NOTE:  As provided in LFC policy, this report is intended only for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used for other purposes.

 

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

 

 

 

SPONSOR:

Nava

 

DATE TYPED:

02/04/03

 

HB

 

 

SHORT TITLE:

NMSU Nursing Education Funding

 

SB

94

 

 

ANALYST:

Williams

 

APPROPRIATION

 

Appropriation Contained

Estimated Additional Impact

Recurring

or Non-Rec

Fund

Affected

FY03

FY04

FY03

FY04

 

 

 

$500.0

 

 

Recurring

General Fund

 

 

 

 

 

 

(Parenthesis ( ) Indicate Expenditure Decreases)

 

Relates to SB 291, HB 255, HB 385

 

SOURCES OF INFORMATION

 

Responses Received

 

LFC Files

Health Policy Commission

New Mexico State University (NMSU)

Commission on Higher Education (CHE)

State Department of Education

 

SUMMARY

 

     Synopsis of Bill

 

Senate Bill 94 appropriates $500.00 from the general fund to New Mexico State University for the purpose of maintaining nursing faculty salaries and increasing the number of faculty positions to maintain and expand student enrollment in the nursing program.  Specifically, nursing faculty salaries are targeted at the 50th percentile of peer institutions.

 

     Significant Issues

 

In 2002, the Nursing Shortage Statewide Strategic Summit of the Commission on Higher Education and the University of New Mexico Health Sciences Center noted the importance of expanding nursing education program by increasing faculty and enhancing faculty retention through salary adjustments.  Specifically, the Summit calls for an incremental 500 licensed nurse graduate per year (doubling of current levels) beginning in three years and continuing for fifteen to twenty years.

 

FISCAL IMPLICATIONS

 

The appropriation of $500.0 contained in this bill is a recurring expense to the general fund.  Any unexpended or unencumbered balance remaining at the end of FY 2004 shall revert to the general fund. 

 

For FY 04, NMSU requested an additional $500.0 nursing expansion and ranked the proposal 7th of 17 new or expansion research and public service projects submitted to CHE by NMSU.  In its analysis, CHE notes the appropriation would support up to eight new faculty FTE positions at current market salary levels.

 

According to the LFC budget document, over the past couple of years, the Legislature has appropriated funds to institutions to address statewide nursing workforce needs.  The Legislature appropriated a total of $2,569.8 in FY03 to provide market salary adjustments for nursing faculty, convert nursing faculty from a nine-month contract to a 12-month contract, and expand nursing student enrollments for two-year and four-year institutions, other than the University of New Mexico.  NMSU received $419.2, of which 85 percent was allocated to provide market salary adjustment for nursing faculty and 15 percent was allocated to expand nursing student enrollment.  NMSU Alamogordo received $27.9, with 71.4 percent allocated to provide market salary adjustments for nursing faculty and 28.6 percent allocated to expand nursing student enrollment.  NMSU Carlsbad received $34.9 for market salary adjustment for nursing faculty.  Finally, NMSU Dona Ana received $104.8, equally split between market salary adjustments for nursing faculty and expansion of nursing student enrollment.

 

For those institutions that did not use the funds appropriated in FY03 to expand nursing student enrollments, the LFC recommended institutions expand nursing enrollment in FY04.  The LFC budget recommendation for FY04 includes $419.2 for NMSU nursing expansion, $27.9 for NMSU Alamogordo nursing expansion, $34.9 for NMSU Carlsbad nursing expansion and $104.8 for NMSU Dona Ana nursing expansion.

 

OTHER SUBSTANTIVE ISSUES

 

In their analysis, NMSU, Health Policy Commission and State Department of Education note the national and state nursing shortage, and NMSU notes partnership efforts between the Main and branch campuses to address career development and retention in “rural/frontier communities”.  Further, NMSU discusses a new distance education methodology for the nursing program initiated with federal grant funds, which will require additional future funding “to allow progression of admitted nursing students and to cover costs for the program after (federal) funding ends.”

 

As a result of the appropriation, NMSU notes annual enrollment in the four-year Bachelor of Science nursing program would increase from 32 to 48 students per semester, with completion program enrollments increasing to 40 per year in 2004 and 48 per year in 2005.

 

 

ALTERNATIVES

 

In its analysis, CHE notes it did not recommend additional nursing expansion requests in FY04, but instead recommended the revised education funding formula.  The Plus Incentives component of the new formula includes establishment of the Program Development Enhancement Fund.  For this fund, the CHE recommended initial funding of $3 million, while the LFC recommendation includes $1.5 million of general fund and $1.0 million of federal funds in the form of temporary assistance for needy families block grant.  

 

POSSIBLE QUESTIONS

 

  1. What would be the associated impacts on institutional revenues and formula funding?

 

AW/njw