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

SPONSOR Martinez

ORIGINAL DATE

LAST UPDATED

2-10-06

HB

SHORT TITLE Expand Weatherization Programs

SB 24

ANALYST Hadwiger

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$700.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to Appropriation in the General Appropriation Act for $800.0 for weatherization.

Duplicates/relates to HB148.

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Finance and Administration (DFA)

Human Services Department (HSD)

SUMMARY

Synopsis of Bill

Senate Bill 24 appropriates $700 thousand from the general fund to the Department of Finance

and Administration in FY07 for disbursement to the New Mexico Mortgage Finance Authority

(MFA) to expand the weatherization assistance program to increase the energy efficiency and

reduce energy expenditures of homes occupied by low-income persons in New Mexico. No

more than five percent of the appropriation could be used by MFA for administration.

FISCAL IMPLICATIONS

The appropriation of $700 thousand contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of FY07 would revert to

the general fund.

Senate Bill 24 – Page 2

SIGNIFICANT ISSUES

HSD indicated MFA administers the Department of Energy’s weatherization funds and the De-

partment of Health and Human Services LIHEAP funds for the purpose of weatherizing the

homes of low-income New Mexicans. This bill would increase the energy efficiency and reduce

energy expenditures of homes occupied by low-income persons in New Mexico.

DFA noted that MFA has been responsible for the weatherization program since 1997. The pro-

gram serves families earning up to 150 percent of the poverty level. Currently, the national pov-

erty level for a family of four is $29,025. Therefore, under this program, a family of four earning

up to $36,280 would be eligible for participation in the weatherization assistance program.

Weatherization includes such items as replacement of windows, furnaces, and water heaters.

Five percent ($35,000) of the allocation can be used by MFA for administrative costs, leaving

$665,000 for program-related expenses. The average cost to weatherize a house in $2,800, thus

an estimated 235 New Mexican families would have their homes weatherized with this alloca-

tion. MFA will award grants to local community organizations that will do the actual weatheri-

zation work with MFA providing oversight.

ADMINISTRATIVE IMPLICATIONS

The grant will be administered through DFA which already has the staff and the knowledge to

easily fund and monitor this project.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates HB148.

TECHNICAL ISSUES

DFA suggested amending the bill on Line 17 to add the phrase "local government division in

the" between “the” and “department”.

OTHER SUBSTANTIVE ISSUES

According to DFA, due to high heating costs, the weatherization program for those more vulner-

able populations is desperately needed.

DH/nt:mt