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F I S C A L I M P A C T R E P O R T

SPONSOR Garcia, MP

DATE TYPED 1/26/2005 HB 239

SHORT TITLE Uranium Enrichment Facility Restrictions

SB

ANALYST Aguilar

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Commissioner of Public Lands (SLO)

Department of the Environment (ED)

Responses Not Received From

Attorney Generals Office (AGO)

SUMMARY

Synopsis of Bill

House Bill 239 would prohibit the commissioner of public lands from selling, leasing, or other-

wise conveying state land for use as the site of a uranium enrichment facility unless the facility is

economically feasible as determined by the Environment Department.

HB 239 directs the Environment Department to adopt rules for approval of a uranium enrichment

facility which include a requirement for adequate funding of waste storage.

HB 239 declares an emergency.

House Bill 239 -- Page 2

Significant Issues

The Commissioner of Public Lands is charged by the enabling act with maximizing revenue gen-

erated by trust lands for those beneficiary institutions identified. Section 19-1-17 NMSA 1978

specifically identifies these institutions.

Section 19-1-1 NMSA provides the commissioner of public lands shall have jurisdiction over all

trust lands owned by the state, except as may be otherwise specifically provided by law, and

shall have the management, care, custody, control and disposition of such lands.

At present a number of questions remain as to how waste material produced by uranium enrich-

ment facilities will be disposed of. HB 239 directs Environment Department involvement to en-

sure that public health and the environment are protected and the appropriate financial assurance

is in place to make certain appropriate disposal and reclamation take place.

The Environment Department notes that HB 239 directs the department to adopt rules for ap-

proval of a uranium enrichment facility. Although not clearly stated in the legislation, such rules

would establish a new state program for permitting this type of facility. These rules could not be

inconsistent with the U.S. Nuclear Regulatory Commission’s (NRC) licensing and enforcement

authority under federal law, but such rules could provide additional assurances as determined

necessary to protect the health and environment of the citizens of New Mexico. The Environ-

ment Department currently has little say on whether an NRC license to construct, operate, and

decommission a uranium enrichment facility is granted or not.

HB239 directs the Environment Department to require financial assurance for waste storage un-

der these rules for the proposed uranium enrichment facility. This financial assurance could be

used by the State of New Mexico to ensure that all radioactive waste created by the facility is

properly stored, treated and disposed of in a manner that protects human health and the environ-

ment. Currently, the NRC, and not the State of New Mexico, will be the licensing and enforce-

ment agency for most issues, including financial assurance at the proposed facility.

The State Land Office refers to Section 10 of the New Mexico Enabling Act, Article XIII Sec-

tion 2 of the New Mexico Constitution and Sections 19-1-1, 19-1-2 and 19-7-9 NMSA 1978

which provide that the commissioner of public lands shall select, locate, classify and have the

direction, control, care and disposition of all public lands. This proposed legislation may be in

conflict with the constitutional duties of the Commissioner.

The State Land Office also notes established common law, e.g., State ex re.l. Otto v. Field, 31

N.M. 120 (1925) also references the determination of economic feasibility is the particular prov-

ince of the separately elected, constitutionally created Commissioner as trustee of the Enabling

Act trust, not outside state agencies.

PERFORMANCE IMPLICATIONS

Enacting of HB 239 may impact State Land Office measures regarding income received from

commercial leasing activities.

House Bill 239 -- Page 3

FISCAL IMPLICATIONS

This bill has the potential to reduce revenue generated by the State land Office for beneficiary

institutions.

ADMINISTRATIVE IMPLICATIONS:

HB 239 tasks the Environment Department with conducting feasibility studies and developing

financial assurance requirements. These could be absorbed with current resources. The Depart-

ment is currently tasked with similar functions at many of the state’s mines and hazardous waste

treatment, storage, and disposal facilities.

PA/lg