It turns out the Commission simply refused to consider Elane Photography's religious exemption claim under the New Mexico Religious Freedom Restoration Act: "To the extent that Elane Photography's arguments in this proceeding sought to raise questions ... as to an automatic preemption of the NMHRA by ... the New Mexico Religious Freedom Restoration Act, those questions are not before the New Mexico Human Rights Commission for determination in this proceeding and, accordingly, are not addressed here."

Is this right? Here's what the New Mexico RFRA says:

[§ 28-22-3:] A government agency shall not restrict a person's free exercise of religion unless:

A. the restriction is in the form of a rule of general applicability and does not directly discriminate against religion or among religions; and

B. the application of the restriction to the person is essential to further a compelling governmental interest and is the least restrictive means of furthering that compelling governmental interest.

[§ 28-22-4:] A person whose free exercise of religion has been restricted by a violation of the New Mexico Religious Freedom Restoration Act may assert that violation as a claim or defense in a judicial proceeding ....

The New Mexico Human Rights Commission is a government agency, and the New Mexico RFRA was indeed raised to it in Elane's brief. Is the theory that § 28-22-4 is seen as exclusive, so that it can only be raised in judicial proceedings and not administrative proceedings? That would seem odd: One would think that given that all government agencies are bound by the state RFRA, even purely executive officials have an obligation to conform their conduct to it, and adjudicatory administrative officials would as well. The Commission doesn't explain its reasoning on this point.

I should note that the California Constitution explicitly bars administrative agency "To declare a statute unenforceable, or refuse to enforce a statute, on the basis of it being unconstitutional [or preempted by federal law] unless an appellate court has made a determination that such statute is unconstitutional [or preempted]." But that's a California-specific rule, and even it doesn't bar California agencies from considering the extent to which one state statute carves out a defense to or exceptions from another state statute.