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SPONSOR: |
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DATE TYPED: |
|
HB |
15 |
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|
SHORT TITLE: |
In-Plant Training |
SB |
|
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|
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ANALYST: |
Collard |
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APPROPRIATION
|
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
||
|
FY03 |
FY04 |
FY03 |
FY04 |
|
|
|
$20,000.0 |
|
|
See Narrative |
Recurring |
General
Fund |
(Parenthesis
( ) Indicate Expenditure Decreases)
REVENUE
|
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
|
|
FY03 |
FY04 |
|
|
|
|
$20,000.0 |
|
See
Narrative |
Recurring |
Development
Training Fund |
(Parenthesis ( ) Indicate Revenue Decreases)
Relates to House Bill 8
Relates
to Appropriation in the General Appropriation Act
Economic
Development Department
SUMMARY
Synopsis
of House Bill 15
House Bill 15
appropriates $20 million from the general fund to the development training fund
for the Economic Development Department to provide classroom and in-plant
training for certain new or expanding industries and businesses in the
state. The bill has an emergency
clause.
FISCAL IMPLICATIONS
The appropriation of
$20,000.0 contained in this bill is a recurring expense to the general fund
since the legislature considers requests for funding this program each
year. The funds are appropriated to the
development training fund. Any unexpended or unencumbered balance remaining at
the end of FY03 shall not revert to the general fund.
The industrial
development fund currently has a
balance of $15,159.3 and $10,000.3 of this total is unencumbered. This balance is
from the
following sources: FY03 appropriated
funding, company reversions, due to the recent downturn in the economy, and
Temporary Assistance for Needy Families funds.
ADMINISTRATIVE IMPLICATIONS
The Economic
Development Department indicates there is not an appropriation for administration
of the program and there has not been an appropriation since 1999, when it
received $160.0. The agency indicates
that those funds will be depleted by the end of FY03.
RELATIONSHIP
This bill relates to
House Bill 8 which appropriates $15 million to the In-Plant training program.
OTHER SUBSTANTIVE ISSUES
The Economic
Development Department indicates the consequences of not enacting this bill would
result in the loss of
There
have been discussions regarding the kinds of companies that are funded through this program, especially in the low-wage telemarketing arena. For
example,
Stream International has been
awarded four
contracts since its opening
in 2000. The company has been awarded $4,544.0 in training funds and they have expended $2,391.1. Including
Stream International’s
current allotment to train 200
employees,
the in-plant training
program has
funded training for
approximately 653 FTE*. Stream International housed 626 FTE as of November 2002. In-Plant
funding has
trained approximately 27 more FTE
than the company employs. The Economic Development
Department indicates the high
turnover rate is
due to Stream International’s strict attendance policy and the company’s turnover rate is not higher than the call center industry average.
POSSIBLE QUESTIONS
1. Would companies that
were funded have
come to New Mexico
without this incentive ?
2. What can be done about high turnover rates ?
*This
number is based on
pro-rated figures.