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

SPONSOR Grubesic

ORIGINAL DATE

LAST UPDATED

2/08/06

HB

SHORT TITLE Alternative Energy Cooperative Ownership

SB 635

ANALYST Earnest

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

$75.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Senate Bill 635 relates to House Bill 696.

SOURCES OF INFORMATION

LFC Files

Responses Received From

Economic Development Department (EDD)

Department of Environment (DE)

SUMMARY

Synopsis of Bill

Senate Bill 635 appropriates $75 thousand from the general fund to the Economic Development

Department to contract with a not-for-profit community development corporation in Santa Fe

and Bernalillo counties with at least fifteen years of experience with the “Mondragon coopera-

tive system” for the purpose of promoting the development and ownership of alternative energy

source by low- and moderate-income populations.

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.

Senate Bill 635 – 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

Senate Bill 635 relates to House Bill 696.

OTHER SUBSTANTIVE ISSUES

The Department of Environment notes that a similar bill (HB 696) could promote economic de-

velopment 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 bio-

mass 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, sulfur dioxide, particulates, mercury and carbon dioxide. These air pollutants ad-

versely impact public health, visibility, and the global climate.

BE/nt