NOTE:  As provided in LFC policy, this report is intended only 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 for other purposes.

 

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

 

 

 

SPONSOR:

Gonzales

 

DATE TYPED:

03/07/03

 

HB

791/aHGUAC

 

SHORT TITLE:

Questa Engineering & Environmental Services

 

SB

 

 

 

ANALYST:

Padilla

 

APPROPRIATION

 

Appropriation Contained

Estimated Additional Impact

Recurring

or Non-Rec

Fund

Affected

FY03

FY04

FY03

FY04

 

 

 

$100.0

 

 

Non-Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

 

Duplicates Senate Bill 604

Relates to House Capital Outlay Request 1249 and Senate Capital Outlay Request 795

 

SOURCES OF INFORMATION

 

LFC Files

 

Responses Received From

Department of Finance and Administration

Energy, Mineral and Natural Resources Department

Environment Department

 

SUMMARY

 

     Synopsis of HGUAC Amendment

 

The House Government and Urban Affairs Committee amendment directs the $100.0 appropriation to DFA for the purpose of assisting the Village of Questa in paying a loan to the New Mexico Finance Authority for engineering and environmental services to Questa. 

 

It appears as if the Village of Questa has secured or will apply for a loan from the New Mexico Finance Authority for engineering and environmental services.  The type of assistance DFA is to provide is unclear.  The bill directs DFA to “assist” the Village of Questa to pay a loan.  Does the $100.0 appropriation constitute complete repayment of a loan? 

 

If this is in fact a one-time loan repayment, the appropriation of $100.0 from the general fund is a non-recurring expense to the general fund.

     Synopsis of Original Bill

 

House Bill 791 appropriates $100.0 from the general fund to DFA’s Local Government Division for the purpose of contracting for engineering and environmental services for Questa’s village council.  The services are needed to assist and advise the village council regarding the future activities of the Molycorp mine near Questa. 

 

     Significant Issues

 

The bill does not state what “future activities” of the Molycorp mine encompass.  Presumably it means work related to the remediation and reclamation of the Molycorp site.  EMNRD believes the Village of Questa and others could use the expertise that this bill would provide in order to

understand ongoing planning for reclamation, closure and groundwater abatement of the Molycorp mine.

 

The Molycorp mine is currently permitted under the New Mexico Mining Act, which is administered by ENMRD.  EMNRD reports that the mine has an approved reclamation plan that identifies the reclamation work needed once mining is completed.  The reclamation plan is also under the jurisdiction of the Environmental Protection Agency, the New Mexico Environment Department (NMED) and the U.S. Fish and Wildlife Service. 

 

EMNRD explains that the review process for the reclamation and remediation plans is open to the public. Without proper expertise, EMNRD believes the plans can be very complicated and difficult to understand.

 

FISCAL IMPLICATIONS

 

The appropriation of $100.0 contained in this bill is a recurring expense to the general fund.  Any unexpended or unencumbered balance remaining at the end of fiscal year 2004 shall revert to the general fund.

 

ADMINISTRATIVE IMPLICATIONS

 

DFA notes that this bill gives the Local Government Division additional responsibilities without commensurate resources to fulfill them.

 

DUPLICATION

 

This bill duplicates Senate Bill 604. 

 

The bill also appears to duplicate, or at least relate to, capital outlay requests in the House and the Senate.  HCR 1239 and SCR 795 both request $100.0 for NMED for an environmental planning assessment for the Molycorp remediation and closure plan. 

 

POSSIBLE QUESTIONS

 

1.  Are the activities funded by this bill the same as those funded in House Capital Outlay Request 1239 and Senate Capital Outlay Request 795?  

LP/prr/ls