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F I S C A L I M P A C T R E P O R T
SPONSOR Begaye
DATE TYPED 02/24/05 HB 584
SHORT TITLE Native American Resident Student Definition
SB
ANALYST Williams
APPROPRIATION
Appropriation Contained Estimated Additional Impact Recurring
or Non-Rec
Fund
Affected
FY05
FY06
FY05
FY06
Indeterminate,
but could be
large and esca-
lates over time;
see text
Recurring
General Fund -
Higher educa-
tion funding
formula
Indeterminate,
but could be
large and esca-
lates over time;
see text
Recurring
General Fund -
Cost of tuition
waiver
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
LFC Files
Commission on Higher Education (CHE)
Department of Indian Affairs (DIA)
SUMMARY
Synopsis of Bill
House Bill 584 expands the definition of “resident student” for the purposes of tuition payment
and budget and revenue calculations at the state’s post-secondary educational institutions to in-
clude members of Indian nations, tribes and pueblos located wholly or partially in New Mexico
regardless of actual residence prior to acceptance by the institution. The status would apply to
both undergraduate and graduate students attending only those institutions designated in Article
12, Section 11, specifically University of New Mexico, New Mexico Highlands University,
Western New Mexico University, Eastern New Mexico University, the New Mexico Institute of
Mining and Technology, New Mexico Military Institute, New Mexico School for the Blind and
Visually Impaired, New Mexico School for the Deaf and Northern New Mexico State School.
pg_0002
House Bill 584 -- Page 2
Significant Issues
The Department of Indian Affairs notes “HB 584” is an executive agency bill. The proposed
legislation was formally endorsed by the Commission on Indian Affairs.”
Further, the Department of Indian Affairs notes the legislation “would eliminate the instances
where tribal members attend out-of-state universities for their undergraduate studies, and return
home to New Mexico to attend law school, medical school or other post-graduate studies and are
then subject to non-resident tuition.” The extent to which these individuals might be offered a
graduate assistantship which effectively provides a non-resident tuition waiver is not insignifi-
cant.
Note existing statute already authorizes tuition to be charged at resident rates at New Mexico
Highlands University for any Native American who is a citizen of the United States.
Eligible Groups.
Due to the existence of the Navajo Nation non-resident tuition waiver program, the bill would
effectively apply to members of all New Mexico tribes, regardless of residence, at the time of
admission. The Department of Indian Affairs notes “most, if not all, of these individuals and
their children maintain their ties to their traditional homeland and culture and intend to return
directly to their own communities or to neighboring cities/towns”; thus, the potential eligible
population under the provisions of the bill as currently written is quite large.
FISCAL IMPLICATIONS
The bill does not contain an appropriation; however, the fiscal impact would have two compo-
nents. The first would likely be a non-recurring surge of cohorts due to pent-up demand for ac-
cess to higher education opportunities. The second would be a recurring, annual impact of indi-
viduals moving into the New Mexico post-secondary education system. For the second compo-
nent, the fiscal impact would occur in two key areas: 1) general fund cost of each student per
the higher education funding formula and 2) general fund cost of each student receiving a non-
resident tuition waiver. Due to the size of potential eligibles, the general fund cost is indetermi-
nate, but potentially large.
Note in the case of a non-resident tuition waiver, the general fund bears the burden of the differ-
ence between resident and non-resident tuition rates for every student (as is the case for all cur-
rent tuition waiver programs). This fiscal cost occurs because of the interpretation of the CHE
for similar statutory provisions offering non-resident tuition waivers contained within 21-1-3
NMSA 1978, such as Texas 135-mile, athletics and graduate assistants.
According to LFC files, the Navajo Nation non-resident tuition waiver program is currently of-
fered by the Commission on Higher Education in that “all out-of-state members of the Navajo
tribe who reside on the Navajo reservation, as certified by the Navajo Department of Higher
Education, is assessed in-state tuition rates.” Further, a New Mexico/Arizona reciprocity agree-
ment enables students from each state to enroll at designated institutions of higher education in
the other state at in-state tuition rates.
pg_0003
House Bill 584 -- Page 3
According to data from LFC files, the cost of the existing Navajo Nation tuition waiver is $1.6
million in FY06, based on 2002-2004 enrollment data and 2004-2005 tuition rates. Of the total
amount of the cost of the Navajo Nation tuition waiver program, approximately $1.1 million is
accounted for by four-year post-secondary institutions, while just under $600 thousand was util-
ized by students at community colleges. About 65 percent of the total cost of the program was
attributable to undergraduates. Students at the University of New Mexico represented approxi-
mately 52 percent of program costs.
TECHNICAL ISSUES
In its bill analysis, CHE takes the position that if this bill is enacted, CHE regulations would be
revised to extend residency status for tuition purposes for the qualifying group at all public, post-
secondary institutions in the state.
Due to land ownership status, the provisions of this bill may be applicable to the Ute Mountain
Ute tribe in addition to the state’s 22 tribes and pueblos.
OTHER SUBSTANTIVE ISSUES
The legislation would make higher education more affordable and accessible for Native Ameri-
can students as well as offer associated economic opportunities.
According to the CHE bill analysis “all other non-resident Indian students must meet the criteria
established in CHE regulations to establish residency in New Mexico. These criteria are detailed
in 5.7.18.11 of the New Mexico Administrative Code and include:
1.
Physical resident in the state for twelve consecutive months prior to enrollment;
2.
Financial independence from parents or guardians;
3.
A written declaration of intent to relinquish residency in any other state and to establish it
in New Mexico; and
4.
Fulfillment of at least two “overt act” listed in the regulation. These include proof of
payment of state income taxes, registration of a motor vehicle in the state and several
others.”
ALTERNATIVES
It should be noted this legislation extends a higher education entitlement program; thus, potential
cost would be driven by the number of qualified applicants each year. The legislature might
consider explicit language to authorize a specific amount of funding for qualified applicants as a
mechanism to cap annual costs. Then, the cap could be evaluated on the basis of the demand
and funding availability.
WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL.
The Department of Indian Affairs notes the “opportunity to increase the number of well-trained
professional tribal members who could help improve the social and economic conditions of their
communities would be lost.” Further, the Department of Indian Affairs notes the need to stem
the “brain drain” effect.
pg_0004
House Bill 584 -- Page 4
POSSIBLE QUESTIONS
1.
Under the provision of the legislation, is it the Legislature’s intent to authorize a non-
resident tuition waiver for the group identified in this bill, for which the general fund
bears the cost of the difference between resident and non-resident tuition for each eligible
student.
AW/lg