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.

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(Parenthesis ( ) Indicate Expenditure Decreases)

Relates to HB511

SOURCES OF INFORMATION

LFC Files

Economic Development Department (EDD)

SUMMARY

Synopsis of Bill

The bill would appropriate $210.0 general fund in FY2000 to the Economic Development Department for economic development initiatives in those rural and semi-rural areas throughout the state with the highest unemployment rates and lowest per capita income levels. Unexpended balances would revert to the general fund at the end of FY2000.

Significant Issues

One of the highest priorities of the economic development community at present is promotion of rural economic development. Toward this end, for example, the Industrial Development Training Program board recently adopted reforms to allow higher rates of reimbursement for companies creating new jobs in rural areas. Still, economic development in rural New Mexico lags behind the rest of the state. For example, in 1997 when the statewide unemployment rate was 6.2%, there were eight rural New Mexico counties with double digit unemployment (Luna 25.2%, Mora 19.3%, Taos 14.4%, Guadalupe 11.7%, Catron 10.9%, Rio Arriba 10.7%, Cibola 10.6%, and San Miguel 10.2%). Additionally, there is substantial unemployment among New Mexico Native Americans.

This bill would provide funds generally targeted to address this problem.

ADMINISTRATIVE IMPLICATIONS

The EDD would not need additional resources to administer these funds.

CONFLICT/DUPLICATION/COMPANIONSHIP/RELATIONSHIP

This bill relates to HB511 which would provide funds to promote the in-plant training program in rural areas and to provide information on strengths and weaknesses of the economic packages offered by rural communities to companies considering expansion or relocation to New Mexico.

OTHER SUBSTANTIVE ISSUES

The bill is not specific about the identity of the targeted areas of the state, nor is it clear exactly what services would be provided by EDD to these areas with these funds.

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