Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports if they are used for other purposes.

 

Current FIRs (in HTML & Adobe PDF formats) are available on the NM Legislative Website (legis.state.nm.us).  Adobe PDF versions include all attachments, whereas HTML versions may not.  Previously issued FIRs and attachments may also be obtained from the LFC in Suite 101 of the State Capitol Building North.

 

 

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

 

 

 

SPONSOR

SPAC

DATE TYPED

02-11-04

HB

 

 

SHORT TITLE

Nursing Home and Care Facility Tax Credits

SB

436/SPACS

 

 

ANALYST

Taylor

 

 

REVENUE

 

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY04

FY05

 

(2,000.0)

Increasing

Recurring

General Fund

(Parenthesis ( ) Indicate Revenue Decreases)

 

Duplicates HTRC substitute for HB 547

 

SOURCES OF INFORMATION

LFC Files

 

Responses Received From

Taxation and Revenue Department (TRD)

 

SUMMARY

 

The Senate Public Affairs Committee Substitute for Senate Bill 436 creates an income tax credit for expenses paid to licensed nursing homes, licensed intermediate care facilities for the mentally retarded and licensed residential treatment centers.  The credit is refundable and limited to $10 per day. 

 

Provisions of the bill are applicable to taxable years beginning on or after January 1, 2004 and do not apply after January 1, 2008, but expenses incurred before July 1, 2004 and after June 30, 2007 are not eligible for the credit.  The bill has a delayed repeal, effective July 1, 2008.

 

FISCAL IMPLICATIONS

 

TRD reports research indicating that there are 8,400 beds for the kind of facilities that would be eligible for the tax credit.  They assume that 10 percent, or 840 beds are private pay. They assume a 90 percent occupancy rate, implying 756 occupied beds. Some private pay beds are financed by insurance and some by individuals.  TRD assumes that about three-quarters are paid for by individuals.  Multiplying 756 by three quarters by $10 dollars by 365 yields just over $2.0 million.

ADMINISTRATIVE IMPLICATIONS

 

TRD reports modest administrative impacts that can be absorbed with existing resources.

 

BT/dm