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

SPONSOR Zanetti

ORIGINAL DATE

LAST UPDATED

02/20/07

03/15/07 HB 732/aHCPAC/aSFl

SHORT TITLE

Increase Homestead and Property Exemptions

SB

ANALYST Hanika Ortiz/Baca

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in

thousands)

FY07

FY08

FY09 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

unknown

various

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Attorney General’s Office (AGO)

Administrative Office of the Courts (AOC)

SUMMARY

Synopsis of SFl Amendments

Senate Floor Amendments strike Consumer and Public Affairs Committee amendments 1 and 2,

and change the homestead to $60,000 from $150,000 throughout the bill.

Synopsis of HCPAC Amendment

The House Consumer & Public Affairs Committee Amendment proposes to increase the amount

of homestead exemption proposed in the bill from thirty thousand dollars ($30,000) to forty

thousand dollars ($40,000); and, increases the amount of property exemption from two thousand

dollars ($2,000) to five thousand dollars ($5,000).

Synopsis of Original Bill

House Bill 732 amends NMSA 1978, § 42-10-9 to increase the amount of homestead exemption

from thirty thousand dollars ($30,000) to one hundred fifty thousand dollars ($150,000). It also

amends NMSA 1978, § 42-10-10 to increase the amount of property exemption in lieu of

homestead from two thousand dollars ($2,000) to ten thousand dollars ($10,000

).

House Bill 732/aHCPAC/aSFl– Page

2

FISCAL IMPLICATIONS

This bill does not affect property tax assessment and subsequent revenue collected by the state.

If an increased homestead exemption makes it more difficult for creditors to collect money

owed; it may take more judicial resources to cope with motions to enforce judgments.

There will be a minimal administrative cost for statewide update, distribution and documentation

of statutory changes. Any additional fiscal impact on the judiciary would be proportional to the

additional judicial activity, if any, resulting from the proposed change in the law. New laws,

amendments to existing laws and new hearings have the potential to increase caseloads in the

courts, thus requiring additional resources to handle the increase.

SIGNIFICANT ISSUES

Section 42-10-9 NMSA 1978 allows for a homestead exemption during attachment, execution or

foreclosure proceedings for a dwelling occupied by a person provided the dwelling is owned,

leased or being purchased by such person.

Section 42-10-10 NMSA 1978 provides for persons who do not own a dwelling to hold exempt

real or personal property in lieu of a homestead exemption.

The AGO reports that current law provides for a homestead exemption of thirty thousand dollars

($30,000); and, a property exemption in lieu of homestead of two thousand dollars ($2,000).

PERFORMANCE IMPLICATIONS

This bill may impact the courts’ performance based budgeting measures, which may result in a

need for additional resources.

ADMINISTRATIVE IMPLICATIONS

It is unknown if this measure will result in additional pressure on judicial resources.

AHO/nt