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SPONSOR: |
Taylor, J. G. |
DATE TYPED: |
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HB |
835/aHAFC |
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SHORT TITLE: |
NMFA Water & Wastewater Project Grants |
SB |
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ANALYST: |
Kehoe |
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APPROPRIATION
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04 |
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See
narrative |
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See
narrative |
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(Parenthesis
( ) Indicate Expenditure Decreases)
Relates Senate Bill 292, Senate Bill 273 and House
Bill 90
Duplicates Senate Bill 294
Legislative
Finance Committee Files (LFC)
SUMMARY
Synopsis
of HAFC Amendment
House Appropriations and Finance Committee
amendment to House Bill 835 deletes the $150 million appropriation and makes
several non-substantive corrections to the original bill.
Additionally HB 835/aHAFC adds new qualified
entities whereby the New Mexico Finance Authority may make project grants from
the water and wastewater project fund as outlined below:
116. to the
117. to the Rowe mutual domestic water consumers association for a water project in San Miguel county;
118. to Cordova for a wastewater project in Rio Arriba county;
119. to
120. to the city of
121. to the town of
122. to the La Loma mutual domestic water consumers association for a water project in Guadalupe county;
123. to Grant county for a wastewater project in Grant county;
124. to Shiprock for a wastewater
project in
125. to the city of
126. to the
127. to the Vadito mutual domestic
water consumers association in
128. to the Arroyo Hondo domestic
water consumers association in
129. to El Salto domestic water
consumers association in
130. to the Jemez Springs domestic cooperative in Sandoval county for a water project;
131. to
132. to the Sile mutual domestic water consumers association in Sandoval county for water projects.
Synopsis
of Original Bill
House Bill 835
appropriates $150 million from the general fund to the Water & Wastewater
Project Grant Fund for the purpose of granting funds for water & wastewater
projects to qualified entities statewide; authorizes NMFA to provide grants to
eligible entities for 116 projects statewide; voids authorization unless
entities notify NMFA by the end of fiscal year 2005 of their desire to pursue a
grant; and contains an emergency clause.
Significant
Issues
The Water and Wastewater Facility Grant Fund
Program (WWGF) administered by NMFA was created by the 1999 Legislature for the
purpose of awarding grants for water and wastewater projects to qualified
entities. The authorization provided in
House Bill 835 does not guarantee that the entities or projects will be awarded
a grant by NMFA. Applicants are screened
by NMFA based on rules approved by the NMFA governing board and NMFA
Legislative Oversight Committee. An
entity’s financial capability, the average water or wastewater rates charged
and the entity’s median household income could affect the amount of grant
funding eligibility for each project.
Under current law, NMFA is allowed to make a limited number of emergency
water and wastewater project grants for up to $3 million per fiscal year from
WWGF without legislative authority.
The WWGF may also be used to combine NMFA’s
low-cost, low-interest rate loan financing with grants for water and wastewater
projects. If a qualifying entity is
unable to finance a project fully with loan funds, the entity could apply for a
partial grant from grant funds and a partial loan from the Public Project Revolving
Loan Fund (PPRF). A local match could be
determined by a sliding scale based on the applicant’s financial capability to
repay a portion of the project from local resources. Laws 2002, Chapter 23, broadened the terms
and condition for determining local match requirements for grants made from the
WWGF. Provisions allow a qualified
entity to receive a grant on behalf of another entity or other water systems
based on the financial capacity of the residents of that geographic area
benefiting from proposed improvements.
The new definition allows the consolidating of small water and
wastewater systems, discourages proliferation of multiple systems, and allows
small entities to hook up to larger neighboring systems rather than creating
and maintaining their own system.
FISCAL IMPLICATIONS
House Bill 835
appropriates $150,000.0 from the general fund to the Water and Wastewater Grant
Fund. Projects contained in House Bill 835
indicate that $350 million is needed to fund water and wastewater projects
statewide.
The 2002 Legislature appropriated $15 million to the Water & Wastewater Grant Fund. However, the bill providing legislative authority for awarding grants failed to pass the Senate. To date, approximately $6 million of the funds have been expended for emergency projects in fiscal years 2002 and 2003. A balance of $9 million remains in the fund.
RELATIONSHIP
Senate Bill 292
authorizes NMFA to make loans for certain statewide infrastructure projects
from the Public Project Revolving Fund.
If entities seeking financial assistance from NMFA do not qualify for a
grant, it is possible the same entity is listed within Senate Bill 292 seeking
legislative authorization for a loan.
Senate Bill 273
proposes to temporarily increase from $3 million to $5 million the amount NMFA
may disburse per fiscal year for emergency projects without legislative
authority. If approved, the increase
would be in effect for fiscal years 2003 through 2006.
Senate Bill 294
duplicates House Bill 835.
House Bill 90 bill
appropriates $1 million from the general fund to NMFA’s planning fund for
feasibility studies for water and wastewater planning.
LMK/njw