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

SPONSOR Sanchez, M.

ORIGINAL DATE

LAST UPDATED

1/24/06

HB

SHORT TITLE Define Higher Education Tuition & Fees

SB 155

ANALYST Earp

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

(0.1)*

Recurring

Lottery Tuition Fund

(Parenthesis ( ) Indicate Expenditure Decreases) *SEE NARRATIVE

SOURCES OF INFORMATION

LFC Files

Responses Received From

Higher Education Department (HED)

SUMMARY

Synopsis of Bill

Senate Bill 155, sponsored by Senator Michael Sanchez on behalf of the interim Lottery Tuition

Scholarship Study Committee, amends Section 21-1-4 NMSA 1978 to define the terms “tuition”

and “general fee.” Further, this language applies to four-year public, post-secondary institu-

tions, and the application of this section is extended to branch community colleges, community

colleges and technical vocational institutions.

FISCAL IMPLICATIONS

This bill does not contain an appropriation; however, enactment of this legislation is likely to

have a significant impact on the expenditure of the Lottery Tuition Fund. The lack of clear statu-

tory definitions of “tuition” and “general fees” has contributed to a trend by some institutions of

higher education to reclassify an increasing portion of their combined “tuition and fee” charges

as “tuition.” The impact of this reclassification is to increase the value of Lottery Success

Scholarships for eligible recipients, thereby increasing the expenditure rate from the Lottery Tui-

tion Fund. Enactment of this legislation will constrain this practice which should help reduce the

rate of growth in future expenditures for the program, all other things held equal.

Senate Bill 155 – Page

2

SIGNIFICANT ISSUES

Establishing clearer definitions for these terms should contribute to more consistent and equita-

ble pricing practices among New Mexico public postsecondary institutions, and provide more

equitable benefits to Lottery Success Scholarship recipients.

ADMINISTRATIVE IMPLICATIONS

HED is charged with administration of existing statutes relating to tuition and fee practices at the

institutions. The greater specificity of the definitions contained in this legislation should assist

the department in this regard. No significant additional administrative impact is apparent.

OTHER SUBSTANTIVE ISSUES

The New Mexico Higher Education Department (NMHED) notes that it has statutory authority

to ensure that tuition and fees are properly assessed. Defining tuition and fees will strengthen

accountability and allow for improved external auditing. HED states that enactment of Senate

Bill 155 will assist the department and New Mexico public post-secondary institutions in the

budgeting, accounting, and reporting of tuition and fees.

While this bill specifically extends the application of Section 21-1-4 to various two-year institu-

tions, it is noted that this has been the general practice even though the statute was not specific in

this regard.

DE/yr