Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and

attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

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

SPONSOR Jennings

DATE TYPED 03-13-05 HB

SHORT TITLE NMMI Legislative Scholarship Fund

SB 746/aHEC

ANALYST Woods

APPROPRIATION

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

New Mexico Commission on Higher Education (CHE)

New Mexico Military Institute (NMMI)

SUMMARY

Synopsis of HEC Amendment

The House Education Committee amendment further clarifies that the fund was established to

implement the General Richard T. Knowles legislative scholarship program.

Synopsis of Original Bill

Senate Bill 746 – Relating to New Mexico Military Institute; Providing for the Transfer of Cer-

tain Budget Balances to the Legislative Scholarship Fund; Making an Appropriation – seeks to

authorize the Board of Regents of the New Mexico Military Institute, with the approval of the

Commission on Higher Education, to transfer up to $500,000 of the institute's budget balances to

the legislative scholarship fund each fiscal year.

There is no appropriation attached to this legislation.

Significant Issues

NMMI indicates that this program was established in honor of former legislator, Lieutenant Gen-

eral Richard Knowles, and permits legislators to nominate New Mexico students to attend the

Senate Bill 746/aHEC -- Page 2

institute.

The institute further notes that this legislation would authorize NMMI to transfer up to $500,000

per year from excess fund balances to the Knowles Legislator Scholarship Fund. This program

is currently under-funded and NMMI’s goal is to stabilize the current program and then expand

to full scholarships when funding permits. Not only would the legislation increase usage of

scholarships in all districts and make attendance possible for those without the financial re-

sources, but it would eventually provide legislators with the means to award full, four year

scholarships to those students meeting program criteria.

FISCAL IMPLICATIONS

NMMI observes that a full scholarship presently costs approximately $7,500 per year, further

that the corpus of the scholarship fund is currently some $2,500,000. NMMI projects that an ad-

ditional $6,000,000 is needed to support the program.

NMMI adds that increases in the Permanent Fund distributions made possible by Constitutional

Amendment (intended to improve education) make the transfers possible from increased ending

balances.

ADMINISTRATIVE IMPLICATIONS

The institute suggests that scholarship award amounts are not currently specified in statute,

therein leaving the NMMI Board of Regents the discretion to administer a scholarship program

with no limitations on amounts. Accordingly, no additional language – or additional appropria-

tion – is required other than the budget balance transfer authority that is the objective of this leg-

islation.

OTHER SUBSTANTIVE ISSUES

Since there is no appropriation attached to this legislation, it appears that the language “Making

an Appropriation” as appears in the bills title, is in need of clarification.

BFW/lg:rs