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

SPONSOR McSorley

DATE TYPED 02/12/05 HB

SHORT TITLE UNM Law School Library

SB 574

ANALYST Woods

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

$250.0

Recurring General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to the appropriation for the University of New Mexico in the General Appropriations

Act.

SOURCES OF INFORMATION

LFC Files

Responses Received From

Commission on Higher Education (CHE)

SUMMARY

Synopsis of Bill

Senate Bill 574 – Making an Appropriation to Increase Funding for the University School of

Law Library – appropriates $250,000 from the general fund to the Board of Regents of the Uni-

versity of New Mexico for expenditure in FY06 to increase funding for the library at the Univer-

sity of New Mexico School of Law. Any unexpended or unencumbered balance remaining at the

end of FY06 shall revert to the general fund.

Significant Issues

CHE notes that the University of New Mexico requested $500,000 in non-recurring funds and

$250,000 in recurring funds for FY06. In the course of that request, UNM indicated that when

the American Bar Association and the Association of American Law Schools (AALS) conducted

Senate Bill 574 -- Page 2

an accreditation visit in 2001, AALS stated that they would not agree to continue the law school

as a member if acquisition funds were not increased. The UNM Law School and Law Library are

resources for faculty and students and all lawyers and pro se litigants in the state and, without

some assistance the school will not be able to support the related needs.

CHE further notes that this proposal was ranked fifth – out of six – of the new or expansion re-

search and public service items submitted to CHE by the University of New Mexico; however

the project was not recommended for inclusion by the CHE at this time.

FISCAL IMPLICATIONS

The appropriation of $250,000 contained in this bill is a recurring expense to the general fund.

Any unexpended or unencumbered balance remaining at the end of FY06 shall revert to the gen-

eral fund.

ADMINISTRATIVE IMPLICATIONS

The University of New Mexico will retain oversight of this program.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Relates to the appropriation for the University of New Mexico in the General Appropriations

Act.

OTHER SUBSTANTIVE ISSUES

CHE indicates that higher education institutions receive indirect cost revenues from federal con-

tracts and grants. This money is unrestricted in the sense that the governing board of the institu-

tion has the flexibility to choose which projects are supported with these funds. A great deal of

this money is used as seed money to develop new research and public services projects at institu-

tions. A portion of the indirect cost revenue, or earned overhead, is used to support items such as

the salaries of the accountants responsible for monitoring the contracts and grants, or for paying

utilities and other expenses required to maintain the space where the contract and grant activities

are housed. The higher education funding formula allows institutions to retain 100 percent of

this indirect cost revenue and CHE proposes that one of the purposes of retaining these funds is

to provide seed money and matching funds for projects such as the one proposed in this bill.

In the event the appropriation is realized, CHE suggests that the University of New Mexico shall

submit a plan for program evaluation, including specific program goals and criteria for assessing

program effectiveness to the Legislative Finance Committee and CHE by October 1, 2005. CHE

additionally suggests that the institution shall also submit a program evaluation to the Legislative

Finance Committee and the Commission on Higher Education by June 30, 2008 detailing the

benefits to the State of New Mexico from having this program implemented for a three-year pe-

riod.

BFW/sb