44th legislature - STATE OF NEW MEXICO - second session, 2000

REQUESTING STATE AGENCIES AND THE LEGISLATIVE FINANCE COMMITTEE TO STUDY ALL PRIVATIZATION PROPOSALS OF STATE GOVERNMENT.

WHEREAS, privatization of government services should not be undertaken solely to shrink the size of government; and

WHEREAS, privatization should only be considered after careful thought and assurances that the cost of providing services will be significantly less and citizens will benefit significantly more than being served by a state agency; and

WHEREAS, as part of the cost-benefit analysis, a state agency should consider the effects of privatization on state employees, local governments and other entities and on existing service contracts; and

WHEREAS, state agencies are constrained in their ability to privatize in that they cannot constitutionally or statutorily delegate their authority and responsibility, including their authority to determine policy;

NOW, THEREFORE, BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO that each state agency that considers privatization of an activity perform a cost-benefit analysis and evaluate its proposal in light of:

A. the potential one-time and annual recurring savings, and whether those savings are substantial enough to warrant privatization;

B. the potential market for the activity;

C. relative strengths and weaknesses of governmental and private sector customer service and client protection mechanisms;

D. the effect of possible reduced service delivery on the citizens of New Mexico;

E. the effect on unemployment in an area and the state, including number and effects of displacement on state workers;

F. the effect on local governments and existing contractors; and

G. other pertinent fiscal and socioeconomic factors; and

BE IT FURTHER RESOLVED that the state budget division and the management and contracts review bureau of the department of finance and administration, and the state purchasing division as applicable, evaluate any privatization proposals to ensure that the state agency's authority, responsibility or policy-making functions are not being delegated; and

BE IT FURTHER RESOLVED that the state agency provide copies of its cost-benefit analysis to the legislative finance committee for review before taking action to privatize an activity; and

BE IT FURTHER RESOLVED that copies of this memorial be transmitted to the legislative finance committee for appropriate distribution.