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

SPONSOR Rawson

ORIGINAL DATE

LAST UPDATED

2/6/08

HB

SHORT TITLE Create State Ethics Commission, CA

SJR 6

ANALYST Wilson

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY10

FY11

Indeterminate

Indeterminate

Recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Administrative Office of the Courts (AOC)

Attorney General’s Office (AGO)

Corrections Department (CD)

Department of Finance & Administration (DFA)

Department of Transportation (DOT)

Public Education (PED)

Secretary of State (SOS)

SUMMARY

Synopsis of Bill

Senate Joint Resolution 6

proposes a constitutional amendment to Articles 5 and 6 of the New

Mexico Constitution to create a State Ethics Commission (commission). The commission will

have the authority to investigate and adjudicate alleged ethical violations committed by elected

officials, appointed officials, and employees of the state and its political subdivisions. The bill

will also abolish the Judicial Standards Commission.

The bill provides for the creation of an eight member commission, appointed by various

Legislative representatives, and sets forth certain requirements for member qualifications and

diversity. It establishes prohibited activities of commission members both during and for a

period of three years after service on the commission.

Senate Joint Resolution 6 – Page

2

The commission will draft an ethics code to be adopted by a two thirds majority vote of both the

House and Senate. The code will include penalties, and will govern the ethical conduct of all

elected officials, appointed officials, and employees of the state and its political subdivisions.

The bill provides that if a state official or employee is retired by order of the commission, that

official or employee will retire with the same rights as he or she had under the statutory

retirement program in which they participated.

All papers filed with the state ethics commission and proceedings before the commission will be

confidential; except that the commission will be required to issue a report upon the final

disposition of a complaint. The commission will also be required to submit an annual report of

its activities to the Governor and legislature in December of each year.

This proposed amendment to the New Mexico Constitution at the next general or special

election.

FISCAL IMPLICATIONS

The bill does not provide an appropriation, but designates the SEC will receive an annual

appropriation from the legislature sufficient to enable it to perform its duties. The bill requires

the commission to employ an executive director and other staff, including attorneys, to fulfill its

duties. Commission members will be entitled to receive per diem and mileage but no other

compensation. The executive director will receive a salary equal to that of a district court judge.

It is difficult to determine what constitutes a sufficient appropriation level and the staffing

requirements needed for this new commission. The current Judicial Standards Commission has a

budget of approximately $800,000 and 8 FTE. In order to oversee all other officials and

employees of the state and its political subdivisions, will most likely require a substantially

higher level of appropriation. Until the staffing requirements of the commission are determined

and the commission will begin operation, it is difficult to assess what appropriation level will be

sufficient to adequately fund the operations of the new commission.

SIGNIFICANT ISSUES

The establishment of a State Ethics Commission is a Governor's initiative. The

recommendations for such a commission were made by Governor Richardson's Task Force on

Ethic Reform in its report submitted on October 4, 2006. The Task Force was established by

Executive Order on May 3, 2006 to study the issues of governmental ethics and campaign

finance reform in an attempt to improve ethical behavior in state government. The Task Force

recommended establishing an independent State Ethics Commission to promote increased

accountability for ethical behavior among state officials and employees, lobbyists and those that

conduct business with the state.

DFA notes the resolution provides that all eight commission members are appointed by the

legislature. This eliminates the executive and judicial branches of government from having a

voice in the establishment of an ethics code and its administration. The Task Force

recommendations reported that the commission's political, administrative and legal independence

will be of critical importance to the effective functioning and administration of the commission.

Having all members appointed by one branch of government does not provide the checks and

balances required to maintain such independence.

Senate Joint Resolution 6 – Page

3

The AGO provided the following:

Should independently elected constitutional officers be removed from office by a new

commission like this, rather than through the time-honored process of impeachment by

the House and conviction by the Senate.

Another significant issue is the Commission’s narrow partisan membership: the

membership consists entirely of appointments by Democratic Party and Republican Party

legislative leaders from both chambers, which may lead to excluding members of other

political parties and registered Independents.

Since the resolution also mandates that no more than four members may belong to the

same political party, it is highly likely that the eight-member commission will be evenly

split between Republican and Democratic Party members, thus leading to a strong

possibility of gridlock.

The resolution keeps in place the current piecemeal enforcement of ethics legislation.

For example, the Secretary of State shares responsibility with the Attorney General for

enforcing the Financial Disclosure Act; in addition, the Secretary of State shares

responsibility with the District Attorneys and the Attorney General for enforcing the

Procurement Code and the Governmental Conduct Act; finally, no agency is specifically

charged with enforcing the Gift Act.

CD noted the following:

The commission can order disciplinary action against state employees it finds to have

committed ethics violations. The bill does not clearly give the disciplined employee or

official any appeal rights, whereas the current State Personnel Board rules give

disciplined classified employees appeal rights and procedural protections. If the

commission gets a complaint and examines it, it will appear that the state agencies will

have to await the outcome of the commission’s investigation/disciplinary process before

seeking or taking independent disciplinary action against the employee. The

commission’s code of ethics could supplement or even conflict with CD’s current code of

ethics. If CDL wanted to take disciplinary action against an employee for violations of

CD’s code, it will have to make sure that the commission had received no complaint on

that employee and/or that the alleged violation of CD’s code was for conduct not

prohibited by the commission’s code of ethics.

It is unclear if this new law will conflict with the collective bargaining agreement (CBA)

between the State and AFSCME, or the Public Employee Bargaining Act. For example,

Article 24, Section 4 of the CBA normally requires employers to serve all disciplinary

actions within 45 days of when the employer acquired knowledge of the employee’s

misconduct. If the commission disciplines an employee under this new law, it will not be

acting as the employer, but it will be in essence acting as the state. So whether or not the

commission will have to order any discipline within 45 days might be litigated or

challenged by AFSCME, for example. It must be assumed that AFSCME will challenge

the new law.

Senate Joint Resolution 6 – Page

4

ADMINISTRATIVE IMPLICATIONS

SJR6 does not specify if the agency will be considered a legislative, judicial or executive entity

for appropriation and administrative purposes. Although the agency is given the authority to hire

staff as necessary to carry out is responsibilities, with no specific appropriation to cover salaries,

operating costs, provide for investigations as well as mileage and per diem for commission

members, it can't be determined if the agency will have to limit its staff size. As has been the

experience with other small agencies, administrative staff will probably be minimal and may

serve multiple functions. This may present a problem for the commission to have an adequate

level of expertise over both policy and programmatic issues, as well as administrative functions.

In order for the commission to remain independent, these functions could not be supplemented

by support from any existing agency.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

SJR 6 relates to the following ethics bills:

HB 160, Amend Gift Act Allowable Amounts

HB 309, State Ethics Commission Act

HB 344, State Ethics Commission Act

HJM 24, Study Bipartisan State Elections Commission

SB 132, Whistleblower Protection Act

SB 320, Ethical Conduct of Political Subdivisions

SB 376, State Ethics Commission Act

SB 437, State Ethics Commission Act

DW/bb