NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

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(Parenthesis ( ) Indicate Expenditure Decreases)

(Parenthesis ( ) Indicate Revenue Decreases)

Conflicts with/Relates to House Bill 28, as amended, House Capital Outlay Request 553, and Governor's capital outlay budget recommendation.

SOURCES OF INFORMATION

General Services Department (GSD)

New Mexico Commission on Higher Education (CHE)

New Mexico Finance Authority (NMFA)

Department of Public Safety (DPS)

SUMMARY

Synopsis of Bill

House Bill 851 authorizes the New Mexico Finance Authority to issue $7.5 million in revenue bonds for the purpose of financing the acquisition of real property for the design, construction, acquisition, installation, furnishing and equipping of a digital microwave communications system for the General Services Department; creates a Law Enforcement Communications Access Fund (LECAF); authorizes the transfer of any balances in the Law Enforcement Protection Fund (LEPF), in excess of $100,000 and unobligated, to the LECAF; and pledges the revenues to the LEPF for debt service on bonds.

Significant Issues

If enacted, House Bill 851 authorizes the bonding against the excess revenues in the LEPF and allows the bond proceeds to build digital radio infrastructure that no individual law enforcement agency could accomplish on its own.

The digital radio communications upgrade is a priority for the Executive, however, there currently is no permanent funding source to get digital radio services to rural and remote areas of New Mexico. The benefit of digital radio services to law enforcement and other entities is tremendous, allowing access to national arrest records, emergency medical personnel, hazardous waste expertise, and the expansion of the system to rural areas. The upgrade will also allow other benefits such as access by educators to distance learning technology; access by health care providers for emergency and routine care; and boosts economic development allowing companies that require digital communications to locate in rural communities.

According to the GSD, the Federal Communications Commission will be reducing the available analog frequencies by 2005 and will not provide enough room for the existing radio services to law enforcement and other agencies. New Mexico must transfer to the digital spectrum to have adequate bandwidth to provide radio service without interruption.

FISCAL IMPLICATIONS

Authorizes the NMFA to issue revenue bonds for $7.5 million; diverts excess funds from LEPF, currently transferred to the general fund, to pay principal, interest and expenses related to the issuance of the bonds; limits distribution from LEPF to qualified law enforcement agencies to the current allocation levels; and reduces revenue of approximately $1.4 million to the general fund in FY 2000.

ADMINISTRATIVE IMPLICATIONS

The GSD will integrate the operation of the system into the workload of the Information Services Division and does not anticipate an increase in FTE.

CONFLICT/DUPLICATION/COMPANIONSHIP/RELATIONSHIP

House Bill 28, allows for the distribution of monies in the LEPF to junior college police at two-year post-secondary institutions as well as four-year institutions, and increases the allocation from $300 to $500 for each full-time police officer or sheriff's deputy. According to the Commission on Higher Education, the enactment of this bill could have a potential impact of approximately $350,000 allocated from the LEPF.

The Governor's capital budget recommendation of $2 million from severance tax bonding and House Capital Outlay Request 553 both relate to House Bill 851.

LMK/njw