SANTA FE –On Wednesday, the New Mexico Supreme Court will hear oral arguments in a lawsuit brought by the Administrative Office of the Courts (AOC) against the New Mexico Department of Finance and Administration (DFA).

The arguments are set to begin at 10:30 a.m. at the New Mexico Supreme Court on 237 Don Gaspar Ave, Santa Fe, NM 87501.

The Court's opinion in this case could have significant and long-lasting implications for the legislature's exclusive authority over the expenditure of public funds and the constitutional principle of checks and balances.

The lawsuit challenges DFA's decision on June 2024 to decline paid time off (PTO) payouts to judicial employees based on Supreme Court policy that conflicts with legislative restrictions on the spending of public funds. DFA made its decision based on existing state law. The New Mexico Department of Justice affirmed this decision in a legal opinion issued on June 13th, 2024.

What's at stake?

The AOC's lawsuit seeks to consolidate power in the judiciary by circumventing legislative oversight of its appropriation of public funds.
While the judiciary is an independent branch of government under the New Mexico Constitution, it is not an independent government. If the AOC prevails, the judiciary will gain unchecked control over legislative appropriations, undermining both the democratic legislative process and subverting transparency and accountability.
This lawsuit represents a pivotal test of the state's constitutional framework, with far-reaching consequences for public fund governance and the balance of power among New Mexico's three branches of government.

Oral arguments can be viewed on the Supreme Court's YouTube page.

What is Judicial PTO?
The AOC's PTO scheme, adopted by the New Mexico Supreme Court, enables judicial employees to accrue sick and annual leave at the same generous rate as other state government employees. However, the policy combines both leave types into a single PTO system, thereby eliminating important legislative distinctions, disregards caps, and overrides restrictions on "buybacks" and "payouts." This effectively creates an annual bonus system and allows substantial payouts to retiring judicial employees only, exceeding what is permitted under current law.

The PTO scheme creates a system for yearly bonuses and "golden parachute" payouts that not only applies to one group of government employees but is also above what the current New Mexico law entitles them to receive. The scheme will cost taxpayers around 180% more to pay out judicial employees than other state employees. The highest request for payout so far is over $80,000.