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

SPONSOR Sanchez, B

ORIGINAL DATE

LAST UPDATED

02/04/08

HB

SHORT TITLE Create Interim Process & Law Committee

SB 528

ANALYST Escudero

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$90.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Administrative Office of District Attorney (AODA)

Attorney General Office (AGO)

Commission of Public Records (CPR)

Public Education Department (PED)

Department of Environment Information Technology (DoIT)

SUMMARY

Synopsis of Bill

Senate Bill 528 creates a ten member joint interim legislative "Regulatory Process and

Administrative Law Committee" of the State Legislature. The Committee will function from

the date of its appointment until December 15 prior to the first session of the fiftieth

legislature. The members will be appointed from the Senate and House of Representatives.

The Committee shall:

•

conduct a continuing study of the benefits and challenges of existing agency

regulatory process and structure;

•

review the model Administrative Procedures Act and other regulatory process

legislation;

•

recommend any necessary legislative action to improve regulatory processes,

including a time line for implementation of any recommended changes; and

•

make a full report of its findings and recommendations.

Senate Bill 528 – Page

2

Staff will be provided by the Legislative Council Service and the Director of the

Administrative law Division of the State Records Center and Archives.

FISCAL IMPLICATIONS

The appropriation of $90.0 contained in this bill is a recurring expense to the general fund. Any

unexpended or unencumbered balance remaining at the end of FY09 shall revert to the general

fund.

According to CPR, Senate Bill 528 could have a fiscal impact on the commission of public

records if the director of the administrative law division were to provide staff support for the

committee. The size of the fiscal impact is difficult to quantify because it is not known what

type of service will be required by the committee. The appropriation is made to the LCS; no

provision is made for any costs incurred by the commission

According to DoIT, it is not possible at this time to quantify the fiscal implications SB 528

would have on the Environment Department. In the short term, there will be no fiscal impact on

the Environment Department. Depending on the actions of the Committee, the fiscal

implications could be significant in the long term.

SIGNIFICANT ISSUES

According to AGO, the State Records Center and Archives and its divisions is part of the

Executive Branch of state government. See NMSA Section 14-3-8 (1978). This bill would

require the Director of its Administrative Law Division to provide staff support for a legislative

committee. Requiring an executive agency to provide staff for a legislative committee may

violate Article III Section 1 of the New Mexico Constitution, commonly referred to as the

“Separation of Powers" clause.

According to CPR, Senate Bill 528 would create a legislative interim committee to study

regulatory processes in the state. The committee would also recommend legislative changes.

The bill stipulates that staff shall be provided by the LCS and the director of the administrative

law division of the "state records center and archives" (statutory name of the agency is

commission of public records). The commission has two concerns.

•

First, the administrative law division is small, with only five employees. Depending on

the extent of the staff support expected, it could become a burden that could interfere

with the division's ability to conduct its work. The agency appreciates the opportunity to

participate in the process, but would prefer language providing for an advisory role,

rather than staff support.

•

Second, the bill names the director of the administrative law division. When it references

the LCS, it simply refers to the agency; it does not specify the director. The commission

would prefer that the reference be to the agency - the state commission of public records -

not to the director of a division.

As stated by AODA, the process of application of the Administrative Procedures Act and various

agencies’ regulatory schemes are often the first stages of administrative penalties and possible

serious ramifications to licensing, therefore care should be made to properly comprise any study

committee with a fair cross section of those possibly affected.

Senate Bill 528 – Page

3

Interim Committees may be helpful if the topic to be studied needs studying. If not, the

legislative effort is seen as bureaucracy.

As stated by PED, Senate Bill 528 proposes to analyze and recommend improvements to current

state regulatory processes of the various state agencies. Senate Bill 528 is less sweeping than

other legislative attempts to revamp state regulatory processes such as HB 685 (Administrative

Accountability Act) introduced in 2007’s 60-day session, which proposed detailed procedures for

agencies to follow and numerous requirements on agencies related to rulemaking, adjudications,

fees and licenses. It is also less far-reaching than House Joint Resolution 12, Senate Joint

Resolution 5 and Senate Joint Resolution 7, which propose a constitutional amendment allowing

an interim or standing committee to annul an agency rule if the committee finds that the agency

or officer of the executive branch was not “authorized" to adopt the rule. Senate Bill 528 also

does not immediately set requirements for agencies as does HB 310 (requiring that agencies

prepare a regulatory impact statement if a proposed rule has an economic impact of more than

$25.0) or HB 614 (requiring agencies to conduct and review an economic impact study of a

proposed rule or amendment).

Senate Bill 528 would at most result in a report on current state regulatory processes and

recommendations for improvement which may be taken by future legislation. Any review or

study of current processes would necessarily be extensive because state agency regulatory

processes vary from one agency to another. Most agency enabling statutes provide the cabinet

secretaries with their own rulemaking authority and rulemaking processes are promulgated by

each agency.

A review of the model Administrative Procedures Act may provide recommendations for

changes in state regulatory procedures including uniformity of regulatory processes throughout

the various state agencies. New Mexico’s current Administrative Procedures Act only applies to

agencies made subject to its coverage by law, or by agency rule or regulation.

According to DoIT, potential issues could arise if the actions of the Committee resulted in the

Legislature taking on executive branch duties. Executive commissions and boards in New

Mexico are provided the duty of promulgating regulations, including regulations that dictate

administrative procedures for those actions appearing before the commissions and boards. If the

legislative committee strayed too far from its primary duties of passing legislation and began

infiltrating into the executive regulatory arena, constitutional issues could arise.

PERFORMANCE IMPLICATIONS

As stated by CPR, the performance of the administrative law division in the commission of

public records could be affected if the director were to spend any significant providing staff

support for the committee. Please see Significant Issues, above.

As stated by DoIT, short-term, there are no performance implications for the Environment

Department. Long-term, there could be significant performance implications if administrative

procedural changes were made based upon Committee findings. Such changes would entail

regulation promulgation, training, public outreach and possibly staffing issues, which would all

affect the performance of Department employees. Alternatively, it is possible that revisions to

administrative procedures could make employee performance smoother and more efficient.

Senate Bill 528 – Page

4

ADMINISTRATIVE IMPLICATIONS

According to CPR, the performance of the administrative law division in the commission of

public records could be affected if the director were to spend any significant providing staff

support for the committee. Please see Significant Issues, above.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

SB 528 relates to SB 57, SB 535, SJR 5, SJR 7, HB 310, HB 614, and HJR 12.

As stated by PED, this bill relates to HJR 12, SJR 5 and SJR 7, which propose an amendment to

the New Mexico Constitution which, if approved, would allow the Legislature to, by law,

prohibit regulatory rules proposed by an agency or officer of the executive branch from taking

effect until the proposed rules were reviewed and approved by the appropriate interim or

standing committees of the Legislature.

It also relates to/conflicts with HB 310, which would amend the State Rules Act by adding a

requirement that agencies prepare a regulatory impact statement if a proposed rule has an

economic impact of more than $25.0.

It also relates to/conflicts with House Bill 614, which requires all agencies to, prior to the

adoption or amendment of any rule, conduct and review an economic impact study of costs,

benefits and impacts of the proposed rule or amendment.

ALTERNATIVES

According to DoIT, an alternative to the Committee would be to have a broad-based group of

participants who have experience with administrative procedure and processes report their

viewpoints to the Legislature. That would allow for an accurate evaluation of the current

system(s), and would give the Legislature a greater understanding of what would be within its

power to change.

PME/bb