Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

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attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

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

SPONSOR HENRC

ORIGINAL DATE

LAST UPDATED

2-22-07

3-10-07 HB 888/HENRCS

SHORT TITLE New Mexico Environmental Health Act

SB

ANALYST Aubel

ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)

FY07

FY08

FY09 3 Year

Total Cost

Recurring

or Non-Rec

Fund

Affected

Total

See Narrative

Recurring General

Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to SB 880

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Finance and Administration (DFA)

Energy, Minerals and Natural Resources Department (EMNRD)

New Mexico Municipal League (NMML)

Attorney General’s Office (AGO)

Economic Development Department (EDD)

New Mexico Corrections Department (NMCD)

New Mexico Environment Department (NMED)

SUMMARY

Synopsis of Bill

The House Energy and Natural Resources Committee Substitute for House Bill 888 enacts the New

Mexico Environmental Health Act (Act), which requires the owner or operator of certain regulated

facilities to have a community impact assessment report prepared and submitted to the Environment

Department (NMED) for its review in making permitting and other decisions that may significantly

impact New Mexico communities. Additionally, the HENRC Substitute for HB 888 requires NMED to

compile a list of potential contractors qualified to prepare a community impact assessment report. To

qualify, the potential contractor must show familiarity with the communities, including their resources

and the issues facing the communities.

Section 3 provides definitions. Types of regulated facilities that would fall under this Act

include solid waste facilities, hazardous waste facilities, facilities requiring a Title V air permit,

and wastewater treatment plants. Impacts to be considered are those relating to public health,

safety, welfare or environment. “Community" is defined as an area that includes at least 50

House Bill 888/HENRCS – Page

2

people within one square mile and within five miles of the geographic center of the regulated

facility.

Section 4 relates to the preparation of the “community impact assessment report", which shall

include demographic data; potential present, future and cumulative impacts; other known or

proposed regulated facilities and their potential impacts; and any other known environmental

factors.

Section 5 provides the public notification requirements and provides direction for public hearings

by deferring to prior statute that governs the regulated facility.

Section 6 directs NMED to consider that report and explain in any written decision how it took

the report into account in its decision.

Section 7 authorizes the Secretary of Environment to adopt rules to ensure compliance with the

Act. It also specifies that the Secretary will provide procedures for oral and written input from

affected residents into the community impact assessment reports.

Section 8 provides that the Act cannot be construed to preempt more stringent or extensive

requirements of any other rules adopted by the department. It also provides a provision to

prevent duplicative assessment reports.

FISCAL IMPLICATIONS

According to DFA, this bill could result in some fiscal impact to the NMED as well as those

communities or entities proposing or operating regulated facilities. The primary fiscal impacts

anticipated for NMED include additional costs for staff that has expertise in multimedia impacts

to assess the reports. In most cases, the costs of preparing the community impact assessment

reports will be borne by the regulated facility, but in some instances the entity proposing a

facility may be a governmental entity.

No appropriation is made in this bill to underwrite this expansion of duties, which could be

funded from general fund, special funds, or from additional permitting fees, as required.

Permitting fees would usually need statutory authorization for increase or introduction.

SIGNIFICANT ISSUES

The HENRC Substitute for HB 880 requires NMED to consider impacts on communities beyond

compliance with environmental standards, and to expand public notice when a decision will have

“significant impact" on a community. EMNRD notes that this bill follows the decision of the

New Mexico Supreme Court in the Rhino landfill case (Colonias Development Council v. Rhino

Environmental Services, Inc., 138 N.M. 133, 117 P.3d 939 (2005)). In Rhino, the Environment

Department was forced to reevaluate a decision because it failed to consider evidence on

community impacts and cumulative impacts.

The Act excludes several permitted facilities, thereby significantly reducing the number of

permitting situations covered by the Act. Drinking water system, health clinics, restaurants, on-

site liquid waste systems and swimming pools are excluded based on the concept that the facility

does not have the potential individually to have a “significant impact on the community."

House Bill 888/HENRCS – Page

3

The “regulated facility" covered under HB 888/HENRCS is one that receives a permit from the

department or is authorized to be constructed or operated by a decision of NMED and is defined

by the following list: a facility subject to the Solid Waste Act, a facility subject to the Hazardous

Waste Act, a facility subject to the Title V air quality permitting, a wastewater treatment plant or

other facility permitted according to the federal Water Pollution Control Act or Water Quality

Act that discharges at least 20 thousand gallons per day.

Such existing or proposed facilities would be required to pay for a “community impact

assessment report" as part of the issuance, renewal, amendment or denial of any permit, variance

or waiver of the facility. NMED would incorporate this report in its decision-making regarding

the facility and include an explanation in any written decision.

NMED states its support for cumulative impact reports for these circumstances.

ADMINISTRATIVE IMPLICATIONS

Additional permitting staff hours will most likely be required to accomplish the tasks in this Act.

The bill does not specify the administrative impact for new permits that are currently in the

pipeline. It would appear that the potential for significant delays exists while the rules are

promulgated by the Secretary, and the list of qualified contractors developed, the hearing process

initiated and the community impact assessment report prepared.

OTHER SUBSTANTIVE ISSUES

The AGO points out that NMSA Section 39-3-1.1 already confers a right to appeal certain

administrative decisions of NMED: administrative actions taken by the Secretary pursuant to the

provisions of the Recycling and Illegal Dumping Act (NMSA Section 74-13-15); actions

regarding food service permits (NMSA Section 25-1-11); licensing actions relating to radiation

control (NMSA Section 74-3-9); etc.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

NMED will use its current requirements, including the expanded program of Environmental

Justice, for public involvement before making decisions.

POSSIBLE QUESTIONS

1.

How many covered facilities are in the pipeline for permitting or renewal, and how will

the new rules impact these covered facilities in the pipeline.

2.

Will significant delays cause undue hardship on the facilities and or communities waiting

for NMED decisions.

3.

Will there be a shortage of qualified contractors to prepare the impact assessment report

in certain areas of the state.

MA/mt