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SPONSOR: |
Kidd |
DATE TYPED: |
1/29/02 |
HB |
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SHORT TITLE: |
Eddy County Property Sale By EMNRD |
SB |
SJR 13 |
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ANALYST: |
Trujillo |
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REVENUE
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Estimated
Revenue |
Subsequent Years Impact |
Recurring or Non-Rec |
Fund Affected |
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FY02 |
FY03 |
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|
|
|
|
$0.1
Indeterminate |
Indeterminate |
N/A |
OSF |
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|
|
|
|
|
(Parenthesis ( ) Indicate Revenue Decreases)
LFC Files
Responses Received From:
Energy, Minerals and Natural Resources
Department (EMNRD)
Commissioner of Public Lands (CPL)
State Engineer (SE)
SUMMARY
Synopsis
of Bill
Senate
Joint Resolution 13 provides legislative approval pursuant to
NMSA 1978, §13-6-3 for the sale of approximately 1,000 acres of real property
in Eddy County currently owned by the State Parks Division (SPD) of the Energy,
Minerals and Natural Resources Department (EMNRD). The joint resolution provides that the property is to be sold for
its fair market value, is to be appraised before sale, and any sale is to be
reviewed and approved by the state Board of Finance. The resolution notes that the property is valued in excess of
$100,000 and therefore requires the approval of the Legislature before sale. It is not a state park and does not fit the
criteria for becoming a state park and notes the legal description of the
property.
Significant
Issues
EMNRD
reports the Cottonwood Walnut property was purchased in 1972 for the proposed
development of Cottonwood Walnut Creek State Park. This project was to be developed in partnership with the Soil
Conservation Service, now the Natural Resources Conservation Service (NRCS), to
construct a dam. The cost of
recreational facilities was to be split equally between the state and the
NRCS. Based on research in 1984, the
state’s share of participation in this project would have exceeded a million
dollars. Since its purchase nearly
thirty years ago, there has been no funding for development or operation of the
property.
In
1987 Brantley Dam was completed and a state park was opened there, only thirty
miles from Cottonwood Walnut; given the financial limitations of the SPD there
is little need to create another state park in this area.
The
SPD has no plans to develop this property into a state park as it does not
contain a diversity of resources and would not provide recreational
opportunities significant enough to assure patronage from the region or the
state as a whole. The property does not
conform to the state comprehensive outdoor recreation plan and therefore does
not fit the criteria for development as a state park pursuant to NMSA 1978,
§16-2-11.
During
the 45th Legislature, first session, Senate Joint Resolution 4 was passed and
signed by the Governor to allow the State Parks Division to purchase lands
adjacent to Coyote Creek, Oliver Lee and Pancho Villa State Parks. Through the Land and Water Conservation
Funds (LWCF), New Mexico was allocated $433,148.00 to partially fund the
acquisitions of adjacent lands, which would protect these parks natural, cultural
and historical attributes through encroaching urbanization. The LWCF funding requires that the state
provide matching funds to meet the state obligation for funding. The revenue generated from the sale of Cottonwood
Walnut would be utilized for the state’s match of the federal funding.
According to SE, the
land that is owned by EMNRD in excess of 600 acres of water rights appurtenant
to it. The appraisal of the land that is owned by EMNRD should include the
value of the water rights. Also, an analysis by the Interstate Stream
Commission should be allowed to determine whether the water rights have been
used in recent years and whether retirement or use of the water rights would be
either useful or detrimental, respectively, in meeting Pecos River Compact
deliveries.
PERFORMANCE
IMPLICATIONS
EMNRD reports passage
of this resolution would allow the SPD to expand its cultural, historical and
natural resource educational and interpretive programs at Coyote Creek, Oliver
Lee and Pancho Villa. Failure to secure
lands adjacent to these parks may allow the opportunity for encroachment by
developers. This could affect
visitation and revenue. Performance
measures that could be affected are: number of visitors to state parks
(output); percent of general fund to total fund (explanatory); self-generated
revenue per visitor (explanatory); number of interpretive programs available to
park visitors (output); and number of visitors participating in interpretive
programs, including displays at visitor centers and self-guided tours (output).
SE reports the resolution would not have a
significant impact on the agency, unless further analysis of the water rights
and water use impacts on compact deliveries by the Interstate Stream Commission
is allowed.
However, for future reference, if the water
rights have not been fully utilized, and if the land and water rights are sold
to a party that would fully utilize the water rights, then sale of the property
might reduce New Mexico’s ability to meet its Compact deliveries to Texas. This could result in a need for the
Interstate Stream Commission to acquire and retire additional water rights to
meet performance targets in Compact deliveries. On the other hand, if the rights have been fully utilized and the
rights are retired separate from the land sale, then New Mexico’s ability to
perform under the compact could be enhanced.
FISCAL IMPLICATIONS
According to EMNRD,
the sale of the Cottonwood Walnut property would create a revenue source that
would be utilized to match federal funds for the purchase of lands adjacent to
the three state parks.
Although no formal
appraisal on this property has been performed, quotations from three realtors
in the Artesia area range from $847,600.00 to $1,039,000.00. These quotes are based on 360 acres of
artesian water rights and 638 dry-land acres.
SE indicates the State of New
Mexico could benefit financially from the sale of the land and the water
rights. However, if the water rights have not been fully utilized, and if the
land and water rights are sold to a party that would fully utilize the water
rights, then sale of the property might reduce New Mexico’s ability to meet its
Compact deliveries to Texas and result in a need for the Interstate Stream
Commission to acquire and retire additional water rights to meet performance
targets in Compact deliveries. If the water rights have been fully used the New
Mexico Interstate Stream Commission would have to analyze the water rights to
see if they could be retired or used in another way for compact deliveries.
Based on past water rights purchases made by the Interstate Stream Commission
to increase state line flows under the Compact, purchase costs may range up to
$3000 per acre or more.
ADMINISTRATIVE IMPLICATIONS
EMNRD reports the SPD currently houses the
Region 4 office on four acres of this property. It is the intent of the SPD to relocate this office to the EMNRD
Oil Conservation Division field office in Artesia.
SE recommends defining
exactly what the water rights of the property are and suggests amending the
resolution to
require the Interstate Stream Commission to investigate use
of the water rights and impacts of changes in use of the water rights on state
line flows to Texas under the Pecos River Compact.
OTHER SUBSTANTIVE ISSUES
EMNRD reports if the SPD is not able to sell the
Cottonwood Walnut property, it would be required to request special
appropriation for the purchase of lands adjacent to state parks. This would most likely occur during a
convened legislative session. When
private property comes available for sale, the SPD must be in position to
purchase such land, otherwise it could be sold to a private individual or
entity.
Failure to purchase lands adjacent to state
parks could allow urbanization encroachment, thus having a negative impact on
cultural, historical and natural resources.
It may also lead to a decline of visitation and revenue.
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