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

SPONSOR Campos

DATE TYPED 2/20/05

HB 711

SHORT TITLE Strictness of Water Quality Standards

SB

ANALYST Aguilar

APPROPRIATION

(in $000s)

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

NFI

indeterminate Recurring General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates SB583

SOURCES OF INFORMATION

LFC Files

Responses Received From

Office of the State Engineer (OSE)

Energy, Minerals, and Natural Resources Department (EMNRD)

Department of Environment (NMED)

SUMMARY

Synopsis of Bill

House Bill 711 would prohibit the Water Quality Control Commission (WQCC) from adopting

or enforcing surface water quality standards more stringent than those required by the federal act

and regulations pertaining to surface water quality standards.

Significant Issues

According to the Energy, Minerals and Natural Resources Department (EMNRD), WQCC stan-

dards now apply to "waters of the state" or bodies of water that do not flow across state bounda-

ries. Under New Mexico law, "waters of the state" include waters in playa lakes and their tribu-

taries that have no surface connection to any navigable stream system. By contrast, the federal

Clean Water Act is restricted to "waters of the United States." The phrase "waters of the United

States" has been the subject of many decisions by federal appellate courts, and its meaning is far

House Bill 711 -- Page 2

from clear. A recent article in United States Law Week analyzing this issue [72 U.S.L.W.

No.43, at 2683] described this issue as a "quagmire" due to conflicting decisions of circuit courts

and failure of the U.S. Supreme Court to resolve these issues. It is presently unclear whether wa-

ters in playa lakes and their tributaries or other closed basins are, or are not, "waters of the

United States." Thus the bill might divest the WQCC of regulatory power over the quality of

intrastate waters. EMNRD noted that the bill would limit WQCC jurisdiction to "waters of the

United States" and preclude it from applying standards and regulations to any surface waters of

the State that may be held not to meet that definition.

NMED was concerned that HB711 is a direct attempt to undo a recent unanimous decision by the

WQCC to delink the state’s protection of its surface waters from decisions made by the federal

government. The commission’s decision was made based on testimony provided by multiple

parties in a two week hearing in which all parties were able to present scientific evidence, and

cross examine all parties. The WQCC includes diverse representatives from government agen-

cies, industry, agriculture, municipalities, tribal and environmental interests.

NMED noted that HB711 contradicts the position taken by the Governor in a communication to

the New Mexico congressional delegation in which he urged the restoration of protections af-

forded by the federal Clean Water Act and stated that federal legal rulings have “put many of

New Mexico’s cherished rivers, lakes and streams, from the eastern playas to the Mimbres and

Tularosa river basins in the south and west, in jeopardy”.

By means of background, NMED noted that, in a 2001 Supreme Court decision, Solid Waste

Agency of Northern Cook County v. U.S. Army Corps of Engineers, the Court questioned federal

jurisdiction of some intrastate waters. In the wake of this decision, the federal courts and federal

agencies (EPA and the Corps) continue to issue conflicting opinions regarding the scope of

Clean Water Act jurisdiction over intrastate waters. A significant number of New Mexico’s wa-

ters, such as ephemeral waters, closed basins, and playa lakes, are affected by this uncertainty,

and may have lost or may lose their Clean Water Act protection. For example, waters in the

Mimbres, Tularosa, Sacramento, and San Augustine Basins would no longer be protected, allow-

ing unlimited degradation that could result in adverse impacts to human health, economic vitality

and the existing diverse population of fish and other native wildlife.

PERFORMANCE IMPLICATIONS

NMED indicated that HB711 would significantly constrain the department’s ability to pursue it

mission of protecting public health and ensuring the quality of the state’s environment.

EMNRD noted that the regulatory framework for surface water protection in New Mexico is

based on WQCC standards. To the extent these standards are undermined, other agencies with

responsibility for protection of waters, including EMNRD, cannot implement or enforce effec-

tive water protection rules.

FISCAL IMPLICATIONS

HB711 would reduce NMED administrative costs by narrowing the agency’s regulatory man-

date. If reduced regulation of surface water results in degradation of water quality, these savings

might be offset by additional drinking water treatment costs for New Mexico local governments.

House Bill 711 -- Page 3

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Duplicates SB583.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL.

The WQCC will retain authority to adopt water quality standards more stringent than applicable

federal standards and to regulate the quality intrastate waters that may not be regulated under

federal law at this time.

PA/yr