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F I S C A L I M P A C T R E P O R T
SPONSOR Martinez, R.
ORIGINAL DATE
LAST UPDATED
1/19/08
1/22/08 HB
SHORT TITLE Residential Energy Conservation Program
SB 211
ANALYST Leger
APPROPRIATION (dollars in thousands)
Appropriation
Recurring
or Non-Rec
Fund
Affected
FY08
FY09
$5,000.0 Non-Recurring
General Fund
(Parenthesis ( ) Indicate Expenditure Decreases)
Relates to Appropriation in the General Appropriation Act
SOURCES OF INFORMATION
LFC Files
Responses Received From
New Mexico Mortgage Finance Authority (MFA)
SUMMARY
Synopsis of Bill
Senate Bill 211 appropriates $5 million from the general fund to the Department of Finance and
Administration for expenditure in FY09 & FY10 for disbursement to the New Mexico Mortgage
Finance Authority (MFA) to provide a residential energy conservation program to increase the
energy efficiency and reduce energy expenditures of homes occupied by low-income persons in
New Mexico.
FISCAL IMPLICATIONS
The appropriation of $5 million contained in this bill is a non-recurring expense to the general
fund. Any unexpended or unencumbered balance remaining at the end of FY10 shall revert to the
general fund. No more than five percent of the appropriation may be used by MFA for
administrative expense. MFA will expend the funds over a two-year period to create and
implement a residential energy conservation program for low-income households.
pg_0002
Senate Bill 211 Page
2
SIGNIFICANT ISSUES
According to MFA this bill provides additional funding to the New Mexico Energy $mart
program which increases the energy efficiency and reduces the residential energy costs of homes
occupied by low-income people, while improving their health and safety.
PERFORMANCE IMPLICATIONS
MFA reports the following funding for NM Energy$mart (Weatherization Assistance Program):
FUNDING FOR 2007
DOE $1,874,902 (received 7/07)
STATE Funding (DFA Budget) $ 800,000 (received 10/07)
LIHEAP Funding $ 710,000 (received 2/07)
LIHEAP Funding $ 693,506 (received 6/07)
PNM Gas Energy Efficiency Act Funding $ 823,453
(received 12/07)
Total Funding: $5,126,861
PRODUCTION
1607 homes have been weatherized with this funding from the months of 7/06 through 6/07
PROPOSED FUNDING FOR 2008
DOE $1,714,483
STATE (DFA Budget) $ 800,000
LIHEAP $1,402,056
PNM Gas Energy Efficiency Act Funding $ 823,453 (1/1/08 12/31/08)
PNM Electric Energy Efficiency Act Funding $ 225,000 (1/1/08 6/30/08)
PNM Electric Energy Efficiency Act Funding $ 450,000 (7/1/08 6/30/09)
If the requested funding of $5,000,000 is added into the estimates, it would equate to
approximately 1,800 additional households being assisted. Without the funding requested, that
many households would not receive assistance.
ADMINISTRATIVE IMPLICATIONS
The MFA will continue to administer the program.
WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL
According to MFA this bill proposes to address the substantial unmet demand for energy
conservation assistance throughout the state. Accordingly, a direct consequence of not enacting
this bill would be a reduction of 1,800 units to the number of low-income households that could
be assisted. The result is more of those household being faced with high energy bills and
continuing health and safety hazards in their homes. Combined savings for energy and non-
energy benefits in 2006 shows NM Energy $mart returns at $2.69 for every $1 invested. At
current prices, home energy savings average $358 per year.
pg_0003
Senate Bill 211 Page
3
Funding in the NM Energy $mart program is heavily leveraged, meaning that $1 in funding from
the State can actually mean as much as $3 to the program. Without the proposed funding,
subgrantees will be forced to lay off employees which will be a detriment to the numbers of
households being assisted by all of the other funding sources.
JLL/mt