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

SPONSOR Lujan, B.

ORIGINAL DATE

LAST UPDATED

2-6-06

2-9-06 HB 568/aHBIC

SHORT TITLE REGIONAL HOUSING COUNCIL & FUND

SB

ANALYST Hadwiger

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$5,000.0 Non-Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Finance and Administration (DFA)

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

FY08

$5,000.0

Non-Recurring

Regional

Housing

Revolving Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SUMMARY

Synopsis of HBIC Amendment

The House Busineess and Industry Committee amendment to House Bill 568 changes the selec-

tion process for members of the proposed Regional Housing Council to eliminate language

whereby the governor would have selected three members and substitute language whereby one

member would be appointed by the governor, one by the President Pro Tempore of the Senate,

and one by the Speaker of the House of Representatives.

House Bill 568/aHBIC – Page 2

Synopsis of Original Bill

House Bill 568 creates a Regional Housing Revolving Fund, consisting or appropriations, gifts,

grants, donations and bequests made to the fund and repayments by regional housing authorities

of distributions from the fund. Money in the fund would be appropriated to the Regional Hous-

ing Council (below) for distribution to regional housing authorities. The money in the fund

would not revert at the end of a fiscal year. The bill appropriates $5 million to the fund for ex-

penditure in FY07 and subsequent years.

HB568 also adds a section to the Regional Housing Law creating a Regional Housing Council

(Council) comprised of ten members appointed as follows:

1.

Three appointed by the governor to two-year terms

2.

The chair of each of the seven regional housing authorities or the chair’s designee.

The members would receive per diem and mileage but no other compensation.

The Council would make distributions from the Regional Housing Revolving Fund under the

following guidelines:

1.

Distributions would be made to provide authorities with the necessary funding to initiate

a housing project, including funds to match federal, local or private money;

2.

After a housing project commences, as a recipient authority recoups money from bond or

loan proceeds or other funding, the amount received from the fund shall be repaid and

deposited in the fund;

3.

The amount distributed to an authority in a fiscal year would be based on an equitable

formula developed by the Council based on population according to the 2000 federal de-

cennial census.

FISCAL IMPLICATIONS

The appropriation of $5 million contained in this bill is a non-recurring expense to the general

fund. Unexpended or unencumbered balances remaining at the end of a fiscal year would not re-

vert to the general fund. There would be minimal additional fiscal impact for per diem and mile-

age for Council members to attend meetings and for processing grant applications for allocations

from the Regional Housing Revolving Fund. Employees of the regional authorities would staff

the Council.

Continuing Appropriations language

This bill creates a new fund and provides for continuing appropriations. The LFC has concerns

with including continuing appropriation language in the statutory provisions for newly created

funds, as earmarking reduces the ability of the legislature to establish spending priorities.

SIGNIFICANT ISSUES

DFA noted that the regional housing authorities work to help low income person obtain afford-

able housing. These regional housing authorities also work to reduce and eliminate unsanitary

and unsafe dwellings. It is through the seven regional housing authorities that properties are ac-

quired, purchased, leased, constructed, reconstructed, improved, and repaired to help provide for

the many low income citizens of New Mexico.

House Bill 568/aHBIC – Page 2

PERFORMANCE IMPLICATIONS

DFA indicated that the establishment of the new Regional Housing Council will provide better

coordination and oversight to the various regional housing authorities around the state.

ADMINISTRATIVE IMPLICATIONS

According to DFA, there should be little administrative implications to the oversight of the funds

since the money would be expended by vouchers signed by the Chair of the Regional Housing

Council and submitted to the Department of Finance and Administration for the issuance of war-

rants.

DH/yr:mt