NOTE: As provided in LFC policy, this report is intended for use by the standing finance committees of the legislature.  The Legislative Finance Committee does not assume responsibility for the accuracy of the information in this report when used in any other situation.

The LFC is only preparing FIRs on bills referred to the Senate Finance Committee, the Senate Ways and Means Committee, the House Appropriations and Finance Committee and the House Taxation and Revenue Committee. The chief clerks are responsible for preparing and issuing all other bill analyses.

Only the most recent FIR version, excluding attachments, is available on the Intranet. Previously issued FIRs and attachments may be obtained from the LFC office in Room 416 of the State Capitol Building.

(Parenthesis ( ) Indicate Expenditure Decreases)

Duplicates/Conflicts with/Companion to/Relates to SB16

SOURCES OF INFORMATION

LFC Files

Energy, Minerals and Natural Resources Department (EMNRD)

Tourism Department

New Mexico Finance Authority

SUMMARY

Synopsis of Bill

The bill would remove the State Parks Division from the Energy, Minerals and Natural Resources Department (EMNRD) and create a State Parks Department (not a cabinet-level department), headed by a superintendent of state parks appointed by the governor with the advice and consent of the senate. The bill would be effective July 1, 1999. The bill also redirects the portion of the governmental gross receipts tax distribution used for state park and recreation area capital improvements to the new State Parks Department.

The new agency would be administratively attached to the Tourism Department which would provide clerical services for personnel, budget preparation, record-keeping and administrative support.

Significant Issues

EMNRD has been criticized for increasing fees while decertifying and closing several state parks, despite public comments opposing the proposals. Popular annual regular camping permits have been eliminated and daily entrance fees have been increased 33 percent.

Closing state parks. In 1995, four senior EMNRD officials evaluated New Mexico state parks to make recommendations on the future utilization of each park as well as to recommend which parks should be "divested" or placed "on fallow status." Since the study was completed, EMNRD has decertified five state parks. Two state parks were transferred to agencies with no previous experience operating state parks. Four parks are either partially or entirely closed as a result of the EMNRD recommendations. Control of the former state parks has been transferred to other jurisdictions--Senator Willie Chavez State Park to the Belen Independent School District (BISD); Harry McAdams State Park to the City of Hobbs; Santa Fe State Park to the City of Santa Fe; Chicosa State Park to the Village of Roy; and Coronado State Park to the New Mexico Office of Cultural Affairs (OCA). Today, Chicosa State Park is closed except for groups which get permission in advance from the Village of Roy. Senator Willie Chavez State Park is closed except for groups which get permission in advance from BISD. Coronado State Park has been closed since October 1998, because the OCA was not provided funds to operate the campground. Additionally, Manzano State Park is closed during part of the year.

Public participation. There was no opportunity for public participation in developing the EMNRD recommendations on future utilization of New Mexico state parks or for public comment on the study prior to implementation of its recommendations. EMNRD's recent fee increases were implemented despite opposition during public hearings.

Fee increases. In 1998, EMNRD held a series of hearings on fee increases at state parks. There was strong opposition to the increases from individuals and statewide camping organizations such as the Good Sams and Zia Roadrunners. EMNRD increased the fees and abolished a popular season pass for non-senior citizens.

Proponents of this bill are concerned that EMNRD is not fulfilling its responsibility as steward of the state park system and that EMNRD is not sufficiently attentive to the wishes of New Mexicans in making decisions about the state park system.

According to EMNRD, the State Parks Division (SPD) represents approximately 55 percent of that agency's staff and a proportionate percentage of the administrative functions performed by the Administrative Services Division of EMNRD with a staff of 39 employees. EMNRD anticipates that it would be unlikely that the Tourism Department would be able to provide the administrative support services specified in this bill with its current staffing.

The New Mexico Finance Authority indicated a concern that the substitute for HB38 does not provide the new State Parks Department with the authority to issue bonds. The current SPD is allowed to issue bonds. If the intent is simply to create a new department with the same powers as SPD, the Park and Recreation Bond Act should be amended into the bill.

FISCAL IMPLICATIONS

The bill would reduce EMNRD's operating budget from $39.5 million to about $21 million and decrease its staff from 468 FTE to 203 FTE.

In addition to transferring SPD to the new State Parks Department, it would be necessary to transfer part of EMNRD's administrative services division to the Tourism Department. The table below presents the budget and FTE level for each of the EMNRD divisions:

The SPD, (division 500, highlighted above) contains 44.8 percent of EMNRD's budget and 54.7 percent its staff which would be transferred to the State Parks Department. EMNRD has not identified the portion of its administrative services division which would need to be transferred to the Tourism Department to provide administrative support to the new agency. The LFC staff estimates a transfer of $393.0 and 9.0 FTE would be required for administrative support. The bill does not specify transfer of these funds or staff.

Budget FTE

State Parks Division $18,156.0 256.0

Portion of ASD 393.7 9.0

$18,549.7 274.0

Two additional items would increase the fiscal impact of this proposed transfer: need for information systems to support the new department and the relocation of Santa Fe-based staff from EMNRD to the State Parks Department and Tourism Department. SPD has numerous field offices it manages throughout the state. According to EMNRD, the field offices pose a problem for computer systems that handle such common accounting functions like vouchers and receipts. EMNRD developed division specific information systems solutions to handle these problems, but integrated the systems into the department-wide systems. To ensure a smooth transition, the State Parks Department would either will have to develop new systems or to contract with EMNRD to continue to operate the existing system.

The Tourism Department projects a need for an additional 20 employees and $787.0 general fund to carry out its administrative responsibilities under this bill.

It appears that this change could be made with relatively little fiscal impact by transferring staff and functions to the new agency and contracting with EMNRD to continue access to that agency's automated systems, if the new department deems this advisable. The new agency's staff would not be required to move from their current offices. The primary new expense would be to employ a department secretary ($100.0 for salary and benefits) and division directors ($70.0 for salary and benefits each). Additionally, there would be some cost for new signage.

ADMINISTRATIVE IMPLICATIONS

EMNRD indicated that it would be difficult to separate administrative services staff responsible for the operation of state parks because the Administrative Services Division of EMNRD is structured in an integrated manner with all staff serving all divisions of that agency. EMNRD also indicated that transfer of SPD would not make good business sense due to the integrated expenditure and management tracking computer system which is used to process purchases and make general ledger transactions. EMNRD indicated that there is a symbiotic relationship between SPD and other EMNRD divisions, including assistance from the Energy and Management Division in planning and construction of park facilities and the use of YCC programs in park improvement projects.

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