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

SPONSOR Gutierrez

ORIGINAL DATE

LAST UPDATED

1-24-08

HJM 19

SHORT TITLE Support Community Recycling Efforts

SB

ANALYST Aubel

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY08

FY09

FY10 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

New Mexico Environment Department (NMED)

Economic Development Department (EDD)

Association of Counties (AOC)

New Mexico Recycling Coalition (NMRC)

No Response

Taxation and Revenue Department (TRD)

SUMMARY

Synopsis of Bill

House Joint Memorial 19 requests the New Mexico Environment Department (NMED) to work

with the New Mexico Recycling Coalition (NMRC) to develop legislation to establish funding

mechanisms to support community infrastructure for waste reduction, reuse and recycling

resources in New Mexico. HJM 19 directs NMED to develop strategies to expand the

department’s technical assistance in these areas, launch a statewide education campaign and

provide educational grants. HJM 19 also directs the Economic Development Department (EDD)

to work with the NMRC, the Department of Taxation and Revenue, and the Office of the

Governor to develop tax incentive legislation and strategies to gain more recycling processors

and recycled-content manufacturers in New Mexico. NMED and the EDD are required to report

their findings to an appropriate interim legislative committee.

House Joint Memorial 19 – Page

2

FISCAL IMPLICATIONS

None of the responding agencies noted any direct fiscal impact generated by this joint memorial.

SIGNIFICANT ISSUES

According to the United States Environmental Protection Agency (EPA), New Mexico lags far

behind the nation in recycling with a 9.7 percent statewide recycling rate in 2006 compared to

the national average of 32 percent. HJM 19 focuses on developing both the recycling “mindset"

and economic resources and incentives to increase recycling activities in the state.

NMED maintains that recycling conserves energy, reduces water usage, preserves natural

resources, conserves valuable landfill space, and significantly reduces greenhouse gas emissions

that many believe contribute to global warming. In addition, EDD notes that recycling is an

economically valuable activity that creates jobs. According to the New Mexico Recycling

Coalition, for every one job handling trash headed for the landfill, there is an average of five jobs

created by recycling. EDD also maintains that recycling offers another avenue for increasing

“clean energy" businesses in the state.

All responding agencies maintain that a statewide educational campaign is essential to changing

habits regarding reducing, reusing, and recycling. They also agree that incentives for businesses

to process, produce and consume recyclables are needed to increase recycling. Finally, they note

that the state currently does not offer significant state grants and loan programs to support

communities in developing or expanding their recycling infrastructure.

NMRC notes that many rural communities lack recycling access and even the urban areas

struggle to achieve minimum recycling participation. Thus, NMRC concludes that a joint effort

to grow community recycling programs -- through educational outreach and infrastructure

development -- at the same time as growing local markets to consume these products is vital.

PERFORMANCE IMPLICATIONS

The New Mexico Solid Waste Act (NMSA 1978, §§74-9-1 to 74-9-42) set goals to divert 25

percent of all solid waste from disposal facilities by July 1, 1995, and 50 percent by 2000. There

was no mechanism for funding for this goal included in the Act. NMED suggests that in the

long term, recommendations initiated by HJM 19 will improve NMED’s performance measures

by reducing the amount of solid waste produced by the citizens of the state. EDD notes that

other states are aggressively creating and implementing policy and incentives to grow clean

energy industries. Colorado, California and Oregon are leaders in clean energy policy

development. To remain competitive with these states, EDD suggests that New Mexico must

continually review and update its own policy and programs.

ADMINISTRATIVE IMPLICATIONS

NMED maintains that it already collects statewide waste and recycling data and tracks trends,

strategies, and legislation locally and nationally relating to this topic and that tasks required by

this memorial will be performed by existing staff in the normal course of duty. EDD points out

that the Governor’s office, Environment Department, Energy Minerals and Natural Resources

and Economic Development Departments have already formed a “Clean Energy Committee" to

House Joint Memorial 19 – Page

3

address issues, policy and strategies to recruit and grow more clean energy industry in the state.

EDD maintains that addressing the mandates of this joint memorial could easily be taken on by

this committee without the addition of significant staff time for any agency involved.

OTHER SUBSTANTIVE ISSUES

According tot EDD, clean energy companies are a “target industry cluster" for the agency’s

business development strategies. The Job Training Incentive Program (JTIP) recently expanded

its policy to include clean energy businesses in its eligibility requirements.

Based on waste characterization studies, NMRC estimates that the annual value of recyclable

resources sent to state landfills is approximately $50 million.

NMED estimates the current 9.7 percent recycling rate represents a calculated reduction in

greenhouse gas emissions of 128,088 metric tons carbon equivalent. Increasing the recycling rate

will corresponding decrease the related greenhouse emissions. The New Mexico Climate Change

Advisory Group identified increased recycling as a key component to reducing greenhouse gas

emissions. According to the report, if the state reached a 22 percent recycling rate by 2020,

recycling would be the 13

th

most effective way for the state to reduce overall emissions.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

EDD maintains that New Mexico may lose its leadership status in the vast arena of clean energy

policy without continuing the momentum to create new programs and incentives to grow this

industry group. NMED mentions its concerns that New Mexico will continue to fall far short of

the goals set in the Solid Waste Act, lag behind the nation in recycling, and fill up its landfills by

continuing to bury 90.3 percent of its solid waste, including recyclable materials. In addition, the

department suggests that New Mexico will not take advantage of increased job creation,

decreased greenhouse gas emissions, and decreased energy and water use associated with

recycling. The New Mexico Recycling Coalition is concerned that local communities will

continue to struggle with their recycling programs.

MA/mt