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

SPONSOR A. Lujan

ORIGINAL DATE

LAST UPDATED

1/21/2007

HB 79

SHORT TITLE NMSU AEROSPACE ENGINEERING PROGRAM SB

ANALYST McOlash

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

$1,000.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates Senate Bill 8.

SOURCES OF INFORMATION

LFC Files

Responses Received From

New Mexico Higher Education Department (HED)

New Mexico State University (NMSU)

SUMMARY

Synopsis of Bill

House Bill 79 appropriates $1,000,000 from the General Fund to the Board of Regents of New

Mexico State University (NMSU) for expenditure in FY 2007 through FY 2010 to hire faculty

and implement undergraduate- and graduate-level degree programs in Aerospace Engineering

(AE).

FISCAL IMPLICATIONS

This bill would appropriate $1,000,000 from the General Fund to the Board of Regents of

NMSU to hire faculty and to develop Aerospace Engineering programs at the BS, MS, and PhD

level.

House Bill 79 – Page

2

The NMSU analysis indicates:

The requested recurring funds of $1,000,000 per year [emphasis added] will be used

during the 5-6 year period of program development. After 5-6 years the program will

have attained its capacity, and student credit hour production will generate program

sustaining revenue (approx. $700,000 per year) from the I&G Higher Education Funding

Formula

.

The appropriation of $1,000,000, for expenditure in a three-year period, contained in this bill is a

recurring expense to the General Fund. Any unexpended or unencumbered balance remaining at

the end of FY 2010 shall revert to the General Fund.

SIGNIFICANT ISSUES

This proposal was submitted to the New NMHED by New Mexico State University but was not

included in the Department’s funding recommendation for FY08.

Significant aspects of NMSU-AE program will be implemented at no additional expense:

existing ME courses for AE students in the freshman and sophomore years will be used, along

with ME laboratories and infrastructure, for both teaching and research.

In Fall 2006 NMSU and NMT collaborated, via distance education, in teaching the first

undergraduate aerospace engineering course. Planned: each year courses originating at NMSU

and at NMT will be available to students at both universities.

NMSU Analysis

Aerospace engineering is a 2008 NMSU legislative funding priority. The requested

recurring funds of $1,000,000 per year will be used during the 5-6 year period of program

development. After 5-6 years the program will have attained its capacity, and student

credit hour production will generate program sustaining revenue (approx. $700,000 per

year) from the I&G Higher Education Funding Formula.

Obtaining accreditation of the undergraduate program is essential. This requires at least

four faculty. Offering graduate degree programs is also essential; without graduate

programs potential faculty of high quality will not be interested. The need to hire six new

aerospace engineering faculty to ensure both undergraduate accreditation and viability of

graduate programs has dictated the budgeting for this project

.

PERFORMANCE IMPLICATIONS

The New Mexico Higher Education Department recommends that NMSU should submit a plan

for program evaluation, including specific program goals and criteria for assessing program

effectiveness to the Legislative Finance Committee and HED by August 1, 2007. The institution

shall also submit a program evaluation to the Legislative Finance Committee and HED by June

30, 2010 detailing the benefits to the State of New Mexico from having this program

implemented for a three-year period.

.

House Bill 79 – Page

3

ADMINISTRATIVE IMPLICATIONS

The Aerospace Engineering program will be developed by and initially administered by NMSU

Department of Mechanical Engineering. This department will become the “Department of

Mechanical and Aerospace Engineering" (name change approved by NMSU).

DUPLICATION

House Bill 79 duplicates the wording, but not the line structure, of SB 8.

OTHER SUBSTANTIVE ISSUES

This analysis and the analyses by NMSU and HED classify the appropriation as recurring. The

HED narrative notes that it

“

is a non-recurring appropriation that would support salaries . . ."

while NMSU indicates the program will require an annual $1.0 million appropriation.

POSSIBLE QUESTIONS

1.

Is this a one-time appropriation or does NMSU intend to request annual, and therefore

recurring, appropriations.

BM/nt