Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance
committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports
if they are used for other purposes.
Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).
Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and
attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.
F I S C A L I M P A C T R E P O R T
SPONSOR Snyder
DATE TYPED 03/03/05 HB
SHORT TITLE Drinking Water System Financing
SB 140/aSFC
ANALYST Kehoe
APPROPRIATION
Appropriation Contained Estimated Additional Impact Recurring
or Non-Rec
Fund
Affected
FY05
FY06
FY05
FY06
$2,000.0
Non-recurring Public Project
Revolving Fund
(Parenthesis ( ) Indicate Expenditure Decreases)
REVENUE
Estimated Revenue
Subsequent
Years Impact
Recurring
or Non-Rec
Fund
Affected
FY05
FY06
$2,000.0
Non-recurring Drinking Water Re-
volving Loan Fund
(Parenthesis ( ) Indicate Revenue Decreases)
Duplicates House Bill 123, as amended.
SOURCES OF INFORMATION
LFC Files
Responses Received From
New Mexico Finance Authority (NMFA)
SUMMARY
Synopsis of SFC Amendment
The Senate Finance Committee amendment reduces the appropriation amount from $4 million to
$2 million and appropriates the funds from the public project revolving fund rather than the gen-
eral fund.
pg_0002
Senate Bill 140/aSFC -- Page 2
Synopsis of Bill
Senate Bill 140 appropriates $4 million from the general fund to the drinking water state revolv-
ing loan fund to provide state match funds for carrying out the purposes of the federal Safe
Drinking Water Act.
Significant Issues
The appropriation contained in this bill will provide a 20 percent state match toward federal allo-
cations in federal fiscal years 2004 and 2005 totaling $16.6 million for loans from the drinking
water state revolving loan fund (DWRLF).
The New Mexico Drinking Water State Revolving Loan Fund Act was enacted by the 1997 Leg-
islature in response to the re-authorization of the federal Safe Drinking Water Act (SDWA). The
re-authorization required the Environmental Protection Agency (EPA) to make capitalization
grants to states over the next seven years to further the health objectives of SDWA. The state act
charged NMFA with establishing, in cooperation with the Environment Department, a loan pro-
gram to provide local authorities with low-cost financial assistance in the construction of neces-
sary drinking water facilities to improve water quality in New Mexico. The Act created the
drinking water state revolving loan fund administered by NMFA.
If statutorily authorized by the Legislature, loans from the Public Project Revolving Fund can be
combined with loans from DWRLF to maximize dollars in the fund. As of June 30, 2004, NMFA
has made 17 loans totaling $21.1 million and committed an additional seven loans totaling $33.5
million from the fund. Entities with binding commitments for loans totaling $33.5 million in-
clude: Roosevelt County Water Cooperation, City of Santa Fe, City of Hobbs, City of Alamo-
gordo, City of Aztec, City of Espanola, and Albuquerque/Bernalillo Water Utility Association.
Section 2 of the bill contains an emergency clause.
FISCAL IMPLICATIONS
The appropriation of $4 million contained in this bill is a non-recurring expense to the general
fund. Any unexpended or unencumbered balance remaining at the end of a fiscal year will not
revert to the general fund, but would remain in the drinking water state revolving loan fund.
ADMINISTRATIVE IMPLICATIONS
The SDWA allows a 31 percent set-aside of the annual federal allocation to be used for adminis-
trative activities of both the Drinking Water Bureau (DWB) of the state Environment Depart-
ment (ED) and NMFA. NMFA utilizes 4 percent of the set-aside to administer the financial as-
pects of the program including legal support, construction oversight, and technical review. DWB
utilizes the funds to provide technical support and capacity development to public water systems.
DUPLICATION
Senate Bill 140 duplicates House Bill 123, as amended, in its entirety.
LMK/yr:njw