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 Sanchez

ORIGINAL DATE

LAST UPDATED

1/24/2008

HB

SHORT TITLE Railroad Car Company Tax Act Rate Change

SB 331

ANALYST Moser

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$533.0

Recurring

State Road Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

REVENUE (dollars in thousands)

Estimated Revenue

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

FY10

$533.0

$533.0

Recurring

Railroad

Crossing

Maintenance

Fund

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

New Mexico Department of Transportation (NMDOT)

SUMMARY

Synopsis of Bill

Senate Bill 331 appropriates $533 thousand dollars from a newly created Railroad Crossing

Maintenance Fund to NMDOT for the purpose of

maintaining and improving railroad grade

crossings and railroad bridges.

Senate Bill 331 – Page

2

Senate Bill 331:

•

Raises the rate of tax imposed by the Railroad Car Company tax from 1.5% to 3.5% of the

gross earnings of the company.

•

Creates the Railroad Crossing Maintenance Fund in the state treasury to be administered

by the NMDOT. The fund consists of legislative appropriations and distributions made

pursuant to statute; gifts, grants, donations and bequests to the fund; and income, other

earnings on the fund or balances from prior fiscal years.

•

Makes a distribution to the Railroad Crossing Maintenance Fund in an amount equal to

four-sevenths of the tax collected.

•

Stipulates that any unexpended or unencumbered balance remaining at the end of a fiscal

year shall not revert to the general fund.

FISCAL IMPLICATIONS

The appropriation of $533 thousand contained in this bill is a recurring expense to the Railroad

Crossing Maintenance Fund. Any unexpended or unencumbered balance remaining at the end of

a fiscal year shall not revert to the general fund.

The proposed 2 percent increase in the rate of the Railroad Car Company Tax would be

earmarked for the Railroad Crossing Maintenance Fund. The current 1.5 percent earmarked for

the general fund would continue to be retained in the General Fund. There would be no decrease

in the tax revenue collected from the Railroad Car Company Tax for the General Fund.

This bill creates a new fund and provides for continuing appropriations. The LFC has concerns

with including continuing appropriation language in the statutory provisions for newly created

funds, as earmarking reduces the ability of the legislature to establish spending priorities.

SIGNIFICANT ISSUES

The money that would be appropriated to the NMDOT would be used to expand the NMDOT’s

current railroad grade crossing program. This money would supplement federal, state and private

railroad funds that are currently used for this purpose, and include improvements to NMDOT

owned rail crossings as well as public grade crossings owned by private railroads.

GM/nt