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

SPONSOR Moore

DATE TYPED 2/8/2005 HB 403

SHORT TITLE Water Trust Fund

SB

ANALYST Aguilar

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

$100,000.0 Indeterminate

Recurring General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB139

SOURCES OF INFORMATION

LFC Files

Responses Received From

Office of the State Engineer

SUMMARY

FOR THE WATER AND NATURAL RESOURCES COMMITTEE

Synopsis of Bill

House Bill 403 appropriates $100 million dollars from the general fund to the Water Trust Fund

for the purposes of the Water Project Finance Act.

HB 403 declares an emergency.

Significant Issues

The Water Trust Board was created to fund major regional water projects in New Mexico. Ten

percent of the severance tax bond sales are set aside for the water trust fund, from which, the

Water Trust Board funds its projects.

House Bill 403 -- Page 2

Section 72-4A-8 NMSA 1978 provides for funds in the Water Trust Fund not to be expended but

instead an annual distribution of $4,000,000 (or 4.7% of the average year end market value of the

fund for the past five years if greater than $4,000,000) to the Water Project Fund for funding wa-

ter projects.

The Office of the State Engineer reports the Water Trust Board, which oversees the Water Pro-

ject Fund, received $814 million in requests for funds in 2004 and the New Mexico Finance Au-

thority estimates that the state has over $2.5 billion in water project needs

FISCAL IMPLICATIONS

The appropriation of $100 million dollars contained in this bill is a recurring expense to the gen-

eral fund. Any unexpended or unencumbered balance remaining at the end of fiscal year 2006

shall not revert to the general fund.

PAA/njw