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

SPONSOR Leavell

ORIGINAL DATE

LAST UPDATED

01/29/07

02/13/07 HB

SHORT TITLE Adoption of Municipality Codes By Reference

SB 66/aSCORC

ANALYST Hanika Ortiz

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY07

FY08

FY09 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

$.01

see narrative

Recurring Various

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Regulation and Licensing Department/Construction Industries Division (RLD/CID)

SUMMARY

Synopsis of SCORC Amendment

The Senate Corporations and Transportation Committee Amendment removes specific reference

to electrical, housing and plumbing codes because those codes are already reflected within the

building code provisions on pg 1 A, (3). The Amendment clarifies any building code provisions

adopted to include plan review, permitting and inspections for general, electrical, mechanical and

plumbing construction. The Amendment removes pg 2, lines 13 through 16, as intent of the

language already exists on pg 2, within lines 11 and 12. The Amendment also adds an effective

date of July 1, 2008.

Synopsis of Original Bill

Senate Bill 66 amends Section 3-17-6 A. NMSA 1978 and requires municipalities that choose to

adopt a building code, be required to adopt a building code that includes provisions for general,

electrical, mechanical and plumbing construction, not just general construction, and; that any

national codes adopted, amended and enforced by the RLD/CID, represent the minimum

standards of any building code adopted by a local building program.

FISCAL IMPLICATIONS

Local building programs within municipalities that do not use the universal building code are

Senate Bill 66/aSCORC – Page

2

receiving fees from the issuance of building permits which fund inspections. Many of these

programs only have one inspector because the program covers only one building discipline. If

these programs do not have an inspector in place due to normal attrition in the work force, then

the state is statutorily obligated to assume the responsibility for inspections. The permit fees have

already been remitted to the local programs, so the State does not receive revenue to inspect

work in progress. More stable, full-service local programs which employ multiple inspectors

with adequate funding and management do not have this problem. It can be months before a new

inspector is hired, but in the intervening time, the local building program continues to issue

permits for new projects. RLD believes this unexpected demand on State resources adversely

impacts the budget, staffing, and management of State inspections operations.

SIGNIFICANT ISSUES

CID Licensing Act is firmly grounded in the concept of uniformity in building codes. RLD/CID

reports that a number of municipalities have interpreted Section 3-17-6 A (3) to mean that they

can adopt a different building code than the building code adopted by the State. RLD/CID

believes this practice is destroying statewide code uniformity, undermines the uniformity

required for statewide licensing and has made code enforcement inconsistent.

PERFORMANCE IMPLICATIONS

RLD/CID states the amendment will restore the State’s ability to oversee code enforcement and

contractor compliance. At the present time, residents of municipalities that have adopted codes

other than those adopted by the State do not have recourse to the State’s administrative discipline

services. If the contractors in their jurisdictions commit code violation, it is against the local

code, not the State code. The State has authority to require only that a contractor enforce State

code so the State cannot take disciplinary action based on violations of a code it has not adopted.

Further, a local government has no authority to discipline a contractor, so the violations of its

code may continue with no consequence to the contractor’s license.

ADMINISTRATIVE IMPLICATIONS

The amendment proposed within SB 66 will significantly reduce the State’s inspection of locally

permitted building projects and will also ensure that the building codes adopted by a local

building program are as stringent as the State’s codes. SB 66 will also ensure that individuals

licensed by the State demonstrate a technical knowledge of building standards that are in effect

throughout the State.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates HB 219

OTHER SUBSTANTIVE ISSUES

RLD/CID believes building code uniformity has a positive impact on state economic

development because it has less complexity and confusion. Without it, the safety of construction

is compromised by a patchwork of standards that make consistency in code enforcement

virtually impossible. In addition, new businesses may be overwhelmed by unpredictable costs

and complicated, inconsistent regulatory requirements.

Senate Bill 66/aSCORC – Page

3

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

Local jurisdictions will be permitted to continue using 3-17-6 A (3) NMSA 1978 as a revenue-

generating tool without due regard for the safe construction protections afforded the community

within the Construction Industries Licensing Act.

AHO/mt