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

SPONSOR Garcia

DATE TYPED 2/16/05

HB

SHORT TITLE Create Division of International Trade

SB 35

ANALYST Rosen

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

0.0

180.0 Recurring General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to Appropriation in the Executive Budget Recommendation

SOURCES OF INFORMATION

LFC Files

Responses Received From

Economic Development Department (EDD)

Department of Environment (DOE)

SUMMARY

Synopsis of Bill

Senate Bill 35 creates a Division of International Trade within EDD, provides for a division di-

rector and one additional FTE to coordinate the state’s relations with other countries, promoting

New Mexico and its assets and fostering and supporting the efforts of New Mexico individuals,

businesses and organizations involved in the promotion of New Mexico in other countries. Sen-

ate Bill 35 also amends the name and duties of EDD’s existing Trade and Mexican Affairs Division

to be called the Mexican Affairs Division and transfers some of its current duties to the new Interna-

tional Trade division.

Senate Bill 35 -- Page 2

Significant Issues

According to the State Personnel Office (SPO) FY04 annual report, EDD has the highest ratio of

managers to staff of all state government agencies. SPO reports EDD has 32 classified managers

and 57 classified staff, or 56% of all classified staff at EDD are managers. SPO indicates the av-

erage ratio of classified managers to staff for all state agencies is 10.1%.

The bill requires the new Division to create central registry of New Mexico products and busi-

nesses as well as a database of potential domestic and international investors and consumers in

addition to promotion of the economic development of the State through export promotion and

investment promotion.

PERFORMANCE IMPLICATIONS

EDD indicates results, in terms of increased investment in the State, increased international busi-

ness, and increased jobs and revenues resulting from international business and investment, will

be set as goals for this new division.

FISCAL IMPLICATIONS

EDD’s FY06 budget request submitted on September 1, 2004 to DFA and LFC included only

$90.0 and 1 FTE for this new division. The Governor’s executive budget recommendation for

EDD included $180.0 and 2 FTE. According to EDD response to a LFC request for analysis of

the bill on January 21, 2005, the recurring fiscal impact is now $155.0.

ADMINISTRATIVE IMPLICATIONS

This bill amends the title and duties of an existing division, creates a new division and authorizes

2 additional FTE for the new division.

ALTERNATIVES

Retain the current administrative configuration at the Economic Development Department.

JR/njw