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.

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

SPONSOR Cisneros

ORIGINAL DATE

LAST UPDATED

02/14/07

HB

SHORT TITLE Northern NM State School Faculty

SB 642

ANALYST Hanika Ortiz

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

$332.3

Recurring

General fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to HB 130

SOURCES OF INFORMATION

LFC Files

Responses Received From

Higher Education Department (HED)

SUMMARY

Synopsis of Bill

Senate Bill 642 appropriates $332,300 from the general fund to Northern New Mexico College

(NNMC) for FY08 to recruit and retain qualified faculty and staff; and, increase the salaries of

51 full time instruction faculty at the institution.

FISCAL IMPLICATIONS

The appropriation of $332,300 contained in this bill is a recurring expense to the general fund.

Any unexpended or unencumbered balance remaining at the end of FY08 shall revert to the

general fund.

This request was not submitted by NNMC to NMHED for review and was not included in the

Department’s funding recommendation for FY08.

SIGNIFICANT ISSUES

The purpose of SB 642 is to make faculty salaries at NNMC comparable to those offered at other

state institutions of higher education. NNMC hopes to double its student population in five years

Senate Bill 642 – Page

2

and increase its number of faculty by 25% in the same period. In order to attain this goal, NNMC

not only hopes to retain its current faculty, which is aging and approaching retirement age, but

also attract new faculty.

HED conducted a faculty salary study and presented its results to the Legislative Education

Study Committee in October 2006. HED estimates that correcting the current difference between

salaries at New Mexico institutions and their peer averages will require an estimated

$25,218,000 in additional funding. Assuming this will occur over 4 years, additional funds will

be required to off set an anticipated salary inflation of 3.5%, bringing the amount to

approximately $28,750,000. This will require an annual allocation of $7,200,000 to allow the

institutions to approximate the average salaries of their peers. All values assume the inclusion of

benefits in the calculations.

The HED study further noted that the case of NNMC is unique in that the institution is in

transition as it expands its mission to include degrees beyond the associate's level. Currently, it

offers a primarily lower division curriculum, with a typical community college faculty; that is, a

faculty with fewer terminal degrees than other comprehensive institutions. All faculty are

classified as instructors and salaries are in line with instructors at other comprehensive

institutions. Five new bachelor's degrees have been approved and NNMC is planning to

propose a number of bachelors and graduate programs in the near future. Faculty with terminal

degrees will be required for these programs. It is expected that these new faculty members will

be hired at the peer average for assistant professors at other comprehensive universities. Based

on this assumption, the salaries required for NNMC will be approximately $1.9 million dollars

for 32 additional faculty by 2009.

Nonetheless, HED's study found that current NNMC faculty members are primarily instructors

and that there is no current salary discrepancy between faculty of that rank at other

comprehensive universities in the state. It is not known how many of the faculty has terminal

degrees or could be classified at the assistant professor level. Without this information, it is not

known whether the request in this appropriation elevates the salaries of instructional faculty

without terminal degrees beyond that of similar faculty at other comprehensive institutions.

PERFORMANCE IMPLICATIONS

HED reports that NNMC expects to increase its number of faculty members by 25% in five

years. In light of the fiscal implications above, NNMC should provide an analysis of educational

attainment levels of existing faculty, what types of faculty it seeks to hire that require it to

request salary increases and how this fits with their overall institutional goals. Also necessary are

calculations of how many faculty they project they will lose each year that necessitate the hiring

of new faculty, as well as projections of how much NNMC expects this turnover rate to decrease

over time.

In addition, other comprehensive institutions use educational attainment levels and the tenure

and promotion process to calculate salary increases. NNMC will need to establish a plan that

will demonstrate equity and accountability in tying salary increases to merit similar to that of

other comprehensive institutions.

Senate Bill 642 – Page

3

ADMINISTRATIVE IMPLICATIONS

NNMC is the administrative entity for this request.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Relates to HB130, which appropriates $3 million to NNMC for new bachelors and masters

degree programs.

OTHER SUBSTANTIVE ISSUES

According to the NNMC website, the institution has undergone five name changes since it

opened its doors in 1909 as the Spanish American Normal School. In 2005, legislation led to its

fifth name change to the Northern New Mexico College (NNMC) to reflect its transition from a

two-year to four-year institution, which began in FY06.

ALTERNATIVES

NNMC can submit a salary adjustment plan for study and review by HED, the Legislative

Finance Committee (LFC), and the Department of Finance and Administration (DFA). NNMC

should submit an analysis of needs based on composites of existing faculty and future hiring

needs. This analysis and a salary adjustment plan to HED will be helpful in establishing a

comparison with other NM comprehensive institutions now that the department has conducted its

salary study.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

HED reports that the faculty and staff at NNMC will receive the same salary and compensation

increase as their counterparts will receive from previously enacted legislation.

AHO/nt