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.
The most recent FIR
version (in HTML & Adobe PDF formats) is available on the Legislative
Website. The Adobe PDF version includes
all attachments, whereas the HTML version does not. Previously issued FIRs and attachments may be
obtained from the LFC in
SPONSOR: |
Sharer |
DATE
TYPED: |
|
HB |
|
||
SHORT
TITLE: |
Economic
Stimulus Bonding Act |
SB |
612 |
||||
|
ANALYST: |
Smith |
|||||
REVENUE
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
|
FY03 |
FY04 |
|
|
|
|
(50,000.0) |
|
Recurring |
General Fund (Ending Balance) |
|
(5,500.0) |
|
Recurring |
General Fund (Gross receipts) |
|
(55,000.0) |
|
Recurring |
Economic Stimulus
Bonding Fund |
(Parenthesis ( ) Indicate Revenue Decreases)
LFC
Files
SUMMARY
Synopsis of Bill
Senate Bill 614 allows
the NMFA to issue “economic stimulus anticipation bonds” in an amount not to
exceed $500 million. The bonds are payable from excess general fund revenue and
shall have a differential rate as is consistent under the statutes governing
the Severance Tax Permanent Fund-only the STPF can purchase the bonds.
Excess General Fund
Revenue is defined as ¼ of 5% of prior year appropriations. Presumably, this
distribution shall be made from general fund reserve balances. In any case,
$5.5 million of the general fund gross receipts tax distribution shall be
distributed to the new bonding fund.
FISCAL IMPLICATIONS
This is a companion
piece to the sponsor’s tax cut legislation. Using a $4 billion estimate for appropriations
leads to the $50 million estimate in the revenue table.
OTHER SUBSTANTIVE ISSUES
Since the transfer is
predicated on appropriations, it is not clear what the link is to the economic
development motives noted in the legislative findings section.
The other non-market
rates STPF investments are heavily collateralized. It is unclear whether this
proposal would conflict with the prudent investor rule that governs the
investment of the permanent funds.
SS/yr