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).

Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and

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 Salazar

ORIGINAL DATE

LAST UPDATED

3/15/07

HM 110

SHORT TITLE LANL Tax Status Economic Impact Study

SB

ANALYST Guambaña

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicate of Senate Memorial 82

Relates to Senate Memorial 49

SOURCES OF INFORMATION

LFC Files

SUMMARY

Synopsis of Bill

House Memorial 110 requests a comprehensive assessment of the fiscal impacts on cities and

counties in the Los Alamos National Laboratory’s (LANL) employment base area resulting from

the changed tax status of LANL’s new contract and requesting that a comprehensive economic

development plan be developed for the LANL’s employment base area.

SIGNIFICANT ISSUES

According to House Memorial 110:

•

LANL was established over sixty-three years ago;

•

LANL’s budget of more $2,000,000,000 creates a significant, regional economic engine;

•

LANL's total work force of approximately 15,000 makes it the largest employer

in northern New Mexico;

•

The United States, through its agencies, has "recompeted" the contract for operation of

LANL, and the new contract took effect on June 1, 2006;

•

The new contract caused a change in the taxable status of LANL's operations;

•

The change in tax status has had an enormous fiscal impact on LANL, including a

House Memorial 110 – Page

2

budget deficit, reductions in work force and other changes that adversely impact the

people and economy of north central New Mexico;

•

The new taxable status requires that LANL pay gross receipts taxes in an amount equal

to approximately $40,000,000 to Los Alamos county and $50,000,000 to the State of

New Mexico;

•

The State of New Mexico has not assessed the fiscal impact on cities and counties within

LANL's employment base area, and

•

The regional economy in LANL's employment base area continues to experience extreme

dependency on laboratory funding, remains vulnerable to past, present and future

laboratory job cuts and lacks significant investment needed to build a new, sustainable

economy.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

House Memorial 110 duplicates Senate Memorial 82.

AG/mt