SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                    FORM 8-K
                                 CURRENT REPORT


                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

 Date of Report (Date of earliest event reported)  March 13, 1996
                                                   -----------------
                                                  (March 12, 1996)
                                                   -----------------

                      PUBLIC SERVICE COMPANY OF NEW MEXICO
             (Exact Name of Registrant as Specified in its Charter)


                                   Commission
          New Mexico               File Number 1-6986          85-0019030
 (State or Other Jurisdiction                               (I.R.S. Employer
      of Incorporation)                                  Identification Number)



Alvarado Square, Albuquerque, New Mexico                87158
(Address of Principal Executive Offices)              (Zip Code)


                                 (505) 241-2700
              (Registrant's Telephone Number, Including Area Code)




          (Former Name or Former Address if Changed, Since Last Report)









ITEM 5. Other Event

Declaration of Cash Dividends on Common Stock

On March 12, 1996, the Company's  Board of Directors  ("Board"),  at its regular
meeting,  declared a cash  dividend of 12 cents per common share  payable on May
24, 1996, to  stockholders  of record as of May 1, 1996.  Based on 1995 earnings
from ongoing  operations,  this dividend reflects a 35 percent payout ratio. The
Board has not declared cash dividends on common stock since 1989.

The Board set the dividend payout ratio below the industry  average to allow for
dividend  growth in the  future  and to sustain  financial  flexibility  for the
Company  to  respond  to  potential   opportunities   in  the  evolving   energy
marketplace.  In  establishing  its new dividend  policy,  the Board weighed the
Company's  current  financial  position and its future business plan, as well as
the regulatory and business climate in New Mexico.

Future  dividend  declaration  will be  reviewed  for  action  by the  Board and
coordinated  with  quarterly  earnings  announcements.  The  payment  of  future
dividends  will depend on  earnings,  the  financial  condition  of the Company,
market conditions and other factors.



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SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

                                        Public Service Company of New Mexico
                                                     (Registrant)



Date:  March 13, 1996                       /s/ Donna M. Burnett
                                        -------------------------------
                                              Donna M. Burnett
                                          Corporate Controller and
                                          Chief Accounting Officer



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