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

SPONSOR SFC

DATE TYPED 3/3/05

HB

SHORT TITLE Increase Game And Fish License Fees

SB

16/77/336/SFCS/aSFL#1

ANALYST Aguilar

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

Indeterminate

Indeterminate Recurring Game Protec-

tion Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

$1,500.0

$4,500.0 Recurring

Game Protection

Fund

(Parenthesis ( ) Indicate Revenue Decreases)

Conflicts with HB-47

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Game and Fish (DGF)

SUMMARY

Synopsis of Senate Floor Amendment #1

Senate Floor Amendment #1 to Senate Finance Committee Substitute for Senate Bill 16, 77 and

336 reduces the fees for a temporary small game license from $35 dollars to $33 dollars. The

Senate Finance Committee substitute had increased the fee from $35 dollars to $44 dollars.

Senate Bill 16/77/336/SFCS/aSFl#1 -- Page 2

Synopsis of Original Bill

The Senate Finance Committee substitute for Senate Bills 16, 77 and 336 raises license fees for

resident, nonresident and temporary hunting and fishing licenses, removes obsolete license de-

scriptions, provides for a junior hunting and fishing license and increases the eligibility age, pro-

vides for a junior-senior elk license, clarifies a license type and provides for increased distribu-

tion of vendor fees.

Significant Issues

The Department of Game and Fish generates the majority of its revenue through the sale of hunt-

ing and fishing licenses, with fees fixed by statute. Inflation and appropriations for nonrecurring

projects have caused overall expenditures to surpass revenues, reducing cash balances in the

Game Protection Fund. This has produced a situation where increasing revenue has become a

priority for the department. Increasing license fees is one way the department has identified to

generate additional revenue. In recent years, the game protection fund has provided opportuni-

ties for the department to complete several projects, such as the construction of its headquarters

building, construction of fish hatcheries and the purchase of Eagle Nest Lake.

Current estimates show that the fund is declining to a critical level. Revenues to the department

are off from October through March requiring a minimum cash balance of $6 million. Depart-

ment estimates indicate the fund may fall below this threshold by the end of FY07.

The department notes the last increase in license fees was effective in 1996, with some fees be-

ing reduced in 1997. This fee increase would take effect on April 1, 2006.

Current statute provides for 10 cents of each temporary license be paid to the vendor. SB

16/77/336/SFCS provides for a 50 cent distribution to vendors.

PERFORMANCE IMPLICATIONS

The department reports in order to continue providing services at the current level, the agency

must have sufficient income to keep up with inflationary effects on operating costs such as; gaso-

line, employee salaries and benefits, changes in per diem rates, utilities, etc. If the Department

does not obtain a change in fees or some other form of revenue enhancement, it will not have the

resources to operate at the level used to establish target levels for performance measures.

One of the agency’s performance measures is based on the percentage of special drawing li-

censes issued to New Mexico resident applicants. Increasing fees for nonresident applicants will

potentially decrease the overall number of nonresident applicants, possibly increasing the num-

ber of licenses drawn by residents.

FISCAL IMPLICATIONS

At current sales levels, the changes proposed in this bill will generate an additional $4.5 million

in annual license sales revenue for the Department of Game and Fish. This will allow the agency

to continue operating at current levels. Without the proposed increase, current cash balances will

only sustain the agency’s operations through fiscal year 2007.

Senate Bill 16/77/336/SFCS/aSFl#1 -- Page 3

ADMINISTRATIVE IMPLICATIONS

If passed, the Department would implement this amendment on April 1, 2006. This will allow

for printed materials and computer systems to be updated to reflect the amended fees.

PA/lg:yr