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 Begaye

ORIGINAL DATE

LAST UPDATED

1-28-2008

1-31-2008 HB 321/aHHGAC

SHORT TITLE Ship Rock as State Monument Feasibility Study

SB

ANALYST Woods

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$15.0

Continuing

Non-Recurring

General

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to HJM11

SOURCES OF INFORMATION

LFC Files

Responses Received From

Energy, Minerals and Natural Resources Department (EMNRD)

SUMMARY

Synopsis of HHGAC Amendment

As amended by the House Health and Government Affairs Committee, House Bill 321 requests a

feasibility study by the EMNRD/State Parks Division (SPD) for establishing the Ship Rock

pinnacle, located on the Navajo Reservation, as a state park. As originally proposed, HB 321

requested SPD conduct a feasibility study of the Ship Rock pinnacle as a state monument. The

amendment appropriates $15,000 to the Energy, Minerals, and Natural Resources Department/

State Parks Division (SPD) in FY08 and FY09 to conduct the study. Any unexpended or

unencumbered balance remaining at the end of fiscal year 2009 would revert to the general fund.

The legislation carries emergency language.

FISCAL IMPLICATIONS

EMNRD indicates that the type of study HB321a directs SPD to undertake typically costs SPD

around $25,000 in personnel and other costs (salary, travel, per diem, printing, etc.); therefore,

SPD does not have available budget in FY08 to complete the study. The balance of funds

needed to complete the study – $10 thousand – would need to come out of the FY08 and FY09

operating budgets for SPD or not be performed.

House Bill 321/aHHGAC – Page

2

SIGNIFICANT ISSUES

EMNRD raises a number of administrative and operational considerations associated with the

legislation. They are included in their entirety:

The amendment that was adopted clarified an ambiguity in the original HB 321 that

requested SPD conduct a feasibility study regarding designation of the Ship Rock

pinnacle as a “state monument." State monuments are managed by the Department of

Cultural Affairs. SPD does not prepare feasibility studies for proposed state monuments,

nor does it operate state monuments. The Health and Government Affairs Committee

amendment changed references to “monument" to “park" in HB 321a.

The location of the Ship Rock pinnacle on lands of the Navajo Nation presents significant

and difficult jurisdictional issues with respect to establishing a state park within the

Navajo Nation.

First, all 34 existing state parks are currently located on lands either owned by the state

through the Energy, Minerals and Natural Resources Department (EMNRD), lands leased

from another state or local state entity (State Land Office, Department of Game and Fish,

City of Albuquerque, Interstate Stream Commission, Storrie Water Users Association) or

lands leased from a federal agency (U.S. Bureau of Reclamation, U.S. Forest Service,

International Boundary and Water Commission, Corps of Engineers). In fact, NMSA

1978, Section 16-2-11(H), specifically provides for written agreements with agencies of

the U.S. to be entered into for the operation of state parks on federally owned lands.

There is no statutory authority for entering into leases with sovereign Indian tribes,

pueblos or Nations to establish and operate state parks. Moreover, leases typically include

terms with respect to breach by a party and provide for redress in a court of law in the

event of such a breach. The Nation could need to agree to be sued in the event of a

dispute over the lease for the park. The Nation might, therefore, have to agree to waive its

sovereign immunity from suit in order for SPD to have an enforceable lease with the

State of New Mexico, through EMNRD, for the park. Waiver of sovereign immunity

could present an insurmountable obstacle to a lease for a park on the Navajo Nation.

Second, in every instance where a lease for a state park exists, SPD has, as in the instance

of parks operated on lands owned outright by the State of New Mexico, full authority to

control all matters within the park and to exercise full law enforcement power within the

park. For SPD to exercise law enforcement authority on lands controlled by the Navajo

Nation, the Nation would need to recognize SPD’s law enforcement authority within the

park. If not, a jurisdictional challenge to an arrest or citation made by a SPD officer could

be raised by a defendant or a cited individual on the basis SPD has no law enforcement

within the Navajo Nation. Up to now, Indian Tribes have not been willing to recognize

state jurisdiction over all criminal matters occurring within reservations, particularly

where tribal members are involved.

Third, to operate a state park within the Navajo Nation, SPD would likely have to invest

in significant infrastructure development in developing a visitor center, campgrounds,

comfort stations, etc. A question would arise as to whether the procurement of such

infrastructure development would be governed by the laws of the state of New Mexico or

House Bill 321/aHHGAC – Page

3

those of the Navajo Nation. What happens in the event of a dispute between a contractor

and EMNRD; is it enforced in state court or tribal court. Do the gross receipts taxes of

New Mexico apply or the taxing power of the Nation. What wage guidelines govern.

Would the state be subject to preference requirements for Navajos in constructing and

operating a visitor’s center and, if so, how would conflicts be resolved between state

labor and personnel requirements and those of the Nation.

Fourth, the Tort Claims Act (NMSA 1978, Sections 41-4-1 et seq.) waives state tort

immunity in connection with operating public parks (Section 41-4-6), but grants tort

claim insurance coverage to state employees acting within the scope of their duties.

Absent clarification in the law, it is not clear whether a state employee performing work

within the jurisdiction of a sovereign nation would be considered acting within the scope

of his duties. Therefore, a determination on this point would be needed from the Risk

Management Division of the General Services Department. SPD has already submitted a

request for such clarification.

In summary, the State of New Mexico, through EMNRD/SPD, would need to enter into a

series of agreements with the Navajo Nation to identify and resolve all jurisdictional

issues implicated in taking the unprecedented step of establishing a state park within

another sovereign nation; namely, the Navajo Nation.

ADMINISTRATIVE IMPLICATIONS

EMNRD states that, “SPD does not have available resources to complete the study."

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

EMNRD notes that no feasibility study will be prepared.

Synopsis of Original Bill

House Bill 321 seeks to appropriate $15,000 from the general fund to the Energy, Minerals and

Natural Resources Department for expenditure in fiscal years 2008 and 2009 for the State Parks

Division to conduct a feasibility study regarding the designation of the Ship Rock pinnacle as a

state monument. Any unexpended or unencumbered balance remaining at the end of fiscal year

2009 shall revert to the general fund.

This legislation carries emergency language.

SIGNIFICANT ISSUES:

DCA advises that, while the legislation requests that EMNRD undertake a feasibility study of the

Ship Rock Pinnacle as a possible state monument, the State Parks Division is not the appropriate

entity to conduct a feasibility study on the possibility of a site becoming a State Monument.

Rather, the appropriate entity is the State Monuments Division of the Department of Cultural

Affairs. EMNRD appears to support the DCA opinion, stating that:

“State monuments are managed by the Department of Cultural Affairs and SPD has

no statutory authority over state monuments. Further, SPD does not undertake

House Bill 321/aHHGAC – Page

4

feasibility studies for proposed state monuments and does not manage

monuments."

DCA concludes that, as written, the bill is somewhat unclear about whether the intention of the

study is to determine whether the Ship Rock Pinnacle should be designated a state monument or

a state park. Further, the Department of Cultural Affairs Policy On Cultural Properties) (4.51.26

NMAC) outlines the procedures through which a cultural property may be acquired by the State

Monuments Division and designated a state monument. This policy states that should there be

sufficient interest in prehistoric or historic sites of statewide or regional significance to warrant

their inclusion within the state monument system, a feasibility study shall be conducted by the

Museum of New Mexico.

1

EMNRD notes that an important additional consideration is that Ship Rock is located on Navajo

Nation land, which raises significant questions about sovereignty, legal jurisdiction, tort claims

liability, cultural sensitivity, and future management: “Would state employees performing duties

on the Navajo Nation—which is, arguably, outside state jurisdiction—be acting within the scope

of their duties under state law for purposes of the Tort Claims Act. What about law

enforcement." Any feasibility study for a state monument, EMNRD opines, would need to

explore these issues and offer a range of alternatives for management/collaboration between the

Navajo Nation and the State of New Mexico.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP:

Relates to HJM11 which requests the SPD undertake a feasibility study of Ship Rock as a state

monument.

TECHNICAL ISSUES:

EMNRD indicates that, “Because SB 321 directs a study pertaining to a proposed state

monument, the State Monuments Division of the Department of Cultural Affairs should perform

that study, not SPD."

OTHER SUBSTANTIVE ISSUES:

As background, EMNRD advises that indicates that the Ship Rock Pinnacle is one of the most

well-known natural features in New Mexico and is also nationally significant, having been

designated as a National Natural Landmark by the U.S. Department of the Interior, National Park

Service, in 1975. Ship Roc and the surrounding area are of great religious and historical

significance to the Navajo Nation.

ALTERNATIVES:

DCA suggests the Department of Cultural Affairs and its State Monuments division could be

requested to study the feasibility of Ship Rock Pinnacle as a state monument.

1

In an updated FIR (received 1-28-2008) DCA notes that it is DCA’s “…understanding that the Navajo Nation's

Shiprock Chapter sent a resolution to the Governor requesting that Shiprock become a State Park."

House Bill 321/aHHGAC – Page

5

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

There may be no evaluation of Ship Rock Pinnacle as possible New Mexico State Monument.

AMENDMENTS

EMNRD suggests that on page 1, lines 17 through 19, replace “energy, minerals and natural

resources department for expenditure in fiscal years 2008 and 2009 for the state parks division"

with “state monuments division of the department of cultural affairs for expenditures in fiscal

years 2008 and 2009."

BFW/nt