SENATE BILL 625
47th legislature - STATE OF NEW MEXICO - second session, 2006
INTRODUCED BY
Leonard Tsosie
AN ACT
RELATING TO HIGHER EDUCATION; LIMITING LOTTERY OPERATING EXPENSES; EXTENDING COLLEGE AFFORDABILITY SCHOLARSHIP ELIGIBILITY TO NEW MEXICO TRIBAL COLLEGES; MAKING AN APPROPRIATION; AMENDING AND ENACTING SECTIONS OF THE NMSA 1978.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. Section 6-24-1 NMSA 1978 (being Laws 1995, Chapter 155, Section 1) is amended to read:
"6-24-1. SHORT TITLE.--[Sections 1 through 34 of this
act] Chapter 6, Article 24 NMSA 1978 may be cited as the "New Mexico Lottery Act"."
Section 2. Section 6-24-24 NMSA 1978 (being Laws 1995, Chapter 155, Section 24, as amended) is amended to read:
"6-24-24. DISPOSITION OF REVENUE--LIMITATION ON OPERATING EXPENSES.--
A. As nearly as practical, an amount equal to at least fifty percent of the gross annual revenues from the sale of lottery tickets shall be returned to the public in the form of lottery prizes. The annual operating expenses as specified in Subsection C of this section shall not exceed twenty-two percent of the gross annual revenues from the sale of lottery tickets.
B. The authority shall transmit all net revenues to the state treasurer, who shall deposit eighty-four percent of them in the lottery tuition fund and sixteen percent of them in the college affordability endowment fund. Estimated net revenues shall be transmitted monthly to the state treasurer for deposit in the [fund] funds; provided that the total amount of annual net revenues for the fiscal year shall be transmitted no later than August 1 each year.
C. In determining net revenues, operating expenses of the lottery include all costs incurred in the operation and administration of the lottery and all costs resulting from any contracts entered into for the purchase or lease of goods or services required by the lottery, including the costs of supplies, materials, tickets, independent audit services, independent studies, data transmission, advertising, promotion, incentives, public relations, communications, commissions paid to lottery retailers, printing, distribution of tickets, purchases of annuities or investments to be used to pay future installments of winning lottery tickets, debt service and payment of any revenue bonds issued, contingency reserves, transfers to the reserve fund and any other necessary costs incurred in carrying out the provisions of the New Mexico Lottery Act.
D. An amount up to two percent of the gross annual revenues shall be set aside as a reserve fund to cover bonuses and incentive plans for lottery retailers, special promotions for retailers, purchasing special promotional giveaways, sponsoring special promotional events, compulsive gambling rehabilitation and such other purposes as the board deems necessary to maintain the integrity and meet the revenue goals of the lottery. The board shall report annually to the governor and each regular session of the legislature on the use of the money in the reserve fund. Any balance in excess of fifty thousand dollars ($50,000) at the end of any fiscal year shall be transferred to the lottery tuition fund."
Section 3. Section 6-24-27 NMSA 1978 (being Laws 1995, Chapter 155, Section 27, as amended) is amended to read:
"6-24-27. REVENUE AND BUDGET REPORTS--RECORDS--INDEPENDENT AUDITS.--
A. The board shall:
(1) submit quarterly and annual reports to the governor and the legislative finance committee disclosing the total lottery revenue, prizes, commissions, ticket costs, operating expenses and net revenues of the authority during the reporting period and, in the annual report, describe the organizational structure of the authority and summarize the functions performed by each organizational division within the authority;
(2) maintain weekly or more frequent records of lottery transactions, including the distribution of lottery tickets to retailers, revenue received, claims for prizes, prizes paid, prizes forfeited and other financial transactions of the authority; and
(3) use the state government fiscal year.
B. The board shall provide, for informational purposes, to the department of finance and administration and the legislative finance committee, by December 1 of each year, a copy of the annual proposed operating budget for the authority for the succeeding fiscal year. This budget proposal shall also be accompanied by an estimate of the net revenues to be deposited in the [public school capital outlay fund and the] lottery tuition fund and the college affordability endowment fund for the current and succeeding fiscal years.
C. The board shall contract with an independent certified public accountant or firm for an annual financial audit of the authority. The certified public accountant or firm shall have no financial interest in any lottery contractor. The certified public accountant or firm shall present an audit report no later than March 1 for the prior fiscal year. The certified public accountant or firm shall evaluate the internal auditing controls in effect during the audit period. The cost of this financial audit shall be an operating expense of the authority. The legislative finance committee may, at any time, order an audit of any phase of the operations of the authority, at the expense of the authority, and shall receive a copy of the annual independent financial audit. A copy of any audit performed by the certified public accountant or ordered by the legislative finance committee shall be transmitted to the governor, the speaker of the house of representatives, the president pro tempore of the senate and the legislative finance committee."
Section 4. Section 21-21L-1 NMSA 1978 (being Laws 2005, Chapter 192, Section 1) is amended to read:
"21-21L-1. SHORT TITLE.--[This act] Chapter 21, Article 21L NMSA 1978 may be cited as the "College Affordability Act".
Section 5. Section 21-21L-2 NMSA 1978 (being Laws 2005, Chapter 192, Section 2) is amended to read:
"21-21L-2. PURPOSE.--The purpose of the College Affordability Act is to encourage New Mexico students with financial need to attend and complete educational programs at public post-secondary educational institutions and tribal colleges in New Mexico."
Section 6. Section 21-21L-3 NMSA 1978 (being Laws 2005, Chapter 192, Section 3) is amended to read:
"21-21L-3. DEFINITIONS.--As used in the College Affordability Act:
A. ["commission" means the commission on] "department" means the higher education department;
B. "returning adult" means a student enrolling in a public post-secondary educational institution at any time later than the first semester following high school graduation or the award of a general educational development certificate; [and]
C. "student" means a resident of New Mexico who is enrolled or will be enrolled, at the time the scholarship is awarded, in a public post-secondary educational institution or tribal college in New Mexico; and
D. "tribal college" means a tribally, federally or congressionally chartered post-secondary educational institution located in New Mexico that is accredited by the north central association of colleges and schools and includes the following institutions:
(1) southwestern Indian polytechnic institute;
(2) Crownpoint institute of technology;
(3) institute of American Indian arts; and
(4) the New Mexico campus of Dine college."
Section 7. Section 21-21L-4 NMSA 1978 (being Laws 2005, Chapter 192, Section 4) is amended to read:
"21-21L-4. CONDITIONS FOR ELIGIBILITY.--A college affordability scholarship may be awarded to any person who:
A. is a resident of New Mexico for the purpose of tuition payment;
B. has not earned a baccalaureate degree and is enrolled or will be enrolled at least half time in a degree program in a public post-secondary educational institution or tribal college in New Mexico at the time the scholarship is awarded;
C. has demonstrated financial need consistent with the criteria promulgated by the [commission] higher education department; and
D. has complied with other rules promulgated by the [commission] higher education department to carry out the provisions of the College Affordability Act."
Section 8. Section 21-21L-5 NMSA 1978 (being Laws 2005, Chapter 192, Section 5) is amended to read:
"21-21L-5. SCHOLARSHIP AUTHORIZED--ADMINISTRATION--PREFERENCE IN SCHOLARSHIP AWARDS.--
A. The [commission] department shall administer the College Affordability Act and shall promulgate rules to carry out the provisions of that act.
B. Scholarships shall be awarded to qualified applicants. Qualifications shall be determined by rule of the [commission] department.
C. The [commission] department shall allocate money to public post-secondary educational institutions and tribal colleges based on a student need formula calculated according to income reported on the free application for federal student aid and on the percentage of the institution's or college's students classified as returning adults who are otherwise ineligible for state financial aid.
D. Public post-secondary educational institutions and tribal colleges shall make awards to qualifying students based on financial need in an amount not to exceed one thousand dollars ($1,000) per semester as determined by rule of the [commission] department.
E. Money for an awarded scholarship shall be placed in an account at the public post-secondary educational institution or tribal college in the name of the student, and the money may be drawn upon to pay educational expenses charged by the institution, including tuition, fees, books and course supplies."
Section 9. Section 21-21L-6 NMSA 1978 (being Laws 2005, Chapter 192, Section 6) is amended to read:
"21-21L-6. DURATION OF SCHOLARSHIP.--Each scholarship is for a period of one semester. A scholarship may be renewed, provided the recipient continues to meet the conditions of eligibility, until the award recipient has received eight consecutive semester scholarship awards or until the student graduates from an eligible four-year public post-secondary educational institution or from a tribal college, whichever occurs first."
Section 10. Section 21-21L-7 NMSA 1978 (being Laws 2005, Chapter 192, Section 7) is amended to read:
"21-21L-7. TERMINATION OF SCHOLARSHIP.--A scholarship is terminated upon occurrence of one or more of the following:
A. withdrawal of the award recipient from the public post-secondary educational institution or tribal college or failure to remain as at least a half-time student;
B. failure of the award recipient to achieve satisfactory academic progress; or
C. substantial noncompliance by the award recipient with the College Affordability Act or the rules promulgated pursuant to that act."
Section 11. A new section of the College Affordability Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTION.--No later than August 1 of each year, an amount equal to five percent of the revenues received during the previous fiscal year by the state as the state's share of Indian gaming revenue shall be transferred from the general fund to the college affordability endowment fund. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund."
Section 12. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2006.