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

SPONSOR:	Sanchez		DATE TYPED:	2-19-99		HB
SHORT TITLE:		Legislative Success Scholarship				SB	13
					ANALYST:		Taylor

REVENUE

Estimated Revenue		Subsequent Years Impact	Recurring or Non-Rec	Fund Affected
FY99	FY2000	Subsequent Years Impact	Recurring or Non-Rec	Fund Affected
N.A.	$ (9.9)	$ (10.4)	Recurring	School Capital
N.A.	$ (6.6)	$ (6.9)	Recurring	Lottery Tuition
N.A.	$ 16.5	$ 17.3	Recurring	Leg. Success Scholarship

(Parenthesis ( ) Indicate Revenue Decreases)

Duplicates/Conflicts with/Companion to/Relates to HB-9,HB-81, HB-258, SB14, SB126, SB-252

SOURCE OF INFORMATION

Synopsis of Bill

Senate Bill 13 proposes to change the distribution of lottery net revenues. It would create a new fund called the Legislative Scholarship Fund and distribute 100 percent of net lottery revenue to this fund.

Under current law, 60 percent of lottery revenues are distributed to the public school capital outlay fund and 40 percent to the lottery tuition fund. The distributions to these funds are eliminated.

The proposed changes would become effective in FY 2000.

FISCAL IMPLICATIONS

The New Mexico Lottery Authority's FY 2000 revenue estimate is $93.5 million, with $16.5 million in net revenue available for distribution to the state. The proposed distributional changes are shown in the table on the next page. While the tables show a loss to the lottery tuition fund, the loss simply represents the change in the name of the scholarship fund. There is a real increase in money for scholarships equal to the lost distribution to public school capital outlay.

The estimated revenues in future years simply assumes that lottery revenues grow by 5 percent. A five percent growth rate is consistent with the growth rate projections of other goods and services.

FUND	FY 2000 CURRENT LAW	FY 2000 BILL PROPOSAL	FY 2000 DIFFERENCE
School Capital	$9.9	$ 0.0	(-$9.9)
Lottery Tuition	$6.6	$0.0	(-$6.6)
Legislative Success Scholarship	$0.0	$16.5	$16.5
Total	$16.5	$16.5	$16.5

OTHER SUBSTANTIVE ISSUES

The State Department of Education reports that the removal of public school capital outlay as a beneficiary of lottery revenues would reduce a large share of the dollars that they have available to help districts with critical capital outlay needs.

The Commission on Higher Education reports that if the distributions to the lottery tuition fund are not increased, they may have to reduce the amount of scholarship awards by FY 2001. The proposed increase in distribution to the tuition fund will allow them to continue providing 100 percent scholarships for several years.

BT/gm