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

SPONSOR Miera

ORIGINAL DATE

LAST UPDATED

2/08/06

HB 696

SHORT TITLE Alternative Energy Community Ownership Model SB

ANALYST Earnest

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$75.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

House Bill 696 relates to Senate Bill 635.

SOURCES OF INFORMATION

LFC Files

Responses Received From

Economic Development Department (EDD)

Department of Environment (DE)

SUMMARY

Synopsis of Bill

House Bill 696 appropriates $75 thousand from the general fund to the Economic Development

Department to contract with a non-profit corporation with at least fifteen years of experience

with the “Mondragon cooperative system” and emphasizing alternative energy development.

FISCAL IMPLICATIONS

The appropriation of $75 thousand contained in this bill is a recurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of fiscal year shall revert

to the general fund.

House Bill 696 – Page 2

SIGNIFICANT ISSUES

EDD indicates it doesn’t have experience in administering a contract of this type. The number of

Community Development Corporations with extensive experience in the “Mondragon Coopera-

tive Systems” model might be very limited.

ADMINISTRATIVE IMPLICATIONS

EDD staff will be required to administer the contractual agreement with the nonprofit corpora-

tion. The staff member administering the contract will need basic working knowledge of the

corporation’s function, as well as a basic working knowledge of the “Mondragon Cooperative

Systems” model, to ensure that legislative intent is met.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

House Bill 696 relates to Senate Bill 635, which specifies Santa Fe and Bernalillo counties.

OTHER SUBSTANTIVE ISSUES

The Department of Environment notes that HB 696 could promote economic development and

alternative energy sources in the State. The bill doesn’t define what alternative energy sources

are, although it is likely to mean renewable sources, such as wind, solar and biomass power

sources. The promotion of renewable energy sources could delay or obviate the need for the

construction of new dirtier sources of power, such as conventional coal-fired power plants. The

State’s coal-fired power plants are major sources of air pollution, such as oxides of nitrogen, sul-

fur dioxide, particulates, mercury and carbon dioxide. These air pollutants adversely impact

public health, visibility, and the global climate.

BE/nt