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 HAFC
ORIGINAL DATE
LAST UPDATED
02/06/08
HB CS/660/aHAFC
SHORT TITLE Solar Energy Research Park and Academy
SB
ANALYST Williams
APPROPRIATION (dollars in thousands)
Appropriation
Recurring
or Non-Rec
Fund
Affected
FY08
FY09
NFI
(Parenthesis ( ) Indicate Expenditure Decreases)
Relates to HB 146
ESTIMATED ADDITIONAL OPERATING BUDGET IMPACT (dollars in thousands)
FY08
FY09
FY10 3 Year
Total Cost
Recurring
or Non-Rec
Fund
Affected
Currently
unknown Recurring
General Fund (student
credit hours to generate
formula funding)
Currently
unknown Recurring
General Fund
(additional operating
funds for academic and
research facilities); see
discussion below
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
LFC Files
Responses Received From
Higher Education Department (HED)
Northern New Mexico College (NNMC)
Energy, Minerals & Natural Resources Department (EMNRD)
Economic Development Department (EDD)
Public Education Department (PED)
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CS/House Bill 660/aHAFC – Page
2
SUMMARY
Synopsis of HAFC Substitute Amendment
The HAFC amendment to the HAFC substitute strikes the appropriation.
Synopsis of Original Substitute Bill
House Appropriation and Finance Committee Substitute for House Bill 660 creates the solar
energy research park and academy at Northern New Mexico College, referred to in the bill as
Northern New Mexico state school. This public, postsecondary institution is directed to
collaborate with Los Alamos National Laboratory to develop technology transfer applications
related to solar energy. Further, the bill authorizes in statute three new degree programs:
Associate in Science, Bachelor of Science and Master of Science in mechanical engineering with
a major in solar energy. Finally, the bill appropriates $2 million from the General Fund to the
Board of Regents of the Northern New Mexico State School to establish the research park and
academy.
FISCAL IMPLICATIONS
The HAFC amendment removed the appropriation. The original appropriation in the HAFC
Substitute for House Bill 660 was a $2 million recurring expense to the General Fund. Any
unexpended or unencumbered balance remaining at the end of fiscal year 2009 would not revert
to the general fund.
A request for funding of $1 million was submitted by Northern New Mexico College to the
Higher Education Department in the Fall 2007 budget cycle, but was not included in
Department’s funding request for higher education in FY09. In its November 2007 evaluation of
research and public service project expansion requests and new initiatives, HED rates the NNMC
request as a “breach" of the higher education funding formula. The January 2008 LFC report
“Higher Education Review of Selected Research and Public Service Projects" discusses best
practices for funding these types of projects.
For the academic degree programs discussed in this bill, formula funding would be generated
based on completed student credit hours with a two-year lag. NNMC notes after three years,
federal funds and fees for services will also be generated.
SIGNIFICANT ISSUES
NNMC discusses the research park and academy would have three components to its mission:
1)
“fund the initiation of a comprehensive academic degree program;
2)
allow for the purchase of land and construction of associated academic research activities
in the areas of solar energy conversion and storage systems;
3)
provide funds for community outreach programs and development of public policy for
the commercialization of solar energy conversion and storage systems…"
PED notes the proposed program could provide opportunities for students who follow the high
school career cluster of Energy and Environmental Technology.
According to HED, New Mexico’s combination of ideal weather and entrepreneurial spirit make
it a potential epicenter for renewable energy in the twenty-first century. The state experiences
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CS/House Bill 660/aHAFC – Page
3
more than 340 days of sunshine per year, and in the eastern region, sustained winds are the norm,
making New Mexico an ideal location for solar and wind energy research.
EDD indicates that for more than twenty-five years, New Mexico has excelled in hydrogen and
fuel cell research and development. EDD sponsored the creation of the Hydrogen Technology
Partnership, which is now managed by the Regional Development Corporation. This alliance of
industry, academia, and government leaders envisions the use of New Mexico research and
resources to reduce the nation’s dependency on imported oil.
EDD further states that research in renewable energy is thriving in New Mexico. In 2004, the
state received $40.4 million from the U.S. Department of Energy Office of Energy Efficiency
and Renewable Energy for a variety of state and federal programs relating to renewable energy
development.
EMNRD discusses there is a current need in the New Mexico solar industry for qualified
plumbers and mechanical technicians with solar expertise. This is a growing industry that
requires that programs focus on technology transfer, commercialization, and training activities.
EMNRD recommends that the new facility include programs that emphasize technology transfer
and commercialization of solar systems, and training of technicians to install and service them.
EMNRD further encourages NNMCC to emphasize solar thermal heating and cooling
technologies through its programs.
New Mexico public, postsecondary activities in the area of solar energy include:
•
In June 2006, New Mexico State University (NMSU) was awarded an $875,000 grant
from the U.S. Department of Energy (DOE) for solar energy research and development.
Funding benefited NMSU's Southwest Region Experiment Station (SWRES), which
provides support to the DOE National Center for Photovoltaics.
•
University of New Mexico: Focus on elimination of precious metals in fuel cells, thus
reducing their cost. They are also investigating methods to make large-scale hydrogen
generation more effective.
•
New Mexico Institute of Mining and Technology: Focus on fuel cells and technology
related to clean coal production.
•
San Juan College, Farmington: Offers a two-year renewable energy degree and
certificate. Half the program’s students already have at least a bachelor’s degree before
they begin; 25 students are enrolled.
OTHER SUBSTANTIVE ISSUES
Laws of 2005, Chapter 289 (House Bill 745) created the Higher Education Department. Known
as the “Higher Education Department Act", 21-1-26 NMSA 1978 in Section A (4) specifies the
department shall “analyze the financial impact of each new degree program of each public
postsecondary educational institution as part of the department’s review of the institution’s
operating budget". Further, in Section B, the Act states “Effective July 1, 2005, all new state-
funded baccalaureate, graduate and professional degree programs shall be offered by public four-
year educational institutions and all new associate degree programs shall be offered by public
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CS/House Bill 660/aHAFC – Page
4
post-secondary educational institutions after a timely and thorough consultation with and review
by the department."
ALTERNATIVES
NNMC notes capital funds of approximately $6 million may be needed.
PERFORMANCE IMPLICATIONS
PED notes student preparation for careers in energy and environmental technologies is also
supported by Standard l (Physical Science): Under the structure and properties of matter, the
characteristics of energy, and the interactions between matter and energy of Strand ll: Content of
Science of the New Mexico Science Content Standards, Benchmarks, and Performance
Standards.
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