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

SPONSOR Pinto

ORIGINAL DATE

LAST UPDATED

1/24/2008

HB

SHORT TITLE Hwy 491 Construction & Pavement

SB 365

ANALYST Moser

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY08

FY09

$100,000.0

Non-Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

New Mexico Department of Transportation (NMDOT)

SUMMARY

Synopsis of Bill

Senate Bill 365 appropriates $100,000,000 from the general fund to the NMDOT for

construction, reconstruction and pavement preservation of US 491 from the Jct. of BIA Road N-

9 to Shiprock, New Mexico.

FISCAL IMPLICATIONS

The appropriation of $100,000,000 contained in this bill is a nonrecurring expense to the general

fund. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not

revert to the general fund.

SIGNIFICANT ISSUES

NMDOT notes that while U.S. 491 is currently funded as part of Governor Richardson’s

Investment Partnership (GRIP) for $100 million, the overall cost to complete construction of this

four lane 70 mile GRIP project from Jct. of BIA Road N-9 to Shiprock, is approximately $260

million. The $100 million appropriated by this bill would allow for significant progress in the

Senate Bill 365 – Page

2

completion of this project. However, a $60 million shortfall would remain.

NMDOT has recently reached agreement with the Navajo Nation on the terms and conditions

associated with the right-of-way easements necessary for project improvements, business

taxation issues and project contributions. The agreement was the last remaining item withholding

the project from letting to bid. The project is scheduled to be let for bid in the spring of 2008.

OTHER SUBSTANTIVE ISSUES

The NMDOT notes that while Senate Bill 365 appropriates $100,000,000 to one of the GRIP

projects there remain several projects under GRIP that cannot be completed due to significant

funding shortfalls as a result of high inflationary rates impacting the highway construction

industry. The GRIP program currently is projecting a shortfall of $494 million.

GM/nt