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

SPONSOR Papen

ORIGINAL DATE

LAST UPDATED

2-10-06

HB

SHORT TITLE Las Cruces Land Sale

SJR 8

ANALYST Hadwiger

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY06

FY07

None

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Finance and Administration (DFA)

General Services Department (GSD)

SUMMARY

Synopsis of Bill

Senate Joint Resolution 8 authorizes the Property Control Division of the General Services De-

partment (GSD) to sell or exchange state-owned land to/with the City of Las Cruces, to be sold

or exchanged for amount no less than the appraised value validated by the Taxation and Revenue

Department. If exchanged, the owner of the parcel with the lower appraisal would compensate

the other party for the difference.

FISCAL IMPLICATIONS

The proposed transaction would have no net fiscal impact. To the extent that a land sale or ex-

changes facilitates construction of a central state-owned building, consolidating multiple state

agencies in one state owned building will lower lease cost for state agencies currently residing in

rental facilities, as well as lower operating, utilities and maintenance costs. The savings would

likely not be realized in FY07.

Senate Joint Resolution 8 – Page 2

SIGNIFICANT ISSUES

Section 13-6-3 NMSA 1978 requires that sale or trade of state property valued in excess of $100

thousand requires legislative approval.

DFA noted that the current parcel owned by the state in Las Cruces is about 1.76 acres. The city

has expressed interest in the property for developing transportation infrastructure in down town

Las Cruces. If the state can acquire land well suited for a multi-state agency building (including

the Workers' Compensation Administration field office) then both parties will benefit. It is not

clear why the existing state owned parcel is not suited for the proposed state office building.

GSD indicated that the property to be sold or traded was acquired in 2002 for an office to house

a Worker’s Compensation Administration (WCA) field office. WCA will be co-located with

other state agencies in a state office building currently in design.

PERFORMANCE IMPLICATIONS

GSD noted that the policy of co-locating state agencies reduces lease costs while minimizing in-

frastructure costs.

ADMINISTRATIVE IMPLICATIONS

Neither GSD nor DFA anticipated administrative concerns from this bill.

OTHER SUBSTANTIVE ISSUES

DFA explained that Laws of 2002, Chapter 110, Section 49 appropriated $2,800,000 from the

workers' compensation administration fund to the capital program fund at the Property Control

Division of the General Services Department to acquire land, design, plan construct or remodel,

equip and furnish office buildings in Las Cruces and Farmington. Of that appropriation $200.0

has been has been earmarked to design a facility in Las Cruces. It is not known whether or not

the total cost of acquisition of land and design and construction of a new building in Las Cruces

will limit the state's ability to use whatever portion of the original $2,800.0 appropriation re-

mains for building or acquiring office buildings in Farmington.

DH/yr