Prudence Standard

New Mexico Statutes Part 6 prescribes the investment standard of care for the PERA and ERB boards, defining and specifying the state Prudent Investor Rule.

Legal Protections of Retirement Benefits

Article XX, Section 22 of the New Mexico Constitution recognizes that public pensions give rise to vested property rights, protected by due process. Article XX, Section 22 provides that "Upon meeting the minimum service requirements of an applicable retirement plan created by law for employees of the state ..., a member of a plan shall acquire a vested property right with due process protections under the applicable provisions of the New Mexico and United States Constitutions." Pierce v. State, 910 P.2d 288 (determining that state retirement statutes created vested property rights, but not contract rights; "We decline to join those states that find a contractual relationship where one does not clearly and unambiguously exist and that proceed to justify how the legislature may nonetheless unilaterally modify this contract without the consent of the participants."); Whitely v. N.M. State Pers. Bd., 850 P.2d 1011(1993) (determining that public employees did not have the contractual right to unconstitutional impairment of contract). (NM CONST., Article XX, Section 22) Source: Robert Klausner, Esq., State Constitutional Protections for Public Sector Retirement Benefits

More Data

Population (2024) 2,130,256

New Mexico public pension statistics, per U.S. Census Bureau as of FY 2024
Assets	$35.5 billion
Active Members	118,695
Annuitants	103,147
Benefits Paid	$2.8 billion
Employee Contributions	$858.3 million
Employer Contributions	$1.3 billion
Systems	Two state systems that account for all public pension plan participants and assets in the state. There are no locally sponsored retirement systems in New Mexico.

Become A Member

Becoming a member of NASRA offers a unique opportunity to join a community committed to the sound, efficient, and innovative stewardship of public retirement systems. Membership connects you with a network of professionals and experts, providing valuable insights into managing public retirement systems with a focus on sustainability and risk-averse strategies.

By joining NASRA, you gain the tools and resources to enhance the management of public retirement systems, ensuring their long-term success and reliability for generations to come.

What's New at NASRA: Public Pension Investment Return Assumption Brief Updated

NASRA’s latest update to standing issue briefs, Public Pension Plan Investment Return Assumptions underscores the critical role the investment return assumption plays in the financial health of public pension plans. Of all actuarial assumptions, it has the greatest impact on plan funding levels and cost. This brief traces how a decade of low interest rates and inflation, beginning in 2009, prompted many plans to reduce their long-term expected returns in line with more modest capital market projections. However, since inflation began rising in early 2021, the trend toward lowering return assumptions has largely paused. While reducing a plan’s assumed return can increase both costs and unfunded liabilities, setting this assumption is a careful, thorough process. It draws on expert input from actuaries and investment professionals and is guided by actuarial standards of practice.

Retirement System Account Interest Policies	Economic Actuarial Assumptions	Retirement and Investment Board Characteristics
Information about interest rates applied to account balances of inactive plan participants	Assumed rates of investment return and inflation	Composition and characteristics of public retirement and investment oversight boards
Mortality Assumptions	Plan Design Features	Post-retirement Employment Policies
Public retirement system actuarial assumptions for mortality	Numerous elements of retirement plan design	Policies governing return-to-work for retirement system annuitants