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

SPONSOR Leavell

ORIGINAL DATE

LAST UPDATED

2/3/2007

HB

SHORT TITLE Southeast NM Center for Energy Studies

SB 348

ANALYST McOlash

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

$250.0

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Energy, Minerals, and Natural Resources Department (EMNRD)

Higher Education Department (HED)

SUMMARY

Synopsis of Bill

Senate bill 348 appropriates $250,000 from the General Fund to the Regents of New Mexico In-

stitute of Mining and Technology (NM Tech) for expenditure in FY 2008 to create a Southeast

New Mexico Center for Energy Studies, as part of the Geophysical Research Center, in Lea

County to review and analyze energy policy.

FISCAL IMPLICATIONS

The appropriation of $250,000 contained in this bill is a recurring expense to the General Fund.

Any unexpended or unencumbered balance remaining at the end of FY 2008 shall revert to the

General Fund.

The NM Center for Energy Studies (NMCES), once established, will clearly require additional

appropriations for operations.

Senate Bill 348 – Page

2

SIGNIFICANT ISSUES

The Geophysical Research Center is a state-funded research organization, part of New Mexico

Tech's Research and Economic Development Division

. Hydrology and geophysics faculty mem-

bers in the Department of Earth and Environmental Science are each partly funded by the GRC,

allowing them to devote large portions of their time to research. The GRC is also a partner in the

operation of the New Mexico Tech IRIS PASSCAL Instrument Center

, a principal facility of the

Incorporated Research Institutions for Seismology

.

The Higher Education Department notes the NMCES is seeking to establish a presence in the

area of energy-related work, by developing policy relative to different forms of energy. While

technology in renewable energy has progressed, policy in this area has not. The proposed New

Mexico Center for Energy Studies will address this issue by dovetailing policy and regulations

with the technology of renewable energy. Appropriation of funds will be used to hire two full-

time scientists with a background in energy policy, to be located in Hobbs, New Mexico.

This request was not submitted by the NM Tech to the Higher Education Department for review

and was not included in the Department’s funding recommendation for FY08.

TECHNICAL ISSUES

This bill attempts to create a Center for Energy Studies and to make an appropriation for the

newly created agency. It might be more appropriate to introduce companion bills to accomplish

these same ends.

OTHER SUBSTANTIVE ISSUES

It is unclear from the language in SB 348 on whether or not the review and analysis of energy

policy by the Center will duplicate or conflict with the statutory requirements of the Energy Con-

servation and Management Division to plan, administer, review, provide technical assistance,

maintain records and monitor state and federal energy conservation and alternative energy tech-

nology programs [Sections

9-5A-1

to

9-5A-7

NMSA 1978] .

BM/yr