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

SPONSOR Williams

ORIGINAL DATE

LAST UPDATED 8/16/08 HB 16

SHORT TITLE Lincoln County Road and Bridge Repair

SB

ANALYST Weber

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY09

FY10

$3,600.0

Non-recurring

General Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to SB 2 and SB 29

SOURCES OF INFORMATION

LFC Files

SUMMARY

Synopsis of Bill

House Bill 16 appropriates $3.6 million from the General Fund to the Department of Homeland

Security and Emergency Management (DHLSEM) to plan design and construct improvements

and repairs to roads and bridges damaged by severe flooding in Lincoln County and the villages

of Ruidoso and Ruidoso Downs in Lincoln County.

FISCAL IMPLICATIONS

The appropriation of $3.6 million contained in this bill is a Non-recurring expense to the General

Fund. Any unexpended or unencumbered balance remaining at the end of FY2013 shall revert to

the General Fund.

SIGNIFICANT ISSUES

Severe rains July 26 and 27 spawned by the remnants of Hurricane Dolly led to damaging and

dangerous flooding in Lincoln County. On July 28 Governor Richardson issued Executive Order

2008-042 declaring a disaster in Lincoln County thereby releasing $750 thousand to the

Department of Homeland Security and Emergency Management (DHLSEM) to help defray local

costs associated with the disaster.

House Bill 16 – Page

2

After the initial emergency and rescue operations by DHLSEM and the National Guard,

assessment teams from both the state and the Federal Emergency Management Agency (FEMA)

began estimating infrastructure damage and costs to rehabilitate the area. Information gathered

by the teams pointed to damage being extensive enough to meet federal thresholds to qualify for

FEMA funding. Presently DHLSEM information estimates a swift final approval of the federal

aid for this purpose. Federal aid allows for a state-federal matching arrangement of 25 percent

state to 75 percent federal. The state funds can be a combination of state and local monies.

Worksheets provided by DHLSEM estimate the total required expenditures at approximately

$5.1 million. This total includes include $2.9 million for Lincoln County roads and bridges.

DHLSEM cautions however that this should NOT be construed as the final total costs but is

rather a rough projection to determine if federal thresholds for FEMA aid were met. Until

requests for proposals are issued and bids received the actual costs are somewhat uncertain and

difficult to estimate.

Once all the funding is in place the federal funds are handled on a reimbursement basis with

generally local authorities taking the lead for plan design and construction management. For this

reason it may be advisable to direct the appropriation to Local Government Division of the

Department of Finance and Administration. This division has direct contact and arrangements

on how to coordinate local community capital projects which this type of infrastructure repair

appears to be.

TECHNICAL ISSUES

The bill contains the following: “This amount is in addition to, and is not intended to supplant,

any federal emergency management assistance funds provided by the federal government”. This

language is not exactly clear whether the appropriation is intended to be over and above any state

matching fund requirement for federal aid or if it is intended to be the state match.

POSSIBLE QUESTIONS

Were there damages to other counties that may deserve financial consideration.

MW/mt